Eleven organisations and/or groups of organisations jumped in on the side of challengers to FCC decisions preempting local and state control of public right of way management and ownership of assets, such as streetlight poles, located there.
Five of the amicus curiae – friend of the court – briefs filed with the federal appeals court in San Francisco came from municipal electric utilities and associations representing them. The state of Oregon, an association representing Washington state cities and a group led by New York City offered supporting arguments, and the County of San Diego sent an endorsement letter. The Communications Workers of America and a couple of advocacy organisation filed a brief, as did a tin foil hat group. Links to all are below.
The main arguments they made against the FCC’s pole and right of way preemptions are…
State and local governments operate under a complex web of laws that the FCC has no authority to simply override by decree.
Federal regulations and state laws require governments to “obtain fair market value” when leasing out public property.
Congress specifically barred the FCC from regulating municipal and other publicly owned electric utilities.
The cutest argument came from the Washington state cities. They accused “Daddy Warbucks’ small wireless company, Warbucks Wireless” of “commandeering the City of Whoville”. Both the Grinch and the FCC have until August to file rebuttals.
Nine privately owned electric companies joined together to try to overturn the FCC’s OTMR rules. The group does not include Pacific Gas and Electric, Southern California Edison or San Diego Gas and Electric, California’s major investor-owned utilities. That’s presumably because California has exercised its option under federal law to regulate utility poles itself – the specific federal rules in question don’t apply here. However, the core arguments made against the FCC’s rules could likewise be made against any OTMR requirements that the California Public Utilities Commission might consider in the future.
The key objection is that the FCC’s new utility pole regulations go beyond its authority over telecoms and encroach – literally and figuratively – on electric utility’s (and state regulators’) domain…
The [August wireline decision] dramatically changed course and created a “self-help remedy” to allow new attachers to use a utility-approved contractor to complete required make-ready work above the communications space (including in the electric supply space), when utilities and existing attachers have not met the FCC’s make-ready work deadlines to perform work preparing a pole for a new attachment…
Because [federal law] limits the FCC’s authority only to matters attendant to “pole attachments” and defines the term “pole attachment” in such a way as to exclude attachments made by an electric utility pole owner, the FCC does not have the authority to regulate any equipment maintained by an electric utility.
The 2018 FCC wireless order was a gigabuck early Christmas present to mobile carriers. It gave them the right to use city-owned property in the public right of way, such as street light poles, at below market rates, sharply restricted fees that local government could charge for permits to do so, and limited local discretion over street management and aesthetic standards. And it tightened shot clocks for processing permit applications for (not so) small wireless facilities.
About the only gift the FCC didn’t give mobile carriers was “deemed granted” privileges. Those would have allowed companies to start construction without permission, after shot clocks run out. California has a similar rule, enacted by the legislature, but with more generous time limits.
The FCC has declined to create deemed granted remedies for big, macro cell sites in the past, and the U.S. congress never told them to do it. In a special case created by congress, the FCC did impose a deemed granted remedy, but there’s never been any question that must do so in all cases. If there’s any question, it’s whether the FCC has the general authority to overrule state legislatures in that regard. Nonetheless, the four mobile companies filed an appeal claiming the FCC’s failure to do so was “arbitrary and capricious”.
In their first attempt to justify that claim, the mobile carriers offer page after page of boilerplate 5G hype, and then argued that the FCC’s decision to not give them everything they want had “no rational connection” to the glorious future promised by their eloquent marketing materials.
What the carrier’s intervention did earn them is four tickets in the judicial lottery that determined which appeals court would hear all the challenges, particularly those filed by cities and counties that objected to the substance of the FCC’s preemption order. It worked at first. Sprint’s ticket was pulled and a Denver-based court with a more friendly reputation caught the case. But a legal maneuver by the City of San Jose got it transferred to the ninth circuit federal appeals court in San Francisco, exactly the place AT&T, Verizon and Sprint – and the FCC – were trying to avoid.
The local governments’ argument that the FCC’s wireless and wireline rulings are “arbitrary, capricious and counter to the evidence in the record” boil down to two key points:
Federal law says state and local governments can’t “prohibit or effectively prohibit” deployment of telecommunications services. Courts – including the ninth circuit – have previously ruled that “an ‘effective prohibition’ may not be based upon the mere possibility of prohibition – an actual prohibition is required”. Local regulations and fees that might make a particular small cell site less convenient or less profitable for a carrier are not a prohibition.
“Nothing in the Communications Act gives the Commission authority over non-carrier government property merely because it is convenient to communications providers, or requires a locality to take affirmative action to assist in deployment, either through making its property available, or making it available cheaply”.
The FCC’s claim that it is helping rural communities by preempting urban property rights is equally bogus, according to the local governments’ brief…
If a provider obtains reaps greater profits in San Francisco, Eugene or New York City as a result of preemption of those cities’ current right-of-way or infrastructure attachment fees, those increased profits do not make it more attractive or profitable for the provider to invest in deploying infrastructure in rural Mississippi. The Commission’s order does not require any amount of additional profits resulting from the preemption of San Francisco’s or Eugene’s fees to go towards providing service in other areas. Providers are free to use such additional profits to engage in corporate acquisitions, increase shareholder dividends, or repurchase stocks, which the record shows they have done rather than invest in deployment.
Dozens of local governments from across the U.S. filed joint arguments yesterday with the ninth circuit federal appeals court in San Francisco, as challenges to two 2018 Federal Communications Commission decisions move ahead. Mobile carriers and municipal electric utilities also filed opening briefs. I’ll dive deeper into the arguments in the next few days, but you can read them here now:
A federal appeals court commissioner has, for now, set a schedule that sorts out the various challenges to last year’s Federal Communications Commission decisions that preempted local ownership of streetlights and similar infrastructure, and put tight restrictions on how local governments manage public right of ways. Last week Peter Shaw, a commissioner for the ninth circuit federal appeals court in San Francisco, met with attorneys for local agencies and associations that are challenging various aspects of the order, and with lawyers for mobile carriers that are pretending to be upset with the FCC’s decisions, but are actually jumping in on its side.
The result is a schedule that has the final round of written arguments completed in September, which could lead to a decision in 2020.
If the San Francisco appeals court judges allow the cases to move ahead at all. They still have to decide if they’re going to grant the FCC’s request to put everything on hold until the commission gets around to closing out its proceeding.
Some of the Small Cell Appeals were filed by local governments and publicly-owned utilities (the public petitioners), and separate appeals were filed by various providers of wireless services (industry petitioners). Their positions are in opposition, and industry petitioners, as well as certain intervenors, will support the FCC in opposing the public petitioners, and vice versa.
In a landmark decision, the California Supreme Court gave cities a major victory today, ruling that the way San Francisco regulates the appearance of wireless facilities is legal, and isn’t preempted by state law or California Public Utilities Commission regulations. Its interpretation goes beyond lower court decisions and adopts a narrower view of state-level restrictions on municipal control of telecommunications infrastructure. The unanimous opinion also opened the door to further regulation of cell sites and other telecoms facilities – wired or wireless – by drawing a line between specific limits the legislature put on local oversight of construction activities, and the general ability of cities to set standards for the appearance, placement and, potentially, other aspects of wireless equipment after it’s built.
Today’s California Supreme Court decision endorsed that finding…
Neither the plain language of [public utilities code] section 7901 nor the manner in which it has been interpreted by courts and the PUC supports plaintiffs’ argument that the Legislature intended to preempt local regulation based on aesthetic considerations. The statute and the ordinance can operate in harmony. Section 7901 ensures that telephone companies are not required to obtain a local franchise, while the [San Francisco] Ordinance ensures that lines and equipment will not unreasonably incommode public road use.
But municipal authority goes beyond that, according to the Supreme Court. The ruling said that state law only restricts some of the broad discretion and power that cities have under the California constitution. Cities can’t effectively prohibit telecoms companies from building infrastructure or regulate their operations, but…
The Legislature has not adopted a comprehensive regulatory scheme. Instead, it has taken the limited step of guaranteeing that telephone corporations need not secure a local franchise to operate in the state or to construct local lines and equipment. Moreover, the statute leaves room for additional local action and there are significant local interests relating to road use that may vary by jurisdiction.
Nor does the authority given to the CPUC override local control or responsibilities. The commission regulates “a utility’s relations with its customers”, the decision says, but municipalities “are forbidden from yielding to the PUC their police powers to protect the public from the adverse impacts of utilities operations”…
Consistent with these statutes, the PUC’s default policy is one of deference to municipalities in matters concerning the design and location of wireless facilities. In a 1996 opinion adopting the general order governing wireless facility construction, the PUC states the general order “recognize[s] that primary authority regarding cell siting issues should continue to be deferred to local authorities… . The [PUC’s] role continues to be that of the agency of last resort, intervening only when a utility contends that local actions impede statewide goals … .” The order itself “acknowledges that local citizens and local government are often in a better position than the [PUC] to measure local impact and to identify alternative sites. Accordingly, the [PUC] will generally defer to local governments to regulate the location and design of cell sites … .”
Finally, the Supreme Court said that public utilities code section 7901.1, which puts specific limits on local control of the public right of way, only applies while construction work is going on…
It is eminently reasonable that a local government may: (1) control the time, place, and manner of temporary access to public roads during construction of equipment facilities; and (2) regulate other, longer term impacts that might incommode public road use under section 7901. Thus, we hold that section 7901.1 only applies to temporary access during construction and installation of telephone lines and equipment. Because the City treats all entities similarly in that regard, there is no section 7901.1 violation.
In other words, the requirement that all telecoms companies be treated that same only applies while facilities are being installed. Cities are free to adopt wireless-specific ordinances that apply after construction work is completed.
Bottom line: California cities can set aesthetic standards for cell sites, and have more authority over wireless and wireline infrastructure than they or telecoms companies thought. It’s a comprehensive defeat for T-Mobile, Crown Castle and Extenet, who sued the City and County of San Francisco. They’ll even have to pay San Francisco legal costs.
Although the ruling opens the door to further local regulation of wireless facilities, including stricter aesthetic standards, the extent of that discretion wasn’t defined, and there are still federal preemptions of state and local authority that could apply. But today’s decision gives California cities a green light to test those limits.
My clients are mostly California cities, all of whom are directly affected by this case. I’m not a disinterested commentator. Take it for what it’s worth.
San Franciso’s aesthetic standards for cell sites are legal under California law. The California Supreme Court rejected an appeal by T-Mobile, Crown Castle and Extenet of lower court rulings that allowed the City and County of San Francisco to regulate the appearance of cell sites. The ruling, posted minutes ago, is here. The ruling is broader than the lower courts’ opinions, though, and appears to expand the scope for local governments to control the use of public right of ways and issue permits for wireless facilities. More to come…
The federal appellate court review of two Federal Communications Commission rulings that preempt local authority over wireless attachment and wireline excavation permits, and take away local ownership of streetlight poles and similar property will continue, albeit slowly. Yesterday, the ninth circuit court of appeals in San Francisco refused to ice the case completely, as requested by the FCC and as dutifully echoed by wireless carriers.
Instead, the court consolidated the twelve separate appeals of the September wireless attachment order into a single case, and assigned it to the same set of judges who will consider two appeals of the August wireline excavation order. A “special master” was given the job of sorting out the nuts and bolts of consolidating the twelve challenges to the wireless attachment ruling, and combining them with the two wireline excavation appeals.
Conduct a case management conference with the parties. The special master shall consider any issues he deems appropriate to manage the petitions effectively, including but not limited to the development of a briefing plan for the above-listed twelve petitions. The case management conference will be scheduled by separate order of the special master…
Proceedings in these consolidated petitions other than the case management conference are stayed pending the case management conference.
There are what amount to three interlocking cases in play. The cities, counties and associations challenging the September wireless order say that the FCC overstepped its authority in many regards, especially when it declared that municipal poles and other structures in the public right of way don’t belong to the agencies that installed them. The ones challenging the August wireline order make similar arguments about a blanket preemption of local rules regarding when telecoms companies can dig in the street, including seasonal restrictions – working on ice covered streets during spring freeze/thaw cycles, for example, can turn a nice stretch of asphalt into a dirt road.