Telecommunications Reports presents . . . . . TR's State NewsWire
February 2, 2001 2 P.M. Edition


STATES
MINNESOTA -- Gov. Ventura's bill to rewrite telecom law introduced
NEW YORK -- WorldCom won't receive 'recip comp' at tandem rate from
Verizon
OREGON -- Legislators propose Uniform Electronic Transactions Act
MISSISSIPPI -- PSC supports bills to restrict telemarketers
ILLINOIS -- Group is 'outraged' at Ameritech-backed telecom bill
NORTH DAKOTA -- Bill to speed up Qwest market-entry bid heads to Senate
floor
TENNESSEE -- Wireless phone charges would be limited under bill
VIRGINIA -- SCC to proceed with hearing on WorldCom prison phone rates
GEORGIA -- Bill would restrict use of wireless phones while driving
UTAH -- PSC seeks comments on service-quality rules

REGIONAL
SBC, Compaq partner to offer computers with DSL modems


FUTURE OF REGULATION
MINNESOTA
Gov. Ventura's bill to rewrite telecom law introduced

Rep. Ken Wolf (R., District 41B) has introduced HF 510 to enact Gov.
Jesse Ventura's (Independence Party, Minnesota) telecom plan.  The House
Regulated Industries Committee is scheduled to hold an informational
meeting on the bill Feb. 5.  The committee probably won't take any
action on the measure until March, a legislative staff member told TR.

The legislation would freeze all common carrier line charges (CCLC) and
cap the CCLC at 5 cents per minute of use on the bill's effective date.
The CCLC cap would be reduced gradually by 20% each year over five
years.  Rates for the switching element would be capped at two cents per
minute of use, and rates for transport would be frozen at current
levels.

HF 510 would direct the Public Utilities Commission to conduct by Dec.
31, 2002, a one-time major retail rate restructuring to establish
deaveraged retail rates.  After the restructuring was completed, there
would be a two-year freeze on all retail rates for essential telecom
services.

A universal service fund (USF) would begin Jan. 1, 2003, the same time
retail deaveraging would commence.  The bill would authorize $186.9
million to create the fund.  The base for the fund would be expanded
through a 5% excise tax on intrastate and interstate telecom services,
cable TV services, and satellite video programming services.

The measure would give the PUC authority to regulate cable TV franchise
operators.  Franchises would be granted and enforced at the state level,
but franchise fees would continue to be paid directly to local
governments.

Alternative form of regulation (AFOR) plans would be eliminated under
the bill.  The plans have failed to encourage dominant carriers to
invest in infrastructure, according to the Ventura administration.  Once
a complaint was filed by 5% or 500 consumers, whichever was less, within
an exchange, the Department of Commerce and the attorney general would
be authorized to investigate the rate and, if necessary, pursue relief
for the customer.  Rate complaints would be limited to essential or
noncompetitive services.

HF 510 would require the PUC to model its retail and wholesale service
quality rules after those in the current Qwest Corp. AFOR plan.  The PUC
would be given authority to impose severe penalties on companies who
failed to comply with commission orders pertaining to infrastructure
deployment.

The measure also would create an advanced service capital investment
revolving loan fund to finance the improvement, expansion, construction,
acquisition, and operation of telecom services.  The first year of
revenues from the proposed universal service excise tax would establish
the fund.

The bill's text is available at
http://www.revisor.leg.state.mn.us/cgi-bin/bldbill.pl?bill=H0510.0&session=ls8
2.




INTERCOMPANY COMPENSATION
NEW YORK
WorldCom won't receive 'recip comp' at tandem rate from Verizon

The Public Service Commission has ruled that WorldCom, Inc., has failed
to demonstrate that it deserves reciprocal compensation from Verizon New
York, Inc., at Verizon's tandem rate.

In 1999 the commission issued an order addressing whether traffic,
including Internet service provider (ISP)-bound traffic is "convergent,"
with lower termination costs, and whether it therefore should be
compensated at a lower rate.  (8/30/99 a.m.)  The solution was to create
a rebuttable presumption that a substantial portion of a carrier's
traffic is convergent if its incoming-to-outgoing traffic ratio exceeds
three-to-one for the most recent three-month period.

If a competitive local exchange carrier (CLEC) exceeds the set ratio,
the PSC determined, it should be compensated at the lower Verizon
end-office rates, not the higher tandem rate.  To rebut this
presumption, a CLEC must show that its network and service are such that
the higher tandem rate is appropriate despite exceeding the ratio.

On July 24, 2000, WorldCom filed a petition asserting that its network
and services qualify it for the higher rate.  WorldCom asserted that the
networks of its New York operating companies--MCI Metroaccess
Transmission Service LLC, Brooks Communications of New York, Inc, and
MCI WorldCom Communications, Inc.--when taken as a whole, more than
qualify for tandem reciprocal compensation.

WorldCom said its combined network doesn't exceed the three-to-one
incoming-to-outgoing traffic ratio.  Even if it does exceed the ratio,
WorldCom asserted, the network meets the requirements to rebut the
presumption because it has "tandem-like functionality in both the
transmission and receipt of traffic,"

The PSC, however, agreed with Verizon's position that WorldCom can't
aggregate all of its operations to rebut the presumption that it should
receive the lower end-office rates.  The PSC said that because WorldCom
didn't "identify the facilities or operating territory of the individual
companies, or indicate whether the operating entities are integrated,"
the PSC had no basis to decide whether the companies individually offer
efficient tandem-like interconnection "despite their overwhelmingly
convergent traffic ratios."  (Case no. 99-C-0529, Proceeding on Motion
of the commission to reexamine reciprocal compensation)



INTERNET
OREGON
Legislators propose Uniform Electronic Transactions Act

Reps. Susan Morgan (R., District 46), Tim Knopp (R., District 54), and
Jeff Merkley (D., District 16) have introduced a bill to create the
Uniform Electronic Transactions Act.  HB 2112 would prohibit parties
from denying a record, signature, or contract legal effect or
enforceability solely because it was in electronic form.

HB 2112 stipulates that parties could refuse to conduct transactions
electronically.  No person would be able to waive the right to refuse to
conduct electronic transactions.

The director of the department of administrative services would have to
determine whether, and to what extent, a government agency could create
and retain electronic records.  The director also would have to
determine whether, and to what extent, a government agency could send
and accept electronic records and signatures.

HB 2112 awaits consideration by the House Judiciary Committee's
subcommittee on civil law.



CUSTOMER-AFFECTING
MISSISSIPPI
PSC supports bills to restrict telemarketers

The Public Service Commission has said it supports two bills to prohibit
telemarketers from calling consumers who joined a "no-call" list.  SB
2362, sponsored by Sen. Thomas E. Robertson (R., District 51), and HB
1414, introduced by Rep. Les Barnett (R., District 116), would require
the PSC to maintain the no-call list.

According to the PSC, nearly 400 consumers in the past two months have
asked the commission to help curb telemarketing.  SB 2362 and HB 1414
"would assist the consumers to greatly reduce or eliminate unwanted
telemarketing calls," PSC Chairman Nielsen Cochran said.  He urged
consumers who support the measures to ask their legislators to vote in
favor of the bills.

While critics argue that the bills are antibusiness, Cochran said a
no-call list actually could help telemarketers by screening out
consumers who wouldn't be receptive to the calls.  Similar legislation
is already in place in 14 states, including Alabama, Arkansas, Florida,
Georgia, Kentucky, and Tennessee.  Telemarketing appears to have become
more successful in these states as a result, according to Cochran.

SB 2362 has passed the Senate Public Utilities Committee and is expected
to reach the Senate floor by Feb. 8, a legislative staff member told
TR.  (1/18/01 p.m.)  HB 1414 has been referred to the House Public
Utilities Committee.



STATE & LOCAL GOVERNMENT
ILLINOIS
Group is 'outraged' at Ameritech-backed telecom bill

The Illinois Coalition for Competitive Telecommunications (ICCT) today
said it's "outraged" at a bill introduced yesterday to rewrite the
telecom article of the state's Public Utilities Act.  (2/2/01 a.m.)
Connect Illinois, a group that counts Ameritech-Illinois as a member,
backs the legislation.  ICCT's membership includes AT&T Corp., the Cable
Television and Communications Association of Illinois, and Focal
Communications Corp.

ICCT noted that one of the "more interesting" parts of HB 492/SB 134 is
that it retains regulation over the most basic residential service for
two years but immediately deregulates additional services to residential
customers.  "This means that for the next two years there will still be
caps on rates for one basic phone line per household, but Ameritech will
be free to make unlimited rate hikes on common services such as a second
line, call waiting, and voice mail," ICCT said.

Gary Mack, executive director of ICCT, said, "The fact that Ameritech
had the audacity to propose this bill after months and month of
skyrocketing customer complaints is just further proof that the General
Assembly needs to take strong action when it rewrites the state's
telecommunications law this year."



LONG DISTANCE
NORTH DAKOTA
Bill to speed up Qwest market-entry bid heads to Senate floor

The Senate Committee on Business, Industry, and Labor has passed and
sent to the Senate floor a measure to urge the Public Service Commission
and the FCC to move forward "as quickly as possible" on Qwest Corp.'s
bid to enter the in-region interLATA (local access and transport area)
service market.  (1/17/01 p.m.)  The measure likely will be heard on the
Senate floor sometime next week, a legislative staff member told TR.

According to SCR 4008, granting Qwest market-entry authority under
section 271 of the federal Telecommunications Act of 1996 would prevent
the state from lagging behind other states in the local and long
distance markets.



WIRELESS
TENNESSEE
Wireless phone charges would be limited under bill

Sen. James F. Kyle (D., District 28) has introduced a bill to make it an
unfair or deceptive act for wireless phone providers to charge for calls
in increments of more than one-tenth of a minute.  SB 586 also would
prohibit telecom providers from charging for calls received on a
wireless phone.  The bill's text is available at
http://www.legislature.state.tn.us/bills/currentga/BILL/SB0586.pdf.

Rep. Craig Fitzhugh (D., District 82) has filed an identical bill, HB
801, in the House.  Its text is available at
http://www.legislature.state.tn.us/bills/currentga/BILL/HB0801.pdf.



PRICING
VIRGINIA
SCC to proceed with hearing on WorldCom prison phone rates

The State Corporation Commission has decided to proceed with a Feb. 14
hearing to examine the rates charged by two Virginia subsidiaries of
WorldCom, Inc., for service provided to the state's inmate telephone
system.

The commission had asked for comment on whether to proceed with the
hearing after learning that one of the petitioners, Robert E. Lee Jones
Jr., filed a complaint concerning the matter in the federal district
court in Roanoke, Va.  Jones' federal suit named the commission as a
defendant, in addition to the defendants already named in the SCC
proceeding.

The SCC's investigation began last year when two Department of
Corrections inmates complained that the rates WorldCom charges for
collect calls placed by inmates are too high.  The inmates also allege
that the rates are "inconsistent" with a tariff filed by the company in
January 1999.

The commission also rejected renewed requests by the WorldCom companies
to dismiss the case on jurisdictional grounds and a request by Jones for
summary judgment.  (Case no. PUC990157, Robert E. Lee Jones Jr. v. MCI
WorldCom Network Services of Virginia, Inc., and MCI WorldCom
Communications of Virginia, Inc.)



WIRELESS
GEORGIA
Bill would restrict use of wireless phones while driving

Rep. Barbara J. Mobley (D., District 69) has introduced HB 335 to
prohibit driving while using a wireless phone unless the device was
equipped for hands-free use and allowed the driver to hear surrounding
noise out of one ear.

HB 335 has been referred to the House Committee on Motor Vehicles.  Its
text is available at
http://www.legis.state.ga.us/Legis/2001_02/sum/hb335.htm.



CUSTOMER-AFFECTING
UTAH
PSC seeks comments on service-quality rules

The Public Service Commission has asked for comments by March 19 on
proposed retail service-quality rules, most of which would apply only to
Qwest Corp.  This is the commission's second round of formal comments on
the rules, which may take effect March 20.  (1/25/01 p.m.)

The proposed rules seek to codify service-quality conditions included in
the commission's order approving the Qwest Communications International,
Inc.-U S WEST Communications, Inc., merger.  The proposed rules would
require Qwest to complete 90% of all new, transfer, and change orders
within three business days or on the customer's requested due date.
Beginning in July, the company would have to complete 95%.

The issues addressed in the draft rules also include held orders,
repairing out-of-service lines, missed commitments, reporting
requirements, billing, and disconnection.  (Docket no. 00-R340-01, In
the Matter of a Proceeding to Adopt Rules Governing Service-Quality
Standards to End Users for All Tariffed Public Telecommunications
Services Pursuant to UCA 54-8b-3.3 (6)(a))



ADVANCED SERVICES
ARKANSAS, CALIFORNIA, CONNECTICUT, ILLINOIS, INDIANA, KANSAS, MICHIGAN,
MISSOURI, NEVADA, OHIO, OKLAHOMA, TEXAS, WISCONSIN
SBC, Compaq partner to offer computers with DSL modems

SBC Communications, Inc., has reached a deal with Compaq Computer Corp.
to offer customers a discount on one of three computers that include a
digital subscriber line (DSL) modem.  The discounts range from $250 for
a low-end computer to $500 for a high-end computer.

The company also ended a promotion it began last February, which
effectively raised the price for DSL by $10.  Customers now will have to
pay $49.95 a month.  However, SBC ended its practice of requiring
customers to enter into a one-year contract.  If a customer decides to
sign a one-year contact, the $99 DSL modem will be provided for free.



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