VOLUME 12, NUMBER 16             April 26, 2007


To: Members

From: David Crothers, Executive Vice President

Yesterday marked the end of North Dakota’s 60th Legislative Assembly.  By any measure, members of the independent telephone industry in the State had a wonderful session.  Although it was a tremendous amount of work for members of the Association, directors and managers were able to make compelling arguments to legislators on a number of telecommunications matters.

Issues during the legislative session ranged from government-subsidized competition (House Bill 1003) to rate deregulation for larger independent telcos (House Bill 1142) to more fair interconnection agreements (House Bill 1143) to pretexting legislation (House Bill 1316 and Senate Bill 2255) to fair compensation for processing E-911 calls (Senate Bill 2169) to new obligations for carriers under the State’s telephone solicitation rules (Senate Bill 2195).  The Association also made the voice of North Dakota’s locally-owned telecommunications companies heard on wireless issues (House Bill 1196 and Senate Bill 2409) reduction in the size of the Public Service Commission (Senate Bill 2383 and Senate Concurrent Resolution 4014) and a number of agency appropriations bills.

In every single instance the positions adopted by the Association’s Legislative Committee prevailed.  It would literally be impossible for the independent telephone industry to have had a “better” session than the one just completed.

While members of the Association are gratified about the success of our industry they are mindful of the work that lies ahead.    While we are very pleased about the language prohibiting commercial use of the University System’s Northern Tier Network (House Bill 1461), we believe that the operators of the network will be back in two years asking for the removal of some of those restrictions.  

Also, the legislature adopted a resolution asking for a study to investigate the merits of criminalizing violations of North Dakota’s One Call statutes.  There are differing opinions within our own industry over whether it is a good idea to expand on the legal remedies currently available.   The Association will be participating in each of the meetings held by interim committees studying this matter.

Members of the Association also owe a tremendous amount of gratitude to many individuals for the successes of the independent telephone industry during the legislative session.  Foremost, among them are Senator Randy Christmann, Senator Tom Seymour and Representative Craig Headland for their tireless voices in the Senate and House of Representatives with the knowledge and ability to tell your story in a persuasive manner.  Their service to their communities and the State of North Dakota should be applauded.

Also making multiple trips to Bismarck to testify before legislative committees and meet with their legislators were Dave Dunning, the manager at Polar Communications; Dave Dircks, manager at North Dakota Telephone Company; Roger Del Fiacco, Finance and Accounting Manager at Nemont Telephone Cooperative; Jim Howard of John Staurulakis, Inc.; Don Negaard of Pringle Herigstad law firm; and Mick Grosz, manager of West River Telecommunications Cooperative.   Their assistance and willingness to share their knowledge with members of the legislature was instrumental in the Association’s successes.

We also benefited tremendously from the counsel, knowledge and experience of the Association’s Legislative Committee, who began their work on policy issues late last year.  Members of the committee include Derrick Bulawa, manager of BEK Communications; Paul Schuetzler, manager of Consolidated Telcom; Keith Larson, manager at Dakota Central Telecom; Jeff Wilson, manager at Dickey Rural Telephone Cooperative; Kent Klima, a director at Dickey Rural Telephone Cooperative; Mark Wilhelmi, manager of Midstate Telephone Company; Brenda Volesky, a director at Consolidated Telcom and president of the North Dakota Association of Telecommunications Cooperatives; Hilman Anderson, director at Reservation Telephone Cooperative; Jim Newman, a director at SRT; and Mick Grosz, manager at West River Telecommunications Cooperative.

This will be the final 2007 edition of the Association’s Legislative Report.  Past issues of the Legislative Report can be found within the archives portion of the Association’s website at www.ndatc.com.

 

HB 1003- The legislation is the appropriations bill for all of the institutions of higher learning in the State, as well as the board of higher education.  While the independent telephone industry does not advocate positions regarding the level of spending we are concerned about a provision within the bill to fund northern tier network, which is sometimes called “Internet2”.  Northern Tier Network is reported to be a “research” network for institutions of Higher learning in the State.  The Association believes that the scope of that network’s use should be limited to “research” and not available for the universities to resell to private users, make available to their student bodies or migrate other university telecom traffic to it.

Jan. 3 Introduced in House.
Feb. 15 Appropriations Committee Recommended "Do Pass", as Amended, 23-1.
Feb. 15 House Passed 65-26
Feb. 21 Introduced in Senate.
Mar. 27 Appropriations Committee Recommended "Do Pass" Amended, 13-1.
Apr. 2 Senate passed 45-1.
Apr. 11 House Refused to Concur.
Apr. 11 House and Senate Appoint Conference Committees.
Apr. 24 Senate Passed.
Apr. 25 House Passed.
   


 

HB 1021- The bill provides authority for the Information Technology Department to increase their ability to borrow money during the biennium. Specifically, it will allow ITD to borrow money from the Bank of North Dakota in the event that e-rate funding is not received from the Schools and Libraries Division of the Universal Service Administrative Company. The Department would have to receive prior approval from the Emergency Commission before borrowing the money.

Jan. 3 Introduced in House.
Feb. 13 Approprations Committee Hearing.
Feb. 15 House Passed 76-16.
Feb. 21 Introduced in Senate.
Mar. 23 Appropriations Committee Recommended "Do Pass" Amended, 13-0.
Apr. 3 Senate Passed 46-1.
Apr. 4 House Refused to Concur.
Apr. 5 House and Senate Appoint Conference Committees.
Apr. 23 House Passed 87-6.
Apr. 23 Senate Passed. 46-0.
   


HB 1142- The legislation increases the benchmark for rate deregulation for cooperative and independent telecommunications companies from 8,000 to 18,000 subscriber lines. Currently, all telephone cooperatives and those commercial companies with fewer than 8,000 lines have rate deregulation.

Jan. 4 Introduced in House.
Jan. 15 Industry, Business and Labor Committee Recommended "Do Pass" 13-1.
Jan. 19 House Passed 91-0.
Feb. 13 Introduced in Senate.
Feb. 26 Industry, Business and Labor Committee Rocommended "Do Pass" 7-0.
Mar. 1 Senate Passed 46-0.
Mar. 6 Signed by Governor.
   


HB 1143- This proposal would grant additional authority to the Public Service Commission and give the agency the ability to issue "Suspensions or Modifications" when considering rural exemptions. That expanded authority would be limited to Commission's consideration of independent telephone companies' requests for exemptions from interconnection. Although the Federal Telecommunications Act of 1996 envisions State Commissions having the ability to grant suspensions or modifications, the North Dakota legislature has never specifically authorized that jurisdiction for them.

Jan. 4 Introduced in House.
Jan. 15 Industry, Business and Labor Committee Recommended "Do Pass" 14-0.
Jan. 19 House Passed 88-3
Feb. 13 Introduced in Senate.
Feb. 26 Industry, Business and Labor Committee Recommended "Do Pass" 7-0.
Feb. 27 Senate Passed 46-0.
Mar. 7 Signed by Governor.
   


HB 1196- Legislation that will prohibit minors from using wireless devices or cellular phones while they are operating a motor vehicle. There are many variations of this legislation throughout the United States and include a mandate to use "hands-free" devices, complete prohibitions for adults as well as minors and complete bans for minors. Similar legislation has been proposed unsuccessfully in North Dakota in the past.

Jan. 5 Introduced in House.
Feb. 5 Transportation Committee Recommended "Do Not Pass", as Amended, 10-2.
Feb. 7 House Defeated 21-70.
   


HB 1226- A proposal to prevent certain nonprofit organizations from having ownership interests in for-profit organizations that competes with other for-profit companies. The legislation is specifically directed at those non-profits registered with the IRS under Section 501(c) (3), 501(c)(10), 509(a)(1), 509(a)(3), or a trust described in Section 4947 for which a deduction is allow-able under Section 170. The legislation mandates that an entity organized under one of these sections and that directly or indirectly receives Federal, State, or local tax revenues may not have an ownership interest in for-profit companies. Members of the NDATC Legislative Committee reviewed the bill thoroughly and expressed their concerns over any potential impact it may have on any of the entities that telephone cooperatives use to deliver services in North Dakota. Members of the Association were pleased during the bill's committee hearing when its sponsor, George Keiser (R-Bismarck) asked that it be converted into a study resolution.

Jan. 8 Introduced in House. Referred to Political Subdivisions Committee.
Jan. 12 Request Return from Committee.
Jan. 12 Rereferred to Industry, Business and Labor Committee.
Jan.30 Industry, Business and Labor Committee Recommended "Do Pass", as Amended, 12-1.
Feb. 5 House Passed 82-9.
Feb. 13 Introduced in Senate.
Mar. 1 Industry, Business and Labor Committee Recommended "Do Pass" 4-2.
Mar. 2 Senate Defeated 34-11.
   


HB 1316- Legislation introduced to add additional protection to a consumer's telephone records. The language will make it illegal for someone to attempt to procure another person's telephone records without the permission of the telco's customer. It will also make it illegal to sell or attempt to sell another's telephone records. The proposal seems to be an attempt to avoid the problems that arose during the Hewlett-Packard "pretexting" scandal in California in 2006. Of concern to the Association is language that will impose obligations on telecom companies to develop policies and constraints on the use of customer information. The Association was extremely pleased this week when the sponsor of the bill, Representative Lois Delmore (D-Grand Forks) appeared before the Committee and asked that the proposal be converted into a study resolution.

Jan. 8 Introduced in House.
Jan. 30 Industry, Business and Labor Committee Recommended "Do Pass", as Amended, 13-0.
Feb. 5 House Passed 81-9.
Feb. 13 Introduced in Senate.
Feb. 26 Industry, Business and Labor Committee Recommended "Do Not Pass" 4-2.
Mar. 1 Senate Defeated 39-7.
   


HCR 3026- A resolution that asks the Legislative Council and members of the legislature to study the appropriateness of implementing fines and other civil penalties for violating North Dakota's One-Call statutes. There has been discussion within the one-call community for many years regarding the inability of anyone to fine violators of the "call before you dig" rules without any resolution of the problem. In fact, members of the One-Call board of directors originally had a bill draft circulating that would have given themselves the ability to issue fines. A further provision made the State responsible for defending the board in courts of law. That idea was not very warmly received.

Jan. 25 Introduced in Senate. Referred to Industry, Business and Labor.
Feb. 8 Industry, Business and Labor Committee Recommended "Do Pass" 12-0.
Feb. 13 Second REading, Adopted.
Feb. 26 Introduced in Senate.
Mar. 12 Judiciary Committee Recommended "Do Pass" 6-0.
Mar. 15 Senate Adopted.
Mar. 20 Filed with Secretary of State.
   


SB 2008- The appropriations bill for the Public Service Commission. The legislation does not envision great changes from their appropriations bill of two years ago, although it provides for a new employee to handle GIS specialist. The bill again asks for approximately $900,000 to pursue a rail rate case on behalf of North Dakotans.

Jan. 3 Introduced in Senate.
Feb. 13 Appropriations Committee Recommended "Do Pass", as Amended, 14-0.
Feb. 15 Senate Passed 46-0.
Feb.21 Introduced in Senate.
Mar. 27 Appropriations Committee Recommended "Do Pass" Amended, 23-1.
Mar. 29 House Passed 66-22.
Mar. 30 Senate Refused to Concur.
Apr. 3 House Appointed Conference Committee.
Apr. 20 Senate Passed 44-0.
Apr. 23 House Passed 93-0.
   


SB 2169- Legislation advocated by the North Dakota Association of Counties that will begin to assess prepaid wireless phones and VoIP providers for a county's E-911 assessed fee. Additionally, the bill comprehensively revises the relationship between the counties and the Public Service Answering Points (PSAP's), while renaming an existing committee that oversees E-911 best practices. The Association has spent a substantial amount of time negotiating with the counties over the language that would be included within the bill. Earlier drafts included language that would have reduced the amount that telecom companies were able to retain for administration of the monies and a separate proposal to prohibit telcos from charging counties for their work changing the data base. The Association was very pleased that these items were not included in the bill's final version.

Jan. 8 Introduced in Senate.
Feb. 2 Political Subdivisions Committee Recommended "Do Pass, as Amended, 5-0.
Feb. 7 Senate Passed 47-0.
Feb. 13 Introduced in House.
Mar. 15 Political Subdivisions Committee Recommended "Do Pass", as Amended, 13-1.
Mar. 21 House Passed 78-15.
Mar. 28 Senate Concurred.
Apr. 9 Signed by Governor.
   


SB 2195- Legislation that expands the technologies covered under prohibited practices that telephone solicitors must abide by in North Dakota. The new language extends the prohibitions to those using satellite, VoIP, broadband "PSC" (there is currently a typo in the bill), microwave and other terrestrial phone service. The proposal does not currently add or subtract from the substantive language of the existing statute regulating telephone solicitors.

Jan. 15 Introduced in Senate.
Jan. 25 Industry, Business and Labor Committee Recommended "Do Pass", 7-0.
Jan. 26 Senate Passed 41-0.
Jan. 31 Introduced in Senate.
Mar. 8 Industry, Business and Labor Committee Recommended "Do Pass" 14-0.
Mar. 13 House Passed 91-0.
Mar. 28 Senate Concurred.
Apr. 4 Signed by Governor.
   


SB 2255- Another "pretexting" piece of legislation that will, if adopted, criminalize the unauthorized or fraudulent procurement of another's telephone records. It also bans the sale and receipt of those same records. The bill imposes far fewer obligations on telecommunications companies than previously introduced legislation addressing the same subject. The Association continues to have a number of concerns and have met with representatives of the Attorney General's office. The Association requested that no greater obligations be imposed on telcos than the already stringent standards imposed by the Federal Communications Commission and existing CPNI rules.

Jan. 15 Introduced in Senate.
Feb. 2 Judiciary Committee Recommended "Do Pass", as Amended, 6-0.
Feb. 7 Senate Passed 47-0.
Feb. 13 Introduced in House.
Mar. 6 Judiciary Committee Recommended "Do Pass", as Amended, 14-0.
Mar. 8 Referred to Judiciary Committee.
Mar. 13 Judiciary Recommended "Do Pass", as Amended, 12-0.
Mar. 15 House Passed 92-0.
Mar. 28 Senate Concurred.
Apr. 4 Signed by Governor.
   


SB 2383- A bill that is a mechanism to implement an accompanying Senate Concurrent Resolution that calls for an amendment to the North Dakota Constitution reducing the size of the Public Service Commission from 3 commissioners to one. The change becomes effective under the legislation on January 1, 2011.

Jan. 22 Introduced in Senate.
Feb. 2 Government and Veterans Affairs Committee Recommended "Do Not Pass" 4-2.
Feb. 6 Senate Defeated 14-32.
   


SB 2409- Legislation that codifies the obligations of wireless companies to disclose a multitude of items to their customers and make those facts available online. It also requires the Public Service Commission to develop rules regulating the form and substance of the contents of the contract between the wireless provider and subscriber. The bill also requires wireless companies to develop maps detailing where wireless coverage is available on a county-by-county basis.

Jan. 22 Introduced in Senate.
Feb. 13 Industry, Business and Labor Committee Recommended "Do Not Pass", as Amended, 4-2.
Feb. 15 Senate Defeated 33-13.
   


SCR 4014- A resolution that proposes to replace the three-member Public Service Commission with a single public service commissioner and to change the term of office from six to four years. The North Dakota Constitution would have to be amended by the voters in 2008 to make the change.

Jan. 22 Introduced in Senate.
Feb. 2 Government and Veterans Affairs Committee Recommended "Do Not Pass" 6-0.
Feb. 6 Second Reading. Failed to Adopt.