1.1                          A bill for an act 
  1.2             relating to telecommunications; authorizing city and 
  1.3             joint venture telecommunications service providers; 
  1.4             amending Minnesota Statutes 2000, section 237.20; 
  1.5             proposing coding for new law in Minnesota Statutes, 
  1.6             chapter 237; repealing Minnesota Statutes 2000, 
  1.7             section 237.19. 
  1.8   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.9      Section 1.  [237.191] [MUNICIPAL TELECOMMUNICATIONS 
  1.10  SERVICE; DEFINITIONS.] 
  1.11     Subdivision 1.  [SCOPE.] The terms in sections 237.191 to 
  1.12  237.196 have the meanings given them in this section. 
  1.13     Subd. 2.  [AGENCY.] "Agency" means the public utilities 
  1.14  commission. 
  1.15     Subd. 3.  [CITY OR MUNICIPALITY.] Notwithstanding section 
  1.16  410.015, "city" or "municipality" means any statutory or home 
  1.17  rule charter city, however organized. 
  1.18     Subd. 4.  [GOVERNING BODY.] "Governing body" means a city 
  1.19  council, except as provided in section 237.196. 
  1.20     Subd. 5.  [LOCAL SERVICE.] "Local service" has the meaning 
  1.21  set forth in Minnesota Rules, part 7812.0100, subpart 33. 
  1.22     Subd. 6.  [LOCAL SERVICE PROVIDER.] "Local service provider"
  1.23  means a telecommunications service provider that provides local 
  1.24  service. 
  1.25     Subd. 7.  [PERSON.] "Person" means any individual, 
  1.26  corporation, partnership, limited liability partnership, 
  2.1   association, company, limited liability company, business trust, 
  2.2   joint venture, or other private or public entity including the 
  2.3   state, a state agency, or other public agency, instrumentality, 
  2.4   or political subdivision of the state, however organized. 
  2.5      Subd. 8.  [TELECOMMUNICATIONS.] "Telecommunications" means 
  2.6   the electronic transmission, between or among points specified 
  2.7   by the user, of information of the user's choosing without 
  2.8   change in the form or content of the information as sent and 
  2.9   received. 
  2.10     Subd. 9.  [TELECOMMUNICATIONS SERVICE.] "Telecommunications 
  2.11  service" means the offering of telecommunications for a fee 
  2.12  directly to the public, or to such classes of users as to be 
  2.13  effectively available directly to the public, regardless of the 
  2.14  facilities used, and includes local service and high-speed data 
  2.15  transport. 
  2.16     Sec. 2.  [237.192] [LEGISLATIVE POLICY; PURPOSE.] 
  2.17     (a) The legislature finds that: 
  2.18     (1) fostering a robust economy and education system 
  2.19  throughout the state, including cities large and small, requires 
  2.20  the deployment of infrastructure for high-speed, high-capacity 
  2.21  telecommunications service for voice, video, and data 
  2.22  transmission; 
  2.23     (2) the success and growth of Minnesota cities is heavily 
  2.24  dependent upon their ability to offer these telecommunications 
  2.25  service to its businesses and residents; and 
  2.26     (3) the ability of cities, individually and jointly with 
  2.27  other persons, to provide telecommunications service without 
  2.28  unreasonable barriers to entry will encourage development 
  2.29  throughout Minnesota and foster competition in providing 
  2.30  telecommunications service and will permit cities to satisfy the 
  2.31  telecommunications service needs of the community which may not 
  2.32  otherwise be met. 
  2.33     (b) It is therefore necessary for the public health, 
  2.34  safety, and general welfare to establish procedures for the 
  2.35  commencement and operation of city telecommunications service 
  2.36  and of city joint ventures with others. 
  3.1      Sec. 3.  [237.193] [CITY POWERS.] 
  3.2      Subdivision 1.  [AUTHORITY.] A city may be a 
  3.3   telecommunications service provider upon approval by the 
  3.4   governing body of the city.  Notice of the governing body's 
  3.5   proposed action and of a public hearing on the issue must be 
  3.6   published in the legal newspaper of the city not less than 15 
  3.7   days nor more than 30 days before the governing body takes 
  3.8   action to become a telecommunications service provider. 
  3.9      Subd. 2.  [SERVICE AREA EXTENSION.] A city may extend its 
  3.10  telecommunications service throughout the city and in additional 
  3.11  areas as may be authorized by the agency, applying the same 
  3.12  standards as it may apply to other nonincumbent 
  3.13  telecommunications service providers. 
  3.14     Subd. 3.  [PROPERTY ACQUISITION.] The governing body may 
  3.15  acquire property, real and personal, as it may deem necessary or 
  3.16  appropriate for its telecommunications operations by purchase 
  3.17  or, if a price cannot be agreed upon, by condemnation. 
  3.18     Subd. 4.  [POWERS.] In providing telecommunications 
  3.19  service, the governing body may exercise the powers and 
  3.20  authority granted to a municipal utilities commission under 
  3.21  chapter 412 and, with respect to telecommunications service, a 
  3.22  city may exercise the powers granted to a municipal power agency 
  3.23  with respect to an electric project in the manner provided in 
  3.24  section 453.58.  A city may also provide Internet service to 
  3.25  city residents and in adjacent areas.  A city's Internet 
  3.26  operations are subject to the approval procedures and have the 
  3.27  powers applicable to city telecommunications service providers 
  3.28  but these services are not subject to the jurisdiction of the 
  3.29  agency. 
  3.30     Sec. 4.  [237.194] [JOINT VENTURES.] 
  3.31     Subdivision 1.  [AUTHORITY.] (a) A city telecommunications 
  3.32  provider is authorized to enter into a joint venture with other 
  3.33  cities; local, regional, or state governmental agencies; or with 
  3.34  any other person.  Joint ventures may be formed under this 
  3.35  section to provide only telecommunications service, either 
  3.36  retail or wholesale or both.  The terms and conditions of a 
  4.1   joint venture authorized by this section are subject to 
  4.2   ratification by the governing body.  These terms and conditions 
  4.3   may include the formation of a corporate or other separate legal 
  4.4   entity or entities with an administrative and governance 
  4.5   structure independent of the participants.  The corporate or any 
  4.6   other separate legal entity, if formed: 
  4.7      (1) has the authority and legal capacity and, in the 
  4.8   exercise of joint venture powers, the privileges, attributes, 
  4.9   responsibilities, and duties authorized by this section; 
  4.10     (2) is subject to the law generally applicable to the 
  4.11  organization, internal governance, and activities of the entity 
  4.12  formed; 
  4.13     (3) may exercise in connection with its property and 
  4.14  affairs, and in connection with property within its control, any 
  4.15  and all powers that may be exercised by a natural person or a 
  4.16  private corporation or other private legal entity in connection 
  4.17  with similar property and affairs; and 
  4.18     (4) is not a public body or authority, government entity, 
  4.19  municipal corporation, or political subdivision unless the joint 
  4.20  venture, including any separate legal entity if formed, elects 
  4.21  to be deemed a city telecommunications service provider for 
  4.22  purposes of federal or state law regulating utility operations. 
  4.23     Subd. 2.  [JOINT VENTURE POWERS.] (a) A joint venture 
  4.24  formed under this section has the powers, privileges, 
  4.25  attributes, responsibilities, and duties of the separate 
  4.26  utilities entering into the joint venture as the joint venture 
  4.27  agreement may provide. 
  4.28     (b) These powers include, but are not limited to, the 
  4.29  authority to: 
  4.30     (1) finance, acquire, own, construct, and operate 
  4.31  facilities necessary for providing telecommunications service to 
  4.32  wholesale or retail customers; 
  4.33     (2) combine, share, or employ administrative, managerial, 
  4.34  operational, or other staff if combining or sharing will not 
  4.35  degrade safety, reliability, or customer service standards; 
  4.36     (3) provide for joint administrative functions, including 
  5.1   ancillary services; 
  5.2      (4) purchase or sell telecommunications service at 
  5.3   wholesale for resale to customers; and 
  5.4      (5) participate as the parties deem necessary or 
  5.5   appropriate in providing telecommunications service with other 
  5.6   cities, cooperative associations, or other entities providing 
  5.7   telecommunications, public or private. 
  5.8      (c) A city, upon approval by its governing body, may 
  5.9   exercise the authority and powers granted to joint ventures in 
  5.10  this subdivision with respect to telecommunications service and 
  5.11  Internet service. 
  5.12     Subd. 3.  [POWERS LIBERALLY INTERPRETED.] Sections 237.191 
  5.13  to 237.196 must be construed liberally to effectuate legislative 
  5.14  intent and the purpose of allowing cities to operate 
  5.15  telecommunications service joint ventures with the powers 
  5.16  granted by this section.  No additional authority is necessary 
  5.17  to authorize a city to form and operate joint ventures as 
  5.18  provided in this section.  The powers conferred by sections 
  5.19  237.191 to 237.196 are in addition and supplemental to the 
  5.20  powers conferred by any other law or charter.  A joint venture 
  5.21  formed under this section, and a city's governing body relative 
  5.22  to any joint venture formed under this section, has all powers, 
  5.23  privileges, attributes, responsibilities, and duties necessary 
  5.24  or appropriate to effectuate the intent and purpose of sections 
  5.25  237.191 to 237.196 including, but not limited to, the 
  5.26  expenditure of public funds and the purchase, ownership, or 
  5.27  transfer of real or personal property in accordance with the 
  5.28  terms and conditions of the joint venture and the joint venture 
  5.29  agreement.  This section may not be construed to supersede or 
  5.30  modify any powers, privileges, or authority of a municipal 
  5.31  utility or municipal power agency participating in a joint 
  5.32  venture.  If there is a conflict or inconsistency between this 
  5.33  section and any other law or charter provision, the provisions 
  5.34  of this section prevail. 
  5.35     Sec. 5.  [237.195] [COMPETITIVE DATA.] 
  5.36     (a) A governing body may classify as private or nonpublic 
  6.1   any data concerning the provision of telecommunications service 
  6.2   by the city or a joint venture in which the city is a member 
  6.3   that would disclose existing customers, potential customers, 
  6.4   rates, proposed pricing or marketing strategies, technical 
  6.5   configurations, capacity or capabilities, or the like if the 
  6.6   governing body reasonably determines that the data constitutes a 
  6.7   trade secret, is proprietary, or that its release to the public 
  6.8   will create a material competitive disadvantage to the city.  A 
  6.9   challenge to this determination must be made by petition to the 
  6.10  agency.  A governing body may close any meeting or portion of a 
  6.11  meeting during which this private or nonpublic data is discussed.
  6.12     (b) Notwithstanding paragraph (a), quarterly and annual 
  6.13  audited financial statements of the governing body are public 
  6.14  data. 
  6.15     Sec. 6.  [237.196] [CITY TELECOMMUNICATIONS COMMISSIONS.] 
  6.16     (a) Following city council approval of the city acting as a 
  6.17  telecommunications provider as provided in section 237.193, a 
  6.18  city council may assign the governance and operation of city 
  6.19  telecommunications service to a municipal public utilities 
  6.20  commission. 
  6.21     (b) If the provider is a statutory city, the delegation may 
  6.22  be made pursuant to section 412.331.  In that event, the 
  6.23  provider of telecommunications service is a public utility for 
  6.24  purposes of section 412.351. 
  6.25     (c) If the provider is a home rule charter city, the 
  6.26  delegation may be made to the municipal public utilities 
  6.27  commission as may be provided for in the charter and that 
  6.28  commission then has all of the same powers, rights, and duties 
  6.29  with respect to telecommunications as the charter provides with 
  6.30  respect to other utilities. 
  6.31     (d) In lieu of paragraphs (b) and (c), the city council may 
  6.32  establish a separate telecommunications service commission that 
  6.33  must be organized, operate, and have the powers, rights, and 
  6.34  duties of a public utilities commission created under section 
  6.35  412.331. 
  6.36     (e) If a city council assigns the governance and operation 
  7.1   of city telecommunications service to a commission, as permitted 
  7.2   in this section, the commission is thereafter the governing body 
  7.3   for purposes of sections 237.191 to 237.196. 
  7.4      Sec. 7.  Minnesota Statutes 2000, section 237.20, is 
  7.5   amended to read: 
  7.6      237.20 [CONDEMNATION:  NOTICE, COMPENSATION, APPEAL.] 
  7.7      When a municipality decides in the manner above provided to 
  7.8   acquire an existing plant by condemnation, it shall give notice 
  7.9   to the commission which shall determine the just compensation 
  7.10  which the owner of the plant is entitled to receive from the 
  7.11  municipality.  Before deciding upon the compensation, the 
  7.12  commission shall, at a public meeting which may be adjourned 
  7.13  from time to time, hear all interested parties on the question 
  7.14  involved.  The commission shall by order fix the compensation 
  7.15  and furnish a copy of its order to the municipality and to the 
  7.16  telephone company concerned.  An appeal may be taken to the 
  7.17  district court of the county in which the plant is situated from 
  7.18  that part of the order fixing the compensation to be paid, 
  7.19  within 30 days, by either party.  The appeal shall be tried the 
  7.20  same as other appeals hereunder under this chapter.  If no 
  7.21  appeal is taken, the order of the commission shall become final 
  7.22  at the end of 30 days. 
  7.23     Sec. 8.  [REPEALER.] 
  7.24     Minnesota Statutes 2000, section 237.19, is repealed. 
  7.25     Sec. 9.  [EFFECTIVE DATE.] 
  7.26     Sections 1 to 8 are effective the day following final 
  7.27  enactment.