FairPoint airs woes, proposed solutions

Posted Aug. 11, 2009, at 10:34 p.m.

AUGUSTA, Maine — Executives at FairPoint Communications met with Gov. John Baldacci and state regulators Tuesday as part of a round of meetings this week focusing on lingering problems throughout the company’s network in northern New England.

FairPoint Chairman and CEO David Hauser briefed the governor and the Public Utilities Commission on plans to hire a consultant to identify computer and network issues believed to be causing many of the delays and other headaches reported by customers.

Company officials also discussed plans to file weekly reports with the state listing key benchmarks that will show whether FairPoint is improving or continuing to struggle.

“It was a positive, very straightforward and very frank meeting,” said David Farmer, spokesman for Baldacci.

FairPoint officials likely will face some tough questions today when they appear before the Legislature’s Utilities and Energy Committee during a special meeting to discuss the concerns regarding the company’s services.

That meeting, which is also expected to include testimony from Maine Public Advocate Richard Davies, will be held at 1 p.m. in Room 211 of the Cross State Office Building in Augusta.

Charlotte, N.C.-based FairPoint bought Verizon’s land line and Internet operations in Maine, Vermont and New Hampshire last year for $2.3 billion. The company took over operations Feb. 1, but its customers have been plagued with problems since, from billing errors and service order delays to long waits on call-in complaint lines.

In a meeting with the Bangor Daily News on Tuesday, Hauser and President Peter Nixon acknowledged that their broadband telecommunications changeover in the three states was more complicated than company officials had imagined. Hauser and Nixon agreed that FairPoint has stumbled since entering the New England market, but said they hope to turn the page.

“We’ve got to make some decisions about how to get our reputation back,” Hauser said during the meeting. “A year from now, we hope to be a well-oiled machine.”

In late July, the PUC’s three commissioners declined to waive the more than $845,000 in penalties assessed against the company for its failure to deliver timely services to smaller telecommunications companies.

During the same meeting, the commissioners also endorsed a proposal by Maine’s Public Advocate’s Office that FairPoint be required to hire an independent third party to examine the company’s “back office” computer systems and networks.

FairPoint’s decision to hire a consultant appears largely consistent with that proposal.

Andrew Hagler, director of the PUC group overseeing telephone and water utilities, said FairPoint officials also briefed the commissioners on the company’s efforts to place itself on a more secure financial footing.

Hagler said the commissioners expressed impatience with the company’s progress but otherwise refrained from asking many questions. Regulators in Maine, Vermont and New Hampshire are exploring holding a joint session with FairPoint officials in the coming weeks.

“It was a listening opportunity for the commission,” Hagler said.

A receptionist at the PUC incorrectly told a Bangor Daily News reporter who attempted to join Tuesday’s session that the commission’s meeting with FairPoint officials was closed to the public. Hagler later said the meeting was open.

Neither of Hauser’s meetings with Baldacci nor the commissioners was publicized. Hagler said that, unlike deliberative sessions and meetings where votes are held, the PUC is not required to issue public notices for all meetings between commissioners and representatives of regulated utilities.

It is not uncommon for new CEOs of utilities to come to the PUC for “meet and greet” sessions with the commissioners, he said.

“The commission meets with CEOs of utilities all of the time, and Mr. Hauser is fairly new,” Hagler said.

After their meeting with BDN staff in Bangor, FairPoint officials planned to meet with University of Maine System Chancellor Richard Pattenaude to discuss tensions between the two entities.

Hauser and Nixon expressed concerns about the broadband network that the UMaine System already has started building to serve some customers, such as The Jackson Laboratory. Hauser explained that if UMaine continues to cherry-pick certain businesses to provide service to, FairPoint’s business model will not be successful, particularly since UMaine receives government subsidies for which FairPoint is ineligible.

“We’re willing to work with them in a variety of ways,” Hauser said. “We have an open mind for dialogue.”

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