Utah Legislature 81021PUT

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MINUTES OF THE
    PUBLIC UTILITIES AND TECHNOLOGY INTERIM COMMITTEE
Wednesday, October 21, 1998 - 2:00 p.m. - Room 223 - State Capitol

Members Present:
    Sen. Lorin V. Jones, Co-Chair
    Rep. Beverly Ann Evans, Co-Chair
    Sen. Mike Dmitrich
    Sen. John P. Holmgren
    Sen. Alarik Myrin
    Sen. Craig A. Peterson
    Rep. Ralph Becker
    Rep. Orville D. Carnahan
    Rep. Gary F. Cox
    Rep. Brent H. Goodfellow
    Rep. J. Brent Haymond
    Rep. Dennis H. Iverson
    Rep. David M. Jones
    Rep. Swen Nielsen
    Rep. Jack Seitz
    Rep. Daniel H. Tuttle

Members Absent:
    Rep. Jeff Alexander
    Rep. Tom Hatch

Members Excused:

Staff Present:
    Mr. Richard North,
     Research Analyst
    Ms. Tani Pack Downing,
     Associate General Counsel
    Ms. Junie G. Anderson,

Legislative Secretary

Note:    A list of others present and a copy of materials distributed in the meeting are on file in the Office of Legislative Research and General Counsel.

1.    Call to Order - Chair Jones called the meeting to order at 2:23 p.m.

    MOTION: Rep. Iverson moved to approve the minutes of the August 19, 1998 meeting. The motion passed unanimously, with Sen. Dmitrich, Sen. Peterson, Rep. Carnahan, Rep. Haymond, Rep. Jones, Rep. Nielsen, and Rep. Tuttle absent for the vote.

2.     Public Service Commission - Statutory Report - Commissioner Steve Mecham, Chair, Public Service Commission (PSC), distributed a handout titled "The State of the Telecommunications Industry in Utah _ First Biannual Report to the Governor, Legislature, the Public Utilities and Technology Interim Committee, and the Information Technology Commission by the Public Service Commission of Utah." He discussed the topics outlined in the table of contents, providing analysis and recommendations for telecommunications.

    Commissioner Mecham reminded committee members that the report is a draft and will be revised as needed to improve the PSC's work. He also suggested that the PSC reporting requirements be changed to annual rather than biannual .

    Mr. Jeff Fox, Crossroads Urban Center, was concerned that other corporations may not be able to deal with the problem of a deregulated market that allows incumbent telephone companies to over-earn and stockpile large amounts of money that could be used to keep competitors out.

3.    Revisiting the Utah Telecommunications Act of 1995 - Proposed Legislative Solutions - Ms. Sue Ashdown, Coalition of Independent Internet Service Providers , distributed draft legislation titled "Telecommunications - Pricing New Services" which covers fair competition in providing new telephone services. She discussed recommended changes to the bill and told the committee she may make some changes to make sure the bill is retroactive and present the bill again at the November meeting.

    Ms. Shelley Cordon-Tuescher and Mr. Lyle Williamson, MCI WORLDCOM, distributed a handout titled "Local Loop Divestiture: A New Incentive to Invest in Utah." Ms. Tuescher gave a brief explanation of the MCI's desire to have a bill to divest the local loop.

    Mr. Williamson discussed the proposal for the local loop divestiture and indicated that MCI was researching legal support for the proposal. He summarized the document which included a conceptual framework offered by MCI WORLDCOM. Chair Evans asked that MCI work with Ms. Downing to prepare a draft for the November meeting and also requested that MCI present its legal support for the proposal.

4.    Year 2000 Report - Senator Bob Bennett, United States Senate, spoke about the Year 2000 (Y2K) issue. He also reported on the efforts of the Subcommittee on Technology and Financial Services of which he is chair and is part of the Senate Banking Committee.

    The senator expressed concern over problems facing the banking community as a result of Y2K. He discussed financial institutions' preparedness, legislation that Congress has passed, and proposed legislation. He commented on the probability that major power systems in our country will operate. However, some large organizations may depend on smaller organizations that are not Y2K compliant which will cause failure.

    Sen. Bennett also spoke about tax revenue problems if small businesses fail and said that he expects serious economic consequences that will cut into the overall tax revenue at both the state and federal levels.

    An article taken from the Internet titled "Do you know where your money is??" was distributed.

    Mr. Dave Moon, Chief Information Officer - Utah, distributed a report titled "Year 2000 Progress Report _ State of Utah Executive Branch Report." He summarized the report.

    Mr. Ed Leary, Commission, Department of Financial Institutions, provided an executive summary about Y2K preparedness of the financial institutions at the state level.

    Mr. Howard Headlee, Utah Bankers Association, briefed the committee on private sector bank efforts to cope with the Y2K problem. He expressed concern over small businesses that are not Y2K compliant and over organizations that profit from Y2K fears. The fears of business and residential customers might cause them to close their accounts and, thereby, force the ruin of businesses and financial institutions.

    Mr. Steve Hewlett, Department of Administrative Services, told the committee that legislation titled "Governmental Immunity" will be presented at the Information Technology Commission on October 22.

    Tracie Kenyon Karls, Utah League of Credit Unions, informed the committee that the 99 state-chartered credit unions are in phase two of their remediation plan and the 44 federal credit unions are also on track for meeting deadlines for Y2K compliancy and contingency plans.

5.    Information Technology Organizational Report/Recommendations - Mr. Moon distributed a report titled "Report to the Public Utilities and Technology Committee _ Information Technology Organizational Structure and Recommendations," and discussed it. He also briefed the committee on recommendations in the report that may require legislative approval. He indicated that he and Rep. Chard will present their bill to the Information Technology Commission in November.

6.    Adjournment - The chairs adjourned the meeting at 4:58 p.m.

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