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Report: Verizon's tax savings could fund universal access in northern New England

As we've shown before, the proposed sale of Verizon's 1.3 million landlines in northern New England to FairPoint Communications would hurt the region's consumers, workers, and local communities.

Verizon, on the other hand, would make out like a bandit.

The deal, which takes advantage of an arcane tax loophole, would net Verizon $600 million in tax savings, because it's selling its infrastructure to a small firm, FairPoint, instead of a larger, more stable company. While Verizon pockets $600 million, northern New England residents would be stuck with FairPoint, a company with loads of debt and limited resources to expand high speed Internet service.

Now, CWA and the International Brotherhood of Electrical Workers have released a report that shows the $600 million in tax savings Verizon would receive is enough to expand high speed Internet access to everyone in Verizon's current Maine, New Hampshire, and Vermont service areas. If properly invested, those funds could:

  • Providing lightening-fast fiber optic service (such as Verizon's FiOS Internet) to 84 percent or 857,000 of the residential customers served by Verizon in the three states;
  • Or, providing access to DSL high-speed service to nearly 100 percent of homes and FiOS to 75 percent of customers in the three states.

Instead, Verizon would add those funds to its already huge profits. That's especially outrageous, considering New Hampshire is last, Vermont is next to last and Maine is fourth from bottom of the 50 states in the percentage of homes with DSL access. Only 64 percent of households in those three states have access to high speed Internet, compared to the national average of 79 percent.

As the report's author, CWA economist Kenneth Peres said,

"If this deal is approved as currently structured, U.S. taxpayers will be subsidizing Verizon for abandoning its operations in northern New England and leaving these states as a communications backwater for years to come."

Residents of these states have made it clear they oppose the Verizon-FairPoint deal at rallies in northern New England and at Verizon's New York headquarters.

The people of Maine, New Hampshire, and Vermont have spoken. Now they must continue to speak out to stop Verizon from leaving them behind.

The Point? It's Not Fair (Speed Matters)

The Proposed FairPoint Purchase of Verizon's Properties Would Place Consumers, Workers, and Communities at Risk (Speed Matters)

Shedding more light on Verizon's unfair FairPoint deal (Speed Matters)

Morgan Stanley issues warning about FairPoint (Speed Matters)

Verizon's Savings From Tax Loophole in FairPoint Deal Would Fund High-Speed Internet in Northern New England

"Road kill on the information superhighway" (Speed Matters)

Opponents of FairPoint sale hold huge rally at Verizon HQ (Speed Matters)

Access for everyone (Stowe Reporter)