The Public Utilities Commission of Ohio isn't the regulatory watchdog it once was, but it deserves credit for continuing to hound our disconnected telephone company, Ameritech.
Already holding a $122 million fine for poor service over Ameritech's corporate head, the PUCO has blocked the company temporarily from sending $297.7 million in dividends to its San Antonio, Tex., parent, SBC Communications. The agency also is to hire an independent auditor to peruse Ameritech's books, and will actually bill the phone company for more than $10,000 in overtime incurred by state employees, who have fielded almost twice as many customer complaints in September and October than for all of 1999.
Customers are angry about installation backlogs, business lines that are crossed with residential or FAX lines, repair delays, missed or late service appointments, and the like. This is a serious problem because Ameritech is the primary provider of local phone service in Toledo and northwest Ohio with more than 380,000 lines. The company, has 4.1 million lines in 59 of 88 Ohio counties, or about 60 per cent of the state's local service. Altogether, it has some 21 million business and residential customers in Ohio, Michigan, Indiana, Illinois, and Wisconsin.
Like many businesses that cut their work forces after mergers, Ameritech, which joined SBC last year, is going to have to decide whether getting rid of all those employees was worth the trouble it has caused. Not that poor service is a new problem. The PUCO previously ordered Ameritech to spend $8.7 million to satisfy customer complaints dating back to mid-1998. If service doesn't get significantly better by January, 2002, the PUCO has pledged to collect the $122 million fine. In Michigan, where Ameritech took an average of five days to restore outages in August, the state Senate has voted a $1 million fine.
In an unusual show of unity, utility regulators from Ameritech's five-state region put the feet of SBC chairman Edward E. Whitacre, Jr., to the fire at a meeting in Chicago last month. Mr. Whitacre said that the worst of the phone company's problems are past, but he acknowledged that only 35 per cent of the repair and installation backlog had been cleared.
Fortunately, the PUCO seems prepared to sink its regulatory teeth into Ameritech's corporate wallet unless the company shapes up soon. While the relentless press of “free enterprise” has robbed the agency of much of the power it once held to set electric, natural gas, and telephone rates, this is a welcome show of force that reminds us why utility regulation is needed. With electric deregulation crackling onto the scene Jan. 1, the commissioners will need to keep their fangs sharpened.