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Proposed FCC Rule Would Drastically Reduce Fair Compensation Cable Companies Pay Cities for Use of the Public Right-of-Way

Nov. 14 is Deadline to Submit Opposition

November 1, 2018
The Federal Communications Commission (FCC) is considering adopting policy that would allow cable companies to deduct the fair market value from the cable franchise fees obligations to cities for a wide range of public benefits. 
 
These include public, educational and government (PEG) channel capacity and transmission. The League has submitted an opposition letter and cities are urged to also send the FCC an opposition letter by Nov. 14.
 
Background
 
Under current law, cable companies often pay franchise fees in exchange for use of the public right-of-way and provide PEG channel capacity and transmission in cities or counties where they operate. Cities use these fees for key local services and PEG channels for the public to stay informed with locally beneficial information, including televised government meetings, televised school activities or educational instruction, and televised programming led by a variety of individuals or organizations within the community. By allowing cable companies to deduct the fair market value of such services from their franchise fee obligation, this proposal would undermine the access and availability of PEG programming.  
 
The proposal, officially known as MB Docket No. 05-311 — Cable Franchise Fee Deduction, would supersede California’s law under the Digital Infrastructure and Video Compliance Act.
 
California’s 2006 act streamlined the deployment of cable services by making the California Public Utilities Commission (CPUC) the sole franchising authority in the state and preserved many of the provisions commonly found in local franchise ordinances. Enacting this, the Legislature intended to streamline deployment while keeping local government revenues intact, ensure that local public rights-of-way remain controlled by cities and counties, and that the cable networks preserved a sufficient capacity for PEG access channels.
 
While the proposal poses a serious threat to PEG access and availability, which alone are concerning, the proposal would also prohibit local governments from regulating the facilities and equipment used by cable operators in the provision of non-cable services, such as wireless communications. This second component of the proposal would severely restrict and eliminate local discretion over the installation of small cell wireless facilities deployed by cable operators. Fair compensation for use of the public right-of-way, public input, and addressing local aesthetic concerns aimed at mitigating blight would all be threatened under this proposal.
 
Take Action
 
Public comments are due to the FCC by Wednesday, Nov. 14 by 9 p.m., Pacific Standard Time.
 
The League has prepared a sample letter for cities to use.
 
Comments should be sent electronically to the FCC through this portal: https://www.fcc.gov/ecfs/filings.
 
In addition, city officials should contact their congressional representatives and California’s two senators to oppose this policy that threatens local PEG services, franchise fee revenues and local discretion over cable and non-cable facilities.


 
© League of California Cities