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Federal Communications Law Journal

Document Type

Article

Publication Date

12-2011

Publication Citation

64 Federal Communications Law Journal 137 (2011)

Abstract

This Article addresses the enactment and inconsistent application of Section 253 of Telecommunications Act of 1996 ("FTA"). Most courts initially held that Section 253 imposed strong limitations on local governments seeking to charge fees to telecommunications carriers for use of the public rights-of-way ("PROW') by generally limiting the fees to management costs. Unfortunately, recent cases allowed local governments broad latitude in charging PROW fees to generate revenue, even where the fees are used to subsidize other government services. These "revenue-generating" fees are dangerous to the development of competition and the deployment of Internet services, which were the two primary goals of the FTA. Because these revenue-generating fees generally only apply to carriers with primary relationships with local governments, they do not impact many wireless carriers, Voice over Internet Protocol providers, or carriers leasing PROW occupancy from the incumbents. This creates an unlevel playing field among competitors, which is dangerous in the increasingly commoditized market of communications. Further, the fees act as an obstacle to network expansion and deployment. On April 7, 2011, the FCC issued a Notice of Inquiry ("NOT') specifically focused on PROW regulation reform. This Article calls on the FCC to use the NOI to restore Section 253 to its original intent. This Article specifically requests that the FCC makes clear that Section 253 limits PROW fees to recovery of the government's management costs plus a fair market "value" that is calculated by determining what the government could collect for the PROW assuming competitive market conditions.

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