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Who Wins When Consumers Pay More?

March 02, 2012 J

Earlier this week, I testified at a hearing in support of HB 2737. This much-needed legislation was created to address the growth of our state’s Universal Service Fund – a subsidy which phone users pay on their monthly phone bills. The Fund has experienced steady growth over the years to enhance the profits of small, rural phone companies – a trend which has forced consumers to pay more and more for their service over time.

I was pleased to learn that Rep. Peters took the lead on correcting this problem and was happy to lend my support for the bill at a hearing before the House Energy and Utility Regulation Committee. But, sadly, as they have done in the past, lobbyists for the rural phone companies were once again able to sway members into believing that this Fund is critical to providing phone service in rural areas of our state. This smoke-in-mirrors argument makes little sense given all the phone technologies that are available to consumers in the Sooner State, but their efforts were effective. The Committee chose not to move this bill forward at the expense of their constituents.

The bill was a perfectly reasonable solution to a looming tax problem but unfortunately, the Committee did not see it that way. As a taxpayer and advocate for sound economic policies, I’m deeply troubled by the Committee’s decision. After all, the bill wasn’t going to eliminate the Fund – which would have been a BIG win for consumers – it was going to cap it at today’s levels to prevent future tax increases. That seems like a common sense approach to me, but in the end, the Committee could not swallow it.

It’s unfortunate that our state has allowed this tax cycle to go on for as long as it has, especially given the change in consumer preferences in the telecommunications marketplace. Tuesday’s decision is clearly a win for the smaller phone companies and a loss for consumers across Oklahoma. Hopefully the Oklahoma Corporation Commission will share my perspective and correct this problem. If you are tired of paying more for your phone service, let the Oklahoma Corporation Commission know how you feel. The Commission is reviewing a proposal on this very issue and a decision on this matter is imminent. If you are fed up with high phone taxes, there is no better time than now to weigh in.

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