Industry Disagrees on Need for New Pole Replacement Cost Allocation Framework

Industry groups disagreed whether the FCC should adopt a new cost allocation framework and rules for pole replacements, in comments posted Tuesday in docket 17-84. The proceeding stems from a 2020 NCTA petition asking the FCC to clarify its pole replacement rules. The FCC adopted the Further NPRM in March in lieu of acting on the petition, noting the group “revealed inconsistent practices by utilities" on cost responsibility for pole replacements (see 2203180074).

The “time and expense required to replace aging poles is one of the most significant obstacles to broadband deployment,” said NCTA. The group asked the FCC to amend its rules to include its cost-sharing mechanism proposed in the 2020 petition and adopt a “rebuttable presumption that the only cost the attacher causes the pole owner to incur is the economic loss due to the early retirement of the replaced pole." The FCC should also require pole owners to maintain pole information, NCTA said, noting “mandatory record retention and increased information sharing by pole owners would greatly decrease the likelihood of disputes.” Incompas agreed, saying its members face "unreasonable delays and costs associated with access to poles, conduits, local permitting processes, and access to multiple tenant environments."

The FCC "must guarantee a more equitable division of costs between pole owners and attachers when poles must be replaced," said the Connect the Future coalition. Pole owners also "impose unnecessary delays by not acting on applications or imposing unwarranted limits on the number of applications or poles per application," the group said, delaying projects in unserved areas "for months or even years. The FCC should require pole owners to "share in the costs of new poles they purchase and install to accommodate attachments," said Charter, and codify a "rebuttable presumption that utilities benefit from replacement poles and should share in their cost," the ISP said. Require utilities to make a "substantiated finding" that there's "insufficient capacity" on an existing pole before assessing fees for a pole replacement, said ACA Connects, saying a new attacher shouldn't bear financial responsibility "when the accommodation of its requested attachment is not the cause for the replacement."

Pole owners “receive a direct benefit from pole replacement” and “must share in the cost of pole replacements,” said the Wireless Infrastructure Association. WIA backed NCTA’s proposals. The FCC's authority on pole attachment rules "could not be clearer" under Section 224 of the Communications Act, said TechFreedom, saying pole complaints in unserved areas should be resolved through the commission's accelerated 60-day docket. Next Century Cities disagreed, saying dispute resolutions through an accelerated docket "could potentially disadvantage municipalities that are under-resourced, understaffed, and unable to adequately respond."

The National Rural Electric Cooperative Association said it's “highly skeptical of suggestions by for-profit broadband providers ... that they cannot profitably deploy broadband unless electric utilities and their ratepayers finance their pole replacement costs and add to the government grants they already receive.” Allowing states to adopt their own policies on pole replacement funding "is better than imposing a federal mandate in the 28 states subject to commission jurisdiction,” NRECA said, and the FCC should reject the “one-sided and illegitimate push by the cable industry to require utility pole owners to reduce their legitimate cost-based pole replacement charges.”

Amending the current framework “would increase costs for communications providers and create costly and unnecessary disputes that would delay deployment,” said Verizon. The NPRM doesn’t “identify a valid reason to change the existing rules,” it said. "Responsibility for pole replacement costs is best left to cost-causing attachers, which can plan for and recover those costs from the customers they will serve," said AT&T. The current framework has led to "few disputes" between pole owners and attachers, it said, and "appropriately allocates costs to the entity causing them and in the best position to plan for them." USTelecom agreed, saying the FCC shouldn't "change its pole replacement cost allocation rules when they are not broken."

Current pole attachment rules "already provide an economical means of broadband entry and expansion" for cable and competitive local exchange carrier attachers by "ensuring them low-cost access to an extensive network of utility poles that are maintained by pole owners," said Lumen: Attachers "generally should pay the full cost of pole replacements necessary to accommodate their proposed attachments." The proposals "would most certainly slow the pace of broadband deployment," said Dominion Energy and Xcel Energy in joint comments. It would "eliminate every element of business certainty for utility pole owners,” the companies said, and the FCC could instead “encourage innovation and collaboration” between pole owners and attachers.