Settlement May Hike Phone Bills Us West Customers Could Be Charged $1.50 More A Month
Customers of US West Communications could pay an additional $1.50 per month for telephone service if Washington regulators approve an agreement announced late Monday.
The company, along with the staff of the Washington Utilities and Transportation Commission, and consumer and business representatives, negotiated timetables for retirement of its investment in everything from poles to switches.
The commissioners could take action on the settlement later this month.
US West has argued for several years that commission allowances for depreciation were too restrictive, particularly compared with those enjoyed by its competitors.
Slower depreciation means lower rates for consumers.
The company appealed a 1996 commission ruling on depreciation and several other issues to the Washington Supreme Court, which is expected to rule on the case this fall.
US West spokeswoman Dana Smith said the company could be liable for a refund in excess of $100 million, depending on which depreciation rate the court accepts.
Monday’s agreement provides for an increase in the depreciation rate to 7.4 percent from 6.2 percent. The change translates into an additional $36 million in annual revenues for the company.
By comparison, said US West spokeswoman Dana Smith, AT&T’s depreciation rate is 11.4 percent.
“We need this in order to maintain and enhance the telecommunications network in the state,” she said. “It’s still not fair.”
She added that the agreement also does not provide for any recovery of investment back to 1994, the period being contested in the Supreme Court.
Smith said US West will delay implementation of the rate hike - if approved by the commission - until the UTC staff completes an audit of the company’s books that could justify further adjustments.
The outcome of the Supreme Court case could dictate additional changes, she said.
US West serves about 2 million Washington residents.
, DataTimes