Two papers consider state regulation of the telecommunications industry. The first paper, "Managing the Mixed Bag: Incentive Regulation at the State Level" (Gail Garfield Schwartz, Deputy Chairman, New York State Public Service Commission), describes New York State's regulatory policies in the broader context of the best ways for state regulators to address the problems caused by a growing and changing, yet still basically monopolistic telecommunications industry. It is noted that in New York, rate stability plans are in place which encourage the cutting of operating costs through higher rates of return. The second paper, "The Information Age--Leader or Follower" (Bailey M. Geeslin) (abstract only) argues that the traditional base rate of return regulation is not compatible with the enormous changes which have occurred recently in the telecommunications sector, including technological advances, significant governmental decisions, and competition in the industry. Changes in the regulatory structure are recommended to keep this nation from becoming a second-rate information based society. (Author/EW)