Proposed Bill Moves Michigan Closer to Landline Reform

Published March 18, 2011

A bill to reform Michigan’s 1991 Telecommunications Act regulating landline providers has moved to the state legislature’s House Energy and Communications Committee.

Introduced by Ken Horn (R-Frankenmuth), chairman of the House Energy and Communications Committee, on February 22, 2011, and cosponsored by Roy Schmidt (D-Grand Rapids), the Michigan Telecommunications Modernization Act (MTMA) updates, deletes, or repeals many provisions of the Telecommunications Act last revised in 2006. House Bill 4314 was introduced February 22, 2011, amended, and referred to committee on March 7.

“AT&T strongly supports House Bill 4314 and the work being done by Representatives Ken Horn and Roy Schmidt,” said Jim Murray, president of AT&T Michigan. “Their legislation balances many issues: It maintains important consumer protections; it does not change the obligations with respect to our competitors; it maintains the access restructuring reforms adopted in 2009; and it removes unnecessary and costly regulations.”

Limits Regulatory Authority

“HB 4314 will bring much-needed reform to the Michigan Telecommunications Act,” said Rep. Ray A. Franz (R-Onekama), a member of the Energy and Communications Committee. “As people move more and more toward wireless communication, the requirements of the 20-year-old law that regulates decreasing landline connections needs to be brought into the 21st century.”

The bill would limit the regulatory authority of Michigan’s Public Service Commission (MPSC), the agency responsible for administering and enforcing regulations on telcos. The MPSC would only be allowed to engage in rulemaking specifically enumerated in the existing act, and in most instances would not be able to introduce rules more stringent than current state and federal standards.

“Any rules promulgated by the MPSC before the bill’s effective date that are inconsistent with the limited rulemaking authority of this provision would be rescinded,” according to the bill draft submitted to committee.

The bill also establishes provisions for landline rates for the hearing-impaired who require special texting services, and for low-income customers identified as earning 150 percent of the federal poverty guidelines; makes printing and distribution of telephone directories voluntary as long as printed and electronic copies are made available; provides for mediation of disputes between carriers and prohibits disclosure of agreement terms without consent of both parties; and sunsets all rules in the bill after three years.

“HB 4314 will make the much-needed reforms while protecting connectivity and local problem resolution—key concerns of many local carriers,” said Franz. “These changes will allow landline carriers to remain competitive in a shrinking market, assuring landline viability.”

‘Updates Long Overdue’

“Six years ago, the Michigan Legislature took an important step and updated parts of the law governing landline telecommunications companies,” said AT&T’s Murray. “At the time, lawmakers recognized that updates were long overdue and desperately needed. Their work made Michigan’s law one of the country’s most progressive and led to large capital investment in Michigan,” he said.

“Six years later, neighboring states have caught up to Michigan and passed us by,” Murray continued. “Regulations from the era of monopolies no longer serve Michigan consumers in an era of competition, technology, and innovation. The MTA needs to reflect the realities of a competitive, consumer-focused, 21st century marketplace.”

‘Amazing Transformation’

Murray says the telecommunications industry is undergoing an “amazing transformation” from traditional landlines to wireless phones. “For AT&T, 62 percent of our landline customers have moved to new technology in the last 10 years,” he said.

“Today, communication options and services are evolving rapidly. Cable companies used to provide only cable service, and phone companies used to provide only phone service. Today, cable, wireless, and wireline companies offer voice, video, and data services,” he said.

“For the benefit of consumers and the choices they make, our law needs to reflect these changes. It’s the right legislation at the right time to help modernize Michigan’s law and make the state more attractive and competitive,” said Murray.

Bruce Edward Walker ([email protected])is managing editor of Infotech & Telecom News.

Internet Info:

“Testimony by Michigan Chambers of Commerce,” March 8, 2011:

“Michigan House Bill 4314,” Representative Ken Horn, February 22, 2011: