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League of California Cities Statement Regarding AB 2987 (Nunez): Cable and Video Service

League of California Cities Statement Regarding AB 2987 (Nunez): Cable and Video Service

SACRAMENTO, CA -- (MARKET WIRE) -- 04/06/06 -- The League of California Cities today issued the following statement regarding AB 2987 (Nunez), a bill that would create a new statewide franchise for cable and video service providers:

"The League and California cities strongly support greater competition in the delivery of video and Internet services. We understand that competition will produce more affordable services and improve the quality of telecommunications services to city residents.

"We have deep concerns, however, about a number of issues in AB 2987.

'We appreciate the leadership of Assembly Speaker Nunez and Assemblymember Levine in introducing legislation designed to address the "speed to market" concerns of new video and Internet providers," said Alex Padilla, President of the League and council member in the city of Los Angeles. "We stand ready to work with these leaders and other legislators to address our concerns and ensure that Californians are provided the kind of cutting edge telecommunication services that our state needs.'"

League of California Cities Concerns with AB 2987 (Nunez)

Build Out of Telecommunications Services. We are concerned that the build out provisions in AB 2987 will not ensure that video services will be equally available throughout a community. The bill allows video service providers three years to build out video service, and to self-define the area they will service. While they are prohibited from discriminating on the basis of income, they could gerrymander their service area and thereby avoid low income areas. Local governments will not have the authority to challenge the adequacy of the service area "footprint."

Some areas may only be provided satellite or "another alternative technology" -- an option provided in the bill when the video service provider is not able to physically build out service to all areas of their service area footprint. The League is concerned that these alternatives may not be comparable to service offered in other parts of the service area.

Consumer Protection and Customer Service. The bill effectively preempts local government from adopting and enforcing customer service standards for those operators who have received a statewide franchise. This would create a two-tiered customer service standard, with local cable operators subject to local customer service standards, and new statewide franchisees exempt from these standards.

Video Services to Libraries and Schools. Currently, most local franchises require cable companies to provide services to schools and libraries. This bill would eliminate this obligation. As a result, children and community members who can't afford the services at home will lose access to these advanced broadband services.

PEG Channels and PEG Support. Local agencies would lose control over the determination of the number of public, education and government (PEG) channels needed to properly meet a community's needs.

Public Rights-of-Way. It is not clear that local communities would retain their full control over access to local right-of-way. The League believes that the taxpayers' investment in the public right-of-way must be protected with clear city authority over access to the right-of-way.

Revenues. AB 2987 does not ensure that cities will be "kept whole" in regard to franchise revenues. While the bill upholds a city's ability to impose a utility user tax, local agencies appear to be prohibited from imposing other local fees and taxes, such as business license taxes, encroachment permit fees and building permit fees.

Megan Taylor
(916) 658-8228
Cell: (916) 705-6679

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