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Three legislators seek to limit law allowing record phone rate hikes

Consumer groups back the bay area lawmakers' effort, but colleagues aren't lining up in support.

By STEVE BOUSQUET
Published March 14, 2006


TALLAHASSEE - Backed by several consumer groups, three Tampa Bay lawmakers are pushing the Legislature to repeal key parts of a 2003 law that allowed record increases in basic monthly phone service in Florida.

Thte legislators, all Republicans, are Sens. Mike Fasano of New Port Richey and Nancy Argenziano of Dunnellon, and Rep. John Legg of New Port Richey.

Their repeal efforts have the support of AARP, Florida Consumer Action Network, Florida PIRG, Consumer Federation of the Southeast and ACORN, an umbrella group that advocates for low-income people. But so far, there is scant support in the Legislature.

In 2003, lawmakers gave overwhelming bipartisan approval to a revamping of rates that included increases in residential service and a decline in long-distance rates. The industry leaders, including BellSouth, Sprint and Verizon, promised that consumers would benefit over the long haul because of increased competition for local service.

The first rate hike averaged $2.25 a month and began showing up in consumers' bills last November. But what lawmakers want to repeal is a provision that allows phone companies to impose additional increases of up to 20 percent a year without state approval.

"Let's call this what it is: a classic corporate giveaway that offers nothing to Florida consumers," Fasano said. "If the Legislature doesn't intervene, Florida consumers will continue to be victimized, with no end in sight."

Fasano said it is especially cruel for the state to allow higher phone rates when many people are already burdened by skyrocketing home insurance premiums.

This is the second time Fasano has tried to repeal the rate hike. His 2005 proposal was referred to the Senate Communications and Public Utilities Committee, where it never got a hearing.

The panel's chairman is Sen. Lee Constantine, R-Altamonte Springs, and the new bill has also been sent to his committee. He said other issues, such as energy and hurricane preparedness, are higher priorities at the moment, but he said the issue would be discussed in the current session. "We are going to look at competition, and whether that bill has promoted competition," he said.

Bob Elek, a spokesman for Verizon, which serves Pinellas, Hillsborough, Pasco, Polk, Sarasota and Manatee counties, said one condition of the 2003 law is that it did not promise additional profits to the companies.

Elek said proof of growing competition for phone service is that the company's number of access lines has fallen from 2.4-million in 1999 to fewer than 2-million today.

"Something's going on," Elek said. "Consumers have options."

Elek said his firm would not impose the maximum 20 percent rate increase allowed by the new law because of the threat of increased competition.

"We're not cable," Elek said. "We couldn't just have wanton rate increases every year and expect to retain the market. There are too many competitive options out there."

Argenziano scoffed at the notion of higher competition.

"Just think about it," Argenziano said. "If you are the telecoms, who have pretty much had a monopoly anyway, do you really want competition?"

Argenziano conceded that the phone companies have enormous clout in Tallahassee because of their generous campaign contributions to both political parties and to candidates. But, she said, that can be overcome if enough angry consumers pressure lawmakers or threaten to vote them out of office in the next election.

"What we've got going for us is people power," Argenziano said. "Keep the heat on."

The Consumer Federation of the Southeast launched a three-week run of TV ads Monday, urging consumers to complain to their lawmakers. "Enough is enough," the ad says. "Help pull the plug on unfair rate increases."

--Times researcher Tara-Lynne Pixley contributed to this report. Steve Bousquet is at sbousquet@sptimes.com or 850 224-7263.

[Last modified March 14, 2006, 00:53:05]


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