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News Release
Analyzing SB 142: Commission Seeks A Better Way To Provide
High Cost Telecommunications Infrastructure

January 13, 1999 (1999-003)
Contacts: Ron Eachus, Commission Chair, 503 378-6611; Joan H. Smith, Roger Hamilton, Commissioners, 503 378-6611; Ron Karten, Public Information Officer, 503 378-8962
Salem, Ore. – The Oregon Public Utility Commission (OPUC) today said that there are better ways to encourage telecommunications infrastructure in high cost areas of Oregon than deregulating U S WEST and throwing away a potential $430 million in customer refunds and rate reductions.
The Commission heard today from advocates of SB 142, which creates a Telecommunications Infrastructure Fund for rural areas and allows companies like U S WEST freedom from regulation based on earnings if they contribute to the fund.
The bill also overturns a PUC decision in 1997 that reduced U S WEST rates by $97 million and ordered refunds to customers of $102 million. The decision is currently on appeal in the courts and the refund obligation has grown to $330 million.
Commissioners said they thought a broader-based, more equitable method of funding rural infrastructure was needed.
"The Commission is committed to working with high-cost Oregon communities to see that their telecommunication infrastructure needs are addressed," said Commissioner Joan H. Smith.
Terry Edvalson of the Rural Oregon Telecommunications Consortium said he wanted to induce phone companies to invest in rural Oregon. However, Commission Chairman Ron Eachus said SB 142 allowed U S WEST to "buy its way out of regulation" and enabled U S WEST to earn unlimited profits as a monopoly."
He said throwing out the potential for $430 million in ratepayer benefits was a "rape of ratepayers that leaves them violated and victimized without recourse."
The Commission said it will hold fact-finding hearings in high-cost Oregon communities seeking advanced telecommunications services. It intends to work with the variety of parties to develop legislation, and to carefully scrutinize the construction budgets of the regulated utilities.
"I sympathize with the goals of this legislation," said Commissioner Roger Hamilton, "but the process will not achieve those goals. It’s like tearing down the house to remodel a room."
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