No. 27348: R746-345. Pole Attachments of Public Utility Companies

DAR File No.: 27348
Filed: 10/12/2004, 10:00
Received by: NL

RULE ANALYSIS

Purpose of the rule or reason for the change:

This change in proposed rule incorporates comments and suggestions made by commentors in the initial comment period.

 

Summary of the rule or change:

This change clarifies definitions; clarifies that the rental charge applies for each attachment, not per pole; and clarifies when net or gross cost is to be used in calculating charges. (DAR NOTE: This change in proposed rule has been filed to make additional changes to a proposed repeal and reenactment that was published in the September 1, 2004, issue of the Utah State Bulletin, on page 29. Underlining in the rule below indicates text that has been added since the publication of the proposed rule mentioned above; strike-out indicates text that has been deleted. You must view the change in proposed rule and the proposed repeal and reenactment together to understand all of the changes that will be enforceable should the agency make this rule effective.)

 

State statutory or constitutional authorization for this rule:

Sections 54-3-1, 54-4-1, and 54-4-13; and 47 U.S.C. 224(c)

 

Anticipated cost or savings to:

the state budget:

None--State agency activity in relation to pole attachment activities will stay the same.

 

local governments:

None--Local government activities are not affected by this rule.

 

other persons:

Undeterminable--To the extent that rates set in the rule are lower than those previously charged, revenue reductions will occur for those entities which previously charged the higher rate; this will be offset by a reduction in costs or expenses of those entities who previously paid the higher rate. A concomitant change will occur in situations where the rule sets a rate higher than that previously charged. These changes in revenues and expenses may be considered by the Commission when establishing other rates for the public utilities subject to the Commission's jurisdiction. The magnitude of the changes will also be subject to the number of attachments which are affected and in existence. There is significant dispute between pole attachment parties on the number of pole attachments which they have among themselves. Inventory is still occurring and disputes are still pending before the Commission.

 

Compliance costs for affected persons:

As noted under Other persons above, offsetting increases and decreases will occur. Some entities will see a reduction in revenues they receive from attaching entities, but will also see a reduction in their own expenses for the attachment costs they incur for their own attachments with other pole owning entities. To the extent permitted by law, the Commission intends to consider the net effect of such changes when establishing rates for utilities operating within the Commission's jurisdiction.

 

Comments by the department head on the fiscal impact the rule may have on businesses:

Through state and federal law, the Commission regulates the terms by which attachments are made to the poles of utilities operating in Utah. Changes in the utility industry, increasing reliance upon and access demands for use of available attachment space, and the increasing magnitude of disputes concerning the entire attachment process have prompted the Commission to reexamine, with industry participation, a wide spectrum of issues relating to pole attachments. As is often the case for the Commission, promulgation of the rule requires balancing interests of various parties. The Commission has crafted a rule which it believes is consistent with both state and federal law and sets terms which are conducive to the public interest and well being of the State of Utah and its citizens generally. Where permitted by law, the Commission will consider the specific fiscal impact, whether up or down, the rule will have on the operations of an individual public utility operating in Utah and subject to the Commission's ratemaking authority.

 

The full text of this rule may be inspected, during regular business hours, at the Division of Administrative Rules, or at:

Public Service Commission
Administration
HEBER M WELLS BLDG
160 E 300 S
SALT LAKE CITY UT 84111-2316

 

Direct questions regarding this rule to:

Sandy Mooy at the above address, by phone at 801-530-6708, by FAX at 801-530-6796, or by Internet E-mail at [e-mail]

 

Interested persons may present their views on this rule by submitting written comments to the address above no later than 5:00 p.m. on:

12/01/2004

 

This rule may become effective on:

12/02/2004

 

Authorized by:

Sandy Mooy, Legal Counsel

 

 

RULE TEXT

R746. Public Service Commission, Administration.

R746-345. Pole Attachments of Public Utility Companies.

R746-345-1. Authorization.

A. Authorization of Rules -- Consistent with the Pole Attachment Act, 47 U.S.C. 224(c), and Utah Code Annotated 54-3-1, 54-4-1, 54-4-4 and 54-4-13, the Public Service Commission shall have the power to regulate the rates, terms, and conditions by which a public utility, as defined in Utah Code Annotated 54-2-1(15)(a) including telephone corporations as defined in 54-2-23(a), can permit attachments to its poles by any other public utility, wireless provider, cable television company, or other attaching entity.

B. Application of Rules -- These rules shall apply to each public utility that permits attachments to its poles by any other public utility, wireless provider, cable television company or other attaching entity.

1. Although specifically excluded from regulation by the Commission in Utah Code Annotated 54-2-1(23)(b), solely for the purpose of any pole attachment, these rules apply to any wireless provider.

2. Pursuant to these rules, a public utility must allow any attaching entity nondiscriminatory access to utility poles at rates, terms and conditions that are just and reasonable.

C. Application of Rate Methodology -- The rate methodology described in Section R746-345-5 shall be used to determine rates that a public utility may charge any other public utility, wireless provider, cable television company, or other attaching entity to attach to its poles for compensation.

 

R746-345-2. General Definitions.

A. "Attaching Entity" -- A public utility, wireless provider, cable television company or other entity that attaches to a pole owned or controlled by a public utility.

B. "Distribution Pole" -- A utility pole, excluding towers, used by a pole owner to support mainly overhead distribution wires or cables.

C. "Pole Attachment" -- The bolt, bracket, hook, or other device used[attachment by an attaching entity of equipment that requires a bolt, bracket, hook, or other device] to secure an attaching entity's[that] equipment to a utility pole of a public utility. A new or existing service wire drop pole attachment that is attached to the same pole as an existing attachment of the attaching entity is considered a component of the existing attachment for purposes of this rule.

D. "Pole Owner"-- A public utility having ownership or control of poles used, in whole or in part, for any electric or telecommunications services.

E. "Secondary Pole" -- A pole used solely to provide service wire drops (the aerial wires or cables connecting to a customer premise).["Primary Pole Attachment" -- A pole attachment of any distribution wire or cable.]

F. "Secondary Pole Attachment" -- A pole attachment to a secondary pole[of any distribution wire or cable used solely to provide a service wire drop, an aerial wire or cable that runs between a customer premise and a terminal or primary attachment, where no primary pole attachment of the attaching entity is present on the pole. A secondary pole attachment that is attached to the same pole as a primary attachment of the attaching entity is considered a component of the primary attachment for purposes of this rule].

G. "Wireless Provider" -- A corporation, partnership, or firm that provides cellular, Personal Communications Systems (PCS), or other commercial mobile radio service as defined in 47 U.S.C. 332 that has been issued a covering license by the Federal Communications Commission.

 

R746-345-3. Tariffs and Contracts.

A. Tariff Filings and Standard Contracts -- A pole owner shall submit a tariff and standard contract, or a Statement of Generally Available Terms (SGAT), specifying the rates, terms, and conditions for any pole attachment, to the Commission for approval.

1. A pole owner must petition the Commission for any changes or modifications to the rates, terms, or conditions of its tariff, standard contract or SGAT. A petition for change or modification must include a showing why the rate, term or condition is no longer just and reasonable. A change in rates, terms or conditions of an approved tariff, standard contract or SGAT will not become effective unless and until it has been approved by the Commission.

2. The tariff, standard contract or SGAT shall identify all rates, fees, and charges applicable to any pole attachment. The tariff, standard contract or SGAT shall set forth all non-recurring, standard charges for pole attachment work, including permitting, pre-construction surveys, inspections, and applicable processing. Other pole attachment work such as engineering, make-ready, and pole change-out shall also be identified in the tariff, standard contract or SGAT and billed on a time-and-materials basis for costs actually incurred and at rates or charges consistent with tariffs, standard contracts, or SGATs on file with the Commission. The tariff, standard contract, and SGAT shall also include but not be limited to:

a. permitting process, inspection process, joint audit process, including shared scheduling and costs, and any non-recurring fee or charge applicable thereto;

b. emergency access provisions; and

c. any back rent recovery or unauthorized pole attachment fee and any applicable procedures for determining the liability of an attaching entity to pay back rent or any non-recurring fee or charge applicable thereto.[

3. Any permitting requirement or annual rental charge shall not apply to a new service wire drop added to a pole on which an attaching entity already has a pole attachment or overlashes to an existing pole attachment.]

B. Establishing the Pole Attachment Relationship -- The pole attachment relationship shall be established when the pole owner and the attaching entity have executed the approved standard contract, or [andor adopted the approved tariff or ]SGAT, or other Commission-approved contract.

C. Exception -- [In situations in which the tariff and standard contract or SGAT does not cover certain aspects of a specific pole attachment relationship and t]The pole owner and attaching entity may voluntarily negotiate an alternative contract incorporating some, all, or none of the terms of the standard contract or SGAT.[, t] The parties shall submit the negotiated contract to the Commission for approval. In situations in which the pole owner and attaching entity are unable to agree following good faith negotiations, the pole owner or attaching entity may petition the Commission for resolution as provided in Section R746-345-6.[ An approved contract under this exception shall not materially deviate from the rates, terms and conditions, which are subject to Commission review under R746-345-3A(1), of the standard contract.]

 

R746-345-4. Pole Labeling.

A. Pole Labeling -- A pole owner must label poles to indicate ownership. A pole owner shall label any new pole installed after the effective date of this rule immediately upon installation. Poles installed prior to the effective date of this rule, shall be labeled at the time of routine maintenance, normal replacement, change-out, or relocation, and whenever practicable. Labels shall be based on a good faith assertion of ownership.

B. Pole Attachment Labeling -- An attaching entity must label its pole attachments to indicate ownership. Pole attachment labels may not be placed in a manner that could be interpreted to indicate an ownership of the utility pole. An attaching entity shall label any new pole attachment installed after the effective date of this rule immediately upon installation. Pole Attachments installed prior to the effective date of this rule, shall be labeled at the time of routine maintenance, normal replacement, rearrangement, rebuilding, or reconstruction, and whenever practicable.

 

R746-345-5. Rental Rate Formula and Methodology.

A. Basis -- The rental rate for any pole attachment must be based on a fair and reasonable portion of the pole owner's costs and expenses for the pole plant investment that is jointly used by an attaching entity. The rental rate for any pole attachment shall be based on the pole owner's investment in distribution poles. Any rate based on the rate formula in Subsection R746-345-5(B) shall be considered just and reasonable unless determined otherwise by the Commission.

B. Rate Formula -- A pole attachment rental rate shall be based on publicly filed data and must conform to the Federal Communications Commission's rules and regulations governing pole attachments, except as modified by this Section. A pole attachment rental rate shall be calculated and charged as an annual per attachment[pole annual] rental rate for each attachment space used by an attaching entity. The following formula and presumptions shall be used to establish pole attachment rates:

1. Formula:

Rate per attachment space[pole] = Space Used x (1/Usable Space) x Cost of Bare Pole x Carrying Charge Rate

2. Definitions:

a. "Carrying Charge Rate" means the percentage of a pole owner's depreciation expense, administrative and general expenses, maintenance expenses, taxes, rate of return, or other expenses that are directly or indirectly attributable to the pole owner's investment in poles. Carrying charge factors, except for the cost of capital, can be calculated on either a net or gross investment basis.

b. "Cost of Bare Pole" can be defined as either "net cost" or "gross cost." Gross cost means the original investment, purchase price, of poles and fixtures, excluding crossarms and appurtenances, divided by the number of poles represented in the investment amount. Net cost means the original investment, purchase price, of poles and fixtures, excluding crossarms and appurtenances, less depreciation reserve and deferred federal income taxes associated with the pole investment, divided by the number of poles represented in the investment amount. A pole owner may use gross cost only when its net cost is a negative balance. If using the net or gross cost results in an unfair or unreasonable outcome, a pole owner or attaching entity can seek relief from the Commission under R746-345-5 C.

c. "Unusable Space" means the space on a utility pole below the usable space including the amount required to set the depth of the pole.

d. "Usable Space" means the space on a utility pole above the minimum grade level to the top of the pole, which includes the space occupied by the pole owner.

3. Rebuttable presumptions:

a. Average pole height equals 37.5 feet.

b. Usable space per pole equals 13.5 feet.

c. Unusable space per pole equals 24 feet.

d. Space used by an attaching entity:

(i) An electric [primary ]pole attachment equals 7.5 feet;

(ii) A telecommunications [primary ]pole attachment equals 1.0 foot;

(iii) [An electric or telecommunications secondary pole attachment equals 1.0 feet]A cable television pole attachment equals 1.0 foot; and

(iv) [A cable television pole attachment equals 1.0 foot]An electric, cable, or telecommunications secondary pole attachment equals 1.0 foot.

(v) A wireless provider's pole attachment equals not less than 1.0 foot and shall be determined jointly by the pole owner and wireless provider. The space used by a wireless provider may be established as an average and included in the pole owner's tariff[,] and standard contract, or SGAT, pursuant to Section R746-345-3 of this Rule.

e. The space used by a wireless provider:

i. shall include the height of the pole above that which the pole owner would generally install to facilitate its own pole attachment or the pole attachments of any attaching entity;

ii. shall include actual placement of equipment and appropriate standard clearances for said equipment, of equipment placed in the usable space or unusable space on a utility pole;

iii. may not include any of the length of a vertically placed cable, wire or conduit, unless the vertically placed cable, wire or conduit prevents another attaching entity from placing a pole attachment in the usable space of the pole;

iv. may not exceed the average pole height established in Subsection R746-345-5(B)(2)(a).

v. In situations in which the pole owner and wireless provider are unable to agree, following good faith negotiations, on the space used by the wireless provider, the pole owner or wireless provider may petition the Commission to determine the footage of space used by the [W]wireless provider as provided in Subsection R746-345-3(C).

4. A pole owner may not assess a fee or charge in addition to an annual pole attachment rental rate, including any non-recurring fee or charge described in Subsection R746-345-3(A)(2), for any cost included in the calculation of its annual pole attachment rental rate.

C. Commission Relief -- A pole owner or attaching entity may petition the Commission to review a pole attachment rental rate, rate formula, or rebuttable presumption as provided for in this rule. The petition must include a factual showing that a rental rate, rate formula or rebuttable presumption is unjust, unreasonable or otherwise inconsistent with the public interest.

 

R746-345-6. Dispute Resolution.

A. Except as otherwise precluded by law, a resolution of any dispute concerning any pole attachment agreement, negotiation, permit, audit, or billing may be pursued through mediation while reserving to the parties all rights to an adjudicative process before the Commission.

1. The parties may file their action with the Commission and request leave to pursue mediation any time before []a [formal ]hearing[ on the record].

2. The choice of mediator and the apportionment of costs shall be determined by agreement of the parties. However, the parties may jointly request a mediator from the Commission or the Division of Public Utilities.

B. If the parties reach a mediated agreement or settlement, they will prepare and sign a written agreement and submit it to the Commission. Unless the agreement or settlement is contrary to law and this rule, R746-345, the Commission will approve the agreement or settlement and dismiss or cancel proceedings concerning the matters settled.

1. If the agreement or settlement does not resolve all of the issues, the parties shall prepare a stipulation that identifies the issues resolved and the issues that remain in dispute.

2. If any issues remain unresolved, the matter will be scheduled for a hearing before the Commission.

 

KEY: public utilities, pole attachment, telecommunications, telephone utility regulation

2004

54-4-13