The D.C. Public Service Commission is scheduled to decide today how much to increase telephone bills for District residents, but will put off until November the tougher decision of who will pay the higher rates.
Chesapeake & Potomac Telephone Co. has asked for a phone rate increase of $54.3 million, which, if approved, could more than double basic local phone bills in the District.
The PSC said it will announce today only how much -- if any -- of the $54.3 million C&P should receive. This fall it will determine whether residential, business or government customers should bear the brunt of the increase and how much fees for various kinds of phone service should go up.
C&P has proposed increasing all basic phone service fees and wants to start imposing a separate fee just for having a telephone -- which it calls a dial tone charge -- plus additional charges for calls.
The proposal to charge separately for a dial tone and to raise rates for basic calling plans has been opposed by the Office of the People's Counsel, advisory neighborhood commissioners, City Council members and consumer groups such as the Gray Panthers.
Under its latest rate structure proposal, C&P wants residential customers to pay about $44.5 million of the $54.3 million increase it is seeking.
Business and government customers would pay the rest. As the result of another recent PSC ruling, charges for Centrex business services have declined by up to 30 percent and have been frozen for customers who agree to use it for five years. C&P earns about 20 percent of its revenue from the service.
Consumer advocates have complained that because of the cuts in Centrex rates, basic residential service will have to bear the brunt of any increase.
C&P first asked for higher rates a year ago and has revised its original $75.8 million request downward three times after making new calculations. Chief provisions of the latest request are:
*The basic charge just to hear a dial tone would be $13.42 a month.
*The cost of metropolitan area-wide unlimited calling would rise from the current $12.49 a month to a total of $23.54, including a dial tone charge of $13.42, plus an additional $10.12 a month for usage.
*Measured areawide service, which currently costs $6.38 a month, would rise to at least $14.97 -- $13.42 for a dial tone plus $1.55 for the first 60 calls a month.
*District of Columbia unlimited calling would rise from $6.38 a month to $19.78 -- the dial tone charge of $13.42 plus $6.36 for usage.
*Those on the D.C. unlimited calling plan who place local calls outside the District and those who subscribe to measured service but exceed their 60-call allowance would have their cost per call cut from 6.9 cents each to 4.53 cents per call.
*Pay phone rates would rise from 15 cents per call to 20 cents per call.
*A "lifeline" plan for the poor would cost $4 a month for a dial tone and 30 calls. The lifeline plan would not be put into effect without a means test -- a proposal that has been attacked as demeaning for the poor and elderly by consumer groups and some City Council members.
To pay for the lifeline service, C&P wants a tax credit from the city government to make up the difference between the $4 monthly lifeline service charge and the usual $13.42 a month dial tone fee. C&P says the cost of subsidizing service to the poor ought to be subtracted from the taxes the phone company pays the city, in effect taking it out of the city's general fund.
"We feel it ought to be paid from the tax revenues, and the plan should be administered by the city government," said Web Chamberlin, spokesman for the phone company. "Some people think it ought to be in the rate base and everybody pays for it."
The C&P rate chase has drawn intense criticism from politicians and consumer advocates who charge the Public Service Commission is predisposed to the interests of big business over the interests of consumers.
"Here we are, all united for the poor of the city," said Valerie Costello, an advisory neighborhood commissioner who stood in the hot sun two days ago in front of the Public Service Commission building at 451 Indiana Ave. NW to protest the proposed rate increase. "I am sure the PSC is aligned with special interests," she said.
Ethel Weisser, a member of the Gray Panthers, a group that lobbies on behalf of the elderly, said "C&P is a public utility, but somewhere along the line the definition has changed.
"This is a company that wants to expand its commerical and competitive trade and defray the cost of capital investment by spreading it onto monopoly phone users," she said.
In 1984, C&P earned $35 million in profit in the District on revenue of $196 million. C&P has argued it needs more money because the cost of doing business has increased over the last year. C&P said competition in the telecommunications business is taking some business away and basic rates are no longer subsidized by long-distance revenue or equipment that the phone company provided before the breakup of the Bell System in 1984. The company is earning only a 9 percent return on its investment in facilities in Washington but should be making 12.25 percent, said Chamberlin.