SB 138-THIRD-PARTY CHARGES ON TELEPHONE BILLS  1:36:38 PM CHAIR FRENCH announced the consideration of SB 138 and asked for a motion to adopt the proposed committee substitute (CS), version U. 1:36:47 PM SENATOR WIELECHOWSKI moved to adopt the committee substitute for SB 138, labeled 27-LS1002\U, as the working document. CHAIR FRENCH announced that without objection, version U was before the committee. SENATOR WIELECHOWSKI, speaking as the sponsor of SB 138, said Mr. Presley would present the CS. 1:37:40 PM THOMAS PRESLEY, Intern to Senator Bill Wielechowski, sponsor of SB 138, said version U incorporates the three amendments that the Alaska Communication Service (ACS) offered during the last hearing. Subsection (c) on page 2, lines 11-15, contains new language that says that a customer who contests a charge on their bill must inform the telecommunications carrier, either orally or electronically, of the reason for nonpayment. New subsection (d) on page 2, lines 17-19, allows a telecommunications carrier to recover from third-party vendors, reasonable costs incurred in implementing billing changes or otherwise complying with Sec. 42.05.715. New subsection (d) on page [3], lines 28-30, absolves telecommunications carriers of the duty to verify independently the accuracy of information received from a person or billing under this section. MR. PRESLEY said he forwarded a copy of the new CS to Alaska Communication Services (ACS) and he anticipated their approval. He informed the committee that both Verizon and AT&T voluntarily pledged to discontinue, by August, billing for all third-party enhanced services that are not telephone related. 1:40:17 PM BOB LOHR, Executive Director, Alaska Center for Public Policy, stated support for SB 138 and relayed that he was speaking as a former executive director of the Public Utilities Commission and a former chief insurance regulator for the State of Alaska. He described the legislation as timely and important consumer protection. He disputed the notion that third-party billing was important to consumers to reduce costs and expand competitive choice because this was not an effectively competitive market. Two assumptions that economists make about competitive markets are that there is perfect information available and there is zero transaction cost. Both are demonstrably untrue in the case of third-party non-telephone charges on telecommunication billings. MR. LOHR said SB 138 was good legislation, but he was concerned with the latest amendments because they added an element of "blame the victim." If a customer has a bill of $50 for local exchange service and $25 for charges that he or she doesn't recognize, the intent is quite clear if the customer pays $50 even if there isn't a written instruction on the bill as to how to allocate the charge. MR. LOHR said he was heartened to hear that both Verizon and AT&T recognize that this was a genuine issue. He reiterated that the legislation was still vitally necessary. SENATOR WIELECHOWSKI said his office worked hard to satisfy everyone concerned and a better bill resulted. SENATOR WIELECHOWSKI moved to report CS for SB 138, version U, from committee with individual recommendations and attached fiscal note(s). CHAIR FRENCH announced that without objection CSSB 138(JUD) moved from the Senate Judiciary Standing Committee.