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Kentucky Preserves Basic Telephone Protections Despite AT&T Predation

Tue, April 30, 2013 | Posted by lgonzalez

Earlier this year we reported on SB 88 in the Kentucky legislature. The bill, sponsored by Republican Senator Paul Hornback and authored by AT&T, would have eliminated the "carrier of last resort" requirement and reduced consumer protections. A similar bill in 2011 was also defeated by a coalition of public interest groups.

This is one of a series of bills crafted by AT&T and ALEC that has been explained in great depth by the National Regulatory Research Institute in their 2012 review [pdf] as well as by Bruce Kushnick in this report [pdf].

Advocates on the side of consumers, including ILSR, were happy to see the bill defeated in the House. Though AT&T will undoubtedly be back again in future years, this victory shows the massive corporate carriers are vulnerable. In addition to blocking harmful deregulation, this is an example of how an organized coalition can protect the public interest.

I spoke with Mimi Pickering, Director of the Appalshop Community Media Initiative in Whitesburg, Kentucky. She described how local groups defeated the bill with the facts. Appalshop teamed up with nonprofit Kentucky Resources Council (KRC), AARP Kentucky, the AFL-CIO, Kentuckians for the Commonwealth, and several other groups. The coalition explained the complexities of the proposal and spelled out what could happen to landline service without consumer protections.

Appalshop Logo

KRC is an environmental advocacy group that helped stop SB 88 by providing critical research to educate the public and lawmakers. In Episode #44 of our podcast, Pickering and KRC Director Tom FitzGerald describe the coalition's work. KRC put the bill on its "Ugly" list early in the session and Fitzgerald dedicated significant time to analyzing the bill and spreading the word about its pitfalls. 

In a January Kentucky.com opinion piece, Fitzgerald described in detail how passage of the bill would affect households directly and indirectly. Pickering says his ability to translate legislative jargon was critical to the victory. By spelling out the likely outcomes for legislators and citizen groups, KRC and FitzGerald gave lawmakers the facts they needed to make informed decisions.

AT&T relied on a campaign of fear and misinformation. In contrast with FitzGerald's analytical opinion piece, AT&T Kentucky's President Mary Pat Regan penned a fluff piece about SB 88. She claimed the proposal would encourage competition and that residents already had abundant choice. Kentuckians, especially those in rural communities, knew better. Throughout, AT&T claimed that failing to pass the bill would result in Kentucky falling behind technologically.

Kentucky Resources Council

Kentucky media picked up on the story, perhaps anticipating an interesting replay of the 2011 battle. Kentucky Tonight with Bill Goodman, televised an interview with FitzGerald, an AT&T attorney, Ron Bridges from the AARP Kentucky, and the executive director of Citizens for a Digital Future (CDF), an astroturf group supporting the group. Pickering believes exposure from the show increased momentum and contributed significantly to the campaign.

CDF, an organization claiming to represent senior citizens, ran an aggressive robocall campaign to push the bill. FitzGerald investigated the roots of CDF and found their leading national member was AT&T. He describes another member organization, 60 Plus, as "Rove-esque."

The robocall strategy back-fired when legislators of targeted districts in eastern Kentucky took offense. The calls named legislators who opposed the bill and claimed they were trying to impede progress in Kentucky and circumvent the legislative process. Chairman of the House Tourism Development and Energy Committee and Speaker Pro Tem Larry Clark from eastern Kentucky knows how hard it is to get cell phone service in rural areas. He was particularly annoyed by CDF/AT&T's "heavy-handed" threats.

AT&T Wants to Gut Consumer Protections

AT&T and its allies also refused invitations to resolve problems with the bill. FitzGerald wrote several versions of a compromise proposal but AT&T would not give workable solutions the time of day. In the end, obstinance hurt their position.

When AT&T promised to increase its investment in Kentucky, FitzGerald looked at the numbers they supplied. He found no evidence for an increase beyond what they were already slated to invest. Lawmakers did not appreciate the wiley attempt to fool them.

Pickering, FitzGerald, and other leaders of the coalition used facts, education, and a willingness to cooperate to shed light on AT&T's dark motives. With a little media coverage, the strategy defeated millions of lobbying dollars. We know AT&T and other powerful telecommunications giants will continue to push for similar deregulation. However, this struggle in Kentucky can definitely be called a VICTORY for the public interest. 

Kentucky Coalition Takes Down AT&T Bill to Remove Consumer Phone Protections - Community Broadband Bits #44

Tue, April 30, 2013 | Posted by christopher

Episode #44 of our Community Broadband Bits podcast expands on our story exploring a major victory over bad AT&T-driven legislation in Kentucky. We welcome Mimi Pickering of Appalshop and Tom FitzGerald of the Kentucky Resources Council.

We discuss why the AT&T-authored bill to gut consumer protections was bad for Kentucky and how a terrific coalition of public interest groups, unions, and others were able to protect the public interest. This was the second time they have defeated a similar bill, offering important lessons to those of us in different states that have not yet abandoned basic consumer protections for the telephone just because AT&T told our legislature they were unnecessary.

We want your feedback and suggestions for the show - please e-mail us or leave a comment below. Also, feel free to suggest other guests, topics, or questions you want us to address.

This show is 36 minutes long and can be played below on this page or subscribe via iTunes or via the tool of your choice using this feed. Search for us in iTunes and leave a positive comment!

Listen to previous episodes here. You can can download this Mp3 file directly from here.

Thanks to Mount Carmel for the music, licensed using Creative Commons.

Kentuckians Once Again Fighting to Keep Landlines

Fri, February 22, 2013 | Posted by lgonzalez

Last year, we reported on the failed SB 135, which would have eliminated the "carrier of last resort" requirement in the state. The bill, sponsored by Republican Senator Paul Hornback would have let AT&T decide who could receive basic telephone service and would have limited consumer protections.

Last year's bill did not become law, but a progeny, SB 88, has already passed in the Kentucky Senate and was received in the House on February 15th. (We'd like to report what committee will hear it first but the Kentucky Legislative web has not yet published that information.) Senator Hornback is again the chief author of the bill, crafted by AT&T and its ALEC pals.

The Kentucky Resources Council (KRC) provides an analysis of SB 88 and a prognosis on how it would affect Kentuckians. KRC must be feeling deja vu, as are many organizations looking out for rural dwellers who depend on their landlines. These bills continue to be introduced year after year as large telecommunications companies spend millions of lobbying dollars, also year after year.

WMMT, Mountain Community Radio in Whitesburg, Kentucky, recently reported on the legislation. Sylvia Ryerson spoke with Tom Fitzgerald from KRC, who discussed the analysis. From KRC's report on the legislation:

At potential risk is the opportunity for existing and new customers, to obtain stand-along basic telephone services from the incumbent telephone utility, or “Plain Old Telephone Service (POTS)” as it is called. Those most adversely affected by this loss of access to basic, stand-alone, telephone service are those least able to obtain affordable and reliable alternatives – those who live in rural, lower density areas, and the poor in dense, urbanized areas who have no affordable alternative priced as low as POTS.

Kentucky Resources Council

The main concerns with the bill include:

Removal of power from the Public Service Commission to hear and resolve complaints about local exchange service. This would affect voice service, operator assistance, directory assistance, and accurate 911 assistance. Restoring lost service is often a waiting game for rural customers served by AT&T. With no where to go, customers can lose their connection to family and the outside world for even longer periods. As with many other provisions of this bill, the elderly are the biggest casualty. Healthcare matters are  often handled over the phone, including my dad's pacemaker monitoring.

In areas where there are more than 5,000 households, offering basic stand-alone service would be at the provider's discretion. Service could be terminated without prior regulatory approval if there are any other voice services offered to the customer, even if that service was from an affiliate. This lack of competition would likely lead to cost increases for people who cannot afford them. Another scenario would be the company's requirement for customers to bundle services, forcing those least able to afford it to purchase services they do not need or want just to get telephone service.

In communities where there are fewer than 5,000 households, the current providers (AT&T, Windstream, or Cincinnati Bell) could cease to offer stand alone landline service of there was available voice wireless service, even if that service was less effective for 911 purposes. Again, the "forced bundle" would be an issue.

They could also petition to be relieved of the obligation to provide basic telephone service if they meet certain criteria regarding the availability of voice services from other providers in the area. For example, if there is a broadband provider "capable" of providing voice services (contrasted with one that actually "does provide" voice services) the provider could be relieved of the obligation. Again, that "capable" provider does not have to offer the service as a stand alone, but may require bundling.

Providers can use any technology they wish if they decide to continue the "provider of last resort" obligation, which will make that obligation completely deregulated. This tactic is the backbone of the private sector's efforts to deregulate. For more on this strategy, we encourage you to listen to our conversation with Harold Feld on the 23rd episode of the Broadband Bits Podcast.

Telephone

For more detail on the bill, and all its shortcomings, take a few moments to review the detailed analysis by KRC. The full text of the bill, its amendments, and the status, are available on the Kentucky General Assembly website.

So what could be gained for Kentuckians by passage of such a bill?

From a Courier-Journal report by Joseph Gerth:

Proponents of Senate Bill 88 say the bill would allow companies like AT&T, Cincinnati Bell and Windstream to sink more money into expanding wireless broadband communications rather than costly old, outmoded land lines.

History shows us, however, that promises made by regulated companies today often end up as foggy memories tomorrow. We have seen time and time again how dergulation given in exchange for promises results in a breach of the social contract. This is known as Kushnick's Law:

"A regulated company will always renege on promises to provide public benefits tomorrow in exchange for regulatory and financial benefits today."

Rather than wait to be taken advantage of again, we encourge you to call the toll-free legislative message line 1-800-372-7181 and leave a message that will be delivered to all legislators. This is especially critical if you live in Kentucky, but legislation like this will march across all states if it passes here or elsewhere. 

Link: 
Kentucky.com Editorial Team Opposes Passage of SB 88

Ohio Legislation Threatens Rural Landline Phone Service

Fri, October 05, 2012 | Posted by lgonzalez

Once again, consumers must fight to preserve their landline telephone service. This time, the Ohio General Assembly is pondering legislation that can end traditional service for up to 1 million Ohio residents.

Our readers know about the efforts of ALEC and AT&T to drastically reduce their obligation to provide landlines across the country. Up to now, telephone companies were required to serve everyone, but those requirements are under attack, state by state. Bills have emerged in Mississippi, Kentucky, New Jersey and California.

The very real fear is that Ohio's Senate Bill 271 (SB271) will increase telephone prices, reduce service quality, and cause many to lose access to reliable 911 service. Many of those who still depend on landlines, include senior citizens. From an article on the Public New Service:

AARP Ohio State Director Bill Sundermeyer says, besides preserving social contact, land-line phones are needed to protect seniors' health and safety. For instance, some seniors use the phone line to transmit routine health information from equipment in their home to their doctor's office, he says.

"They can make an evaluation of a person's heart and how's it working, of their lungs, etc. That information would be very difficult to transmit over a cell phone."

(on a personal note, I can attest to this….my father routinely uses his landline telephone to send data to the clinic about his pacemaker to make sure it is functioning correctly)

The Office of the Ohio Consumers' Counsel (OCC) also expresses concern with the bill because it would allow telephone companies to stop providing local service in places labeled as "fully competitive." In the SB271 Fact Sheet (read the PDF, which offers a map of the qualifying areas), the OCC explains the problem with this definition:

Ohio Consume Council seal

To be considered “competitive,”
 a telephone company has to show that only two other companies provide service somewhere in the exchange, but not necessarily everywhere in the exchange. The other companies might not provide basic service, their services might not be comparable in price to the telephone company’s basic service, and their services do not have to be available to all customers within the exchange.

Although this test was designed for 
the single purpose of giving telephone companies limited flexibility in pricing customers’ basic service rates, SB
271 would give that competitive test
 an entirely new purpose. Telephone companies would be allowed to declare their entire service territory “fully competitive” if they have shown that all of their exchanges have passed this minimal competitive test—and then could begin withdrawing telephone service from customers in July of 2013 or 2014.

The bill would also allow telephone companies to use the cometititve test to avoid complying with current minimum service quality standards. If companies are exempted, they are not required to adhere to consumer protections regarding billing, repairs, and disconnections.

SB271, like similar legislation in other states, specifically limits Public Utilities Commission of Ohio's (PUCO's) authority to act on behalf of Ohio consumers. Under SB271, PUCO can no longer require a telephone company to serve any particular customer or group of consumers.

This is not the first strike at telephone regulations in Ohio. Two years ago, the Ohio General Assembly passed SB162. That bill allowed telephone companies to raise prices by as much as $1.25 each year for basic telephone service in exchanges that met the competitiveness test. One saving grace in SB162 was the requirement that a Select Committee be established to review the effects of SB162.

Whether or not that Committee will have the opportunity to meet and review the current environment is questionable. SB271 passed the Senate and is now under consideration by a House Committee.

[The coordinator for the Rural Broadband Policy Group, Edyael] Casaperalta says no new telecommunication matters should be introduced until that committee is formed and its report is complete.

"We should not even be considering another deregulation bill without first learning about what type of impact and assessing the impact of that first deregulation bill in 2010."

The Rural Broadband Policy Group is part of the National Rural Assembly, which works on a wide range of issues affecting rural America.

Public Service Commissioner Calls Mississippi Gov "Coin-Operated"

Tue, August 07, 2012 | Posted by christopher

We have watched in growing horror as AT&T and other telco lobbyists have gone from state to state gutting telecommunications oversight. In several states, you no longer have an absolute right to a telephone - the companies can refuse to serve you if they so choose.

We tip our hat to Phil Dampier at Stop the Cap, who alerted us to this story. AT&T convinced Mississippi legislators to remove consumer protections for telecommunications.

Northern District Mississippi Public Service Commissioner Brandon Presley is unhappy with a new state law that will strip oversight over AT&T. Presley plans to personally file suit in Hinds County Circuit Court against the law, calling it unconstitutional.

“It violates the state constitution,” Presley said of the bill during an interview with the Daily Journal. “There’s no doubt AT&T is the biggest in the state, and this bill will allow them to raise rates without any oversight at all.”

House Bill 825 strips away rate regulation of Mississippi landline service and removes the oversight powers the PSC formerly had to request financial data and statistics dealing with service outages and consumer complaints. The law also permits AT&T to abandon rural Mississippi landline customers at will.

As we've seen elsewhere (as in California), AT&T worked with ALEC to push this through - though Rep Beckett (R-Bruce) doesn't think AT&T will raise its rates or abandon parts of the state. Time will tell - but Beckett won't be the one to suffer when the inevitable occurs. Thanks to AT&T and ALEC, he already got his.

Rural Kentucky Telephone Access Threatened by Additional Legislation

Tue, March 13, 2012 | Posted by ejames

The National Rural Assembly, an advocate for America's hinterland, continues to track harmful legislation moving through the Kentucky Legislature. The assembly's Rural Broadband Policy Group in February publicized Senate Bill 135which eliminates the "carrier of last resort" requirement that big telcos provide basic phone basic and 911 service in rural Kentucky (Feb. press release on SB135). The bill's sponsor Senator Paul Hornback attempted to distance the negative publicity of SB 135 by crafting a new Senate Bill 12 with similar language.  SB 12 cleared a Senate panel today to the dismay of opponents.

After June 30, 2013, AT&T and other electing "Incumbent Local Exchange Carriers" (ILECs) would no longer be required to provide basic landline telephone service to all persons in a service area, and rural Kentuckians would no longer be assured of access to reliable basic phone service, including 911-emergency service. This bill would be especially harmful for rural people, because they are more likely to be in areas phone companies would decide not to serve, if given the choice. If the Kentucky bill succeeds, we expect major telephone companies to try similar bills in other states. The Rural Broadband Policy Group thinks that both bills need to be killed. After June 30, 2013, AT&T and other electing "Incumbent Local Exchange Carriers" (ILECs) would no longer be required to provide basic landline telephone service to all persons in a service area, and rural Kentuckians would no longer be assured of access to reliable basic phone service, including 911-emergency service. This bill would be especially harmful for rural people, because they are more likely to be in areas phone companies would decide not to serve, if given the choice. If the Kentucky bill succeeds, we expect major telephone companies to try similar bills in other states.

The Rural Broadband Policy Group thinks that both bills need to be killed. Possible repercussions:

  • Customers left at the mercy of a utility and its affiliated companies to raise the price for basic service in an area where no other competitor exists. 
  • Possible "redlining" of poor and remote communities where providing service is more costly or higher-maintenance. 
  • Strip the Public Service Commission of its authority to protect costumers by investigating complaints regarding basic telephone service quality.
  • Carriers could decide to abandon or retire their wirelines, resulting in loss of access to customers by the competitors.

These de-regulation measures are being crafted by AT&T and would also benefit competitors Windstream and Cincinnati Bell. (See our February story Kentucky Bill Could End Rural Telephone Service for Some.) In fact the Lexington KY Herald-Leader's John Cheves reported that Sen. Hornback was flanked by AT&T executives during the panel.  Cheves notes:

AT&T has significant clout in Frankfort. It employs 31 legislative lobbyists, including a former PSC vice chairwoman and past chairs of the state Democratic and Republican parties, spending about $80,000 last year on legislative lobbying. Its political action committee has given at least $91,000 in state political donations since 2007.

The committee voted 9-to-1 to approve the bill and send it to the Senate floor. The sole no vote came from Sen. Denise Harper Angel, D-Louisville.

 

Kentucky Bill Could End Rural Telephone Service for Some

Tue, February 28, 2012 | Posted by christopher

Kentucky is considering a bill that would significantly change rural telephone service in the state. An editorial examines in issue here. We signed on to a letter opposing the bill, reprinted below:

Dear Senate Standing Committee on Economic Development, Tourism, and Labor:

A harmful bill is before you this week that would cut basic telephone service to rural, low-income and elderly Kentuckians. Senate Bill 135, if approved in your committee, threatens access to what most consider a basic lifeline, including 911-emergency service, for Kentucky’s most vulnerable citizens.

As rural Internet and broadband advocates, we know the importance of having access to all forms of communication, including basic telephone service. Communication is a fundamental human right. Lack of basic telephone service isolates people and denies them the right to communicate. Without basic telephone service, rural people will be further isolated from economic and civic participation, and disconnected from the safety our nation’s vital emergency service network.

You have the power to ensure that all Kentuckians can continue to count on basic telephone service.

SB 135 would allow AT&T, Windstream, Cincinnati Bell, and other telecommunications companies to end their obligation as “carriers of last resort.” A Carrier of Last Resort is a telecommunications carrier that commits (or is required by law) to provide service to any customer in a service area that requests it, even if serving that customer would not be economically viable at prevailing rates.

Carriers of Last Resort are crucial to help people in rural, remote, and poor communities stay connected via basic telephone service. Because they are not profitable under a traditional market framework, these communities are the least desirable to corporations primarily interested in profits. The real tragedy of this bill is to further disadvantage the most vulnerable people in Kentucky by cutting their ability to communicate with their loved ones, elected officials, potential employers, medical providers and the society at large.

As rural constituents, we feel compelled to express our concern over the negative impact that SB 135 will have on rural, remote, and poor communities in Kentucky. Especially at a time when poverty rates are statistically high and jobs are scarce, Kentuckians cannot afford to lose yet another resource. We are extremely worried that SB 135 will:

  • Leave rural, low-income and fixed-income Kentuckians without access to basic phone service, including 911-emergency service.
  • Leave customers at the mercy of a utility and its affiliated companies to raise the price for basic service in an area where no other competitor exists.
  • Allow possible “redlining” of poor and remote communities where providing service is more costly or higher-maintenance.
  • Strip the Public Service Commission of its authority to protect consumers by investigating complaints regarding basic telephone service quality.
  • Carriers could decide to abandon or retire their wirelines, resulting in loss of access to vulnerable customers by the competitors.

We strongly believe that SB 135 needs to be stopped, and we respectfully encourage you to vote NO on this harmful legislation.

Instead of allowing corporations to walk away from the responsibility they accepted by receiving funds to become Carriers of Last Resort, we urge you to protect the most vulnerable and to stand up for the economic future of Kentucky. As leaders focused on economic development, tourism, and labor, you know that none of these sectors would be possible or sustainable if all Kentuckians are not assured basic and reliable phone service.

Additionally, consider that the places that currently struggle to get basic phone service are likely the ones with least or no access to wireless and broadband service to propel economic development.

Kentucky cannot afford to cut the cord on its people. If the state is to move forward with solid economic development, tourism, and labor plans, it must ensure 100% basic and reliable telephone access to Kentuckians.

For all the concerns and reasons expressed above, members of the Rural Broadband Policy Group, respectfully urge you to protect the most vulnerable Kentuckians and encourage you to invest in the future of Kentucky by voting NO on SB 135.

Sincerely,

Members of the Rural Broadband Policy Group