PG&E pole attachment shot clock ready for another CPUC vote

by Steve Blum • , , ,

Fiber attachments 625

The do-over of a settlement resolving a utility pole attachment dispute between Pacific Gas and Electric and Crown Castle is queued up at the California Public Utilities Commission. The original settlement was drafted by administrative law judge Patricia Miles and approved in March. But commissioners reversed the decision due to procedural mistakes, and told Miles to fix those errors try again. She did, and the new draft is the same as the old one.

If approved, the imposed settlement gives PG&E forty five days to “provide a response” to a pole attachment request from Crown Castle. If there’s no response, Crown Castle can go ahead with its proposed work. “Response” is not defined, but typically it means a yes or no answer, including any specs for work that’s needed to make the pole ready for a new line to be attached. Whether PG&E’s lawyers go with the typical meaning or try to craft one of their own remains to be seen.

The draft also bakes in the rejection of Crown Castle’s original request to be allowed to buy attachment space on PG&E’s poles, rather than just lease it. PG&E’s practice is to either sell ownership of the entire communications zone – the segment of the pole that’s high enough off the ground and sufficiently beneath electric lines – or lease it by the foot. Typically (there’s that word again) AT&T or another incumbent telco buy the entire zone and manage it under private joint pole rules that are, in theory, friendlier to telecoms companies. Crown Castle wanted those privileges for its one-foot of pole space, but didn’t want the responsibility of managing the entire zone.

PG&E opposes the changes proposed by Miles. It doesn’t like the way it was handled – the dispute between the companies was fast tracked as an arbitration, rather than a typical, and lengthy, litigation – and it objects to what it characterises as special treatment given to Crown Castle.

Crown Castle generally endorsed Miles’ decision, albeit after making clear that they think they should have been given the right to buy space by the foot on poles, and after asking for one change – removal of a requirement that they provide two days notice to PG&E before doing work on poles.

The commission is scheduled to vote on the proposed settlement at its meeting next week, but don’t be surprised if it gets bumped. PG&E and Crown Castle have one more round of comments to file, and if any of their arguments gain traction with Miles or commissioners, then new language would have to be drafted.

Net neutrality ruling sinks FCC local pole ownership preemption theory

by Steve Blum • , , , ,

Although a federal appeals court in Washington, D.C. blessed the Federal Communication Commission’s “2018 Order” repealing network neutrality rules, the judges hearing the case overturned one section that tried to preempt any effort by state or local governments to step into the gap. If the plain language of Tuesday’s opinion is also applied to the FCC’s attempt to preempt local ownership and control of street light poles and other publicly owned assets located in the public right of way, then it’s a slam dunk bet that it’ll be overturned too.

Last year, the FCC issued two far reaching decisions preempting nearly all state and local authority over construction of broadband infrastructure, one dealing with small cell sites and the other dealing primarily with wireline projects. It claimed the authority to do so based on an expansive interpretation of federal communications law that boiled down to we’re in charge of national broadband policy, so what we say goes for everyone.

“No dice”, said the D.C. appeals court. Its opinion made two particular points: 1. congress never gave the FCC the necessary authority to occupy policy territory that legally belongs to states, and 2. if the FCC wants to exercise the authority it does have, it has to do so case by case, by the evidence…

Not only is the Commission lacking in its own statutory authority to preempt, but its effort to kick the States out of intrastate broadband regulation also overlooks the Communications Act’s vision of dual federal-state authority and cooperation in this area specifically. Even the 2018 Order itself acknowledges the States’ central role in “policing such matters as fraud, taxation, and general commercial dealings…remedying violations of a wide variety of general state laws,” and “enforcing fair business practices” — categories to which broadband regulation is inextricably connected…

We have long recognized that “whether a state regulation unavoidably conflicts with national interests is an issue incapable of resolution in the abstract,” let alone in gross…

Because a conflict-preemption analysis “involves fact-intensive inquiries,” it “mandates deferral of review until an actual preemption of a specific state regulation occurs.” Without the facts of any alleged conflict before us, we cannot begin to make a conflict-preemption assessment in this case, let alone a categorical determination that any and all forms of state regulation of intrastate broadband would inevitably conflict with the 2018 Order.

The ninth circuit federal appellate court in San Francisco is hearing the challenges to the FCC’s blanket preemption of local and state authority over right of ways and public property. It’s not obligated to follow the D.C. circuit’s opinion, but given that it has a history of being even more skeptical of federal agency supremacy than its Washington colleagues, it’s heavy odds that it will.

Hope for California’s net neutrality law, as court upholds repeal of federal rules

by Steve Blum • , , , ,

Open internet dont tread on me 2

The Federal Communications Commission’s republican majority acted properly and within the limits of its authority in 2018 when it cancelled network neutrality rules approved in 2015 by the then-democratic controlled FCC. Mostly. A three judge panel on the federal appellate court based in Washington, D.C. – aka the DC circuit – issued its opinion yesterday, providing support for California’s enactment of its own net neutrality rules, but otherwise rejecting most of the arguments made by net neutrality advocates.

But not all. The judges overturned “the portion of the 2018 [FCC] order that expressly preempts ‘any state or local requirements that are inconsistent with its deregulatory approach’”. That action could open the door to state-level net neutrality regulations, similar to what the California legislature enacted last year when it approved Senate Bill 822.

The ink on governor Jerry Brown’s signature was barely dry, when a plague of lobbyists and lawyers descended on Sacramento and challenged the new law in federal court. Yesterday’s ruling removes a major pillar of their case – the FCC’s attempt to specifically preempt state-level action – but they still have a general argument to make, based on federal authority over interstate commerce. Winning that argument will be harder though, because the D.C. circuit opinion resolves a regulatory paradox in California’s favor.

Following the decision, the bill’s author, state senator Scott Wiener, tweeted “SB 822 remains intact & isn’t preempted”.

Even so, SB 822 is in limbo. California attorney general Xavier Becerra agreed not to enforce it while the case against the FCC’s net neutrality repeal was underway. Yesterday’s decision is a major milestone, but not necessarily the last word. Becerra issued a press release claiming victory, but it didn’t mention what he plans to do about reviving and defending SB 822.

The appeals court judges also said the FCC has to flesh out some aspects of its net neutrality decision in light of public safety, pole attachment and lifeline program considerations, ruling in some specific respects the agency’s actions were “arbitrary and capricious”. That’ll be a paper-pushing exercise; any changes that result will almost certainly be minor.

But other than that, the D.C. circuit panel said that the FCC’s rollback of net neutrality rules will stand.

The judges cited more than 20 years of precedent – and back-and-forth FCC decisions – regarding how broadband service is or isn’t regulated. The central question was whether congress gave the FCC the authority to make such decisions, and the judges’ answer is yes. They pointed out that they “do not inquire as to whether the agency’s decision is wise as a policy matter; indeed, we are forbidden from substituting our judgment for that of the agency”. The FCC’s decision has to be “reasonable”, though, and the judges determined that it was. Much of the nearly 200 pages of the opinion was devoted to explaining why. One recurring theme was that, in many respects, the republican-majority FCC simply restored previous, widely accepted rules overturned by the democratic-majority in 2015. The judges also rejected arguments that, as a whole, the FCC’s decision was arbitrary and capricious, although they said in some respects the commission’s work “is no model of agency decision making”.

Yesterday’s decision can be appealed, either directly to the federal supreme court, or by asking all the judges assigned to the D.C. circuit to review en banc the ruling made the opinion of the three judge panel. It could yet be a long time before we get a final answer.

Salinas, AT&T sign master pole license agreement with small cell design standards and $750 annual rent, sorta

by Steve Blum • , , , ,

Downtown salinas

AT&T and the City of Salinas hedged their bets and signed a master license agreement for attaching small cell sites to city-owned poles that complies with current Federal Communications Commission guidelines, but snaps back to market-based fees if those rules are changed, or overruled by a federal court.

Last year, the FCC declared that municipal assets installed along roads or otherwise in the public right of way, like street light poles or traffic aren’t really city (or county) property, but instead are part of the right of way itself. In California, that would mean that mobile broadband companies could hang wireless antennas and other equipment on street lights at will, simply by filing for an encroachment permit. The FCC said any fees have to based on cost, not market prices, and it decided that $270 per year is what a city’s costs should be. It has since backed away from some of the restrictions it wants to impose, as it defends its ruling against lawsuits filed by dozens of cities.

Under the terms of the deal, if the FCC’s preemption of local street light pole ownership survives the federal appellate court challenge underway in San Francisco, then AT&T will pay the City of Salinas a “monitoring fee” of $270 per pole per year to install “small wireless facilities”. If it’s overturned, then a license fee will kick in, raising the yearly total AT&T has to pay Salinas for each pole to $750 for the first year, with a 2.5% annual increase in the license fee portion after that.

$750 per year falls in the middle of the average range for city pole rental fees in California, although it’s less than typical rates in the San Francisco Bay Area, which tend to be in the $1,500 per year ballpark. Unless the ballpark is in San Francisco proper – $4,000 is common there.

AT&T also agreed to follow particular construction standards for small cell installation on city-owned poles. It will…

  • Follow the City of Salinas’ small cell design standards, which limit antenna enclosures to twice the width of and no more than 20% higher than an existing pole, require equipment to be located underground or mounted on poles, and set standards, including anti-graffiti measures, for screening everything.
  • Cooperate with the City on pre-approval of standard small cell designs that can then be deployed quickly and widely.
  • Not install small cell facilities on traffic lights, or any pole “supporting signs or devices used to control or direct…traffic”.
  • Abide by the City of Salinas’ Dig Once policy, which could require AT&T to use existing conduit or fiber routes in some circumstances, and allows notices to go out to other companies that might be interested in participating in projects that involve excavating city streets.

It’s City policy to support 4G mobile network upgrades and 5G deployments so “Salinas businesses can remain economically competitive” and “residents have the ability to access resources (including educational resources) that are available through the Internet”. Its efforts aren’t limited to promoting better mobile service. As part of its Dig Once program, the City installs conduit in its own road projects and made broadband infrastructure upgrades a top priority for its economic development initiatives, particularly in Salina’s Ag Tech Corridor and downtown area.

I’m a consultant to the City of Salinas and assisted with the development of its broadband policy and agreements. I’m not a disinterested commentator. Take it for what it’s worth.

Master License Agreement for Wireless Installations on Public Structures, by and between the City of Salinas and AT&T, 13 August 2019
City of Salinas, City Council Resolution, Authorising Mayor to Sign AT&T Master License Agreement, 13 August 2019
City of Salinas, Staff Report, License of City Facilities for Small Cell Sites, 13 August 2019

City of Salinas, City Council Resolution, Small Wireless Facility Regulations, 2 April 2019
City of Salinas, City Council Resolution, Small Wireless Facility Fees, 2 April 2019
City of Salinas, Staff Report, Small Wireless Facility Regulations and Fees, 2 April 2019

City of Salinas, City Council Resolution, Wireless Telecommunications Facility Lease Policy, 17 April 2018
City of Salinas, City Council Staff Report, Wireless Telecom Leasing Policy, 17 April 2018

City of Salinas, City Council Resolution, Policy Reducing Underground Excavation for Communications Infrastructure within the City Right Of Way, 15 November 2016
City of Salinas, Staff Report, Reducing Underground Excavation for Communications Infrastructure within the City Right Of Way, 15 November 2016

Sprint took megabuck subsidies for inactive lifeline customers, federally and in California

by Steve Blum • , , , ,

Sprint mwca 2018

Sprint could be collecting payments from California’s broadband and telephone lifeline subsidy program for hundreds of thousands of inactive accounts. A Federal Communications Commission press release accuses Sprint of taking “tens of millions of dollars” for 885,000 federally subsidised customers who weren’t using the service anymore. That represents 30% of Sprint’s national lifeline customer base, says the FCC.

Sprint is the 500 pound gorilla of the California Public Utilities Commission’s lifeline program, which supplements the $9.25 monthly federal subsidy with up to $15 per month. According to a brief submitted by the CPUC’s public advocates office during the ongoing review of Sprint’s proposed merger with T-Mobile…

Sprint, through its Virgin Mobile brand, is the only [facilities-based mobile network operator] that participates in the California LifeLine program. Under the trade name of “Assurance Wireless brought to you by Virgin Mobile,” Virgin Mobile serves roughly 482,000 LifeLine wireless customers in California, over 200,000 more customers than the next largest LifeLine wireless carrier, and more than all other LifeLine wireline carriers combined.

If the FCC’s 30% “inactive” rate applies equally to Sprint’s California lifeline base, then the CPUC gave the company subsidies for 145,000 non-existent customers. There isn’t enough information available yet to figure out how much money that represents, but on a back of the envelope basis, 145,000 inactive accounts subsidised at $15 each comes out to about $2.2 million per month. Even given that every payment wasn’t the $15 max, it doesn’t take too many months for California’s outlay to land in the FCC’s “tens of millions of dollars” ballpark too.

The Communications Workers of America union is one of the leading opponents of the T-Mobile/Sprint merger, in California and federally, and has already asked the FCC to put everything on hold “until [Sprint’s corporate] character issue is investigated and resolved”. It’s a fair bet that T-Mobile and Sprint will have to answer for the false billing – Sprint is calling it an “error” dating back to 2016 – as they try to gain CPUC approval for their merger. A hearing to decide next steps in the case is scheduled at the CPUC on 10 October 2019.

CPUC approves DSL upgrade subsidy for Frontier at $4,700 per home

by Steve Blum • , , , ,

Weimar casf project

The California Public Utilities Commission approved a $693,000 grant to Frontier Communications from the California Advanced Services Fund (CASF) for a DSL equipment upgrade in the Placer County community of Weimar earlier this month. It was a considerably smaller grant than Frontier requested.

The project originally included the somewhat larger town of Colfax and called for a CASF subsidy of $2.3 million to reach 1,400 homes that, Frontier said, lacked access to broadband service at California’s pathetic minimum of 6 Mbps download and 1 Mbps upload speeds. Other Internet service providers in the area begged to differ, however. Two wireless ISPs, Colfax.net and SmarterBroadband, which have made a habit of blocking wireline upgrades, challenged Frontier’s request, as did the local cable operator, Wave. As a result more than two-thirds of the budget and nearly 90% of the households were chopped, and the cost jumped to $4,700 per premise…

Staff notes that this is a DSL project, and the cost would be higher compared to other DSL projects approved by the Commission. The total number of households for this project is 148, which is significantly less compared to other Frontier DSL projects that range from 234 to 1,017 total households. The higher cost per household is due to the low density of eligible households in the project area. Further, in addition to the equipment upgrades to the Weimar Central Office, Frontier must also upgrade equipment facilities at its Colfax Central Office in order to serve the Weimar project area. Due to the additional equipment upgrades required in Colfax, the cost per household increased by $1,000 overall.

Frontier gave up federal money for the area, in order to maximise its Californian subsidy, which covers 90% of the construction cost for the DSL central office upgrade and 1,000 feet of new fiber, apparently for a lateral connection to a middle mile route. Frontier is only promising the minimum performance level for CASF funded projects of 10 Mbps down/1 Mbps up, but CPUC staff “estimates 50 percent of CASF-eligible households are within roughly 5,000 feet of Frontier’s terminals and should expect very fast service (25 Mbps to a maximum of 115 Mbps)”.

Frontier’s financial woes rated a mention, but didn’t raise any concerns. The CPUC resolution concluded that Frontier “has managed to stabilise its revenue and made significant efforts to reduce debt and improve its financial leverage profile”.

Proposed California initiative would toughen and lock in consumer privacy rules

by Steve Blum • , ,

The man behind California’s new privacy law doesn’t like what lobbyists are trying to do to it in Sacramento, and plans on taking his case directly voters. In 2018, Alastair Mactaggart and his organisation – Californians for Consumer Privacy – collected enough signatures to get a tough privacy law on the ballot, but withdrew the initiative after a deal with was cut with lawmakers to enact most of its provisions. But anything the legislature can do, it can also undo, so Mactaggart is going back to the voters. According to the initiative’s text, filed with the California attorney general’s office yesterday…

Even before the [California Consumer Privacy Act] had gone into effect, however, businesses began to try to weaken the law. In the 2019–20 legislative session alone, members of the Legislature proposed more than a dozen bills to amend the CCPA, and it appears that business will continue to push for modifications that weaken the law. Unless California voters take action, the hard-fought rights consumers have won could be undermined by big business.

If enough valid signatures are collected and it’s approved by Collected voters, the initiative would generally tighten restrictions on the kind of personal information that businesses can collect from consumers and required them to disclose, in advance, “the specific purposes” for which the data will collected or used, and to go back and notify consumers if they want use the information for other reasons. It would ban the collection of personal information from children less than 13 years old without parental permission, and from teenagers between 13 and 16 without their permission. Consumers all ages would gain the right to demand that a business delete or correct personal information, within limits, even if it was collected with permission.

The initiative would also create the “California Privacy Protection Agency”, with an initial budget of $5 million a year. It would be run by a five person, politically appointed board, and have the “power to audit a business’s compliance” with the new privacy law, including the authority to subpoena “books, papers, records or other items”. The agency could issue fines for violations.

If passed, the California legislature’s ability to water down the initiative’s provisions would be severely limited. Mactaggart needs signatures from more than 600,000 registered voters to get it on the 2020 ballot.

Fewer complaints, so far, as California utilities cut power to reduce wildfire risk

by Steve Blum • , , , ,

Update: PG&E shut off power this morning, as previously announced. As of this evening, it had restored power in north Bay Area counties, and some of the affected Sierra foothill communities. SCE turned power back on for the Riverside County homes affected by Tuesday’s cuts. Public reaction to PG&E de-energisation moves remained as relatively muted as it did on Tuesday. The San Francisco Chronicle spoke to one upset Sonoma County supervisor, but on the whole there was very little NIMBY outrage.

Forecasts of high winds and hot temperatures this week led two of California’s major privately owned electric utilities to implement de-energisation plans that were drafted earlier this year. Californians’ acceptance of “public safety power shutoffs” as a necessary fire prevention tool appears to be growing, although we’ll find out today if residents of the more affluent communities of the north San Francisco Bay Area are as tolerant as people in the Sierra foothills.

PG&E announced that it is turning off power this morning to 48,000 customers in Butte, Napa, Nevada, Placer, Plumas, Sonoma and Yuba. That follows cut offs in Butte, Nevada and Yuba counties for 24,000 customers that began Monday evening. Restoration of service to the first group was supposed to be completed yesterday evening. As of last night, Southern California Edison had turned off power for a few dozen customers in Riverside County, and put a 140,000 more across the Southland on notice.

San Diego Gas and Electric customers are not affected, so far.

People who live in Sierra foothill communities have more directly personal memories of the horrific fire that killed 86 people and largely destroyed the town of Paradise in Butte County last year. So they might not be happy about losing power, but they did not seem to erupt in outrage as some Wine Country residents did last October. That’s progress.

The Sacramento Bee found one Butte County resident who was annoyed. She was interviewed at one of the “community resource centers” that PG&E set up, basically a big tent with air conditioning and plenty of outlets to charge phones. Judging by the video shot by Bee reporter Daniel Kim, few people were inconvenienced enough to make use of it.

That was the only kvetching that turned up in a Google news search as power was being restored yesterday afternoon, and only a relative handful of people took to Twitter to complain. PG&E is a particular punching bag on Twitter: the proactive power cuts didn’t add much to the vitriol that’s regularly directed at the company. But there’s a somewhat different group of people affected today. Stay tuned.

FCC’s weed whacker work fails another court test

by Steve Blum • , , , ,

The Federal Communications Commission’s republican majority is now 0 for 2 in federal appeals court challenges to its weed whacker campaign to prune back telecommunications and media regulations. In an opinion released yesterday, the third circuit federal appeals court, based in Philadelphia, voted 2 to 1 to overturn an FCC ruling that loosened restrictions on media ownership, because republican commissioners blew off concerns about the effect it would have on women and minorities. In August, Washington, D.C.-based federal appellate judges overturned an FCC decision that scrapped environmental reviews for small cell site, saying it was “not logical and rational”.

The Philadelphia judges were likewise scathing in their criticism of the process, or lack thereof, that the FCC used in reaching its decision. It’s the second time in two months that federal appellate judges have rejected a controversial, party line FCC ruling because the republican majority did not do its homework…

Problems abound with the FCC’s analysis. Most glaring is that, although we instructed it to consider the effect of any rule changes on female as well as minority ownership, the Commission cited no evidence whatsoever regarding gender diversity…

Even just focusing on the evidence with regard to ownership by racial minorities, however, the FCC’s analysis is so insubstantial that it would receive a failing grade in any introductory statistics class.

The case has to do with how many TV stations a single company can own, and whether a company can own a TV station and a newspaper in the same media market. It’s not an issue I follow closely, so if you want more background on it, take a look at this story on CNET by Marguerite Reardon.

The court’s opinion has broader significance, because it shows an increasing lack of deference to the FCC’s supposed policy expertise and decreasing tolerance for sloppy decision making that begins with an idealogical conclusion and then supports it with sophomoric legal arguments rather than basing it on the evidence in the record. Appellate court challenges to two more FCC rulings – one rolling back Obama-era network neutrality rules and the other preempting local ownership of street light poles and similar infrastructure in the public right of way – are based on similar grounds. A ruling on the net neutrality case could come at any time. The appeals of the right of way decisions still have several months, at least, to run.

T-Mobile waters down California job pledge as it refiles for Sprint merger permission

by Steve Blum • , , , ,

Tmobile san francisco 18may2019

T-Mobile (and Sprint, but it’s T-Mobile running the show) refiled and amended its application for merger approval with the California Public Utilities Commission on Thursday, as directed by the administrative law judge managing the case. Generally, the changes add a bit more detail about how the settlement T-Mobile reached with the federal justice department’s antitrust enforcers changes the promises it made to the CPUC earlier in the proceeding.

The core of the settlement involves transferring most of Sprint’s prepaid customers, along with retail outlets, cell sites and spectrum, to DISH, in order to create a new competitor in the mobile broadband market. The new commitments in the amended application boil down to we’re not making any promises about what DISH will do with the stuff.

Or with the people. Since some of Sprint’s employees –“prepaid asset personnel” – will be offered as a sacrifice to DISH, T-Mobile is removing them from its “voluntary commitment” to “extend job offers with comparable pay and benefits to all California Sprint and T-Mobile retail employees”.

If you read between the lines, though, it’s also possible – probable, if you assume T-Mobile’s lawyers use weasel words for a reason – many Sprint and/or T-Mobile employees will end up out of work, whether or not they’re being shopped to DISH.

On the one hand, T-Mobile originally promised “the total number of New T-Mobile employees in California three years after the close of the transaction will be equal to, or greater than, the current total number of Sprint and T-Mobile employees in California”. The amended application removes the “prepaid asset personnel” from that commitment and restates it as “no net job loss”, which indicates that the “or greater than” is weaselly worded indeed.

On the other hand, T-Mobile says it will create “approximately one thousand new jobs at a new customer experience center located in California’s Central Valley”.

Do the math. If T-Mobile adds a thousand people in Kingsburg, in Fresno County, and its Californian head count will be the same in three years as it is now, a thousand employees will have to make a career change. That might be a sound business decision, but it’s not the storyline T-Mobile is hoping the CPUC will buy into.

The next milestone in the CPUC’s lengthening review of the T-Mobile/Sprint merger is a hearing to consider what additional issues need to be addressed, and what the schedule for doing that will be. Given typical procedural timelines at the CPUC, a final decision isn’t likely until next year, perhaps some time in the first three months or so.

Links to the stack of arguments and exhibits T-Mobile and Sprint filed on Thursday are here.