Lawmakers Open Telecommunications Door For Puds

Washington legislators tangled up in transportation issues are not ignoring the information superhighway.

Late last week, Senate and House committees headed by Spokane-area lawmakers cleared bills that would allow public utility and port districts to enter the telecommunications business.

State law now allows PUDs to sell only electricity, water, sewer and related services.

The twin measures were included in a package of proposals introduced by Gov. Gary Locke in an effort to modernize telecommunications and its oversight in the state.

Locke and development experts say rural areas will continue to trail the rest of the state economically if they cannot offer potential employers access to high-speed telecommunications.

But incumbent telephone companies have reacted strongly to a PUD push into the field, a move piggybacked in part on expansion of Bonneville Power Administration fiber-optic capacity in the state.

Lawsuits filed in Pacific and Douglas counties allege PUDs there are already providing phone service.

Also, several PUDs have formed a coalition, called the Northwest Open Access Network, that would lease BPA fiber and make it available to others. They are seeking a $10 million line of credit for capital and operating expenses.

The governor’s legislation would restrict PUDs and port districts to wholesaling fiber-optic lines. Other companies would continue to take the service into homes and businesses.

Both sides say they can live with the compromise, although how the data and voice calls would be handed off remains unclear.

“You have to work at it,” said Terry Vann, executive vice president of the Washington Independent Telephone Association.

Just because PUDs are in the utility business, he said, does not mean they have the skills to run a telephone company.

He said WITA members also fear the PUDs will subsidize their new telecommunications operations by shifting overhead costs to the electricity business.

But the bill approved by the Senate Energy, Technology & Telecommunications Committee Thursday requires separate accounting for phone and electricity operations.

Chairwoman Lisa Brown, D-Spokane, said the measure strikes the right balance between meeting rural telecommunications needs while ensuring equal business opportunities for PUDs and incumbent telephone companies.

She said she expects broad, bipartisan support for the bill, SB6675, in the Senate, but said uncertainties await in the House.

The House version, HB2880, emerged from the Technology, Telecommunications and Energy Committee co-chaired by Rep. Larry Crouse, R-Spokane, after an 11-1 vote Friday morning.

Lewis McMurran, government affairs director for the Washington PUD Association, said the group can accept a bill that does not completely open up the telecommunications market, a group goal in past sessions.

“When the governor gets behind one of your key issues, you don’t look a gift horse in the mouth,” he said.

If enacted, McMurran said, the bill will remove some of the uncertainty that has troubled financial markets where bonds to fund fiber-optic systems would be sold.