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LOUIS HAUPhone companies have been silent about the true cost of proposed rate changes. But MCI may have talked.
TALLAHASSEE - It's been the big secret of the debate over proposed local phone rate increases: How much would residential customers save from promised cuts for instate long distance calls?
Phone companies have said that information is confidential. But an MCI spokesman may have inadvertently revealed how big (or little) a share of savings home phone users can expect in testimony last week before the Florida Public Service Commission.
MCI insists it did not reveal any details. But a PSC transcript of Friday's hearing appeared to indicate otherwise.
The apparent slip is important because it sheds light on cuts in long-distance rates that are supposed to compensate for sharp increases in basic local rates sought by Verizon, BellSouth and Sprint.
The PSC is scheduled to vote on the rate increases today.
Under legislation signed into law in May by Gov. Jeb Bush, the local phone companies can sharply increase their local basic rates in exchange for corresponding cuts in the access fees they charge long-distance companies to complete instate calls.
Long-distance carriers are required to pass along the money they save from the reduced access fees to customers. For competitive reasons, the carriers have claimed as confidential the portion of the savings they would pass along to residential customers, as opposed to business customers. Nor have they provided any information on how much per-minute rates would fall for instate calls.
However, during questioning Friday, MCI senior manager of regulatory compliance Joseph Dunbar appeared to say that MCI intends to pass along 30 percent of its access-fee savings to residential customers in the form of lower rates and reduced fees. That means most of the savings would go to more lucrative business customers.
Consumer advocates have long warned that long-distance carriers would do just that. They argue that would hit residential customers with a double whammy since they would shoulder 86 percent to 93 percent of the increases in local basic rates; businesses with single-line phone service would pay the rest.
Immediately after Dunbar's remarks, commissioner Terry Deason stopped him, commenting that "I think we just disclosed some confidential information." Mike Twomey, an attorney representing AARP and Common Cause in the PSC hearings, said the same.
However, MCI attorney Donna McNulty countered that nothing confidential had been revealed. She said Dunbar was merely referring to the percentage of a particular customer fee that would be reduced in each year as part of the overall reductions in customer charges. PSC chairman Lila Jaber ultimately ruled that no confidential information had been released.
McNulty's explanation didn't convince Twomey, who said Monday that he still believes confidential information had been disclosed. "Once the bell's rung, you can't unring it," he said.
- Louis Hau can be reached at hau@sptimes.com or 813226-3404.