Senate Bill S3260

                                 BILL NUMBER:  S3260

 TITLE OF BILL :
An act to amend the public service law, in relation to the
establishment of investigation, hearing and determination procedures
with respect to the creation of new area codes


 PURPOSE :
Requires the Public Service Commission (PSC) to adopt policies and
procedures to avoid unnecessary or premature addition of new telephone
area codes at significant cost and inconvenience to telephone
consumers through conservation in the initial allocation of telephone
numbers and exchange codes and reclamation of underutilized exchange
codes and unused telephone numbers for reallocation to higher priority
areas. This bill would also require the PSC to assign an
administrative law judge to conduct evidentiary proceedings and to
issue a recommended decision on any proposed addition of a new area
code.

 SUMMARY OF PROVISIONS :
Section One of the bill would provide for the Legislative findings and
intent Section Two of the bill would add a new Section 96-a to the
public service law which would provide for investigation, hearing and
determinations regarding number conservation, number resource
reclamation, and consideration of alternatives prior to implementation
              

of new area codes. Section three of the bill would provide for an
immediate effective date and shall apply to any pending commission
proceedings regarding creation of new area codes.

 JUSTIFICATION :
Historically, when there was only one provider of local telephone
service, that provider received new number allocations in blocks of
10,000 for each local exchange rate center. The three digit "NXX" in a
telephone number, such as 518-NXX-1234, represents the exchange code;
each NXX mathematically contains 10,000 numbers. Each NXX code can
only be used in its designated rate center New NXX codes were added
when existing codes neared exhaustion.

With the advent of competitive providers of telephone service, it
became necessary to make numbering resources available to them. It
became apparent that these resources would be exhausted swiftly if
they continued to be given out in blocks of 10,000 to each new
competitor The PSC (to which the Federal Communication Commission
(FCC) delegated approval of new number allocations) and the FCC
adopted number conservation policies encouraging or requiring holders
of 10,000 telephone number NXX codes to "pool" unused numbers for use
by competitors in blocks of 1,000 before giving out new thousand
blocks. The block NXX-1000 would be given to one competitor, the block
NXX-2000 would be given to another competitors, etc. Also, in granting
certificates to new competitive providers, the PSC required them to be
capable of utilizing numbers in blocks of 1,000.

These policies began in 2000 with major urban areas (nationally the
largest 100 MSA's) and were intended to be expanded to other areas as
competitive providers extended the geographic scope of their services
and needed new numbers. As a result of these number conservation
policies, and the advent of local number portability (LNP) which
allows the transfer of a customer's telephone number from one provider
to another without requiring use of any new numbers, the rate at which
NXX codes are being exhausted, requiring new area codes, was
substantially reduced.

Despite the policies favoring number conservation through thousands
block pooling, the PSC continued to permit full NXX codes to be
granted to competitive telephone companies in rural areas of the
state. As a result, multiple NXX codes with 10,000 numbers each were
allocated in the past few years to many locations with populations
easily served with fewer codes. Had thousands block pooling been in
force statewide, this would not have occurred.

The PSC in 2005, asked the FCC for permission to extend thousands
block pooling to rural areas. In November 2006, the FCC clarified that
the PSC has that authority. It was not until March 2007, that the PSC
finally ordered thousands block pooling statewide, including rural
areas where it had been permitting 10,000 block NXX codes to be issued
on request to competitive providers.

From 2005, until thousands block pooling was finally implemented, the
PSC allowed at least 78 new NXX codes, with 10,000 numbers each, to
competitive carriers in rural areas of the 315 area code, some of them
with populations bardyover 1,000. For example, full NXX codes were
allocated to Adams Center (population 1,500), Branchport (population
4818), and Henderson (population 1,377), in March 2007.

In Case 07-C1486, the PSC proposed to create a new area code within
the current region now served with a 315 area code because, although
millions of telephone numbers within 315 remained unused, the NXX
codes- many of them extra codes allocated in rural areas-- were
nearing exhaustion. The PSC rejected a request for appointment of an
administrative law judge to conduct proceedings on the record
regarding the possible over-allocation of multiple NXX codes in
sparsely populated areas, and the PSC did not conduct evidentiary
proceedings to consider evidence regarding feasibility of reclaiming
possible wasted numbering resources in such areas. The PSC instead
resumed its plans to create a new area code within the current 315
area in a decision issued April 25, 2008.

The PSC has issued orders requiring the return of unused numbering
resources and NXX codes so that they can be pooled and made available
in areas where existing NXX codes are nearly full and new ones are
really needed. See, e.g., Case 98-C-0689 (An October 30, 2002 Order
requiring return of unused Telergy codes). Even if improvidently
allocated, when NXX codes have only been partially used, the few
assigned numbers could be changed, freeing up the NXX codes for
reallocation to areas that are truly filling existing NXX blocks, and
the massive impact of area code changes affecting far larger numbers
of people could be avoided. This bill would require the PSC to balance
the comparative inconvenience of changing relatively few numbers now
within underutilized exchanges to reclaim and free those exchanges for
reallocation with the cost and inconvenience of implementing a new
area code adversely affecting over one million people.

This bill would not obstruct the PSC in creation of new area codes
where that is necessary. It only requires on the record proceedings
conducted by an administrative law judge (ALJ) to examine evidence
supporting the need for a new area code and to determine whether
previously allocated NXX codes and numbers can be reclaimed in order
to avoid or reduce the cost and expense to consumers.

The added procedural protection would develop a record based on
evidence and would not add significantly to costs or time because it
only requires appointment of a stiff ALJ to develop a record and make
a recommended decision regarding infrequent area code changes The cost
of such added review and protection is far outweighed by the enormous
cost and inconvenience to telephone customers if it can prevent or
significantly delay implementation of a new area code.

This bill would apply to pending area code proceedings regarding the
current 315 area code. The additional hearings and investigations
required by this bill will not interfere with implementation of new
area codes in 315 if ultimately they are required because the
estimated time for exhaustion of number resources within 315 has been
extended six months from the date previously estimated, allowing ample
time for the investigation of number reclamation alternatives.

 LEGISLATIVE HISTORY :
S.8506 Passed Senate/A.11082 Ways and Means Committee

 FISCAL IMPLICATIONS :
None.

 EFFECTIVE DATE :
Immediate.