Settlement rejected

PSC orders its staff, Verizon and consumer advocates back to negotiating table over repair woes, fee changes

April 08, 2009|By Liz F. Kay | Liz F. Kay,

The Maryland Public Service Commission sent its staff, consumer advocates and Verizon back to the negotiating table on a settlement agreement about repair problems as well as changing some fees and deregulating some bundled telephone services.

The commission directed the company, the Office of the People's Counsel, which represents consumers, and commission staff to report back May 5 on key areas that the regulators say do not protect the public interest.

Commissioners stated in their order, released Monday night, that Verizon needed to pay higher penalties to residential customers if it continued to fail to repair its telephone service in a timely fashion.

The settlement would allow for price increases regardless of the quality of service, according to the order, and thus does not resolve issues about service raised by the original complaints. Verizon would also pay a $10.88 penalty to residential customers who complained that they had been left without service for days and $2.77 to those who had scheduled appointments that technicians missed. The company also promised to pay $1 million each quarter in additional penalties to affected customers if the company continued to fail to meet performance targets.

Commissioners stated in the order that they liked the concept of fines but feared they were too low to motivate Verizon to comply with state regulations to properly maintain service. Instead, the fines might be treated as a cost of doing business. They also noted that commercial customers have not suffered the same delays that residential customers faced.

"We know that the forces of the marketplace have not compelled Verizon to comply with our regulations so far," the order states, because the company's service performance has not improved since the regulators' investigation began in 2007.

Verizon said it was reviewing the order. "We think that the settlement that was negotiated ... had some real consumer benefits in it," said William R. Roberts, Verizon's regional president in Maryland and Washington.

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