Newspaper article THE JOURNAL RECORD

Phone Company Officials Debate Proposed Access Charge Method

Newspaper article THE JOURNAL RECORD

Phone Company Officials Debate Proposed Access Charge Method

Article excerpt

The economic efficiency of a proposed method of determining access charges for long distance companies was debated in testimony during a second day of hearings Tuesday at the Oklahoma Corporation Commission.

The proposal would reduce the access charge, a fee paid by long distance telephone companies to local telephone companies for the completion of long distance calls. The proposal also seeks to allow the local telephone companies to recover the lost revenue by increasing their rates to the people making the calls.

The main proposal, developed by AT&T and agreed to by 39 of the 46 local telephone companies in the state, would have customers pay a greater percentage of the cost of local service, while reducing the access charges for long distance. The proposal has a cost transition from 1987 to 1991, which increases each customers' monthly bill by $.25 per line per year. By 1991, customers would pay $1.25 more per line per year under the proposal than they were in 1986.

Access charges may be measured by two methods: switched access and a flat rate charge.

Switched access is the current method of calculating the access charge. It is a fee based on the number of minutes a long distance call lasts and is paid by the long distance companies to the local telephone companies. Long distance call rates include this cost when billing consumers.

Using the flat rate, a commission-assigned arbitrator would total the number of switched access minutes used in the state and divide the total among all the long distance companies according to their Oklahoma market share. The companies servicing the state would then pay that amount to the local telephone companies.

Gary Mann, district staff manager of rates and tariffs for Southwestern Bell Telephone Co., said the flat rate recovery is better than switched access recovery. …

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