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In rush to deregulate, Senate tackles basic phone service

TALLAHASSEE — With only one in five Floridians still tethered to a traditional telephone, a Senate committee gave fast-track approval Monday to legislation that would completely deregulate land lines against the wishes of AARP and consumer advocates.

The move would do what dozens of other states have done: dismantle what's left of basic phone service regulation as the industry morphs at electronic speed. But customer groups say the measure, sponsored by Sen. David Simmons, R-Orlando, goes too far because it removes consumer protections if prices go up and access disappears.

It is one more in a pattern of legislation this session, they say, that weakens consumer protections to benefit industries.

"It is a threat to consumers that we see in so many pieces of legislation this year," said Charles Milstead, associate state director for AARP of Florida. "Deregulation is the name of the game at any cost.''

Consumer groups also worry about bills in the House and Senate that would raise utility rates to pay for renewable energy without regulatory approval, allow automatic insurance rate increases and remove consumer protections for nursing home residents, water users and insurers.

"It's not much of a battle because they seem to be getting everything,'' said Sean Shaw, who served as consumer advocate on insurance issues under former Chief Financial Officer Alex Sink.

Shaw has convened a coalition of public interests groups for a press conference at the Capitol on Tuesday to denounce these bills and others, including one that would allow Citizens Property Insurance Corporation to raise its rates.

Under the phone deregulation bill, regulators with the Public Service Commission would no longer monitor price and access to phone services for customers. Instead, the PSC would become a referee for disputes between competing companies.

Of the 18.8 million people in Florida, 26.1 million have telephone connections and yet just about 5.7 million have land lines, according to Simmons, the bill's sponsor. Of those, only 160,000 continue to carry the basic service, while the rest rely on bundled packages, or non-basic service.

"The vast majority of Floridians are using and moving toward unregulated products,'' Simmons said, just before the Senate Communications, Energy and Public Utilities Committee voted unanimously for his proposal. "The bill simply deregulates the remaining vestige of telecommunications left in the state."

Florida first deregulated telephone service in 1995, but allowed for protections for basic phone service to protect access for low-income residents and those in rural areas.

While AARP supports giving greater access to customers to telephone competition, spokesman Jack McRay said the Simmons bill could leave unprotected 162,000 Floridians who rely on basic telephone service.

He said a recent study of older Floridians showed that 4 in 10 struggle to pay the cost of their utility bills.

"This is no time to risk raising basic telecommunications costs on landline service,'' he said. "What we're talking about here is preserving a consumer choice which is essential for a segment of the population.''

But the industry countered that the final deregulation will lower costs and options for all.

"Without regulatory reform, Florida will have rotary dial laws in an iPhone world,'' said Marshall Criser, president of AT&T in Florida.

In keeping with the Legislature's focus on job creation, a coalition of industry groups formed the Citizens for a Digital Future and commissioned a study that predicts deregulation will create 143,405 new jobs in the future.

Mary Ellen Klas can be reached at meklas@MiamiHerald.com

In rush to deregulate, Senate tackles basic phone service 03/21/11 [Last modified: Monday, March 21, 2011 6:05pm]
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