By Ron Thaniel
August 8, 2005

Before adjourning for the august recess July 27, Senator John Ensign (NV), chairman of the Senate Commerce, Science and Transportation Subcommittee on Technology, Innovation and Competitiveness introduced the first major telecommunications reform bill of the 109th Congress. “The Broadband Consumer Choice Act of 2005” is being described as a marker, as the full Committee waits for a wide-ranging telecommunications rewrite measure from Committee Chair Ted Stevens (AK) when Congress returns after the recess.

With local government authority over video services squarely the target, Ensign’s bill, similar to bills introduced earlier in the House (H.R. 3146) and Senate (S.1349), allows traditional telephone providers entering the video market to provide video service without obtaining local franchise agreements. This provision ignores the fact that a telephone company’s certificate of public convenience is not a cable franchise, nor a legal grant to provide cable services.

Ensign’s bill would eliminate local cable franchising authority, including all existing cable franchises, an action of urgent concern for local government.

By prohibiting local governments from requiring franchise agreements over cable and the Bells entering the video market, cites and suburbs lose their tool used to collect franchise fees, impose public, educational and government (PEG) public access channels and customer service requirements, prohibit economic redlining, and severely weakens management of public rights-of-way.

Contrary to reports as the bill was introduced, it does not directly protect the 5 percent gross revenue cable franchise fee by limiting these fees to the costs of managing the rights-of-way, which significantly reduces the recognized permitted franchise fee base. Essentially, under Ensign’s bill, even if local governments can charge 5 percent, it will receive less fee revenue than at present due to a smaller gross revenue base.

Points of Concern in the Broadband Consumer Choice Act of 2005 Identified by the U.S. Conference of Mayors:

• The bill permits video service providers to request the Federal Communications Commission (FCC) to reduce their franchise fees or file claim in the federal court.

• Local government cannot assess fees for rights-of-way construction permits.

• Video service providers are protected from build out requirements thereby reversing long standing efforts to eradicate the digital divide.

• Local governments are prohibited from providing broadband and other advance services without first giving the private sector the right of first refusal. Existing local government services are grandfathered.

• The bill eliminates rate regulation of telephone or video service.

• Video providers would only be required to offer four PEG public access channels. Local government must decide, if there are more than four, which PEG channels should be eliminated.

• Consumer protection rules would be adopted at the federal level.

  Action Alert:

  Over the month long Congressional August recess, meet with your members in the House and Senate and urge them not to support any legislation that would, including the Video Choice Act of 2005 (H.R. 3146 & S. 1349) and the Broadband Consumer Choice Act of 2005:

• Preempt local government’s franchise authority of cable and telephone providers entering the local video market.

• Preempt local government’s longstanding authority to management and collect rent for use of public rights-of-way.

• Does not require reasonable build out of video services to all citizens, regardless of income or location.

• Preempts local government customer service and consumer protection standards on video service providers.

Without your urgent action over the August recess, the telecommunications giants will continue to influence legislation in Washington intended to strip local governments of their traditional regulatory authority over telecommunications.

To make certain traditional telephone providers have successful entry into the video market while protecting critical public safety, preserving physical rights-of-way, and closing of the economic divide by the reasonable deployment of broadband services to all citizens. The Conference adopted policy at its 73rd Annual Meeting in June urging Congress not to preempt local authority to negotiate and grant franchises to video providers regardless of the technology used.

Action Alert:

Over the month long Congressional August recess, meet with your members in the House and Senate and urge them to support critical interoperable spectrum communications needs of first responders by adhering to the “sense of the Congress” in the Intelligence Reform and Terrorism Prevention Act of 2004 that Congress must pass legislation in 2005 that establishes a comprehensive approach to the timely return of analog broadcast spectrum as early as December 31, 2006 for public safety use.