Frontier Urges FCC to Reject Delay Clearing Reorg
Restructuring Frontier Communications “manifestly benefits the public interest, with no countervailing harms,” trumpeted the carrier as it closed its case for FCC OK to emerge from Chapter 11. In replies posted Wednesday in docket 20-197, Frontier urged rejecting a union and consumer group’s concerns. Mississippi Public Service Commissioner Brandon Presley promised to stand in the deal's way unless the carrier improves.
Sign up for a free preview to unlock the rest of this article
Timely, relevant coverage of court proceedings and agency rulings involving tariffs, classification, valuation, origin and antidumping and countervailing duties. Each day, Trade Law Daily subscribers receive a daily headline email, in-depth PDF edition and access to all relevant documents via our trade law source document library and website.
The telco got clearance on its restructuring plan last month from U.S. Bankruptcy Court for the Southern District of New York (see 2008210052). Some state commissions said yes, including Illinois, Nebraska, Nevada, South Carolina, Utah and Virginia. Others are still reviewing, including California, Connecticut, Minnesota, Mississippi, New York, Pennsylvania and West Virginia, with some officials seeking service quality or deployment promises. Frontier is pushing for state OKs this autumn (see 2008190013). Connecticut’s schedule, last revised Sept. 1, stretches into February.
Nobody petitioned to deny restructuring, the carrier told the FCC. The Communications Workers of America and The Utility Reform Network jointly claim the FCC lacks enough information and propose “additional administrative processes -- a transparent delay tactic to gain leverage over and extract concessions,” it said. Frontier provided all required information, it said.
“There is no sinister arrangement of Senior Noteholders that would control Reorganized Frontier, as CWA/TURN seems to imply,” said Frontier. Those groups also raised concerns with a planned “virtual separation,” saying it could mean separating fiber deployment from copper operations, possibly to the copper’s detriment. Frontier replied that “the virtual separation review is an internal financial tracking and reporting exercise only.”
CWA and TURN urged the FCC to request data. The court-approved reorg didn’t answer their questions, including about the impact on "workforce, net cash flows, postemergence cash position, competitiveness, or service quality,” they wrote. “It also is unclear whether a final vote among impaired debtors has occurred, or how the mediation process resulted in any other changes, compromises, or other agreements among the parties. Furthermore, Frontier does not provide any explanation of new provisions relating to debtor-in-possession (DIP) financing” and other financing moves.
USTelecom urged quick OK. Frontier will “emerge as a stronger competitor,” the association said Tuesday.
Mississippi Commissioner Presley issued an ultimatum. “Either submit an immediate improvement plan for QUALITY customer service improvement,” the NARUC president tweeted Sunday, “or I will hold up your restructuring plan at the PSC until you do.” Frontier hasn't responded, the NARUC president emailed us Wednesday afternoon.
Frontier rejected a West Virginia PSC staff proposal to condition approval on the company deploying fiber (see 2009010018). Tuesday, the telco opposed intervention by the state’s Broadband Enhancement Council on grounds the PSC has no broadband jurisdiction. The council’s Aug. 27 petition “plainly shows that broadband deployment is the Broadband Council’s only interest in the proceeding and only reason for seeking to intervene,” Frontier said Tuesday. The council said it wanted to join the proceeding because it’s “vitally concerned with the likelihood and magnitude of Frontier’s participation in the” FCC’s Rural Digital Opportunity Fund and with “possible results of the bankruptcy case on Frontier’s financial stability.”
"We continue working with the FCC and other state commissions and responding as needed to move the approval process forward expeditiously," a Frontier spokesperson emailed Wednesday. "We are also reaching out to Commissioner Presley regarding his questions."