The Kentucky House passed a bill Tuesday aimed at freeing telephone companies from maintaining their landline networks in urban areas, handing the industry a key victory in its long push for deregulation.
Industry executives say the result would spur more statewide investment in high- tech communications. The bill’s main sponsor said that would enhance Kentucky’s competiveness and job-creation efforts.
“It puts Kentucky in the right direction, encouraging increased investment in our state’s broadband infrastructure,” Rep. Rick Rand said of his bill, which passed the Democratic-led House on a 71-25 vote.
The issue has simmered in recent legislative sessions. It’s boiled down to debates over preserving old-fashioned landline phone service for those wanting it, while giving the industry the latitude to put more money into cutting-edge telecommunications technology. Swaths of rural Kentucky are still void of cell service.
Rand said the bill guarantees landline phone customers in rural areas can keep the service if they wish.
For rural landline customers switching to other service, the bill would give them a 60-day grace period to go back to landline service. The original bill gave customers 30 days, but Rand proposed the extended time.
The measure now heads to the Republican-run Senate. Sen. Paul Hornback, who has led the push for deregulation, said he will urge Senate GOP leaders to take up the House-passed bill.
“It’s a bill we can live with,” the Shelbyville Republican said in an interview.
Gov. Steve Beshear hailed the House vote and urged the Senate to pass the bill quickly. He said the measure “strikes a right balance between providing consumer protection and creating economic development opportunities that result from robust broadband accessibility in communities all across the commonwealth.”
Hood Harris, president of AT&T Kentucky, said House passage was a “positive first step to encourage increased investment in modern communications networks in Kentucky.” Harris promised a legislative committee that no one with an existing landline would lose it if a deregulation bill passes.
The bill’s opponents said the bill swings too far toward deregulation without guarantees that consumers will benefit. Rep. Hubert Collins, D-Wittensville, said there’s nothing in the bill to assure that AT&T will spend any more money than it already planned on broadband service in the state.
Collins and other opponents said the bill would take away needed oversight authority for state regulators.
“Do we just want corporations to call all the shots?” said Rep. Jim Wayne, D-Louisville.
The bill would strip state regulators of powers to force telephone companies to provide traditional landline service in areas with more than 15,000 households. Wayne said the bill would wrongly remove state oversight on such matters as quality of service and repairs in the largest urban and suburban areas.
Critics also have warned the bill would not protect people with existing landlines if they move.
And they say communication alternatives, like phone service via the Internet, are not reliable to maintain home security systems or home health monitoring services.
Rand, D-Bedford, countered that consumers are dropping their landline service in droves.
“AT&T is not driving that,” he said. “The market is driving them to different types of services.”
Rep. Tom McKee, D-Cynthiana, said he hopes the bill leads to telecommunication investments in places like the tiny community in his rural district where cell service is limited to one spot.
“It’s that kind of investment, as we move to the future, that will cover Kentucky,” he said.
The legislation is House Bill 152.