Tired of Waiting for FCC, Minnesota Bill Would Take on Rural Call Completion

The bill is believed to be the first or among the first nationally that tries to handle the rural call completion issue. National organizations including NARUC and the NTCA say they know of no other similar bills. A Minnesota Department of Commerce spokeswoman said the department is unaware of any like bills that have been proposed nationally. If approved, Minnesota would join Oregon and Nebraska in deciding not to wait for the FCC to take action.

In a February 2013 NPRM (CD Feb 8/13 p8), the FCC proposed reporting and data retention requirements to help the commission figure out what the problem has been. The step followed a 2012 FCC declaratory ruling to “remind” carriers of their obligation to connect calls to rural areas (http://fcc.us/1cRsAYy). State utilities commissions in Oregon in 2012 and Nebraska last year passed rules holding phone providers accountable for dropped calls. It remains to be seen if other states will tire of waiting for the FCC and follow. Minnesota’s bill reflects frustration that could lead to states acting on their own, said Jill Canfield, NTCA director-legal & industry. The bill would “make sure the consumer is informed about what’s going on,” she said. “It’s a far more honest approach than a false ring back."

Christopher Mitchell, director of Telecommunications as Commons Initiative at the Institute for Local Self-Reliance, said the bill puts Minnesota at the “forefront” of states dealing with rural call completion. It could spur other states to do the same, “because the FCC had been so slow in moving on it,” he said. Public Utility Commission of Oregon (PUCO) Telecommunications Division Administrator Bryan Conway said more states may feel they cannot wait. “It doesn’t surprise me that Minnesota is taking this up,” he said. “As more customers find out about the issue, they'll increasingly go to state regulators. It’s not a satisfying answer to say, ‘We could take action, but you should go to the FCC.'"

Industry lobbyists have opposed new state regulations, saying in filings before the Oregon and Nebraska commissions that they should wait for FCC action. At a hearing on the proposed bill before the Minnesota Senate Jobs, Agriculture and Rural Development Committee May 5, Sprint lobbyist Joseph Bagnoli called the proposed measure “a bit premature,” given the FCC action.

Not Wanting to Wait

Minnesota Department of Commerce Commissioner Mike Rothman said in an interview the FCC’s actions haven’t resolved issues like fake rings. “What we're finding is the practice is continuing,” he said. Rothman told the committee there was an urgency to act, calling the problem a “public safety issue” and “an economic issue for small businesses losing thousands of calls and millions of dollars in business because calls are not being completed.” PUCO Chair Susan Ackerman said in a news release (http://bit.ly/1haeHaz) after the passage of Oregon’s rules that “we support a nationwide solution. However, waiting for a national solution can take years. That is not acceptable."

Others are focusing on urging the FCC to act. The Washington Utilities and Transportation Commission (WUTC) considered taking action and held workshops with providers in 2011 to gain input. WUTC Senior Policy Advisor Brian Thomas said the commission considers the issue a serious one but opted not to pursue it largely because the FCC was taking up the issue.

A PUCO staff report said long-distance or interexchange carriers (IXCs) use a third-party to route calls to local exchanges. Because termination fees in rural areas tend to be high, computerized routing software called “least cost routing” is used to find the cheapest route. The report said the software can block calls to rural areas to keep down costs. In the meantime, callers may be left listening to the phone ring. State actions have focused on holding the carriers initiating or terminating calls responsible. Oregon’s rule (http://bit.ly/1oJzBA0) prohibits the caller’s carrier, or its subcontractors, from blocking or restricting traffic to rural areas. It also bars carriers from deceptive practices such as telling the caller the number being called is out of service or unreachable (CD Dec 21/12 p9). The caller’s provider was held responsible for a simple reason, Conway said. “You pick up the phone and you expect your carrier to complete the call.” Nebraska, which passed rules in April (http://bit.ly/1cNLJjO), bars companies at either end of a call from blocking or restricting calls, and also holds them responsible for contractors’ actions.

Minnesota Telecom Alliance CEO Brent Christensen believes the focus is unfair. The alliance backs the bill’s aim, but holding the companies initiating and terminating calls responsible for dropped calls sets up “unrealistic responsibilities,” he said. Often, intermediate companies are the problem, he said. “If a call isn’t connected in ten seconds, we have no idea why they didn’t terminate.” The measure “takes a shot gun when a sniper rifle is needed,” he said. The bill is one of two competing measures before the Minnesota legislature. Alliance-backed SF-584 (http://bit.ly/1gcPiLt) would deregulate phone service except for households with only one residential landline (CD March 7 p11). The Minnesota bill would also require third-party companies to register with the state, and provide a number where they'd be reachable at all times to address failed calls.

It’s unclear what impact the Oregon rules have had, Conway said. “It’s not obvious to people [when there’s a problem]. People who are not receiving calls don’t know if they're not receiving calls.” (kmurakami@warren-news.com)