LOCAL GOVERNMENT AUTHORITY OVER COMMUNICATIONS NETWORKS IN THE PUBLIC RIGHTS-OF-WAY

1. LOCAL GOVERNMENT AUTHORITY OVER COMMUNICATIONS NETWORKS IN THE PUBLIC RIGHTS-OF-WAY Nicholas P. Miller Miller & Van Eaton, PLLC NATOA Regional Seminar April/May, 2000 www.millervaneaton.com

2. OVERVIEW Types of Users of Rights of Way Types of Local Grants to Use Rights of Way The Continued Evolution of Federal Law Some Issues Challenging Local Governments

3. Federal Law Anticipated CATV only companies. Telecommunications only companies. OVS only companies Private networks

4. Who Else is Using Rights of Way? Non-telecommunications/non cable cos. Dark fiber providers Conduit providers “Pass-through”/”spot” users Combo companies/consortia

5. Local Governments’ Response Government Property normal state property law controls right to use local governments own or control right to use local governments can set terms of “rent” Exception: prior State grant of property to company recent State reclaim of property from local governments

6. State Property Law Company must acquire a property right (right to “Use”) from the owner of the property “Estate in Fee”/Lease/Easement/ Franchise/or License (explicit or implicit) required Fifth Amendment: Federal Law may NOT Preempt State Property Law

7. Federal Law Preserves--(47 USC 253(c) right to charge Rent right to manage behavior in ROW

8. Companies Response Regulation in the Guise of Property Rights State PUCs, not Locals, Retain Authority to Regulate--253(b) Local regulation preempted--253(a) Taxation in the Guise of Rent No New Property Interest States/Locals gave RBOCs easements long ago new companies have right to “partition” the same easements e.g. 47 USC 224 “Compensation” limited to impact fees

9. Every Word and Phrase in Sec 253 Still Disputed

10. What is a PROHIBITION? Is control over entry permitted at all? Most courts: “yes” Several courts: “limited authority to deny entry” E.G.: Wireless Services and Networks NO authority over service offerings Authority to restrict use of PROW Primeco v. Chicago (Ill. S. Ct.) Mar 30, 2001

11. What is “non-discriminatory” and “competitively neutral”? Dearborn: local gov’t can distinguish between new entrants and incumbents Omnipoint: local gov’t can require new entrant to conform to pre-existing standards Cablevision of Boston: local gov’t can impose different terms on new entrant

12. What is “use” of the ROW? Austin/Dallas: Only new physical occupation in specific locations Coral Springs/Omnipoint: Any inchoate burden on the property FCC in MinnDOT: no “unfair competitive advantage”

13. What is permitted “Management”? TCG v. White Plains (12/20/00)/Coral Springs: No duplication of State PUC regulation Dallas/Prince Georges: Same rules must apply to all

14. What is “Fair and Reasonable Compensation”?

15. NOT limited to recovery of costs and Gross revenues OK TCG v. Dearborn (6th Cir) Omnipoint Communications Inc. v. Port Authority of New York (1st Cir) Bell South v. Orangeburg (S.Car. S. Ct.) White Plains

16. IS limited to recovery of impact costs Bell Atlantic v. Prince George's County, Md. (Fed. D.Ct. of Md--since vacated) AT&T v. City of Dallas (Fed. D. Ct. of Tx) AT&T v. City of Austin (Fed. D. Ct. of Tx) PECO Energy Co. v. Haverford (Fed. D. Ct. of Pa) Grant County NM v. USWest (unreported 6/00)

17. Court Cases turn on state property and regulatory law Dearborn Prince George’s County, Md Coral Springs, Fl White Plains Denver v. Qwest (3/13/01), Colo S. Ct.

18. Issues to Ponder

19. Non Telecom /Non Cable Providers e.g. Metricom Not covered by 47 U.S.C. §253; often not covered by state or local laws. Is there local authority to franchise? If so, treat like telecom companies? Like cable? Does treatment affect claims of telecom providers?

20. Combination Facilities Does a combination facility obtain: The best of the benefits afforded by law under any line of business in which it operates? None of the benefits? Benefits only to the extent that the facility is engaged in the provision of a particular service?

21. “Spot” Users/ Pass-through Users Wireline: How charge when not providing service in City? Do you franchise such a company? Do you have any other option? Wireless/”Spot” Users: Often occupy ROW plus poles and other City property. What property is being used? How do you charge for spot uses of ROW or other property?

22. AD HOC AGREEMENTS --short term relief, long term pain avoids immediate litigation risks least restrictive terms in each agreement will apply to all risks granting free and unlimited property interests imposes contractual limits on future regulations most vulnerable to claims of discrimination

23. A RIGHT-0F-WAY ORDINANCE--short term pain, long term control Companies Uniformly Join to Intimidate Tell the Courts What You are Trying to Do Define Scope of Your Authority to Control Entry Right-of-Way Management Authority Compensation Mechanisms Enforcement Authority

24. CONCLUSION Management SHOULD NOT be the fight Every Provider becomes an Incumbent Huge private investment Compensation Fight is Real Short-sighted by industry lobbyists Long-term taxpayer costs Electeds Must Be Told the Taxpayers’ Interest