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from: Palm Beach Post

Phone companies' boost targeted by lawmakers

By Kristi E. Swartz
Palm Beach Post Staff Writer

Wednesday, March 14, 2007

TALLAHASSEE — Lawmakers are pushing Florida's telephone companies to forgo a scheduled increase in local phone rates as a way to sweeten a bill that would make it easier for them to get into the cable business.

Gov. Charlie Crist also wants the cable bill to make it easier for poor people who qualify for subsidized phone service to actually get it.

Rep. Juan Zapata, R-Miami, said he is considering amending a cable bill to eliminate the last of three rate increases the state allowed then-BellSouth Corp., Embarq and Verizon under a law passed in 2004. The first increase - an extra $1.13 for local phone service for BellSouth customers - took effect in 2005, and the next - another $1.13 for BellSouth - occurred in 2006. The last - 88 cents for BellSouth - is scheduled for the end of 2007.

Don Sadler, spokesman for AT&T-Florida, which bought BellSouth last year, said he hadn't heard Zapata's proposal.

Led by Verizon and AT&T, the telephone companies are now fighting to be allowed to quickly enter the cable television business in Florida. They say they are now at a disadvantage with cable companies, many of which aggressively market a bundled package that includes phone and high-speed Internet service.

The phone companies want lawmakers to change the system, which now requires them to offer exclusive franchise agreements to each city where they want to offer service. The heavily lobbied cable bill (HB 529) would instead require companies wanting to offer cable to get a statewide license that would allow them to offer service anywhere they wanted. This would allow companies to bypass local governments, which often negotiate fees for themselves, and could create situations where customers could choose between competing cable providers.

The bill, which is opposed by cable companies and local governments, is scheduled to go before the House Policy and Budget Council on Friday and then to the House floor the following week.

The bill's sponsor, Rep. Anthony Traviesa, R-Tampa, didn't make a commitment Tuesday about whether he supported a plan to stop future phone rate hikes.

"I'm looking at it hard and seeing if there's something that we can do that works for everybody," he said. "We're trying to help consumers here, and there may be a way that works for everybody."

He also said he would consider Crist's request to amend the bill to make it easier for poor people to sign up for Lifeline, a federal discount phone program that cuts $13.50 a month from their local-phone costs.

"The governor is aware of (the cable bill) and the consumer benefits to competition, and related to that he has a priority with Lifeline and asks that I support that," Traviesa said.

Crist joined two dozen AARP-Florida members Tuesday to support a House and Senate proposal that would require the Department of Children and Families to automatically register people for Lifeline if they are eligible for other services such as food stamps or Medicaid.

Nearly all Floridians pay for Lifeline through a monthly phone fee that goes to the Universal Service Fund. However, because so few people in Florida - 13 percent of the more than 1 million who are eligible - are signed up for Lifeline, most of the state's contribution goes to subsidize phone programs in other states.

"Lifeline is a great program, but more people need to know about it," Crist said. "For many of our citizens, it truly is a lifeline. For many people the only way they can communicate with a loved one is that telephone."

Sen. Nancy Argenziano, R-Dunnellon, who is sponsoring a Lifeline bill (SB 2368), said she hasn't made up her mind on the cable-franchise issue but would rather her bill stay the way it is because she wouldn't want it to die with the cable bill if that bill were to be defeated.

A similar stand-alone Lifeline bill failed last year.