SB 284 Authorizes statewide video service franchise agreements
Sponsor: Griesheimer Co-Sponsor(s)
LR Number: 0368L.06T Fiscal Note: 0368-06
Committee: Commerce, Energy and the Environment
Last Action: 3/22/2007 - Signed by Governor Journal Page: S605
Title: HCS SS SCS SB 284 Calendar Position:
Effective Date: August 28, 2007
House Handler: Dempsey

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Current Bill Summary

HCS/SS/SCS/SB 284 - This act authorizes state-issued video service franchising. A video service authorization will be required for a person to provide video services within political subdivisions of the state. In order to receive a video service authorization, a video service provider or incumbent cable operator must file an application with the public service commission and provide notice to the political subdivision to receive the service. Within thirty days of receipt of an application, the public service commission must issue a video service authorization to the applicant. The video service authorization will include a grant of authority to provide service in the political subdivisions set forth in the application and a grant of authority to construct video service networks across or along public rights-of-way.

A person providing video service under a franchise agreement in effect prior to the effective date of the act may: continue to provide services under the provisions of the existing franchise agreement until its expiration; apply for a video service authorization as provided under the act; or if competition exits in the franchise entity served, automatically convert the existing franchise into a state-issued video service authorization upon notice to the public service commission and the affected political subdivision.

Political subdivisions are prohibited from placing any additional requirements upon a person holding a video service authorization other than provided in the act. A person holding a video service authorization must comply with all Federal Communications Commission requirements regarding distribution and notification of emergency messages over the emergency alert system applicable to cable operators.

A video service authorization will terminate upon notice to the public service commission and affected political subdivisions, by the holder of the authorization, that such person will no longer provide service under the authorization.

Political subdivisions are allowed to collect a video service provider fee equal to not more than five percent of the gross revenue from each video service provider providing service in the political subdivision. The video service provider fee shall be the same for all video service providers providing service within the same franchise entity. Video service providers will pay the video service provider fee at the same rate assessed on incumbent cable providers immediately prior to the effective date of the act. Political subdivisions will be allowed to make necessary adjustments to the video service provider fee's rate once a year upon ninety days notice to the video service provider.

The video service provider fee must be paid to each political subdivision served on or before the last day of the month following the end of each calendar quarter. Video service providers may pass the tax and any support required for PEG programming on to customers, provided they are listed as a separate line items on subscriber bills.

Political subdivisions are provided audit authority over video service providers. Political subdivisions may audit video service providers providing service within their respective political subdivisions once per year with the cost of any such audit to be paid by such political subdivision. Law suits arising out of disputes relating to the amount of video service provider fees alleged to be due must be commenced within two years following the end of the quarter to which the disputed amount relates. Failure to file within the two year statute of limitations will result in the payments being deemed to have been made in full.

Political subdivisions are prohibited from employing anyone that is dependent upon the outcome of an audit conducted upon a person holding a video service authorization. Video service providers are not required to retain financial records associated with the payment of video service provider fees longer than three years unless an action has commenced regarding such payment.

Upon ninety days notice, a political subdivision may require certain video service providers to adopt customer service requirements consistent with federal regulations. Video service providers must adopt informal processes for handling customer concerns. In the event an issue is not resolved, the act allows for confidential non-binding mediation with costs to be shared equally among the political subdivision and video service provider. In the case of repeated, willful, and material violations of the customer service standards provided in the act, a franchise entity may file a complaint with the administrative hearing commission on behalf of a aggrieved resident. The decision of the administrative hearing commission may be appealed in court of competent jurisdiction. Franchise entities are prohibited from filing a complaint seeking revocation unless sixty days notice was provided to the video service provider to cure alleged breaches.

The public service commission is required to make annual reports on developments resulting from this act for the next three years. Video service providers are required to indemnify political subdivisions from causes of action resulting from certain acts or omissions of the video service provider.

Video service authorizations are fully transferrable upon notice to the public service commission and affected political subdivisions. Political subdivisions may require up to three channels be designated by a video service provider for public, educational, or governmental (PEG) use dependent upon the population of the franchise entity. Incumbent cable operators will be subject to the provisions of the act regarding designation of channels for PEG use.

Designated PEG channels that are not substantially utilized may be terminated at the video service provider's discretion. Terminated PEG channels will be made available to political subdivisions within one hundred and twenty days of a determination being made by the governing body of such political subdivision that the channel will be substantially utilized. The expense of providing PEG channels shall be the sole responsibility of the political subdivision receiving the benefit of such channels. Political subdivisions must provide transmissions for PEG use in a compatible format for transmission by the video service provider without further alteration.

Video service providers will have the same obligations to support PEG access facilities as the incumbent cable operators. Video service providers are prohibited from discriminating with regard to provision of services based upon race or income. Within three years of providing video service, video service providers must provide at least twenty-five percent of its services to low income households, or within five years, thirty percent of its services must be provided to low income households.

Certain video service providers using telecommunication facilities to provide video service are required to provide service to at least twenty five percent of the households within their service area within three years of providing service under the video service authorization and not less than thirty percent within six years. A video service provider may satisfy the build-out requirements contained in the act through alternative technology if the service, functionality, and content is demonstrably similar to that provided through the provider's video service network. The public service commission may grant waivers or time extensions upon application by a video service provider.

A Political subdivision aggrieved by a video service providers failure to comply with the build-out requirements provided in the act may file suit in a court of competent jurisdiction. If such a court determines that the video service provider has failed to meet build-out requirements, the court may order the video service provider to comply within a reasonable period of time.

The act subjects video service providers to all reasonable police-power based regulations of political subdivisions regarding the placement, screening and relocation of cabinets used for the transmission of video services.

This act is similar to Senate Bill 816 (2006).