Telecom News - Union Campaign Improves Verizon-FairPoint Deal

Final approval by the New Hampshire Public Utilities Commission in February permits the sale of Verizon Communications operations in northern New England to FairPoint Communications to go forward — but the campaign waged by CWA, the IBEW and political allies throughout the three states resulted in real improvements in the final deal that will help support quality service.

"One clear result of the effort by union members, concerned elected officials, community and consumer groups, and thousands of residents and activists in Vermont, New Hampshire and Maine is that an additional $970 million — the sum of Verizon's contributions of $362 million and FairPoint's commitments of $610 million as required by regulators as a condition of the sale — will help make FairPoint a stronger operation," said CWA President Larry Cohen. This includes a requirement that FairPoint cut its dividends by at least $200 million in order to reduce its debt.

Even with this added financial support, "CWA continues to believe that northern New England would have been better served by the establishment of an independent company, one that would operate without the huge debt load that burdens FairPoint, or by the sale of Verizon lines to an established company that would be capable of bringing true high speed broadband to the region.  As it stands, the benefits of true high speed Internet networks — the economic engine of the 21st century — simply won't be available to many businesses and consumers in this region," said Cohen.

State regulators and the public must make certain that FairPoint meets all of its commitments, he said. The New Hampshire Public Utilities Commission also recognized that FairPoint should meet its health care and other obligations to retirees by requiring FairPoint to establish an external trust fund to help cover its liabilities.

CWA and IBEW researchers and expert consultants testified at hearings in the three states, urging that the deal be rejected because of FairPoint's weak financial position and uncertainty over its ability to invest in quality services and good jobs in the region.  The unions took their message to the public through radio and print ads, membership rallies, postcard drives and online petitions to governors and lawmakers.

About 2,500 workers, members of CWA and the IBEW, now will make a transition to employment by FairPoint, and negotiations are underway.