Ohio Consumers' Counsel: Proposed Telephone Rules Hurt Consumers

Apr 17, 2001, 01:00 ET from Ohio Consumers' Counsel

    COLUMBUS, Ohio, April 17 /PRNewswire/ -- Telephone rules proposed by the
 Public Utilities Commission of Ohio (PUCO) fail to protect consumers from high
 prices and a lack of competition, Consumers' Counsel Robert S. Tongren
 announced as he filed formal comments in the rulemaking case (PUCO Docket 00-
 1532-TP-COI).
     "The rules proposed by the PUCO eliminate important consumer protection
 standards that have resulted in fair, stable prices for many years," said
 Robert S. Tongren, Consumers' Counsel.  "With issues like poor service quality
 and the lack of telephone choices still a concern to millions of telephone
 customers across the state, under no circumstances should the Commission give
 up its responsibility to review rate hikes and hold companies accountable for
 their actions."
     The Ohio Consumers' Counsel (OCC), the residential utility advocate, was
 joined by AARP, City of Columbus, City of Toledo, Appalachian People's Action
 Coalition, Edgemont Neighborhood Coalition, Communities United for Action, and
 Empowerment Center of Greater Cleveland in filing comments on rules that would
 establish an Elective Alternative Regulation Plan.  Additionally, the City of
 Cleveland adopted these comments.  Once entered into by local telephone
 companies, the plan would limit the PUCO's authority to regulate and oversee
 all but the most basic of residential services.
     The proposed rules would allow local telephone companies to increase rates
 for services such as Caller ID, Call Waiting and second residential telephone
 lines without any examination of such price hikes.
     "Unless dramatically changed, the PUCO rules will allow unregulated
 monopolies to dominate the Ohio telecommunications marketplace," said Tongren.
 "That would be a big mistake."
     Specifically, the OCC's comments oppose:
 
     * Allowing telephone companies to increase costs for many commonly used
 services such as Caller ID, Call Trace and a second telephone line.  The rates
 for these services could double in price after three years with no competitive
 alternative for customers.  For example, Ameritech Ohio could raise the price
 of a second line from $14.25 to $28.50 and Caller ID from $5.75 to $11.50.
 Other services could be increased without limit.  Increases should not be
 allowed unless competition exists in the market or through a PUCO case to
 establish the need for such an increase in commonly used services.
     * Allowing telephone companies to raise rates without adequate notice
 given to customers.  Under the proposed rules, customers would be mailed a
 notice seven days before some increases.  There would be no notice required
 for other rate increases.  There should be one month notice before any
 increase goes into effect to give customers enough time to evaluate their
 options.
     * Ignoring a telephone company's service quality performance before
 allowing rate increases.  Before telephone companies are allowed to raise
 their rates for many services, they should be required to provide consumers
 with adequate service.
     * Allowing telephone companies to raise the rates of many services with no
 competitive environment.  The proposed rules suggest that increasing rates
 would encourage competing companies to enter the local telephone market, but
 this is a gamble.  There is no requirement that a competitive market would
 materialize.  Before a telephone company is allowed to substantially raise its
 rates, customers should have alternative companies available to provide these
 commonly used services.
     * Failing to include a process that a local telephone company would follow
 to adopt an alternative regulation plan.  This lack of process violates Ohio
 law.  There is no examination of telephone companies' operations, earnings or
 current rates either before or after granting them the ability to raise rates
 without proper oversight or accountability.  In order for the PUCO to allow a
 company to escape this oversight, it must examine the relevant facts in a full
 legal hearing and follow other statutory requirements.
     * Ignoring the fact that two local telephone companies, Ameritech Ohio and
 Cincinnati Bell Telephone (CBT), are currently operating under negotiated
 alternative regulation plans.  Allowing these companies to enter the proposed
 plan would violate those agreements.  Ameritech Ohio and CBT should not be
 eligible to raise rates for telephone services under any new alternative
 regulation plan until their current plans expire, in January, 2003 and June,
 2002 respectively.
     The OCC urges consumers to become informed and express their concerns to
 the PUCO.  "The PUCO needs to hear from consumers on this important issue,"
 said Tongren.  "That is why we have asked the Commission to hold local public
 hearings across the state."
     The OCC was joined by several consumer groups in a motion filed with the
 PUCO on March 19 to request the series of hearings.  Consumers are also
 encouraged to write the Commission to express their concerns.
     About the Ohio Consumers' Counsel
     The Ohio Consumers' Counsel (OCC) is the legal representative and
 residential consumer utility advocate serving as a resource for individuals
 who have questions and concerns, or would like more information about the
 services provided by their publicly owned electric, natural gas, telephone and
 water companies. The agency also educates consumers about utility issues and
 resolves complaints from individuals. To receive utility information
 brochures, schedule a presentation or file a utility complaint, residential
 consumers may contact 1-877-PICKOCC (1-877-742-5622) toll free in Ohio or
 visit the OCC website at www.pickocc.org .
 
 

SOURCE Ohio Consumers' Counsel
    COLUMBUS, Ohio, April 17 /PRNewswire/ -- Telephone rules proposed by the
 Public Utilities Commission of Ohio (PUCO) fail to protect consumers from high
 prices and a lack of competition, Consumers' Counsel Robert S. Tongren
 announced as he filed formal comments in the rulemaking case (PUCO Docket 00-
 1532-TP-COI).
     "The rules proposed by the PUCO eliminate important consumer protection
 standards that have resulted in fair, stable prices for many years," said
 Robert S. Tongren, Consumers' Counsel.  "With issues like poor service quality
 and the lack of telephone choices still a concern to millions of telephone
 customers across the state, under no circumstances should the Commission give
 up its responsibility to review rate hikes and hold companies accountable for
 their actions."
     The Ohio Consumers' Counsel (OCC), the residential utility advocate, was
 joined by AARP, City of Columbus, City of Toledo, Appalachian People's Action
 Coalition, Edgemont Neighborhood Coalition, Communities United for Action, and
 Empowerment Center of Greater Cleveland in filing comments on rules that would
 establish an Elective Alternative Regulation Plan.  Additionally, the City of
 Cleveland adopted these comments.  Once entered into by local telephone
 companies, the plan would limit the PUCO's authority to regulate and oversee
 all but the most basic of residential services.
     The proposed rules would allow local telephone companies to increase rates
 for services such as Caller ID, Call Waiting and second residential telephone
 lines without any examination of such price hikes.
     "Unless dramatically changed, the PUCO rules will allow unregulated
 monopolies to dominate the Ohio telecommunications marketplace," said Tongren.
 "That would be a big mistake."
     Specifically, the OCC's comments oppose:
 
     * Allowing telephone companies to increase costs for many commonly used
 services such as Caller ID, Call Trace and a second telephone line.  The rates
 for these services could double in price after three years with no competitive
 alternative for customers.  For example, Ameritech Ohio could raise the price
 of a second line from $14.25 to $28.50 and Caller ID from $5.75 to $11.50.
 Other services could be increased without limit.  Increases should not be
 allowed unless competition exists in the market or through a PUCO case to
 establish the need for such an increase in commonly used services.
     * Allowing telephone companies to raise rates without adequate notice
 given to customers.  Under the proposed rules, customers would be mailed a
 notice seven days before some increases.  There would be no notice required
 for other rate increases.  There should be one month notice before any
 increase goes into effect to give customers enough time to evaluate their
 options.
     * Ignoring a telephone company's service quality performance before
 allowing rate increases.  Before telephone companies are allowed to raise
 their rates for many services, they should be required to provide consumers
 with adequate service.
     * Allowing telephone companies to raise the rates of many services with no
 competitive environment.  The proposed rules suggest that increasing rates
 would encourage competing companies to enter the local telephone market, but
 this is a gamble.  There is no requirement that a competitive market would
 materialize.  Before a telephone company is allowed to substantially raise its
 rates, customers should have alternative companies available to provide these
 commonly used services.
     * Failing to include a process that a local telephone company would follow
 to adopt an alternative regulation plan.  This lack of process violates Ohio
 law.  There is no examination of telephone companies' operations, earnings or
 current rates either before or after granting them the ability to raise rates
 without proper oversight or accountability.  In order for the PUCO to allow a
 company to escape this oversight, it must examine the relevant facts in a full
 legal hearing and follow other statutory requirements.
     * Ignoring the fact that two local telephone companies, Ameritech Ohio and
 Cincinnati Bell Telephone (CBT), are currently operating under negotiated
 alternative regulation plans.  Allowing these companies to enter the proposed
 plan would violate those agreements.  Ameritech Ohio and CBT should not be
 eligible to raise rates for telephone services under any new alternative
 regulation plan until their current plans expire, in January, 2003 and June,
 2002 respectively.
     The OCC urges consumers to become informed and express their concerns to
 the PUCO.  "The PUCO needs to hear from consumers on this important issue,"
 said Tongren.  "That is why we have asked the Commission to hold local public
 hearings across the state."
     The OCC was joined by several consumer groups in a motion filed with the
 PUCO on March 19 to request the series of hearings.  Consumers are also
 encouraged to write the Commission to express their concerns.
     About the Ohio Consumers' Counsel
     The Ohio Consumers' Counsel (OCC) is the legal representative and
 residential consumer utility advocate serving as a resource for individuals
 who have questions and concerns, or would like more information about the
 services provided by their publicly owned electric, natural gas, telephone and
 water companies. The agency also educates consumers about utility issues and
 resolves complaints from individuals. To receive utility information
 brochures, schedule a presentation or file a utility complaint, residential
 consumers may contact 1-877-PICKOCC (1-877-742-5622) toll free in Ohio or
 visit the OCC website at www.pickocc.org .
 
 SOURCE  Ohio Consumers' Counsel