Utah Legislature 81118PUT

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MINUTES OF THE
    PUBLIC UTILITIES AND TECHNOLOGY INTERIM COMMITTEE
Wednesday, November 18, 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
    Rep. Ralph Becker
    Rep. Orville D. Carnahan
    Rep. Gary F. Cox
    Rep. Brent H. Goodfellow
    Rep. Tom Hatch
    Rep. J. Brent Haymond
    Rep. Dennis H. Iverson
    Rep. David M. Jones
    Rep. Jack Seitz

Members Absent:
    Sen. Craig A. Peterson
    Rep. Jeff Alexander
    Rep. Daniel H. Tuttle

Members Excused:
    Rep. Swen Nielsen

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 Evans called the meeting to order at 2:25 p.m.

    MOTION: Rep. Goodfellow moved to approve the minutes of the October 21, 1998 meeting. The motion passed unanimously, with Sen. Dmitrich, Sen. Holmgren, Rep. Becker , and Rep. Jones absent for the vote.

2.    Year 2000 Report - Summary Information - Mr. Dave Moon, Chief Information Officer, briefed the committee on the status of the state's Y2K remediation efforts. He also informed members that he and the Information Technology Chairs, Sen. David Steele, and Rep. Blake Chard have developed a process to be used during the General Session that will keep legislators updated on the Y2K issue. He said more than 60 percent of the state's systems are compliant.

    Mr. Moon also reported that Utah is keeping up with the progress of other states in achieving compliance in the welfare-oriented systems.

    He suggested that consideration be given to closing state offices on Monday, July 3, 1999, in honor of the July 4 holiday so testing to the systems could be done on that day.

3.    Digital TV Presentation and Demonstration - Mr. Steve Hess, Utah Education Network (UEN), discussed funding requests for EDNET, UtahLINK, and KULC/KUED. He also said that all TV stations need to convert to digital television within the next five years.

    Mr. Fred Esplin, KUED, briefed the committee on digital television and gave a demonstration. He distributed a brochure titled "Picture a Time in Your Future When Things Become Perfectly Clear." He also discussed the future costs.

4.    Proposed Committee Legislation -    Ms. Downing explained that the amendment to draft legislation titled "Public Service Commission Reporting," which was mailed to committee members prior to the meeting, will change the reporting requirement from a biannual to an annual report from the PSC.

     MOTION: Rep. Goodfellow moved to approve draft legislation titled "Public Service Commission Reporting" as a committee bill. The motion passed unanimously, with Sen. Dmitrich, Sen. Holmgren, Rep. Becker, and Rep. Jones absent for the vote.

    Ms. Sue Ashdown, Coalition of Independent Internet Service Providers , discussed draft legislation titled "Telecommunications - Pricing New Services," which was mailed to committee members prior to the meeting. She indicated that the current law only permits the PSC to revoke the authority to offer the new service if competition does not exist, but that her proposed language would permit the PSC to require the service continue to be provided under tariff. In addition, the PSC could not permit new services to be price listed unless competition existed, or was likely to develop, and was in the public's interest.

    Mr. Ted Smith, U S West, spoke against the legislation. He said there is no reason to change existing law on this issue.

    Mr. Steve Mecham, Public Service Commission (PSC), said the PSC will not take a stand on this legislation.

    Mr. Bill Evans, attorney for Internet Service Providers Coalition (ISP), said the reason for the proposed legislation is to allow the PSC to control the process to ensure competition would develop in the provision of telecommunication services. He also said the available remedy would not allow anyone in Utah to have DSL.

    Mr. Rick Campbell, Division of Public Utilities, said U S West made significant concessions and adjustments to accommodate the concerns of the ISPs.

     MOTION: Rep. Haymond moved to proceed to the next item on the agenda. The motion passed unanimously, with Sen. Holmgren, Rep. Jones, and Rep. Seitz absent for the vote.

    Ms. Downing distributed and discussed draft legislation titled "Telecommunications Price Freeze Amendments." She indicated the draft provided that the PSC on or before December 31, 1999, establish a price index after which the price freeze would be terminated.

    Mr. Smith explained that U S West opposes the legislation. He distributed a report to the governor and the Legislature titled "The State of the Telecommunications Industry in Utah prepared by U S West." He explained the report to committee members which contested some of the information in the report last month by the PSC regarding the level of competition in the state.

    Mr. Mecham distributed a report 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." This report is an update of the report the PSC presented in October. He said the legislation reflects what is indicated in the report and spoke in support of the bill.

    Mr. Roger Ball, Utah Committee of Consumer Services, said competition is necessary for the citizens of Utah. He spoke in support of the legislation.

    Ms. Betsy Wolf, Salt Lake Community Action Program, also spoke in support of the bill.

    Mr. Gerry Capps, Utah citizen, said if the PSC is not supported and given more authority, there may not be an orderly transition from a monopoly to a competitive marketplace.

    Mr. Jeff Fox, Crossroads Urban Center, stated that there is an over-earning by U S West because of a lack of competition in Utah.

     MOTION: Sen. Myrin moved to go to the next item on the agenda. The motion passed, with Rep. Jones opposing the motion. Rep. Becker, Rep. Carnahan, and Rep. Iverson were absent for the vote.

    Rep. Gene Davis discussed draft legislation titled "Financial Identity Fraud." He stated that the bill provides a penalty for financial identity fraud, permits the Division of Consumer Protection to investigate any complaints, and explains the prosecution process.

     MOTION: Rep. Jones moved to approve draft legislation titled "Financial Identity Fraud" as a committee bill. The motion passed unanimously, with Rep. Becker, Rep. Carnahan, and Rep. Iverson absent for the vote.

    Ms. Shelley Cordon-Tuescher, MCI WORLDCOM, discussed draft legislation titled "Local Loop Divestiture," and explained that MCI had decided not to ask the committee to vote on the bill at this time but requested MCI be given the opportunity to familiarize the committee with the issue of requiring the incumbent telephone company to divest the local loop, the creation of a company to run the local loop, and adequate compensation for the loop.

    Mr. Lyle Williamson, MCI WORLDCOM, distributed three articles from The Wall Street Journal titled "Telecommunications Overview - Out of the Loop," "Telecommunications Breakup - Cut the Connection," and "Telecommunications Borrowed Lines - Locked Out." He also explained why this legislation is important to the state of Utah.

     MOTION: Rep. Goodfellow moved to go to the next item on the agenda. The motion passed unanimously, with Rep. Carnahan and Rep. Iverson absent for the vote.

    Ms. Downing explained the substance of Rep. Chard's bill, "Information Technology Restructuring."

     MOTION: Rep. Haymond moved to approve draft legislation titled "Information Technology Restructuring." The motion passed unanimously, with Rep. Carnahan and Rep. Iverson absent for the vote.

    Ms. Downing explained the substance of Sen. Steele's bill, "Electronic Transmission of Tax Notice Information."

     MOTION: Rep. Haymond moved to approve draft legislation titled "Electronic Transmission of Tax Notice Information." The motion passed unanimously, with Rep. Carnahan and Rep. Iverson absent for the vote.

    Sen. Steele introduced draft legislation titled "Year 2000 Governmental Immunity" which was mailed to committee members prior to the meeting. He addressed areas of concern that were raised during interim study regarding the extension of immunity to cover negligence when current sovereign immunity statutes do not extend to negligence as well as the possible loss of incentive to governmental entities to try and remedy any Y2K problems because they believed they had immunity.

    Ms. Downing explained the draft legal review note for the governmental immunity legislation.

     MOTION: Sen. Jones moved to approve draft legislation titled "Year 2000 Governmental Immunity." The motion passed, with Sen. Myrin, Rep. Becker, Rep. Cox, and Rep. Seitz voting in opposition to the motion. Rep. Carnahan and Rep. Iverson were absent for the vote.

     SUBSTITUTE MOTION: Sen. Myrin moved to endorse the concept of the draft legislation, with additional input. The motion failed, with Sen. Myrin, Rep. Becker, Rep. Cox, and Rep. Seitz voting in favor of the motion. Rep. Carnahan and Rep. Iverson were absent for the vote. The vote went back to the original motion. The motion passed as indicated.

5.     Committee Issues - Chair Evans said draft legislation titled "Electric Restructuring Study" will possibly be studied during the first part of the interim period.

6.    Electric Deregulation and Customer Choice Task Force Report - Task Force Co- Chair, Beverly Evans, commended Brian Allred from the Office of Legislative Research and General Counsel for the excellent work he did in producing the report. She discussed the report and distributed a handout titled "Report of the Electric Deregulation and Customer Choice Task Force."

7.    Other Business - Chair Evans asked that any suggested study items for the 1999 interim period be submitted to staff as soon as possible.

8.    Adjournment -

    The meeting adjourned at 4:40 p.m.

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