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CWA, Allies in Congress Set Battlelines Against Verizon-Frontier Deal

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January 7, 2010

Verizon-Frontier DealCWA joined members of Congress and other allies today in a media teleconference to outline concerns about the proposed Verizon-Frontier merger and discuss ways to eliminate a tax loophole that allows Verizon and other companies to sell assets tax-free to smaller companies that end up burdened by debt. 

CWA has been fighting to block the sale of 4.8 million Verizon landlines in 14 states to Frontier. The sale would mean a $600 million tax savings for Verizon and $3.3 billion in new debt for Frontier, making it very unlikely that Frontier could build out high speed broadband or provide other advance telecommunications services to consumers.  

In West Virginia, CWAers and District 2 have been mobilizing against the sale and will hold a mass rally on Jan. 10 in Charleston, just before the start of the state's Public Service Commission hearings.

On the teleconference, Rep. Paul Hodes (D-N.H.) outlined his bill to close the "Reverse Morris Trust" tax loophole that permits these deals. The bill will be introduced by Hodes and co-sponsor Rep. Louise Slaughter (D-N.Y.) later this month.

Joining the call: CWA President Larry Cohen, IBEW President Edwin Hill, Rep. Allan Mollohan (D-W.Va.) and Ben Scott of Free Press.

Less than three years after Verizon's sale of its New England landlines to FairPoint Communications, that company has filed for bankruptcy. Now, workers face cutbacks and job losses, customers face deteriorating service and the lack of high speed broadband and other new technologies. Hawaiian Telecom also filed for bankruptcy after Verizon used the same tax loophole to dump its landlines in Hawaii.

For more information, visit www.bad4wv.com.