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from: Waxing America

AB 207 Amended; Worst Aspects Fixed Somewhat

April 17, 2007

AB 207 passed the Assembly Committee on Energy and Utilities today on a vote of 8-1. There were a number of amendments introduced by Chairman Montgomery, several of which improved the bill significantly. I'm still reviewing them, but at first glance they:

* Restore franchise fees by keeping advertising and home shopping revenues in the gross revenues base.
* Protect PEG channels somewhat regarding both transmission costs and the programming levels to meet the "substantially utilized" test for a channel.
* Allow the Department of Financial Institutions to engage in limited rulemaking and oversight regarding the qualifications of applicants for a state video franchise.
* Restore the existing set of subscriber rights regarding consumer protection and apply them to video service providers, cable operators and (GASP!) satellite service providers under the Department of Agriculture, Trade, and Consumer Protection. This last addition is a stunner. I applaud it, but wait until Direct TV finds out.

These last two items will significantly increase the amounts of the fiscal notes outlining the costs of state franchising. The notes for the state to do almost nothing under the original bill estimate $312,000/yr for DATCP and $219,500/yr for DFI, or slightly over a half milliion dollars. The amended bill, which does require significantly more oversight on the part of these two agencies, would at least double that amount.

Judith Davidoff of the Capital Times details both AT&T's and the cable industry's fingerprints on the bill, which I found when reviewing the drafter's file for AB 207 at the Legislative Reference Bureau.

A legislative drafting memo shows that AT&T and the Wisconsin cable industry had a heavy hand in shaping a controversial video franchising bill before it was introduced to the state Legislature, critics of the bill say....

In a March 21 memo, Mark Kunkel of the Legislative Reference Bureau details the "instructions" he said he received during a Feb. 20 meeting with James Barrett, senior counsel of AT&T Wisconsin; Buddy Julius, director of government affairs at AT&T Wisconsin; Tom Moore, executive director of the Wisconsin Cable Communications Association; and Adam Raschka, aide to Rep. Phil Montgomery, R-Green Bay, the primary author of the bill. John Stolzenberg, chief of research services for the Wisconsin Legislative Council, was also at the meeting; Tara Corvo, an attorney from Washington, D.C., who also represents the cable association, joined the conversation by phone.

Among other instructions, Kunkel noted that he was directed to include a rebuttal to anticipated criticism that the bill would illegally supersede franchise agreements between cities and cable companies. Wisconsin's cities received approximately $31 million in franchise fees in 2004, according to the Department of Revenue.

University of Wisconsin telecommunications Professor Barry Orton, who provided the drafting memo to The Capital Times, said the document shows that the two industries affected by the bill "got together with the drafter and said, Here's what we want.' "

The Wisconsin Cable Communications Association has officially taken a neutral position on the bill, but this memo raises questions about their actual involvement, says Orton and Rich Eggleston, spokesman for the Wisconsin Alliance of Cities. They are being disingenuous to say they are officially neutral," said Eggleston, a critic of the bill...

Eggleston said his group, which represents cities around the state, was not asked to provide input on the bill.

"If we're not at the table, too often we're on the menu," he said.

- Barry Orton

Update: Forgot to link Mark Pitsch's Wisconsin State Journal story on the drafting memo. I managed to stay out of that one. Both stories were page one on a huge news day. Rich Eggleston earned his salary this week.