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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT PURSUANT TO SECTION 13 OR 15 (d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of report (date of earliest event reported): May 24, 1994
PACIFIC TELECOM, INC.
(Exact name of registrant as specified in Charter)
State of Washington 0-873 91-0644974
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File No.) Identification No.)
805 Broadway
Vancouver, Washington
(Address of principal 98668-8701
executive offices) (Zip Code)
Registrant's telephone number, including area code:(206)696-0983
No Change
(Former name or former address, if changed since last report)
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Item 5. OTHER EVENTS
The Federal Communications Commission (FCC) released a written order
on May 24, 1994, in which it adopted, with some modifications and
clarifications, the Final Recommended Decision (FRD) proposed last October
by the Federal-State Alaska Joint Board. (See "Part I, Item 1, Business -
Telecommunications Operations - Alaska Market Restructuring" on page 7 of the
Pacific Telecom, Inc. (Company) Annual Report on Form 10-K for the year ended
December 31, 1993.) The modifications suggested by various interested
parties and supported, in part, by Alascom, Inc. (Alascom), clarified AT&T
Communications, Inc.'s (AT&T) obligation to provide interstate Message Toll
Service/Wide Area Telephone Service (MTS/WATS) throughout all of Alaska and
to utilize the Bush service facilities of Alascom in meeting that obligation.
The FCC's written order also affirms Alascom's obligation to provide
interstate common carrier services on a non-discriminatory basis to all
interstate interexchange carriers (IXCs), under tariffs reflecting separate
rate schedules for locations subject to facilities competition (non-Bush) and
for locations where Alascom has a facilities monopoly (Bush). The costs of
service in each of these categories would be defined pursuant to a cost
allocation plan developed by Alascom and approved by the FCC.
Based upon the FRD, the FCC's order incorporated the following points:
The Joint Services Agreement between AT&T and Alascom would continue
in effect until January 1, 1996;
AT&T would make Accelerated Cost Recovery (ACR) payments to Alascom,
each in the amount of $75 million, on July 1, 1994 and December 31,
1995;
In the event Alascom was unable to provide a successor spacecraft to
Aurora II, the FCC would retain authority to order AT&T or another
carrier to provide such a facility;
Alascom would be required to file its cost allocation plan within 90
days of this order and to file its tariffs and cost support
information for common carrier services it would provide to AT&T and
other carriers 120 days before the scheduled effective date for the
tariffs of January 1, 1996, using the authorized interstate rate of
return applicable to local exchange carriers; and
The amount of interstate services that AT&T would be required to
purchase from Alascom during the transition period after January 1,
1996, would be adjusted by revenues, if any, associated with new
services purchased by other interexchange carriers and by the
proportion of the interstate MTS/WATS network use by Alascom.
The FCC also ordered AT&T and Alascom to request a ruling from the
Internal Revenue Service and the State of Alaska regarding the taxability of
the ACR payments. Should the payments be deemed nontaxable by those
authorities, the amount of the ACR would be reduced by the tax that otherwise
would have been payable by Alascom.
The Company believes the modifications made by the FCC improve upon
the FRD from a public interest perspective. However, the Company is
analyzing the impact of the order on its operations and is considering
whether to pursue further regulatory or judicial action. The Company intends
to act in a manner that will best serve its customers in Alaska and its
shareholders.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
PACIFIC TELECOM, INC.
(Registrant)
Date: May 31, 1994 By /s/James H. Huesgen
_____________________________
James H. Huesgen
Executive Vice President and
Chief Financial Planning
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