REGULATION FOR REGULATION'S SAKE IS BAD BUSINESS FOR ALL

To the Editor:

The column in Sunday's newspaper brought up several pertinent issues regarding the Yellow Pages bill now in the Missouri legislature. I appreciate the opportunity to respond to these issues with my customers.

It is a mistake to think the Public Service Commission's view is unbiased.

For example, the commission says the $~45 million in customer~~~~ credits would have been virtually eliminated had the Yellow Pages bill been in effect. That is nothing short of skewing the truth to fit the times.

The Yellow Pages bill has absolutely nothing to do with the agreement created more than three years ago and supported by the Office of the Public Counsel and the Public Service Commission. If the Yellow Pages bill had been in effect at that time, we would have used other measurements to ensure that customers would have the opportunity to share in their telephone company's revenues.

In fact, as a show of good faith, Southwestern Bell has offered to adjust the points at which credits are given to reflect the removal of Yellow Pages revenues~~~~~. This offer is consistent with the bill's objectives~~~ to reduce ~the~~ regulatory bureaucratic burden caused by the Yellow Pages issue.

Opponents of the bill have argued that the legislature should not be the venue in which this issue is decided. Why? The legislature enacted the law that gave the commission the right to impute Yellow Pages. Therefore, it is appropriate that legislators review the practice and abolish it.

Some people insinuate that the issue is being decided behind closed doors in the legislature as opposed to the open forum that would exist at the PSC. That's wrong. Full and open debates were held before House and Senate committees in which both sides presented their case. More debate will follow when the bill reaches the floor of the two houses.

Also, we did take our case to the PSC prior to presenting the issue to the Missouri Legislature, and believed the evidence was in our favor. Why should our customers' phone bills be determined partly on the success or failure of a completely separate, unregulated advertising company like Yellow Pages?

The commission refused our request.

It is alarmist logic to wonder what will happen to rates "five or 10 years down the road." That's like wondering what will happen to interest rates five or 10 years from now. Ten years ago when rates were at 14 percent no one in their right mind would have predicted that you could get a home loan today for 5 to 7 percent, or lower.

However, there were people who used the same case more than three years ago when we entered into the current experimental regulatory agreement. They said Missouri customers would pay higher local rates in five or 10 years. Now, almost four years later, we've proposed to freeze rates for at least another three years.

Southwestern Bell's Missouri customers have not had an increase in basic local rates since 1984. With a minimum of three additional years of frozen local rates, SWBT customers will have had 12 years without an increase. How much has the cost of other products and services gone up in that time?

Phone companies are following a proper line of appeal regarding a rule that is regulation for regulation's sake.

The focus of telephone regulation is moving away from the atmosphere of the 1910's, when it was created, to a more modern view. With this shift, the telephone network is growing in importance and in its real world applications to the quality of life, to economic growth, and to education, health care and a host of other issues. These are changes that are mutually beneficial to customers and the phone companies.

Without eliminating burdensome regulatory rules such as Yellow Pages imputation, this evolution cannot continue to move forward at the same pace.

Issues, similar to this one, are being played out in various places across the country, including state commissions and legislatures, and federal courts, the FCC and Congress.

Southwestern Bell Telephone Company is taking a pro-active approach to regulatory reform. Regulation for regulation's sake is bad business for everyone. Our customers, our investors, our employees and all the communities we serve expect SWBT to be progressive and to create win-win situations. The Yellow Pages bill is extremely focused legislation~ and coupled with our proposal to freeze rates for another three years and~~ connect every junior and senior high school, university and college, and hospital with fiber optic cable, creates a winning situation for everyone.

Craig Felzien

Area Manager

Community Relations

Southwestern Bell

Cape Girardeau