Settlement Possible in Local Lawsuit Against Texas Small-Cells Law
Talks with the telecom industry could resolve a McAllen, Texas, lawsuit challenging the state’s small-cells law, local officials told us this week. Texas is defending the 2017 law pre-empting local governments in the right of way (ROW) from a state court challenge by McAllen and a federal court challenge by Austin (see 1710040044). A Michigan bill awaiting gubernatorial clearance could be the next state small-cells law to be challenged in court by localities, said Kitch local government attorney Mike Watza.
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With discovery nearly finished in McAllen’s lawsuit at the Texas District Court of Travis County, the city is “still attempting to work with the wireless infrastructure providers and telecommunications companies to reach an amicable solution,” Assistant City Attorney Austin Stevenson said. “If an agreement is reached, a trial would no longer be necessary.” Stevenson declined to give more details of talks he said are “highly confidential.” Texas, AT&T and Crown Castle declined comment.
“They are looking to negotiate some type of settlement,” emailed Texas Municipal League General Counsel Scott Houston. “We haven’t put anything specific on the table, but it would need to be something that garnered a rental payment that gets closer to the actual fair market value of the city rights-of-way/facility placement.” One possible outcome would be an agreement to throw out the current law for constitutional reasons, with consensus on how to move forward, he said: “If cities and industry wanted to come up with a new, state-mandated fee structure, that would require legislation.”
Austin’s separate challenge to the Texas law in U.S. District Court in that city could see movement soon. The court last month referred (in Pacer) the state’s motions to dismiss to U.S. Magistrate Andrew Austin. He was counsel to AT&T with the since-dissolved firm Sheinfeld Maley in two lawsuits, decided in 1998 and 1999 -- prior to the SBC/AT&T merger, by the carrier against Dallas related to municipal franchises for access to ROW.
Michigan passed a small-cells bill last week that needs signature from outgoing Republican Gov. Rick Snyder (see 1811290035). While the Michigan Municipal League is neutral on the measure, some communities remain opposed. “There’s strong support to continue fighting,” even if the bill is signed into law, said Watza, representing Protec, a group of Michigan municipalities and utilities.
Michigan localities could cite the state’s home rule in a possible legal challenge to the small-cells law, if signed, Watza said. “We have an exceptionally powerful home-rule Constitution here that tells the state point blank these rights of way are ours. You cannot diminish our authority.” Recent elections may affect enforcement of the law next year because Democrats flipped governor and attorney general seats, the attorney said. Incoming Gov. Gretchen Whitmer (D) will appoint utility commissioners who may have to interpret the law, while the next AG Dana Nessel (D) would have to defend any suits.
Protec usually agrees with the Michigan Municipal League, but MML made its own agreement with carriers and ended up declaring itself neutral on the state bill, Watza said. Protec continued grassroots work opposing the bill and peeled off 35 votes from both parties, he said. “We just couldn’t get everywhere we needed to be on our own to fight this bill successfully.” MML didn’t comment.
Watza predicted industry will “pick and choose” parts it likes from the state bill and the FCC September order, taking lower application fees in the order and “deemed granted” and lower annual rates from the Michigan measure. That’s how industry behaved when there was overlap between FCC rulings on the federal Cable Act and state video service bills from 2006, he said. Cities also are suing over the FCC order (see 1812030037).
The Wireless Infrastructure Association praises the bill as a big step to bringing 5G there. WIA and CTIA didn't comment Tuesday. Watza said nothing enforceable in the bill can require industry to bring broadband to rural areas that need it most: “Rural Michigan isn’t going to see 5G in our lifetime, and this bill does nothing to improve that.”