Costs, service drive Verizon rate request

  • By David S. Valdez
  • Friday, August 13, 2004 9:00pm
  • Opinion

When you make a phone call using Verizon’s telecommunications network, you expect that call to connect without delay, without interference and without exception – rain or shine. The same is true when you order new services from the company. And should you have a problem with your Verizon service, you want it fixed quickly by a trained technician who treats you with courtesy and professionalism.

At Verizon, we share your expectations regarding the level of service customers deserve. That’s why we spend so much time monitoring our service levels, surveying our customers and training our employees to deliver outstanding service. From basic local telephone service to complex, specialized services for business customers, Verizon stands ready to meet our customers’ telecommunications needs.

Customer satisfaction surveys show that Verizon is rated highly for its installation and repair services for both business and residential customers in Washington. In addition, we have to assure the Washington Utilities &Transportation Commission (WUTC) that we are able to meet the commission’s customer service standards. Today, Verizon is providing customers with a higher level of service than the combined service records of other telephone companies operating in Washington.

But providing quality customer service comes with a price. Telecommunications is very capital intensive, especially for a company like Verizon that serves customers throughout Washington state. Our service territory consists of suburban areas such as Redmond, Kirkland and Snohomish County, as well as many remote, sparsely populated rural areas such as the Palouse, Republic and Westport.

Verizon operates and maintains more than 2,400 miles of fiber-optic cable and 25,000 miles of copper cable in 18 counties statewide. And the company operates more than 200 digital switching locations that enable our customers to connect with each other and the world. We maintain about 620,000 residential phone lines and 235,000 business lines in the state. Maintaining these lines and supporting our customers are more than 1,800 highly trained employees. They take customer orders, assign facilities, handle installation work and complete repairs as needed. All of this is made possible by the company’s continued investment in the local telecommunications network and services.

The WUTC permits the company to charge basic rates to cover expenses, needed investment, and a reasonable rate of return on the investment. From time to time it is necessary to update this regulation. Today, Verizon customers pay a basic monthly service rate: $13 for residential customers and $29.70 for business customers. Low-income households eligible for the Washington Telephone Assistance Program pay only $8 per month for basic service. In addition, the company’s basic rates for business and residential customers have generally remained unchanged or have decreased during the past 22 years.

Meanwhile, Verizon has continued to invest in the telecommunications network in Washington. During the past four years alone, the company has invested more than $589 million to provide a high-quality network and state-of-the-art services. The company plans to spend an additional $89 million in 2004.

While the company has held the line on general increases in our residential and business rates for more than two decades, our intrastate revenues are no longer covering our expenses in Washington. Verizon is now seeking rate increases to continue to provide customers with the quality service they have come to expect.

Business and consumers alike benefit from a robust telecommunications network. While no one wants to pay more for any product or service, it is now time for the WUTC to update its outdated pricing structure. The commission needs to restore Verizon’s ability to reinvest in the local network and to maintain strong customer service levels by granting our request for increased rates.

David S. Valdez is vice president for public policy and external affairs for Verizon Northwest.

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