State reviews bids to privatize telecommunications

Posted: Wednesday, January 31, 2001

JUNEAU (AP) -- Alaska could soon become the first state in the nation to contract with the private sector for all of its telecommunications services.

Three would-be telecommunications providers have responded to the state's request for proposals, and Alaska Department of Administration.

The names of the applicants are confidential under state procurement law.

State government spends about $26 million a year on telephone, videoconference, pager, mobile radio, Internet and other telecommunications services, said Administration Commissioner Jim Duncan.

More than $20 million of that is contracted to numerous providers in a piecemeal fashion, Duncan said.

''There's always been concern expressed that perhaps we could be doing it more efficiently and more effectively,'' Duncan said.

But its not certain that any of the bidders will be found responsive to the states request for proposals, Duncan said.

''This is not a must-do thing,'' Duncan said. ''We could very well determine that we're better off ... providing services as we presently are.''

The target date for awarding a contract is March 15. The contract would be for about $100 million over four years, with options for two one-year extensions.

Duncan acknowledged concern that completely privatizing telecommunications could put the state at a disadvantage when negotiations over contract renewal take place with the new single provider.

But the state will retain ownership of some critical infrastructure, such as its microwave system linking Fairbanks and Anchorage, he said.

Meanwhile, the state has bought union peace through employment guarantees. In a letter of agreement signed last fall with two unions, Public Employees Local 71 and the Alaska State Employees Association, 42 workers who would be affected are promised they will not be laid off.

Under the agreement, which was made a condition of the pending telecommunications contract, the union members could remain state employees at current pay and benefits but work at the direction of the contractor. They also could ask for reassignment within state government or go to work for the contractor and surrender their rights as state employees.

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