By Ron Thaniel
February 6, 2006

Focusing on the threat to local government communications authority as Congress debates the rewrite of the Federal Communications Act, the Transportation and Communications Standing Committee, under the leadership of Chair Denver Mayor John Hickenlooper and Conference Vice President Dearborn Mayor Michael A. Guido, welcomed a strong partner with mayors, John D. Dingell (MI), Ranking Member on the Committee on Energy and Commerce of the U.S. House of Representatives.

Telecommunications attorney Arvada Mayor Ken Fellman and telecommunications legal expert Managing Partner of Miller & Van Eaton Nicholas Miller also briefed the mayors on these challenges in the rewrite of the Federal Communications Act.

National Railroad Passenger Corporation (Amtrak) Chairman of the Board David M. Laney addressed the long-delayed authorization of the nation’s intercity rail.

Joining the Committee for the communications rewrite debate, Dingell introduced the discussion stating, “Mayors have been on the front line in this effort. You provide the important local neighborhood-by-neighborhood perspective, and for federal policy to be effective, it must be crafted with those views in mind.”

Noting the remarkable transformation in the world of telecommunications, Dingell said, “Congress faces enormous pressures to update the telecommunications laws for this modern era, and beyond. The role of local governments in future telecommunications policy is far from certain.”

“Measures introduced so far in Congress would allow traditional telephone providers to enter the video (cable) market to provide video services without obtaining local franchise agreements,” said Hickenlooper. Guido noted, “Without a local franchise agreement, many of the mechanisms that local governments use would be eliminated.”

Urging the mayors, Dingell stated, “It is imperative that you redouble your efforts to work with Congress and the industry to shape the new policies.”

Furthermore, he said, “You have important responsibilities to manage city property for the safety and benefit of all citizens. But many are questioning what that means in a world where traditional telephone and cable services are broken down into digital bits and sent across interstate data networks.”

“This explosion of new content delivery methods will challenge and test current Cable Act definitions, and may put your franchise authority at risk,” said Dingell.

“There is little understanding on Capitol Hill of the many ways in which legally-entitled franchise fees and other franchise provisions directly benefit citizens at the local level,” noted the Congressman.

Dingell also mentioned that the mayors will need to have a strong presence helping Congress understand the importance of public, educational, and government channels (PEG), institutional networks (I-Nets) which provide critical capacity for first responders, and build out which requires cable operators to become capable of serving all households after a reasonable period of time.

He also stressed the urgency that, “First responders must get the spectrum and funding needed to make interoperable communications a reality.”

In addition to the Standing Committee rewrite discussion, Hickenlooper hosted a telecommunication workshop focused on FCC and State level preemption of local government communications authority.

Speaking on these concerns were Tillman L. Lay, Esq., of Counsel with the law firm of Spiegel & McDiarmid, John W. Pestle, Partner with the law firm of Varnum, Riddering, Schmidt and Howlett L.L.P., and Elizabeth Beaty, Executive Director with the National Association of Telecommunications Officers and Advisors (NATOA).

To view their presentations as well as Dingell’s remarks, visit the Conference’s website at www.usmayors.org and link to the Washington Update Transportation and Communications Policy/Advocacy page.

Welcoming Chairman of the Board for the National Railroad Passenger Corporation, David M. Laney back to the Conference, Hickenlooper said that the Conference of Mayors is committed to an authorization of Amtrak that maintains the national system and improves intercity passenger rail corridors linking America’s cities.

Laney told the mayors that the Board is 100 percent committed to leveraging the full potential of intercity rail service in our national transportation mix.”

“We want to fix Amtrak’s problems, and make it better. It is not our goal to destroy, dismantle or privatize Amtrak as some have falsely claimed,” said Laney.

Indirectly responding the termination of Amtrak’s past President and CEO David Gunn last November, Laney said, “Hugh challenges still lie ahead that Amtrak will not and cannot overcome on its present course.”

He noted, “For the last four years, in spite of the improvement … Amtrak has had operating losses of nearly $500 million each year.”

Furthermore, Laney said, “A key indicator that Amtrak’s business needs substantial re-engineering is the fact that labor costs (salary and related expenses including benefits) were 103 percent of passenger related revenue in fiscal 2005.”

The third point he focused on was that Amtrak has substantial difficulties that drive costs and losses up: food and beverage service, long distance service, and on-time performance problems.

Responding to concerns raised by the mayors regarding the national system, Laney highlighted the four key elements of Amtrak’s strategic plan:

1. Development of passenger rail corridors based on an 80-20 federal state capital matching program, with states becoming “purchasers” of a variety of competitively bid corridor services.

2. Return of the Northeast Corridor Infrastructure to a state of good repair and operational reliability.

3. Preservation of our national long distance system with gradually restructured routes that will over time have to meet minimum financial performance requirements.

4. The opening of intercity passenger rail to competition and private commercial participation.

Concluding, Laney agreed with the mayors that Congress should act on the long-delayed authorization of Amtrak.