Topic:
PUBLIC UTILITIES; LEGISLATION; CABLE TELEVISION;
Location:
TELEVISION - CABLE;

OLR Research Report


January 24, 2008

 

2008-R-0066

PA 07-253 AND COMMUNITY ACCESS TELEVISION

By: Kevin E. McCarthy, Principal Analyst

You asked how PA 07-253 affects community access television (community access includes public, educational, and governmental access television).

SUMMARY

PA 07-253 requires companies that are not cable companies and that meet certain criteria to obtain a certificate if they seek to provide video programming. These companies are subject to some of the community access requirements that apply to cable companies, notably providing funding for community access operations and providing the same number of community access channels as the cable companies. But the providers are not subject to other requirements that currently apply to cable companies, including providing studios and equipment for community access. The act also provides new revenues for community access.

With limited exceptions, the act does not affect the obligations of cable companies with regard to community access television.

PA 07-253 GENERAL PROVISIONS

PA 07-253 requires companies, other than cable companies and their affiliates, that seek to provide video programming to be certified by the Department of Public Utility Control (DPUC). Under the act, these companies are called certified competitive video service providers (“providers”). The act subjects the providers to some of the requirements that apply to cable companies. But the providers are not subject to other requirements, including obtaining and renewing a franchise for a specified number of years, being subject to rate regulation, and being required to build out their systems.

Once a provider enters the service territory of a cable company, the act allows the cable company to apply for a new certificate in lieu of its existing franchise. The cable company is generally subject to the same application requirements and DPUC review as a provider. Once DPUC grants the new certificate, the cable company becomes subject to a similar type of regulation as the provider. Among other things, this means that it will no longer need to have its franchise renewed and its rates will apparently not be subject to DPUC regulation.

On November 1, 2007, DPUC granted AT&T a statewide certificate as a provider. Most of the cable companies have applied for and received the new certificates authorized by the act.

PUBLIC ACCESS

Requirements for Providers

PA 07-253 has a number of public access provisions. Under the act, within 120 days after a provider begins offering service in an area under its certificate, it must provide capacity over its video service to allow community access programming in its basic service package. The provider must provide:

1. the same number of community access channels as currently offered by the incumbent cable TV company in the area;

2. funds for community access operations in the same way as cable TV companies; and

3. for the transmission of community access programming with connectivity up to at least 200 feet from its activated wireline distribution facility, without imposing additional requirements for the creation of any content.

The community access programming must be submitted to the provider in a form compatible with the technology or protocol it uses to deliver video services over its network, and must be capable of being accepted and transmitted by the provider, without requirement for additional alteration or change in the content by the provider. This requirement may require community access operators to purchase encoders, decoders, and other equipment. The act does not specify (1) which types of community access facilities must be connected to the provider's wireline distribution system and (2) who pays for the connection.

By law, DPUC can allow a nonprofit organization to assume responsibility for community access operations; otherwise the cable TV company is responsible for these operations. Under the act, the provider and the cable company or nonprofit organization providing community access operations must negotiate in good faith regarding interconnection of community access operations where technically feasible or necessary. Interconnection may be accomplished by direct cable, microwave link, satellite, or other reasonable method. At the request of a provider, cable company, or community access provider, DPUC may facilitate the negotiation for such an interconnection.

As described above, the providers are not subject to the existing franchising laws, and cable companies can obtain a certificate in lieu of a franchise once a provider enters its franchise area. Under current law, DPUC must consider several factors in determining the length of a cable company's franchise, including the quality of its community access programming. In order to obtain a franchise for more than 10 years, the company must commit itself to provide or maintain technologically advanced equipment, facilities, and systems to enhance and promote technologically advanced educational programming. These provisions do not apply under the act's certification processes.

By implication, a provider is not subject to several community access provisions that currently apply to cable companies. These include requirements to:

1. provide facilities, equipment, and technical and managerial support to enable the production of meaningful community access programming;

2. conduct various outreach programs;

3. adopt scheduling policies that promote program diversity; and

4. comply with DPUC standards regarding community access equipment.

By law, the cable company or nonprofit organization that operates community access cannot exercise editorial control over the programming, except with regard to obscenity or as allowed by state or federal law. The cable company's advisory council must review all community access programming that has been the subject of a complaint. The act does not extend these provisions to programming carried by providers.

Requirements for Incumbent Cable TV Companies

Under the act, 30 days after a provider offers video service in a cable company's franchise area, the cable company may seek a certificate of cable franchise authority from DPUC. A company may also apply for this certificate (1) for its existing franchise area 30 days after a municipal electric utility, its affiliate, or subsidiary begins offering video service there under a certificate of video franchise authority (a subsidiary of the Groton municipal utility provides cable service in southeastern Connecticut) and (2) for any area that was outside of its franchise areas on or before October 1, 2007, whether or not this are is served b a provider.

Once the cable company obtains the new certificate, it is generally subject to the same requirements that apply to providers. The company continues to be subject to most of the law's requirements regarding community access, including requirements for funding community access operations. In addition, the act continues to require cable companies that are responsible for community access to:

1. provide facilities, equipment, and technical and managerial support to enable the production of meaningful community access programming;

2. carry all of the community access channels on its basic service tier;

3. conduct various outreach programs;

4. adopt scheduling policies that promote program diversity; and

5. comply with DPUC standards regarding community access equipment.

On the other hand, the act appears to exempt the companies from DPUC regulations establishing quality standards for instructional and educational channels.

The act newly requires each company or nonprofit organization to encourage the formation and development of local community access studios operated by volunteers or nonprofit operating groups.

New Funding for Community Access

The act subjects providers to the 5% gross earnings tax that applies to cable companies and direct broadcast satellite companies. It establishes a nonlapsing “public, educational and governmental programming and education technology investment account” in the General Fund. The account must be supported solely from 0.5% of the gross earnings tax from rendering cable service (including services rendered by a cable company under the new type of certificate authorized by the act), video programming service by satellite, and certified competitive video service in this state beginning October 1, 2007. Starting October 1, 2009, the proportion drops to 0. 25%.

DPUC must make half of the money in the account available to the existing local cable advisory councils and the new video advisory councils the act establishes; statewide cable and video advisory councils; public, educational, and governmental programmers; and studio operators to subsidize capital and equipment costs related to producing and procuring this programming. DPUC must allocate the other half to boards of education and other education entities for education technology initiatives. DPUC must establish eligibility requirements and procedures for applying for the allocations. By April 1, 2008, DPUC must issue a final decision on these matters, which must include any recommendations to the governor and the legislature that DPUC considers necessary with regard to the account's operation.

The act requires DPUC to extend a cable company's initial or renewal franchise by two years if the company agrees with the nonprofit community access provider serving the area to provide funds to upgrade or replace capital equipment for community access. The company must agree not to pass on the contribution in subscribers' rates or community access fees. If there are several community access providers in the franchise area, an agreement is reached when at least two-thirds of them independently reach an agreement with the company. Only the access providers that reach an agreement with the company can receive the additional funding. There can only be one extension per franchise term. It appears that these provisions are moot if a company obtains the new certificate authorized by the act, since there is no time limit on the franchise.

Other Provisions

The act allows cable franchises to require a franchise (presumably a franchised cable company) to enter into good faith negotiations to facilitate community access television interconnection with an existing or potential competitor franchise. It appears that this provision would apply if one cable company enters or seeks to enter the franchise area of another under the provisions of prior law, rather than under the act's certification provisions.

KM:ts