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Pass Real Telecom Reform and Promote Innovation!

by Brent Mead / /


Dear Senator:

On behalf of the National Taxpayers Union’s (NTU’s) 7,300 members in Colorado, I urge to you to pass Senate Bill 157 to update and modernize the state’s telecommunications regulatory framework. Colorado’s current system is woefully out-of-date and does not reflect the changes witnessed over the past 20 years in technology or increased industry competition.  

SB 157 proposes basic, common sense reforms to a woefully outdated regulatory structure, which threatens innovation and economic growth. The bill phases out the state’s 2.9 percent High Cost Fund tax by 2025. This tax, originally enacted in the 1980s, hits all landlines and cell phones to subsidize services to remote customers. Whatever its flaws back then, the levy makes even less sense now, given that Colorado has 4.7 million cell phone subscribers, 99.8 percent of the U.S. population now has access to wireless service, and 97 percent is covered by at least three carriers. Additionally, this tax, applied regardless of the carrier, taps consumers for about $53 million per year, $50 million of which is recycled to subsidize the operations of a single telecom provider. By overhauling the archaic laws governing telecom firms, the state will be able to better serve these consumers as well as taxpayers, in the process giving Colorado greater potential to occupy the cutting edge of Information Age technology.

While NTU supports the eventual elimination of the High Cost Fund, we have concerns over SB 157’s creation of a new Broadband Investment Fund. Rather than divert a portion of the savings from drawing down the High Cost Fund to this new entity, the entirety of the savings should be passed along to consumers. However, these concerns are mitigated by the fact that the new program has controls on what entities are eligible for funding and that the program has a sunset date of 2025. If this provision of the bill is enacted, consistent oversight will be necessary to ensure this date remains firm.

Finally, NTU supports other provisions found in the bill, such as equalizing state and federal access rates, eliminating outdated tariff filing requirements, and generally bringing state regulatory definitions in line with current federal rules.  

The Senate can and should pass this vitally important legislation. The time has come for Colorado to create a modern regulatory system that is up to the task of protecting consumers and providing a hospitable climate for investment and innovation in our 21st Century economy.

Sincerely,

Brent Mead
State Government Affairs Manager