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Controversial Michigan Landline Phone Legislation Advances

Bill would make it easier for telecommunications providers to stop offering basic phone service.

An effort to make it easier for telecommunications companies to stop offering landline phone service appears to be succeeding in Michigan.

Legislation that would amend the Michigan Telecommunications Act to streamline the process companies have to go through to discontinue basic local exchange or toll service passed through the Michigan Senate and is now being evaluated by the state’s House of Representatives. If signed into law, the bill’s provisions would go into effect after Jan. 1, 2017.

Sponsored by Sen. Mike Nofs, R-Battle Creek, Senate Bill 636 has been categorized by some as a death knell for traditional hardwired phone service. But Nofs and some providers feel the bill protects landlines for those that need them, at the same time giving companies the flexibility to transition to a more cellular-based platform of services, or Voice over Internet Protocol (VoIP) systems.

In an interview with the Detroit Free Press, Nofs described the problem as a matter of companies supporting multiple systems and whether it is right to require them to keep investing in “antiquated technology.” In addition, the Free Press reported that FCC data indicates the number of landline customers in Michigan dropped from 6.7 million in 2000 to 2.6 million in 2012.

“The Internet has changed the way the world works, and it has already changed how millions of people talk on the phone,” Nofs said in a statement. “This bill ensures our constituents are protected while delivering new and improved technology. It’s the best of both worlds.”

Not everyone is buying that rationale, however. The Michigan Sheriffs’ Association issued a statement urging members of the Michigan House of Representatives to vote “no” on SB 636 or delay its passage until further amendments could be made to ensure public safety. Robert Stevenson, executive director of the Michigan Association of Chiefs of Police felt the bill would remove the availability of a reliable and affordable means for people to contact law enforcement.

AARP of Michigan also opposes SB 636, citing concern for older adults who likely rely more on landlines for social contact along with health and safety. The organization also noted that residents with home security systems or medical monitoring needs that run through landlines might be in jeopardy.

“AARP is fighting to ensure that its members and all Michigan families have reliable, affordable phone service they can count on, especially during extreme weather or other emergencies,” said Eric Schneidewind, former chairman of the Michigan Public Service Commission and a member of the AARP National Board, in a statement. “This legislation puts reliable phone service at risk for all Michigan consumers.”

If SB 636 becomes law, Michigan will join a large number of states that have passed legislation that eliminates or reduces state commission authority over telecommunications. According to a story by Governing magazine that cites a National Regulatory Research Institute (NRRI) report on the topic, if Indiana, Nevada, Tennessee and Wyoming all pass similar bills by the end of their respective 2013 legislative sessions, approximately 70 percent of the U.S. will have enacted laws that curb commission power over retail communication services. 

Governing and Government Technology are both owned by e.Republic, Inc.

What it Changes

According to the Michigan Telecommunications Act, currently a telecom provider that offers local or long distance landline service can’t cut the service unless one alternate toll service provider or two basic exchange providers are available in the area for customers to obtain comparable voice service. In addition, there is a litany of public notice requirements to be satisfied and the Michigan Public Service Commission (MPSC) must make a determination whether discontinuing landline service is authorized under the Act.

According to a summary of SB 636 by the House Fiscal Agency, a nonpartisan branch of Michigan’s House of Representatives, starting on Jan. 1, 2017, a provider could discontinue basic phone service by meeting these conditions:

  • At the same time it files a petition for discontinuance with the federal government, the provider must also:
    • File a notice of the proposed discontinuance of service with the Michigan Public Service Commission (MPSC).
    • Publish a notice of the proposed discontinuance in a newspaper of general circulation, provide notice to its customers, and provide notice to any interconnecting telecommunications providers.
  • Upon approval of the FCC to discontinue the service, the provider must do all of the following for at least 90 days before ending landline phone connectivity:
    • File a notice of discontinuance of service with the MPSC.
    • Publish a notice of the discontinuance of service in the newspaper, provide notice to customers by mail or within a bill and provide notice to any interconnecting telecom provider.
SB 636 also strips the MPSC of making a determination on its own. Under the bill, a customer of the provider that is seeking to discontinue service can request that the MPSC investigate the availability of comparable voice service with reliable access to 9-1-1 and emergency services. In addition, unlike current law, only one comparable voice service provider need be present in the area. The House Fiscal Agency noted that “comparable voice service” is defined by SB 636 to include any two-way voice service through any form of technology, including VoIP and wireless services.

Looking Ahead

In an interview with Government Technology, Greg Moore, Nof’s legislative director, categorized the bill as something that makes the process that companies have to go through to disconnect service “a little bit quicker.”  He explained that discussions in the House of Representatives are now focused on tweaking the bill’s language so that 9-1-1 services are fully accessible and other technologies such as fax machines can still operate without difficulty.

Moore added that Michigan Gov. Rick Snyder and Attorney General Bill Schuette also have concerns about how access can be protected for local carriers that use copper networks to deliver landline services.

“That’s been kind of the sticking point – should we or shouldn’t we continue to protect that, and if so, for how long and under what mechanism,” Moore said. “Obviously some of the Frontiers and AT&Ts would rather see the federal government take over that responsibility exclusively, and right now the MPSC has a role that people are thinking they might want to keep around. So it’s been a debate on how the new frontier is going to look for telecommunications.”

Brian Heaton was a writer for Government Technology and Emergency Management magazines from 2011 to mid-2015.