A draft proposal being considered by the House Energy and Commerce Committee related to pole attachments “is a thinly veiled attempt to have not-for-profit electric utilities subsidize for-profit entities’ infrastructure,” the American Public Power Association, National Rural Electric Cooperative Association and Utilities Technology Council told lawmakers in an April 18 letter.
The draft proposal would amend section 224 of the Communications Act to provide that the current exemption public power utilities and electric cooperatives have from Federal Communications Commission jurisdiction over pole attachments would not apply to entities that receive certain federal broadband assistance.
The draft proposal was part of a slate of bills that was scheduled to be discussed at the House Energy and Commerce Subcommittee on Telecommunications and Technology legislative hearing on April 19.
“The narrative for offering this proposal is that broadband attachers are having difficulty spending federal broadband funding they have recently received because attachment rates are making deployment costs too high or that utilities are making access to poles too difficult by requiring recovery of pole replacement costs,” the three trade groups said.
“These assertions are false and essentially imply that not-for-profit electric utilities are making it difficult for their communities to receive broadband service. That premise couldn’t be further from the truth given such not-for-profit utilities are owned by their customers and want them to have essential broadband services,” APPA, NRECA and UTC said.
Congress first addressed pole attachments in the Pole Attachment Act of 1978, which added section 224 to the Communications Act, to require the FCC to establish subsidized rates for pole attachments for the then-new cable industry.
Under the law, public power utilities and rural electric cooperatives were exempted from this requirement “because the pole attachment rates charged by municipally owned and cooperative utilities [were] already subject to a decision-making process based upon constituent needs and interests.” This exemption continued through multiple telecommunications law reform efforts, including the enactment of the Telecommunications Act of 1996, because Congress maintained that the existing process is appropriate and adequate.
“Electric utilities must balance their own need to maintain and operate their utility systems in a safe, reliable, and affordable manner while also addressing the often-competing needs of a variety of attaching communications entities,” the letter noted.
The groups said that Congress has repeatedly recognized that federal pole attachment regulation is unnecessary for public power and electric cooperative pole owners because they are owned by their customers, “the same customers that would benefit from communications services provided over the facilities attached to their poles.” Not-for-profit electric utilities “have every incentive to apportion the costs of constructing and maintaining the pole attachments in an equitable manner among attaching entities.”
This legislative proposal “is nothing more than an effort to weaken or eliminate the exemption in section 224 of the Communications Act. Modifying or eliminating the exemption will not result in any significant increases in broadband deployment, adoption, and use. Instead, it will merely result in not-for-profit electric utility customers subsidizing for-profit telecommunications and cable companies,” the groups said.
Therefore, APPA, NRECA, and UTC oppose this draft legislation, “which would weaken or eliminate the exemption in section 224 for consumer-owned poles.”
The letter was directed to leaders of the Subcommittee on Telecommunications and Technology and the House Energy and Commerce Committee and has been shared extensively with membership on the committee.