Colorado regulators adopt framework for deregulating phone service – Denver Post

Colorado regulators Tuesday took the initial step of deregulating telephone service in the state and eliminating a program that reimburses carriers for providing service in rural areas deemed to be overly expensive to service.

The Colorado Public Utilities Commission adopted rules that will serve as the framework for determining which areas in the state have sufficient competition and no longer need to be rate regulated.

“This rulemaking is an initial step in a general overhaul of the telecommunication rules,” said PUC spokesman Terry Bote.

The PUC started looking at telecom reform in 2010. The Colorado Office of Consumer Counsel pushed for a review of the so-called High Cost Support Mechanism, which reimburses more than $50 million annually to CenturyLink, in August 2011.

A written order on the rules adopted Tuesday is expected by year end. Adjudicatory hearings will be held next year to identify competitive service areas, defined as having three or more phone service providers. Those areas would no longer be rate regulated and high cost support would be eliminated.

Pete Kirchhof, executive vice president of the Colorado Telecommunications Association, said Tuesday that “the PUC’s decision to create an effective competition test that can be used to determine funding for rural high-cost areas — especially one that presumes wireless service is substitute for basic telephone service — could have a negative impact on quality of service and price for rural customers.”

State lawmakers proposed to phase out the high-cost fund as part of a telecom reform bill this year, but the measure was shelved in May.

Andy Vuong : 303-954-1209, avuong@denverpost.com or fb.com/byandyvuong