At this time of year when state legislative sessions have ended or are coming to a close, there are usually one or two bills making their way to governors for signature that, in some form or another, regulate pole owning electric cooperatives and/or municipalities for pole attachment purposes. As a general matter, electric cooperatives and municipalities are not usually subject to pole attachment regulation. For example, the federal Pole Attachment Act, as amended by the Telecommunications Act of 1996, codified at 47 U.S.C. § 224, exempts electric cooperatives and municipalities from federal pole regulation. 47 U.S.C. §224(a)(1).
The Pole Attachment Act governs attachments on investor-owned utility poles only. While some “FCC states” (states whose investor-owned utilities are regulated by the FCC for pole attachment purposes) and some “certified states” (states that have preempted federal regulation of pole attachments), regulate cooperatives and/or municipalities for pole attachment purposes, many do not. As a result, it is often up to communications attachers to push for new laws regulating pole attachment practices by municipally and cooperatively owned utilities.
Over the last decade, due to efforts by communications attachers, more and more state legislatures have passed pole attachment laws covering cooperatives and municipalities because they understand that cost-efficient broadband deployment is hindered by unregulated pole owners that are not required to provide access to poles on just and reasonable rates, terms and conditions. This year, the Texas and Missouri state legislatures passed bills covering poles owned by electric cooperatives and municipalities, respectively.
The Texas bill, H.B. 3355, requires electric cooperatives to negotiate pole attachment agreements in good faith and that any rate, term or condition demanded by the cooperative be just and reasonable. The bill also requires pole owners to provide access, which can only be denied for insufficient capacity or for reasons of safety, reliability or generally applicable engineering purposes.
The Missouri bill, H.B. 345, requires that the rates, terms and conditions of pole attachments, including those related to access, be nondiscriminatory, just and reasonable. The bill requires that the annual pole attachment rent be charged on a “per pole” basis and capped at the federal cable formula, as applied by the Federal Communications Commission, unless the pole owner can demonstrate that the federal cable formula and other direct payments made by the attacher do not allow the pole owner to recover its costs.
Neither bill supersedes the provisions of contracts existing prior to the effective date of the respective bills. Other states that have recently passed laws covering electric cooperatives and/or municipalities include: California, North Carolina and Virginia.
Please contact us if you would like more information on laws covering pole owning electric cooperatives and municipalities.