1.1                          A bill for an act 
  1.2             relating to telecommunications; enacting emerging 
  1.3             communications services act; encouraging development 
  1.4             and proliferation of emerging communications services 
  1.5             in Minnesota; authorizing local authorities to control 
  1.6             the use of public property and public rights-of-way by 
  1.7             communications providers; requiring rules; authorizing 
  1.8             permits, fees, and charges against gross revenues; 
  1.9             imposing a penalty; proposing coding for new law as 
  1.10            Minnesota Statutes, chapter 237A. 
  1.11  BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.12     Section 1.  [237A.01] [DEFINITIONS.] 
  1.13     Subdivision 1.  [SCOPE.] The terms used in this chapter 
  1.14  have the meanings given them in this section. 
  1.15     Subd. 2.  [COMMISSION.] "Commission" means the Minnesota 
  1.16  public utilities commission. 
  1.17     Subd. 3.  [EMERGING COMMUNICATIONS SERVICE.] "Emerging 
  1.18  communications service" means any communications service other 
  1.19  than POTS or POCS delivered to a subscriber through the use of 
  1.20  public property or public rights-of-way. 
  1.21     Subd. 4. [LOCAL AUTHORITY.] "Local authority" means a 
  1.22  Minnesota political subdivision, whether acting under its own 
  1.23  authority or in conjunction with other political subdivisions. 
  1.24     Subd. 5.  [PERMIT.] "Permit" means the authority granted by 
  1.25  a local authority to the provider of an emerging communications 
  1.26  service allowing the occupancy of public property or public 
  1.27  rights-of-way for the delivery of the service. 
  1.28     Subd. 6.  [PERSON.] "Person" means any individual, 
  2.1   cooperative, association, proprietorship, company, limited 
  2.2   liability company, firm, corporation, partnership, limited 
  2.3   liability partnership, or other for-profit organization 
  2.4   qualified to conduct business in Minnesota. 
  2.5      Subd. 7.  [PLAIN OLD CABLE SERVICE, "POCS".] "Plain old 
  2.6   cable service" or "POCS" means video transmission delivered 
  2.7   under authority granted by federal law, chapter 238, and local 
  2.8   cable communications franchises. 
  2.9      Subd. 8.  [PLAIN OLD TELEPHONE SERVICE, "POTS".] "Plain old 
  2.10  telephone service" or "POTS" means bidirectional voice 
  2.11  transmission delivered under authority granted by federal law 
  2.12  and chapter 237. 
  2.13     Subd. 9.  [SUBSCRIBER.] "Subscriber" means a consumer or 
  2.14  user of a communications service delivered through the use of 
  2.15  public property or public rights-of-way. 
  2.16     Sec. 2.  [237A.02] [LEGISLATIVE FINDINGS; POLICY.] 
  2.17     Subdivision 1.  [FINDINGS.] The legislature finds and 
  2.18  declares the following: 
  2.19     (a) Public property and public rights-of-way are valuable 
  2.20  public assets and local authorities are entitled to ensure that 
  2.21  the public is benefited by their use for private purposes. 
  2.22     (b) All similarly situated persons providing emerging 
  2.23  communications services that use public property and public 
  2.24  rights-of-way to provide those services should be treated 
  2.25  similarly by the state government and local authorities. 
  2.26     (c) In chapter 237, the legislature has established a plan 
  2.27  for the occupancy and use of public property and public 
  2.28  rights-of-way with regard to POCS and also established uniform 
  2.29  policies that will bring about development and interconnection 
  2.30  of POTS subject to reasonable state oversight. 
  2.31     (d) In chapter 238, the legislature has established a plan 
  2.32  for the occupancy and use of public property and public 
  2.33  rights-of-way and declared that it is in the public interest to 
  2.34  protect and to preserve the interests of communities with regard 
  2.35  to POCS and also has established uniform policies that will 
  2.36  bring about development and the availability of POCS subject to 
  3.1   reasonable state and municipal oversight. 
  3.2      (e) The legislature recognizes that the services offered by 
  3.3   the communications industry and the number of persons providing 
  3.4   those services are rapidly growing and changing.  A need exists 
  3.5   to develop a comprehensive state communications policy. 
  3.6      (f) It has long been the intent of the legislature to 
  3.7   ensure that emerging communications services are fully 
  3.8   accessible to every state resident, person, and public 
  3.9   institution. 
  3.10     (g) The cable television industry, telephone industry, 
  3.11  computer industry, and related industries are now able to 
  3.12  provide new services in addition to traditional POCS and POTS.  
  3.13  Thus, within the communications industry, there is a wide range 
  3.14  of persons seeking to deliver video, voice, and data services 
  3.15  bidirectionally through the use of public property and public 
  3.16  rights-of-way. 
  3.17     (h) Emerging communications services have created an 
  3.18  unaddressed competitive environment in Minnesota public property 
  3.19  and public rights-of-way.  Existing state statutes do not 
  3.20  adequately address these emerging communications services. 
  3.21     (i) Local authorities are well equipped to analyze and 
  3.22  implement the needs and interests of the local citizen and 
  3.23  consumer.  Local governmental use of communication services will 
  3.24  support business expansion, create jobs, spur economic growth, 
  3.25  and improve the overall quality of life.  Participation by local 
  3.26  authorities will protect and return taxpayers' investments in 
  3.27  public property and public rights-of-way. 
  3.28     (j) State government and local authorities have spent 
  3.29  considerable sums of public money in implementing existing 
  3.30  communications law.  These interests require legislative 
  3.31  protection in regard to emerging communications services. 
  3.32     (k) Local authorities are responsible for developing and 
  3.33  maintaining public property and public rights-of-way.  Public 
  3.34  property and public rights-of-way are valuable assets for which 
  3.35  it is appropriate for local authorities to receive reasonable 
  3.36  compensation for their use by persons for profit. 
  4.1      (l) In light of local authorities' compelling and 
  4.2   legitimate interests in ensuring broad and diverse access to 
  4.3   communications services in exchange for the occupancy and use of 
  4.4   public property and public rights-of-way by private 
  4.5   communications providers, it is appropriate to require 
  4.6   communications providers to reserve capacity for public use. 
  4.7      (m) The commission, as a state agency, is well equipped to 
  4.8   develop uniform, statewide policy in the convergence of 
  4.9   communications services.  Local authorities are well equipped to 
  4.10  implement and enforce those statewide policies. 
  4.11     Subd. 2.  [POLICY GOALS.] Major policy goals include 
  4.12  fostering development and further advances of the communications 
  4.13  industry, universality of service, and regulation of actual or 
  4.14  near monopolies.  In pursuit of these goals, use of public 
  4.15  property and public rights-of-way has been granted to private 
  4.16  interests for the purpose of furthering the development of the 
  4.17  communications business.  With these goals in mind, the 
  4.18  legislature also declares that: 
  4.19     (a) Local authorities must have the authority to require 
  4.20  emerging communications services using public property and 
  4.21  public rights-of-way to: 
  4.22     (1) obtain permits and comply with existing local standards 
  4.23  for using public rights-of-way and public property, within 
  4.24  uniform state-mandated parameters, in constructing and operating 
  4.25  facilities to distribute services within municipal boundaries; 
  4.26     (2) prohibit redlining and uphold nondiscrimination 
  4.27  standards in providing emerging communications services; 
  4.28     (3) support community access to emerging communications 
  4.29  services; 
  4.30     (4) design the local communications infrastructure to meet 
  4.31  community communications and information needs within state and 
  4.32  federal uniform standards of universality and interconnectivity 
  4.33  so that a portion of the public capacity can be delivered on a 
  4.34  city- and school district-specific basis as determined by the 
  4.35  local authorities; and 
  4.36     (5) allow local authorities to receive compensation for the 
  5.1   use of public rights-of-way and public property. 
  5.2      (b) Current local franchising authority over POCS and 
  5.3   commission-permitting authority over POCS does not adequately 
  5.4   address emerging communications services and must be 
  5.5   supplemented with local permitting authority that: 
  5.6      (1) ensures enforcement of and compliance with state and 
  5.7   federal technical and connectivity standards; 
  5.8      (2) enforces financial, technical, and legal qualifications 
  5.9   of emerging communications services providers; 
  5.10     (3) authorizes local collection of fees adequate to 
  5.11  reimburse local authorities for the use and diminution of value 
  5.12  and useful life of public rights-of-way and public property in 
  5.13  addition to reimbursement for expenses associated with 
  5.14  permitting; 
  5.15     (4) protects local interest in the management of public 
  5.16  rights-of-way and public property; and 
  5.17     (5) assures discrete delivery of certain communications 
  5.18  services to relevant constituencies within local authorities, 
  5.19  local school districts, and county boundaries. 
  5.20     Sec. 3.  [237A.03] [AUTHORITY TO USE PUBLIC PROPERTY.] 
  5.21     Subdivision 1.  [SCOPE.] This chapter applies to every 
  5.22  person using public property or public rights-of-way for the 
  5.23  purpose of constructing, operating, maintaining, offering, or 
  5.24  delivering any emerging communications services. 
  5.25     Subd. 2.  [PERMIT REQUIRED.] A person cannot offer emerging 
  5.26  communications services unless a permit is obtained from the 
  5.27  local authority.  A local authority acting under its own 
  5.28  authority or in conjunction with other political subdivisions 
  5.29  shall require a permit of any person subject to sections 237A.01 
  5.30  to 237A.06. 
  5.31     Subd. 3.  [RULES.] (a) The commission shall adopt uniform 
  5.32  statewide standards and rules to ensure that the intent and 
  5.33  policy of this chapter will be accomplished. 
  5.34     (b) By January 1, 1996, the commission shall prescribe and 
  5.35  periodically thereafter revise rules to carry out its 
  5.36  obligations under paragraph (a). 
  6.1      (c) In prescribing rules, the commission shall seek to 
  6.2   reduce the administrative burdens on subscribers, local 
  6.3   authorities, and any person required to have a permit, and 
  6.4   standardize the permitting procedure to ensure uniformity 
  6.5   throughout the state so that the process will not be unduly 
  6.6   burdensome or unduly hinder the proliferation of emerging 
  6.7   communications services in Minnesota. 
  6.8      (d) At a minimum, rules developed by the commission must 
  6.9   include the following, which must be enforced by the local 
  6.10  authorities: 
  6.11     (1) statewide minimum standards of universality and 
  6.12  interconnectivity that, wherever possible, must provide for the 
  6.13  delivery of emerging communications services beyond the 
  6.14  boundaries of local authorities to ensure public convenience is 
  6.15  met; 
  6.16     (2) a description of the permit procedures and 
  6.17  requirements; 
  6.18     (3) a process for determining local needs and evaluating 
  6.19  performance; 
  6.20     (4) interconnection requirements to attain interconnection 
  6.21  between persons providing emerging communications services, 
  6.22  where possible, within the jurisdictions of local authorities; 
  6.23     (5) provisions to ensure that all providers of similar 
  6.24  emerging communications services are subject to the same 
  6.25  requirements pursuant to this chapter; 
  6.26     (6) requirements that all existing commitments to 
  6.27  municipal, educational, and other public or community services 
  6.28  are maintained; 
  6.29     (7) requirements that providers of emerging communications 
  6.30  services shall provide services to identified discrete 
  6.31  communities within local authority, school district, and county 
  6.32  boundaries; 
  6.33     (8) requirements that ensure open access to all 
  6.34  communications architecture through the development of a 
  6.35  "seamless web" of emerging communications services delivery 
  6.36  systems; 
  7.1      (9) uniform construction and safety standards ensuring that 
  7.2   local authorities retain control over the use of and equipment 
  7.3   and facilities located on or in public property and public 
  7.4   rights-of-way; 
  7.5      (10) uniform standards that will reduce duplication of 
  7.6   equipment and facilities located on public property or in public 
  7.7   rights-of-way that are necessary for constructing, operating, 
  7.8   maintaining, offering, or delivering any emerging communications 
  7.9   services; 
  7.10     (11) uniform minimum technical standards; 
  7.11     (12) uniform customer service standards; 
  7.12     (13) procedures for the expeditious resolution of disputes 
  7.13  between permittees and local authorities, with appeal to the 
  7.14  commission; 
  7.15     (14) standards and procedures to prevent unreasonable 
  7.16  charges to subscribers; 
  7.17     (15) prohibition against discrimination of services to 
  7.18  ensure the availability of services to the broadest range of 
  7.19  subscribers without regard to income or location; and 
  7.20     (16) requirements for filing written documentation, for 
  7.21  example, location maps, with the commission and local 
  7.22  authorities by every person providing emerging communications 
  7.23  services that identifies all wires, conduits, or other equipment 
  7.24  necessary for the purpose of constructing, operating, 
  7.25  maintaining, offering, or delivering the emerging communications 
  7.26  services placed under, above, or on public property or public 
  7.27  rights-of-way. 
  7.28     Sec. 4.  [237A.04] [COMPENSATION FOR USE OF PUBLIC 
  7.29  PROPERTY.] 
  7.30     Subdivision 1.  [PERMIT FEES.] The local authority may 
  7.31  charge and collect a reasonable permit fee sufficient to recoup 
  7.32  the costs of regulation.  The fee may include not only the 
  7.33  actual costs of permitting, but also all expenses associated 
  7.34  with monitoring permit compliance, costs associated with 
  7.35  enforcing commission rules, and any diminution of value of 
  7.36  public property or public rights-of-way as a result of the 
  8.1   installation upon or continued occupancy of public property or 
  8.2   public rights-of-way. 
  8.3      Subd. 2.  [CHARGE AGAINST GROSS REVENUES.] In recognition 
  8.4   of the use of public property or public rights-of-way by a 
  8.5   person for the purpose of receiving compensation and to avoid 
  8.6   further subsidization of private entities through the free use 
  8.7   of public property and public rights-of-way, a local authority 
  8.8   may charge up to five percent of the gross revenues derived 
  8.9   directly or indirectly from the delivery of emerging 
  8.10  communications services to subscribers in the local authority. 
  8.11     Subd. 3.  [ADMINISTRATIVE EXPENSES.] The commission shall 
  8.12  collect one-half percent of the gross revenues derived directly 
  8.13  or indirectly from the delivery of emerging communications 
  8.14  services to subscribers in the local authority for 
  8.15  administrative expenses relating to the implementation of this 
  8.16  chapter and rules adopted pursuant to this chapter. 
  8.17     Sec. 5.  [237A.05] [PUBLIC SPACE.] 
  8.18     Subdivision 1.  [PUBLIC SPACE RESERVATION REQUIREMENT.] The 
  8.19  local authority may require the reservation of not more than ten 
  8.20  percent of the emerging communications services for use as 
  8.21  public space.  This ten percent reservation requirement not only 
  8.22  applies to spectrum or channel capacity, but also to the actual 
  8.23  service or technology delivered in the spectrum or channel 
  8.24  capacity exclusive of actual content.  The total reservation of 
  8.25  public space must not exceed ten percent. 
  8.26     Subd. 2.  [RULES.] By January 1, 1996, the commission shall 
  8.27  adopt rules to implement subdivision 1. 
  8.28     Subd. 3.  [AVAILABLE FREE.] The reserved public space must 
  8.29  be made available free of charge and identified at the time a 
  8.30  permit is issued. 
  8.31     Subd. 4.  [CONSIDERED PUBLIC PROPERTY.] The reserved public 
  8.32  space must be considered public property, and the providers of 
  8.33  any emerging communications services have no control over, and 
  8.34  no liability for, the content of the reserved public space. 
  8.35     Subd. 5.  [UNUSED PUBLIC SPACE.] Rules adopted pursuant to 
  8.36  this section must provide that if the local authority determines 
  9.1   that any portion of reserved public space will go unused, the 
  9.2   reserved amount may be reduced by the unused portion. 
  9.3      Subd. 6.  [TECHNICAL QUALITY.] The technical quality of 
  9.4   reserved public space must be equivalent to the highest 
  9.5   technical quality of the remaining capacity of the affected 
  9.6   communications network in all respects. 
  9.7      Subd. 7.  [ELIGIBLE ORGANIZATIONS.] The following 
  9.8   organizations are eligible for access to public space reserved 
  9.9   under this section, which must be allocated and used in the 
  9.10  discretion of the local authority: 
  9.11     (1) state and tribal governments and local authorities and 
  9.12  their agencies; 
  9.13     (2) accredited educational institutions open to enrollment 
  9.14  by the public; 
  9.15     (3) public and nonprofit libraries; and 
  9.16     (4) nonprofit organizations described under section 
  9.17  501(c)(3) of the Internal Revenue code of 1986 that are formed 
  9.18  for the purpose of providing nondiscriminatory public access to 
  9.19  noncommercial educational, informational, cultural, civic, or 
  9.20  charitable services. 
  9.21     Subd. 8.  [TERMS AND CONDITIONS OF ACCESS.] Eligible 
  9.22  organizations have access to public space at no charge for 
  9.23  installation or service if using the public space only to 
  9.24  provide educational, informational, cultural, civic, or 
  9.25  charitable services directly to the public without charge to the 
  9.26  public or advertisers for those services. 
  9.27     Subd. 9.  [RULES; ALLOCATING COSTS.] The rules of the 
  9.28  commission must provide for reasonable funding of the equipment 
  9.29  and facilities necessary for use of reserved public space, and 
  9.30  allocate all costs among all permittees, existing or new. 
  9.31     Sec. 6.  [237A.06] [PENALTY.] 
  9.32     A person who violates a provision of this chapter is guilty 
  9.33  of a gross misdemeanor.  Any term of imprisonment imposed for a 
  9.34  violation by a business organization listed in section 237A.01, 
  9.35  subdivision 6, but not an individual, must be served by the 
  9.36  senior resident officer. 
 10.1      Sec. 7.  [SHORT TITLE.] 
 10.2      Sections 1 to 6 may be cited as the "Minnesota emerging 
 10.3   communications services act of 1995." 
 10.4      Sec. 8.  [EFFECTIVE DATE.] 
 10.5      Section 3, subdivision 2; and section 5, subdivision 2, are 
 10.6   effective the day following final enactment.  The remaining 
 10.7   provisions of this act are effective January 1, 1996.