Rights of Way: To Infinity and Beyond

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Rights of WayTo Infinity and Beyond!
NATOA Annual Conference Lake Buena Vista,
Florida August 25, 2006
Frederick E. Ellrod III Miller Van Eaton,
P.L.L.C. www.millervaneaton.com
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Introduction

• Recent developments Bell entry into the cable
  market
• Pending legislation (federal and state)
• What forward-looking policies should communities
  adopt for right-of-way (ROW) use?

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Introduction

• Major issues
• ROW compensation
• ROW management
• Consumer protection
• Local governments communications needs I-Nets
• Municipal systems for public use
• Focus on first three issues here

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Introduction

• In cable, all these issues traditionally handled
  through cable franchise
• But they relate to different groups of ROW users
• Hence, separate laws with different applicability
  to ROW users
• Focus less on entry process and more on
  substantive requirements

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ROW Compensation

• First issue Can you charge market value, or
  only costs?
• State law controls For example
• Iowa permits only cost recovery
• Virginia specifies access line charge
• Oregon allows gross revenue-based fee
• Section 253 cases also affect this issue

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ROW Compensation

• If limited to costs, possible candidates
• Administrative costs
• Inspection costs
• Safety precautions e.g., police presence
• Determining locations, resolving conflicts
• Maintenance of ROW
• Related maintenance, e.g., tree trimming
• Construction of ROW improvements
• Traffic delays, disrupted business

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ROW Compensation

• Ways of charging for ROW use
• Gross revenue-based fees
• Linear foot fees
• Throughput fees
• Variations
• Taxes that take the place of fees
• In-kind benefits
• Per-site fees for wireless carriers

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ROW Compensation

• May be able to distinguish classes of users
  (e.g., serving residents vs. passing through)
  but must be careful
• Audit provisions for fees
• Any application process should be as streamlined
  as possible and give specific criteria for
  acceptance

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ROW Management

• Tulsa ordinance illustrates issues
• Entry of Bell companies into cable market raises
  issue of ROW management
• Living with the Bells will be easier if ROW
  management can be handled under a general
  ordinance rather than a cable franchise

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ROW Management

• ROW ordinances should take into account pervasive
  use by distributed wireless systems as well as
  wireline
• General ROW use should be kept distinct from
  specific leases for buildings or sites

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ROW Management

• What may be included in ordinance
• Definition of public rights-of-way should not
  automatically include parks, bridges, and the
  like
• Compliance with safety codes
• Permits for activity in ROW
• How to apply
• Fees
• Duration
• General blanket maintenance permits

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ROW Management

• What may be included in ordinance
• Insurance
• Indemnification
• Warranty covering work in ROW
• Liability of company performing the work
• Security bond, letter of credit, escrow
• Permit and inspection fees

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ROW Management

• What may be included in ordinance
• Excavation
• Plan for future excavations
• Joint trenching (esp. in new developments)
• Notice to public of ROW work
• Citizen complaint process

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ROW Management

• What may be included in ordinance
• Conduit
• Requiring company to use conduit in paved streets
• Allowing community to install its own conduit
  when streets are opened
• Latter provision is most defensible when the
  community bears the cost of its own conduit

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ROW Management

• What may be included in ordinance
• Relocation of facilities when necessary
• Undergrounding
• Main question is who pays
• Various utilities may have state law rights
• Restoration of damage
• To public ROW
• To private property

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ROW Management

• What may be included in ordinance
• Maps
• May need location and type of facility (fiber or
  copper), but not details
• GIS format may be an issue
• Reservation of police powers and other
  governmental rights

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ROW Management

• What may be included in ordinance
• Enforcement
• If eviction of user is not an option, effective
  cure and punishment powers needed
• Ordinance-based penalties rather than liquidated
  damages (which are a contract remedy but there
  may be no contract)
• Stop work order
• May retain right to evict in extreme cases, with
  due process

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ROW Management

• What may be included in ordinance
• Transfers not entry regulation, but knowing who
  is in ROW
• Stay away from anything that looks like service
  regulation
• Check state law limitations that might prevent a
  community from addressing any of the above issues

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Consumer Protection

• Applies where provider serves residents, not
  merely passing through
• Cable modem issue illustrates situation
• Cable Act acknowledges authority re video
• Telephone and other utilities are generally
  regulated by public utility commissions
• FCC has acknowledged that only localities can
  currently deal with cable modem complaints

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Consumer Protection

• Municipal consumer protection authority
• Community may have specific state law authority
• General home rule or charter status may include
  such authority
• Police powers for the preservation and
  furtherance of the public peace, order, health,
  morality, and welfare (McQuillin)

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Consumer Protection

• Most consumer protection issues are not
  service-specific telephone answering,
  appointments, notices to subscribers, billing
  practices (as distinct from rates)
• Some are service-specific e.g., privacy or
  parental controls for cable should probably not
  be treated in a general consumer protection
  ordinance

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Consumer Protection

• Determine where state or federal law preempts
  local authority (e.g., public service commission
  may have exclusive jurisdiction over telephony
  complaints)
• Standards should be as definite as possible
• Problem of qualitative vs. quantitative standards
  for customer service

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Municipal Networking

• Major issues deserving separate treatment a few
  words here
• Institutional networks assets from
• cable franchises?
• telecommunications franchises?
• direct investment by community?
• Dark fiber vs. managed networks

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Municipal Networking

• State law may constrain ability to acquire or use
  institutional network assets (e.g., Texas)
• Noncommercial clauses may limit potential use
  in connection with public networks such as Wi-Fi
  systems

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Conclusion

• Best strategy at this point may be adoption of a
  set of separate ordinances addressing the areas
  discussed
• Ordinances should strive for
• flexibility to adapt to changes in federal and
  state law
• defensibility against attacks from various ROW
  users