Both the Advertiser and the Advocate have pieces up on the City/LUS loss in the court of appeals on the issue of cross subsidization.
From the Advocate:
The 3rd Circuit Court of Appeal in Lake Charles issued a ruling Thursday morning that blocks the Lafayette Utilities System from issuing bonds to build its planned telecommunications business.
The point:
Lafayette officials have said, that without the payback mechanism used in the bonds ordinance, interest rates on the bonds would likely be higher, which will affect the cost of running the communications system.
That’s the point. BellSouth wants to raise the cost to the consumer of LUS’s services. This has the effect of forcing LUS to make a profit enough in years when it is building the system to pay back the costs of a long term loan intended to build out the whole city. That is absurd. That is why you borrow money–so that you can purchase the tools to make money in the long run. If ANY “private” business were so limited they’d never get started and BellSouth could never have “cross-subsidized” its portion of Cingular with money Louisiana rate-payers sent it.
This could NOT have been what the legislature meant for it makes a mockery of allowing the city a half-rational plan. The legislators and officials who attended the meetings have openly said that this was not what they were talking about.
BellSouth is acting in Bad Faith. (Note that Cox has not joined them.)
Write your legislators. Ask your friends to. Repeal of the law which allows BellSouth to misuse the courts to betray their word is the proper solution.
Let’s get working on it. Have an idea? Wanna join in on good ideas from others? Write: standingup@lafayetteprofiber.com
Would you like to read the decision yourself? You can, courtesy of the internet and PDF: http://www.la3circuit.org/opinions/2006/01/010506/05-1478-1505opi.pdf I’ll be interested in reader insights.
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