(JUNEAU) - The Alaska House of Representatives passed changes to how the Regulatory Commission of Alaska regulates telecommunication industry on Monday. House Bill 106, sponsored by the House Judiciary Committee, passed the House by a vote of 23 to 16 and by a reconsideration vote of 23 to 16. House Bill 111, sponsored by the House Rules Committee on request of the Governor, unanimously passed the House by a vote of 37 to zero and on reconsideration by a vote of 37 to zero. Judiciary Chair Rep. Lesil McGuire (R-Anchorage) said the committee spent a considerable amount of time on both bills.

"Our goal is to ensure that both a competing telecommunications carrier and an established carrier are on as level a playing field as possible," McGuire said. "These changes in statute work to keep an established carrier's charges fair and to hold competition to paying its share for the infrastructure that it uses."

Currently, a service area's established telecommunications carrier must allow a newer, competing carrier to use the infrastructure that the established carrier built. Meanwhile, the established carrier must also pay tariffs that the competitor is not obligated to pay. HB 106 holds the competing carrier to the same telecommunications tariffs as the established carrier, and, allows tariff exemptions for carriers in "competitive" service areas that have more than one carrier. In regards to service fees that an established carrier charges a competitor that uses its infrastructure, HB 106 allows the established carrier to base those fees on labor, equipment costs, and capital risks. As the infrastructure gets older, the established carrier must apply an accelerated depreciation rate to the fees that it charges to a competitor, which will encourage investment in new technology. Under HB 106, depreciation rates will be no higher than the standards set by the Internal Revenue Service.

"We're applying standards that have already been accepted on a nationwide level," McGuire said. "Competition is good for consumers; however, that competition must be fair for both carriers."

HB 111 extends the sunset date for the RCA to June 30, 2005. The RCA must hold public hearings and issue proposed regulations no later than November 15, 2003. HB 111 adds to the RCA's policy that it shall encourage competition in the telecommunications industry; however, the established carrier shall not be placed at a disadvantage. How competition will be regulated also depends on whether a service area that has more than one telecommunications carrier also truly has a competitive environment.

"We're leaving telecommunications regulation to the commission," McGuire said. "However, constant testimony from the industry has told us that the commission needs some new direction. That's a job for the Legislature. We are the elected policymakers, and our constituents are the very consumers who will benefit from both competition and a level playing field in the telecommunications industry."

HB 106 and HB 111 move to the Senate.

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05-19-03: House Judiciary Committee Chair Representative Lesil McGuire (R-Anchorage) explains why the legislature must make changes to how the Regulatory Commission of Alaska addresses telecommunications competition between established carriers and newer, competing carriers.

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Lesil McGuire 62 K

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