INFORMATION #4 12-03-2007 - Laserfiche WebLink

Home Browse Search

that "PEG support payments" do count as franchise fees. This apparently refers to funding for PEG operations which "may include, but are not limited to, salaries and training." Order, ¶ 109. Current federal law establishes a distinction between PEG support for capital/equipment, which is excluded from franchise fees, and operating support which must be funded from franchise fees. 47 U.S.C. § 542 (g)(2)(C). Notwithstanding, some incumbent cable operators have accepted franchises that, in addition to franchise fees, include PEG fee obligations to fund both PEG capital and operational needs. The Order suggests that competitors may demand that all PEG operational support come exclusively from franchise fees. However, under Minnesota law a competitor's PEG support obligation must be "no more favorable or less burdensome" than the incumbent's obligation. Minn. Stat. § 238.08, Subd. 1(b). Because the Order does not preempt this statutory requirement, a competitor should still be obligated to match an incumbent's support for PEG operations over and above franchise fees. Whether I-Net support also falls within Minnesota's level playing field requirement is an open question. The Order also concludes that "it is unreasonable for an LFA to require a new entrant to provide PEG support that is in excess of the incumbent cable operator's obligations." Order, ¶ 114 and ¶ 120. Minnesota law, however, provides to the contrary. Minn. Stat. § 238.08, Subds. 1(b) and 2. This state statutory authority is not preempted. Finally, the FCC recommends (but does not require) that new entrants assume a pro rata share of the incumbent's PEG support based on a calculation of the "per subscriber payment at the time the competitive applicant applies for a franchise..." Order, ¶ 120 n. 396. It will be difficult or impossible to make such calculation unless the incumbent is providing PEG support in a continuing per-subscriber payment; i.e. a PEG fee. Local Authority Over "Mixed-Use Networks" The Order indicates that LFAs cannot refuse a franchise based on issues unrelated to "the provision of cable services over cable systems." Order, ¶ 121. The FCC recognizes, however, that LFAs have authority over right-of--way issues that arise from the deployment of video- related equipment. Order, ¶ 70 n. 264. Nothing in existing Minnesota law suggests that municipalities may use cable franchising authority to obtain commitments for non-cable services. The Order does not appear to interfere with other municipal authority such as right-of--way management authority under Minnesota Statutes, Sections 237.162 and .163, associated PUC rules, and local ordinances. Notice of Proposed Rulemaking The FCC proposes to apply the Order to incumbent cable operators at franchise renewal. Order, ¶ 140. Because Minnesota's level playing field statute is intended to protect incumbents and applies specifically to "an additional franchise," state law would not insulate franchise renewal negotiations from the Order's impact. If the issues described above are applied to existing 6