PUC OKs phone users’ bill of rights

PUC OKs phone users’ bill of rights


SAN FRANCISCO – A divided California Public Utilities Commission on
Thursday ended six years of wrangling by issuing a long-awaited
proclamation of the rights of telephone customers and promising to step
up consumer education and enforcement of existing rules.

Consumer advocates quickly criticized the PUC for failing to write into
its package detailed rules against billing abuses by wireless service

Instead, the PUC, after a lengthy and at times heated debate,
voted 3-2 for a plan that relies mainly on competitive pressures to
protect telecommunications consumers’ privacy, freedom and other

"There isn’t any need for new rules," said PUC member Rachelle
Chong. The commission’s approach should emphasize "routing out the bad
guys and enforcing our existing rules," she said later.

But PUC member Jeff Brown, who voted against the plan,
dismissed the new rights declaration as nothing more than "a deception
designed to hoodwink the public into thinking the PUC is actually
protecting them."

Brown, who was the author of a tougher rules package enacted in
May 2004 but suspended eight months later, characterized the consumer
protection document approved Thursday as "an inducement to massive,
pervasive and unaccountable fraud."

PUC member Dian Grueneich pushed for a compromise approach that
would have junked two-thirds of the previously adopted rules but
reinstated 30-day penalty-free cancellation rights for new contracts,
and required wireless companies to offer concise, plain-English
summaries of key terms and provisions. Under Grueneich’s plan,
companies that marketed in languages other than English would also have
been required to provide contracts in those languages, and it would
have barred companies from using wireless bills to collect payment for
non-telephone services.

PUC member John Bohn, who cast the deciding vote for the more
laissez-faire approach, acknowledged "the abusive possibilities of
unfettered competition" but said that new rules wouldn’t help. "Our
task is to artfully get out of the way and let the market work its
magic while protecting the consumer," he said.

Thursday’s vote culminated a 180-degree turn by the PUC, which
voted a year ago to suspend what had once been hailed as a
ground-breaking state-level effort to protect consumers. In addition to
some of the provisions of Grueneich’s plan, the suspended rules spelled
out how companies were allowed to market, bill, assess late fees and
terminate service.

But with two watered-down consumer protection plans on the
table Thursday, three commissioners backed a proposal designed to avoid
imposing new rules that might stifle innovation. Originally drafted
under the direction of Susan Kennedy, who earlier this year left the
PUC to become chief of staff to Gov. Arnold Schwarzenegger, the adopted
plan was also sponsored by PUC President Mike Peevey.

A dozen public speakers on the issue were evenly divided. Richard Holober, executive director of the Consumer Federation of California,
said the PUC should step in to make agreements understandable. "People
just don’t have the time and they don’t have the capacity to read
through all the fine print in these contracts," he said. "And it’s in
the fine print that these companies make their money."

But Jim Hawley, a lawyer for TechNet, an advocacy network, said
Peevey’s looser approach would help preserve "a critical growth
opportunity for California companies."

Complaints of abusive practices by fast-growing wireless
telephone companies prompted the PUC to begin drawing up new rules six
years ago. Wireless providers, whose growth got a boost from new
technologies and a 1996 federal law that aimed to scale back
regulation, consistently opposed California regulators’ efforts to draw
up rules.

Peevey said that the PUC hadn’t gathered enough evidence of
current problems to justify tougher measures, but acknowledged that
"many" members of the PUC staff disagreed with his approach.

PUC member Chong, who voted with the majority, acknowledged the
PUC still sees complaints, with a current backlog of 25,000 about
telephone service.

Brown said Thursday’s vote would worsen that situation: "Every
employee in this building knows that today’s order means no enforcement

But Peevey said the PUC would have adequate enforcement
resources, in part because Kennedy would use her new job with the
governor to include in the state budget money to hire 30 additional

The adopted consumer package includes a plan for a six-month
study of the special needs of non-English speaking telephone customers
and new consumer education efforts.

But Grueneich worried the lack of specific rules would prevent
what frequently was labeled a telephone users "bill of rights" from
delivering on its promises to consumers: "When we tell them about
choice, when we tell them about rights, we may come up empty-handed."

Sen. Debra Bowen, D-Redondo Beach, said in a news release after
the PUC vote that she would consider introducing legislation with new
rules to protect telephone consumers.

Rick Jurgens covers energy and business. Reach him at 925-943-8088 or at rjurgens@cctimes.com.


The Telecom Bill of Rights says consumers are entitled to:

‘ Freedom of choice

‘ Disclosure

‘ Privacy

‘ Public participation and enforcement

‘ Accurate bills and dispute resolution

‘ Non-discrimination

‘ Public safety

But drops rules that would have required:

‘ 30-day right to cancel new wireless contracts without incurring a penalty fee

‘ Plain-English summary of key contract terms

‘ Specific authorization for inclusion of non-telephone charges on monthly bills

‘ Provision of translated contracts by companies that market in languages other than English