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As Democrats criticize, Pawlenty reveals additional telecom work
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House DFLers say Gov. Tim Pawlenty has a history of favoring corporate telecommunications interests over those of the consumer. House DFL Minority Leader Matt Entenza of St. Paul says when Pawlenty served in the Legislature he routinely voted against consumer protection legislation. (MPR Photo/Michael Khoo)
Gov. Tim Pawlenty has acknowledged deeper ties to a Republican businessman who oversaw several telecommunications firms, one of which has been charged with defrauding customers in at least seven states. Pawlenty made his comments during a two-hour press conference on Tuesday that was meant to clarify Pawlenty's role in the controversy, which he maintains was minimal. At the same time, House Democrats say the governor's voting record as a state representative favored phone companies over consumers.

St. Paul, Minn. — While he campaigned for governor, Pawlenty now says he worked as an independent consultant for a pay-phone company called Access Anywhere. A principal in that company is Elam Baer, a long-time GOP activist, Pawlenty friend, and chair of the board at New Access Communications. New Access, in turn, is charged with defrauding consumers in seven states by signing them up for local and long-distance phone service without permission.

Pawlenty says he was paid $4,500 a month over the course of his year-long run for governor. He could not quantify the amount of work he performed. But Pawlenty says it's no surprise Baer would help him find work.

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Image Gov. Pawlenty

"Is Elam a friend and in various ways try to help me? Yeah, yes, of course. But that's not a news flash," Pawlenty said.

Pawlenty also served with Baer on the board of NewTel, the parent company for New Access. He left that job in 2001.

DFL House Minority Leader Matt Entenza underlined the governor's ties to the telecommunications industry and says Pawlenty voted frequently in favor of phone companies and against consumer interests. But Pawlenty says his full voting record shows otherwise.

"Minnesota has on the books a good anti-slamming law. It passed in 1998, and I voted for it. That speaks very directly and precisely to the issue of slamming and anti-slamming protections in Minnesota," the governor said.

Pawlenty also claims credit for helping to enact that state do-not-call phone list in 2002. Entenza's critique focused particularly on a measure that would prevent phone companies from selling data on the calls their customers make. New Access has not been charged with doing so. But Entenza says the larger issue is not the specifics of the law, but what he calls a general Republican indifference towards consumers.

"There is a pattern of Republican leadership refusing to help consumers and instead working to help their friends and their investment interests," Entenza charged.

Entenza also called on Pawlenty to pressure his former business associates to release the minutes of their board meetings. Entenza says that could clarify the governor's claim that he was unaware of consumer complaints plaguing his subsidiary company.

Company officials have declined to release the minutes, citing business privacy concerns. However, the governor did release a memo from the parent company's outside counsel affirming that the minutes show the regulatory issues were not discussed the meetings Pawlenty attended.

Company officials don't deny the company has run afoul of regulators. But New Access co-founder Steven Clay says there was no intention to willfully defraud customers. Clay says the company was operating in uncharted territory following the federal deregulation of the telecommunications industry.

"Where we have made mistakes, we do not think they are unusual for the industry. We think they have been caused by really very rapid growth on our part as a start-up company in a brand new industry. And we believe we have corrected those mistakes, made customers whole where necessary, and moved on," he said.

But state regulators outside of Minnesota paint a different picture. Vicki Elliot is the assistant director for consumer affairs at the Washington State Utilities and Transportation Commission. Last year, the UTC settled with New Access for more than $70,000 in fines and investigation costs. Elliot says it's common for new entrants to the market to experience a certain level of complaints while they work out kinks in their business plans. But she says the level of customer dissatisfaction with New Access was unheard of.

"What made this company different, however, was the scope of the complaints and the nature of the complaints. This company was slamming customers. In other words, it was transferring customers from other companies to it without the appropriate authorization. And that's very serious," she said.

Elliot says that New Access continues to operate in Washington and, since the settlement, has received no unusual complaints.

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