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By TUX TURKEL, Staff Writer Wednesday, March 21, 2007

The company trying to buy Verizon's phone network in New England promised Tuesday not to cut workers or benefits if the sale wins regulatory approval and called for a meeting to discuss its commitments with labor leaders who oppose the deal.

FairPoint Communications has been working through Gov. John Baldacci's office to set up direct talks with union officials in Maine, according to Walter Leach, executive vice president for corporate development. The company hopes a meeting will take place sometime during the next several weeks, he said.

But Peter McLaughlin, business manager for Local 2327 of the International Brotherhood of Electrical Workers, said labor officials first want FairPoint to provide specific information about its plans to manage and expand Verizon's network. Without that, he said, meetings have little value.

FairPoint's attempt to reach out to labor leaders is part of its strategy to win approval of the $2.7 billion sale from utility regulators in Maine, New Hampshire and Vermont.

The IBEW and the Communication Workers of America have emerged as vocal, highly organized opponents. Through public protests and other means, they've sought to portray FairPoint as underfunded and poorly suited to operate the largest landline network in northern New England. Their goal is to cast the company in a bad light at regulatory hearings later this year.

But FairPoint also is reaching out to the public, this week to business and community leaders in Maine. Leach made FairPoint's case Tuesday to more than 40 decision makers who attended a breakfast presentation organized by the company in Portland. Similar sessions are being held in Saco, Lewiston-Auburn and Bangor.

These meetings aren't going unchallenged by the unions. A handful of protesters in Portland carried signs reading, "Say no deal to FairPoint," and "No fiber, no future." They distributed brochures critical of the sale to participants leaving the breakfast.

Verizon is the dominant phone company in the region, and the proposed sale of 1.6 million local access lines to FairPoint is significant.

Critics charge that Verizon hasn't done enough to expand broadband Internet service by failing to install fiber-optic cables and that this inaction hurts economic growth in rural areas. FairPoint has pledged to accomplish the goal with high-speed DSL service over phone lines, although the unions charge that this technology is too slow.

The Maine Public Utilities Commission will have to determine whether Charlotte, N.C.-based FairPoint, which provides some local phone service in central Maine, has the commitment and financial ability to follow through statewide.

Leach told business leaders Tuesday that it does and that it needs Verizon's unionize workers to be successful. Verizon has roughly 3,000 workers in northern New England, 1,200 of them in Maine.

At Baldacci's urging, Leach has been publicly stating that FairPoint won't cut the number of workers and will continue to fully fund pensions. He said the company also is willing to discuss extending union contracts that were negotiated with Verizon and expire in 2008.

FairPoint also plans to hire an addition 600 workers in the three states to handle tasks now performed elsewhere by Verizon. Some of these will be union-covered position, Leach said.

Labor leaders need to hear the specifics of these promises directly from FairPoint executives, according to Jack Cashman, an economic development advisor in the governor's office. Although labor matters are a side issue for utility regulators, he said, Baldacci has signaled that he wants the parties to work out their differences.

"We've encouraged both sides to sit down," he said.

But McLaughlin at the IBEW said he attended a meeting last month in Vermont, at the urging of Sen. Bernard Sanders, I-Vt. Among labor's biggest concerns, McLaughlin said, is the debt FairPoint will assume in the purchase and its ability to grow revenue with landline service, which is shrinking in the face of competition from wireless and cable options. Both McLaughlin and Steve Early, a spokesman for the communication workers, said the meeting in Vermont left them skeptical of FairPoint's ability to honor its promises.

"They didn't have answers for us then," McLaughlin said.

McLaughlin kept the door open to direct talks in Maine but said he wanted some assurance that FairPoint would be more specific about its plans.

In his Portland presentation, Leach painted the picture of a phone company that will be strong on customer service and focused on northern New England. It will aggressively expand broadband Internet access, he said, well beyond Verizon's current penetration of 62 percent, and closer to 90 percent.

Leach also said the cost of labor agreements, building new service centers in the region, expanding broadband and favorable tax treatment were factored in to the sale price. And he predicted the sale would win approval by utility regulators in the three states by year's end.

Unions, however, organized under the www.stop-the-sale.org Web site, continue to question how the deal will affect workers if the company finds itself unable to meet its financial obligations.