DR 97-187
                                     
                   wilton telephone and hollis telephone
                                 companies
                                     
           Show Cause Why the Companies Should Not be Fined for
                Operating in Violation of Commission Order
                                     
                     Order Dismissing Show Cause Order
                                     
                         O R D E R   N O.  22,823
                                     
                              January 6, 1998
                                     
         On September 16, 1997, the New Hampshire Public
     Utilities Commission (Commission) issued Order No. 22,724 which
     required Wilton Telephone Company (Wilton) and Hollis Telephone
     Company (Hollis) to show cause why they should not be fined for
     violation of Order No. 22,281 (August 16, 1996) regarding
     necessary steps in becoming a toll provider prior to intraLATA
     presubscription.
         The relevant facts for the purposes of this order,
     briefly, are these:  On April 29, 1997, Wilton and Hollis filed
     tariffs with the Commission to become the designated toll
     provider in their franchise areas.  The Commission did not act on
     the filings and on June 2, 1997, Wilton and Hollis replaced NYNEX
     as the toll provider for its service territory.  IntraLATA
     presubscription was also implemented June 2, 1997.  
         Wilton and Hollis argued that the Show Cause order
     should be dismissed because they had been entitled to become the
     toll provider for their franchise areas pursuant to the terms of
     the Stipulation reached in DE 90-002 and each company's toll
     tariff.  Further, because the Commission did not respond during
     the 30 day period from their toll provider filings, they believed
     the authorization had been granted by operation of law, pursuant
     to RSA 378:3.
         In addition, Wilton and Hollis argued that the Show
     Cause order should be dismissed as an unconstitutional
     proceeding.  Wilton and Hollis asserted a right to jury trial on
     any action that could result in a penalty of greater than $1,500. 
     The Show Cause order noticed the possibility of a fine exceeding
     that amount.  
         Commission Staff (Staff) submitted on October 7, 1997,
     a response which conceded that some administrative errors were
     made in processing Wilton and Hollis' toll provider filings. 
     Because of the facts of these particular filings, Staff
     recommended granting the Motion to Dismiss.  It also recommended,
     however, that the Commission investigate the overearnings of
     Wilton and Hollis and the companies' use of overearnings to
     subsidize their toll rates.  
         We are persuaded by Wilton and Hollis' recitation of 
     the facts that it would not be appropriate to further pursue
     fines for their actions in becoming the designated toll provider
     in their franchise areas.  We will, therefore, grant the Motion
     to Dismiss.  We make no ruling regarding the right, if any, of a
     utility to a jury trial in an instance such as this.
         We will grant Staff's request that it continue to
     review the two companies' overearnings and use of those excess
     earnings to subsidize their toll rates.   We direct Staff to
     report to the Commission the results of that review within 60
     days of this order. 
         Based upon the foregoing, it is hereby
         ORDERED, that the Motion to Dismiss filed by Wilton and
     Hollis is GRANTED; and it is
         FURTHER ORDERED, that the Staff review the overearnings
     of the two companies and use of those excess earnings and report
     the results of that review within 60 days of this order.
         By order of the Public Utilities Commission of New
     Hampshire this sixth day of January, 1998.
     
     
                                                                     
        Douglas L. Patch    Bruce B. Ellsworth        Susan S. Geiger
            Chairman           Commissioner            Commissioner
     
     
     Attested by:
     
     
                                      
     Thomas B. Getz
     Executive Director and Secretary