The telephone industry yesterday asked regulators to double the $2-a-month charge paid by residential customers for access to long-distance service, barely two months after the charge went from $1 to $2.
The United States Telephone Association, representing more than 1,100 local telephone companies and several other industry groups, said the increase is necessary to eliminate the subsidy of local telephone rates with long-distance revenue.
"The plan is recommending an increase in . . . charges to bring the cost of telephone service more in line with the actual cost of providing it," said Paul Rogoski, a spokesman for USTA. "The increase would be offset with a reduction in long-distance rates."
Under the plan, $1 a month would be added to the current $2 access charge on June 1, 1987, and another $1 would be added on Jan. 1, 1988.
The plan was not met with approval on Capitol Hill yesterday.
"I think it's bad news for all Americans living on a limited budget," said Rep. Ron Wyden (D-Ore.), a member of the House Energy and Commerce Committee. "Low-income seniors, the handicapped and the poor are all going to be very hard hit by this."
Until the "subscriber-line charge" was implemented, local telephone companies made long-distance companies bear the cost of upkeep for equipment that connects the local telephone network to the long-distance system. In turn, the long-distance companies passed those costs on to long-distance users.
The Federal Communications Commission said the cost of maintaining this equipment totals $10.8 billion a year. Since the $2-a-month fees only provide $3.7 billion a year, the telephone companies argue that long-distance companies are unfairly being asked to pay the remaining $7.1 billion a year.
The telephone industry has argued long-distance rates are thus kept artificially high and that many large businesses may build their own telephone networks to avoid paying the higher charges. They argue, this would leave all other customers paying higher charges for local telephone service.
The concept of a subscriber-line charge was first engineered by the FCC in 1982.
Under the plan, residential customers would have initally paid $2 a month, and then $6 a month for access to the long-distance network within five years.
The plan adopted by the FCC came under intense fire from Congress and consumer advocacy groups, and legislation threatened to overturn it in 1983.
But the legislation was tabled when the FCC agreed to a compromise plan. Under the plan, businesses with more than one telephone line are charged up to $6 a month per telephone line, subject to state regulation.
Residential and small business customers now pay $2 a month in local charges. The charges are currently capped at these amounts.
The FCC is considering the current plan and whether to raise the rates. The new proposal was presented as part of that process.
Wyden said that even large reductions in long-distance rates would not offset the increase in local charges for the bulk of residential users who make few long-distance calls.
He also said he did not believe the argument that large businesses were building their own networks on a massive scale to avoid the charges.
The FCC declined to comment on the proposal, which has not been formally submitted yet, but an official there said the issue boiled down to fairness.
"These costs are incurred whether the subscriber makes long-distance calls or not," the official said.
"But we expect the long-distance companies to pay because some of the plant enables them to initiate and complete long-distance calls."