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Loretel Systems sold to Arvig, two other phone companies

Months ago, people in Frazee petitioned for the ability to call three surrounding areas toll free.

While that process continues, Loretel System's mother company, Hector Communications Corp., is going through a process of its own.

A communications group has bought Hector Communications for nearly $145 million. The three companies making the purchase are Arvig Enterprises Inc., Blue Earth Valley Communications Inc. and New Ulm Telecom Inc.

Hector Communications Operations Manager Matt Sparks said the buyout won't affect the company. He said costs and services will all be the same.

One cost that is changing, though, is rates for Loretel customers. Residential and business bills are increasing $3 per month. Sparks said it didn't have anything to do with the buyout, but rather is due to operation costs. This is the first increase since at least 1983, he said.

As for the Frazee to Detroit Lakes no-long-distance change progress, Sparks said it's out of the company's hands at this point and in the Public Service Commission's.

Loretel customers in the 334 exchange area petitioned to have no long distance charges for calls to Detroit Lakes, Perham and Vergas. Detroit Lakes is the only exchanged that passed the process.

Hector Communications conducted a traffic study, concluding that at least 50 percent of those within the 334 exchange called the Detroit Lakes area three times a week.

After the Public Service Commission determines a rate, it will go to vote of 334 customers, likely this fall. Ten years ago, the increase was estimated at $2.70. Sparks said he has no idea what the increase will be now.

To be approved, at least 51 percent of the customers must vote in favor of the extended area of service.

Sparks said if it passes, the traffic between the two exchanges will increase for a period of time because everyone feels it is free, then the traffic will fall back to where it normally is.

While 334 customers will pick up a majority of the cost increase, there is "typically something in there" for Detroit Lakes customers to pay as well.

"The cost is spread so much it's pennies, or it may be nothing," he said.