Senate rejects SBC bill to wring cash from competitors

May 9, 2003 © Chicago Sun Times

BY DAVE MCKINNEY AND CHRIS WETTERICH Staff Reporters

SPRINGFIELD--In a stinging blow to SBC Communications, the Illinois Senate on Thursday narrowly rejected the company's bid for an economic leg up on its competitors amid criticism the firm's plan would provoke higher telephone rates.

With labor unions behind it, SBC had engaged in a furious lobbying pitch for legislation to allow it to charge competitors like AT&T and MCI more money to use its lines for local phone service.

But after muscling its plan through the House on Wednesday, SBC hit a brick wall in the Senate a day later after Republicans and a handful of Democrats sided with critics, who called the bill anti-consumer. The measure got 27 of the 30 votes needed for passage, while 26 senators opposed it.

"I thought we had the votes," said the bill's sponsor, Sen. James Clayborne (D-Belleville), who used a parliamentary maneuver to keep the bill alive for a possible vote later this month.

For months, the state's television airwaves and newspapers have been filled with negative ads from SBC and its rivals in a bid to sway the General Assembly on a highly technical and perplexing bill.

"If we're confused, what do you think about our constituents, who have to watch ad after ad after ad?" asked Sen. Debbie Halvorson (D-Crete), who supported the measure. "It's like being in a campaign all over again, and you know no one is telling the truth."

The legislation sought by SBC but opposed by the pro-consumer Citizens Utility Board would have increased the cost to competitors for using SBC's statewide telephone network.

The company wanted that legislation because it claimed a state law deregulating the telephone industry has forced SBC to sell the use of its network below its costs, allowing rivals to run up double-digit profits at SBC's expense. However, SBC's competitors contended the bill would stamp out competition and raise consumer phone rates.

Even though unions like the Illinois AFL-CIO and Chicago Federation of Labor backed the bill, saying it would preserve SBC's 21,000 Illinois jobs and help create new ones, a half-dozen crucial Demo-crats were not swayed.

"What this does is try to return the state of Illinois to a monopoly when it comes to phone service," said Sen. Patrick Welch (D-Peru), who voted against the plan.

Republicans railed they were not being given enough time to examine details of the package and had been limited by Democratic proponents in questioning SBC executives.

"I was allowed to ask the president of SBC one question. That's not how this process should work," said Sen. Dave Sullivan (R-Park Ridge), who voted no.

Andrea Brands, director of communications for SBC Illinois, said the company was disappointed by Thursday night's vote and was attempting to regroup.

SBC had amassed an armada of political clout, beginning with its president, William Daley, brother of Mayor Daley. The firm also had hired more than four dozen lobbyists from all political persuasions, including several ex-legislators and former senior legislative staffers.

Contributing: Chris Fusco