Verizon mounts dubious legal assault on pole rental fees in Rochester

by Steve Blum • , , , ,

Rochester street light

Verizon is using a legally shaky ruling by the Federal Communications Commission to shake down the City of Rochester, New York. Last year, the FCC ruled that publicly owned property, such as light poles or traffic signals, located in the public right of way were, in fact, part of the public right of way and not municipal property.

Rochester wants to charge Verizon up to $1,500 a year in rental fees for the use of city-owned poles in the public right of way. That’s considerably more than the FCC’s “safe harbor” rental rate of $270 per pole per year. So Verizon filed a lawsuit against the City of Rochester in federal court (h/t to Jon Brodkin at Ars Technica for the pointer.

The problem with Verizon’s claim is that the FCC has already cut the legs out from underneath it. In its filing, Verizon described the FCC’s $270 figure as a “presumptively reasonable limit”.

Unfortunately for Verizon, in its defence of its pole preemption ruling in a San Francisco-based federal appeals court, the FCC said that “there is no presumption that fee amounts outside the safe harbor are impermissible or preempted. A safe harbor is not a ceiling”.

Rochester’s initial response to Verizon’s objections was “we have concluded that our permit fees and recurring fees for use of the City’s rights of way, including those for pole attachments related to the deployment of small wireless facilities, comply with all federal law requirements and limitations”.

Hardball of this sort is part of Verizon’s style. In North Little Rock, Arkansas, Verizon sent a similarly threatening letter to the city, telling it to tear up a master lease agreement that had already been negotiated and agreed by both sides. I’ve seen it take the position that attaching a small cell to a publicly owned light pole should cost no more than attaching a fiber optic cable to a privately owned utility pole – something in the neighborhood of $25 per year in California, according to a formula set by the California Public Utilities Commission.

Threats and lawsuits might scare some cities into giving Verizon what it wants. But the decisive battle is being fought in San Francisco, and so far it doesn’t look like Verizon will end up on the winning side.