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PSC Faces Phone Competition Question in Muddled Setting

Sept. 8, 2006 – In what one observer called a "muddled situation," the Virgin Islands Public Service Commission faces another obligation to figure out whether or not it wants telephone competition in the islands.
Some time ago the PSC, when faced with an application from Choice Communications to open up the telephone market to the forces of competition, voted no.
Telephone competition among carriers is the norm on the mainland; federal law only allows monopoly service in rural areas (and the islands are defined as rural) when the local regulatory agency decides that for one or more of three stipulated reasons it would be inappropriate to allow such competition.
In this setting the PSC decided that one of the three reasons applied in the Virgin Islands, namely that the competition would be inconsistent with the principles of Universal Service, a federal legal concept that says that quality service must be available to all at affordable rates. The PSC determined that competition would increase rates and therefore should not be allowed.
Regarding the other two reasons, the PSC said at the time that competition was technically feasible and that it would not be unduly burdensome economically on the existing provider, so only the Universal Service variable remained.
The PSC decision was fine with Innovative Telephone (formerly Vitelco) but not with Choice Communications, which has been trying to provide an alternative telephone service for at least six years. Choice Communications appealed to the federal district court and the judge, Stanley S. Brotman, said that the PSC decision was generally acceptable, but that PSC needed to develop a better rationale for its position that competition would undermine the Universal Service concept.
On July 15, 2005, Brotman gave the PSC 60 days to either modify the text of its decision or take some other action. Innovative appealed to the Third Circuit Court of Appeals, and that body said the matter could not be appealed because the PSC had not completed its work – in other words, there was no final decision from which to appeal.
Then things really became complicated. First the PSC said that it was a seven-member body, that there were three vacancies and the four members could not be brought together at any one time to act on the matter.
Later, on July 24, 2006, after three nominees sent by Gov. Charles W. Turnbull to the Senate were approved, the PSC notified the various parties that it had set a schedule for briefings and arguments so that it could meet Brotman's requirements.
Then, a week later on Aug. 31, the PSC issued a Procedural Notice saying that it herein "'suspends' [quotation marks in the original document] the balance of the schedule until it receives further formal instruction from the Clerk's Office of the U.S. District Court from St. Thomas and St. John."
Earlier in the release the PSC had stated that it "has received no additional instructions from the Court in this matter…" Why the PSC needed instructions over and above Brotman's original ruling was not explained.
So, more than a year after Judge Brotman gave the PSC 60 days to rewrite a document, there has been no progress.
"We are extremely disappointed that the Public Service Commission has failed to respond to an opportunity to reconsider whether or not competition in basic telephone services makes sense for the U.S. Virgin Islands." That was the response of Cornelius B. Prior Jr., chairman of Choice Communications, when asked for his reaction to the flow of events.
Earlier this week, however, PSC Chairwoman Alecia Wells said it was time to address several matters pertaining to Vitelco. ( See "PSC Needs Answers on Variety of Vitelco Matters, Chairwoman Says").

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