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Legislature Passes Flawed Cable Bill
The state Legislature today (Tues., Dec. 12, 2006) passed House Bill 6456, creating a statewide cable
franchise system which, according to the Michigan Townships Association (MTA), could have serious impacts on municipalities
and consumers in Michigan. The bill passed despite efforts by local governments and others to amend it.
David Bertram,
MTA legislative liaison, said the bill is flawed in many ways. “The legislation passed today is wrong for Michigan communities
and for cable customers,” he said. “First, consumer protection is out the window. Instead of cable subscribers
being able to go to their township board or village or city council for cable problems, they now will have to take their complaints
to the Public Service Commission.” The lack of local accountability will likely make it much more difficult for consumers
to have their issues resolved, he added.
Furthermore, the legislation allows current cable companies to break current
municipal franchising contracts for no reason, even when not faced with competition in the community. In fact, it's this provision
which makes Michigan's cable legislation different than similar agreements in other states. The bill also greatly hinders
the ability of local governments to manage and maintain their rights-of-way, and could substantially reduce revenues to a
number of communities.
The biggest losers, however, will be subscribers in rural or low-density areas. Cable companies
will no longer be bound by build-out language designed to ensure that rural residents receive the same services enjoyed by
their urban counterparts. “Under this legislation, current subscribers in these areas stand to lose service guarantees
and will most certainly not see upgraded services in the months and years ahead,” Bertram noted. “Upgrades and
new investment will be made in those few communities or parts of communities with high populations that can afford the bundled
offerings of phone, cable and Internet services.”
MTA has been joined in opposing the legislation by the Michigan
Municipal League, as well as Internet companies such as Google, Yahoo! and eBay.
Senate & House Pass Cable
Franchise Bill
from the Michigan Municipal League web site: www.mml.org
Today, the Michigan Senate passed HB 6456 by a 26-12 vote and the Michigan House concurred with the bill. The bill now
goes to Gov. Granholm for her potential approval. Although MML offered numerous amendments, none were adopted.
The MML remained strongly opposed to this bill due to the negative impact it will have on local communities.
MML thanks Sens. Cassis, Birkholz, Jacobs, Hardiman and George for their amendments supporting municipal issues. We also
thank the hundreds of local elected officials who asked their state senator to vote against this legislation.
MML also appreciates Sens. Basham, Olshove, Clarke, Jelinek, Prusi, Brater, George, Scott, Clark-Coleman, Patterson, Van
Woerkom and Jacobs for voting against this legislation which could harm local communities in a variety of ways.
The Senate did include a provision to increase PEG channel support from 1 percent to 2 percent. For some communities this
may be an increase in overall PEG revenue if their contracts are abrogated. As the bill passed, it still will impact communities
in the following way:
HB 6456 Will Allow:
- The ability of cable companies to terminate local franchise contracts at their discretion
- An annual $47-57 million revenue reduction to local communities due to loss of in-kind services
- Cherry-picking in local neighborhoods because there is no meaningful build-out requirement
- Potential loss of right-of-way controls
- Significantly reduced consumer, local resident, protections
Look for additional information on this issue in the Legislative Link.
Here is How Your Senator Voted:
Roll Call No. 837 Yeas (26)
Allen Cropsey Johnson Sikkema
Barcia Emerson Kuipers Stamas
Birkholz
Garcia Leland Switalski
Bishop Gilbert McManus Thomas
Brown Goschka Sanborn Toy
Cassis Hammerstrom Schauer Whitmer
Cherry
Hardiman
Nays (12)
Basham Clarke Jelinek Prusi
Brater George Olshove Scott
Clark-Coleman Jacobs Patterson
Van Woerkom
The following legislators supported 2006 House Bill 6456 (Replace local cable TV franchising with state
system):
The following legislators opposed 2006 House Bill 6456 (Replace local cable TV franchising with state
system):
The following legislators did not vote on 2006 House Bill 6456 (Replace local cable TV franchising with
state system):
Statement by Sen. Basham (from the Senate Journal on the day of final voting on HB6456):
Senator Basham's statement is as follows:
Let me just tell you why I will not be supporting this piece of legislation.
First of all, I regularly attend a couple of groups in Wayne County, outside the city of Detroit, called the Conference of
Western Wayne and the Downriver Community Conference. Those two groups alone represent every city and township outside the
city of Detroit in Wayne County. You're talking about a 1.25 million people who consistently--those groups oppose this legislation.
They thought their representatives through the Michigan Municipal League
thought--the legislation could be made better with some amendments. I watched those amendments. Some of them were withdrawn
and some of those amendments were voted "no" on, so they didn't pass. I watched my colleagues talk about competition, and
I listened as the city of Dearborn was talking about competition allowing AT&T to compete in the same environment in the
city of Dearborn where they currently have Comcast. They wouldn't agree to the same terms.
I watched and listened to all of the arguments for several months.
I even received bologna in my office from one company talking about the other company was full of bologna. I've even received
flip-flops in my office. One company said the other company was a flip-flopper.
One thing that this legislation has done thus far is it has created
jobs. Every multi-client lobbyist in the state of Michigan is working on one side or the other on this piece of legislation.
So, certainly, jobs have been created thus far. If we don't pass the bill and we deal with it next term, I would expect it
would create more jobs. These are good-paying jobs. These are not like the jobs that I've seen that are subcontractors of
either Comcast or AT&T that have to pay their own health care and buy their own equipment.
Again, there's many, many reasons to either support or oppose this
legislation, but essentially, if I could sum it up, you dance with the ones who brung ya, and certainly, my locals are opposed
to this legislation.
Senator Michael Switalski's statement is as follows:
I rise in support of House Bill No.6456. Passage of the bill in front
of us today will result in substantial investment during a time of economic stagnation. It will result in a modernization
of our infrastructure during a time of rapid technological change. It will result in the employment of thousands of people
during tough economic times and high unemployment. It will reduce regulations and create a market environment with competition
and the promise of lower rates and better service for our constituents.
But this comes at a price. By imposing a statewide contract, we are
taking away the right for our local governments to negotiate what are often lucrative agreements. So that is a choice. I respect
those who are philosophically committed to local regulation and control of this matter, but at this critical time, I think
the state needs to clear the way for investment, employment, modernization, and competition.
I don't wish to harm the locals at a time when their revenues are severely
constrained. This Senate has taken a House bill that passed that chamber 80- 21 and has doubled the Peg fees that support
local governments. This isn't a perfect bill, but it's a better bill than what passed the House. It is a significant incentive
to economic expansion in Michigan.
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