Telephone Deregulation Measure Clears Senate
The state framework implementing federally mandated deregulation of the telecommunications industry cleared the state Senate Friday.
“There are some people that are nervous about this. But we don’t have a choice,” said Sen. John Hansen, R-Idaho Falls, a key member of the task force that drafted the measure over the past nine months.
With the assurance of state utility regulators that Idaho consumers are better off with the state-written deregulation scheme than one the federal government would propose, the Senate approved the bill on a 26-8 vote.
It will be returned to the House for ratification of a relatively minor amendment clarifying just when the current local exchange companies will become deregulated.
That amendment, more specifically defining the circumstances that will determine effective competition, was needed to convince holdout AT&T to drop its opposition.
The bill conforms state law to the requirements of federal telecommunications deregulation passed by Congress a year ago to inject competition into local exchange operations.
Critics claim it will raise residential rates and undermine the longstanding crusade to achieve universal service. But supporters - even the halfhearted - warned that rates will increase either way. They said the introduction of competition will end subsidies that residential ratepayers have traditionally enjoyed.
Among the bill’s major provisions:
The Idaho Public Utilities Commission will retain jurisdiction over rates for local telephone service until it determines that effective competition is present. Then rates will be deregulated.
Revenue from other sources, such as the Yellow Pages, may not be used to subsidize the cost of providing local services.
Rural telephone companies are essentially exempt for up to five years to give them time to prepare as much as possible for the prospect of outside competition.
Outside companies have two ways to get into a local market. They can build their own facilities or buy access from the existing carrier at 15 to 25 percent below the carrier’s normal charges as set by state regulators.
, DataTimes