Who does consumer bill really help out?
Published: Saturday, April 1, 2006 at 6:01 a.m.
Last Modified: Friday, March 31, 2006 at 10:36 p.m.
The bill is called the "Consumer Choice Act of 2006."
But not many consumers seem to be directly involved in the heavily lobbied legislation (HB 1199) that has pitted the phone companies against the cable industry over the right to deliver cable television services into Florida homes.
And those interest groups have a lot more clout in Tallahassee than the average consumer because of one simple reason - they give a lot of campaign cash to legislators.
Since the last election, phone and cable interests have poured more than $445,000 into the state Republican and Democratic party funds, election records show. The Republicans, who control the House and Senate, have collected $375,000 from phone and cable companies to the Democrats' $70,000.
Since January 2005, when the new election cycle began, the phone and cable contributions to state parties have included:
Critics of the fund-raising process say such large donations often raise the agenda of the interest groups over the agenda of the consumers.
"Consumers aren't able to make significant campaign contributions - and certainly not in that league," said Ben Wilcox, director of Common Cause of Florida.
Wilcox said he finds the contributions from the phone and cable firms "particularly galling," since the companies make their money off consumers and then turn around use part of their funds to influence lawmakers for issues "that are usually not in the best interest of consumers."
As another example of the practice, Wilcox cited the 2003 passage of a phone bill, which was touted as a consumer-friendly measure, although it gave local phone companies the right to raise rates up to 20 percent a year.
Lawmakers discounted the impact of campaign contributions on the process.
Rep. Trey Traviesa, R-Tampa, who is sponsoring the cable television bill, said no one in the party leadership has talked to him about the contributions. "I think both cable and telecommunications (companies) are supporters of the political process," he said. "They're against each other in this one, so I think they cancel each other out."
Traviesa said he was motivated by consumer interests when he devised the bill, while realizing it was "very clear that there were a lot of parties with high stakes" involved in the legislation.
It included the cable companies that want to protect their existing franchises, the phone companies that want an easier way to enter the cable TV market and the cities and counties that also have a major interest in the existing cable franchises. But Traviesa said "nobody was speaking for the consumer."
And he said saw an opportunity to change that.
"Industry can take care of themselves. City and county governments can take care of themselves. But somebody needs to be out there advocating hard for the individual citizen who this benefits so much and who has been getting a raw deal for a while," Traviesa said.
His argument is by replacing the existing local cable TV franchise with statewide franchises, it will allow more competition in the market and consumers will benefit from lower prices.
Phone companies say rates could be cut by 15 percent or more, saving consumers more than $600 million a year.
"It's very clear," Traviesa said. "When a monopoly cable provider is faced with competition, prices come down immediately, substantially and lots of customers use the power to switch to choose what they think is right for them."
But cable companies question whether consumers would be fairly treated under the proposal. In testifying before the House Committee on Utilities and Telecommunications, Steve Wilkerson, president of the Florida Cable Telecommunications Association, said that phone lobbyists had spent millions of dollars in Texas last year passing a similar bill, which he described as "a thinly veiled attempt to give them preferential treatment as they entered the cable television market."
Wilkerson questioned whether Traviesa's bill would help consumers. He said it could hurt consumers in low-income neighborhoods since it removes a provision requiring cable franchise holders to serve all communities.
"In fact, the bill really, I think, is designed purposely to deny a lot of consumers the benefit of choice if they're living in the wrong neighborhoods," he said.
Phone company representatives say under a statewide franchise system they would still cover most neighborhoods, noting minority consumers are among the heaviest users of cable services.
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