THE STATE OF SOUTH CAROLINA
In The Supreme Court
Philip S. Porter,
Consumer Advocate for
the State of South
South Carolina Public
Service Commission and
AT&T Communications of
the Southern States, Inc., Respondents.
Appeal From Richland County
L. Casey Manning, Circuit Court Judge
Opinion No. 24669
Heard May 21, 1997 - Filed August 11, 1997
Phillip S. Porter, Nancy Vaughn Coombs, and Elliott F.
Elam, Jr., all of Columbia, for appellant.
F. David Butler and Florence P. Belser, of Columbia, for
respondent S.C. Public Service Commission, and Francis P.
Mood and Joseph D. Clark, both of Sinkler and Boyd, of
Columbia, for respondent AT&T Communications of the
Southern States, Inc,
WALLER, A.J.: This appeal involves an order of the Public Service
Commission (PSC) which removed price caps for certain business services provided
by AT&T. We affirm.
Subsequent to AT&T's divesture in 1983, the PSC issued Order # 84-622
regulating interexchange telephone carriers (IXCS) and setting forth price caps. In
PHILIP S. PORTER, etc. v. SCPSC, et al.
1995, AT&T filed a petition pursuant to S.C. Code Ann. § 58-9-585 (Supp. 1994)
seeking alternative regulation for certain of its services,1 and requesting, inter alia,
PSC to declare these services competitive and remove price caps therefrom. By Order
# 95-1734, PSC found the "substantial evidence of record does not show ... that
AT&T's services for which it seeks alternative regulation are competitive."
Nonetheless, PSC found "the competitive forces demonstrated did warrant
modification of the existing process" and removal of the price caps. PSC modified the
existing rate structure to provide the maximum rate requirements would be removed
provided AT&T filed tariffs which reflect average toll rates within South Carolina.
The modification was implemented on a trial basis. The circuit court affirmed the
PSC; the Consumer Advocate appeals.
Did the PSC act within its authority in removing the rate caps?
The Consumer Advocate contends that, once PSC determined that AT&T had
failed to prove its services were "competitive" within the meaning of section 58-9-585,
PSC was without authority to remove the rate caps. We disagree. We find PSC had
authority to modify Order #84-622 pursuant to both § 58-9-585 (D), and its general
powers under § 58-9-720 (1976) and 58-3-140 (1976).
S.C. Code Ann. § 58-9-585 provides, in pertinent part:
(A) Notwithstanding any other provision of this chapter, the
commission, on the request of an interexchange telecommunications
carrier or on its own motion, may consider, in lieu of the procedures
outlined in this chapter, alternative means of regulating that carrier. If
the commission first determines, after notice and hearing, that the
substantial evidence of record shows that a particular service is
competitive in the relevant geographic market, the commission may
implement regulatory alternatives including, but not limited to, the
provisions outlined in this section. (B) If the commission determines that an interexchange telecommunications carrier service is competitive, the commission shall not fix or prescribe the rates, tolls, charges, or rate structures for that service .... (D) For an interexchange telecommunications carrier service found to be ___________________________
1The services in question were business long distance services, consumer card and
PHILIP S. PORTER, etc. v. SCPSC, et al. noncompetitive, the commission may implement other regulatory alternatives including, but not limited to, price caps. (Emphasis
Under the literal terms of § 58-9-585, PSC is authorized to implement regulatory
alternatives regardless of whether it finds a service competitive or noncompetitive.
Compare subsections (A) & (D). Although subsection (A) appears to require a finding
of "competitiveness" prior to implementation of an "alternative means of regulation,"
subsection (D) clearly permits PSC to implement alternative regulatory means,
"including, but not limited to" price caps, notwithstanding a lack of competitiveness.
Clearly, this language permits, but does not require PSC to utilize rate caps.
Further, nothing in this statute, or in any other section of Chapter 9 of Title 58,
requires PSC to implement or retain rate caps. The only absolute mandate under §
58-9-585 is found in subsection (B), which prohibits rate caps upon a finding of
competitiveness. As nothing in the statute requires rate caps, PSC clearly had
authority to remove them under subsection (D).2
In addition to its authority under § 58-9-585, PSC relies upon § 58-9-720 and
§ 58-3-140 as general authority for its modification of Order # 84-622. We agree with
PSC, and the circuit court, that these sections are consistent with PSC's powers
under § 58-9-585.
Sections 58-3-140 (1976) and 58-9-720 (1976) vest PSC with broad general
powers to "supervise and regulate the rates and service" of every public utility (§ 58-
3-140) and to fix "just and reasonable classifications, regulations, practices or service
to be furnished, imposed, observed and followed by any or all telephone utilities..."
(§ 58-9-720). Order # 84-622, setting forth rate caps, was implemented pursuant to
PSC's general powers under Sections 58-3-140 (1976) and 58-9-720 (1976). Since
nothing in § 58-9-585 requires PSC to set rate caps, we find these statutes, together
with § 58-9-585, permit PSC to alter the procedures previously set forth by it in Order
#84-622.3 Hamm v. AT&T, 302 S.C. 210, 394 S.E.2d 842 (1990)(PSC may modify or __________________________
2Although PSC did not rely on this section for its modification, § 58-9-585 was the
sole basis for relief asserted by AT&T. This Court may take judicial notice of a
statute, Jones, Inc. v. B-F Limited Partnership, 276 S.C. 469, 279 S.E.2d 613 (1981),
and may affirm for any reason appearing in the record. State v. Smith, 316 S.C. 53,
447 S.E.2d 175 (1994); Rule 220 (A), SCACR.
3The Consumer Advocate contends that § 58-9-585, being the more recent and
specific legislation, controls. See State v. Brown, 317 S.C. 55, 451 S.E.2d 888 (1994);
Whiteside v. Cherokee County School District No. One, 311 S.C. 335 428 S.E.2d 886
(1992). However, this rule of statutory construction comes into play only when there
is a conflict between the statutes. See Williams v. Town of Hilton Head, 316 S.C. 53,
429 S.E.2d 802 (1993)(where it is not possible to harmonize two statutes, the later
legislation supersedes the earlier enactment). Where two statutes can be reconciled
PHILIP S. PORTER, etc. v. SCPSC. et al.
(1990)(PSC may modify or amend its own orders after notice and an opportunity
to be heard). Cf. Heater of Seabrook v. PSC, Op. No. 24473 (S.C. Sup. Ct. filed
Aug. 12, 1996) (Davis Adv. Sh. No. 22 at 2)(South Carolina law does not require
Commission to use any particular price-setting methodology).
Finally, Consumer Advocate contends that interested parties were not on
notice that Order # 84-622 might be modified. We disagree.
AT&T's petition, although requesting relief under section 58-9-585, clearly
requested a removal of price caps. Since the only thing requiring price caps was
Order # 84-622, any modification of price caps pursuant to the statute would, of
necessity, require a modification of Order 84-622. This Court has recognized that,
pursuant to its authority under § 58-9-1200 (1976), the PSC may modify or amend
its own orders after notice and an opportunity to be heard. Hamm v. AT&T, supra.
Although a modification of Order # 84-622 was not specifically pled by AT&T, it did
specifically request a removal of price caps. This was sufficient to put Consumer
Advocate on notice that a modification of Order # 84-622 would be required if price
caps were removed. Cf. GTE Sprint Comm'n v. PSC, 288 S.C. 174, 341 S.E.2d 126
(1986)(prior PSC order sufficient to give notice of standards upon which PSC would
FINNEY, C.J., TOAL, and MOORE, JJ., and Acting Associate
Justice George T. Gregory, Jr., concur. __________________________
statutes can be reconciled
and are susceptible of a construction which will render both operative without doing
violence to either, it is the duty of the court to so construe them. Lewis v. Gaddy,
254 S.C. 266, 173 S.E.2d 376 (1970). Here, there is no conflict between the
statutes and, accordingly, they may be harmonized.
Further, since PSC acted within its authority pursuant to these sections, it
did not, as the Consumer Advocate contends, exceed its statutory authority under
§ 1-23-380 (A)(6)(b) & (c); of the Administrative Procedures Act.