PORTLAND, Maine — Regulatory hearings kicked off Wednesday in Maine on FairPoint Communications’ reorganization plan as the company winds its way through the complex bankruptcy process.
The Maine Public Utilities Commission is holding two days of hearings on FairPoint’s petition seeking PUC approval of its bankruptcy plan and modifications to the commission’s 2008 order approving FairPoint’s $2.3 billion purchase of Verizon’s land line and Internet operations in Maine, New Hampshire and Vermont.
More hearings are set this month before regulators in New Hampshire and Vermont.
They are considered important steps as FairPoint works its way through its Chapter 11 bankruptcy plan filed in U.S. Bankruptcy Court in New York last October. The hearings, along with a hearing that is scheduled in bankruptcy court next week on FairPoint’s supplemental bankruptcy plan, show the company is making prog-ress in its reorganization, said Maine Public Advocate Dick Davies.
“Slowly but surely, all the pieces that will become part of the final plan are emerging,” Davies said.
Weighed down by heavy debt and operational problems that led to customer defections, FairPoint filed for voluntary bankruptcy after agreeing on a deal with key lenders that would lower its debt from $2.7 billion to $1 billion and sharply cut its interest expenses.
As part of the process, FairPoint filed its reorganization plan and petitions seeking modifications from its original agreements with the Maine Public Utilities Commission, the New Hampshire Public Utilities Commission and the Vermont Public Service Board.
Hearings are scheduled for May 10-12 in Vermont and May 24-28 in New Hampshire.
Staff members of the boards, along with public advocates in each of the three states, have agreed to the plan. But it must still be approved by the regulatory boards themselves.
In Maine, FairPoint wants to delay the deadline from April until December on when it needs to complete the first phase of its broadband expansion plans. It also wants to lower the percentage of lines in Maine — from 90 to 87 percent — that would be capable of carrying broadband by the end of March 2013.
In New Hampshire, the company wants to push back its deadline from April to December on when it will be able to offer broadband to 85 percent of its customers, but it’s not seeking any changes on its five-year goals.
In Vermont, the original order stipulated that FairPoint provide 100 percent broadband availability to half of its exchanges by the end of 2010. The company is now seeking a six-month extension and to have to provide broadband to only 95 percent of lines in half of the exchanges, with the remaining 5 percent to be built on de-mand.
FairPoint officials said regulatory staff has agreed to the changes in all three states, but the regulatory boards themselves must still sign on.
“These are critical to us emerging from bankruptcy as we had originally hoped for, which is early fall,” said FairPoint spokesman Jeff Nevins.
FairPoint, based in Charlotte, N.C., owns and operates phone companies in 18 states with more than 1.6 million lines. Its largest holdings are in Maine, New Hampshire and Vermont.