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Easing phone rates is unsure

A disagreement between the House and the Senate could kill the politically popular proposal.

By JENNIFER LIBERTO
Published May 4, 2006


TALLAHASSEE - It was supposed to be a no-brainer, at least in an election year.

Both the House and the Senate unanimously passed a measure that would repeal a small part of a controversial phone rate bill that lawmakers overwhelmingly approved in 2003, which paved the way for the largest telephone rate increases in state history.

But the politically popular phone rate repeal has hit a speed bump. In the Senate's version of the legislation, there's a clause the House dislikes: expanding the responsibilities of the consumer advocate office that represents Florida utility customers before the Florida Public Service Commission.

The disagreement could kill the bill.

Even if the phone rate repeal becomes law, consumers will not see their rates drop from the heights they have reached recently following increases put through by Verizon, Sprint and BellSouth. Only a portion of the 2003 law would be repealed, the section that, beginning in 2007, permits phone companies to raise local phone rates by as much as 20 percent each year without PSC review.

The phone rate hike now under attack was passed despite the serious objections of many consumer groups. The groups, including the AARP, had argued that it effectively ordered the PSC to approve higher local phone rates and allowed a steady increase in rates year after year. Utility companies and many lawmakers said the law will bring greater competition that ultimately will lead to lower rates.

Now, the 2003 vote, and this year's attempt to repeal part of that law, is emerging as an election year issue. Some lawmakers have begun to criticize one another for the previous vote. And the AARP has vowed to remind its 2.7-million members to thank their lawmakers for the increased phone bills.

If the new measure, sponsored by Sen. Mike Fasano, R-New Port Richey, becomes law, then changes to basic phone rates would revert to the old system: phone companies could raise the price of their basic plans only once a year at the rate of inflation minus one percentage point.

Still, the legislation doesn't bother at least one of the big phone companies, said Bob Elek, Verizon spokesman. The idea of losing the authority to do 20-percent rate hikes in the future isn't a problem.

"We'd never really do that anyway," Elek said. "There's too much competition for us to do that anyway."

Besides, there are other things in the bill that phone companies really like. For example, the legislation cuts the filing process and notice time, from 15 days to one day, now required for a utility company to change prices for nonbasic rate plans, things like voice mail and call-forwarding. It allows companies to essentially send an e-mail to the PSC the day before they change their nonbasic rate plan.

The AARP hasn't taken a position on that change.

Yet, the bill's fate is uncertain. House Speaker Allan Bense, R-Panama City, has said he doesn't like the Senate's effort to strengthen the Office of Public Counsel. On Wednesday, the House stripped the public counsel language from the rate repeal, and sent it back to the Senate.

Senate leaders, meanwhile, feel strongly about strengthening the public counsel, said Sen. Lee Constantine, R-Altamonte Springs, who chairs the Senate committees on utilities. "We're committed to beefing up the public counsel and making it a stronger advocate for the consumer of Florida," Constantine said.

All sides say it's sure to be an issue decided by Senate President Tom Lee and Bense, maybe as late as Friday.

[Last modified May 4, 2006, 01:19:35]


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