LoKT Telecom/Internet Law Blog

9.18.07 State Regulation and Legislation Update

California Considering State Broadband Fund: According to Jack Leutza, Communications Division Director at the California Public Utilities Commission, the CPUC is considering creating a broadband fund. The fund would create subsidies for providers to expand broadband into unserved areas.

New Hampshire PUC Considering Tough Conditions for Verizon/Fairpoint Deal: The New Hampshire Public Utilities Commission proposed eleven conditions on Verizon's $2.7 billion transfer to Fairpoint Communications. Among them are requirements for Verizon to assume some transition costs; impose buildout requirements on Fairpoint; bar local rate increases; continue all wholesale obligations currently applicable to Verizon for at least three years; and even require Fairpoint to appoint two New Hampshire representatives to the corporate board. The broadband buildout requirements would force Fairpoint to bring broadband to 75 percent of access lines in 18 months and 95 percent within 60 months. If the cost exceeded Fairpoint's planned $21.6 million expansion budget, Verizon would be required to cover the excess.

Nebraska Continues to Expand Regulatory Obligations on Non-Carriers: In the past six months, the Nebraska Public Service Commission has imposed regulatory obligations on non-carriers at a steady rate. The PSC imposed its state universal service fund on VoIP providers. It then imposed its state telecommunications relay service charge on VoIP providers. The PSC recently issued a "Communications Provider Registration Form" requiring VoIP providers and even ISPs to register with the PSC and pay a one-time fee of

Maryland Hits AT&T With Tax Penalty: The Maryland tax authorities have been auditing the books of telecommunications carriers in the past year. AT&T challenged a $5.2 million state assessment for its failure to pay tax on 900 services for 15 years. AT&T argued that it was exempt because it was a wholesale common carrier transport service. The tax authorities disagreed and were upheld by the court.

Tennessee Imposes 911 Service Charges on T1 and PRI Circuits: The Tennessee Attorney General's Office Issued an opinion regarding the proper calculation of 911 charge son T1s and PRIs. The opinion held that 911 charges apply to all digital channels in a T1 or PRI that are capable of carrying a voice call. So for a T1, up to 24 channels could each be subject to the fee, and 23 channels for a PRI.

9.11.07 State Update

Maine- The Maine PUC detariffed all CLEC retail services as well as ILEC retail bundles and long distance. Because the ILECs still control over 75 percent of the state's local access lines, the PUC will continue require tariffing of ILEC local services.
California- The California PUC simplified the requirements for carriers making changes to services and rate plans. Most advice letters will now go into effect the same day as filed. This applies to promotional offers, changes to services, or introductions of new services. Advice letters may be protested up to 20 days after filing.
Illinois- A court upheld an Illinois Commerce Commission ruling requiring three rural ILECs to negotiate interconnection agreements with Sprint. The rural ILECs are Harrisonville Telephone; Marseilles Telephone; and Metamora Telephone. The IL CC had ruled that the ILECs must negotiate ICAs with Sprint even though Sprint intended to use the ICAs to provide wholesale VoIP services.  The ILECs argued that such services were not common carrier services so they should be protected from interconnection by the Telecom Act of 96's rural ILEC exemption. The court ruled in favor of the IL CC and Sprint. Sprint benefited from the FCC's decision last March overruling the South Carolina PSC and Nebraska PSC's attempts to shield rural ILECs from interconnection with Sprint.
Maryland- The Maryland PSC is investigating Verizon's allegedly rising rate of service quality complaints. According to the MPSC, customer complaints about slow outage repairs has increased 50 percent this year, and Verizon has missed 20 percent of repair appointments. The MPSC was not happy with the first batch of documents produced by Verizon in the investigation and demanded additional information. Verizon then provided additional documents in an attempt to satisfy the MPSC's data requests.
West Virginia- The West Virginia PSC squashed an attempt by Level 3 to raise its intrastate access charges. Level 3 tried to raise its rates from less than a penny/minute to 3.3 cents/minute. For justification, Level 3 argued that it was simply charging tariffed rates of other carriers. The WV PSC rejected the attempt finding that Level 3 was selectively mirroring the highest charge in the state, not charging a reasonable amount.