Consumers speak out on Sprint request for rate hike

Malcolm Hall

Tuesday, March 19, 2002 | 11:08 a.m.

Sprint Corp. claims one factor behind its push for $90 million per year in rate hikes in Southern Nevada is the growing tide of people dropping their traditional telephone lines in favor of cell phones and the Internet.

But judging from comments before utility regulators Monday, a rate increase could drive even more to join the exodus. Before a sparse but clearly divided gathering in Summerlin Monday evening -- only about half of the 16 or so people who signed in chose to speak -- the Public Utilities Commission of Nevada conducted the first of five consumer comment sessions on Sprint's plan to increase basic telephone rates by 76 percent in Las Vegas, its first rate increase in three years.

The next session is at 6 p.m. today in the Henderson Convention Center at 200 Water St.

Sprint says 20 percent of Nevadans now have no traditional phone lines. It says this change in consumer phone use patterns, along with a growing disparity between its revenues and capital construction requirements, are why it wants to raise basic residential service rates from $9.05 to $15.95 and basic business rates to $22.75. If approved, the new rates would be in effect until June 2005.

Rates also would rise for such services as Teen Talk features, directory assistance, unpublished numbers, service orders and connection charges and intrastate access charges. Sprint says the new rates would compare favorably with such markets as Portland, Ore., at $21.19 for a single line and Salt Lake City at $22.74.

But consumer Pamela Strancliffe told commissioners she has two phone lines, one for local and long distance calls and one for her computer, and her phone bill would rise from $30.07 per month to $55.10 if the rate hike is approved and, "that's totally unacceptable. We would definitely drop one line and maybe both."

Robert Drymalski said early in life he learned a valuable doctrine -- don't bite the hand that feeds you -- but that now a whole group of companies is biting hands.

"These organizations need to be more creative because in the end, these organizations are biting the hands of the public," he said.

Sprint has invested more than $1 billion in Southern Nevada since it entered the market in 1993 and plans to spend another $869 million over the next five years building out its telephone and data systems. Some in attendance Monday cited Sprint's local systems and services for their success in Southern Nevada.

Businessman David Pearce said he's not against the rate hike because without Sprint, his tool retailing business might have failed. Pearce said he was relatively successful until 1997, when the big box retailers like Home Depot moved in, prompting him to take his business to the Internet.

"We grew 500 percent in five years and tripled our staff," he said. "Sprint helped us with the technology to get online. But when we started we had bottlenecks."

Pearce said the business "hit a wall" when too many orders started pouring in, overwhelming his equipment, but "Sprint helped us out. They're not the biggest piece of our success but they are a piece of it. We need to spend for technology."

Brett Torino, who runs the Project Sunshine foundation that operates a ranch for sick children from Child Haven, said his programs were in jeopardy because the ranch's phone system was not able to guarantee that emergency services and doctors could be called in case a child needed emergency attention.

"We went to Sprint and they stepped up to the plate and put in a new phone system," he said.

Representing the Las Vegas Chamber of Commerce, Michael Phillips said the business community believes that a modern technological infrastructure in Las Vegas is vital to the city's growth and believes that Sprint has the same vision.

"Southern Nevada is one of the best places to start or relocate a business," he said. "And telecommunications is a vital part of our economy and the reason Yahoo magazine named this the sixth most wired city in the country. It wouldn't be this way without Sprint's investment."

Las Vegas Chamber of Commerce President Kara Kelley said Phillips was sent on behalf of the chamber to "speak to the necessity of a strong technical infrastructure" for business diversification and business expansion, but that the chamber isn't taking a position on neither Sprint's nor Nevada Power's rate cases.

After asking some detailed questions about rate components, Joe Bifano, a candidate for the District 29 state assembly seat, said he's tired of utility officials not being able to provide him with answers to his questions because they say they don't know.

"Here we go again, first Nevada Power and now Sprint asking consumers to go into their pockets. How are the people supposed to know why there are increases here and there," he said. "We shouldn't have to get answers from the Public Utilities Commission or the Attorney General's office, we should get them from you."

Taking a different approach was Summerlin resident Kathleen Eckel, who retired from the telecommunications business and then did contract work for Sprint in Southern Nevada and said there's "no way" she will pay rate increases. Eckel said the company mismanages funds, applies Band-Aids instead of fixing problems and has no accurate record of its telephone line infrastructure.

"They have no idea how the lines get to your home," she said. "I think they want out of Las Vegas. I don't think they were prepared for this growth. I think they were happy they were going to be bought out by MCI (WorldCom) and when it fell through their whole world collapsed."

Lou Emmert, vice president and general manager for Sprint Nevada, said the consumer session was about what she expected. "I can understand the peoples' concerns and welcome their questions first hand and the chance to answer them," she said.

Consumer sessions continue Wednesday at the Silver Mesa Recreation Center, 4025 Allen Lane in North Las Vegas; Thursday at 6 p.m. at the Winchester Community Center, 3130 S. McLeod Drive; and April 11 at the North Las Vegas Library at 2300 Civic Center Drive.

Formal hearings are scheduled to begin May 13.