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Before the
Federal Communications Commission
Washington, D.C. 20554
In the matter of )
)
The Cable Television )
Association of Georgia, et al., )
)
)
Complainants, )
) File No. PA 01-002
v. )
)
Georgia Power Company, )
)
)
Respondent.
ORDER
Adopted: August 7, 2003 Released: August 8, 2003
By the Chief, Enforcement Bureau:1
I. INTRODUCTION
1. In this Order, we grant in part a complaint filed by
the Cable Television Association of Georgia (``CTAG'') and
certain of its members (collectively, the ``Cable Operators'')2
against Georgia Power Company (``Georgia Power''), pursuant to
section 224(b)(1) of the Communications Act of 1934, as amended
(``Act'').3 In short, the Complaint alleges that Georgia Power
imposed unjust and unreasonable conditions of attachment and
failed to negotiate in good faith with the Cable Operators
regarding reasonable terms and conditions of a pole attachment
agreement, and requests that the Commission order Georgia Power
to comply with section 224 by providing the Cable Operators
access to Georgia Power's facilities on reasonable terms and
conditions.
2. As explained below, we conclude that the Complaint
satisfies the Commission's rules and is ripe for review. We
further find that some of the terms and conditions of attachment
imposed by Georgia Power are unjust and unreasonable. We
therefore order Georgia Power to bargain in good faith with the
Cable Operators regarding just and reasonable terms to replace
those terms declared unjust and unreasonable in this Order.
Until the parties reach agreement, their prior pole attachment
agreements will continue in effect, retroactive to the dates on
which they were cancelled.
II. BACKGROUND
3. Georgia Power provides electrical power service in
Georgia and elsewhere.4 The Cable Operators attach their cables
to Georgia Power's utility poles in order to provide cable
television services to consumers.5 Toward that end, as far back
as 1990, the Cable Operators and Georgia Power entered into pole
attachment agreements governing the terms and conditions of
attachment to Georgia Power's poles.6 On June 30, 2000, Georgia
Power informed the Cable Operators that it was ``updating its
pole attachment agreements that predate the Telecommunications
Act of 1996 [``1996 Act'']'' and replacing those contracts with a
uniform new contract (``New Contract'').7 According to Georgia
Power, it had been using the New Contract to govern its
relationships with ``all new cable and telecommunications
companies since 1996,'' and, ``to avoid unfair discrimination''
and to promote administrative efficiency and consistency, it
wished to have ``pre-1996 attaching parties'' sign the New
Contract as well.8 The June 30 Letter also stated that, if the
Cable Operators did not execute the New Contract by December 31,
2000, Georgia Power would ``deem'' the Cable Operators ``to have
accepted the full terms and conditions [of the New Contract] . .
. and such terms and conditions [would] govern such attachments
and all future attachments.''9 The parties met for two hours on
October 12, 2000 to discuss the terms of the New Contract,10 but
were unable to resolve their differences. Subsequent
correspondence between the parties was not fruitful.11
4. The record reflects that the Cable Operators generally
advocated retaining provisions from their prior pole attachment
agreements with Georgia Power, and asked the utility to clarify
and explain its position on a variety of the New Contract's
terms.12 The Cable Operators also asked Georgia Power to extend
their prior agreements on a month-to-month basis.13 In response,
Georgia Power clarified two clauses and deleted two clauses that
it found to be either unnecessary or drafted in error.14 Georgia
Power declined to make additional changes proposed by the Cable
Operators, contending that the New Contract's provisions were
reasonable, and that altering the New Contract's terms would
result in ``treat[ing] CTAG's members differently'' than
``numerous . . . other entities'' that had agreed to the New
Contract's terms.15 Moreover, Georgia Power refused to extend
the prior contracts on a month-to-month basis, and stated its
intention to apply the New Contract's terms as of December 31,
2000, regardless of whether the Cable Operators had executed the
agreement by then.16 In addition, Georgia Power maintained that
it would not permit additional new attachments until the Cable
Operators executed the New Contract.17
5. The Cable Operators filed the Complaint on January 17,
2001. The Complaint alleges that Georgia Power violated section
224 of the Act by imposing unjust and unreasonable provisions in
the New Contract,18 and refusing to negotiate in good faith
regarding those provisions.19 In addition to declaratory relief,
the Complaint requests that the Commission order Georgia Power
(1) to comply with section 224 and negotiate in good faith just
and reasonable terms in a new pole attachment agreement; (2) to
reinstate and extend the parties' prior agreements until the
parties successfully negotiate a new agreement; (3) to cease and
desist from denying the Cable Operators access to Georgia Power's
facilities unless the Cable Operators accept the New Contract;
and (4) to refund all amounts paid, plus interest, that are in
excess of just and reasonable charges.20
6. Georgia Power filed its Response on February 16, 2001.
As a threshold matter, the Response argues that the Complaint
should be dismissed, because the Complaint's allegations are
unsupported and therefore do not establish a prima facie case,
and because the case is not ripe for adjudication.21 In
addition, the Response contends that the terms of the New
Contract are reasonable (especially in light of widespread safety
violations allegedly perpetrated by the Cable Operators), and
that Georgia Power negotiated with the Cable Operators in good
faith.22
7. The Cable Operators filed a Reply on March 15, 2001.
The Reply argues, inter alia, that Georgia Power's concern for
safety and pole integrity is really a ``smokescreen'' raised for
the first time in litigation and designed to mask the utility's
true motive - to promote its ``telecommunications affiliates'
service offerings . . . [which] are among the most diverse and
aggressive, if not the most, of any electric utility.''23
II. DISCUSSION
II.A. The Complaint Satisfies the Commission's Rules and
Is Ripe for Review.
8. Georgia Power argues that the Commission should dismiss
the Complaint, pursuant to sections 1.1404 and 1.1409 of the
Commission's rules,24 because the Cable Operators have not met
their burden of establishing a prima facie case that the terms
and conditions at issue are unjust and unreasonable.25 Although
the Complaint's allegations arguably could have been more
detailed, the pleading as a whole sufficiently identifies the
factual basis of the allegations.26 Moreover, the Cable
Operators attached their prior agreements with Georgia Power;27
the New Contract;28 correspondence between the parties regarding
the negotiations and the New Contract's provisions;29 and two
Declarations that affirm the Complaint's factual allegations.30
Viewing this information as a whole, we find that the Complaint
establishes a prima facie case.
9. We also reject Georgia Power's contention that this
dispute is not ripe for resolution, because the Complaint's
allegations lack factual concreteness, and because there is not
an ``actual threat of injury, constituting denial of access for
reasons other than meritorious capacity, safety, reliability, or
engineering concerns . . . .''31 Georgia Power is correct that
the Cable Operators contest the New Contract provisions in their
incipiency, rather than as enforced. This posture, however, does
not preclude the Cable Operators from challenging the New
Contract at this juncture, as section 224 expressly provides that
the Commission has jurisdiction to determine the reasonableness
of the terms of attachment.32 Indeed, nothing in the statute
requires attachers to wait until terms are enforced before
contesting their reasonableness. The parties have well-defined
disagreements as to whether specific sections of the New Contract
are lawful. Moreover, Georgia Power has prohibited the Cable
Operators from making new attachments since January 2001.33
Thus, the issues in dispute are sufficiently crystallized for us
to rule.34 The Complaint, which challenges the terms of Georgia
Power's New Contract, is thus clearly ripe for decision. We
determine below on a claim-by-claim basis the extent to which the
Cable Operators are able to demonstrate that a particular term is
unreasonable on its face (and without the benefit of factual
history regarding enforcement of the term).35
II.B. Several Provisions of the New Contract Are Unjust
and Unreasonable.
10. In the Complaint, the Cable Operators claim that a
number of the New Contract's terms and conditions are unjust and
unreasonable, in violation of section 224 of the Act.36 As
discussed below, with respect to certain provisions, we agree.
Before explaining our rationale, however, we address Georgia
Power's principal defense to the Cable Operators' claims -
preservation of safety.
1. Georgia Power's Safety Defense
11. Georgia Power contends that the terms and conditions of
the New Contract are warranted in light of numerous violations of
safety and prudent engineering procedures that the Cable
Operators have committed.37 According to Georgia Power, the New
Contract implements ``sound industry-recognized procedures for
ensuring attachments to utility poles are made in a safe and
efficient manner without compromising the integrity of vital
electric service operations.''38 Georgia Power claims that the
New Contract ``holds attaching entities responsible for the costs
and rights associated with their violations, an element necessary
to discourage violations and imprudent practices'' and to make
Georgia Power and its customers ``whole for diligently policing
and maintaining a safe distribution system.''39 Georgia Power
also suggests that the fact that some attachers have signed the
New Contract indicates the justness and reasonableness of its
provisions.40
12. While we emphatically share Georgia Power's concern
about safety, the record does not support its assertions that the
host of new contract provisions are necessary to preserve safe
operations. As an initial matter, we are struck by the fact that
Georgia Power did not emphasize during the course of negotiations
regarding the New Contract its grave concerns about the Cable
Operators' purported failure to adhere to safety standards.41 If
many contractual provisions were in fact drafted in response to
serious safety issues, Georgia Power undoubtedly would have
explained its reasoning to the Cable Operators.42 Moreover, as
the Cable Operators persuasively argue, the Response exhibits
relating to safety fall short of establishing a record of recent
safety violations by the Cable Operators to justify the terms of
the New Contract.43 Indeed, Georgia Power cannot point
definitively to a single incident of property damage or personal
injury caused by one of the Cable Operators. The closest Georgia
Power comes is to say that ``a blatant NESC violation'' by an un-
named cable company was ``the probable cause'' of a fire,44 and
that, in the past few years ``there has been a noticeable
increase of serious injuries or fatalities to cable workers or
the contractors working for cable companies.''45 Thus, while it
may be the case that the Cable Operators' attachments have caused
safety violations,46 we do not have a record in this case on
which to find that such violations are as recent, widespread and
egregious as Georgia Power claims, or that the contract
provisions Georgia Power has proposed were justified in
preventing such violations from recurring.
2. Overlashing
13. Overlashing involves an attacher tying communication
conductors to existing, supportive strands of cable on poles,
which enables attachers to replace deteriorated cables or expand
the capacity of existing facilities while reducing construction
disruption and associated expense.47 The parties' prior
contracts allowed the Cable Operators to overlash without notice
to Georgia Power, or on one day's notice, unless the overlashing
would create a bundle exceeding six inches in diameter.48 The
New Contract provision challenged by the Cable Operators requires
Georgia Power's written consent to any overlashing, which the
utility may take up to 30 days to grant or deny.49 This new
provision is unjust and unreasonable on its face. The Commission
has expressly articulated a policy promoting overlashing, and
stated that ``neither the host attaching entity nor the third
party overlasher must obtain additional approval from or consent
of the utility for overlashing other than the approval obtained
for the host attachment.''50 Georgia Power is therefore ordered
to negotiate in good faith a reasonable provision consistent with
Commission precedent.
3. Inspection Rights
14. The parties' prior agreements required the Cable
Operators to pay the costs of periodic pole surveys to occur
every five years.51 Under the New Contract, the Cable Operators
must reimburse Georgia Power for the cost of periodic inspections
- not more frequently than every 12 months or a shorter interval
recommended by ``NESC or any other industry standard.''52 The
Cable Operators are also liable for a pro rata share of the cost
of non-periodic inspections - that is, whenever Georgia Power
either discovers or reasonably suspects any violation of the
Agreement.53 The Cable Operators characterize the New Contract
as giving Georgia Power ``a near-infinite source of unreasonable
leverage over cable operators, readily susceptible to utility
abuse.''54
15. We agree with Georgia Power that it has the right to
inspect its poles to ensure they are compliant with applicable
safety standards. Consequently, we do not consider unreasonable
a provision allowing inspections when Georgia Power ``discover[s]
a safety violation during the previous regular inspection.''55
Nor, in our view, is it unreasonable for the attacher that is
responsible for the violation to bear the cost of such an
inspection. The New Contract, however, is phrased more broadly.
Rather than allowing inspections upon the discovery of a ``safety
violation,'' it provides for inspections when there is ``any
violation of this Agreement.''56 While Georgia Power seeks to
justify the provision based solely on safety concerns,57 this
provision is far broader and, in our view, unreasonable. We
therefore order Georgia Power to negotiate in good faith a
reasonable provision.
16. The Cable Operators proffered no evidence that the New
Contract's provision for routine inspections no more frequently
than every twelve months is unreasonable. In contrast, Georgia
Power presented evidence that such an interval is consistent with
industry standard.58 We therefore have no basis on this record
to find that the yearly inspection right is unreasonable.
Regardless of frequency, however, costs attendant to routine
inspections of poles, which benefit all attachers, should be
included in the maintenance costs account and allocated to each
attacher in accordance with the Commission's formula.59
Consequently, we find the New Contract's provision requiring the
Cable Operators to pay for routine pole inspections to be
unreasonable.
4. Administrative Fees
17. The Cable Operators challenge a section of the New
Contract requiring payment of Georgia Power's ``reasonable costs
and expenses in the enforcement of this agreement.''60 In
addition, this provision requires the Cable Operators to pay for
``administrative services not otherwise required to be performed
by Georgia Power under this agreement, including . . . services
related to credit facilities or consents . . . [and fees for]
outside counsel and allocated costs of inside counsel . . .
incurred in connection with any of the foregoing.''61 The Cable
Operators assert that these fees are unreasonable because they
are ``unspecified and open-ended'' and allow Georgia Power to
recover ``an excessive pole attachment rate.''62
18. We agree that this provision of the New Contract is
unreasonable. Through the annual rate derived by the
Commission's formula, an attacher pays a portion of the total
plant administrative costs incurred by a utility.63 Included in
the total plant administrative expenses is a panoply of accounts
that covers a broad spectrum of expenses.64 A utility would
doubly recover if it were allowed to receive a proportionate
share of these expenses based on the fully-allocated costs
formula and additional amounts for administrative expenses. The
allocated portion of administrative expenses covers any routine
administrative costs associated with pole attachments, such as
billing and legal costs associated with administering the
agreement. Georgia Power has not argued persuasively that
recovering these costs through direct reimbursement rather than
through the annual rental rate is preferable or reasonable.65
19. The Cable Operators also contest an up-front fee
Georgia Power imposes for make-ready work, which the utility
estimates will average $150 per pole.66 According to Georgia
Power, it applies this fee to the ``actual make-ready
construction costs, management and inspection costs, and
engineering costs required to put any attachment on a pole.''67
Since December 2000, Georgia Power has refused to allow certain
attachments unless this fee is paid up front.68
20. In deciding an analogous question under section 224(h)
of the Act, the Commission stated that ``a utility may require an
inquiring entity to reimburse the utility, on an actual cost
basis, for the actual labor and administrative costs incident to
providing maps, plats, and other data to entities making
inquiries regarding access . . . .''69 Applying the Commission's
rationale to the instant matter, we find to be unreasonable
Georgia Power's up-front make-ready fee, as well as the utility's
practice of denying access to its poles until such fee is paid.
Georgia Power first should incur the costs attendant to make-
ready, and then seek reimbursement for its actual make-ready
costs.
5. Unauthorized Attachment Fee
21. The Cable Operators challenge a provision in the New
Contract that requires them to pay, for each unauthorized
attachment, back rent (owed from the time of the last inspection
of the poles to which the unauthorized attachment was made); ten
percent of the back rent as an administrative fee; interest at
eight percent above the prime rate; and Georgia Power's out-of-
pocket expenses, including legal fees.70 According to the Cable
Operators, this provision is unjust and unreasonable, because it
subjects them to ``near-unlimited liability'' for unauthorized
attachments.71 Georgia Power claims that unauthorized
attachments are a ``serious problem throughout Georgia,''72 and
pose significant safety hazards, because loading calculations
will not have incorporated the additional weight on poles.73
Georgia Power further argues that the more onerous penalty
provisions provide the Cable Operators a needed incentive to
follow the utility's application process.74
22. Penalties for unauthorized attachments are not per se
unreasonable.75 ``Although an unauthorized attachment penalty
may exceed the annual pole attachment rate, the amount of the
penalty and the circumstances under which it is imposed must be
just and reasonable.''76 We find the New Contract's unauthorized
attachment fee to be unreasonable in several respects. First,
there is no evidence in the record demonstrating how frequently
Georgia Power inspects its poles. Therefore, a hard-and-fast
rule requiring back rent to the date of the last inspection could
grossly overcompensate Georgia Power if an unauthorized
attachment were installed long after the last inspection. While
providing for calculation based on the date of the last
inspection might be a reasonable proxy where no other information
is available, it precludes the use of more precise information
regarding attachment, which would permit an accurate calculation
of back rent. Alternatively, if the use of actual attachment
dates is not practical, a reasonable maximum period could be
included to ensure that the back rent assessment is not
unreasonable. Thus, Georgia Power must negotiate a provision
that allows for such a reasonable calculation under appropriate
circumstances.
23. Second, while it is appropriate for Georgia Power to
recover out-of-pocket expenses directly attributable to
unauthorized attachments, those expenses must be reasonable. A
provision allowing recovery of all out-of-pocket expenses,
without regard to their reasonableness, is overbroad.
24. Finally, there is insufficient record evidence allowing
us to conclude that the ten-percent administrative fee, which
Georgia Power states is a penalty,77 and the interest provision,
are either reasonable or unreasonable on their face. We will
look closely at application of provisions such as these in the
specific circumstances presented, and we will consider evidence
of industry practice to determine whether their application is
reasonable. We may conclude that application of such provisions
is reasonable only in extraordinary situations of egregious
conduct by an attacher. In any event, because of the other flaws
identified with the unauthorized attachment provision described
herein, Georgia Power is ordered to negotiate in good faith a
reasonable provision relating to fees and expenses for
unauthorized attachments.
6. Rights-of-Way and Easements
25. Section 6 of the New Contract states that the Cable
Operators have ``acquired and shall continue to acquire in
[their] own name and at [their] expense any and all easements,''
but clarifies that the New Contract does not give the Cable
Operators ``any right to use Georgia Power's rights-of-way which
must be separately agreed upon for further consideration.''78
The Cable Operators argue that, pursuant to section 621 of the
Act,79 they have the right to ``use pre-existing compatible
utility easements for the installation of their cable
facilities.''80 According to the Cable Operators, the New
Contract deprives them of that right, because they must reach a
separate agreement with Georgia Power to obtain access to any
easements.81
26. We agree with the Cable Operators, albeit on
alternative statutory grounds. Section 224 of the Act expressly
mandates that ``[a] utility shall provide a cable television
system . . . with nondiscriminatory access to any . . . right-of-
way owned or controlled by it.82
27. Georgia Power argues that not requiring the Cable
Operators to pay for ``piggybacking'' on the utility's private
easements would violate the Fifth Amendment, because it would
constitute a taking.83 We agree with the Cable Operators,
however, that because the Commission's rate formula assures that
Georgia Power receives just compensation under the Constitution,
84 the utility is not entitled to additional payment for private
easements.85
7. Security Interests
28. The Cable Operators object to section 9 of the New
Contract, which deals with security interests. Specifically, the
Cable Operators argue that sections 9.1 (requiring the Cable
Operators to furnish a bond to Georgia Power in an indeterminate
amount), 9.2 (granting Georgia Power access to the Cable
Operators' financial records, so that Georgia Power can make a
creditworthiness determination), and 9.3 (giving Georgia Power a
security interest in the Cable Operators' equipment, depending on
creditworthiness) are unjust and unreasonable terms.86
29. We agree with the Cable Operators. To be sure, Georgia
Power has an interest in ensuring that the Cable Operators
actually pay the amounts owed to Georgia Power. The
``creditworthiness matrix'' established in section 9 of the New
Contract, however, gives Georgia Power unfettered access to
sensitive financial information and unilateral authority to
determine whether an attacher is creditworthy. Based on this
determination, Georgia Power, by itself, assesses whether posting
of a bond is appropriate and, if so, in what amount. These type
of open-ended provisions invite arbitrary and anticompetitive
conduct that is antithetical to the principles underlying section
224. Moreover, Georgia Power fails to explain why provisions of
the parties' prior pole attachment agreements (e.g., requiring
the Cable Operators to provide evidence of insurance coverage or
to post a bond in a definite amount)87 afforded the utility
insufficient protection.
8. Indemnities/Limits of Liability
30. The Cable Operators object to several aspects of the
New Contract's provisions concerning indemnities/limits of
liability, namely sections 8.1 (requiring the Cable Operators to
indemnify Georgia Power from and against liability, but not vice
versa), 8.2 (placing a six-month limitation on claims against
Georgia Power), and 8.4 (allowing Georgia Power to control the
defense of claims against the Cable Operators).88 Georgia
Power's arguments in defense of these provisions miss the mark,
and we find the provisions to be unreasonable.
31. As an initial matter, Georgia Power relies generally on
the Cable Operators' allegedly poor safety practices as a
justification for the challenged provisions, claiming that it
should not be required to pay for damages it did not cause.89 As
explained above,90 however, the record in this case does not
support the safety defense. In any event, the Cable Operators do
not contend that indemnification provisions generally are
unreasonable; instead, they claim that these particular
provisions are unreasonable. Second, Georgia Power argues that,
because of mandatory access, a non-reciprocal indemnification
provision is warranted given that the Cable Operators allegedly
pose a ``far greater, and unwanted, risk'' to Georgia Power in
the pole attachment process.91 A reciprocal indemnification
provision, however, simply would result in each party assuming
responsibility for losses occasioned by its own misconduct.
Consequently, if Georgia Power is correct that the Cable
Operators more frequently are the ``bad actors,'' then the Cable
Operators more frequently would be called upon to indemnify.
Finally, Georgia Power offers no response to the Cable Operators'
argument that they should not be forced to bring claims in a
shorter period than required by law or to relinquish their right
to defend claims against them. We cannot discern any rational
basis to support those contractual provisions.92
9. Force Majeure
32. The Cable Operators complain that the New Contract's
force majeure clause should be, but is not, reciprocal.93
Specifically, according to the Cable Operators, they should not
be liable to pay rent for pole space, if a pole is unusable
because of a force majeure.94 In response, Georgia Power asserts
that the clause appropriately is one-sided, because a force
majeure should not permit the Cable Operators to ``escape
responsibility'' for carrying out their obligations to ensure
compliance with safety, reliability and engineering concerns.95
Without such a clause and in the event of a force majeure,
Georgia Power contends, it would be required to ``assume'' the
Cable Operators' obligations to attend to safety and reliability
issues.96
33. This argument is a non sequitur. By definition, a
force majeure is an event that can be neither anticipated nor
controlled.97 Thus, it makes little sense to speak in terms of
the Cable Operators ``escaping responsibility'' when safety
violations occur due to circumstances beyond their anticipation
or control. In the event of a force majeure that affects one
party's attachments, we anticipate that the party immediately
would take steps to bring its attachments into a safe condition.
34. We believe it is unreasonable for the force majeure
clause not to be reciprocal. In the event, for example, that a
pole is rendered unusable because of inclement weather, the Cable
Operators should be no more responsible for paying rental for
unusable pole space than Georgia Power should be responsible in
damages for the fact that the pole is unusable.
10. Rates
35. The Cable Operators contest the New Contract's
provision regarding rate adjustments,98 which allows Georgia
Power at the end of every year to adjust the rate for the current
year via a ``true-up'' process.99 The Cable Operators contend
that this provision contravenes the Commission's clear rule
requiring 60 days' advance notice of any pole attachment rate
increase.100 Georgia Power asserts that there is ``no reason to
presume a rate increase from this provision,'' and that, if there
is a rate increase, notice of ``any possible increase'' has been
given more than 60 days in advance.101
36. We agree with the Cable Operators that the rate
provision is unreasonable. Section 1.1403(c)(2) of the
Commission's rules states that a ``utility shall provide a cable
television system operator or telecommunications carrier no less
than 60 days written notice prior to . . . [a]ny increase in pole
attachment rates . . .''102 Blanket notice of a possible rate
increase is not equivalent to notice of an actual rate increase.
Accordingly, the New Contract's true-up provision is
unreasonable.
11. Assignments
37. The Cable Operators argue that the assignment provision
of the New Contract is unreasonable, because it is not
reciprocal, or, at a minimum, does not include an exemption for
``affiliate transfers or . . . transfers to parties that have
existing pole attachment agreements.''103 We find no merit in
this claim. First, we are persuaded by Georgia Power's argument
that, in order to maintain the safety and reliability of its pole
plant, it must ascertain the identity of all attachers, and that
reciprocity is not required, because the Cable Operators do not
have the same obligation to ensure the operational integrity of
the utility pole infrastructure.104 Second, the clause obligates
Georgia Power not to withhold unreasonably or deny its consent to
assignments,105 so the Cable Operators are by no means barred
from assigning their rights.106 Finally, the New Contract's
assignment clause is essentially the same as the assignment
provision of the parties' prior agreements,107 which the Cable
Operators describe as ``model[s] of reasonableness.''108
12. Termination
38. The parties' prior agreements had terms of at least
five years and were terminable on six months' notice by either
party.109 The New Contract has no fixed term and is terminable
at any time by Georgia Power on 90 days' notice, ``to the extent
not prohibited by law.''110 The Cable Operators assert that the
shorter notice provision is unjust and unreasonable, because,
given that Georgia Power now allegedly requires agreements to be
for a term of one year, parties will be negotiating a new
contract every year after nine months into their current
contract.111 Georgia Power argues that it needs flexibility in
the newly ``deregulated power industry,'' and that ``ninety days
is more than enough time to negotiate the terms of a new
agreement.''112 These justifications, in our view, are strained.
Specifically, it is unclear how deregulation of the power
industry translates into a need to terminate contracts on less
notice than in the past. Moreover, given the difficulties the
parties have had in negotiating the New Contract, we are not
sanguine that ninety days is a sufficient time frame to re-
negotiate a contract. Accordingly, we order the
parties to negotiate based on business needs and industry
practice a reasonable termination clause.
III. CONCLUSION AND ORDERING CLAUSES
39. Accordingly, IT IS ORDERED, pursuant to sections 0.111,
0.311, and 1.1401-1.1418 of the Commission's rules, 47 C.F.R. §§
0.111, 0.311, 1.1401-1.1418, that the relief requested in the
Complaint IS GRANTED TO THE EXTENT INDICATED HEREIN.
40. IT IS FURTHER ORDERED, pursuant to sections 0.111,
0.311, 1.1410, and 1.1415 of the Commission's rules, 47 C.F.R. §§
0.111, 0.311, 1.1410, 1.1415, that Georgia Power cease and desist
from enforcing the New Contract's provisions found by this Order
to be unreasonable, and that Georgia Power refund to the Cable
Operators, retroactive to the date the Complaint was filed, any
amounts paid pursuant to the unreasonable provisions.
41. IT IS FURTHER ORDERED, pursuant to sections 0.111,
0.311, 1.1410, and 1.1415 of the Commission's rules, 47 C.F.R. §§
0.111, 0.311, 1.1410, 1.1415, that Georgia Power resume
negotiations with the Cable Operators, that Georgia Power bargain
in good faith with the Cable Operators concerning the New
Contract's provisions found by this Order to be unreasonable, and
that, pending negotiations, the parties' prior pole attachment
agreements remain in effect, retroactive to the date Georgia
Power canceled the agreements, until the earlier of (a) the
execution of a mutually-acceptable pole attachment contract or
(b) one year from the date of release of this Order.
42. IT IS FURTHER ORDERED, pursuant to Sections 0.111,
0.311, 1.1410, and 1.1415 of the Commission's rules, 47 C.F.R. §§
0.111, 0.311, 1.1410, 1.1415, that in the event the parties
cannot reach an agreement one year from the date of release of
this Order, they shall file a joint report to with the Chief of
the Market Disputes Resolution Division of the Enforcement
Bureau, summarizing the status of the negotiations, including a
description of the issues that remain in dispute and the parties'
respective positions concerning those issues.
43. IT IS FURTHER ORDERED, pursuant to sections 0.111,
0.311, and 1.1401-1.1418 of the Commission's rules, 47 C.F.R. §§
0.111, 0.311, 1.1401-1.1418, that the Motion For Leave to File
Motion to Substitute Parties, File No. PA 01-002 (filed Dec. 6,
2001); Motion to Substitute Parties, File No. PA 01-002 (filed
Dec. 6, 2001); Motion for Leave to File Supplement, File No. PA
01-002 (filed Mar. 8, 2002); Motion for Leave to File Supplement,
File No. PA 01-002 (filed Mar. 27, 2002); Motion for Leave to
File Surreply and Surreply Regarding Supplement, File No. PA 01-
002 (filed Apr. 17, 2002), ARE GRANTED.
44. IT IS FURTHER ORDERED, pursuant to sections 0.111,
0.311, and 1.1401-1.1418 of the Commission's rules, 47 C.F.R. §§
0.111, 0.311, 1.1401-1.1418, that the Motion For Leave and Motion
to Strike, File No. PA 01-002 (filed Aug. 9, 2001), IS DENIED.
FEDERAL COMMUNICATIONS COMMISSION
David H. Solomon
Chief, Enforcement Bureau
_________________________
1 Effective March 25, 2002, the Commission transferred
responsibility for resolving pole attachment complaints from the
former Cable Services Bureau to the Enforcement Bureau. See
Establishment of the Media Bureau, the Wireline Competition
Bureau, and the Consumer and Governmental Affairs Bureau,
Reorganization of the International Bureau and Other
Organizational Changes, Order, 17 FCC Rcd 4672 (2002).
2 CTAG is an industry trade association acting on behalf of the
following members: Alltel Teleview, Inc.; Blackshear TV Cable,
Inc.; Charter Communications; City of Covington, Georgia; Comcast
Cable Communications, Inc.; Cox Communications, Inc.; Insight
Communications Co.; InterMedia Partners, L.P.; James Cable
Partners; MCC Georgia, LLC; MediaOne Enterprises, Inc.; MediaOne
of Colorado, Inc.; MediaOne of Greater Florida, Inc.; Northland
Cable Television, Inc.; Northland Cable Properties Seven Limited
Partnership; Northland Cable Properties Eight Limited
Partnership; Northland Premier Limited Partnership; RGW
Communications, Inc.; Southeast Cable TV, Inc.; Suburban Cable,
Inc.; US Cable of Coastal-Texas, L.P.; and Waycross Cable Co.,
Inc. Complaint, File No. PA 01-002 (filed Jan. 17, 2001)
(``Complaint''), Exhibit 1; Supplement, File No. PA 01-002 (filed
Feb. 6, 2001) (``February 6 Supplement''), Exhibit 1; Supplement,
File No. PA-01-002 (filed Sept. 5, 2001) (``September 5
Supplement''), Exhibit 1; Motion to Substitute Parties, File No.
PA 01-002 (filed Dec. 6, 2001) at 2. On March 8, 2002, the
original complainants endeavored to add Time Warner Cable and
Flint Cable TV, Inc. as complainants. Supplement, File No. PA
01-002 (filed Mar. 8, 2002) (``March 8 Supplement''). See also
Motion for Leave to File Supplement, File No. PA 01-002 (filed
Mar. 8, 2002). Georgia Power objected to the amendment (although
it did not object to two similar amendments made in the February
6 and September 5 Supplements), arguing that the March 8
Supplement unnecessarily protracts the proceeding, and that,
through the March 8 Supplement, the Cable Operators are
attempting to ``bootstrap by supplemental pleading an entirely
new issue [i.e., Georgia Power's imposition of a $53.35 rate]
that was not raised in the Complaint and as to which Georgia
Power has had no opportunity to respond.'' Opposition of Georgia
Power Company to Supplement, File No. PA 01-002 (filed Mar. 21,
2002) (``Opposition to March 8 Supplement'') at 2-3. We disagree
with Georgia Power that addition of two cable operators is
inappropriate. See Florida Cable Telecommunications Ass'n, Inc.
v. Gulf Power Co., Memorandum Opinion and Order, 18 FCC Rcd 9599,
9599, n.2 (Enf. Bur. 2003) (allowing the addition of cable
operators who are ``similarly-situated aggrieved complainants'').
However, the Cable Operators cannot, via the March 8 Supplement,
challenge Georgia Power's new annual pole attachment rate. See
RCN Telecom Servs. of Philadelphia, Inc. v. PECO Energy Co.,
Order, 16 FCC Rcd 11857, 11858, ¶ 4 (Cable Servs. Bur. 2001)
(describing appropriate means of introducing new issues in pole
attachment complaint proceedings). As discussed infra section
III.B.10., the Complaint objects to Georgia Power's alleged
refusal to negotiate over a proposed contract provision allowing
``retroactive rate adjustments.'' Complaint at 17, ¶¶ 91-95.
The pleading does not contest imposition of a $53.35 annual rate.
Complaint at 3-4 n.7 (complainants reserve their ``right . . . to
challenge this unlawful rate with the Commission''). Indeed,
the Cable Operators appear to concede this fact, and subsequently
have explained that they ``separately and informally asked
Georgia Power to clarify its intentions regarding the rate
increases and the bases therein.'' Reply to Georgia Power's
Opposition, File No. PA 01-002 (filed Apr. 2, 2002) (``Reply to
Opposition to March 8 Supplement'') at 4-5.
3 47 U.S.C. § 224(b)(1).
4 Complaint at 2, ¶ 2.
5 Complaint at 2, ¶ 5.
6 See Complaint, Exhibit 3 (prior pole attachment agreements);
February 6 Supplement, Exhibit 3 (prior pole attachment
agreements); September 5 Supplement, Exhibit 3 (prior pole
attachment agreements); March 8 Supplement (prior pole attachment
agreements). When discussing the parties' prior pole attachment
agreements, this Order, for convenience, hereafter will cite only
Exhibit 3 to the Complaint. Such citation, however, should be
understood to refer also to the several supplements that have
augmented the contents of Exhibit 3.
7 Complaint at 4, ¶ 13 & Exhibit 5 (Letter dated June 30, 2000 to
Cable Operators from J. Darryl Wilson, Joint Use Coordinator,
Georgia Power) (``June 30 Letter'').
8 Complaint, Exhibit 5 (June 30 Letter).
9 Complaint, Exhibit 5 (June 30 Letter).
10 Complaint at 5, ¶ 17; Response of Georgia Power Company, File
No. PA 01-002 (filed Feb. 16, 2001) (``Response'') at 32; Reply,
File No. PA 01-002 (filed Mar. 15, 2001) (``Reply'') at 7.
11 See Complaint, Exhibit 5 (various memoranda and correspondence
between counsel for the Cable Operators and counsel for Georgia
Power).
12 See Complaint, Exhibit 5 (various memoranda and correspondence
between counsel for the Cable Operators and counsel for Georgia
Power).
13 Complaint, Exhibit 5 (December 14, 2000 Memorandum from Paul
Glist, counsel for the Cable Operators, to David Armistead,
counsel for Georgia Power [``December 14 Memorandum'']) at 3;
Complaint, Exhibit 5 (December 22, 2000 letter to J. Darryll
Wilson, Joint Use Coordinator, Georgia Power, from Scott
Colavolpe, Contract Administration Manager, Law & Government
Affairs, AT&T Broadband [``December 22 Letter'']); Complaint,
Exhibit 5 (December 28, 2000 letter to J. Darryll Wilson, Joint
Use Coordinator, Georgia Power, from Scott Colavolpe, Contract
Administration Manager, Law & Government Affairs, AT&T Broadband
[``December 28 Letter'']).
14 Complaint, Exhibit 5 (November 1, 2000 letter to Paul Glist,
counsel for the Cable Operators, from David Armistead, counsel
for Georgia Power [``November 1 Letter'']) at 1-2.
15 Complaint, Exhibit 5 (November 1 Letter) at 1.
16 Complaint, Exhibit 5 (December 20, 2000 Letter to Paul Glist,
counsel for the Cable Operators, from David H. Armistead, counsel
for Georgia Power [``December 20 Letter'']) at 5; Complaint,
Exhibit 5 (December 29, 2000 letter to Scott Colavolpe, AT&T
Broadband, from J. Darryll Wilson, Joint Use Coordinator, Georgia
Power [``December 29 Letter'']).
17 Complaint, Exhibit 5 (December 20 Letter) at 5; Complaint,
Exhibit 5 (December 29 Letter). For simplicity, we describe the
activity that Georgia Power prohibited as new attachments,
although the utility appears to have disallowed overlashing and
certain expansion activities as well. See Reply, Exhibit 6
(February 13, 2001 e-mail to Cable Operators from J. Darryll
Wilson, Joint Use Coordinator, Georgia Power).
18 Complaint at 7-18, ¶¶ 29-99. The provisions relate to the
following subject matters: overlashing, inspection rights,
administrative fees, make-ready work, unauthorized attachment
fees, drop poles, rights-of-way and easements, security
interests, indemnities/limits of liability, worker releases,
force majeure, rates, assignments, and termination.
19 Complaint at 4-6, ¶¶ 13-22.
20 Complaint at 19, ¶ 105.
21 Response at 4-6.
22 Response at 6-32.
23 Reply, Summary. Approximately five months after the Cable
Operators filed their Reply, Georgia Power moved to Strike the
portions of the Reply in which the Cable Operators allegedly
``mis-characteriz[e] the electric utility industry as anti-
competitive and the cable television industry as pro-
competitive.'' Motion for Leave and Motion to Strike, File No.
PA 01-002 (filed Aug. 9, 2001) (``Motion to Strike'') at 3.
According to Georgia Power, the Reply ``repeatedly makes
impertinent, immaterial, and inflammatory `factual' allegations
without support.'' Motion to Strike at 3. We agree with Georgia
Power that certain portions of the Reply (e.g., pages 42-55) are
largely irrelevant to resolving this dispute and, indeed, merely
add unnecessary histrionics. We are not relying on those
portions of the Reply in reaching our conclusions herein.
Nevertheless, we deny the Motion to Strike, because it was not
timely filed. Georgia Power's assertion that it waited five
months in order to see whether the Cable Services Bureau would
strike the Reply sua sponte (Reply in Support of Motions for
Leave and to Strike, File No. PA 01-002 (filed Aug. 31, 2001) at
2) strains credulity, given the multitude of filings in this
proceeding beyond those countenanced by the Commission's rules.
24 47 C.F.R. §§ 1.1404, 1.1409(b).
25 Response at 4-5.
26 Complaint at 4-6, ¶¶ 13-21; at 6-7, ¶¶ 24-26; at 7, ¶¶ 30-31;
at 8, ¶¶ 33-34; at 9, ¶¶ 37, 40; at 9-10, ¶¶ 42-44; at 11, ¶¶ 49,
51-52, 54; at 12, ¶¶ 56, 59-61; at 13, ¶¶ 63, 65, 67-68; at 14,
¶¶ 70-73; at 15, ¶¶ 75-78; at 16, ¶¶ 80, 83, 85-86, 88-89; at 17,
¶¶ 91, 94, 96-97; at 18, ¶¶ 99-100.
27 Complaint, Exhibit 3 (pole attachment agreements).
28 Complaint, Exhibit 6 (New Contract).
29 Complaint, Exhibit 5 (various memoranda and correspondence
between counsel for the Cable Operators and counsel for Georgia
Power).
30 Complaint, Exhibit 7 (Declaration of Nancy Horne [``Horne
Declaration'']), Exhibit 8 (Declaration of Harris L. Bagley
[``Bagley Declaration'']). These declarations are based on
``knowledge, information and belief.'' Section 1.1405(l) of the
Commission's rules requires affiants to have ``actual knowledge
of the facts.'' 47 C.F.R. § 1.1404(l). Nevertheless, given that
the declarants attest that they directly were involved in the
events narrated in the Complaint, and given that Georgia Power
has provided a detailed response to all of the Complaint's
allegations, we find that Georgia Power has not been prejudiced
by any alleged deficiencies in the declarations.
31 Response at 5-6.
32 47 U.S.C. § 224(b)(1).
33 Complaint at 6-7, ¶¶ 21-27; Complaint, Exhibit 5 (December 20
Letter) at 5; Complaint, Exhibit 5 (December 29 Letter); Reply at
15-16; Reply, Exhibit 5 (Declaration of Scott S. Colavolpe
[``Colavolpe Declaration'']) at 3-4, ¶¶ 11-13; Reply,
Exhibit 7 (Reply Declaration of Mark W. Fowler [``Fowler Reply
Declaration'']) at 2, ¶ 5; Reply, Exhibit 15 (Declaration of
Timothy M. Gregory [``Gregory Declaration'']) at 2, ¶ 5, at 4, ¶
11.
34 See Texas Cable & Telecommunications Ass'n v. Entergy
Services, Inc., Order, 14 FCC Rcd 9138, 9142, ¶ 12 (Cable Servs.
Bur. 1999) (``TCTA v. Entergy'') (finding a dispute concerning a
proposed pole attachment agreement to be ripe where the parties
reached an impasse in their negotiations); Omnipoint Corp. v.
PECO Energy Co., Memorandum Opinion and Order, 18 FCC Rcd 5484,
5485, ¶ 4 (Enf. Bur. 2003) (``A complaint alleging denial of
access, in this case due to an allegedly excessive attachment
rate, is valid and ripe for review under the Pole Attachment Act
and the Commission's rules.'').
35 The Complaint challenges the reasonableness of a number of
terms and conditions and, concomitantly, claims that Georgia
Power failed to negotiate in good faith. Because we address the
reasonableness of each of the challenged provisions below, we
need not address separately whether the provision was negotiated
in good faith. Rather, where we determine that the term is
unreasonable, we order Georgia Power to negotiate in good faith
with the Cable Operators to reach agreement as to a reasonable
provision.
36 In this regard, the Cable Operators challenge provisions of
the New Contract pertaining to notice of pole replacements
(Complaint at 11, ¶ 51) and the treatment of drop poles
(Complaint at 12-13, ¶¶ 58-64). Georgia Power argues that
neither of these subjects was raised in the parties' pre-
Complaint negotiations (Response at 18, 20, 22), and the Cable
Operators do not refute this assertion in their Reply. In
addition, the Cable Operators contend generally (i.e., without
identifying a particular provision of the New Contract or
explaining relevant factual context) that the New Contract
``allows Georgia Power to refuse responsibility for its own
subsequent make-ready costs.'' Complaint at 11, ¶ 49. It
similarly appears that the parties did not address this issue in
their pre-Complaint negotiations. The Commission's pole
attachment complaint rules apply ``when parties are unable to
arrive at a negotiated agreement . . . .'' In the Matter of
Amendment of Commission's Rules and Policies Governing Pole
Attachments, Consolidated Partial Order on Reconsideration, 16
FCC Rcd 12103, 12111, ¶ 10 (``Pole Attachments Reconsideration
Order''). We order the parties to negotiate in good faith
concerning these issues, in addition to the other issues
identified in this Order.
37 Georgia Power argues that the Cable Operators have an
``abysmal record'' of ``blatant . . . [and] rampant'' safety
violations (Response at 7, 8); that, over a period of years, the
Cable Operators have committed in Georgia 15,684 recorded
violations of the National Electric Safety Code (``NESC'') and
accepted industry construction standards (Response at 7); that,
over a three-year period, fifteen percent of all construction
locations inspected on behalf of Georgia Power had to be shut
down because of severe safety violations; and that, according to
the Georgia Public Service Commission, Georgia cable television
companies in general have hit gas pipelines over 1,400 times,
because they violated the ``24 inch tolerance zone required by
law'' (Response at 8).
38 Response at 3.
39 Response at 3.
40 Response at 3-4, 12, 15, 17, 27. While average, typical, or
standard conduct can be evidence of what is just and reasonable,
it is not conclusive. See, e.g., Local Competitive Provisions in
the Telecommunications Act of 1996, First Report and Order, 11
FCC Rcd 15499, 16072, ¶ 1151 (1996) (``Local Competition Order'')
(``industry codes also will be presumed reasonable if shown to be
widely-accepted objective guides for the installation and
maintenance of electrical and communications facilities'')
(subsequent history omitted). Because attachers may have varying
abilities to mount a legal challenge to the New Contract, we do
not view a willingness to sign the New Contract, standing alone,
as evidence of the reasonableness of its terms.
41 Reply, Summary at 1; Reply, Exhibit 1 (Reply Declaration of
Nancy Horne [``Horne Reply Declaration'']) at 6, ¶ 17 (``Georgia
Power did not raise safety issues as a concern while discussing
unauthorized attachments, or other provisions for that matter.
Georgia Power also never discussed safety violations by CTAG
members as a reason for imposing significantly more burdensome
and objectionable terms in the new agreement.''); Reply, Exhibit
2 Bagley Declaration at 3, ¶ 7 (``Georgia Power has never
informed me or my staff of Comcast safety violations''); Reply,
Exhibit 15 (Declaration of Timothy M. Gregory [``Gregory
Declaration'']) at 4, ¶ 12 (``During the more than three years
that I have served as [Comcast's safety point of contact for five
counties], I have received no reports of safety code violations
from Georgia Power, with the exception of minor incidents arising
from natural phenomena such as severe storms, strong winds or
accidents. In those limited instances, Comcast acted promptly to
correct the problem.''). But cf. Reply, Exhibit 5 (Colavolpe
Declaration) at 2, ¶ 8 (``Safety and network reliability were
discussed [at the October 12, 2000 meeting between the parties]
but were not the specific overriding themes of the session.'').
42 See 47 U.S.C. § 224(f)(2) (a utility may deny access ``for
reasons of safety'').
43 See Reply at 18-20. Specifically, a spreadsheet submitted by
Georgia Power purportedly documenting recent safety violations
contains no dates (see Response, Exhibit B (Declaration of David
Thompson [``Thompson Declaration'']), Exhibit 4 (Shutdowns of
Companies as a Result of Violations)), and a summary of
violations purportedly committed in large part by AT&T/MediaOne
contains dated information that calls into question the report's
accuracy (see Response, Exhibit B (Thompson Declaration), Exhibit
6 (FCC Complaint Post Inspection Report)). Moreover, we cannot
tell from the latter exhibit which attaching entity is
responsible for the alleged violations. Compare Response,
Exhibit B (Thompson Declaration) at 2 ¶ 16 (``Exhibit 6 portrays
the number of poles with violations committed by cable companies
in specific nodes within a particular hub.''), with Reply at 19 &
Exhibit 8 (Declaration of James J. Yates [``Yates Declaration''])
at 5, ¶ 15 (``Georgia Power's attitude has always been that if
there is a violation on a pole to which AT&T Broadband is
attached, then AT&T Broadband is responsible for the violation .
. . According to USS, AT&T Broadband is responsible for taking
only 643 of the actions necessary to clear violations on poles
located in Hub C1. Georgia Power and the telephone company are
responsible for the other 867 actions needed.'').
44 Response at 8 n.24; Response, Exhibit B (Thompson Declaration)
at 4, ¶ 17.
45 Response, Exhibit K (Declaration of Michael E. Davis [``Davis
Declaration'']) at 6, ¶ 23.
46 The Cable Operators appear to acknowledge that their
attachments sometimes caused unsafe conditions, but they urge
that such problems always have been solved in the normal course
of business under the parties' prior agreements. Reply at 21-23;
Reply, Exhibit 3 (Declaration of William B. Durand [``Durand
Declaration'']) at 5, ¶ 13; Reply, Exhibit 8 (Declaration of
James J. Yates [``Yates Declaration'']) at 1-2, ¶ 4.
47 Pole Attachments Reconsideration Order, 16 FCC Rcd at 12140, ¶
73. See also Implementation of Section 703(E) of the
Telecommunications Act of 1996, Amendment of the Commission's
Rules and Policies Governing Pole Attachments, Report and Order,
13 FCC Rcd 6777, 6807, ¶ 62 (1998) (``Telecom Order'') (``We
believe overlashing is important to implementing the 1996 Act as
it facilitates and expedites installing infrastructure essential
to providing cable and telecommunications services to American
communities. Overlashing promotes competition by accommodating
additional telecommunications providers and minimizes installing
and financing infrastructure facilities. We think that
overlashing is an important element in promoting the policies of
Sections 224 and 257 to provide diversity of services over
existing facilities, fostering the availability of
telecommunications services to communities, and increasing
opportunities for competition in the marketplace.'') (footnotes
omitted).
48 Complaint, Exhibit 3 (prior pole attachment agreements), § 6;
Reply, Exhibit 1 (Horne Reply Declaration) at 4, ¶ 10.
49 Complaint, Exhibit 6 (New Contract), §1.1.
50 Pole Attachments Reconsideration Order, 16 FCC Rcd at 12141, ¶
75.
51 Complaint, Exhibit 3 (prior pole attachment agreements), § 8;
Reply at 33.
52 Complaint, Exhibit 6 (New Contract), § 5.
53 Complaint, Exhibit 6 (New Contract), § 5.
54 Complaint at 9, ¶ 36. See also Reply at 33-34.
55 Response at 12.
56 Complaint, Exhibit 6 (New Contract), § 5 (emphasis added).
57 See Response at 12, 13.
58 Response, Exhibit K (Davis Declaration) at 4, ¶ 12.
59 See Amendment of Rules and Policies Governing the Attachment
of Cable Television Hardware to Utility Poles, Report and Order,
2 FCC Rcd 4387, 4393 ¶ 41 (1987) (a ``separate charge or fee for
items such as application processing or periodic inspections of
the pole plant is not justified if the costs associated with
these items are already included in the rate, based on fully
allocated costs, which the utility charges the cable company
since the statute does not permit utilities to recover in excess
of fully allocated costs''). There is no suggestion in the
record that costs of routine inspections are not included as part
of Georgia Power's annual pole attachment rate calculated in
accordance with the Commission's formula.
60 Complaint, Exhibit 6 (New Contract), § 16.6.
61 Complaint, Exhibit 6 (New Contract), §16.6.
62 Complaint at 9-10, ¶¶ 42, 45. See also Reply at 34.
63 When calculating the administrative portion of the carrying
charges, the Commission allocates the total plant administrative
expenses to yield a reasonable estimate of the administrative
expenses related to poles. Nevada State Cable Television Ass'n
v. Nevada Bell, Order on Reconsideration, 17 FCC Rcd 15534,
15539, ¶ 13 (Enf. Bur. 2002).
64 See 18 C.F.R. pt. 101, Accounts 920, et seq.
65 See, e.g., TCTA v. Entergy, 14 FCC Rcd at 9143, ¶ 14.
66 Complaint at 10, ¶ 44; Response at 15-16.
67 Response at 15.
68 Complaint at 6-7, ¶¶ 23-26, at 10, ¶ 46; Complaint, Exhibit 8
(Bagley Declaration) at 2, ¶ 8.
69 Implementation of the Local Competition Provisions in the
Telecommunications Act of 1996, CC Docket No. 96-98,
Interconnection Between Local Exchange Carriers and Commercial
Mobile Radio Service Providers, CC Docket No. 95-185, Order on
Reconsideration, 14 FCC Rcd 18049, 18086, ¶ 107 (1999) (emphasis
added).
70 Complaint, Exhibit 6 (New Contract), § 4.2.
71 Complaint at 12, ¶ 54-55. See also Reply at 36-37.
72 Response at 18 & Exhibit F (Declaration of Obie Youngblood
[``Youngblood Declaration'']) at 2, ¶ 9; Exhibit G (Declaration
of Ron Marshall [``Marshall Declaration'']) at 2, ¶ 5; Exhibit K
Davis Declaration at 4-5, ¶¶ 16-18. Neither the Response nor the
declarations accuse the Cable Operators specifically of making
unauthorized attachments.
73 Response at 18.
74 Response at 18.
75 Mile Hi Cable Partners, L.P. v. Public Service Co. of Colo.,
Order, 15 FCC Rcd 11450, 11457, ¶ 10 (Cable Servs. Bur. 2000)
(``Mile Hi Bureau Order''), review denied, 17 FCC Rcd 6268 (2002)
(``Mile Hi Commission Order''), review denied sub nom. Public
Serv. Co. of Colo. v. FCC, 328 F.3d 675 (D.C. Cir. 2003).
76 Mile Hi Bureau Order, 15 FCC Rcd at 11457, ¶ 10.
77 Response at 19. See Mile Hi Commission Order, 17 FCC Rcd at
6272, ¶ 10 (general contract principles prohibit the enforcement
of unreasonable penalties for breach of contract). As discussed
supra, section III.B.1., we reject Georgia Power's assertion that
the Cable Operators have committed recent, widespread safety
violations.
78 Complaint, Exhibit 6 (New Contract), § 6.
79 47 U.S.C. § 541.
80 Complaint at 13, ¶ 66.
81 Reply at 38.
82 47 U.S.C. § 224(f)(1) (emphasis added).
83 Response at 22 (citing Media General, 991 F.2d at 1175; Cable
Holdings, 953 F.2d at 602).
84 See FCC v. Florida Power Corp., 480 U.S. 245, 254 (1987)
(finding that it could not be seriously argued that a rate
providing for the fully allocated recovery of costs is
confiscatory); Alabama Power Co. v. FCC, 311 F.3d 1357, 1360
(11th Cir. 2002) (``before a power company can seek compensation
above marginal cost, it must show with regard to each pole that
(1) the pole is at full capacity and (2) either (a) another buyer
of the space is waiting in the wings or (b) the power company is
able to put the space to a higher-valued use with its own
operations. Without such proof, any implementation of the Cable
Rate (which provides for much more than marginal cost)
necessarily provides just compensation.'').
85 Pole Attachments Reconsideration Order, 16 FCC Rcd at 12162, ¶
123 (``utility enjoys full use of its land rights, and an
attacher's physical occupation of a portion of space on a pole
does not restrict the utility's use of land for its distribution
network'').
86 Complaint at 14, ¶¶ 70-74 & Exhibit 6 (New Contract), §§ 9.1,
9.2, 9.3; Reply at 39-40.
87 See Complaint, Exhibit 3 (prior pole attachment agreements) at
17, ¶ 30.
88 Complaint at 15, ¶¶ 75-79 & Exhibit 6 (New Contract), §§ 8.1,
8.2, 8.4; Reply at 41.
89 Response at 24-25.
90 See section III.C.1., supra.
91 Response at 24.
92 The Cable Operators also challenge a related provision of the
New Contract requiring workers to sign a release in Georgia
Power's favor. Complaint at 16, ¶¶ 80-84 & Exhibit 6 (New
Contract), § 2.4; Reply at 42. The provision is substantially
similar to provisions contained in the parties' prior pole
attachment agreements, which the Cable Operators describe as
``model[s] of reasonableness.'' Reply at 28. The provision,
however, should be clarified to provide that a such a release
would not apply when Georgia Power is grossly negligent or
commits willful misconduct.
93 Complaint at 16, ¶¶ 88-89 & Exhibit 6 (New Contract), § 15;
Reply at 43.
94 Reply at 43.
95 Response at 28.
96 Response at 28.
97 Black's Law Dictionary 254 (Pocket Edition 1996).
98 Complaint at 17, ¶¶ 91-95 & Exhibit 6 (New Contract), § 7.1.
99 Response at 29.
100 Complaint at 17, ¶ 92.
101 Response at 29.
102 47 C.F.R. § 1.1403(C)(2).
103 Complaint at 17, ¶ 96; Reply at 45. See Complaint, Exhibit 6
(New Contract), § 16.1.
104 Response at 30.
105 Complaint, Exhibit 6 (New Contract), § 16.1.
106 In considering requests for assignment in connection with
affiliate transfers and transfers to incumbent attachers, we
fully expect Georgia Power, absent extraordinary circumstances,
to grant its consent expeditiously.
107 See Complaint, Exhibit 3 (prior pole attachment agreements),
§ 27.
108 Reply at 28.
109 Complaint, Exhibit 3 (prior pole attachment agreements), §
29.
110 Complaint, Exhibit 6 (New Contract), § 10.
111 Complaint at 18, ¶ 101; Reply at 46.
112 Response at 31. Georgia Power also argues that it negotiated
in good faith about this position, because it amended the
termination clause as it originally appeared in the New Contract
to state that it may exercise termination rights only to the
extent not prohibited by law. Response at 31. See Complaint,
Exhibit 5 (November 1 Letter) at 2. It is hardly a negotiation
concession, however, for a party to clarify in a contract that it
will obey the law.