AT&T; Files to Re-Enter Local Phone Business : Telecom: The company submits applications to provide such service in Illinois and Michigan.

AT&T; is taking its first steps to get back into the local telephone business-- something it hasn’t done in 11 years.

The nation’s largest long-distance company filed applications Wednesday to provide local phone service in Illinois and Michigan. A landmark agreement last month among the Justice Department, local phone company Ameritech and AT&T; paved the way for AT&T; to provide such service in Chicago and Grand Rapids.

Under the agreement, Ameritech, which provides local phone service to those areas, would be allowed to provide long-distance service to those cities as well.

However, a consent decree that broke up AT&T; in 1984 forbids Ameritech and other Bell regional companies from providing long-distance service. Therefore, U.S. District Judge Harold Greene, who administers the decree, must give his approval before Ameritech can provide such service.

The consent decree does not bar AT&T; from providing local phone service. But with the breakup, AT&T; got out and stayed out of the local phone business.

The Justice Department agreement stipulates that Ameritech must comply with certain conditions aimed at creating a climate under which local phone competition can flourish.

Jim McGann, an AT&T; spokesman, said the company plans to resell telecommunications service to businesses and residents. It will buy service from Ameritech, GTE Corp. and Centel Corp.

McGann said Wednesday’s announcement doesn’t signify a broad drive by AT&T; to enter the local telephone market. Both MCI Communications Corp. and Sprint Corp. offer local service.

“If the right conditions were in place, we would consider offering local service in other parts of the country,” McGann said.

AT&T;’s foray into the local telephone business comes as other long-distance and local phone companies try to invade each other’s traditional domains.

It also comes as Congress is considering the first major rewrite of telecommunications laws in 61 years.

Legislation in both chambers would let local, long-distance and cable companies into one another’s businesses. If enacted, the legislation would supersede the Justice Department agreement.