[Federal Register Volume 63, Number 72 (Wednesday, April 15, 1998)]
[Notices]
[Pages 18362-18363]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-10029]


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DEPARTMENT OF AGRICULTURE

Rural Utilities Service


Dissemination of Information

AGENCY: Rural Utilities Service, USDA.

ACTION: Request for public comment.

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SUMMARY: The Rural Utilities Service (RUS) seeks comments on agency 
policies for releasing and publishing information about electric and 
telecommunications borrowers. RUS makes and guarantees loans to 
electric and telecommunications systems serving rural areas. These 
loans are generally repaid over a period of 35 years and are secured by 
the borrower's assets. RUS has a responsibility to protect the security 
of multimillion dollar loans, to monitor compliance with debt 
covenants, and to ensure that loan funds are used for purposes 
authorized by law. As part of this oversight, RUS requires that 
borrowers submit certain information to RUS periodically. Currently a 
great deal of this information is easily available to the public.
    Both the electric and the telecommunications industries are moving 
from a regulated utility model to a more competitive model. In a 
regulated utility model, information about market participants is 
available to the public. In contrast, under a competitive model, a 
great deal of information is competitively sensitive. Release of this 
information could cause competitive harm to individual respondents and 
to the overall working of the market.
    RUS is seeking comments on whether the current policy of providing 
information to the public should be changed to reflect this new 
industry environment, and whether certain information should, in the 
future, be released only in an aggregated form that does not associate 
data with specific borrowers.

DATES: Written comments must be received by RUS or bear a postmark or 
equivalent not later than May 15, 1998.

ADDRESSES: Send comments to Sue Arnold, Office of the Assistant 
Administrator, Electric Program, Rural Utilities Service, United States 
Department of Agriculture, 1400 Independence Avenue, SW, Stop 1560, 
Room 4024-S, Washington, DC. 20250-1560. RUS requires, in hard copy, a 
signed original and 3 copies of all comments. Comments will be 
available for public inspection during normal business hours.

FOR FURTHER INFORMATION CONTACT: Sue Arnold, Office of the Assistant 
Administrator, Electric Program, Rural Utilities Service, United States 
Department of Agriculture, 1400 Independence Avenue, SW, Stop 1560, 
Room 4024-S, Washington, DC. 20250-1560. Phone: 202-690-1078. Fax: 202-
690-0717. E-mail: [email protected].

SUPPLEMENTARY INFORMATION: The Rural Utilities Service (RUS) makes and 
guarantees loans to electric and telecommunications systems serving 
rural areas pursuant to the Rural Electrification Act of 1936, as 
amended, (7 U.S.C. 901 et seq.) (RE Act). Most loans are repaid over a 
period of 35 years and are secured by the borrower's assets. As a 
creditor, RUS has a fiduciary responsibility to protect the security of 
multimillion dollar loans, to monitor compliance with debt covenants, 
and to ensure that loan funds are used for purposes authorized by law. 
As part of this oversight, RUS requires that borrowers submit certain 
information to RUS. This information includes Financial and Statistical 
Reports. Electric distribution borrowers submit this information in RUS 
Form 7. Power supply borrowers, also known as ``generation and 
transmission borrowers'' or ``G&T's,'' submit RUS Form 12. 
Telecommunications borrowers report this information on RUS Form 479.
    The environment of both the electric and telecommunications 
industries is in a state of flux. Until very recently, most Americans 
received virtually all electricity and most telecommunications services 
from utilities that are regulated monopolies. Both industries are 
rapidly moving away from the regulated monopoly

[[Page 18363]]

model toward a more competitive model that relies heavily on market 
forces.
    The electric industry is now characterized by a mix of utilities 
and nonutilities, and the distinction between activities performed by 
utilities and activities performed by nonutilities is becoming 
increasingly blurred. Both utilities and nonutilities, for example, 
generate electric power, and nonutility power marketers, brokers, 
aggregators, and similar entities now compete directly in business 
activities that were once the exclusive domain of utilities. In fact, 
electric power may pass through multiple utility and nonutility 
entities before reaching ultimate consumers.
    The telecommunications industry is in the midst of the deregulation 
brought about by the Telecommunications Act of 1996 (1996 Act). The 
service now being deregulated is local telephone service--long distance 
service was deregulated in the early 1980's. Prior to the 1996 Act, 
most customers bought local service from a provider that was a utility 
with an exclusive franchise to serve an area. Today the Federal 
Communications Commission is implementing the 1996 Act by opening local 
markets to competition. The distinction between providers of long 
distance and local telephone services is evaporating, and cable TV 
companies, internet providers, and others are beginning to explore 
entering markets that were once the exclusive domain of a traditional 
telephone company.
    In a regulated monopoly model, a great deal of information about 
utilities is traditionally available to the public. In a competitive 
environment, in contrast, a great deal of information about market 
participants could be competitively sensitive. Release of this 
information could cause substantial competitive harm and impede the 
workings of a free market.
    RUS borrowers are utilities, and RUS currently releases data about 
individual borrowers on a routine basis. For example, the Statistical 
Report, Electric Borrowers (RUS Information Publication 201-1) is RUS's 
annual compilation of data submitted by electric borrowers on RUS Forms 
7 and 12. Information about telecommunications borrowers based on RUS 
Form 479 is compiled in the Statistical Report, Rural 
Telecommunications Borrowers (RUS Informational Publication 300-4). 
These reports may be purchased at nominal cost from the U.S. Government 
Printing Office (GPO). On the other hand, comparable information about 
nonutilities that compete, or may wish to compete, against RUS 
borrowers is not easily available.
    Because of the changes in the electric and telecommunications 
industries, and the current imbalance of information available about 
different industry participants, RUS is seeking public comments to help 
determine whether some information now routinely published should, in 
the future, be treated with more confidentiality.
    Specifically, RUS requests comments on the following:
    1. Should RUS change its current practice of making borrower 
specific information available in the annual RUS Statistical Reports, 
and in responses to specific requests from individuals?
    2. How do various members of the public use information about 
specific borrowers that RUS now makes available on a routine basis?
    3. Specifically, what information, if any, should be withheld from 
publication by RUS, and released only in an aggregated form that does 
not allow information to be matched with specific borrowers? RUS 
requests that respondents discuss the exact types of information that 
they believe could be harmful if released.
    4. What information should RUS continue to release and/or publish 
at the borrower level, and why is release or publication of this 
information in the public interest?
    5. How could release of certain business data relating to borrowers 
cause harm to RUS borrowers, RUS as a secured creditor, rural 
consumers, and/or the RUS goal of ensuring that rural consumers 
continue to have access to high quality, reliable electric and 
telecommunications service at reasonable cost?

    Dated: April 9, 1998.
Christopher A. McLean,
Acting Administrator, Rural Utilities Service.
[FR Doc. 98-10029 Filed 4-14-98; 8:45 am]
BILLING CODE 3410-15-P