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March 16, 2011

Re: Oppose S-2664 “Market Competition Consumer Choice Act” As a Loss for Local Communities

Dear Mayor,

S-2664 is expected to come to a floor vote in the Senate Monday.  Please contact your state Senator and express your concerns with this legislation.  Even if you have contacted them earlier, it is important for them to hear from you now as this issue comes to a vote Monday.  See detailed analysis in our March 11 letter

Piscataway Mayor Brian Wahler, Chair of the League’s Telecommunications Committee issued the following statement on S-2664, the Market Competition Consumer Choice Act.”

“The League hopes that the proponents of changing the systemwide cable franchise law will see that municipalities have always been, and remain, primary partners in New Jersey’s cable franchises.  Any inquiry into changing such franchises must include honest conversations with New Jersey’s municipalities about communities’ cable related needs.

Today the League of Municipalities continues to oppose S-2664 the Market Competition Consumer Choice Act because it will result in the loss of important benefits and service to which communities are currently entitled.  “

Why the League opposes S-2664

  1. The bill reduces the current obligation of a systemwide cable franchise to provide cable and internet connections to municipal and school buildings at no charge to a municipality. This is an attempt to avoid legitimate responsibilities associated with a community’s cable related needs, while creating increased costs for municipalities.
  2. The bill does not require the cable companies to provide a return feed to allow cable-casting of live municipal events. Municipalities seek to preserve live cablecasting of local emergencies and events, a legitimate community cable related need.
  3. The bill does not require systemwide franchises to meet or surpass any existing line extension policy or to meet any applicable consumer protection requirements, all of which are required by the current law.  The line extension requirement in current law is important to sparsely populated communities and must be retained so all citizens will be served regardless of where their home is located now or in the future.
  4. The bill has an inadequate process for determining whether a company is operating in a “competitive franchise area”.  Establishing whether competition exists determines obligations under all types of cable franchises.  There must be authority to verify assertions of competition and appeal such assertions to a competent neutral body. 
  5. The process set forth in the bill for renewal of a systemwide franchise does not require that the renewal be under the same terms and conditions as the original franchise.  Renewals and initial applications must be reviewed based on the same terms and conditions to assure consistent services are provided to communities.
  6. When a company converts from a municipal consent-based franchise to a system-wide franchise they are not automatically required to pay the 4% franchise fee.  A company could unilaterally convert to a systemwide franchise fee and gain related advantages while not being subject to the higher franchise fee.
  7. Under the bill, the right of a municipality operating under a municipal-consent based franchise to petition the BPU for a higher franchise fee is eliminated.  With the speed of innovation, municipalities must have recourse to recoup franchise costs that exceed franchise fees.  Such costs, if they occur, can not be shifted to property taxes.

If you have questions contact Assistant Executive Director Michael Darcy at MDarcy@njslom.com or 609-695-3481 ext. 116.

Very truly yours,

 

William G. Dressel, Jr.
Executive Director

 

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