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Phone Companies' Plan Likely to Raise Rates, Group Says"
COLUMBUS, Ohio -- A plan that Alltel and Western Reserve telephone companies are seeking to have approved by state regulators could increase the rates of dozens of services and features at a time when their residential customers have no choice of local telephone providers, the Office of the Ohio Consumers' Counsel said today.The OCC will oppose the plan in comments to be filed later today at the Public Utilities Commission of Ohio and will ask the PUCO to protect consumers' rates."If the plan is allowed by the PUCO, residential customers of both Alltel and Western Reserve could see significant price increases on commonly used services while still having no choice of local telephone providers," said Janine Migden-Ostrander, Consumers' Counsel. "At a time when many residents are trying to stay within a budget, they may be left to pay higher rates or forced to drop features altogether. This is unfair."The plan would allow Alltel and Western Reserve telephone companies to operate under "elective alternative regulation," which caps the price of basic local service while giving the company the ability to raise the rates of features like Call Waiting and Caller ID with Name. These companies could, for example, raise the prices of Three-Way Calling and Call Forwarding immediately and without limit, Migden-Ostrander said.After two years under the plan, Alltel and Western Reserve could raise the price of Call Waiting by 10% per year until its price reaches double what customers pay today, she added.Another local telephone company -- Sprint -- has used alternative regulation to impose increases of as much as 60% on several services and features since October 2002 when it began operating under the same plan, Migden-Ostrander pointed out.Alltel and Western Reserve filed their requests for elective alternative regulation with the PUCO on August 30. Unless the PUCO acts by Oct. 15, the plan will be approved automatically, she said.Elective alternative regulation allows local telephone companies to raise rates for commonly used features without any review while agreeing to cap the rates of basic local service and basic Caller ID. The OCC believes only companies whose customers have local telephone choices should be eligible for elective alternative regulation. "Approval of this plan would leave consumers without the protection of price increase reviews or the promise of lower rates that a competitive market may be able to provide," said Migden-Ostrander.The Office of the Ohio Consumers' Counsel, a state agency, is a residential utility advocate representing the interests of 4.5 million consumers in proceedings before state and federal regulators and in the courts.Visit the Office of the Ohio Consumers' Counsel: www.pickocc.org"