AGENDA #10
TO: Mayor and Town Council
SUBJECT: Status Report on Telephone Service Issues
DATE: October 23, 2000
The purpose of this report is summarize recent actions taken by local telephone companies to resolve immediate customer service complaints and to propose actions that the Council could take to address long-term service issues.
Resolution A would ask BellSouth and Verizon to study the option of redrawing telephone service boundary lines in Chapel Hill to avoid dividing neighborhoods, and to provide follow-up information to the Council within 90 days.
Resolution B would request that the N.C. Utilities Commission begin procedures to establish an Extended Area Service (EAS) plan for Chapel Hill and Durham.
BACKGROUND
On July 5, the Manager presented a report to the Council, summarizing problems expressed by citizens who reside primarily along the eastern border of Town in both Orange and Durham counties. Concerns raised included:
1. Varying costs to call nearby telephone numbers, including neighbors who live across the street but who are served by another company.
2. Inconsistent telephone number listings in local directories, including directory assistance.
3. Connection problems and other service issues.
The Council held a public forum on September 18 so that citizens and telephone company representatives could comment on these issues. On September 18, residents of Silver Creek, Chandler’s Green, and Oaks Villas presented their concerns to the Council. Residents expressed frustration that, as Verizon (GTE) customers, they had to choose between calling Chapel Hill or Durham as a local call. They also pointed out various connection problems, including times when they were unable to hear a dial tone or when they were unable to receive the same high-speed Internet access that nearby BellSouth customers received. Some citizens said that they wanted to be able to change telephone service providers, but that they could not because of the provider in their area.
Representatives from Verizon agreed to address the customer service issues that were presented on September 18. Representatives of both Verizon and BellSouth agreed to meet with their supervisors to discuss the feasibility of changing the existing telephone service boundary lines.
At the conclusion of the September 18 forum, the Council approved a motion to: (1) refer the public comments to the Manager and Attorney for a follow-up report with recommendations; (2) ask that Council Member Evans take the issue of regional telephone service to the Triangle J Council of Governments; (3) refer background information and proceedings to the legislative delegations of both Orange and Durham Counties; and, (4) ask staff to follow up on service complaints that have come to the Council’s attention.
· “Outdated” equipment
· Lines that do not always work properly
The Council did not ask BellSouth representatives to respond to particular service issues on September 18, but BellSouth has agreed to work with Verizon and the Town Council.
Next Steps: Ongoing discussions between the telephone companies and their customers. The Town staff will provide the companies with the names and telephone numbers of Town citizens who notify us of further service problems.
As of this date, BellSouth has not chosen to provide service in the Chandler’s Green, Silver Creek, and Oaks Villas neighborhoods that have petitioned the Council in the past. Mrs. Hawkins said that BellSouth’s decision to provide service there would be based on economic studies. BellSouth could apply with the N.C. Utilities Commission to provide service there, but has not yet done so because cost studies are not complete. Mrs. Hawkins said that BellSouth was studying the area more closely to determine these costs.
Competition is allowed, but not mandated. The Telecommunications Act of 1996 allows more than one company to provide local service in an area. The “incumbent provider” – who has always provided service in an area – is required to continue, but a new company could choose to enter the picture and work out arrangements to provide service. It is an economic decision for the new company, which may choose not to compete locally because of the costs involved. Such companies are more likely to target business customers before residential ones, except for large developments such as Meadowmont, where BTI will provide local telephone service. A Meadowmont resident may still choose BellSouth telephone service as the incumbent provider, or opt for BTI.
On September 18, some residents stated that they would prefer to choose their local telephone service provider. This is not always an option. Such a venture would require the agreement of the two companies through the establishment of a “boundary transfer.” Telephone service providers can agree to redraw service lines, although Hugh Gerringer, Telephone Engineer with the N.C. Utilities Commission, says that the Commission cannot require them to do so. In State of North Carolina ex rel. Utilities Commission v. Southern Bell Telephone and Central Telephone Company (1974), the N.C. Court of Appeals ruled that the Utilities Commission does not have the authority to compel a telephone company to provide local exchange service to an area already receiving such service from another public utility.
Next Steps: We recommend adoption of Resolution A, which would request that BellSouth and Verizon study the option of redrawing the telephone service boundary lines in Chapel Hill to avoid dividing neighborhoods, and provide the Council with follow-up information within 90 days. Mrs. Hawkins of BellSouth anticipates a decision on the Boundary Line question within 90 days.
Neither telephone company has expressed support for Extended Area Service.
Verizon officials say that the current calling plans are equitable and grew out of years of effort. Mr. Crawford said that the challenge was to be equitable and still provide opportunities for a wider calling area.
Under the current structure, Verizon customers who are: (1) located within the Chapel Hill Town limits or (2) have a Chapel Hill mailing address have two options:
1. The TriWide Calling Plan, which allows unlimited calls to Durham numbers without a 408 prefix and to areas such as Research Triangle Park and Raleigh-Durham International Airport. Calls to Chapel Hill, Cary, Raleigh, and other Triangle cities cost a 6-cent “hook-on” and 4.5-cent per minute rate.
2. The Chapel Hill Border Plan, designated with a “408” prefix. This plan allows unlimited calls to Chapel Hill, Research Triangle Park, and Raleigh-Durham International Airport. Calls to Durham (except 408 numbers), Cary, and Raleigh cost the 6-cent “hook-on” and 4.5 cents per minute.
There are cases where a Chapel Hill resident – with Verizon service and without a 408 prefix – could call another Chapel Hill number and pay a toll charge. Extended Area Service (EAS) would provide unlimited, flat-rate calling service, either at the applicable local exchange rate or the applicable local rate plus an EAS increment, rather than a long-distance charge. The Extended Area Service option would eliminate the need for the Chapel Hill Border Plan, because it would provide flat-rate calling between Verizon and BellSouth prefixes. The plan would most likely include a specific area, such as Chapel Hill and Durham.
The N.C. Utilities Commission could authorize such a plan after studying the community of interest and the costs involved in establishing a flat-rate system. Mr. Gerringer of the Utilities Commission estimates that this process could take nearly one year to complete. The process would include the following steps:
1. Documentation of need by the Commission. The Utilities Commission would conduct a preliminary assessment of support for Extended Area Service. It is at this stage that letters of support from the Legislative Delegation and the Town Council would be the most helpful to expedite the process.
2. Cost studies by telephone companies. The companies would be required to estimate the revenues that they could lose under an Extended Area Service plan. Mr. Gerringer estimates that this step could take approximately 90 days.
3. Commission review of cost studies. After the cost studies are complete, the Commission would then review figures submitted by the companies. This stage could take approximately 30 days.
4. Polling of customers. After the cost-study review, the Commission would require that each telephone company poll its customers, either through a separate mailing or bill insert, with ballots that detail the flat-rate costs that would be charged to customers. Mr. Gerringer estimates that this step could take 60-90 days to complete.
5. Commission review of polling results. In most cases, if 50% or more of those who vote are in favor of Extended Area Service, the Commission will approve the proposal. This process can often be done within 30 days.
6. Submittal of EAS Implementation Plan. Upon plan approval, the Commission would require the companies to submit an implementation plan for Extended Area Service. This process could take 30 days or more.
Advantages of Extended Area Service
· Consistency: Customers would pay a flat rate and would not face the long-distance charges that they have encountered when calling a nearby home or business.
· Simplicity: Separate Verizon listings would not be necessary, including those for Town offices.
· Wider calling area: Extended Area Service would provide more convenience for customers who could call locations in a larger area, without the expense of a toll charge.
Disadvantages of Extended Area Service
· Equity issues: The current system offers user-based pricing. Verizon says that the existing Border Plan places the cost of calling on the “cost-causer.” On the other hand, Extended Area Service is not user-based, so everyone would pay the same amount, regardless of their need to call between Chapel Hill and Durham. A new, flat-rate system could potentially create higher costs for telephone customers if the Utilities Commission agrees to a higher fee than what is currently in place.
· Opposition from telephone companies: Representatives from the Utilities Commission predict that telephone companies would oppose Extended Area Service, as they have in the past. The telephone companies may see flat-rate calling as a potential loss of revenue.
Next Steps: If the Council wishes to pursue Extended Area Service, we recommend adoption of Resolution B.
Some residents have raised concerns over inability to locate residents within Chapel Hill by using directory assistance. Verizon officials explain that there are occasions where this can happen because there is no single provider of directory assistance information. Often, the caller’s long-distance carrier is the provider of this information. For example, a caller who dials (919) 555-1212 will receive information from another company’s databases and not from BellSouth or Verizon. Although Verizon and BellSouth update their information daily, they cannot prevent other companies from buying and selling information databases that may not be accurate.
The only way to assure that a directory assistance-listed number is the most current is to dial 411 locally, which is fed separately from BellSouth and Verizon databases. Verizon and BellSouth officials say that they will work to ensure that this information is as cross-referenced as possible, so that a resident with a “Durham” number can still be found through a Chapel Hill listing.
Next Steps: Ongoing discussions and cross-referencing between the two companies to ensure sharing of accurate databases. The Town staff will provide the companies with the names and telephone numbers of Town citizens who notify us of further problems with their directory assistance listings.
According to both Verizon and BellSouth representatives, Chapel Hill residents, including those in the Border Plan, are listed at no charge in the BellSouth Chapel Hill telephone directory. Only Verizon customers are listed in Verizon books. Citizens are also entitled to one free “foreign directory” listing, meaning that they can appear once for no charge in the other company’s book.
Verizon and BellSouth officials state that they have corrected past errors in the listings in their directories.
Next Steps: Ongoing verification of accurate information in the directories by the two companies. The Town staff will provide the companies with the names and telephone numbers of Town citizens who notify us of further problems with their telephone directory listings.
Telephone Books Costs
Verizon officials say that individual customers who require more than one telephone directory can get free directories at Verizon Phone Marts, the Durham Chamber of Commerce, and the Durham Convention and Visitor’s Bureau. These agencies also offer free Triangle white page books, which are not published by Verizon. Verizon may charge for directories that must be mailed out of town.
BellSouth has a similar procedure and will offer free extra directories at the Chapel Hill-Carrboro Chamber of Commerce.
Next Steps: Ongoing follow-up by the companies to make sure that charges are assessed fairly and accurately. The Town staff will direct citizens to the appropriate outlets to receive their free directories. Staff will also provide the companies with the names and telephone numbers of Town citizens who notify us of problems receiving free directories.
Dispatch of Emergency Medical Services
Some residents have raised concerns about dispatch of emergency medical services because of the confusing telephone service areas that split counties. However, according to Orange County E-911 Center officials, there is no indication that this is a problem.
All calls from the Chapel Hill Town limits, whether located within Orange County or Durham County, route automatically to Orange County’s E-911 Center. This routing is achieved through the telephone companies’ routing switch, which uses street names and numbers loaded into a database.
When the E-911 centers are notified of an annexation by the Town of Chapel Hill, they update the telephone companies’ address databases to properly route the 911 call to Orange County.
Residents who attended the July 5 meeting shared their concerns about the routing of Emergency 911 calls to the appropriate County 911 Center. The Town Manager reported that the 911 routing had been corrected and encouraged residents to test the system by calling the 911 Center to be sure that calls were appropriately routed to Orange County.
Next Steps: We believe that there is no problem with E-911 dispatch, based on all of the information available.
RECOMMENDATION
That the Council approve both Resolution A and Resolution B.
Resolution A would ask BellSouth and Verizon to study the option of redrawing telephone service boundary lines in Chapel Hill to avoid dividing neighborhoods, and to provide follow-up information to the Council within 90 days.
Resolution B would request that the N.C. Utilities Commission begin procedures to establish an Extended Area Service (EAS) plan for Chapel Hill and Durham.
ATTACHMENTS
1. DRAFT Minutes of September 18, 2000 Public Forum (p. 8).
2. Manager’s Report, September 18, 2000 (p. 13).
3. Manager’s Report, July 5, 2000 (p. 15).
A RESOLUTION ASKING BELLSOUTH AND VERIZON TO STUDY THE OPTION OF REDRAWING TELEPHONE SERVICE BOUNDARY LINES IN CHAPEL HILL TO AVOID DIVIDING NEIGHBORHOODS, AND TO PROVIDE THE COUNCIL WITH FOLLOW-UP INFORMATION WITHIN 90 DAYS (2000-10-23/R-10a)
WHEREAS, residents of Chapel Hill are served by multiple telephone companies with varying boundary lines that do not align with Town limits; and
WHEREAS, these telephone service boundary lines often divide neighborhoods along the eastern portion of Chapel Hill, affecting residents in both Orange and Durham Counties; and
WHEREAS, citizens have voiced concern over the cost and confusion involved in calling neighbors who are served by a different telephone company;
NOW, THEREFORE, BE IT RESOLVED by the Council of the Town of Chapel Hill that the Council hereby asks BellSouth and Verizon to study the option of redrawing telephone service boundary lines in Chapel Hill to avoid dividing neighborhoods, and to provide the Council with follow-up information within 90 days.
This the 23rd day of October, 2000.
WHEREAS, residents of Chapel Hill are served by multiple telephone companies with varying calling plans; and
WHEREAS, these multiple calling plans create confusion and, at times, extra costs for Chapel Hill residents who live in both Orange and Durham counties; and
WHEREAS, citizens have voiced concern over the confusion and cost of these plans;
NOW, THEREFORE, BE IT RESOLVED by the Council of the Town of Chapel Hill that the Council hereby requests that the North Carolina Utilities Commission begin procedures to establish an Extended Area Service Plan for telephone service in Chapel Hill and Durham.
This the 23rd day of October, 2000.