FairPoint wants out of $845K in Maine fines

Posted July 07, 2009, at 9:07 a.m.

PORTLAND, Maine — FairPoint Communications has asked Maine regulators to be relieved of more than $845,000 in penalties imposed for poor wholesale service to local phone carriers.

The penalty imposed by the Maine Public Utilities Commission is part of $2.8 million that FairPoint estimates it owes to local phone competitors across northern New England for poor network service from February through April.

Additional penalties are expected for May and June.<

In filings with state regulators, FairPoint says some of the problems cropped up as it assumed control of Verizon’s wired telephone and high-speed Internet service assets in February were “beyond FairPoint’s control.”

Since taking total control of the Verizon system last winter, FairPoint has been plagued by customer service, billing and other operational problems. The problems also hurt competing phone carriers that utilize FairPoint’s network.

Local carriers in Maine that use FairPoint’s system oppose a waiver of the penalties. They say they’ve lost customers and revenue.

“We have been injured,” Fletcher Kittredge, chief executive officer at Great Works Internet in Biddeford, told the Portland Press Herald. “Now FairPoint is saying they shouldn’t have to pay penalties because they tried as hard as they could.”

Kittredge figures GWI, which has 20,000 customers in Maine, stands to receive more than $350,000 in penalties from FairPoint.

FairPoint said its efforts to be relieved of the penalties in northern New England is part of a broader effort to strengthen its finances.

FairPoint is also seeking to postpone a bond interest payment due in October on debts totaling $531 million. If it can’t be put off, the company might seek alternative debt-restructuring plans, which could include bankruptcy, FairPoint has said.

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