PUC denies FairPoint penalty cut
State utilities regulators have denied FairPoint Communications' request to cut penalties it owes to customers for poor service, requiring the company to begin issuing more than $9.1 million in rebates next month.
The North Carolina-based company in October asked the Maine Public Utilities Commission to change the formula that sets penalties for failure to meet quality indicators, which would have reduced the penalty owed to about $4.5 million, according to the Maine Public Broadcasting Network. The penalty applies to quality benchmarks the company missed between Aug. 1, 2009, and July 30, 2010, according to The Associated Press. PUC Chair Jack Cashman told MPBN that though FairPoint has improved its service quality, the penalty is still warranted because FairPoint agreed to the formula provisions when it bought Verizon's land lines in 2008 and because "the company's management is responsible for the actual service quality problems." FairPoint must begin rebating customers in December for the next 12 months.
The company is currently paying an $8 million penalty for service problems in 2008-2009 through rebates to its customers, which amount to about $1.72 per line. Payment on that penalty ends Dec. 1.
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