Gov. Malloy, AG Jepsen, Consumer Counsel Katz
Welcome PURA Final Approval of Frontier, AT&T Purchase
Connecticut consumers will benefit from more than $63 million in improvements and investments in broadband Internet capabilities in the state under the agreement approved today granting final approval of Frontier Communications Corporation's purchase of AT&T's Connecticut wireline operations, Governor Dannel P. Malloy, Attorney General George Jepsen and Consumer Counsel Elin Swanson Katz said today.
At a meeting this morning, the state Public Utilities Regulatory Authority (PURA) gave final approval to the transaction, which included a number of terms and agreements aimed at protecting Connecticut consumers.
"With significant plans for broadband expansion and new provisions regarding the state's utility poles that will advance response to outages from severe weather events, today's approval of Frontier Communications both protects customers and provides increased commitments to our state," Governor Malloy said. "This company has a significant responsibility to residents in Connecticut, and I would like to specifically thank them, as well as Attorney General Jepsen, Consumer Counsel Katz, and PURA for understanding the need to protect consumers by providing reliable, consistent service and growing jobs in our state. Under the leadership of Chairman House, PURA Commissioners and staff dedicated countless months to ensure this merger agreement best served the consumers now and in the future, and for that they should be applauded for conducting this important evaluation with precision and efficiency."
"The consumer protections we negotiated with Frontier – including commitments on service, pricing and reliability – will help to provide continuity of service for current and new customers," Attorney General Jepsen said. " Additionally, $63 million in improvements to broadband service and capability over three years will have a significant impact not only on the quality of service for current customers but also on expanding broadband service to those currently underserved or unserved by AT&T. I believe that these commitments are in the public interest, and I'm pleased that PURA has given this its final approval."
"We worked hard with Frontier and the Attorney General's Office to hammer out a deal that ensures that Frontier's purchase of AT&T's wireline operations will be in the interests of customers," said Consumer Counsel Katz. "In crafting the agreement, we made sure to focus on both the present, recognizing that many customers continue to rely on their landline service, and the future, with commitments for development of broadband infrastructure. The rate freezes and the accelerated pole inspection requirements will provide for a smooth transition as well as reassurance to customers who may have been concerned about the impact of this transaction. Meanwhile, the broadband infrastructure commitments fit in well with my office's effort to promote universal broadband access for Connecticut residents and businesses, at speeds that will rival the best in the world. We appreciate PURA’s diligence in reviewing this proposed transaction and approving the agreement we reached as part of its final decision."
PURA's approval of the transaction incorporates settlement terms negotiated by the Attorney General and Consumer Counsel, including the following:
• Frontier will not increase the basic landline residential rate for at least three years. Additionally, Frontier will offer its basic broadband bundle and stand-alone basic broadband product at or below current prices for at least three years – a product and price-point designed to facilitate quality internet access for modest-income families in Connecticut.
• Frontier will invest a total of $63 million in capital improvements over three years (2015, 2016 and 2017) to improve and expand broadband capabilities in Connecticut. This investment will be used both to increase the speed of its broadband service and to expand its broadband availability to areas that are currently not served. The company has agreed to dedicate at least $3 million to projects focused on expanding to areas that are currently unserved or underserved.
• Frontier will not pass through to or recover transactional costs from Connecticut customers. Connecticut customers will not fund any portion of the purchase price, goodwill or any costs associated with the transaction, including financial, legal, severance payments, regulatory fees or investment services.
• Frontier will institute a Connecticut-based pilot program, in collaboration with the Department of Veterans Affairs, to improve the adoption and utilization of the VA's My HealtheVet and Home Telehealth programs. Frontier will support the pilot program with a combination of subsidized broadband service and a $50,000 donation per year to be used for VA-selected computer tablets and other telehealth-capable devices. The program will launch in 2015 and Frontier will participate for a least three years.
• Frontier will provide Connecticut's low-income veteran population reduced price broadband service. Eligible veterans will qualify for $19.99 per month basic broadband service (reduced from $34.99), without a contract or an auto-pay requirement, and will receive a free modem and free first-month service. The company will work in the coming months with the Attorney General and Consumer Counsel to develop the criteria and mechanism for determining eligibility.
Additionally, Frontier has committed to provide PURA with certain reports on its modernization and reorganization efforts as well as its compliance with the terms of the transaction. Frontier will also file a disaster preparedness and response plan and has committed, in the event of widespread outages – such as during a major weather or out-of-service events – to improve the timeliness and accuracy of its outage reporting to PURA.
Assistant Attorneys General Michael Wertheimer and John Wright assisted the Attorney General with this matter. Attorney William Vallee, the State’s Broadband Policy Coordinator, and Attorney Joseph Rosenthal assisted the Consumer Counsel with this matter.
Office of the Governor:
Office of the Attorney General:
Jaclyn M. Falkowski
Office of the Consumer Counsel:
Facebook: Attorney General George Jepsen