The West Virginia Public Service Commission (West Virginia PSC) has granted release of $29.1 million to Frontier Communications (NASDAQ: FTR) from two separate escrow accounts.
Frontier asked for the release from the West Virginia PSC for $23.7 million from a service quality escrow account and another $5.4 million from a broadband escrow account, said Dana Waldo, senior vice president and general manager. The PSC granted Frontier’s requests in full.
The West Virginia PSC established the two escrow accounts in 2010 as part of Frontier’s acquisition of Verizon markets in West Virginia. Verizon funded a service quality account at $72.4 million. Frontier pledged $48 million toward broadband deployment in a separate account. The Commission has discretion on whether to reimburse Frontier from those accounts.
“Frontier has worked diligently to strengthen our networks and provide our customers with the best possible communications services,” Waldo said. “At the same time, we have extended our broadband network in the West Virginia markets we acquired from Verizon in 2010 from 62 percent of the households to more than 83 percent.“We appreciate that the Commission, following its ongoing review of our performance, granted us the full amount of the escrowed funds we requested,” said Waldo, who noted the money reimburses Frontier for investments it already has made in its network. Waldo said Frontier’s investments in the networks have paid dividends. “As a result of Frontier’s continued investments, the telecommunications network in West Virginia is in much better condition to withstand the effects of natural disasters, such as this summer’s storms and last week’s snowstorm,” Waldo said. “Including the unprecedented impact of these storms, total network troubles for the past 12 months are 22 percent lower than during the year before Frontier acquired the West Virginia service area.” In its filing, the PSC noted that it is satisfied with the current pace of service quality improvement and that its staff had reported improvements in Frontier’s service quality measurements.