From the Office of State Senator Troy Fraser
For Immediate Release
February 17, 1999
Contact: William A. Scott - (512) 463-0124
SIBLEY, FRASER FILE BILL TO LOWER LONG DISTANCE RATES
The cost of an intrastate long distance call will drop and the local telephone market will become more competitive under a bill filed Wednesday by state Sens. David Sibley and Troy Fraser. Long distance access charges, which make up the bulk of the price of an intrastate long distance call, would be cut in half under Senate Bill 560.
"Reducing access rates will slash the cost of long distance calls made within our state," said Sibley, R-Waco. "The cost of a call from Hillsboro to El Paso should drop drastically. In addition, as both the long distance and local telephone markets become more competitive, telephone companies will offer consumers better deals in order to win business."
"I am firmly committed to reducing the local access charges that Texans pay for long distance calls, and I believe this bill is a good vehicle to start our discussion in the Senate," said Fraser, R Horseshoe Bay. "I look forward to finding the best way to aggressively move toward lower long distance rates in Texas and encouraging competitive local phone markets with better service for both residential and business customers."
Senate Bill 560 cuts Southwestern Bell's long distance access rates from 12 cents per minute to 6 cents per minute. Southwestern Bell charges long distance carriers these access rates in order to connect in-state long distance calls. Southwestern Bell controls almost 78 percent of the access lines in Texas.
The reduction in access rates must be passed on to consumers by long distance companies under SB 560.
"It's important that all consumers -- no matter how many long distance calls they make each month -- save money because of these reductions" Sibley said. "Our intent is not to benefit only the high-volume caller."
As a result of Universal Service funding, the Public Utility Commission will reduce access rates by about 3 cents this summer. Access rates will drop another 1 cent on Sept. 1, 1999. Another penny reduction will take place when Southwestern Bell enters the long distance market, and the final 1 cent reduction will occur one year later.
Under the Federal Telecommunications Act of 1996, Southwestern Bell is not permitted to offer long distance service until the Federal Communications Commission has stated that the state's local telephone service market is competitive.
Other provisions in SB 560:
- Extends the cap on phone rates charged by Southwestern Bell and GTE until Sept. 1, 2003. The cap was originally set by lawmakers in 1995.
- Once the local telephone market has been declared competitive, Southwestern Bell would be allowed to offer a combination of basic phone service with options such as speed dialing, Caller ID, mobile service or call waiting at a flexible price.