From: believer@telepath.com Subject: IP: 'Grass-Roots' Lobbyists Unrobed as AT&T Date: Sat, 24 Oct 1998 07:46:23 -0500 To: believer@telepath.com Source: Washington Post http://www.washingtonpost.com/wp-srv/digest/wtech002.htm 'Grass-Roots' Lobbyists Unrobed as AT&T By Jackie Spinner Washington Post Staff Writer Saturday, October 24, 1998; Page A1 The Prince George's Coalition Against Hidden Taxes billed itself as a "grass-roots" organization when it formed 10 days ago to fight proposed legislation that would charge telecommunications companies seeking to provide new telephone, Internet or other services. In those two weeks, the coalition, which has a paid spokesman and a professional public relations firm at its disposal, has spent $50,000 on radio, newspaper and television ads suggesting that the law would create a "hidden tax" on telephone use for all residential and business customers in Prince George's County. In fact, it is not clear what the legislation would mean for consumers. But this much is certain: There is very little that is "grass roots" about the Prince George's Coalition Against Hidden Taxes, which is a massive lobbying effort by AT&T to quash efforts by Prince George's County to cash in on the emergence of new communications technologies. The media campaign, which Prince George's County Executive Wayne K. Curry (D) called a "disgraceful fraud," demonstrates how much is at stake for a rapidly changing telecommunications industry and for a local government that stands to collect about $6 million a year by taxing providers of new services. Under the proposed legislation, the county would collect 3 percent of gross revenue generated by companies that seek to use public rights of way to lay cable, string wire or plant cellular towers to provide new services. Prince George's County Council members are scheduled to vote on the legislation Wednesday. Prince George's County is the first local jurisdiction in the Washington region to consider a broad telecommunications fee for using public rights of way. Governments across the country are struggling with similar efforts, trying to get fair compensation while encouraging companies to come in and provide services after the 1996 Telecommunications Act opened the doors to competition. AT&T officials said the legislation is unfair and singles out telecommunications firms from other users of public land, such as the Washington Suburban Sanitary Commission, Washington Gas Light Co. and Potomac Electric Power Co. "It's a money grab," said Ross Baker, director of governmental affairs for AT&T in Maryland. "We pay handsomely right now for the occupancy of the right of way." AT&T now pays permit fees and personal property taxes on equipment located on public rights of way in Prince George's. The company estimated those costs to be about $218,000 a year. According to AT&T, all phone customers' monthly bills could increase 3 percent to 15 percent if the legislation is passed because the cost would have to be passed on to consumers. The company said it would indicate on the bill what portion was the result of a "Prince George's County" surcharge. "Telephone bills are going to go up," said Steve Novak, spokesman for the AT&T-led coalition. County officials and the communications lawyer the county hired to draft the legislation dispute that contention. They said the legislation specifically exempts from the fee basic telephone services such as those provided by Bell Atlantic. But telecommunications companies, including Bell Atlantic, would pay a fee for running new Internet lines or providing telephone service over cable wires, something AT&T is exploring in some markets. Companies also would be charged for offering new call waiting and call forwarding features. "This legislation will not cause an increase in the prices of traditional telephone service," said Nicholas P. Miller, the D.C.-based communications lawyer advising the county. "On the other hand, because billing is largely deregulated, we have no control over how the companies may misrepresent the effect of this local rental charge." John Dillon, Bell Atlantic's vice president of external affairs, said the company is opposed to legislation that taxes revenue for any of its activities, traditional or otherwise. "If the county wants to sit down and talk about what costs are not being covered, we will do that," he said. Thomas Haller, president of the Prince George's Chamber of Commerce, which held what it called an emergency meeting yesterday to discuss the legislation, said the bill could deter telecommunications companies from doing business in the county. "If companies are dissuaded from providing telecommunications services here because they can't compete, we're not going to have much competition," Haller said. Novak said AT&T formed the coalition to warn the public about the county's proposal. People calling the coalition to express their concern about the legislation are quickly transferred to the office of their County Council member. "We are trying to educate the public," Novak said. Council member M.H. Jim Estepp (D-Upper Marlboro), who sponsored the legislation, said he received calls from residents at a rate of about 16 an hour during one day this week. Often, he said, callers were disconnected when he started to explain his position. (Novak said the disconnections are not intentional.) "These are big-time tactics, and when big money tries to crush local government, not only are they doing a disservice to the county, that becomes the issue," Estepp said. Curry agreed. "This isn't any citizens coalition. This is a bunch of giant companies trying to profit off the public for free," he said. But AT&T spokesman Stephen H. Clawson said consumers are the ones who will be hurt. "We found out that there was considerable confusion and concern about the legislation," he said. "We have an obligation to our customers." © Copyright 1998 The Washington Post Company ----------------------- NOTE: In accordance with Title 17 U.S.C. section 107, this material is distributed without profit or payment to those who have expressed a prior interest in receiving this information for non-profit research and educational purposes only. 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