HomeMy WebLinkAboutAgenda Report - July 6, 1983 (52)City Clerk Reiinche presented a letter and report which had
been received from Mayor Paul E. Zeltner, U.S. Conference of
Mayors Cable Task Force regarding the S.66 Fan Out Network.
No formal action was taken by the Council on the matter.
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1. (• 1 (-•r•t DeBaun
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P;Wl F. 7..•itner
Alavrrr
M E M O R A N D U M
TO Mayor and Council
City Manager
City Clerk (In Non -Manager Cities)
RECEIVED
::- JUN 23 P4 Its 21
116
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(•omiril tilr tuber
ALICE M. IWIMrifiptnMwrt G. Wagner
CITY CLERK .,rrrnr.rlAlrrnbrr
CITY OF 1.001
FROM Mayor Paul E. Zeltner
U.S. Conference of Mayors Cable Task Force
DATE : June 21, 1983
SUBJECT : S.66 FAN OUT NETWORK REPORT
Action Requested
Please:
1. Write Representatives Jim Bates, Carlos Moorhead Henry Waxman and your
own Congressman in support of U.S. Conference amendments and additional
House Telecommunications Subcommittee hearings on S_66, including a
California field hearing.
2. Complete the attached "S.66 Network for Local Cable Authority" if you
wish to continue to receive and act on our S.66 Fan Out Network Report.
3. Write U.S. Senator Pete Wilson thanking him for his support of
California cities during the U.S. Senate debate on S.66.
4. Request your local educational agencies, local cable access producers
and religious organizations to contact your Congressman in support of the
proposed U.S. Conference of Mayors amendments to S.66.
Background and Developments
The U.S. Senate passed S.66 last Tuesday, on a lopsided 87-9 vote. The
one-sided vote reflects last-minute concessions to individual Senators to
protect their local cities. Among the most successful concessions were a
package obtained by California U.S. Senator Pete Wilson:
* The California rate deregulation law is grandfathered as a substitute
for the one-sided federal regulation law contained in S.66.
* California cities that levy a utility users' tax on cable may continue
505e N. Clark Ave., r O. Sox 158. Lakewood, CA 90714 213/866-9771-213/773-2964
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4
S.66 Fan Out Report
to do so.
June 20
* Cable companies may not apply for a franchise extension -- and thereby
end the limited grandfathering of facilities and equipment in S.66 --
until three years before the end of their franchise.
Senator Wilson should be thanked for his support of California cities.
The Revised S.66
Attached is the Senate -passed version of S.66.
The Votes
Here's how our U.S. Senators voted on key S.66 amendments:
* The AT 6 T amendment subjecting cable companies to competition from
local telephone companies for the transmission of data and two-way
telecommunications:
Aye: Cranston
No: Wilson
* "True Grandfathering" of Franchises
No: Cranston and Wilson
* Removal of Presumption of Franchise Renewal
No: Cranston and Wilson
* Retention of Local Rate Regulation
No Cranston and Wilson
* Final Passage
Yes: Cranston and Wilson
It is important to note that Wilson got "trade offs" in favor of
California cities in return for his votes for S.66. Senator Cranston did
not.
The success of the. Wilson Amendment shows what improvements can occur
through our joint action.
S.66 Fan Out Report June 20
A
On a unanimous vote, the attached resolution was adopted by the U.S.
Conference of Mayors last Denver. The U.S. Conference will mount a major
effort to obtain a House of Representative cable bill in favor of local
authority and consumer protection.
The House Fight
The key decision makers in the Nouse are the members of the House Energy
and Commerce Subcommittee on Telecommunications. California members are
Henry Waxman, Carlos Moorhead and Jim Bates.
It is essential that you contact these members -- plus your local
Congressman -- in support o- U.S. Conference of Mayors amendments to S.66.
The amendmicntn :are:
* "True gra.ndfatheritg" of the terms and conditions of existing
franchises. which weri freely negotiated.
* Retention of the bas's service definition contained in local franchises,
rather than the "first `f.er" definition included in S.66.
* Retention of the Wilson Amendment :substituting the California rate
deregulation law for the S.66 rate provision.
* Removal of the 5.66 presumption or expectancy of renewal on the part of
a cable company holding a franchise. Rather, the U.S. Conference proposes
a "fair renewal process."
* Elimination of the S.66 "escape clause," permitting cable operators to
remove services, facilities and equipment based on an unilateral assertion
of "a significant change of circumstances" since the franchise enactment.
* Authority for local governments to mandate public, educational and
governmental access to cable r_ommun-icat;c os systems.
* Elimination of the 5.66 provision, that limits the ability of local
governments to negotiate the purchase price of a cable system if there is
a material breach in the franchise agreement.
National League of Cities Action
Despite the NLC leadership support of S.66, the NLC Communications and
Transportation Committee has recommended that NLC not oppose any member
city or state league (such as the League of California Cities) from
seeking S.66 amendments in the House on "true grandfathering" and
"competitive renewal processes."
The NLC rommittee also criticized Mayor Royer for violating the NLC policy
development process in negotiating the final terms of the "compromise"
with the National Cable Television Association. The Committee reiterated
...�yT ._�.>,�. ,•x..-n.w••... .•,_--.,... r. -,-.;.e- ,'^:•K pro•;"', �. i,: "'..Ka �?'wr.: �a!sewrq�.'rOueY.
S.66 Fan Out Report June 20 ,1983
its earlier opposition to 5.66.
S.66 California Network
If you wish to continue to receive this fan out report, please complete
the attached form and return it to us.
Further Information
Don't hesitate to contact me or Jim Barnes or Mike Stover of our staff
(phone 213x866-9771) or Len Simon of the U.S. Conference of Mayors (phone
202x293-7330) if you have any questions.
i.. R E C fl
(: �,..,•, t�`Eia„n ICE K I MCNE
(uurtffr SlfrghPr CITY CLERK
CITY OF LOCI
Paul F.. Zeltnry
Ala vor
M E M O R A N D U M
TO Mayor and Council
City Manager
City Clerk (In Non -Manager Cities)
FROM Mayor Paul E. Zeltner
U.S. Conference of Mayors Cable Task Force
DATE June 21. 1983
SUBJECT : S.66 FAN OUT NETWORK REPORT
Action jSqRested
Please:
Lam Van Nostran
Cowird Member
Robert G. Wagner
Coarser/ .11embfr
1. Write Representatives Jim Bates, Carlos Moorhead, Henry Waxman and your
own Congressman in support of U.S. Conference amendments and additional
House Telecommunications Subcommittee hearings on S.66, including a
California field hearing.
2. Complete the attached "S.66 Network for Local Cable Authori-ty” if you
wish to continue to receive and act on our S.66 Fan Out Network Report.
3. Write U.S. Senator Pete Wilson thanking him for his support of
California cities during the U.S. Senate debate on S.66.
4. Request your local educational agencies, local cable access producers
and religious organizations to contact your Congressman in support of the
proposed U.S. Conference of Mayors amendments to S.66.
Background, and Developments
The U.S. Senate passed S.66 last Tuesday, on a lopsided 87-9 vote. The
one-sided vote reflects last-minute concessions to individual Senators to
protect their local cities. Among the most successful concessions were a
package obtained by California U.S. SenAtor Pete Wilson:
* The California rate deregulation law is grandfathered as a substitute
for the one-sided federal regulation law contained in S.66.
* California cities that levy a utility users' tax on cable may continue
Lake"ocd
5050 N. Clark Ave., P. Q. Box 158, i.akewcx d, CA 90714 213/866-9771-213/773-2964
., .:...._.... .. _.. .-"`«+S� x. .;x� � �r,.. • : ,�-.'.;..' :.; .: : � � er'.�.r:K`� .. (m!.j�flr�!.yq.+*5 _w-•• r.-r•-yp;�.'!t+'.� 4r'. tr?+�;�e!-F,o x�-„ny.•ca�l�s
v .
S.66 Fan Out Report June 20
to do so.
* Cable companies may not apply for a franchise extension -- and thereby
end the limited grandfathering of facilities and equipment in S.66 --
until three years before the end of their franchise.
Senator Wilson should be thanked for his support of California cities.
The Revised S.66
Attached is the Senate -passed version of S.66.
The Votes
Here's hew our U.S. Senators voted on key S.66 amendments:
* The AT & T amendment subjecting cable companies to competition from
local telephone companies for the transmission of data and two-way
telecommunications:
Aye: Cranston
No: Wilson
* "True Grandfathering” of Franchises
No: Cranston and Wilson
* Removal of Presumption of Franchise Renewal
No: Cranston and Wilson
* Retention of Local Rate Regulation
No: Cranston and Wilson
* Final Passage
Yes: Cranston and Wilson
It is important to note that Wilson got "trade offs" in favor of
California cities in return for his votes for S.66. Senator Cranston did
not.
The success of the Wilson Amendment shows what improvements can occur
through our joint action.
0-1
S.66 Fan Out Report June 20
On a unanimous vote, the attached resolution was adopted by the U.S.
Conference of Mayors last Denver. The U.S. Conference will mount a major
effort to obtain a House of Representative cable bill in favor of local
authority and consumer protection.
The House Fight
The key decision makers in the House are the members of the House Energy
and Commerce Subcommittee on Telecommunications. California members are
Henry Waxman, Carlos Moorhead and Jim Bates.
It is essential that you contact these members -- plus your local
Congressman -- in support of U.S. Conference of Mayors amendments to S.66.
The amendments are:
* "True grandfathering" of the terms and conditions of existing
franchises, which were freely negotiated.
* Retention of the basic service definition contained in local franchises,
rather than the "first tier" definition included in S.66.
* Retention of the Wilson Amendment substituting the California rate
deregulation law for the S.66 rate provision.
* Removal of the S.66 presumption or expectancy of renewal on the part of
a cable company holding a franchise. Rather, the U.S. Conference proposes
a "fair renewal process."
* Elimination of the S.66 "escape clause," permitting cable operators to
remove services, facilities and equipment based on an unilateral assertion
of "a significant change of circumstances" since the franchise enactment.
* Authority for local governments to mandate public, educational and
governmental access to cable communications systems.
* Elimination of the 5.66 provision that limits the ability of local
governments to negotiate the purchase price of a cable system if there is
a material breach in the franchise agreetrent.
National League of Cities Action
Despite the NLC leadership support of S.66, the NLC Communications and
Transportation Committee has recommended that NLC not oppose any member
city or state league (such as the League of California Cities) from
seeking S.66 amendments in the House on "true grandfathering" and
"competitive renewal processes."
The NLC committee also criticized Mayur Royer for violating the NLC policy
development process in negotiating the final terms of the "compromise"
with the National Cable Television Association. The Committee reiterated �`
0
S.66 Fan Out Report
its earlier opposition to S.66.
El
June 20 ,1983
S.66 California Network
If you wish to continue to receive this fan out report, please complete
the attached form and return it to us.
Further Information
Don't hesitate to contact me or Jim Barnes or Mile Stover of our staff
(phone 2i3x866-9771) or Len Simon of the U.S. Conference of Mayors (phone
202x293-7AO) if you have any questions.
PEZ:kp
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S.66 NETWORK FOR LOCAL CABLE AUTHORITY
Please add us to the informal "network” of California cities
working together to protect local cable franchises and our rights
to refranchise.
City
Contact Person
Title
3'' reet ZIP
Telephone
Our Congress Member (s) is
Return to:
Mayor Paul E. Zeltner
City of Lakewood, 5050 Clark Avenue, Lakewood CA 90712
(213) 866-9771
- t e ,� r r a - •x1 xz� �a :
CY � td5 ���`•{� r+."iSf
LI
Federal Cable Television
Legislation and the Cities
Propo�'"�ii Resolution No. 20
Mayor Richard S. Caliguiri
Pittsburgh
Mayor Lewis C. Murphy
Tucson
1) WHEREAS, cable television is an important communications and infor-
mation technology for the nation's cities; and
2) WHEREAS, provision of cable television service has already proven to
be a valuable service to hundreds of communities across the
country, and holds great potential promise to all cities in
the United States; and
3) WHEREAS, the cable television industry is thriving and growing in
the United States, with large return on investment and likeli-
hood of even more considerable profit in the future; and
4) WHEREAS, local governments have had the responsibility for franchis-
ing cable television systems in their cities and for overseeing
the implementation of those franchises once awarded; and
5) WHEREAS, the franchising process has been a model of the free market-
place at work, with enormous competition between cable companies
for the privilege to provide exclusive service within a community;
and
h) WHEREAS, cable television, because it will likely enjoy exclusivity
within a community and will be the only telecommunications
medium with a direct link to the homes of citizens with its
facilities traversing the public's property; and
7) WHEREAS, the presence of a strong local government role in overseeing
of franchise agreements has worked to ensure that contractual
obligations are carried out and the public interest served; and
8) WHEREAS, the best approach to franchising, oversight of the franchise,
and resolution of problems which may occur from time to time in
carrying out franchise elements, has been the direct negotiation
between local governments and cable companies, unfettered by the
presence of third parties; and
9) WHEREAS, local governments, recognizing the need for and success of
direct relationships between cities and cable companies, have
sought to discourage unnecessary involvement in these matters
by the Congress and the Courts; and
10) WHEREAS, cities, working together and with a broad coalition of
concerned interests including representatives of labor, education,
consumers, telecommunications, rural and utility interests, have
helped to defeat in recent years broad attempts to remove local
governments from their central role in the cable television
process; and
34
:i: a''^ -S .i"-` fi .144.{ 'e.'+Atti"x ! �ai`.M1`§•G"Cjl`�'•: _ yR:. x;e?xP `vr i:'fa".r.� , -.... - ,,.. .-
11)
t
WHEREAS, federal cable television legislation is again being con- r
sidered by the Congress, with legislation pending before the
full Senate and Itarings having commenced at the Subcommittee
level in the House of Representatives; and
12)
WHEREAS, there is a possibility that a strong, bi-partisan effort
will be made by the Congress to enact federal cable television
legislation in the coning months; and
13)
WHEREAS, the proposal currently pending before the full Senate is '
an improvement over the versions which preceded it, and
14)
WHEREAS, members of the House and Senate who have worked closely
with the nation's cities in a broad variety of areas, fully
understanding the traditional and appropriate opposition of
local governments to such legislation, will be looking to
the nation's Mayors for leadership and direction in improving
whatever proposals are forthcoming,
15)
NOW, THEREFORE, BE IT RESOLVED that the U.S. Conference of Mayors
reaffirms its view that federal cable television legislation
restricting the traditional responsibilities which have been
exercised by local governments in this area is not appropriate;
and
1£)
BE IT FURTHER RESOLVED that if federal cable television legislation
continues as a possibility, that the U.S. Conference of Mayors
shall work to ensure that, to the extent possible:
• federal cable legislation not limit the option of local
governments to regulate the rates charged by cable
television companies for basic service, should cities
believe it in the public interest;
• federal cable legislation not limit the option of local
governments to define by negotiation with cable television
companies the definition of basic service;
• federal cable legislation provide maximum competition
in the franchise renewal process with no presumption
or expectancy of renewal on the part of the cable
company holding the franchise;
• federal cable legislation "grandfather" all.existing
franchises, and their terms and conditions and.al _
franchise processes in which a Request for.. Proposal
has been issued; and that federal legislation�`not
apply to renegotiated franchise agreements-, signed
within six months of enactment;
• federal cable legislation not provide cable. companies;:,
with the power to abrogate contractual obltgations;'
bared on a unilateral assertion of a significant
change in circumstances;
35
• federal cable legislation not limit the ability of
local governments to mandate public, educational,
governmental, and leased access to cable television;
• federal cable legislation not limit the ability of
local governments to negotiate the purchase price of a
cable system if there is a material breach in the
franchise agreement;
• federal cable legislation not define franchise fees to
include taxes, fees, or other assessments, imposed by
the franchising authority or other governmental
authorities on cable system operators or cable sub-
scribers; and
17) BE IT FURTHER RESOLVED by the U.S. Conference of Mayers that Congress
is urged to closely examine the possibility of federal legis-
lation in the areas of minimum technical standards, minimum
privacy standards, minimum cross ownership provisions, minimum
third party access standards, and minimum standards for inter-
connection; and
18) BE IT FURTHER RESOLVED that in working with Congress in the whole
area of cable television legislation, the U.S. Conference of
Mayors shall be guided by the principle of preserving existing
municipal authority in the cable television field, which has
greoLly benefited the cable television industry, the cities,
and the nation.
36
1-1.1-1-1-11-- _11 ----1._1_z-11 . . _.
CONGRESSIONAL RECORD —SENATE
So the bill (S. 66% as amended, was
passed as folioim
B. N
be V enacted by the Se—tt and Rowe Ql
Arpresrntotfres o1 the Uslited Stater of
Arnernca tr Compress sttMibled, That (a)
this An may be cited as the -Cable Tele-
communications Act of 1963--
(b) The communications Act of 1931 Is
amended by Inserting i ue Kety after
title V the following new utle:
TITLE VI -CABLE
TFImMUMUN1CATIONS AST
-ri"iteas
..fret. 601. The Co►►greas hereby finds
that-
4 1) cable systems are engaged to inter-
state commerce through the arigtnation,
trancr...scnon eL tribuu,)n. and dissemina-
tion of broadband telerommunlat)oM serv-
Sees:
-42) the provision of brondbttad telocotn-
rr.unications is of concern to governmental
elititics
-(3) a uniform national policy for broad-
band telecommunications can auve to eliml-
niar and prevent confllcting and Counter-
productive regulatloos in order to allows un-
hampered growth and developrment of cable
oA a competitive medium which will be re-
sponsi a to and serve the needs and inter-
ests of the public:
"(4) competition is a more efficient regula.
V.. . ;4:emment of the provision of di-
verse telecoamnunic"ns services and as
competition continues to develop. the dere(-
of tei.cotarnun::ations services
should occur. and
-45) rveognidng the long standing tradi-
tion of the Congress of promoting universal
telephone service at reasonable rates, and
recognizing the rapid technological changes
of the types and delivery of services offered
by the teleeammunicatitru Industry. It Is In
the public Interest to ensure that an provid-
ers of telecommunication services ahs" In
the obligation of providing nnh'eru) am -See.
"ruaroom
fiat. 662. The purposes of this title are
to -
"t l ► establish a national policy concerning
broadband telecommunications and to en-
courage a competitive environment for the
growth and development of broadband tele-
communications.
"(2) establish guidelines for the exercise
Of Federal. Stateand local regulatory au-
thority:
-(3) allow cable systems to be responsive
to the needs and Interests of the public on
an equal basis without a compeUtive disad-
vantage with other providers of telecommu-
Alostons services: and
'14) elkninate government seg )WOn in
order to prevent the imposition of an unnec-
essary eoon omit burden on able systems in
theft provision of service to the public.
"'mssnrrmows
"Bac. 603. for purposes of this title, the
terrn-
" t 1) 'basic sesvlee' means the lowest cost
der, other than a tier offered at a discount-
ed fee, of service which is available to sub-
scribers for a fee and which Includes the
provision of retraru mission of local brood -
mist signals, public- educational. and govern-
mental programing and any other pr'ogr'am-
ing service as offered by a cable operator as
part of the tier, and specified in the fran-
chise agretaient as part of basic service.
which is 6istributed by coaxial able or any
other closed transmission medium:
"(2) 'basic te)eptwne service' means two.
way vote. Cede communications that is
held out to the public and that would be
subject to regulation by the Commission or
any State if offered by a oommon carrier
subject. In whole or in part, to title II of this
Art;
"(3) 'broadband telecommunications*
means any receipt or transmission of elec-
tromagnetic signals, Including basic service.
able service. and telecomrnunics.0oru serv-
Ice. over coaxal cable or any other closed
transmission medium:
"({) 'broadcasting' means Wecormmunica-
tions by radio intended to be moelved by the
public, directly or by the intermediary of
relay stations:
'(S) 'cable clurtnel' or 'channel' mew
that portion of the electroauazutic frequen-
cy spectrum used In a cable system for the
Propagation of an slectrvenAcnetie signal.
*16 1 'cable operator' or 'able system oper-
ator' means any person or persoru, or an
agent or employee thereof. that provides
basic serine, able servke, or Wecommuril-
ations service over a able syateM or that
directly or indirectly owns a significant In -
West in any able system or that otherwise
controls or Is responsible for, through any
arrangement. the management and oper-
ation of much a able systems:
'•(?) 'cable service' means the provision by
a channel programer of one-way programing
on a per channel, per program, or other
basis which is distributed by ooajcW able or
any other closed transmission sediusn, but
such term shall not Include basic service:
"(6) 'cable subscriber' desats any person
who receives or transmits electromagnetic
signals distributed over a cable system
*19) 'Cable system' means a facility or com-
binatlan of facilities under the ownership or
control of any person or persona, which can -
&W of a primary control center used to re-
ceive and retransaslt or to origirnte broad -
hand telecci mmunJcsnom service over one
or more coaxial cables., or other closed
transmission media. from the primary con -
troll center to a point of reception at the
premises of a cable subscriber. r. but such
term does not include: (A) a facility at coon
binatlon of facilities that serves only to re-
transmit the television signals d tekvislon
broadcast statlorm (B) a lacibty orcornbfns-
tien of facilities that caves tally atrx- '- ---
in one or more anultiple unit dweltings
under common ownership, control, or man-
agement; or (C) a common carrier subject to
the provisions of title 11 of this Art when-
ever such carrier transmits broadband tele-
conimunicatioru services other than bask
servioe or able service:
(10) 'channel programer' or 'programer'
means any person having an agreeatent to
Provide basic service or cable service to a
able system operator, or any person who
S8325
leases, rents, or U otherwise authorized to
ase the facilities of a cable system for the
provision of basic service or cable service.
and such term shall Include a cable system
operator to the extent that such operator.
or person or persons under common owner-
ship or control with such operator. is en-
gaged in the provision of such service:
"(11) 'closed trate nisslon medium' or
'closed transmission media' means awdia
having the capacity to transmit 40octromas-
netic signals over a common transmission
path such as coaxial able, optical fiber.
wire, waveculde, or ott •r such &Wnal wn-
ductor or device:
-02) 'franchise' means a permit, Men".
ordinance, resolution, riSht-of-w•ay con-
tract. certificate, agreement. or similar Au-
thorization issued by a franchising authori-
ty which authorizes the provtxion of basic
service, able serviv. or telecorr►snunia(ions
service by a cable operator:
"(13) 'tranchising authority' means any
State, political subdivision, or agency there-
of. or any other governrnenW entity em-
powered to grant a franchise:
•114) 'grade B contour' means the field
strength of a television broadcast station
computed in accordance with regulations
promu--.„ated by the Commission:
"(IS)'informal ion' anew knowledge or In-
telligencr represented by any form of writ-
ing, signs. signals, pictures, mounds. or other
a mbols.
"(14) 'taw' Includes any rt-sulation rule.
order, standard, policy, requirerneent, proce-
dure, or restricuon;
'071 'person' means an individual. part-
nership• association, joint stoct company.
trust. eorporatica or any soverrunental au-
thority:
"(ig► tdecammuaications' moons the
transmission of Information by dectromse-
netic means, with or without benefit of any
dosed transmission medium, including all
instrumentalities, facilities, apparatus, and
services (including the collection. storage.
forwarding. switching, and delivery of such
information) essential to such transmission:
'(19) 'telecommunications service' means
the offering of telecommunications faclll-
Ues, or of teleeommunicatloru but such
terms shall not include bask service or cable
servkt: and
"120) 'United States' mears the several
States and territories, the District of Colum-
hisa, and the paamajons of the United
Sutra
-mTATLarl1R OF Atr71M... T
`Sac. 3W.'Tbe provisions of this title shall
appiy as follows:
"(1) The Commission shall have jurindic.
tion and exercise authority with respa.t to
broadband telecommunications in accord-
ance with the provisions of this title and
other applicable provisions of law.
•12) Nothing in this UUe -hall be con.
strued as prohibiting any State or political
subdivisloo or agency thereof. or frarnchia-
Ing authority. from awarding. In accordance
with the provisions of this We, one or more
able franchises within its Jurisdiction.
-(3uA) Except to the extent provided In
paragraph (B), no able system shall pro-
vide bask service or able service without a
cable franchise In compliance with this title.
'(B) The provision of paragraph (A) shall
not be applicable in the care of any cable
system In operation on April 21, 1993.
"Owxt:aaHra Oa co19TROL Oi ours a7 -TCM -
"Sac. 605. (a) No State or politleal subdtv►-
Won or agency thereof. or franchiring au-
tbority, ahall have the authority to prohib-
it. directly or Indirectly. the ownen%hip of
cable systems by any penin by rea.non of
that person's ownership of any other media
S8326 CONGRESSIONAL RECORD —SENATE
or other Interests, including broadcast,
cable, newspaper, programing service, or
other printed or electronic information serv-
let-.
" e bx U Notwithstanding the provisions of
suhme tlon (a) of this section, for the pur'
Dose of ensuring fair and equitable treat.
ment of United States cable enterprises
seeking access to markets in a foreign coun.
try, the Commission shall have authority to
conduct lnquarles applicable to foreign per-
sons from that country seeking access to do-
mestic markets in the United States in con-
nection with the constn:etioru, ownership
and operation of ..pie enterprises as to
whether such United Sates catle enter-
prises are permitted fair and equitable
access to such foreign markets.
"t 2) The Commission shall submlt any in-
formAtwti ohained through such Inquiries
to the United States Trade Representative
to assist the Trade Representative In his
identification and analysis of acts, policies
or practices which constitute significant
barriers to, or distortions of. United Sates
exports of sen-t(ea
'13) For purposes of this subsection, the
term 'foreign person Includes any Individu-
aI who h not a cittwn of the United Sates,
any subsidiary (although established under
the laws of the United Sates or any Sate
thereo!) of a corporation or other business
entity which was established under the laws
of a foreign country. any corporation or
other business entity established under the
I&%-% of a foreign country. or any corpora.
tion or other business entity established
under the laws of the United States or any
State thereof. tf 25 percent or more of the
capita: stock or equivalent ownership Is
owned or controlled by an Individual who In
abut a eaauen of the United States or by a
corporation or other business entity estab-
lished under the laws of a foreign country.
or any sutxidlary of a corporation or other
bucineas entity established under the laws
of a foreign country.
'(c)(1) Notwithstanding the provisions of
Kubtection (a) of this section. a State or po.
litics., s thditi axion or agency thereof. or fran-
ch,sina authority, may not acquire an own-
ership interest in arty cable system pursuant
to a buy -baht provisions of a franchise or re-
quire a We of a cable system to any other
Person pursutanl to a franchise. upon the ex-
vira:wti of the franchise. unless such State.
!t:ibd!vislon. agency. authority. or person ac-
quires such ownership or interest at not Was
than fair market value teased upon the on -
of the system. In the
event that the cable operator and a State or
political su"v sion or agency thereof. or
•i^ •h• `:I. arc urisb:c to agree
upon any such fair market value. then the
matter of determining fair market value
shall be submitted to binding arbitration.
For purposes of arbitration. each of the af-
fected psrrles shall select one arbitrator and
the two arbitrators so seleCcd shall choose
a third arbitrator.
-,(2) Notwithstanding the provisions of
paragraph (1) of this subsection. In the
event of termination for cause of a fran-
chise due to a material breach, a State or
pollticiLl subdivision or agency thereof, or
franchising authority. may acquire an own-
ership Interest in such cable system but
only upon written notice of the breach, rea-
sonable opportunity to remedy the breach,
and other due process- Any such termtna-
tion shall be subject to de novo review by a
court of competent jurtdktlon.
"(d) In any case In which any such State.
subdivisboo, agency, or authorit, has or ac-
quires any such ownership or Interest. such
State, subdivision. Agency. or authority
shad. in no case. own or qDntrol. directly or
Indirectly. the content of any o1 the pro
gramins on such cable system, except for
programing on government access channels,
unless such State or political subdivision or
agency thereof, or franchising authority. es-
tablishes an Independent bused or a septa -
rate management company. Such board or
company shall not include any State or local
office holder.
'-Accts cxAxrsgu
"Sae. 606. (a) A cable system operator may
be required, as part of the franchise request
for proposals, to deck ate or set aside chan-
nels for public, educational or governmental
users, and the cable system operator may
offer In a franchise to dedicate or set aside
channels for other channel users.
-(b) The franchising authonty and the
able operator may establish rules and pro-
cedures for the use of the channels act aside
or dedicated pursuant to this section.
"(c) Until such time as there is demand
for each channel frill time for its designated
use. public. educational. governmental, or
other channel programing may be combined
by the able system operator on one or more
channels, and to the extent time is available
on such channel& they may be used by the
able system operator for the provision of
other services.
RACULATtora or averts Axa snuvtcts
"Sar. 607. (a) Nothing in this title shall be
construed as prhibitfng any State or politi-
cal subdh Won or agency thereof, or fran-
chising authority, from establishing, fixing.
or otherwise restricting the rates charged
by able operators—
"(1) to subscribers for the receipt of basic
service.
*12) to subscribers for equipment neves
tart' for the receipt of basic service, and
'13) to subscribers for equipment which
facilitates the reception of basic service by
hearing Impaired Individuals.
"(bx1) Any rate regulated pursuant to
this section may be Increased wumally at
the discretion of the cable operator by an
amount not to exceed the regional consum-
er price index for the preceeding 12 months.
upon 30 days prior notice. The ability to
affect such Increases shall be cumulative for
not more than 3 successive years.
"(2) Nothwithstanding the provisions of
paragraph (1) of this subsection, nothing in
this title shall be construed as prohibiting
any State or politlral subdivision or agency
thereof, or franchising authority, from pro-
vfdtrig that such autonastle Increases shall
not apply to a franchise which is In exist
ence on the date of the enactment of the
Cable Telecommunications Act of 1933 and
which provides for a fixed rate for basic
service over a specified period.
"(c) Notwtthxtanding the provisions of
subsections (a) and (b) of this section, a
able system operator may automatically in-
crease bask service rates which exceed the
basic rates allowed pursuant to subsection
fr.) or (b) of Tile section if—
' -(1) such operator has requested the In-
crea-v in rattK and
**42) the roque m Is not acted on within 90
oat's following the date of Its receipt.
^(d a l) Notwithstanding the provisions of
subsection (a) of this settlors, the authority
to establish. th. or otherwise restrict the
rates charged to) subscribers for the provi-
sion of bask services set forth in subsection
(a) of this section, except to the extent oth.
erwise provided b,% paragraph (2) of this sub-
section, shall not be applicable in any ase
where the cable system is located within the
grade B contour )f not less than four televi-
sion signals of w:aich there shall be one af-
f Bate of each of the three maior television
networks.
'-(2) The provisions of paragraph (1) of
this subsection shall not be applicable in the
June 14, 198.1
case of any franchise In existence- prior to
the date of the enactment of the Cable
Telecommunications Act of 1983. If the
rates charged to subscribers for the provi-
sion of basic services are subject to regula-
tion or are restricted by any State or politi-
cal subdivision or agency thereof. or any
franchising authority. The provisions of
this paragraph reiating to existing rate reg-
ulation of basic service shall be applicabie
for a period of 5 years following the date of
the enactment of such Act. or for a period
equal to one-half of the period of the re-
maining tt-rm of such franchise, as of the
date of the enactment of such Act. which-
ever Is greater. The provisions of paragraph
(1) shall be applicable to any renewal or
other extension of any such french ise
-'(3) The provisions of paragraph (1) of
this subsection shall not be applicable
where the cable system is subscribed to by
at least 60 percent of the residences to
which able service is available, unless the
cable operator demonstrate& that 90 percent
of the time, adequate on-site reception of
the four television signals is available to
more than b0 percent of the households to
which cable service is &%-&liable. Such a de-
termination shall be made by the Commis-
sion. Failure by the Commission to make a
determination within 180 days atter the
filing of an application by the cable opera-
tor shall be deemed to be a determination
that such satisfactory reception is avallable.
'-(e) No'executive agency of the United
Sate& including the Commission, and no
State or political subdivision or- agency
thereof, or franchising authority, shall have
authority to regulate or restrict the rates
for reconnection additional sea to the same
subscriber, or sales of equipment.
-(I) No executive agency of the United
Sates, Including the Commission, and no
State or political subdivision or agency
thereof, or fraaichistng authority. shall have
authority to regulate or restrict the provi-
sion of or nature of able servlzes offered
over a cable system except as provided in
section 613 of this Act.
••(g if 1) No executive agency of the United
States, Including the Commission. and no
State or political subdivision or agency
thereof. or franchising authority, shall have
authority to regulate or restrict the provi-
sion of or nature of wlecommunlcations
services offered over it (able ay -stern, except
with respect to the provision of basic tele-
phone service, intrastate telecommunica-
tions servic", and except as provided in sec-
tion 613 of this Act.
"(2XA) Bub" to the provisions of sub-
paragraph (B), a State may require only the
filing of informational tariffs for Intrastate
telecommunications services that would be
subject to regulation by the Commission or
any State It offered by a common carrier
subject, in whole or In part, to title I1 of this
Act, which are offered over a cable system.
Such Informational tariffs shall specify only
the rates. terms, and conditions for the pro-
vision of service and shall take effect on the
date specified therein.
"(B) Subparagraph (A) shall not apply to
any private teleoommunicationa service
which Is a discrete service dedicated to a
single customer and operated by such cus-
tomer.
"(3) A State shall deregulate the provision
of intrastate telecommunications services If
It finds that such services are subject to ef-
fecUve competition.
"(is) For purposes of this subsection, an in-
trastate telecommunications service shall be
considered to be subject to effective compe-
tition In a particular geographic area or
market if there are reasonably available a)-
ternatives. In determining whether there
0 0
June 14, 198.1 CONGRESSIONAL RECORD —SENATE
are reasonably available alternatives, the
State shall consider—
(A) the number and size of providen of
sect ices;
-(B) the extent to which services are
avaliable from providers in the relevant geo-
graphic area or -muket;
' (C) the tab!lity of such providers to make
services readily available at comparable
Wes. terms. and conditions; and
'-tm other indicators of the extent of
competition. including affiliation of provid-
ers of services.
"(5) Nothing in paragraphs (2). (3 ). and
(!t) of this subsection shall be construed as
being applicable to basic telephone service.
"(h) Nothing in this Act shall be con-
strued as prohibiting a franchising authori-
t Y and a cable operstor from specifying, in a
franchise agmment or renewal thereof.
that certain able services shall not be pro-
v3ded or ahall be provided suhJect to condi-
ttons, if such able semices are obscene or
are otherwise unprotected by the United
States Constitution.
•'(a) The provisions of subsections (b). (c).
and (d) shin) not apply to a franchise agree-
ment in existence on the date of enactment
of tnu Act far a period of 5 years following
the dat- of enactment of this Act, or for the
remaining term of such franchise as-ree.-
ment, whichever is greater. In any State
wl.ich has in effect, an4 has had to effect
since January 1. 1983, a statutory scheme
deregulating rates which contains a require-
ment regarding minimal channel capacity.
FRANCHISE rtes
'"Sac. 608 (a) Cable operators may be re-
uuirM to a francl(ue to pay to A State or po-
litical suttd,vtsion or agency thereof. or frs.n-
ct:.:..r.� cu:ho::t). a :rar._hlac fcc.
`(bN 1) No franchise' fee paid by a able
system operator for the privilege of holding
a franchLt^. •hall xc-rd an anmral stsre-
catr of 5 perces* of such able operator's
gross revenues der:vtd from the operation
of the rabic aystem which is the subject of
the franchise,.
12! Nothing in this section shall be con.
strued &.6 limiting fees required by a fran-
chise in effect on the date of enactment of
the Cable Telecommunications Act of 1983
to be pard directly or indirectly to entities
rstabll.hed for the puma' of facilitating
the use of channels set aside for public. edu-
cational. or government&] use.
tc) Any able system operator may pass
t.'re cost of any Increase in a franchise fee
thrnurh to s:rbsr- t ors. and may dea►irriate
i:.r total ,r.:.crliXe fee Y A seNarate item Or)
the subscribers' bills.
"(d) For the purpose of this section—
.i) u.w,rt,iee iet shall atelidt any tax.
fee or assessment of any kind Imposed by a
franchWng authority or governmental au-
thority on a able system operator or cable
subscriber bemuse of their status as such;
and
"121 'assessment' shall not include bonds.
security funds. letters of credit. }MUMIce,
indemnification. penalties, liquidated dam.
ag-s or st nllar requirements which are inci.
dental to the enforcement of the franchis-
mg agreement.
"tea Notting In this section shall be
deemed to require a cable operator to re-
negotiate the provislons of an existing fran-
chise.
..mmv KAIs AND t:Ttrialoly
"Sac. 809. (a) In any ate in which a cable
system operator submits an application to
the franchising authority for the renewal or
other extension of such operator's franchise
authorl=tlon. the franchising authority
shall grant such ren .—.&l or other extension
urilms it finds that-
(I) the cable system operator has not
substantially compiled with the material
terms of such franchise and with applicable
iaw, or has been convicted of a felony;
"(2) there has been a material change In
t1he legal. technical. or financial quallfica-
tions of the cable system operator that
would substantially impair the continued
provision of service by such operator.
"(3) the facilities to be provided by such
operator, including facilities for governmen-
tal arcm. are unreasonable In tight of the
community need for and cost of such facill-
ties;
•14) the signal delivered by the cable
system within the control of the cable
system operator, has not generally met
technical standards as established by the
Commission; or
•(5) the proposals contained In the renew-
al application are otherwise unreasonable.
'•(b) A cable system operator must file for
renewal at least 24 months, but not more
than 3ti months, before expiration of the
franchise. The franchixins authority nust
consider the renewal within 120 days of sub-
mission of the application and conduct any
proceedings necessary to adequately consid-
er the application.
(c) A able system operator with a fran-
chise which aha,: expire within 24 months
after the date of enactment of the Cable
Telecommunications Act of 1983, shall be In
compliance with subsection (b) if he files an
appl!cation for renewal within 60 days after
such date of enactment.
-(d) The franchising authority shall—
"(1) negotiate in good faith with any able
system operator regarding franchise renew -
a] within 30 days after flu completion of
proceedings pursuant to subsection (b); and
•12) make a final decision on granting or
denying renewal within 12 months after re-
ceipt of an application;
•'(31 In the ease of denial of an applia-
tion—
' (A) not make the final decision for at
least 7 months from the date of receipt of
the application: and
•'(B) notify the applicant by written state-
ment, within 7 days after the final decision,
of the reasons for the denial.
•'(e) Any renewal applicant adversely af-
fected or aggrieved by a final decision of a
franchising authority made pursuant to sub-
section (d), or by a failure of the franchising
authority to set In acrorJAnce with subsec-
tion (d). may obtain jue..Jclal re%;tw of such
final decision In any court of competent ju-
rtsdiction. The existing frutchise shall
remain arra effect pending the completion of
such Judicial review. Such Judicial review
shall be de novo. unless the renewal appli-
cant has been afft•r'ded a hearing on ret-ord
before an Independent hearing examiner or
administrative law Judge consistent with
State law that requires --
-Q) adequate notice;
"(2) faLr opporurtlty for participation by
tt-e renewal applicant. which Includes—
^(A) discovery;
^(B) the filing of pleadinm, motions, or
objections;
-(C) the Introduction of written or oral
testimony: and
"(D) cross-examination of opposing par-
ties; and
-(3) a written decision by the examiner or
judge based exclusively on the full record of
the hearings and stating the spec1ic find-
ints of fact and conclusions of law on whlrh
the decision is based.
•'UNAUTHORMID rlri 1RCOTION OR RDCEPr:ON
"Sax. 610. (a) No person or government
authortty :shall Intercept or receive broad.
band telecommuniations unless specifically
authorized to do so by a able system opera-
for. channel programer. or originator of
broadband telecommunications or As may
S8327
otherwise be specifically authorized by Fed -
oral law.
••(b) In order to safeguard the right to pri-
vacy and security of broadband telecommu-
WeLtions, such broadband telecommunics-
tions shall be deemed to be a 'wire commu-
nication' w°Ithin the meaning of section
2510(1) of title 18 of the United States Code.
•'(c) In the event that there may be any
diff:rence between the provialons of this
section and chapter 119 of title 18 of the
United States Code, or any regulations pro-
mulated thereunder. It is the intent of the
Congress that such chapter 219 shall be
controlling.
rROTSCTION Or aUaSCRIatR TRIVACT
"Sv . 611. (axl) Except as provided in
paragraph (2) of this subsection. no cahle
operator channel programer, or originator
of broadband telecommunications may use
the cable system to collect personally Identl-
fiable inform%tion with respect to a cable
subscriber, except upon the prior written or
electronic consent of that subscriber.
.(2) The provisions of paragraph (1) of
this subsection shall not apply to the COM""
tion of tnforntatton solely for billing Pur•
poses or to monitor whether there Is unau-
thortzed reception of able telecommunia•
tions.
'•(3) A able operator, channel programer.
or originator of broadband telecommunla-
tions shall ensure that any such informs•
tion is destroyed when the information Is no
longer used or to be used for'the purposes
for which It eras collected.
"(b) No cable operator. channel pro
gramer. Or originator of broadbetnd telecom-
inuntcatlons shall disclose personally identt-
flable Information obtained pursuant to
subsection (a) of this section with respect to
a cable subscriber. or personally 'Identifiable
Information with respect to the services pro-
vided to or received by a particular WAW
subscriber by way of a cable system. excep•
upon. the prior written or electronic consent
of the subscriber. or pursuant to a lawful
court order authorizing such disclosure.
"(c) If a court shall authorize or order dig
closure, the able subscriber shall be notl-
fled of such order by the person to whom
such order may be directed. within a rcaxor-
able period of time before the disclosure is
made, but In no event less than Is calendar
days.
•'(d) Each cable ope-ator
of entering unto an agreement to pro% We
cable telecommunication, and regularly
thereafter. inform every svbsrr(I»- n' 'h^
rights of the subscriber under thiv section
Such blformation shall include a description
of the nature of the infon-nation to be main-
tained by the cable operator. channel pro-
gramer. or originator of broadband telecom•
munlcatlom. and the location and avallabil-
Ity of such information.
•'(e) A cable subscriber shall have access to
all personally Identifiable information re•
wdfnr that subscriber which is collected
and maintained by a arable operator, channel
programer. or originator of broadband tele-
communications. Such information shall bp
available to the subscriber at reasonablr
titnex and at a place designates by the cabie
operator. channel programer, or originator
of broadband telecommunications.
"(f) Any able subscriber whose privat•y is
violated in contravention of this section.
xhall be entitled to recover cf-01 damages as
authorized and in the manner art fortiN in
K -%•',)n 2520 of title 18 of the Unittd F'ar.r
Codd. This remedy shall be In adc•'r:,r 'n
any other remedy available to such sub
scriber.
. >'.1MRITA-N�'�✓"'i �'.. �!?r...�rrt.:�.ev....-rr-.or.......::.....,...., �.,.,..�....i.t�-.'r.>'rr4:. :r... r..� v.....1'1n'i"�a...r,�'rMY ,: l�-WMAFY"'cv'/'n'uTMiwv!
S9328
"CRtY1NAL AMC) CIVIL UA81LITY
0
CONGRESSIONAL RECORD —SENATE
"Sac. 612. Nothing in this title shall be
deemed to affect the criminal or civil Itabili-
ty of rhsnnrl programers or cable operators
Pursuant to the lav of libel. slander. obscen-
ity, incitement, invasions of privacy. falx or
misleading advertising or other aimllar
laws, except that cable operators ah&U not
incur such liability for any program carried
on any public. educational. governmental. or
other cl-a",ei referred to In subsection (a)
of section 6u6. or for any program required
by las to be carried on any other channel.
"MOGRAY119G. aaRVICEL AND ►AOUTtas
-Svc. 61& (a) No State or political subdivi-
sion or agency thereof, or franchtdng au-
thority. may require the provision of partic-
ular programing or other broadband serv-
ic,". or forillties. egu:prnent. services, or
other •t(ma of value which are not related
to the provision of broadband telecommuni-
cations service.
"(b) A franchising autbority tiny require.
as part of the franchibe request for propos-
&Is—
" t 1) channel capacity for public, educa-
tional or governmental access purposes: and
`i Y) the corstructlon of cable system faeil-
)"cn or provision of ether ahle-related
cqulpment.
`(c) A cable operator may offer. but may
not be required to provide. On pari of basic
sen kY or guy other tier of service --
`(1) channel capacity fo: other secesR
uses: and
-(2) particular service+
'(d) The cable operator MAY replace or
rtmovc a particular service specified in the
cable franchise as part of the basic service
or any other tier of cable service or telecoa)-
m1mw*tlrr-w aeTr" In (tat!' rise In which
there has been a significant change In cir-
cuwtances since the cable operator's offer
to prov14ie such service. The able operator
may not be required to retain a specified
service in my particular category of service
of her than baste service.
- (2) to any (ase in which a cable operator
.ubmitik a showing that, as a result of a sig-
ntficant change in circumstances; 1)articular
far-Likits and equipment required by the.
franchise are economically. technkally. or
othrra," impracticable. the frao.:hising Au-
thority shall enter Into negotiations with
the cable operator for the to urination.
modificatiou. or deferral of such require.
ment. If such terms and conditions cannot
be agreed upon within 43 days. the matter
sh-01 �- wuhmItted to binding arbitration.
for I,, -poses of arbitration. each of the Af-
fected partici shall select I arbitrator and
the 2 arbitrators so selected shall choose a
tntrd arbitrator. The existing franchise pro-
vWons. except for thaw which are the sub-
ject of art-Atmtior. shall not be affected by
the arbitrators' final decision.
"(e) Except as provided in subsection ic)
of this section, a lranehislng authority may.
in accordance with the provisions of this
section. enforce any offer to provide Partle-
ular basic servf4u set forth in subsection (c)
or particular table services of telecommuni-
cations services or able system facilities or
cable -related Maipment offered by a cable
operator provided that the provision of such
senicea faclUtlea or equipment Is specifl-
cxlly ree;tthed by the franchise agreeme-t.
tf) Notwithstanding the pr ending provi-
sit.nu of this section. In any ase to which a
franchise agreement In Meet on the date of
I he enactment of the Cable Telecommunia-
tions Act of IM requfne the cable operator
to provide t^articular progruable. servicw
facWtiea cable relaW !gutpmMIL. or chan-
nel capa`t•"ty for access uses. such requlre-
mmits. subject to r.)beections (d) and (e).
&hail remain to effect for the terra ed the
franchise and in accordance with the provi-
sions thereof. Fbr purposes of this subsec-
Uort, a franerdw agreement containing such
requirements sha.1be considered to have
been In effect on such date of enactment U
such agreement sues the result of a Irwn-
chise proceeding for which a request for
Proposals was originally issued. however
subsequently modified or replaced. on or
prior to September J0. 11181.
`NO RRCDIATTON AS COfOtP3i CARRIER
"Sac. 614. No executive agency of the
United States, including the Commission.
and no State or political subdivision or
agency thereof. or franchising authority.
shall have authority to impose on a cable
system regulation as a common carrier or a
utility to the extent that such cable system
provides broadband telecommunications
service other th,,n basic telephone service...
QCL'DSIYs JURISDI TION
Bev. t (a) Except to the (xtent otherwise
specifically provided in title VI of the Com-
munications Act of 1934. as added by the
first section of this Act and as provided in
section 607 of such Utle. the Federal Gov-
ornmetri shall have exclusive Jurisdiction
over broadband telecommunleationa regard -
Ing matters covered by such Utte.
(b) Any las of any State or politica] subdi.
vision or agency thereof. or franchising au.
thortty. In effect on the effective date of
Me VI of the Communicetiots Act of 1934.
as added by the first section of this Act.
which Is in conflict with the provision of
subsection (a) of this section relaUng to the
exclusive jurladiction elf the Federal Gov-
ernment, shall be deemed superseded. as of
the expImUon of the 6 -month period follow-
ing the date of the enactment of this Act.
and AMU thereafter be null and void ):ad of
no effect.
(c) Except to the extent otherwise pro-
vfded by this Act and the amendments Invade
thereby. any State or politkal subdivision or
agency thereof. or fromehiaing authority.
may exercise Jurisdktlon over asatten
which are of strictly local eoncern and
which are necessary for revaons of public
health. safety, and weUam hlduding the
terms and conditions for the granting of a
franchise. the eonstructlon and opersUou of
a cable systetn..nd she enforcement and ad-
ruinistrstlon of a franchise.
WM Acis ADOrrtONAL ssavrtss
Bac. & Title I of the CommunksUots Act
of 1034 Is amended b7 !rLseltinj after rection
6 the foikawtng new sectloas:
NNW AND AMMOMAL S3 TUM
`Bac. 7. (a) Consistent with round spee-
ttum management, the Commission .hall, to
the maximum feasible extent, encourage
the Introduction of nev and additional am -
tots by new applicants. existing Ik*nseeak or
other persufls. In azy proceeding In which
new or additlonal services are proposed.
such me. v¢hall be presumed to be In the
public Interest whenever the Constrdadon
finds that such services are techlcany Masi-
bie without causing slarMicant technical
degradation to or Interference with radio
tranaminlons by other Uoer»eea
"(b) .lay person may file with the Cow -
mission it petition to establish or an appUga-
tion to offer a new or additional service&
"(c) The Commiaslon must dettrlltine
whether the new or additional service pro -
Posed in a peUUon or application Is in the
public interest within 1 year after such peti-
tio.I or application IN riled. U tM CUNamis-
sion initiates Its own proceeding for a new
or additionlal servlca. such proceeding must
be completed within 12 months after It is
Initiated
June 14. 198.3
"DECLARATION
"SEs. 8. The Congress declares that com-
petition Is a more efficient regulator than
government of the provision of diverse com-
munications services and as competition
continues to develop, the deregulation of
communications services should occur.".
grrttTIVt VATIC
Sia:. 4. The prorisions of this Act and the
amendments made thereby shall take effect
upon the date of enactment of this Act.
REDEatcNATION
Sac S. The existing title VI of the Com-
munications Act of 1934 is redrstemsted a
title VII, and sections 601 through 809 are
redesignated as sections 701 through 709.
respectively.
N
UNITED STATES CONFERENCE OF MAYORS
I&W) EYE NURUT. %OnM%Tb-r
WASHINGTON. D.C. 20006
TELEPHONE: 1,202) 293--,330
w.�
0
Mr. Chairman and members of the Subcommittee, I am Bob Bolen, Mayor
of the City of Fort Worth, Texas. I am here this morning on behalf of
my city and the U.S. Conference of Mayors, which represents the Mayors
of the nation's principal cities.
The Conference appreciates the opportunity to present our views to
the Subcommittee this morning. Our policy on cable television is at-
tached to the back of this statement, and underscores the very strong
belief of most Mayors that an overriding need for such legislation has
yet to be demonstrated. Without federal legislation, municipal corpor-
ations and private firms have negotiated freely in an open market for
the delivery of cable televis.on services. The cable television fran-
chise is an example of a system working well. Where bid requirements
are excessive, or deemed too costly, cable television companies are
free to decline participation, thereby informing the city that they do
not view the city's cable market as profitable under the city's condi
r
tions. Nor are cable operators forced to sign a contract that is una c
ceptable to them. The terms of a cable franchise agreement can be nego-.
`
tiated openly, and if provisions are proposed that are unacceptable to
either party, no contract is signed, both parties must accept the tori
tractual document when it is signed by the respective sides. Signing the
- agreement implies acceptance of its provisions.
.
All institutional arrangements can stand improvement. But by„and
i
large, we believe that the cable company/local government relationship
has worked well -- the rapid wiring of urban America is good evidence
of this fact. And, where problems do from time to time emerge, 'we
2
believe that the tool of negotiation has, can, and will be used to solve
those problems.
Mr. Chairman, if it is nevertheless the intention of this Subcom-
mittee to achieve federal legislation in this area, we strongly hope that
the Subcommittee will commit to the nation's Mayors now that it will be-
gin the process with an open mind and a clean slate. We, in turn, will
pledge to work earnestly with the Subcommittee and its staff to achieve
a legislative product that is consistent with the public interest. And,
Mr. Chairman, I want it to be stated very clearly and for the record,
that the federal government does not have a monopoly on concern for the
public interest in cable television. In the franchising process. and
in the oversight of the implementation of franchises, city governments
search and work for. not the narrow concerns of what might be best for
city governments, but for the best public interest. The public interest.'
has been our goal and always will be.
I
Mr. Chairman. it is well known that S.66, "The Cable Telecommunica-
tions Act of 1983." as recently reported by the Senate Committee on
commerce Science and Transportation, although an attempt to achieve
.. . Po . 9 p e
agreement where conflict has existed, causes reblems for.man cities -
9 P Y
those with franchises existing, and those which hope to have franchises
soon.
While efforts to achieve a compromise are to be commended, it must
he understood that the negotiations which brought about S.66 were can
menced by the Senate's clear threat of "a worse bill." It is our hope 1:
that the Nouse, if it should decide to go forward, would concentrate. on
Ll
3
good legislation which makes sense to cities, is fair to cable, and
will dispense with threats and coercion.
Mr. Chairman, our key concerns with S.66 could be detailed in the
following manner.
Definition of Basic Service and Rate Regulation
S.66 defines basic service as the lowest -cost tier (non -discounted)
of service which includes the must -carries and the access channels. It
is only this portion of basic cable service to which any local rate
regulation can be applied. In this definition of basic service, "com-
petitive" market is declared. and the cable rate structure is deregulated
completely. Then, what little rate regulation remains (after applying
the "four over -the -air channel criterion") is to be erased after several
years. In addition, operators are permitted automatic CPI -based rate
increases each year, making cable the only locally franchised consumer
service that is guaranteed rate increase every year. This definition of
basic service is deficient on a number of grounds. First, basic service
must be defined, at an absolute minimum, as all non -premium (i.e., non.
pay) channels available to the consumer. A further valuable step would
entail an explicit definition of basic service in a manner that specifies
the channel/service components of "basic service." In this mode, basic
service would be defined as: 1) must -carry over -the -air stations; 2)
any low-power TV stations licensed in the area, 3) all access channels
4) any local origination channels (i.e., operator -programmed channels);
and 5) all other non -premium cable channels.
The Federal Communications Commission's pre-emption of local auth-
ority to regulate pay -service rates makes it imperative that local
W
4
governments retain th.. ;lity to regulate non -pay service rates. As
it now stands, cable operators are free to escalate pay -service prices
without limit (notwithstanding the "market"), to the point that in many
cable systems, CATV operators receive from subscribers double and triple
the price the operator pays to the pay -service providers. In this free
"market," the subscriber doesn't really have the choice of movie or
arts or sports channels -- instead, the choice is to subscribe or not
subscribe to the only such services available. Conversely, basic (non -
pay) services are received by a cable operator free of charge, or for a
few pennies per subscriber; in the vast majority of instances,. the basic
cable rate clearly covers the operator's costs of payment to.the basic
service supplier. Eliminating local government's authority to regulate
these basic rates only increases the cable operator's ability to extract
monopoly profits and surplus revenue from cable subscribers.
Mr. Chairman, rate regulation is important to be retained from our
perspective, as a basic tool to protect the public interest by insuring
that the terms of the franchise agreement are being properly implemented
by the cable company. Most rate increases are fairly routinely approved
-- following assessment by the city that all else is well -- a practice
followed with respect to virtually every other franchise. We believe
it extremely important to retain the right to regulate rates for non -pay
services.
Franchise Renewal
Mr. Chairman, Mayors also have a very deep sense of concern regard-
ing the franchise renewal sections of. S.66. We strongly believe that
5
although S.66 contains some caveats and attempts at balance. it neverthe-
less contains a presumption for renewal of the existing franchise that in
many cases would be difficult to rebut, and would undoubtedly place the
burden of proof on the city government. Franchise agreements are long --
usually some 15 years -- ample time for a cable company to make and re-
coup its full investment with considerable profit. Cities should have
the option at that point, particularly given the promised advances in
franchise sophistication and technology, to start fresh without proving
insufficiency on the part of the existing franchisee, and leaving itself
open to potential court challenges. If an existing franchisee is up to -
the competition, then the marketplace will prevail in its favor.
Enforcement of Existing Franchise Agreements and Contracts
Another troublesome aspect of S.66 to Mayors concerns what S.66
refers to as significant change(s) in circumstances." What this
term refers to is the cable operator's ability patently to renege on
earlier contractual commitments agreed to during the franchising process
and subsequent franchise agreement. At face value, such a requirement
seems relatively innocent, especially when explained in terms of examples
like The Entertainment Channel, CBS Cable, or the changing fee structure
y;.
of the Copyright Royalty T„ibunal.
This "changed circumstances” provision is a potential. Pandora's box
t "
for cities. If the cable company truly believes that circumstances have r'
changed significantly enough to warrant a change of service, then that
should be the subject of negotiations between the franchising authority.
and the company, and not a unilateral decision on the part of the company..
1
t'
6
This type of one-sided action could pose a real and grave; threat to the
integrity of the franchising process. No simple waiver of contractual
commitments should be permitted.
F
b'
Retroactivity
Mr. Chairman, any cable legislation undertaken by this Subcommittee
should "grandfather" existing franchises, their terms and conditions,
and franchise processes in which an RFP has been issued or franchise
applications have been accepted. Franchises were freely entered into by
both parties. Possible accommodations in the future could be made. But
any attempt on the part of federal legislation to make "null and void"
any aspect of franchises is clearly wrong and not in the public interest..
Third Party Access
Federal legislation should also not curtail the ability of cities Y
J K.'•
and cable companies to negotiate levels for third party, public, govern-..
mental, and leased access channels. This is the very heart of designing
and implementing a franchise which fits the public interest and ensures-
that
nsures that cable will reach its potential to serve our communities. While
federal floors may be appropriately considered, certainly.federal csil L;
ings would be inappropriate.
t z f{• '.
Conclusion s Y�
Mr. Chairman. on behalf of the U.S. Conference of Mayors,. I.wish -,
to express appreciation for having the opportunity to present our. views
this morning. We believe that the case has not been made for cable
legislation, although we fully understand the tumultuous factors which
have induced it in the Senate. We urge that if you decide to proceed,:::
ti
c,
VIII r A"
,.pyo ti J
that it be with caution, in an open atmospher-, and with due consider-
ation to all of the elected officials whose primary concern is the
public interest.
have.
I would be pla;,ad to take any questions the Subcommittee might
N
SACRA ENTO METROALITAN
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BUITE 3500. 700 •N• ST.. SACRAMCNTO. OA 7:814 . (916)
June 2, 1983
Toy Mayor and Council
City Manager
From: Speranza Avram, Cable Coordinat
U.S. Conference of Mayors Cable Task Force
Subject: S.66 FAN OUT NETWORK REPORT-
Action
EPORT
Action Reouested
Please:
ROBERT E. SMITH
CACCUVIVC 0146CTOA
I. Contact Senators Alan Cranston and rete Wilson by June 13 and urge them
';o support the Amendments to S.66 submitted by Senatorsauaufe berg, Exon, Bos-
chwitz and Durenberger. A letter from. the U.S. Conference of Mayors outlining
their position is attache,. A full explanation of the amendments will be sub-
mitted to the Senate tF+-_ week of June 6th.
2. Contact Repr-esentatives Jim Bates, Carlos Moorhead, Henry Waxman, and
your own Congressman in support of preparing a cable communications bill
that would protect state and local decision making -and freely negotiated
commitments regarding cable franchises and refranchising. Please indicate
support for the U.S. Conference of Mayors "framework" for a cable communi-
cations law.
3. Contact your State Senator(s) and Assembly Member(s) to support Assembly
Joint Resolution 60 memorializing Congress to amend S.66 to protect state
and Focal authority over cable franchises cnd to protect the cable consumers
from cable operator abuses.
Background and Develo�ts
Efforts are underway In .the Senate to further delay a emote on S.66 unt i I the
week of June 20 As of now, however, debate and voting on S.66 is scheduled
for June 13-14. Senators Laute,►berg, Exon, Boschwitz and Durenberger have
submitted amendments which improve S.66 siightly. Senators 'Wilson and Cranston
need to hear by June 13 that your city'supports these amendments.
The House Telecommunicaticns Subcommittee held the first day of hearings
last week on a federal cable communicat-ions bili. Representatives Bates,
S.66 Fan Out Repo 1
Page 2
Moorhead andWaxman are members of the House Subcommittee. A cable Industry -
Initiated effort is underway to have a House cable bill reflect the provisions
of 5.66. it is important that we contact our Congressional representatives
in support of the U.S. Conference of Mayors "framework" for a cable communi-
cations bill. The U.S. Conference framework supports local authority.
The National League of Cities will reconsider the S.66 "compromise". The
"compromise" has been increasingly renounced by American cities. Over 125
cities and four state leagues, including the League of California Cities, have
rejected the "compromiso" in favor of a more even-handed federal cable bili.
Last weekend, the 63 -city California Contract Cities Association voted unani-
mously for a resolution opposing S.66 in its current form and calling for con-
structive amendments to protect local authority and cable subscribers. NLC's
Transportation and Communications Steering Committee will reconsider the "com-
promise" June 3-4 in Washington, D.C. The NLC Board of Directors will review
the "compromise" in July. The original "compromise" was taken to the NLC Board
of Directors without recommendation from the NLC's Cable Task Force or Trans-
portation and Communications Steering Committee. The official NLC olic ,
however, remains in support of S.66. The fact of the matter Is That a more
pressure NLC has received, the better the "compromise" has become. The "com-
promise" has been modified three times by NLG after receiving pressure from
member cities.
Assembly Member(s) Gwen Moore and State Senator Joe Montoya, who chair the
Assembly and State Senate comm ttees can cable communications have i ntrod:}ced
a bi-partisan resolution calling upon Congress to amend S.66 to protect state
and local authority over cable ccirmunications. State Senate co-sponsors of
AJR 60 are Herschel Rosenthal (D -Los Angeles), Bill Greene (D -Los Angeles),
011ie Speraw (R -Long Beach), Art Torres (D -Los Angeles) and Diane Watson
(D -Los Angeles). Assembly co-sponsors are: Doris Allen (R -Orange), Bruce
Cronzan (D -Fresno), Charles Calderon (0 -Montebello), Lloyd Connelly (D -Sacra-
mento), Jim Costa (D -Fresno), Nolan Frizzelle (R -Fountain Valley), Teresa Hughes
(D -los Angeles), Richard Robinson (D -Santa Ana), Steve Peach (D -Chula Vista) and
Byron Sher (D -Carlsbad). Please contact your members of the State Legislature
in support of AJR 60. Also contact a e Senator Joe Montoya and Assembly
Member Gwen re n appreciation of their efforts to preserve local authority
over cable communications.
Furthet Information
Don't hesitate to contact me (916-440-6661) or len Simon of the U.S. Conference
of Mayors (phone 202-293-7330) if you have any questions.
John J. Gunther
Executive Director
SUBJECT: Cable Television Legislation --
Senate Set to Vote
DATE: May 31, 1983
The Senate is set to debate and vote on S.66, "The Cable Tele-
communications Act of 1983" on June 13-14, 1983.
S.66 is based largely on an agreement reached between the
National League of Cities and the National Cable Television Association.
However, many cities have raised serious concerns about the impact of
S.66 on existing or potential cable television franchises.
U.S. Conference of Mayors' policy opposes federal legislation
which limits the power of city governments in the cable television area.
Senator Frank Lautenberg of New Jersey, joined by Senator
James Exon of Nebraska, Senator David Durenberger of Minnesota, Senator
Rudy Boschwitz of Minnesota, and other senators plan to offer several
amendments when S.66 comes to the floor on June 13. These amendments,
explained in the attached "Dear Colleague" letter, would deal with. the
areas of 1) rate regulation; 2) franchise renewal; ?) common carrier
regulation; 4) access, and 5) abrogation of third contractual duties.
While these amendments do not deal with the full scope of
city concerns, their passage would represent an improvement over S.66
as it currently stand't.
Mayors concerned over the potential impact of S.66 should
contact their senators and urge co-sponsorship and support for the
Lautenberg-Exon-Durenberger-Boschw tz amen ants. he onference of
Mayors will be indicating support for the amendments to the Senate as
improvements to the legislation, but will not be supporting S.66 on
final passage, based on our existing poli..y. Cities may wish to fol-
low a similar course in communication with Senate offices.
Please contact Len Simon, Assistant Executive WiLector, at
202!293-7330 with any questions or suggestions.
Attachment
UNITED STATES CONFERENCE OF MAYORS • 1620 EYE STREET. N.W. • WASHINGTON. D.C. 20006 • TELEPHONE: (202)293-7390
S
Dear Colleague:
lanited Mates 1$enate
COMMITTEE ON COMMERCE. SCIENCE.
ANO TRANSPORTATION
WASHINGTON. O.C. 20S 10
May 26, 1983
We are writing to seek your support of several amendments that
we believe would address significant flaws in S. 66, the Cable
Telecommunications Act of 1983. S. 66 is scheduled for floor action
June 13 and 14.
The bill is intended by its sponsors to establish a national
policy governing cable telecommunications. It would vest in the
Federal Government primary jurisdiction over cable telecommunications,
while restricting the power of State and local governments that
previously have been actively involved in the franchisin and
regulation of cable systems. The bill is designed to refieve cable
systems of twaany of their regulatory or contractual obligations.
These include the kinds and diversity of service the systems must
provide, the rates they may charge, the fees they may be r*quired
to pay to local governments, and the access they must provide to
other users of the rvstem. The bill would also establish a presump-
tion that the holder of.a cable franchise shall retail -its franchise
indefinitely.
We do not necessarily oppose a national policy on cable telecom-
munications. However, we believe the bill falls short in a number
of ways. Therefore. when the bill reaches the floor, we intend to
offer several amendments.
Rate Deregulation
In many areas of the country, cable is the only available means
of securing clear television reception. The bill would deregulate
rates in many of these far flung areas, subjecting consumers to the
monopoly power of cable operators. We believe that rates -- if they
are to be deregulated -- should be deregulated only .in areas whsre
there are available reasonablyy competitive alternatives. to cable for
reception of television signals. Consequently, we will propose an
amendment that would substantially confine deregulation to those
areas.
Moreover, even where rates may continue to be regulated under
the bill, cable ope:•ators would be guaranteed annual rate increases
equal to S percent or the increase in the regional consumer price index.
whichever isrg_eater. We -believe that if there must be a guaranteed
increase, it should b* the lesser of the two measures. We will
propose an amendment to accoiip sh that.
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Dear Colleague:
lanited Mates 1$enate
COMMITTEE ON COMMERCE. SCIENCE.
ANO TRANSPORTATION
WASHINGTON. O.C. 20S 10
May 26, 1983
We are writing to seek your support of several amendments that
we believe would address significant flaws in S. 66, the Cable
Telecommunications Act of 1983. S. 66 is scheduled for floor action
June 13 and 14.
The bill is intended by its sponsors to establish a national
policy governing cable telecommunications. It would vest in the
Federal Government primary jurisdiction over cable telecommunications,
while restricting the power of State and local governments that
previously have been actively involved in the franchisin and
regulation of cable systems. The bill is designed to refieve cable
systems of twaany of their regulatory or contractual obligations.
These include the kinds and diversity of service the systems must
provide, the rates they may charge, the fees they may be r*quired
to pay to local governments, and the access they must provide to
other users of the rvstem. The bill would also establish a presump-
tion that the holder of.a cable franchise shall retail -its franchise
indefinitely.
We do not necessarily oppose a national policy on cable telecom-
munications. However, we believe the bill falls short in a number
of ways. Therefore. when the bill reaches the floor, we intend to
offer several amendments.
Rate Deregulation
In many areas of the country, cable is the only available means
of securing clear television reception. The bill would deregulate
rates in many of these far flung areas, subjecting consumers to the
monopoly power of cable operators. We believe that rates -- if they
are to be deregulated -- should be deregulated only .in areas whsre
there are available reasonablyy competitive alternatives. to cable for
reception of television signals. Consequently, we will propose an
amendment that would substantially confine deregulation to those
areas.
Moreover, even where rates may continue to be regulated under
the bill, cable ope:•ators would be guaranteed annual rate increases
equal to S percent or the increase in the regional consumer price index.
whichever isrg_eater. We -believe that if there must be a guaranteed
increase, it should b* the lesser of the two measures. We will
propose an amendment to accoiip sh that.
Franchise Re ewal
In an effort to assure that cable franchisees will not be
treated unfairly when it comes time to renew a franchise, the bill
unduly insulates cable operators from healthy competition and fair
regulatory review. The bill imposes a burden on the local franchis-
ing authority to show why a franchise should not be renewed. Under
the bill, no state or local agency's decision would be given the
usual respect accorded by reviewing courts. Instead, any adminis-
trative decision -- regardless of procedural fairness -- would be
subjected to de novo judicial review that would be costly
and dilatory. We believe cable systems can be assured of fair
treatment without crippling reasonable regulatory oversight. We
will propose an amendment that ensures that judicial review is
de norm only where a fair and adequate hearing is not provided by
local regulators.
Common Carrier
The bill would bar the States and the Federal Government from
regulating a cable system as a common carrier or as a utility
(except to the extent the cable system provides re ular telephone
service). The bill assumes that cable systems will never occupy
a position -- like that of the local telephone untility today --
where it would offer essential services for which there are no
reasonable competitive alternatives. We are not so sure. Conse-
quently, we plan to introduce an amendment to retain residual
common carrier authority that could be exercised if circumstances
warranted it.
Access
The large number of channels in modern cable systems provide
the means to increase the diversity -of information and viewpoints
available to the public. We believe there is a national interest
in increasing diversity that can be traced back to the First
Amendment. However, the bill would leave it largely to the cable
operators' discretion whether to offer access to public and educa-
tional groups, or to businesses and other organizations that would
be prepsred to lease channels at fair market value. We believe
that a minimum friction of channel capacity should be made available
for access by other groups -- to ensure that the public enjoys the
benefit of cable's resources. Moreover, franchising authorities
should be empowered to require access by public and educational, as
well as governmental users. We will propose Amendments to accomplish
this.
Abrogation of Contractual Duties
The bill would grant to cable operators the power to abrogate
contractual duties to provide certain cable facilities or equipment
if there has been a "significant change in circumstances. We
concede that there should be some flexibility to revise the terms
of a cable operator's franchise or contract if those obligations
become burdensome. But there should be a strong presumption in
N - 3 - C
favor of the enforcement of freely accepted contractual obligations.
The term!, of any necessary contract revisions should, clearly, be a
product nr negotiation by the two .parties. Consequently, we will
support an appropriate amendment to restore the balance in favor of
mutually agreed upon contractual duties.
We believe that these amendments would improve this effort to
erect a national policy on cable telecommunications. We believe
they would ttrike a more reasonable balance between the need to
remove undue regulatory burdens, and the need to protect consumers
when normal marketplace pressures are absent and to insure that
they reap the potential benefits cable offers. Should you or your
staff have any questions. please feel free to contact us or Mitchel
Ostrer (Senator Lautenberg's Office) at 224-9713, Rich Fitzsimmons
(Senator Exon's Office) at 224-4224 or Paul Hewitt (Senawr
Durenberger's Office) at 224-4718.
X4 3 JAMES EX
AB
&x4e-hSCHWITZ
erely,
FRANK R. 1
reNBERG
DAVID DURENBERGER, ChairmaW
Subcommittee on Intergovernmental
Relations
a
S-66NETWORK FOR LOCAL Cr,BLE AU RITY
Pleas: add us to the informal "network" of California cities
W' --,-king together to protect local cable franchises and our rights
to refranchise.
City
Contact Person
Title
Street ZIP
Telephone
Our Congress Member(s) is
Return to:
Mayor Paul E. Zeltner
City of Lakewood, 5050 Clark Avenue, Lakewood CA 90712
(213) 666-9771
Federal Cable Television
Legislation and the Cities
Propc -* Resolution No. 20
Mayor Richard
Pittsburgh
Mayor Lewis C.
Tucson
S. Caliguiri
Murphy
1) WHEREAS, cable television is an important communications and infor-
mation technology for the nation's cities; and
2) WHEREAS, provision of cable television service has already proven to
be a valuable service to hundreds of communities across the
country, and holds great potential promise to all cities in
the United States; and
3) WHEREAS, the cable television industry is thriving and growing in
the United States, with large return on investment and likeli-
hood of even more considerable profit in the future; and
4) WHEREAS, local governments have had the responsibility for franchis-
ing cable television systems in their cities and for overseeing
the implementation of those franchises once awarded; and
5) WHEREAS, the franchising process has been a model of the free market-
place it work, with enormous competition between cable companies
for the privilege to provide exclusive service within a community;
and
h) WHEREAS, gable television, because it will likely enjoy exclusivity
within a community and will be the only telecommunications
medium with a direct link to the homes of citizens with its
facilities traversing the public's property; and
7) WHEREAS, the presence of a strong local government role in overseeing
of franchise agreements has worked to ensure that contractual
obligations are carried out and the public interest served; and
8) WHEREAS, the best approach to franchising, oversight of the franchise,
and resolution of problems which may occur from time to time in
carrying out franchise elements, has been the direct negotiation
between local governments and cable companies, unfettered by the
presence of third parties; and
9) WHEREAS, local governments, recognizing the need for and success of
direct relationships between cities and cable companies, have
sought to discourage unnecessary involvement in these matters
by the Congress and the Courts; and
10) WHEREAS, cities, working together and with a broad coalition of
concerned interests including representatives of labor, education,
consumers, telecommunications, rural and utility interests, have
helped to defeat in recent years broad attempts to remove local
governments from their central role in the cable television
process; and
34
•
11) WHEREAS, federal cable television legislation is again being con-
sidered by the Congress, with legislation pending before the
full Senate and hearings having commenced at the Subcommittee
level in the House of Representatives; and
12) WHEREAS, there is a possibility that a strong, bi-partisan effort
will be made by the Congress to enact federal cable television
legislation in the coming months; and
13) WHEREAS, the proposal currently pending before the full Senate is
an improvement over the versions which preceded it, and
14) WHEREAS, members of the House and Senate who have worked closely
with the nation's cities in a broad variety of areas, fully
understanding the traditional and appropriate opposition of
local governments to such legislation, will be looking to
the nation's Mayors for leadership and direction in improving
whatever proposals are forthcoming,
15) NOW, THEREFORE, BE IT RESOLVED that the U.S. Conference of Mayors
reaffirms its view that federal cable television legislation
restricting the traditional responsibilities which have been
exercised by local governments in this area is not appropriate;
and
16) BE IT FURTHER RESOLVED that if federal cable television legislation
continues as a possibility, that the U.S. Conference of Mayors
shall work to ensure that, to the extent possible:
• federal cable legislation not limit the option of local
governments to regulate the rates charged by cable
television companies for basic service, should cities
believe it in the public interest;
• federal cable legislation not limit the option of local
governments to define by negotiation with cable television
companies the definition of basic service;
• federal cable legislation provide maximum competition
in the franchise renewal process with no presumption
or expectancy of renewal on the part of the cable
company holding the franchise;
• federal cable legislation "grandfather" all existing
franchises, and their terms and conditions and all
franchise processes in which a Request for Proposal
has been issued; and that federal legislation not
apply to renegotiated franchise agreements, sign -id
within six months of enactment;
• federal cable legislation not provide cable companies
with the power to abrogate contractual obligations
based on a unilateral assertion of a sigr►ificant
change in circumstances;
35
Y
• federal cable legislation not limit the ability of
local governments to mandate public, educational,
governmental, and leased access to cable televisiun;
• federal cable legislation not limit the ability of
local governments to negotiate the purchase price of a
cable system if there is a material breach in the
franchise agreement;
e federal cable legislation not define franchise fees to
include taxes, fees, or other assessments, imposed by
the franchising authority or other governmental
authorities on cable system operators or cable sub-
scribers; and
17) BE IT FURTHER RESOLVED by the U.S. Conference of Mayers that Congress
is urged to closely examine the possibility of federal legis-
lation in the areas of minimum technical standards, minimum
privacy standards, minimum cross ownership provisions, minimum
third party access standards, and minimum standards for inter-
connection; and
18) BE IT FURTHER RESOLVED that in working with Congress in the whole
area of cable television legislation, the U.S. Conference of
Mayors shall be guided by the principle of preserving existing
municipal authority in the cable television field, which has
greotly benefited the cable television industry, the cities,
and the nation.
-
36 ,r;=
CONGRESSIONAL RECORD — SENATE
So the bill (S. 66), as amended.. was
Passed as f ollow s:
8.06
fir s! enacted by rive Senate and Howe of
Representoftres O! the United States Qf
America in Congress assembled. That (a)
this Act may be cited 1F the -Cable Tcle-
rommunicattons Act of 1993".
(b) The Communications Act of 1924 is
amended by Inserting Immediately after
title V the following new Utle:
"TTTL.E VI—CAHLL
=XCOMMUN1CATIONS ACT
"nxorrcas
"Sac. 601. The Congress hereby finds
that—
0) able systems are engaged in inter.
state commerce through the origination,
transr.,W, om dLstribulsom and dLssemina-
tion of broadband telecommunications serv-
2) the provision of broadband telecom-
munications is of concern to governmental
til U ties:
^(3) a uniform national policy for broad-
band telecommunteatlOns can serve to eUml-
nate and prevent /onnieting and counter•
productive regulations In order to allow un-
hampered growth and development of able
as a rornpeUUve medium which will be re-
sronsf a to and serve the needs andInter-
ests of the public:
" (4t competition Is a more efficient rwula-
: t'... cc ernment of the provision of di-
verse telecommurdcatlons Preview and or
competition'conUmtes to develop. the dereg-
t of tcl.corarrin! ationa services
should occur. and
'tS) recognizing the IoM standing tradi-
tion of the Congress of promoting universal
telephone service at reasonable rate:. and
recogntztng the rapid technological changes
of the types and delivery of services offered
by the telecommunications Industry. It It in
the public interest to ensure that an provid-
ers of telecommunication services ahsre In
the obligation of providing universal armee.
'•rvaroass
•'Sac. 602. The purposes of this title are
to-
.. 11) establish a national policy concerning
broadband triecommunkvUons and W en-
courage a competitive envlronmer' *or the
growth and development of broaAband tele-
cv,mmunleat ions:
(2) establish guidelines for the exercise
of Federal. State. and local rsstsLtorY w-
thorlty:
~(3) allow cable systems to be resporu)ve
to the needs and Interests of the public on
an equal basis without a competitive dtead-
vantage with other providers of telenwmtmu-
admtfons services: and
(4) eliminate government regulation In
order to prevent the imposition of sat unnee-
osary economic bwden on able systems in
theft provision of service to the public.
'brtsttrmows
"Stec. 603. for purposes of this Utle. the
term -
112) 'bask service' means the lowest cost
tier. other than a tier offetrd at a discount-
ed fee. of service which Is available to sub-
scribers for a tee and which Includes the
provision of retransmission of local broad-
cast sig>nala. public, educational. and govern-
mental proaraming and any other program -
Ing se -nice as offered by a cable operator as
part of the ter. attd specified in the frwn-
Chise agreement Y part of basic service.
which is distributed by coaxial cable or any
ether closed transmission medium;
"(2) 'basic telephone service' means two -
say voice grade communications that is
held out to the public and that would be
subject to regulation by the Cortmnission Of
any State if offered by a common carrier
subject. to whole or in pari, to title 11 of this
Act:
"(3) 'broadband telecommunications'
means any roxipt or trartsmiss)on of elec-
tromagnetic signals. including basic service.
cable service. and trlecomtmunications serv-
Ice. over ooaxW cable or any other closed
transmission medium;
"(4) 'broadcast ng' means tedecommunlcs-
lions by radto Intended to be received by the
public. directly or by the lnterwsediar7 of
relay stations;
"(S) 'cable channel' a 'ctuwawl' means
that portion of the electrommCnetic freCuen-
cy spectrum used In a able system for the
propagation of an declrosasgnetle aignal;
"(6) 'able operator' or '(able system oper-
ator' mcw)s any person or pers"m or an
agent or employee thereof. that provides
basic service. cable soviet. or idecosnmuni-
ations service over a cable system or that
dlrealy or indhrecUy ow•ur a slgttifkant in-
terest in any cable system. or that otherwise
controls or Is responsible for. through any
arrangement` the management and oper-
ation of such a cable system:
"(7) 'cable servkx' mearu the provision by
a channel programer of one-way programing
on a per channel. per prograra. or other
basis which Is distributed by eosidW cable or
any other closed trananisston on"urn, but
such term &tall not Include bade service;
"(6) 'able subscriber mesm way person
who reoelves or transmits electrmw gneW
sig..Ab distributed over a cable syWAmK
-(9) 'able system' means a facility or eorn-
hnation of facilities tender the ownership or
control of any person or petsom which con-
sist of a primary control center used to re-
celve and retsansmu. or to originate broad-
band te)eeomnsurdcatk)ns service over one
or more coaxial cables. or other closed
transmission media. from the prtaar7 oon-
tr'ol center to a point of reception at the
premises of a able subscriber. but such
term does not include: 4A) a facility or eosn-
binsUon of (stcflides that sena only to re-
t.rarimnit the television signals of teevision
broadcast stations: (B) a facihty or combina-
tion of facilities; that series Only subsetibers
In one or more multiple unit dwellings
tinder eonuaon Ownership, control, cc man.
asement; or (C) a common carrier subject to
the provislotss of cite 11 of chis Act when,
ever such carrier transmits broadband tele-
communications services other than basic
service or cable service;
"(10) 'channel programer' or 'programer'
means any person having an agreement to
Provide basic service or cable service to a
cable system operator. or any person who
S8325
leases, rents, or is otherwise authorized to
we the facilities of a cable system for the
provision of basic service Or cable service.
and such term shall include a cable system
operator to the extent that such operator.
or person or persons under common owner-
ship or control with such opers4.or. is en-
taged to the provision of such service:
"(11) 'closed tranunission medium' or
'closed transmission media' means media
havint the capacity to traatralt alectromaa-
netic signals over a common tratnsmiadon
path such as coaxial cable. optical fiber.
win. wavegulde. or other such algrtal oon-
ductor Or device;
"(12; 'franchise' mean+ a persalt, license.
ordinance. resolution. right-of-vtay, con-
tract. certificate. agreement, or almilxr au-
thorization Issued by a franchising aut sori-
ty wrtch authorizes the provlakan of basic
service. cable service.. or telecommunications
service by a cable operator;
"(13) 'franchising author.ty' means any
State. poiltkal subdivislom or agency there-
of. or any other goverrumental enUty em-
powered to ttrsnt a franchise;
•114) -grade 8 contour' meartas the field
strength of a television broadcast station
computed in accordance with regulations
promulgated by the Commission:
"tl5) 'information' means knowledge or In-
tellitence represented by any form of writ -
tog, Ngrna. siatals, picturek souncls, or other
symbols:
"(14) 'law' Includes any regulation. rule.
order, standard, policy. requirerrsent. proce-
dure, or rest icuon;
-(17) *person' means an Individual. part.
nershlp. easociation, joint stock company.
trust, corporation or any governmental au-
thority.
"vita Yeiecommunications' nota s the
b-artamislon of information by electromag-
netic mean, with or without benefit of any
dozed transmission medium, tncluding all
instrumentalities, facilities, apparatus. and
services (including the collecttoat, storage,
torwvdtng, switching. and delivery of such
information) essential to such transmission:
`(19) 'telecommuniaUorut service' means
the offering of telecommunications fariil-
tles, or of tekoommunkstlons but rich
terms shall not include basic service or cable
service; and
`(20) 'United States' means the several
Statat and territories. the District of Colum-
bia. and the possesbest of the United
Suter
`rTATOCPArT Or AVTWOa7TT
"Sac. 604 'Tbe provisions of this Utie shall
apply as follows:
**ID The Commisaton shall have jurindir.
tion u ` ►zerclse authority with respect to
broadband telecommunications In accord•
ane with the provisions of this Ute and
other applicable provisions of lay.
"(2) Nothing in this UUo! shall be con.
strued as prohibiting any State or political
subdivision or agency thereof, or franchis-
ing authority, from awarding. In accordance
with the provisions of this title. one or more
Cable franchises within Its jurisdiction.
`(2)(A) Except to the extent provided in
paragraph (B). no Cable system shall pro-
vide basic service or cable service without a
able franchise In compliance with this title-.
`(B) The provision of paragraph (A) shall
not be applicable In the cane of any eagle
system In operation on April 21. 1993.
"OWMMSHT! OR COWMOL OI CASLX rTSrMS
`enc. t141S. (a) No State or political sub dhl-
aim or agency thereof. or franchising au-
tbority. shall have the authority to prohlb
It, dinctl7 or indireetl7, the ownership of
cable systems by any person by resAon of
that person's owriership of any other media
S8326
CONGRESSIONAL RECORD — SENATE
or other Interests, including broadcast.
cable, newspaper, programing service, or
o! her printed or electronic Information serv.
lee.
-(b)(1) Notwithstanding the provisions of
subsection (a) of this section, for the pur-
pose of ensuring fair and equitable treat-
ment of Unit,d States cable enterprises
seeking access to markets In a foreign coun-
try, the Commission shall have authority to
conduct itnquiries applicable to foreign per-
sons from that country seeking access to tic)-
-tic
o-tic markets in the United States In con-
nection with the construction, ownership
and operation of able enterprises as to
whether such United States able enter-
prises are permitted fair and equitable
access to such foreign markets.
"(2) The Commission shall submit any In-
lormation obtained through such Inquiries
to the United States Trade Representative
to assW the Trade Representative in his
identification and analysis of acts. policies
or practicew which constitute significant
barriers to, or distortions of. United States
exports of services.
'-(3) For purposes of this subsection, the
term 'foreign persons' includes any inc.vidu-
al who is not a citizen of the United States,
any subsidiary (although established under
the laws of the United States or any State
thereof) of a corporation or other business
entity which was established under the laws
of a foreign country, any corporation or
other business entity established under the
laws of a foreign country, or any corpOm-
Uon or other business entity established
under the laws of the United States or any
State thereof, if 25 percent or more of the
capita; stock or equivalent ownership Is
owned or controlled by an individual who Is
nut a cuiaon of the United States or by a
corporation or other business enUty estab-
lished under the laws Of a foreign cotmtry.
or any subsidiary of a corporation or other
bus'nt-as entity established under the laws
of it foreign country.
' (c )( I) Notwithstanding the provisions of
rubiert)on (a) of this section, a State or po-
litic..: s thahislon or agency thereof, or fran-
chiicirc authority, may not acqul:e an Own-
ership Interest In any cable system pursuant
to it buy-back provisions of a franchise or re-
quire a sale of a cable systen to any other
person pursuant to a franchise, upon the ex.
I,:raaun of the franchise, unless such State.
suhilMslon, agency, authority. or person ac-
quires
oquires such ownership or interest at not less
than fair market value based upon the on-
' .. of the system. In the
event that the cable operator and a State or
political subdivision or agency thereof, or
.. a °moi ••� -°:y, ave unaW.c to agree
upon any such fair market value, then the
matter of determining fair market value
shall be submitted to binding arbitration.
For purposes of arbitration, each of the af-
fected parties shall select one arbitrator and
the two arbitrators so selected shall choose
a thud arbitrator.
•(2) Notwithstanding the provisions of
paragraph (1) of this subsection. In the
event of terminsUon for cause of a fran-
ehise due. to a material breach. a State or
political subdh'lsion or agency thereof, or
franchising authority. may acquire an owri-
ershlp interest in such able system but
only upon written rx tict of the breach, rea-
sonable opportunity to remedy the breach.
and other due process. Any such ternetna.
tion shall be subject to de novo review by a
court of competent jurisdietlon.
•'(d) 2n any case in which any such State.
subdivision. agtx)cy, or authority has or ac-
quires any such ownership or interest. such
State. subdivision. agency. or authority
shall. in no case. ow -n or (ontrol. directly or
indirectly. the content of any of the pro
graming on such cable system, except for
programing on government access channels.
unless such State or political subdivision or
agency thereof. or franchising authority. es-
tablishes an Independent board or a sepa-
rate management company. Such board or
company shall not include any State or local
office holder.
..ACCESS CPANN93A
"Sac. 808. (a) E cable system operator may
be required, as pari of the franchise request
for proposals. to dedicate or set aside chan-
nels for public, educational or governmental
users, and the able system operator may
offer In a franchise to dedicate or set aside
channels for other channel users.
••(b) The franchising authority and the
able operator may establish rules and pro-
cedures for the use of the channels set aside
or dedicated pursuant to this section.
"(c) Until such time as there Is demand
for each channel hili time for Its designated
use, public, educational, governmental. or
other channel programing may be combined
by the able system operator on one or more
channels, and to the extent time is available
on such channels, they may be used by the
cable system operator for the provision of
other services.
RWVLA1 ION OF RATES AND SZRVI to
"Six. 807. (a) Nothing In this title shall be
construed as prhibiting any State or nolitl-
cal subdivision or agency thereof, or fran-
chising authority, from establishing, fixing.
or othem-lse restricting the rates charged
by cable opera'ors—
• 0) to subs -tbers for the receipt of basic
service.
"(2) to subscribers for equipment neces-
sary for the receipt of basic service, and
„(3) to subscribers for equipment which
facilitates the reception of basic service by
hearing Impaired Individuals.
"(bx1) Any raw regulated pursuant to
this section may be trier- aced annually at
the discretion of the cable operator by an
amount not to exceed the regional consum-
er price index for the preceeding 12 months.
upon 30 days prior notice. The ability to
affect such increases shall be cumulative for
not more than 7 suexew4ve Years.
`(2) Nothwithst.anding the provisions of
paragraph (1) of this subsection, nothing in
this title shall be construed as prohibiting
any State or political subdivision or agency
thereof, or franchising authority, from pro -
witting that such automatic Increases shall
not apply to a franchise which is In exist`
ence on the date of the enactment of the
(;able Tekoorna)urication3 Act of Midi and
which provides for a fixed rate for bask
service over a specified period.
`•(c) Notwithstanding the provisions of
subseetions (a) and (b) of this section, a
cable system operator may automatically In-
crease basic service rates which exceed the
bask rates allowed pursuant to subsectkm
(a) or (b) of this section 11—
,11) such operator has requested the In-
crease in rates; and
~(3) the request b not acted on within 90
days following the date of Its receipt.
"(dXl) Notwithstanding the provisions of
stibsection (a) of this settlor, the authority
to ectabllsh, flx, or otherwise restrict the
rates charged. w subscribers for the provi.
sion of baric services set forth In subsection
(a) of thU section, except to the extent oth-
erwise provided in paragraph (2) of this sub-
section. shall not be applicable in any ..ase
where the cable system is located within the
grade B contour of not less than four televi.
sion s4mL)s of which there shall be one af•
filtate of each of the thaee ntut)or television
(nota crit:
'11) The provisions of paragraph (1) of
this subsection xhall not be applicable in tho
June 14, 1983
case of any franchise in existence prior to
the date of the enactment of the Cable
Telecommunications Act of 1983, if the
rates charged to subscribers for (he provi-
sion of basic sen'i::es are subject to regula-
tion or are restricted by any State or politi-
cal subdivision or agency thereof. or any
franchising authority. The provisions of
this paragraph relating to existing rate reg-
ulation of basic service shall be applicable
for a period of 5 years following the date of
the enactment of such Act, or for a period
equal to one -hal: of the period of the re-
maining term of such franchise, as of the
date of the enactment of such Act. which-
ever is greater. The provisions of paragraph
(1 ) shall be applicable to any renewal or
other extension of any such franchise.
"(3) The provisions of paragraph (1) of
this subsection shall not be applicable
where the able system is subscribed to by
at least 80 percent of the residences to
which able service Is available, ttntess the
able operator demonstmtes that 90 percent
Of the time, adequate on-site re-ception of
the four t:elevislon signals Is as-ailable to
more than 50 percent of the households to
which cable service to available. Such a de-
termination shall be made by the Commis.
sion. Failure by the Commission to mal.- a
determination within 110 days after the
filing of an application by the cable opera-
tor shall be deemed to bt a determination
that such satisfactory reception is avieilabie.
'•(e) No executive agency of the United
States• including the Commission, and no
State or political subdivision or- agency
thereof• or franchising authority, shall have
authority to regulate or restrict the rates
for reconnection, additional sets to the same
subscriber, or sales of equipment.
••(h No executive agency of the United
States, including the Commission. and no
State or political subdivision or agency
thereof, or franchtsinx authority, shall have
authority to regulate or restrict the provi.
sion of or nature of able services offered
over a ctble system except as provided In
section 813 of this Act.
••(gXI) No executive agency of the United
States, Including the Commisslon, and no
State or political subdivision or agency
thereof, or franchising authority, shall have
authority to regulate or restrict the provi.
sion of or nature of telecommunications
services offered over a cable system, except
with respect to the provision of basic tele-
phone service, intrastate telecommunica-
tions services, and except as provided in sec-
tion 815 of this Act.
"MA) Subject to the provisiung of sub.
paragraph (B), a State may require only the
filing of Informational tariffs for Intrastate
telecommun:; ations services that would be
subject to regulation by the ComrrLuion or
any State If offered by a common carrier
subject. In whole or In part, to title II of this
Act, which are offered over a able system.
Such Wormatianal tariffs shall specify only
the rates, terms. and cee..Ittions for the pro-
vision of service and shall tske effect on the
date Rpecifled therein.
~(B) Subparagraph (A) shall not apply to
any private telecommunications service
which Is a discrete service dedicated to a
single customer and operated by such c a.
tomer.
-M A State shall deregulate the provision
of intrastate telecommunicasions services it
It finds that such services are subject to ef.
fective eompetli ion.
~(4) For purposes of this subsection, tat in-
trastate telecommunleatlons service shall be
considered to be subject to effective compe-
tition In a particular geographic area or
market if there are reasonably available W.
ternatives. In determining whether there
LJ
JUnt 14, 1.983 CONGRESSIONAL RECORD —SENATE
are reasonably available alternatives, the
State Wall consider -
"(A) t he number and size of provider of
services:
"(S) the extent to which services are
available from providers in the relevant geo-
graphic area of market;
' (C) the ability of such providers to make
services readily available at oompsrable
rates- terms. and conditions: and
"(D) other indicators of the extent of
competition. Including affiliation of provid-
ers of services.
"(5) Nothing In paragraphs (2), (3), and
(4) 01 -this subsection shall be construed as
being applicable to basic telephone servtce.
' (h ) Nothing in this Aa shall be con-
slrued as prohibiting a franchising authori-
ty on -1 a rablr operator from specifying, in a
frarichtse as:rrement or renewal thereof,
that certain cable services shall not be Pro-
vided or shall be provided subject to condi-
tions, if such able services are obscene or
are othem-Ise unprotected by the United
States Constitution.
"(u The provisions of subsections (b), (c),
and (d) shall not apply to a franchise agree-
ment in existence on the date of enactfnent
of lh(o Act far a period of b years following
the dat- of enactment of this Act, or for the
remaining term of such franchise Lgret-
meet. whichever is greater. In any State
wl.ich has in effect, and hu had to effect
since January 1, 1983, a statutory scheme
deregulatIms rates which contains A require-
ment regarding minimal channel capacity.
ra"cHISE rErs
`Su. 608. (a) Cable operators may be re -
4w, r-4 Ir. a fmnchue to pay to a State or Po -
1:
o
1:tic-al subdivision or agency thereof, or Iran-
(.h.L:r.r cu'hora), a Ira .=Gi r Ice.
'vh)41) No franchise fee paid by a able
system operator for the privilege of holding
a franch:.sc, shall excerd an anneal Wire-
gatr of 5 pence:,: of such cable operator's
groa revenues der;ved from the operation
of the able system which is the subject of
the franchkw...
. (2) Nothing in this section shall be con.
strued as limiting fees required by A fran-
ch,4e in effect on the date of enactment of
the Cable Telecommunications Act of 1983
to be paid directly or indimtiy to entities
established for the purpose of facilitating
the use of channels set as' (e for public, edu-
cational. or governmental use.
' (c) Any able system operator MAY Paas
the cost of any increase in a franchise fee
rhrnurh to slit-A--!bers, and may designate
i.,r total it.r,cu/ar It as a aoparst , stein on
the subscribers' bills.
(d) For the purpose of this —if --
A$ ice 411.11 iiKludr alt)' tax,
fee or as essment of any kind imposed by it
franchising authority or governmental au.
thoritY on a able system operator or able
subscriber because of their status as such:
and
'•(2) 'assessment' shall not include bonds,
security funds, letters of credit. insurance.
Indemnification. penalties. liquidated dam
ages or simflar requirements which art Inci-
dental to the enforcement of the Iranchis-
Ing agreement.
"tet Nothing In this section shall be
deem±d to require a able operator to re-
negotiate the provisions of an existing frsn.
chile.
"REfrEW ALa AND ExTOt1510"
'•SEc. 809. (a) In any ase in which a able
system operator submits an application to
the franchising authority for the renewal or
other extension of such operator's franchise
authorization. the franchising arthority
shall grant such rene::al or other ritensfon
ur.irss it finds that-
. -(i) the able system operator h.as not
substantially complied with the mat_, Pial
terms of such franchise and with applicable
law, or has been convicted of a felony.
"(2) there has been a material change in
the legal. technical, or financial qualiflca-
Uons of the cable system operator that
would substantially impair the continued
provision of service by such operator.
^(3) the facilities to be provided by such
operator. Including facilities for governmen-
tal access. are unreasonable in light of the
community need for and coat of such facill-
ties;
"(4) the signal delltered by the cable
system within the control of the cable
system operator, has not generally met
technical standards as established by the
Commission: or
"(5) the proposals contained In the renew-
al application are otherwise unreasonable.
"(b) A able system operator must file for
renewal at least 24 months. but not more
than 36 months, before expiration of the
franchise. The franchising authority must
consider the renewal within 120 days of sub-
mission of the application and conduct any
proceedings necessary to adequately oonsid-
er the application.
(c) A able system ope,ator with a fran-
chise which shall expire within 24 months
alter the date of enactment of the Cable
Telecommunications Act of 1983, shalt to In
compliance with aubsmtion (b) If he files an
application for renewal within 60 days after
such date of enactment.
"(d► The franchising authority shall-
--(I) negotiate in good faith with any able
system operator retarding franchise renew-
al within 30 days after the completion of
proceedings pursuant to subsection (b): and
"(2) make a final decision on granting or
denying renewal within I2 munths after re-
ceipt of an application;
"(3) in the ase of denial of an applies-
tion-
"tA) not make the final decision for at
least 7 months from the date of receipt of
the application: and
"(B) notify the applicant by written state-
ment. within 7 days after the final decision.
of the reasons for the denial.
I(e) Any renewal applicant adversely af-
fected or aggrieved by a final decision of a
franchising authority made pursuant to sub-
section (d). or by a failure of the franchising
authority to act in accordance with subsm-
tion td). may obtsln judicial review of such
final decision in any court of competent ju-
risdiction. The existing franchise shall
remain in effect pending the completion of
such judicial review. Such judicial review
shall be de novo. unless the renewal appli-
cant has been afforded a hearing on record
before an Independent hearing examiner or
administrative law judge consistent with
State law that inquires -
"11) acequate notice:
"(2) fair opportunity for pprUclpation y
the renewal applicant, which includes-
"( A) discovery:
"(B) the filing of pleadings, motions, or
objections.
"(C) the Introduction of written or oral
testimony: and
-(D) cross-examination of opposing par-
ties: and
" (3) a written decision by tt•? examiner or
Judge based exclusively on the full record of
the hearings and statins the specific find-
ings of fact and conclusions of law on which
the decision is based.
"UNAUTHORIZED tNTEReg"1029 On RECEPTION
"Se-. 610. (a) No person or government
authority shall Intercept or receive broad.
band telecommunications unless specifically
authorized to do so by a able system opera-
tor. channel programer, or originator of
broadband telecommunications or as may
S8327
otherwise be specifically authorized by Fed
era) law.
"(b) In order to safeguard the right to p17-
vacy and security of broadband telecommu-
nicistlons, such broadband telecommunica.
tions shalt be deemed to be a 'wire commu-
nication' within the meaning of section
2810(1) of title 18 of the United States Code.
"(c) In the event that there may be any
difference between the provisions of this
section and chapter 119 of title 18 of the
United States Code, or any regulations pro
mulated thereunder. It Is the intent of the
Congress that such chapter 119 shall be
controlling.
PROTECTION OF aUlaCR1tER PRIVACY
"SEC. 611. (e-)(1) Except as provided In
paragraph (2) of this subsection. no mt le
operator, channel programer. or originator
of broadband telecommunications may use
the cable system to collect personally Identi-
fiable information with respect to a cable
subscriber, except upon the prior written or
electronic consent of that subscriber.
"(2) The provisions of paragraph (1) of
this subsection shall not apply to the coihv-
tion of information solely for billing put
poses or to monitor whether there is unau-
thorized reception of able telecommunia
Lions.
^(3) A cable operator. channel programer.
or originator of broadbaW telecommunica•
tions shall ensure that any such informa-
tion is destroyed when the information is no
longer used or to be used for -the purpose%
for which It was collected.
"(b) No able operator, channel pro-
gramer, or originator of broadband telecom-
munications shall disclose personally Identi-
fiable Information obtained pursuant tc
subsection (a) of this section with respect to
a able subscriber, or personally identifiable
Information with respect to the services pro-
vided to or received by a particular cable
subscriber by way of a able system. exr•p•
upon the prior written or electronic consent
of the subscriber, or pursuant to a lawful
court order authorizing such disclosure.
'10 If a court shall authorize or order dls
closure, the able subscriber shall be nou-
fled of such order by the person to whom
such order may lie directed. within a reason•
able period of time before the disclosure is
made. but In no event less than It calendar
days.
"(d) Each able ope•ator Fl - -l' •i
of entering ' into an agreement to protide
table telecommuniatiors. and regularly
thereafter• inform every sl�bsrrfh+ •t—
rights of the subscriber under this. section
Such Information shall include a description
of the nature of the information to be mau)-
taaned by the cable operator, channel pro•
irramer, or originator of broadband telecom-
munications, and the location and availabit-
Ity of such Information.
"(e) A cable subscriber shall have access to
all personally identifiable information re-
garding that subscriber which is collected
and maintained by a able operator. channel
programer, or originator of broadband tele-
communications. Such Information ahall be
available to the subscriber at reasonable
times and at a place designated by the cs.ble
operator, channel programer, or originator
of broadband telecommunications.
"(h Any cable subscriber whose privacy is
violated In contravention of this section.
shall be entitled to recover civil damages as
authorized and in the manner set forth in
section 2520 of title 18 of the Untt,.rl 4'at.f
Code. This remedy shall be in
any other remedy available to such sure
acriber.
S8328 CONGRESSIONAL RECORD — SEENATE
"CatKtNAL Am) CiviL uAatuly
•'Sa• 612. Nothing In this title shall be
deemed to affect the criminal or civil liahill-
ty of channrl programers or cable operators
Pursuant to the lair of libel. slander, obscen-
ity, Incitement. Invasions of privacy. false or
rnWeading advertising, or other similar
Ia"- except that cable operators shall not
Incur such liability for any program carried
On tang Public, educational. governmental. or
other cr:anr.el referred to In subsection (a)
Of section 608, or for any prorrun required
by law to be carried on any other channel.
"raooRAKING. UMVICM AND FACnLiTtaa
"Sex•. 4111. (a) No State or political subdivi-
sion or agency thereof, or franchising au-
thority, may require the provision of partic-
ular programing or other broadband serv-
le". or fscilltiea. equipment. services, or
other turas of value which are not related
to the pru.•iswn of broadband telecommuni-
cations service.
-(b) A franchising authority may require,
u part of the frx(xhbe request for propos-
Ws—
"(1)
ropos-
Ws—
"(1) channel capacity for public educe,
tional or rowinmenta►l access purposes: and
`(2) the owbAruetion of cable system facil-
tut s or provts on of other able -related
rquitnnent.
(e) A table operator nay offer. but may
not be requlred to provide. as part of basic
seri. k -r or any other tier of service—
ti) channel capacity for other access
uses: and
"t2) particular services.
-td) The (able operator may replace or
remove a particular eervk*. speeined In the
able franchise as part of the basic service
or arty other tkr of able service or teltoom.
motn"lM-u aerr*,-e In an!- mse In which
there has b,an a significant change in cir-
curnsta:nc+es eines the (able operator's offer
to provide such service. Tho cable operator
may not be required to retain a specified
service in any particular category of service
other than bask service.
"(2) In any ease In which a table Operator
xabmiu a showing that, as a result of a sig-
nificant change In ciraumstarovs, Wrtkular
facilities and muiprnent required Oy the
franchise are ec(hw-kany. technically, or
otherwise impracticable, the tranchWag au-
thority
ssthority shall enter into negotlatlous with
the cable operator for the termhstion,
modification- or deferral of such require-
ment. it sucl) terms and conditions cannot
be agreed upon within 41 days. the matter
shn`t *- su"..kted to binding arbitraUan.
tion t,Lrpoaes of arbitration, each of the af-
fected parties ahail select 1 arbitrator and
the 2 arbitrators so selected shall choose a
third arbitrator. The existing franchise pro-
visionm except for those which are the sub-
"
ubJett of arbitration. shall not be affected by
the arbitrators' final derision.
~(e) Except as provided In wttrectton (c)
of this section, a franchising avchortty may.
in socordannce with the Provisions of this
sectim enforce any offer W prof We partic-
ular bash service sed forty, in subsection (c)
or particular cable serTY.,es or tekeommunf-
cations serviose or cM*t system taeiligee or
cable -related equip mwA offered by a (able
operator PrGrvlded th.t the provtaloa of such
services. taeillw--w or eeµtipment in speelri-
caUy regvdred by the franehlee agreement.
,U) f) Notes tthstanding the precedidi provi-
siGns of tnls section. many calls In which a
fran(:birA agreement In effect an the date of
the enactment of the Cable, Talecoanmanica.
tions Act of IOU requires the cable operator
to provide particular programinc servicer.
facWthn6 eabie related equipment. or chan-
nel ap%, lWty for pecans uses, su;h requlre-
ments, subjeet to subsections (d) and (e).
Shan remain In effect for the term of the
franchise and in accordance with the provi-
sions thereof. Far purposes of this subsec-
tion. a franchise agreement containing such
requirements shall be considered to have
been In effect on such date of enactment U
ouch agreement was the result of a Iran-
chlse, proceeding for which a request for
Proposals was Originally issued. however
subsequently modified or replaced, on or
prior to September 10. I9M
`RO RaCULATrON AS COKKON CA1tRttta
"Sxc. $14. No executive agency of the
United States. including the Commission,
and no State or political subdivision or
agency thereof, or franchising authority,
shall have authority to impose on a cable
system regulation as a common carrier or a
utility to the extent that such able system
provides broadband telecommunications
service other than bask telephone service.".
QCLbanva JOtnaptCnow
Sec. 1. (a) Except to the extent othenrbe
specifically provided in title VI of the Com-
munications Act of 1934- as added by the
first section of this Act and as provided in
section 607 of such tttle. the Federal Gov-
ernment shall have exclusive jurisdiction
ager broadband telecommunlcations regard.
Ing matters covered by such title.
(b) Any law of any State or poUUcal subdi-
vision or agency thereof, or franchWns au-
thortty, in effect on the effective date of
We VI of the Communications Act p! I914.
as added by the first section. of this Act.
which Is in conflict with the provision of
subsection (a) of this section relating to the
exclusive jurisdiction of the Federal Gov-
ernment. shall be deemed superseded, ae of
the xpimUon of the 9 -month period folbe-
ing the date of the enactment of this Act.
and stall thereafter be nail sad void sad of
Iso effect.
(c) Except to the extent otherwise pro-
vided by this Act and the amendments made
thereby. any State or political subdivision or
agency thereof. or frwnchisfm authority.
may exercise jurbdicUon over matters
which are of strictly local concern and
which are necessary for reaaons of public
health, safety. and welfare. Including the
terns and oaxfitions, for the granting of a
franchise. the construction and oper%Uon of
a cable system, and the enforeenwat and ad-
mbalaratlon of a franchise.
■ear Agra ADOCTIOwAL M.
Bar— 1. Me I of the Commuakatlons Act
of 1914 Is amended by WAeerting after section
i tate foUowiag new sections:
leges Agip AMMON" atotRCO
(a) Ccmah" t with sound spec-
in=
pedtram manyemenY, alae Coattnisslon shall. to
the maximum fe(uxibk extent, eaneaurtlige
the introduction of new and addhienal serT-
kes by new, appUcints, existing neetrsees, or
other 0 m --, In any proceeding In which
new or additional services are prrlpoeed.
such cervion shall be presu, , I to be to the
public interest whenever the Commission
finds that such seniees are teehlcatly fad -
bee without cauaing sUn!ficant technt^ttl
degradation to or Interference with radio
transmissions by other licenwRiL
"Cb) Any persrn may ftle wtth ebe Com-
mb Lott a petition to establish or an applies-
Uon to offer a nea or additional services,
"(c) The Coffin Must determine,
wta
bether the w or additional service pro-
posed In a petftion or aapUc atiat la in the
paeblic inUrmt within I year atter such pati
tion or ambeatum Is tihd If the Comosk.
afore hWatea Its own peoosee is for a stew
or additional service, such proceeding must
be completed wltht a 12 months after It Is
bsitiated
June 14, 198.3
"pxCLAtATtON
•'Sttc. B. The Congress declare • !hat com-
petition is a more efficient n cul, *or than
government of the provision of ilverse com-
munications services and sex rompetltton
continues to develop. the deregulation of
communications services should occur.".
grrccTtvx OATS
Stc. 4. The provisions of this Act and the
amendments trade thereby shall take effect
upon the date of enactment of this Act.
rtZMIGNAr%ON
Stec. S. The existing title VI of the Com-
munications Act of 1934 Is redesignated as
title VII, and sections 001 through ON are
redesignated as sections 701 through 709.
respectively.
s�,
Lw-
UNITED STATES CONFERENCE OF MAYORS
1620 EYE STREET. %,0mM'EJ'T
WASHINGTON. P.C. 20006
TELEPHONE: (202) 293•7330
STATEMENT OF
THE HONORABLE BOB BOLEN
MAYOR.
. CITY OF FORT WORTH
on behalf of
THE UNITED STATES CONFERENCE OF MAYORS
on
CABLE TELEVISION AND THE CITIES
before the
SUBCOMMITTEE ON TELECOMMUNICATIONS, CONSUMER
PROTECTION AND FINANCE,;
COMMITTEE ON ENERGY AND COMMERCE
UNITED STATES HOUSE OF REPRESENTATIVES_
F
Y: -e
May 25, 1983
4 � �
.kh Tri:
Y
1
n, 1
Mr. Chairman and members of the Subcommittee, I am Bob Bolen, Mayor
of the City of Fort Worth, Texas. I am here this morning on behalf of
my city and the U.S. Ccnference of Mayors, which represents the Mayors
of the nation's principal cities.
The Conference appreciates the opportunity to present our views to
the Subcommittee this morning. Our policy on cable television is at-
tached to the back of this statement, and underscores the very strong
belief of most Mayors that an overriding need for such legislation has
;yet to be demonstrated. Without federal legislation, municipal corpor-
ations and private firms have negotiated freely in an open market for
the delivery of cable television services. The cable television fran-
chise is an example of a system working well. Where bid requirements
are excessive, or deemed too costly, cable television companies are
free to decline participation, thereby informing the city that they do
not view the city's cable market as profitable under the city's condi-
tions.
ondi-
tions. Nor are cable operators forced to sign a contract that is unac-
ceptable to them. The terms of a cable franchise agreement can be nego-
tiated openly, and if provisions are proposed that are unacceptable to
either party, no contract is signed, both parties must accept the con-
tractual document when it is signed by the respective sides. Signing the
agreement implies acceptance of its provisions.
All institutional arrangements can stand improvement. But by and
large, we believe that the cable company/local government relationship
has worked well -- the rapid wiring of urban America is good evidence
of this fact. And, where problems do from time to time emerge, we
Z
believe that the tool of negotiation has, can, and will be used to solve
those problems.
,sir. Chairman, if it is nevertheless the intention of this Subcom-
mittee to achieve federal legislation in this area, we strongly hope that
the Subcommittee will commit to the nation's Mayors now that it will be-
gin the process with an open mind and a clean slate. We, in turn, will
pledge to work earnestly with the Subcommittee and its staff to achieve
a legislative product that is consistent with the public interest. And,
Mr. Chairman, I want it to be stated very
clearly and for the record,
that the federal government does not have
a monopoly on concern for the
public interest in cable television. In
the franchising process, and
in the oversight of the implementation of
franchises, city governments
search and work for. not the narrow concerns
of what might be best:for
city governments, but for the best public
interest. The public interest
A�
has been our goal and always will be.
Mr. Chairman, it is well known that
S.66, "The Cable Telecommunica—
tions Act of 1983,' as recently reported
by the Senate Committee or,
Commerce, Science and Transportation, although
an attempt to achieve
agreement where conflict has existed, causes
problems for many cities --
those with franchises existing, and those
which hope to have franchises
soon.
While efforts to achieve a compromise
are to be commended, it must..
be understood that the negotiations which
brought about S.66 were cam-
menced by the Senate's clear threat of "a
worse bill." It is our hope
that the House, if it should decide to go
forward, would concentrate on`
3
good legislation which makes sense to cities, is fair to cable, and
will dispense with threats and coercion.
Mr. Chairman, our key concerns with S.66 could be detailed in the
following manner.
Definition of Basic Service and Rate Regulation
S.66 defines basic service as the lowest -cost tier (non -discounted)
of service which includes the must -carries and the access channels. It
is only this portion of basic cable service to which any local rate
regulation can be applied. In this definition of basic service, "com-
petitive" market is declared. and the cable rate structure is deregulated
completely. Then, what little rate regulation remains (after applying
the "four over -the -air channel criterion") is to be erased after several
years. In addition, operators are permitted automatic CPI -based rate
increases each year, making cable the only locally franchised consumer
service that is guaranteed rate increase every year. This definition of
basic service is deficient on a number of grounds. First, basic servi.Ce
must be defined, at an absolute minimum, as all non -premium (i.e., non
pay) channels available to the consumer. A further valuable step would.
entail an explicit definition of basic service in a manner that specifies,
the channel/service components of "basic service." In this mode, basic ,
service would be defined as: 1) must -carry over -the -air stations; 2)
any low-power TV stations licensed in the area, 3) all access channels;
4) any local origination channels (i.e., operator -programmed channels);
and 5) all other non -premium cable channels.
The Federal Communications Commission's pre-emption of local auth-
ority to regulate pay -service rates makes it imperative that local
4
governments retain the ability to regulate non -pay service rates. As
it now stands, cable operators are free to escalate pay -service prices
without limit (notwithstanding the "market"), to the point that in many
cable systems, CATV operators receive from subscribers double and triple
the price the operator pays to the pay -service providers. In this free
"market," the subscriber doesn't really have the choice of movie or
arts or sports channels -- instead, the choice is to subscribe or not
subscribe to the only such services available. Conversely, basic (non -
pay) services are received by a cable operator free of charge, or for a
few pennies per subscriber; in the vast majority of instances, the basic
cable rate clearly covers the operator's costs of payment to the basic
service supplier. Eliminating local government's authority to regulate
these basic rates only increases the cable operator's ability to eA tract
monopoly profits and surplus revenue from cabl-e subscribers.
Mr. Chairman, rate regulation is important to be retained from our
perspective, as a basic tool to protect the public interest by insuring
that the terms of the franchise agreement are being properly impleinented.
by the cable company. Most rate increases. are fairly routinely approved
-- following assessment by the city that ail else is well -- a practice
followed with respect to virtually every other franchise. We believe
it extremely important to retain the right to regulate rates for non -pay:
services.
Franchise Renewal
Mr. Chairman. Mayor: also have a very deep sense of concern regard-
ing the franchise renewal sections of.S.66. We strongly believe that
5
although S.66 contains some caveats and attempts at balance, it neverthe-
less contains a presumption for renewal of the existing franchise that a
many cases would be difficult to rebut, and would undoubtedly place the
burden of proof on the city government. Franchise agreements are long --
usually some 15 years -- ample time for a cable company to make and re-
coup its full investment with considerable profit. Cities should have
the option at that point, particularly given the promised advances in
franc4rise sophistication and technology, to start fresh without proving
insufficiency on the part of the existing franchisee, and leaving itself
open to potential court challenges. If an existing franchisee is up to
the competition, then the marketplace will prevail in its favor.
Enforcement of Existing Franchise Agreements and Contracts
Another troublesome aspect of S.66 to Mayors concerns what S.66
refers to as ... significant change(-,) in circumstances." What .this
term refers to is the cable operator's ability patently to renege `on
earlier contractual commitments agreed to during the franchising process
and subsequent franchise agreement. At face value, such a requirement
seems relatively innocent, especially when explained in terms of examples
like The Entertainment Channel, CBS Cable, or the changing fee structure
of the Copyright Royalty Tribunal. a;
t'
This "changed circumstances" provision is a potential Pandora's box,
for cities. If the cable company truly believes that circumstances have.
changed significantly enough to warrant a change of service, then that
should be the subject of negotiations between the franchising authority
and the company, and not a unilateral decision on the part of the company:' :j
. .. .......
6
This type of one-sided action could pose a real and grave threat to the
integrity of the franchising process. No simple waiver of contractual
commitments should be permitted.
Retroactivity
Mr. Chairman, any cable legislation undertaken by this Subcommittee
should "grandfather" existing franchises, their terms and conditions,
and franchise processes in which an RFP has been issued or franchise
applications have been accepted: Franchises were freely entered into by
both parties. Possible accommodations in the future could be made. But
any attempt on the part of federal legislation to make "null and void"
any aspect of franchises is clearly wrong and not in the public interest.
Third Party Access
Federal legislation should also not curtail the ability of cities
and cable companies to negotiate levels for third party, public, govern-
mental, and leased access channels. This is the very heart of designing
and implementing a franchise which fits the public interest and ensures
that cable will reach its potential to serve our communities. While
federal floors may be appropriately considered, certainly federal ceil-
ings would be inappropriate.
Conclusion
Mr. Chairman. on behalf of the U.S. Conference of Mayors, I wish,
to express appreciation for having the opportunity to present our views
this morning. We believe that the case has not been made for cable
legislation, although we fully understand the tumultuous factors which
have induced it in the Senate. We urge that if you decide to proceed.
IV .I
0
7
that it be with caution, in an open atmosphere, and with due consider-
ation to all of the elected officials whose primary concern is the
public interest.
I would be pleased to take any questions the Subcommittee might
have.