IP: NINE STATES HAVE BARRIERS TO PUBLICLY OWNED TELECOM SMART Letter #68

[Dave Farber <dave () farber net>]

------ Forwarded Message
From: "David S. Isenberg" <isen () isen com>
Reply-To: isen () isen com
Date: Sun, 17 Mar 2002 18:38:55 -0500
To: farber () cis upenn edu
Subject: Packet Relay Radio to the Rescue: SMART Letter #68


NINE STATES HAVE BARRIERS TO PUBLICLY OWNED TELECOM
by David S. Isenberg

Communications technologies continue to improve despite the
telecom recession.  As the gap widens between what is
possible and what is deployed, the threat to established
business models grows accordingly.  The Incumbent Local
Exchange Carriers (ILECs) and their allies in the
publishing/entertainment industry and other sectors must
fight harder and harder to preserve the technological
underpinnings of their old business.

The Tauzin-Dingell DSL non-competition bill is an example
of such a hold-back-the-future battle.  Fortunately, it is
likely to die in the U.S. Senate.  Senator Hollings,
chairman of the Senate's Commerce Committee, vividly
described the bill's purpose in a Senate speech on February
25, 2002:
  "Hailed as a way to enhance competition, it eliminates
   it. Touted as a way to enhance broadband communications,
   it merely allows the Bell companies to extend their
   local monopoly into broadband."

Despite the anticipated death of Tauzin-Dingell, the
network of the future has few friends in government.
Hollings is no gigabit guru; he is opposed to Tauzin-
Dingell because he is a friend of AT&T (the *cable* non-
competition company) and to the konstipated kontent krowd.

Meanwhile, the ILEC teleban is regrouping in regulatory and
legislative caves of several state governments.  Having
killed off the Competitive Local Exchange (CLEC) business,
it is going after the next threat -- forward looking public
entities, such as municipal utility districts and publicly
owned power companies, that see how important an advanced
communications infrastructure is to their local economies.

Today there are nine states with significant barriers to
publicly owned telecommunications, up from four in 1998
(see SMART Letter #12, October 10, 1998).  Here's the
current Hall of Shame of states with legal barriers to
publicly owned telecom:

 + Arkansas prohibits municipal entities from providing
   local exchange services.  (Ark. Code § 23-17-409)

 + Florida imposes various taxes to increase the prices of
   telecommunications services (as distinguished from other
   services) sold by public entities.  (Florida Statutes §§
   125.421, 166.047, 196.012, 199.183 and 212.08)

 + Missouri bars municipalities and municipal electric
   utilities from selling or leasing telecommunications
   services or telecommunications facilities, except
   services for internal uses; services for educational,
   emergency and health care uses; and "Internet-type"
   services.  (Revised Statutes of Missouri § 392.410(7)

 + Minnesota requires municipalities to obtain a super-
   majority of 65% of the voters before providing
   telecommunications services.  (Minn Stat. Ann § 237.19)

 + Nevada prohibits municipalities larger than 25,000 from
   providing "telecommunications services," as defined by
   federal law.  (Nevada Statutes § 268.086)

 + Tennessee bans municipal provision of paging and
   security service and allows provisions of cable, two-way
   video, video programming, Internet and other "like"
   services only upon satisfying various anti-competitive
   public disclosure, hearing and voting requirements that
   a private provider would not have to meet.  (Tennessee
   Code Ann. § 7-52-601 et seq.)

 + Texas bars municipalities and municipal electric
   utilities from offering telecommunications services to
   the public either directly or indirectly through a
   private telecommunications provider.  (Texas Utilities
   Code. § 54.201 et seq.)

 + Virginia prohibits all localities except the Town of
   Abingdon (the home of a prominent member of Congress)
   from offering telecommunications services of facilities,
   but allows localities to sell the telecommunications
   infrastructure that they had in place on September 1,
   1998, and also allows localities to sell or lease "dark
   fiber" subject to several onerous conditions.  (Virginia
   Code § 15.2-1500)  [Note: Overturned in District Court,
   May 16, 2001]

 + Utah Enacted H.B. 149 during the 2001 session
   establishing many onerous conditions . . . upon any
   municipality seeking to provide telecommunications or
   cable services.  Enacted 3/13/2001

Be alert for a teleban attack on your city or state's right
to own and run its own infrastructure.

[Source: American Public Power Association, provided to the
SMART Letter by Eileen deArmon, Director of Marketing,
World Wide Packets.]

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