Georgia utility regulators Tuesday set standards for how rural independent telephone companies can tap into a state-mandated subsidy fund.
The decision implements a portion of HB 168, an intensely lobbied telecommunications bill originally designed to eliminate the state’s “universal access” subsidies for rural phone companies. The fund gets its money from large phone and cable companies and is intended to keep services affordable in rural areas that are costly to serve.
The 2010 law phases out the fund over the next 20 years. It also requires the 29 independent phone companies, which were deregulated in 1995, to agree to some regulation if they wanted to tap into the fund. At the time the bill was passed, eight of the independent phone companies continued to be regulated. An additional 12 went under regulation so they could receive the universal-access subsidy.
The PSC Tuesday voted to cap the amount each company could receive at $1 million. Companies that wanted more than that would have to have a traditional rate-of-return hearing by the PSC.
“It’s not free money. That’s not our charge. That’s not where we need to be,” Wise said. “I think it’s crucial that we consider (rates).”
None of the independent phone companies have had rate cases since 1995. They periodically submit financial data to the PSC, which is checked against federal regulatory benchmarks.
The motion stemmed from a proposal by the Cable Television Association of Georgia. It is similar to an agreement struck by AT&T and the Georgia Telephone Association.
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