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HomeNewsArchivesPSC Accepts Examiner's Recommendation to Not Change Vitelco Rates

PSC Accepts Examiner's Recommendation to Not Change Vitelco Rates

Dec. 9, 2008 — The Virgin Islands Public Services Commission Monday night voted to accept the recommendations of hearing examiner David Nissman made in a report scathingly critical of the former management of Vitelco, the V.I.'s only local telephone company. The publicly regulated utility is set to be auctioned to the highest bidder Dec. 17 as part of a massive bankruptcy case involving Vitelco's parent, Innovative Communications Co. and its former owner, Jeffrey Prosser.
PSC members Monday ordered that the telephone company's rates remain the same, paving the way for the sale of the company, according to the V.I. Daily News
Vitelco, which was renamed Innovative Telephone after Prosser merged his various holdings in the territory, is one of the many assets on the auction block to help pay close to $1 billion in debt that Prosser owes to a variety of creditors.
Nissman, former U.S. attorney for the Virgin Islands, was hired by the PSC to oversee the rate investigation and present his recommendations to the commission.
While the decision to maintain rates at their current level provides a secure basis from which potential buyers can make their bids for the company, Nissman's report went far beyond a recommendation on the rates. He told commissioners Monday that much of the company's network is outdated and will have to be replaced. Maintenance has been so poor, he said, that parts are held together "with Scotch tape and baling wire," the Daily News reported.
"The network must be replaced," he said.
Whoever buys the system will have to be prepared to spend about $100 million to bring the system up to date and provide the service and reliability that customers have a right to expect. Otherwise the company is likely to continue to lose customers to competing high-tech communication services. He provided a list of other recommendations for improving service, including investing in customer service training, holding annual customer service meetings, and submitting monthly service reports to the PSC.
"The present rate review is handicapped by the pending sale of Vitelco, the bankruptcy of the parent entities, lack of planning and investment by the prior management, and the uncertainty surrounding the future capital structure of the corporation," Nissman's report says.
Commission members in attendance were chairman Joseph Boschulte, Verne David, M. Thomas Jackson, Donald Cole and Alecia Wells.

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Dec. 9, 2008 -- The Virgin Islands Public Services Commission Monday night voted to accept the recommendations of hearing examiner David Nissman made in a report scathingly critical of the former management of Vitelco, the V.I.'s only local telephone company. The publicly regulated utility is set to be auctioned to the highest bidder Dec. 17 as part of a massive bankruptcy case involving Vitelco's parent, Innovative Communications Co. and its former owner, Jeffrey Prosser.
PSC members Monday ordered that the telephone company's rates remain the same, paving the way for the sale of the company, according to the V.I. Daily News
Vitelco, which was renamed Innovative Telephone after Prosser merged his various holdings in the territory, is one of the many assets on the auction block to help pay close to $1 billion in debt that Prosser owes to a variety of creditors.
Nissman, former U.S. attorney for the Virgin Islands, was hired by the PSC to oversee the rate investigation and present his recommendations to the commission.
While the decision to maintain rates at their current level provides a secure basis from which potential buyers can make their bids for the company, Nissman's report went far beyond a recommendation on the rates. He told commissioners Monday that much of the company's network is outdated and will have to be replaced. Maintenance has been so poor, he said, that parts are held together "with Scotch tape and baling wire," the Daily News reported.
"The network must be replaced," he said.
Whoever buys the system will have to be prepared to spend about $100 million to bring the system up to date and provide the service and reliability that customers have a right to expect. Otherwise the company is likely to continue to lose customers to competing high-tech communication services. He provided a list of other recommendations for improving service, including investing in customer service training, holding annual customer service meetings, and submitting monthly service reports to the PSC.
"The present rate review is handicapped by the pending sale of Vitelco, the bankruptcy of the parent entities, lack of planning and investment by the prior management, and the uncertainty surrounding the future capital structure of the corporation," Nissman's report says.
Commission members in attendance were chairman Joseph Boschulte, Verne David, M. Thomas Jackson, Donald Cole and Alecia Wells.

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Share your reaction to this news with other Source readers. Please include headline, your name and city and state/country or island where you reside.