FRANKFORT — A controversial proposal that would deregulate Kentucky's telephone industry and allow major phone companies to drop land-line service in some areas resurfaced Tuesday in the General Assembly.
Senate Bill 88, filed by Republican Sen. Paul Hornback of Shelbyville, faces an uphill battle in the Democratic-controlled House, where there is anxiety about the loss of land-line service in rural areas.
Hornback withdrew a similar bill during the 2012 legislative session because of concerns from community groups that it would allow AT&T and other major phone companies to yank basic phone service in unprofitable areas. Elderly and poor people depend on land-line service in many parts of Kentucky where wireless service is often spotty, community groups said.
State law requires phone companies to provide basic land-line service as the "carriers of last resort" for households throughout their territories. It also requires the Kentucky Public Service Commission to investigate and resolve consumer complaints.
Hornback said at a news conference Tuesday morning that his bill has new provisions that should alleviate some concerns of community groups.
The bill has a "carve-out" to protect rural areas with fewer than 5,000 land lines from being disconnected. Hornback said major phone carriers would not be able to remove basic service from those areas unless another provider offered a similar service.
"There has to be competition in that market," Hornback said.
In areas with more than 5,000 land lines, major phone carriers such as AT&T, Windstream and Cincinnati Bell would no longer have to provide basic phone services for new customers.
Tom FitzGerald, director of the Kentucky Resources Council, said changes to the bill "do nothing to alleviate my concerns."
He said the bill would allow carriers to stop serving areas where wireless services are available, which is not the same as a land line. Many parts of rural Kentucky have wireless service that is unreliable, he said.
"Even AT&T's own website says that it is not comparable to a land-line service," FitzGerald said.
House Speaker Greg Stumbo, D-Prestonsburg, said Tuesday he still has "a lot of reservations" about the bill. He said AT&T has "come a long way in trying to move something, but I want to protect the people of rural Kentucky."
Proponents of the bill said Kentucky needs to invest more money in broadband Internet services, which can be a key component of economic development in rural Kentucky. Traditional phone companies can't invest in high-speed Internet if they have to maintain land lines in unprofitable areas, Hornback and others said.
Hornback said the chief complaint of his rural constituents is lack of access to high-speed Internet. States that have adopted similar legislation have seen more private investment in high-speed Internet infrastructure, he said.