PRESS RELEASE
From the Office of State Senator Troy Fraser

For Immediate Release
May 24, 2005
Contact: Bill Bragg - (512) 463-0124

Landmark Telecommunications Legislation passes Texas Senate

AUSTIN - Legislation sponsored by state Senator Troy Fraser (R-Horseshoe Bay) updating a 10-year-old law that would stimulate competition and create jobs in new and innovative communications technologies passed the Texas Senate on Tuesday.

"This is another step in the orderly transition Texas has been making for several decades to move the communications industry from a monopoly to a fully competitive marketplace," Fraser said. "There has been an explosion of new technologies and state policy needs to recognize those changes."

"House Bill 789, as substituted, represents a lot of hard work and long hours," Senator Fraser said after the bill passed. "I think this is a good compromise that continues the process of deregulation and still protects Texas consumers."

H.B. 789 will completely deregulate urban markets, defined as markets with 100,000 individuals or more, on January 1, 2006. Suburban markets with a population between 30,000 and 100,000 will be opened if they meet the market test conditions outlined in the legislation and rural markets will be opened at the discretion of the PUC. If the PUC determines that an area with a population below 100,000 does not meets basic standards for competition it has the authority to re-regulate that market.

The substitute also provides that the PUC will conduct a study of the Universal Service Fund (USF). The study will include a review of the current disbursements as well as proposed changes in those disbursements. If the legislature does not act to implement changes to the USF by the end of the 80th Legislative Session, the PUC will automatically have the authority to enact the findings of the study on 9/1/07.

Fraser's legislation will continue to ensure the rates for consumers who need the most basic service will continue to be regulated by the PUC until an adequacy study of the basic rates can be done. Other consumer protections include a continuation of the Lifeline program, which provides deeply discounted telephone service for disadvantaged Texans.

"I want to modernize communications policy and create a regulatory framework that keeps pace with the changes in the 21st century marketplace, and I think this substitute does that," Senator Troy Fraser said.

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