clark@beaver.cs.washington.edu> (12/04/89)
REPRINTED WITHOUT PERMISSION FROM THE SEATTLE TIMES
THURSDAY, NOVEMBER 30, 1989
FCC Orders Refunds to Long-Distance Companies
Associated Press
WASHINGTON - Local telephone companies may have to refund as
much as $75 million to long-distance companies and large private-line
business customers, the Federal Communications Commission says.
Pacific Northwest Bell in Idaho is one of the 15 companies named. The
local phone companies accumulated overcharges between 1985 and 1988
under FCC guidelines that allowed prices of these high capacity
private-line services to exceed the phone companies' costs of
providing the services.
The FCC ordered a refund Tuesday as it considered challenges
to the special pricing scheme, which the local phone companies provide
for long-distance companies or large business customers. The
commission voted 4-0 that the scheme was legal during the 1985-88
period, when the high prices were designed to keep too many customers
from switching from the regular public network to private lines, but
that market conditions no longer justify continuation of the special
pricing. The commission said it expects the local phone companies to
refrain from requesting such special prices in the future.
While examining the challenges to the special pricing scheme,
the commission said it found that local phone companies in some cases
had charged more than allowed under the commission's guidelines.
Therefore, the companies must refund those charges, which could amount
to as much as $75 million, the commission said. The FCC said the
amount of the refunds will not be known until the local phone
companies file detailed reports with the commission. The companies
have 40 days to make their filings.
The companies found not to be in compliance with the
commission's pricing guidelines from Oct. 1, 1985 to Dec. 31, 1986,
were: Diamond State; South Central Bell in Alabama; Southwestern Bell
in Missouri and Oklahoma; Northwestern Bell in Iowa, Minnesota,
Nebraska and North Dakota; Pacific Northwest Bell in Idaho.
Pacific Northwest Bell is now called US West Communications
and is the phone company that serves most Seattle-area residents.
Companies found not complying from Jan. 1,1987 to Dec. 31, 1988,
were:
Ohio Bell; Wisconsin Bell; Suothern Bell in North Carolina and South
Carolina; South Central Bell in Mississippi and Tennessee; Pacific
Bell; Nevada Bell; Southwestern Bell; Mountain Bell; Northwestern Bell;
and Cincinnati Bell.