August 19, 1999

(OKLAHOMA CITY)--The Task Force on telecommunications formed June18 by the governor, legislative leaders, attorney general and then Corporation Commission Chairman Ed Apple made interim recommendations Aug. 19. The Task Force advised the Oklahoma Corporation Commission that it should proceed with its announced rulemaking on alternative regulation and should pursue reinvestment of a significant portion of Southwestern Bell’s apparent over earnings.

The task force noted a Commission staff report that based on 1996 financial data Southwestern Bell collected $91.6 million in excess revenue, including $28 million from Yellow Page operations. The task force furthered referenced two reports that Oklahoma is lagging in the broadband capabilities needed for high-speed internet access when compared to the other 49 states.

Commission Vice Chairman Denise Bode represented the OCC on the Task Force. On the issue of alternative regulation, Bode said "we need to invest in competition so we can grow Oklahoma business such as Educational World."

Commissioner Bode points out that investing in competition should lead to greater investment in infrastructure. Bode said "Oklahomans should be able to live anywhere in the state and do business anywhere in the world. That means ensuring that all Oklahoma has a first rate telecommunications system."

Bode said "this means encouraging Southwestern Bell to invest in competition so other companies such as Cox and MCI World Com will also invest in Oklahoma’s telecommunications infrastructure.

Commission Chairman Bob Anthony noted the rulemaking would allow the larger regulated companies the option of remaining under rate-of-return rules or moving to an alternative form of regulation.

"As we offer the option of alternative regulation, we need to make sure that real, robust competition becomes a reality. We don’t just want to open the door to

competition, we want to encourage people to crowd through that door bringing new investment and new opportunities to Oklahoma," Anthony said.

Commissioner Apple backed the move to competition. Apple said "the commission must look for competition in new ways, places and forms."

The task force report concluded "we must initiate efforts at the state level to catalyze investment in Oklahoma’s telecommunications infrastructure. The most recent proposal by Southwestern Bell to invest $200 million toward this noble end is a good starting point."

The task force adjourned with the possibility of a final meeting after the Commission completes its rulemaking in late September.