Policy

Texas Legislature OKs Telco Bill

8/10/2005 5:21 AM Eastern

Setting a national precedent, the Texas Legislature has approved an omnibus telecommunications-deregulation bill that would allow telephone companies to apply for a statewide franchise to deliver cable-television services.

The Senate approved the bill in its special session Tuesday with 68 yes votes. The House also approved the bill Wednesday on a voice vote. It’s unknown whether Gov. Rick Perry will sign the measure — or any other bills that pass the legislature — into law unless lawmakers conclude their business on education-funding reform.

The cable industry has consistently opposed the Texas bill, arguing that its terms give an unnecessary advantage to telephone companies. Supporter Verizon Communications Inc. has been able to obtain four city franchises in Texas through conventional means, cable operators have noted.

Verizon-backed bills are expected before the California and New Jersey legislatures before the end of this year. The New Jersey version of the legislation has not been publicized; Verizon declined to have the bill introduced when lobbyists determined the legislators were not interested in addressing the weighty topic before the November elections.

The bill is expected to surface after Election Day.

The California bill is designed to change level-playing field wording in state statutes, which currently compel Verizon to match the incumbents’ cable service areas. Verizon has one California franchise, in Beaumont, but it conforms with state rules because the telco serves the whole city.

A bill in Virginia died early this year in committee, as legislators did not want to take up the broad issue of telecom reform in a short legislative session.

Cable lobbyists were dismayed by the rushed approvals in Texas. According to news reports, the Senate took only 10 minutes on the bill on the floor. During the House debate, cable lobbyists said, the chamber leadership refused to recognize Dallas Rep. Yvonne Davis, who attempted to amend the bill with a cable-drafted amendment to prevent competitors from redlining. Davis tried to address the same issue during the regular session on a similar bill, with similar results.

Other opponents — including the American Association for Retired Persons, the Consumers Union, Common Cause, Save Muni Wireless, Technology for All and the Texas ISP Association — made a plea to the governor and legislators to resist passing “one-day lobby bills passed by tired, divided legislators.”

These opponents are angry that not all school-funding reform measures and are concerned the telecom bill will raise prices and undermine fair competition and consumer choice.

September