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DUFF & PHELPS CREDIT RATING CO. REAFFIRMS THE RATINGS OF PACIFIC BELL

 CHICAGO, Oct. 8 /PRNewswire/ -- Duff & Phelps Credit Rating Co. has reaffirmed the ratings of Pacific Bell's notes and debentures at `AA' (Double-A) and the ratings of the company's commercial paper at Duff 1+. The `AA' (Double-A) rating applies to the $550 million senior unsecured debentures issued Oct. 5, 1993.
 On Oct. 6, the California Public Utilities Commission (CPUC) rescinded its decision to allow local toll competition and to realign rates for local toll and basic service. The commission action was taken as a result of allegations of improper contact between members of the CPUC staff and Pacific Bell employees. Several Pacific Bell employees provided technical assistance in the proceeding leading to the Oct. 6 order. These employees were operating at the specific request of the CPUC, under the supervision of the CPUC, and were subject to non- disclosure agreements prohibiting any communication of the CPUC proceeding to any party. The CPUC has rescinded the original order and undertaken an investigation of this matter in an effort to avoid the appearance of any impropriety in reaching that decision. Effective immediately, ex parte communications between parties and decision makers in this proceeding will be strictly prohibited.
 The CPUC indicated that the investigation will delay implementation of local toll competition and the accompanying rate changes until several months into 1994. However, the CPUC indicated that it plans to "continue the overall policy direction and framework outlined" in the original decision, including the authorization of toll competition and a major restructuring of toll and basic service rates. As a result, it appears likely that the final commission order will follow the broad outlines of the original decision.
 Pacific Bell is the second largest local telecommunications company in the United States serving 14.4 million lines in California. Roughly 35 percent of the access lines are in Los Angeles and vicinity, and another 25 percent of lines are in San Francisco and surrounding areas.
 -0- 10/8/93
 /CONTACT: James J. Stork, CFA, of Duff & Phelps Credit Rating Co., 312-368-3125/


CO: Pacific Bell ST: California IN: UTI SU: RTG

MP -- NY037 -- 0176 10/08/93 13:09 EDT
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Publication:PR Newswire
Date:Oct 8, 1993
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