IBEW members in N.H. rallied Thurs. outside a Portsmouth, N.H., hotel where FairPoint officials were meeting over lunch with local entrepreneurs to seek support for FairPoint’s proposed purchase of Verizon landline assets in northern New England. At the rally, members of IBEW Local 2320 spoke and carried signs declaring FairPoint lacks the resources to maintain and expand Verizon’s phone network, and relies too much on “antiquated” DSL to provide broadband service. The N.H. PUC plans hearings on the deal in Sept.

FairPoint Communications asked the Me. PUC to curb union participation in PUC review of its acquisition of Verizon’s Me. landline assets. The CWA and IBEW, representing 1,200 Verizon Me. employees, have attacked the deal as harmful to ratepayers and Me. economic growth, though FairPoint promised to retain current jobs and add 600, plus honor Verizon labor contracts. FairPoint (Case 2007-67) said union criticisms unfairly reached far beyond employment issues, marking efforts to kill the deal based on unsubstantiated general claims that FairPoint is too small and undercapitalized to run the Verizon network. FairPoint attorneys argued state law says PUC case intervenors can testify only on issues where their interests are “directly and substantially affected,” or where they have particular expertise. Unions, FairPoint said, have interest and expertise only on issues directly relating to labor, so union testimony should be limited to those areas. And, said FairPoint, the unions’ campaign against the deal and efforts to rally opponents taints any testimony they give, especially on non-labor merger issues. FairPoint officials termed the request normal for regulatory proceedings, but staffers with the Me. Public Advocate Office said attempts to limit an intervenor’s participation are unusual. They said FairPoint seems to wants to mute the unions and said they'd be surprised if the PUC goes along.

The Ky. PSC denied a petition by the CWA and IBEW to bar Windstream Communications from reducing part of its workforce in the state. The unions said the March 2 layoff of 46 Ky. customer service employees violated a state condition in a May 2006 PSC approval of the Alltel-Valor merger that formed Windstream and petitioned for enforcement of the merger order (Case 2007-00069). The PSC barred merger-related layoffs. But Windstream said the job reduction didn’t arise from the merger, but was part of a plan to consolidate customer service operations in 16 states. Windstream said the unions wrongly read the merger condition as a ban on Ky. job reductions for any reason. Windstream also said it is adding 14 technician and engineering jobs in Ky. The PSC said it hadn’t mandated that Windstream maintain employment at any specific level for any specific time, and can’t block Windstream from doing something it didn’t prohibit. But it held Windstream to its March 7 deadline to respond to the unions’ original petition for enforcement of the merger order.

Parties opposing Verizon’s $2.7 billion sale of northern New England landline assets to FairPoint Communications told the N.H. PUC their main concern is the small N.C.-based firm’s ability to run Verizon’s network. In N.H. alone Verizon’s network is bigger than all of FairPoint’s other current assets put together, they said. Representatives of Verizon employee unions, other local providers and electric utilities contested FairPoint’s capacity to deliver on its promises of network investment, expanded broadband and expanded employment. At a prehearing issues conference (Case DT-07-011), lawyers for CWA and IBEW union locals said FairPoint may have more debt than it can bear and so may not be able to carry the Verizon worker benefits it vowed to sustain. They claimed FairPoint lacks experience at serving large territories. CLEC representatives said they depend on the Verizon facilities and want service quality assurances because any significant deterioration in wholesale service quality under FairPoint would hurt them badly. They want guarantees that the transfer won’t drive up wholesale rates, though FairPoint promises no wholesale or retail rate increases. Electric utilities expressed concern about pole maintenance under FairPoint. Opponents said that, unlike with the Verizon operations, most FairPoint operating companies are covered by rural competition exemptions, relying heavily on federal universal service and rural infrastructure subsidies. Walter Leach, FairPoint exec. vp, said FairPoint’s experience with rural phone service and bringing broadband to rural markets make it a good fit for N.H. He said northern New England would be FairPoint’s biggest market and, unlike Verizon, FairPoint has every incentive to invest there. Other FairPoint officials defended the company’s financial base as strong. They said they understand opponents’ concerns but stressed that FairPoint has the will and ability to deliver jobs, broadband and service quality, and will showing the PUC and other interested parties exactly how they will do it in the course of this case.

Me., N.H. and Vt. regulators received joint applications for approval of Verizon’s $2.7 billion spinoff of its wireline operations in those states to FairPoint. The companies told the states that “no existing services will be discontinued or interrupted, nor will any rates change” due to the transfer, and “existing wholesale arrangements will remain largely the same.” The companies said FairPoint will “assume all the rights and obligations of Verizon” in the 3 states. The companies said FairPoint plans to keep Verizon’s workforce in the states and will honor contracts with Verizon’s unionized employees.

Unions are warning state regulators not to trust broadband promises from Verizon and FairPoint, which submitted joint applications to Me., N.H. and Vt. for approval of Verizon’s $2.7 billion spinoff of its wireline operations in those states to FairPoint. FairPoint said it was hiring at least 600 employees and expanding broadband availability to unserved areas. Communications Workers of America (CWA) and the International Brotherhood of Electrical Workers (IBEW) doubted the promises, with the IBEW saying Verizon seems to be playing a “shell game” to pump up its bottom line and avoid having to spend money on rural broadband. The IBEW said FairPoint has done little with fiber-based broadband and video in existing service area. It said the deal would leave northern New England served “by a much smaller company with fewer resources to expand Internet access… billions of dollars in debt and a very small margin for innovation.”

IBEW and CWA union locals representing 1,150 Verizon workers in N.H. wrote to legislative leaders and the N.H. PUC urging they block Verizon’s $2.7 billion spinoff of landline assets in N.H., Vt. and Me. to FairPoint Communications. The Thurs. N.H. dissent follows the unions’ similar action in Vt. (CD Jan 25 p7). Union officials said the N.H. PUC should deny approval unless FairPoint can prove it has the financial and managerial capability to provide quality service, create viable high-speed networks and keep quality jobs. The unions said they fear FairPoint lacks the resources to expand fiber- based high-speed data and video services, especially once it assumes about $1.7 billion in Verizon debt. The unions said they are concerned about FairPoint’s ability to compete with cable company telecom and video offerings if it can’t complete the fiber network Verizon had begun installing in southern N.H. for eventual video services. Verizon abandoned its N.H. video service plans early last year. The transaction must be approved by state regulators in N.H., Vt. and Me. as well as by federal authorities and the companies’ shareholders.

CWA and IBEW union locals in Vt. asked Vt. legislators to hold hearings on Verizon’s $2.7 billion sale of its northern New England landline operations to FairPoint Communications. Union officials at a Wed. rally at the Vt. state house said they fear FairPoint can’t cover the Verizon debt it will take on and keep investment and employment promises. The IBEW has 400 Verizon employees in Vt.; CWA, 125. The unions represent 2,800 Verizon workers in the 3 states. FairPoint officials said the unions’ fears are unfounded. FairPoint COO Peter Nixon said in a written statement: “We are willing to state today we are not going to be reducing pay or benefits as part of the negotiations” for new contracts to replace current ones that expire in 2008. Other officials said FairPoint’s plans to finance the deal include issuing $1 billion in new common stock. Walter Leach, exec. vp-corporate development, said Wall Street has treated the deal as “a very good and sound investment.” FairPoint earlier promised no layoffs and a $200 million investment in Vt., Me. and N.H. within 18 months of the transaction closing. The Vt. legislature has no direct authority over the transaction, but legislative hearings might influence Public Service Board review of the deal. PSB approval is required for the deal to close. Union dissent with the spinoff has been open only in Vt., but union locals in the other 2 states have aired similar concerns.

CBS Bcstg. and its largest union agreed to a 3-year contract extension. The agreement between the broadcaster and the International Brotherhood of Electrical Workers goes into effect Aug. 1, when the current contract expires. The union includes camera and sound operators, maintenance workers and editors. Members will get a 3% salary increase in each of the first 2 years of the contract and a 3.5% raise the 3rd year, CBS said. CBS agreed to “look for opportunities to assign IBEW technicians” to work in Internet and “emerging media” areas, such as the MediaFLO wireless video service, it said.

A Verizon plan to freeze non-union workers’ pensions drew fire Thurs. at a demonstration outside a major shareholders meeting in Boston. The Communications Workers of America (CWA) and the International Brotherhood of Electrical Workers (IBEW) held the rally, which included other complaints about the firm, such as Verizon’s board having more than one member in common with other public companies.