WASHINGTON-The Senate has inserted state preemption language in its draft of telecommunications legislation that could give wireless carriers a national reprieve from encroaching state regulations, but stiff opposition already is brewing.
The Senate Committee on Commerce, Science and Transportation circulated a new draft of its telecommunications bill late last Friday that contained provisions that would prevent state and local governments from regulating "rates charged by any provider of commercial mobile service for any such mobile service or any or any [sic] other service." The bill essentially provides cover for wireless carriers against state intervention in rate regulation, including possibly some borderline issues such as termination fees and other issues, say some observers.

The legislation is still working its way through the Senate. It faces review by the full Senate Commerce Committee on Thursday, as well as a future review by the Senate Judiciary Committee.

The insertion of the language is a victory for the wireless industry, as the state preemption issue has taken a back seat to broadband and cable issues in the emerging telecom legislation now being assembled on Capitol Hill.

Legislation on the House of Representatives side passed without including a provision for federal preemption for wireless rate regulation. Its inclusion in the Senate bill, sponsored by Senate Commerce Committee Chairman Sen. Ted Stevens, R-Alaska, is subject to a committee markup meeting on Thursday. 

Consumer groups and state regulators were forming significant opposition to the changes today.

State regulators said they are concerned about the additions and are gearing up to fight them. "These changes increase the likelihood the bill won't pass," says Brad Ramsay, general counsel for the National Association of Regulatory Utility Commissioners (NARUC). Ramsay says his organization sees this as a consumer issue because consumer complaints about wireless service are still coming in to state utility commissions, which have to respond to them. The move to exclude states from regulating some aspects of wireless services could be seen as "anti-consumer" as fall elections near.

Powerful AARP, the group representing older Americans, also voiced its concerns about the language. "Since the 1993 law that gave states and federal regulators joint jurisdiction over wireless services, the wireless industry has thrived" under the current regulatory model, says Debra Berlyn, senior legislative representative with AARP's federal affairs department. "Consumers can't afford to lose" state regulators' oversight of some wireless issues, she adds.

CTIA has been diligently working behind the scenes to get the language included. The organization's president and CEO, Steve Largent, had been criticized by some in the industry for not getting preemption language included in the bills. Broadband, cable and network neutrality issues have dominated the bill, as cable companies, wireline phone companies and broadband service providers muscle each other for advantage.