Local Government Organizations Ask FCC To Stay Second Video Franchise Order
Late last year, national local government organizations representing municipal and county officials, including the National League of Cities (NLC), asked the Federal Communications Commission (FCC) not to implement its Second Video Franchise Order (Second Order) pending reconsideration and clarification of the order. That request is still pending, and the order went into effect on December 24, 2007.
In documents filed with the FCC, the organizations assert that several aspects of the Second Order are unclear or were decided in error.
In a 3-2 decision released late last year, the FCC extended to incumbent cable operators several aspects of an earlier video franchise order. In the Second Order, the FCC concluded that the five-percent cap on franchise fees established in its First Video Franchising Order applies to incumbents.
Also, as it did in the First Order, the FCC determined in the second order that services or facilities provided by an incumbent operator for public, educational, and governmental (PEG) access channels and institutional network (I-Net) support count toward the five-percent cap. Importantly, in the Second Order, the FCC did not expressly nullify existing franchises. An incumbent will have the burden to prove, under the facts and circumstances of each situation, that the new rules apply to its franchise.
In the Motion for Stay filed at the FCC, the organizations argue that the Second Order will disrupt local franchising authorities’ well-settled and long-standing contractual expectations and will result in increased uncertainty and expensive litigation.
The organizations also contend that the stay request is in the public interest since it will ensure that existing franchise agreements that reflect the needs and interests of the citizens remain in place while the FCC considers the Petition for Reconsideration now pending before the agency.
In the Petition for Reconsideration, the organizations argue that the agency erred by allowing some remedies, such as relief from providing PEG access channels and I-Net support, that were granted to new entrants under the First Order to indirectly apply to incumbent operators.
The FCC also failed, according to the petition, to consider the true economic impact of the Second Order on local governments and PEG channel operations.
Finally, the organizations assert that the FCC should clarify whether the findings of the Second Order are applicable to incumbent providers in states (like Texas) that have enacted state-level video franchising legislation.
Other groups joining the NLC in last week’s FCC action were the Alliance for Communications Democracy, the Alliance for Community Media, the National Association of Counties, the National Association of Telecommunications Officers and Advisors, and the U.S. Conference of Mayors.
Earlier in 2007, the groups asked the United States Sixth Circuit Court of Appeals to reverse the FCC’s decision in the First Order. That request is pending, and oral argument is scheduled for the first week of February 2008. A decision is expected in the second quarter of 2008.