VOLUME 12, NUMBER 5               FEBRUARY 2, 2007

To: Members

From: David Crothers, Executive Vice President

The Association was pleased late Thursday afternoon when members of the Senate Political Subdivisions Committee adopted language sought by the independent telephone industry that allows telcos "two business days" instead of 24 hours to report changes made to E-911 databases. The legislation, SB 2409, is the Association of Counties attempt to update some of the State's E-911 legislation, as well as make prepaid wireless devices participate in the funding of emergency providers.

As you will recall, the Association earlier worked with sponsors of the legislation to ensure that telcos not lose the 5 percent administration fee they are eligible to receive for collecting and remitting the monies. An effort to prohibit telcos from charging for changes to the database was also rebuffed.

This week was also busy with hearings on the Attorney General's legislation to ban "pretexting" (SB 2255), a bill alternately described as a wireless customer bill of rights or a wireless company regulation bill (SB 2409), and a rare concurrent hearing on SCR 4014 and SB 2383, which is Senator Mathern's proposal to reduce the size of the Public Service Commission from 3 commissioners to one.

If you have any questions, please contact either myself or members of the Associations Legislative Committee. To call your legislator toll free the number is 1-888-635-3447. Bismarck-Mandan residents should call 328-3373. Members of the Legislative Committee can be found at the Association's homepage at www.ndatc.com.

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.

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.

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.

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.

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.

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.

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.

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.

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.

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.

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.

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.

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.

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.

CALL YOUR LEGISLATOR TOLL-FREE: 1-888-635-3447
LOCAL TELEPHONE NUMBER: 328-3373
WEB PAGE ADDRESS: www.state.nd.us/lr/