By Ron Thaniel
July 3, 2006

Before adjourning for the July 4th recess, on June 28, the Senate Commerce, Science and Transportation Committee approved a sweeping telecommunications bill. The bill places a moratorium on all new cell phone'specific taxes, makes extension of the Internet Tax Freedom Act permanent, and allows providers of the broadband-video service to use the public rights-of-way in a community, but pick and choose which neighborhoods they wish to serve while bypassing all others completely.

While the Committee had close votes on build-out and net neutrality, the Committee approved on a 15-7 vote the Communications, Consumer’s Choice, and Broadband Deployment Act of 2005 (H.R. 5252).

The House had earlier approved their counterpart in June, the Communications, Opportunity, Promotion, and Enhancement Act of 2006 (H.R. 5252).

The Conference of Mayors had negotiated substantial improvements in the legislation prior to last week’s action. Those included:

Preservation of local control and authority to manage rights-of-ways (ROW)

Courts, rather than the Federal Communications Commission (FCC), to settle ROW disputes

Attorney fees are the responsibility of each party in ROW disputes

Lump sum payments in calculating the per'subscriber equivalent for Public, Educational and Government (PEG) as an alternative to the 1 percent of gross revenues for PEG support fee

Franchise fees on taxes the videos service operators pay

Clarification on the timeframe from 75 days to 90 days for action by cities on new video franchises.

However, the Conference of Mayors is very concerned with the inclusion, during the markup of the bill, of a new cell phone'specific tax moratorium introduced by Senator John McCain (AZ) and two other provisions.

These were extensions of the Internet Tax Freedom Act introduced by Senator George Allen (VA). Also, modification to the definition of video service provider as to the applicability of this bill to AT&T’s new video service was introduced by Senator John Ensign (NV).

The McCain cell phone'specific tax moratorium places a three-year ban on new state and local wireless'specific taxes. The Allen Interest Access Tax Moratorium amendment makes the current moratorium on Internet-access taxes permanent.

A letter is being sent July 3 urging that these provisions be removed during the Senate floor debate. The letter, to Commerce Committee Chairman Ted Stevens (AK) and Ranking Committee Member Daniel K. Inouye (HI), is from the Conference of Mayors, National League of Cities, National Association of Counties, and the National Association of Telecommunications Officers and Advisors.