WASHINGTON-In a potential test case of a 1993 law that pre-empted state entry and rate regulation of commercial mobile radio services, U S West Inc. has asked federal regulators to declare illegal two local ordinances enacted by Roseville, Minn.
The two measures, among other things, levy annual fees on wireless carriers and give Roseville the option of buying companies’ wireless systems at the end of a five-year franchise term-or right in the middle of the 10-year license granted by the Federal Communications Commission.
The ordinances were enacted last year, though only one is actually in effect now. The other becomes effective if the first is found invalid.
“Absent prompt Commission action on this petition, other municipalities will be encouraged to enact similar restrictive ordinances in the hope of generating a new revenue source,” said U S West in its petition.
Roseville says the fact that U S West offers cellular service in the city proves its ordinances do not restrict entry.
“As U S West knows that the ordinances do not inhibit entry, its true intentions surface,” said Roseville. “This intention is one of it being able to use the public streets and rights-of-way for private economic gain without compensating the City.”
While Congress pre-empted state entry and rate regulation of CMRS in 1993 legislation, it left states the right to set other terms and conditions of commercial wireless operations. Several states earlier this year sought FCC permission to preserve now-prohibited regulations, but all were turned down.
The wireless telecommunications industry believes a 1994 Governing magazine article titled, “From Fancy New Phones, Big Local Revenue Possibilities,” reflects where cities and states are headed as thousands of next-generation paging and pocket telephone licenses are sold by the FCC.
“If city governments get their acts together now,” the article says, “they can ensure that an innovative communications service soon to appear throughout the country will do more than offer telephone service to people on the run. It also can make hefty annual contributions to municipal treasuries.”
The Cellular Telecommunications Industry Association said “it would be wholly inconsistent with the FCC’s authority to insure the development of a nationwide wireless telecommunications infrastructure and encourage the efficient use of scarce spectrum … to permit the City of Roseville to regulate CMRS rate and entry.”
The Personal Communications Industry Association urged the FCC to provide direction on the issue. “A clear articulation of these baseline policies would allow CMRS licensees to have a better understanding of their rights in deploying their service offerings and would provide state and local governing bodies with a clearer statement of their permissible regulatory options.”
The Sprint Telecommunications Venture, a partnership of Sprint Corp. and cable TV giants Tele-Communications Inc., Cox Corp. and Comcast Corp. that paid $2.1 billion for 29 licenses in the first broadband PCS auction that ended in early March, warned that “proliferation of state and local ordinances like the Roseville ordinances would seriously damage STV’s plans to establish a seamless, nationwide PCS network.”
Sprint paid $39.6 million for the Minneapolis-St. Paul license, which encompasses Roseville. The FCC is expected to receive additional public comment on the controversy early next month.
