FairPoint seeks telephone fee increase for Maine customers

Bangor Daily News file photo

Wes Dempsey of FairPoint Communications finishes work on a cable line in an east side Bangor neighborhood in 2009.

AUGUSTA — FairPoint Communications is asking state regulators to increase the fee Mainers pay on their telephone bills to help subsidize the basic telephone service the company is mandated by law to provide.

The Charlotte, N.C.-based company has asked the Maine Public Utilities Commission to approve two requests that would help cover the cost of providing what’s known as “provider of last resort” service.

The basic telephone service the state mandates should be available to any customer costs $67.6 million more than the revenue FairPoint is able to generate, according to the company’s filing. FairPoint claims it has 29,000 residential and business customers who pay for this service in the state.

To make up that shortfall, FairPoint is asking the Maine Public Utilities Commission to provide it with $66.9 million from the Maine Universal Service Fund, which has traditionally been used to help small rural telephone providers cover the cost of offering telephone service and funded by everyone in the state who pays for voice service, including landlines, cellphones and pager services.

According to some initial calculations from the Maine Office of the Public Advocate, FairPoint’s request would mean a person paying $75 per month for cellphone service would see their bill increase by $5 per month.

FairPoint has never received money from the fund because it was felt the company had a large enough customer base “to spread around the pain,” Jeffrey Nevins, FairPoint’s spokesman, said Tuesday.

The fund only collects about $8.3 million a year in fees from Maine residents, which means that if FairPoint’s request is approved, the total annual amount collected from Maine contributors to the fund would need to increase from $8.32 million to $75.2 million.

That’s “a very big ask,” Tim Schneider, Maine’s public advocate, said Tuesday.

The Maine Legislature considered a bill last session that would give FairPoint access to the state’s Universal Service Fund, “and declined to do so,” Schneider said.

“We would be surprised if the commission agreed to FairPoint’s interpretation without the Legislature weighing in on this question,” Schneider said.

The idea behind provider of last resort service goes back to the telecommunication industry’s infancy, according to Nevins. The idea was that urban customers in densely populated areas would help subsidize the cost of providing telephone service to customers in rural areas.

However, that theory no longer works as more people drop landlines in favor of cellphones. Additionally, there is competition from companies like Time Warner and Comcast, neither of which are mandated to have provider of last resort service, Nevins said.

“We have fewer and fewer landlines, so in terms of being able to balance it out to spread the burden, there’s less of a chance to do it because there’s fewer people,” Nevins said. “The thought was if you’re a large provider, you could spread the pain among those you’re serving. Because of what’s happened in the competitive marketplace, we want them to consider offering up Universal Service Funding to meet that gap for us. … FairPoint is generally asking to be treated like other telephone providers.”

FairPoint is also asking the Maine Public Utilities Commission to approve a $2 rate increase on those 29,000 residential and business customers who use provider of last resort service. Specifically, that translates to an increase from $14.69 to $16.69 for residential service and from $32.28 to $34.28 for business customers, according to the company’s filing.

“I think the $2 rate increase at first glance appears reasonable and is consistent with what FairPoint’s competitors are charging,” Schneider said.

He added that with FairPoint’s filing, the question is how much should Mainers have to pay to provide basic telephone service.

“It’s really important to identify what that cost is,” he said, “It’s a really fundamental question whether we as a state want to continue providing the service and at what cost.”

What do you think of this story?

Login to post comments

Our policy prohibits comments that are:

  • Defamatory, abusive, obscene, racist, or otherwise hateful
  • Excessively foul and/or vulgar
  • Inappropriately sexual
  • Baseless personal attacks or otherwise threatening
  • Contain illegal material, or material that infringes on the rights of others
  • Commercial postings attempting to sell a product/item
If you violate this policy, your comment will be removed and your account may be banned from posting comments.

Advertisement

Comments

UGH!!!!

Between BIW wanting a tax break and FairPoint wanting an increase where does it end...it's time for the people to get these damn breaks....enough with everything going up already...I work at BIW and I really see the greed in this company...I think FairPoint is just as greedy and it's time they stop trying to bleed us dry...we have no more to give...what part of that do they not get??? I get paid well but I still have nothing to see after all my bills are paid....and they want more...where will it come from??? we can't pull it our of our A@*...makes me ill

FRANK EARLEY's picture

Linda, I'm afraid............

I'm afraid what we're seeing here is the death throes of a dying chapter in the history of communications. The hard wired telephone is pretty much going the way of the, well, the telephone booth. At one time there was a real need for this type of communication, but like the telegraph, the technology is being quickly out paced by cell phones and voice over internet(voip). Unless they expand their array of products, there really isn't going to be a market for what they have to offer. There are just to many inexpensive alternatives out there, which in my opinion, work better. I remember when we were switching the phone systems out from analog to digital. We literally had to go house to house making sure that all the old "party line" ringers in the old phones, were replaced with a digital equivalent. That was just twenty six years ago or so. now all that technology is obsolete. I feel for the folks still employed in that particular service, but I don't feel dumping more money into this old system will keep it alive any longer. Time to hang up the wires with the old telegraph equipment, and move on....................................

Until there's a tower in

Until there's a tower in every town not matter how remote, and a 100% guaranteed clear signal in every home, there will always be a place for the landline. So they will be with us a long long time. I'm working on a project here in the Northeast Kingdom, about 6 miles from the Canadian border on Vt. There are certain schools that I can't use my cell phone in because they are hitting the Rogers towers in Quebec.

When hurricane Isabel came through Virginia 10 years ago, we lost power for 2 weeks, cell service for a week, and cable service for three weeks. But our landline never went out.

Considering the opposition to cell towers in some communities, it will be a long time before wireless service is as universal and reliable as landline service.

FRANK EARLEY's picture

Yes, as of 2013 that is,,,,,,,,,,,,,,,,,,,,,,,,,

You are correct as of right now. I'm afraid its a only a matter of time before existing towers new types of towers and satellite accessibility, will change over the next few years. Considering what we had twenty years ago, and where we are today, I'm not sure of the need for hard wire.
I do think the old copper pair will be with us for some time to come, but as for being a major player in the communication world, I don't know. I'm afraid all the effort is going into wireless, If you've ever had to install hard wired service to a new house five hundred feet from the feed, You would have to agree, if there was some sort of wireless application available, that would be my choice, especially if the weather is not cooperating...................

FRANK EARLEY's picture

One other thought I had.....

With all the alternatives to hard wired phone service, why is there a need to hard wire rural areas. I live on a dirt road in a very small town, and I have cable phone, cell phone, and internet. Why should we be paying extra for whats already available? Also, can anyone tell me, do the HW phone company's still charge for long distance?

 's picture

Question

I thought this article was about a telephone rate increase not about who had the most jobs or the most mud to sling, stick to the topic or take your thoughts to a private avenue.
The S/J needs to review more of these posts and delete the ones off topic, or else ban those that continue there personal rants.

FRANK EARLEY's picture

Time to rewrite the rules................

Hard wired land lines, are slowly becoming things of the past. I last had HW service eight years ago or so, and got rid of it because they couldn't fix the numerous problems I had with the line. Especially in large older buildings. Years of poor installation practices made for a mixed bag of spliced spaghetti in most basements. This I learned when working for a small phone company in Oxford County. In Canton and N Turner the areas I covered for a while, there were some pretty old structures with some pretty old wiring. Across Maine, there must be hundreds of thousands of dwellings like that. I know in my case in Auburn, the easiest fix and cheapest, was cable, or VOIT( computer) services. There are way to many interference sources nowadays, I don't think the old hard wired phone has much life left in it. I can't see pouring more money into a dying service.............

Bob White's picture

Who cares Frank

Who cares Frank

MARK GRAVEL's picture

"This I learned when working

"This I learned when working for a small phone company in Oxford County."

Okay, once I add "phone company" to the list of jobs you had, now I'm up to twelve. That is little over one job every 2.3 years. That is simply amazing!!! It is almost unbelievable.

FRANK EARLEY's picture

Are you brain dead or what.....................

First of all, what business is it of yours how many jobs I've had. You already tried proving I never drove truck, I don't suppose you'd be interested in coming by my house and try proving I wasn't a bouncer for many years also. This fixation you have with me is really creapy, Your threats to cut my disability benefits just proves to everyone, you have mental problems. I don't like mentally ill people posting comments or threats about me. Don't let the fact of where you live make you feel invincible, maybe I could have the SJ put an end to your bizarre ramblings. As much fun as this has been, I can't emphasize enough that you cease and desist from this constant harassment. Now, lets see if Dr Right or whatever your calling yourself now, has any brains to go along with that big mouth of yours. I hope you can take a hint.........................

Actually what Mark is really

Actually what Mark is really proving is how easy it is to press your buttons. The best way to deal with a lying troll is to withhold that which he so clearly craves: attention. Which, I have to say, you give him in spades. Before responding, take a few deep breaths, count to ten, then consider whether you really need to give him what he wants.

MARK GRAVEL's picture

Wayne, you are 100% correct.

Wayne, you are 100% correct. Yet, I get called a troll merely for having a different point of view. Moreover, they cannot control my thoughts or my words with insults or personal attacks, and that irritates those people.

Let me say that I don't lose any sleep over it.

JOANNE MOORE's picture

Frank.......

At least get the Sun Journal to tell us where the hell Roseville is! AND make him post using his real name. I have reason to believe he is not using his real name. There is a Mark on Alternet that is always denied to comment. Sounds like a troll to me.

MARK GRAVEL's picture

I'm glad you spend most of

I'm glad you spend most of your time thinking about this. It is sad that is all you have going in your life.

AL PELLETIER's picture

The kettle calling the pot....?

Grovell, you have slung so much bullshit about yourself since you started posting that you make Earley's 12 jobs record sound trivial.
Frank made a perfectly good comment about utility service and your sleazy little brain tried turn it into one of your usual pissing contest. You discuss me.

MARK GRAVEL's picture

I'm not going to get into a

I'm not going to get into a tit for tat discussion with you, but I suggest you review the pile of mud that Frank has slung my way. I never throw first mud; but I'm capable of returning fire.

Think about yourself and how many time you question the truthfulness of my assertions. Not that is a bad thing. Pointing out an observation that we have all noticed does shed light on the level of expertise on the subject matter.

That is all I'm going to say about that.

RONALD RIML's picture

"That is all I'm going to say about that."

For now. We never find your at a loss for words - only wisdom.

MARK GRAVEL's picture

Like an arm chair

Like an arm chair quarterback, you sit on your ass and talk about wisdom. How about demonstrating that of what you talk about, wisdom.

AL PELLETIER's picture

Don't bite, Ron

The Troll is doing what he does best, (next to serving Meals on Wheels in one of his 4 vehicles and serving in our arm forces during Desert Storm), he's trolling for another pissing contest.

MARK GRAVEL's picture

Let's get this straight. I

Let's get this straight. I post to Ronald, you find my post and make those comments. Please, tell the readers again who is the troll?

To me, it looks like you are trolling for big fish - America's Dr. Right.

RONALD RIML's picture

He's a Respected Member here.....

You be's a Wannabee.....

MARK GRAVEL's picture

Instance of kettle calling

Instance of kettle calling the pot...; If you what to talk about threats, there is plenty of self-crinination in your post.

I tell you what. I agree to never respond to any of your posts, if you make the same agreement.

What say you? Do we have an accord?

RONALD RIML's picture

You strike me as the type who has an accordion - and plays!!

FRANK EARLEY's picture

DEAL

...............

Jason Theriault's picture

FIGHT!

MARK GRAVEL's picture

Good emoticon...

Good emoticon...

Advertisement

Stay informed — Get the news delivered for free in your inbox.

I'm interested in ...