This proposal delivers reduced benefits to all Ohioans, including the most vulnerable low-income consumers
Columbus, OH (Vocus) October 24, 2009
A diverse group of consumer advocates joined today as Ohioans Protecting Telephone Consumers (OPTC) to call for the defeat of deregulation legislation that allows rate increases for basic telephone services, weakens consumer protections and lowers service quality standards.
The formation of OPTC was announced at a press conference at the Ohio Statehouse. The group's members stand united against the passage of Senate Bill 162 and House Bill 276, which are backed by the telephone industry and would make sweeping changes to the pricing and oversight of Ohio's local telephone companies' services.
A number of organizations representing a variety of Ohioans make up OPTC, including seniors and low-income Ohioans. The members of the group include the Office of the Ohio Consumers' Counsel, Communities United For Action, AARP Ohio, Ohio Association of Community Action Agencies, Advocates for Basic Legal Equality, Appalachian Peace and Justice Network, Ohio Poverty Law Center, Citizens Coalition and Pro Seniors Inc. Group representatives said they will seek new members from other concerned citizen groups around the state.
"We are united in opposing legislation that allows annual rate increases to customers who rely on basic local telephone service while weakening the basic consumer protections and safeguards Ohioans have relied on for years," said Consumers' Counsel Janine Migden-Ostrander. "This legislation, which deregulates telephone service, provides multiple benefits to the telephone companies, while providing no benefit to the public."
"Ohio's seniors rely on landline service to connect with their family, doctors, emergency services and community," said Ron Bridges of AARP Ohio. "With decreased service quality, Ohio's elderly could be alone and without telephone service for several days with no way to call for help."
"Telephone companies should not be given three days to restore outages," said Bridges.
"Local telephone service is essential and consumers deserve to be protected from unjustified rate increases," said Ellis Jacobs of Advocates for Basic Legal Equality. "Some Ohioans could face telephone rate increases of up to 20-40 percent over the next few years, with no alternative."
"This proposal delivers reduced benefits to all Ohioans, including the most vulnerable low-income consumers," said Joe Maskovyak of the Ohio Poverty Law Center. "The current Lifeline telephone discount programs in Ohio are key to keeping service affordable. The legislation strips away protections against raising telephone rates for Lifeline customers, limits the access for eligible customers to easily obtain Lifeline assistance and guts the educational efforts needed to make consumers aware that help is available."
OPTC opposes Senate Bill 162 and House Bill 276 because the legislation:
- Allows all local telephone companies in Ohio to raise their monthly rates for basic telephone service by $1.25 every year. It also will create a new surcharge non-Lifeline customers would likely pay to cover a portion of the Lifeline discount. In some areas of the state, there is no alternative to landline telephone service, and only one provider offers this service. Therefore, some consumers will be faced with telephone rate increases of up to 20-40 percent over the next few years, with no alternatives.
- Weakens or removes consumer protections. The current Minimum Telephone Service Standards, which is a set of rules and consumer protections, would be eliminated and be replaced with weaker laws, leaving customers with fewer rights to address grievances. The Public Utilities Commission of Ohio (PUCO) would lose its authority to order automatic monetary credits for customers when telephone companies do not comply with certain standards. The legislation would adversely affect current consumer protections on such important matters as disconnection, reconnection and security deposits.
- Reduces low-income consumer benefits. Currently, hundreds of thousands of low-income Ohioans benefit from discounts on basic landline service through the Lifeline program. The proposed legislation limits the eligibility of Ohioans who can benefit from the Lifeline discounts, eliminates Lifeline customers' protection from rate increases and severely reduces the program's educational marketing efforts. Many eligible consumers will not be informed about the availability of a significant discount off the price of their basic local telephone service.
- Lowers service quality standards. For example, the period of time telephone companies have to restore out-of-service telephone lines increases from 24 hours to 72 hours. While current rules require telephone companies to provide automatic credits for outages of 72 hours or longer, the legislation takes away the PUCO's authority to order those credits automatically if this standard is not met. To be entitled to a credit, customers would need to file a formal complaint, including showing up in Columbus for a hearing. Being without service for many days put consumers, especially seniors and those needing emergency services, at risk and serves as a disincentive for phone companies to expeditiously restore service. This could lead to deterioration in overall service quality. Phone companies may cut jobs because they will be less compelled to repair service promptly.
- Fails to maintain consumer protections for customers with bundled telecommunications services. Customers who receive a bundle or package of telecommunication services do not receive the minimal safeguards described above in the legislation. For example, there is no time requirement for telephone companies to install bundles, restore outages or reconnect a customer who has been disconnected for non-payment. There also is no limit on the deposit the telephone company could charge to initiate telephone services. The only protection for bundled customers is that companies are forbidden from "unfair or deceptive" practices.
- Fails to provide commitments for broadband access to all Ohioans. Expanding consumers' access to broadband is important for economic development and job creation. Access provides customers with opportunities, including the ability to receive telephone and Internet service over a high-speed connection. However, the proposed legislation does not require telephone companies to invest in broadband services for rural Ohio.
"We are concerned about the lack of any commitments to increase broadband access to unserved communities," said Migden-Ostrander. "Under this legislation, the telephone companies get to deregulate basic local telephone service whether or not customers have other options, and nothing is provided to benefit customers."
OPTC's members urge consumers to contact their legislators immediately and let them know the importance of keeping telephone consumer protections. Details about how to take action are available through the "Read about new telecom legislation" link at http://www.pickocc.org.
Office of the Ohio Consumers' Counsel