House Helps Rural Licensees

Supporters of improved rural telephone services continue to rally for adequate coverage and enough competition to provide consumers with some choices. But several rural wireless markets remain insufficiently covered. Interim providers serve these markets, and that creates another problem: As temporaries in rural areas, they're seldom inclined to spend revenue to upgrade service quality, some observers contend.

The U.S. House of Representatives has become an advocate for three underserved rural areas in Florida, Minnesota and Pennsylvania and for the three companies seeking licenses there. In 1992, the FCC dismissed license applications by Future-wave, Great Western Cellular Partners and Monroe Telephone Services (formerly Cellwave) to operate in Pennsylvania, Minnesota and Florida, respectively. The FCC said that the percentage of the companies' foreign ownership exceeded what regulations allowed.

Each company subsequently made changes to its businesses in an attempt to comply with the ownership limits and asked to reapply for the licenses, but the requests were denied. The companies also allege that the FCC is discriminating against them by refusing their applications while allowing other companies in similar situations to reapply.

The House has taken up the companies' cause by passing a bill containing an amendment mandating that the FCC accept the revised license applications and authorize the three companies as tentative licensees. After passing the measure, the House sent it to the Senate, where it passed previously without the amendment.

This isn't the first time that the House has tacked this provision to another bill. In 1998, it added the rural cellular provision to anti-slamming legislation, and although the legislation passed in the House, it died in the Senate. If the provision meets its demise in the Senate again, the companies and their lobbyists have the option of turning again to their allies in the House, who have been reviving this provision as standalone legislation or as a rider since 1996.

Some industry insiders don't think that this issue should be in Congress in the first place. The FCC should deal with licensing issues, said an attorney who advocates rural service. The attorney, who asked that his name be withheld, argued that legislators becoming involved in this issue is a sign that the FCC, which usually has an overflowing roster of licensing and spectrum issues to resolve, has put rural service providers on the back burner.