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Before the FEDERAL COMMUNICATIONS COMMISSION Washington, D.C. 20554 In the Matter of ) ) HAWAIIAN TELCOM, INC. ) WCB/Pricing File No. 06-19 ) Petition for a Waiver of Sections 61.42(g), 61.38, ) And 61.49 of the Commission’s Price Cap Rules ) for Advanced Services Formerly Offered by ) Verizon Hawaii, Inc. ) REPLY COMMENTS OF HAWAIIAN TELCOM, INC. Hawaiian Telcom, Inc. (“Hawaiian Telcom”), through its attorneys, hereby responds to the comments of Pacific LightNet, Inc. (“Pacific LightNet”) on its above-captioned Petition for Waiver (“Petition”). Hawaiian Telcom respectfully requests that the Commission expeditiously grant the Petition without regard for the irrelevant comments of Pacific LightNet. In its Petition, Hawaiian Telcom requested a waiver of the Commission’s rules to maintain the status quo with respect to certain interstate advanced services that are currently tariffed outside of the Commission’s system of price cap rate regulation, pursuant to a series of waivers granted to Hawaiian Telcom’s predecessor, Verizon Hawaii. In its comments, Pacific LightNet cites Hawaiian Telcom’s voluntary commitment to the Hawaii Public Utilities Commission (“HPUC”) not to submit any “application for a general utility rate increase that would utilize a prospective test year earlier than calendar year 2009,” absent a “compelling financial need.”1 In light of this commitment, Pacific LightNet requests clarification of Hawaiian Telcom’s statement in its Petition that, by granting Hawaiian Telcom’s waiver request, the Commission could eliminate any possibility that future rate reductions for advanced services 1 Application of Paradise Mergersub, Inc., GTE Corporation, Verizon Hawaii Inc., Bell Atlantic Communications, Inc., and Verizon Select Services, Inc. for Approval of a Merger Transaction and Related Matters, Docket No. 04- 0140, Decision and Order No. 21696 (Hawaii P.U.C. Mar. 16, 2005) at 29. DC\862975.1 might create “headroom” for other services in the same basket under the Commission’s system of price caps.2 Hawaiian Telcom believes that no clarification is necessary and, indeed, that Pacific LightNet’s request is a non sequitur. Hawaiian Telcom’s rate commitment to the HPUC applies exclusively to rates in the intrastate jurisdiction, while the tariff filing in question covers jurisdictionally interstate services. Hawaiian Telcom’s commitment applies to any general utility rate increase. The HPUC’s rules define the term “general rate increase” and contain detailed rules for conducting that type of proceeding before the HPUC.3 These rules do not – and cannot – apply to rates for jurisdictionally interstate services.4 Thus, Hawaiian Telcom’s commitment to the HPUC is utterly irrelevant to the Petition before the Commission. Moreover, Hawaiian Telcom’s statement in its Petition is an unremarkable summary of one aspect of the operation of the Commission’s price cap rules. Hawaiian Telcom did not assert any intent to make price changes – up or down – in its Petition. The Petition merely seeks to preserve the status quo by keeping Hawaiian Telcom’s services outside of price caps, as they are today. As indicated in the Petition, one public interest benefit the Commission can obtain by granting the requested waiver (and thus preserving the status quo) would be to prevent any headroom that could be created by rates for advanced services from being used to raise other rates. * * * * * In response to a separate request for clarification from the Commission staff, Hawaiian Telcom clarifies that it does not intend to detariff the transmission component of any 2 Petition at 6. 3 Hawaii Administrative Rules § 6-61-2 (defining “general rate increase”), §§ 6-61-85 through 6-61-95 (establishing procedures for seeking a general rate increase). 4 47 U.S.C. § 152(a) (granting the Commission plenary jurisdiction over interstate and foreign communication by wire or radio); Smith v. Illinois Bell Tel. Co., 282 U.S. 133, 148 (1930). 2 DC\862975.1 .

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