House Committee Advances Broadband Bills

Rep Michele Hoitenga
(R-Manton)
Chair, Communications & Technology

The Michigan House Communications and Technology Committee made progress toward passing two telecommunications bills that were part of a package of bipartisan bills introduced on October 12, 2017. The bills were debated further on October 24 and October 31, 2017. Having heard substantial testimony both in support of and in opposition to the bills, the Committee on December 5, 2107 voted to move an amended substitute H-2 to HB 5097 and HB 5098 out of Committee and on to the House floor.

HB 5097 addresses permitting procedures, fees and requirements that may be imposed by county road commissions on telecommunications or video service providers working within a county right-of-way. HB 5098 relates to requests by governmental entities for temporary or permanent relocation of telecommunications or video service facilities.

HB 5097 was introduced by Majority Vice-Chair Beth Griffin (R-Mattawan), Committee Chair Michele Hoitenga (R- Manton) and Minority Vice-Chair Phil Phelps (D-Flushing), along with Rep. Brandt Iden (R-Oshtemo). In its original form it would limit permit fees to $300.00 per permit or, with one exception, to $1,000.00 total for all permits per project. The exception applies to annual permit fees for road repair and maintenance, which are capped at $300 per year, but would be separate from the above fee limitations. In addition, the bill would prohibit county road commissions from requiring providers to perform or pay for studies or surveys of the right-of-way. The bill would also limit bonding requirements for providers. Only one bond could be required, and the provider would choose whether to provide an insurance bond, a cash bond, or an irrevocable letter of credit meeting the requirements of the bill. The maximum amount of any bond would be $20,000.00, and the road commission would return the bond within sixty days after the provider completes the work. The bill would also require the provider to maintain general liability insurance of $1,000,000.00 per occurrence for property damage and $1,000,000.00 per occurrence for bodily injury claims arising out of the provider’s use and occupancy of the right-of-way. However, the road commission would not be allowed to require the provider to name the county or the commission or its employees or others as additional insureds. Rep. Griffin stated that the bill “will help get government out of the way of private investment.”

Rep Beth Griffin
(R-Mattawan)
Majority Vice Chair

Much of the debate surrounding HB 5097 had to do with the potential impact of the bills on urban areas, where there may be several utilities already in the ground when a broadband project is initiated, and there may be further complications such as contamination. At the earlier hearings, Rep. Jim Runestad (R- White Lake) noted that Oakland County, in particular, has concerns of this nature. Rep. Runestad indicated that he does not want taxpayers to have to pick up costs exceeding the caps set out in the bills. Rep. Jewell Jones (D-Inkster) asked to be provided with statistics for Wayne County, which as an urban county will face similar issues. Rep. Jones wondered whether the bills could be crafted so that certain counties could be exempt. Rep. Donna Lasinski (D-Scio Township) also expressed concern about shifting costs away from “for profit” companies and onto residents. However, Rep. Gary Glenn (R-Williams Township) asked for confirmation that the broadband providers that will be affected by the bills cannot be compelled to offer the service, which is accurate. If service cannot be mandated, then high fees can discourage providers from coming in to an area.

To address the concerns expressed by Representatives and stakeholders from urban counties, Substitute H-2 to HB 5097 was drafted. Rep. Griffin called H-2 a “robust substitute,” and reported that it sets up a two tier structure so that, for example, highly populated counties can impose fees that are double those applicable in low population areas. Insurance requirements would also be higher and, in addition, provision is made for counties and providers to enter into voluntary contracts that differ from the terms of the bill. At the request of Rep. Donna Lasinski (D-Scio Township), the Committee voted to amend Substitute H-2 to clarify the meaning of the term “entity” as used in the draft. The vote to advance the substitute bill, as amended, was 7 for, 2 against, and 2 abstentions. Voting “no” were Rep. Kevin Hertel (D-St. Clair Shores) and Rep. Lasinski, while the abstentions came from Rep. Jim Tedder (R-Clarkston) and Rep. Jewell Jones (D-Inkster).

Rep Phil Phelps
(D-Flushing)

Under HB 5098, also introduced by Reps. Hoitenga, Griffin and Phelps, a city, village, township, or county, or the State Transportation Department would have to give notice to a telecommunications or video service provider at least a year before requiring a relocation of facilities. If the governmental entity does not learn of the need for the relocation a full year in advance, then the notice would have to be given within thirty days after the entity learned of the need. The governmental entity could require the provider to obtain a permit for the relocation, but would waive permit and inspection fees, and could not require the provider to conduct studies relating to the relocation. The bill provides for exceptions to normal notice requirements in the case of “acts of God” or emergencies. Rep. Hoitenga stated that providing for timely notice helps providers to create a budget and to plan.

HB 5098 was advanced in its original form by a vote of 6-3-2. No votes came from Reps. Hertel, Jones and Lasinski, and abstentions came from Rep. Runestad and Rep. Tedder.

Included in the package of bills but not addressed nor advanced on December 5 was HB 5096, which addressed fees charged to broadband service providers by drain commissioners in connection with the construction, installation, or removal of broadband facilities or equipment in the right-of-way of one or more drains. HB 5096, introduced by Minority Vice-Chair Phil Phelps, Committee Chair Michele Hoitenga, and Majority Vice-Chair Beth Griffin, would provide that for a broadband project, a drain commission may not charge the broadband service provider a fee in excess of either (A) $100.00 multiplied by the number of drain crossings affected by the project or (B) $1,000.00. The fee would be deposited with the county treasurer, who would credit the amount to the drain fund for the affected drain (or, if more than one drain, proportionally according to number of drain crossings). Representative Phelps, testifying on October 12 in support of the bill, noted that the bill would establish state-wide standards and put a stop to the “horror stories” in which projects become unfeasible due to exorbitant fees.

Links to Submitted Testimony available here