Bill would deregulate Wis. landline phone service

Tue, 04/20/2010 - 8:10am
Ryan J. Foley, The Associated Press

MADISON, Wis. (AP) – State regulators would lose their ability to oversee rates for landline telephone service and investigate complaints of poor service under an AT&T-backed bill being debated in the Legislature.

The bill, introduced in February, is up for a vote in the Assembly on Tuesday. It would repeal a number of regulations on landline telephone providers, while eliminating the Public Service Commission's ability to investigate complaints of inadequate service or unfair charges or review the earnings and rates of providers.

Supporters, including AT&T and the cable industry, say the plan would modernize outdated regulations to respond to changes in the marketplace for phone service. They say it would create more options for consumers by increasing competition, and it would lead to more investment in new technologies such as broadband and cell phone towers.

But consumer advocates say the changes would hurt customers by driving up rates and removing protections, which may particularly hurt the elderly and rural citizens.

"It eliminates the regulations the Public Service Commission has used to ensure affordable and reliable landline telephone service for decades," said Charlie Higley, executive director of the Citizens Utility Board, who noted 3 million landlines still exist in Wisconsin.

He said the Public Service Commission has been the place for customers to complain about quality of their service, timeliness of repairs and concerns about charges, and "all that would go away."

Representatives of AT&T and the cable industry have donated more than $500,000 to candidates for statewide office and the Legislature since 2003, according to the Wisconsin Democracy Campaign, a watchdog group. And AT&T has more than a dozen lobbyists working in the Capitol, records show.

The plan has been on a fast track but ran into a key hurdle late last week when Senate Majority Leader Russ Decker referred it to the Legislature's budget committee for review. Because Thursday is the last scheduled day of the session, the maneuver might not leave time for its approval.

Decker's spokeswoman, Carrie Lynch, said Decker has concerns about the bill but did not elaborate. The move drew concern from industry lobbyists who have been working for months to get it approved.

"If it doesn't get done, that's going to be a huge missed opportunity for Wisconsin," said Thad Nation, executive director of Wired Wisconsin, a group partly funded by AT&T that says the bill will lead to more investment in the state by communications providers. "As other states move forward, Wisconsin will be left behind."

Rep. Josh Zepnick (D-Milwaukee), its author, said he wasn't sure what to make of Decker's move but predicted the plan would pass with broad support Tuesday in the Assembly. He said the bill is a response to the shrinking number of landline customers and the addition of new cable- and cellular-based phone options.

Although AT&T is one of the nation's largest cell phone providers, it says it is operating at a disadvantage against newer cell phone and cable companies that do not offer landline service, and therefore are regulated differently. One key change would eliminate a rule that bars AT&T and other landline providers to use revenue from that activity to subsidize other parts of their business.

The bill will free companies to spend more money expanding high-speed Internet access and adding wireless cell phone towers, Zepnick predicted. He acknowledged AT&T played a role in crafting the bill's language, but he said he ultimately decided what was included.

Despite the bill's elimination of Public Service Commission's consumer protection authority, Zepnick said the Department of Agriculture, Trade and Consumer Protection would retain the ability to respond to complaints. If rates rise too much, he said customers could easily switch to lower-cost competitors.

But Barry Orton, a University of Wisconsin-Madison telecommunications professor, said the deregulation would hurt elderly citizens who want to keep their landlines and some rural customers who have only one option for phone service. They won't have other options if their rates increase or their quality of service is poor, he said.

"This bill, in seeking to level the playing field, fires the referees entirely," he said.

Rep. Gary Hebl (D-Sun Prairie) said he would push for an amendment on Tuesday to restore the commission's authority to protect landline phone customers and another to extend that power to cell phone service.

"If a service provider is not doing their job, consumers should have recourse. That's one of our jobs as legislators," he said. "We have to be sure that consumers get the service they paid for and it's properly provided to them."

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