VIRGINIA:

     In the Supreme Court of Virginia held at the Supreme Court
Building in the City of Richmond, on Friday, the 29th day of
September, 1995.


American Association of Retired Persons
  and Virginia Citizens Consumer Counsel,                               Appellants,

against                 Record No. 950270
                        S.C.C. Case No. PUC930036

Bell Atlantic-Virginia, Inc.,
 United Telephone-Southeast, Inc.,
 Central Telephone Company of Virginia
 and State Corporation Commission,                                        Appellees.

           Upon an appeal of right from an order entered by the State
      Corporation Commission on the 18th day of October, 1994.



      Upon consideration of the record, the briefs, and the argument

of counsel, the Court is of opinion that there is no error in the

judgment of the State Corporation Commission.

      The Court concludes that the appellants' failure to object

before the Commission to the adequacy of notice of the proceedings

prevents consideration of this issue on appeal.

      The Court also concludes that evidence supports the decision of

the Commission, which was acting in its legislative capacity.

      Under Code § 56-235.5(B), the Commission must find that four

requirements are met prior to replacing the ratemaking methodology

set   forth       in    Code   § 56-235.2    with     any   alternative    form   of

regulation.       The Commission must find that the alternative form of

regulation (1) protects the affordability of local service, (2)

assures     the        continuation   of    quality    service,   (3)     will    not

unreasonably prejudice any class of customers, and (4) is in the
public interest.

        The testimony of Charles S. Parrott and Robert W. Woltz, Jr.

supports the Commission's findings that the affordability of rates

is   protected       and   that    quality    service    will    continue    under    the

alternative         form   of   regulation.      The     testimony     of   Richard   D.

Emmerson, William Irby, and Larry J. Cody supports the finding that

the alternative form of regulation will not prejudice any class of

customers.          The testimony of Robert G. Harris, Robert Woltz, Jr.,

and Charles S. Parrott supports the finding that the alternative

form of regulation is in the public interest.
        The testimony of Robert G. Harris and Richard D. Emmerson

supports the Commission's finding that safeguards against cross-

subsidization        between    competitive     services       and   monopoly   services

exist under the alternative form of regulation.                       The testimony of

Robert D. Willig supports the finding that the yellow pages are a

competitive service.              The testimony of Robert W. Woltz, Jr. and

Larry     J.    Cody       supports    the     determination         that   inside-wire

maintenance services are competitive.               The Court concludes that the

evidence       in    the    record    establishes       that    the    Commission     was

authorized under Code § 56-235.5(B) to use the alternative form of

regulation in lieu of the ratemaking methodology set forth in Code

§ 56-235.2.

        Because there is evidence to support the Commission's findings,

we affirm its judgment.            See Hopewell Cogeneration, et al. v. State
Corp. Comm'n, 249 Va. 107, 115, 453 S.E.2d 277, 281-82 (1995), Old

Dominion Power Co., Inc. of Virginia v. State Corp. Comm'n, 228 Va.

528, 532, 323 S.E.2d 123, 125 (1984).               The appellants shall pay to
the appellees thirty dollars damages.

     This   order   shall   be   certified   to   the   State   Corporation

Commission and shall be published in the Virginia Reports.
                                       A Copy,

                                             Teste:


                                                  David B. Beach,
                                                   Clerk
