On March 16,2022 The FCC adopted a Second Notice of Proposed Rulemaking regarding the FCC’s Pole Attachment Rules. Comments and Reply Comments were filed by many interested parties and in the ensuing months many ex-parte discussions have occurred. These discussions have focused primarily on the appropriate treatment of pole replacement costs. Many commenters have posited that the existing rules are fair and equitable and should not be changed while others have suggested that the current rules are unfair and have further argued that the timely deployment of broadband services in rural areas is being negatively affected by unnecessary delays as a result of the existing rules. The list of commenters on this issue include, among others, US Telecom, AT&T, Edison Electric, and the Coalition of Concerned Utilities, as well as NCTA, Comcast, Cox, and Charter. In addition, three members of the U.S. House of Representatives have recently sent letters to FCC Chairwoman Rosenworcel echoing the concerns expressed by other parties that the existing rules are causing delays in the delivery of hi-speed broadband service to rural America. Following are some key facts and dates regarding the FCC’s Pole Attachment Rules:
* Section 224 of the Telecommunications Act grants the FCC the authority to regulate the rates, terms, and conditions of Pole Attachments. In 1996, as part of its implementation of the 1996 Telecommunications Act, the FCC stated that when a modification such as a pole replacement is undertaken solely for the benefit of a particular party, that party should bear the cost of the replacement. Conversely, when the replacement occurs solely for the benefit of the utility that owns the pole, the utility should bear the full cost. When the replacement is mutually beneficial to all attachers, the cost should be shared by all.
* On 7/16/20, NCTA, the Internet and Television Association, filed a petition requesting the FCC to amend and clarify its rules regarding pole replacements. NCTA argued that without FCC action the costs and operational challenges associated with pole replacements will inhibit attachers from deploying broadband to unserved areas. The FCC declined to act on the petition finding that it was more appropriate to address cost allocation issues in the context of a NPRM. It found, however, that the record in the NCTA Petition revealed inconsistent practices by utilities regarding the assignment of cost responsibility for pole replacements. In January, 2021, the FCC issued a Declaratory Ruling clarifying that pursuant to Section 1.1408(b) of its rules and precedent, utilities may not require attachers to bear the entire cost of pole replacements that are not “solely necessitated” by the new attacher and may not avoid responsibility for pole replacement costs by postponing replacements.
The FCC’s goal in issuing the March 16, 2022 Second Notice of Proposed Rulemaking is to establish clear standards for how utilities and attachers must share the costs of pole replacements. The FCC believes resolving issues related to pole replacements can help speed the deployment of broadband service and facilities. Comments were sought relative to the following issues, among others:
* How to determine whether and to what extent utilities benefit from pole replacements when the replacement is not “necessitated solely” by a new attachment request.
* What standards should be in place for requiring the utility to pay a share of pole replacement costs.
* What measures can be put in place to avoid disputes or to expedite the resolution of disputes.
* Comments are sought on specific situations where the attacher should not be required to pay the full cost of a pole replacement.
As mentioned above, three members of Congress have contacted Chairwoman Rosenworcel to express concerns about the FCC’s Pole Attachment Rules and their belief that the existing rules are causing delays in the delivery of broadband service to rural America. In her response to these concerns she points to the March 16, 2022 Second Notice of Proposed Rulemaking that sought comment on questions concerning the proper treatment of pole replacement costs as well as whether there are reforms that can expedite the process of negotiations over pole replacements. She further states that the FCC staff is currently reviewing the record in this proceeding and will take into account the comments and concerns expressed by all stakeholders.
This issue is of great importance to all utilities and pole owners. ICORE will continue to closely monitor the FCC for further developments regarding this proposed rulemaking and will provide updates when new information becomes available.
As always, if you have any questions please contact Chris Ulmer on 610-928-3903 or via email at culmer@icorellc.com.
