TLPC Releases White Paper for EFF Analyzing Municipal Rights of Way Franchising Authority in New York

(by Bethany Reece, Student Attorney)

Today the TLPC is releasing a white paper, prepared on behalf of and in collaboration with, the Electronic Frontier Foundation, which chronicles New York’s experience in the early 2000s with the telecommunications lobby’s efforts to replace historic municipal telecom franchising regimes with a centralized state franchising system. Given the increased leverage that localized franchising authority can afford to municipalities, this paper considers whether New York’s choices with respect to its regulatory regime may influence its outcomes with respect to achieving its FiOS buildout objectives, economic parity of high-speed broadband access across areas of varying income strata, and enforcing agreements with telecommunications providers.

Specifically, this paper considers the role municipal control over rights of way franchising plays in affecting the favorability of the terms ultimately negotiated with telecommunications companies for the right to use public rights of way to install and operate their networks. Those in favor of statewide franchising have argued that tight legislative restrictions on municipal negotiating authority reduce operating costs of companies, encourage new entry into markets, enhance competition, and thereby enhance consumer welfare. This hypothetical benefit has been tested across the country in states which have adopted such legislative measures. This white paper, by contrast, looks at New York’s legislative history with respect to rights-of-way proposals, and how New York’s broadband landscape has developed in light of its retention of municipal broadband franchising authority.

As part of the outcome analysis, this white paper considers the success of the cable franchise agreement that New York City entered into with Verizon in 2008. A major provision of the agreement required Verizon to deploy FiOS throughout all of New York City. This paper considers the degree to which the agreement has achieved policy objectives, and how New York’s broader regulatory scheme has impacted its ability to achieve broadband availability for its citizens.