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from: Milwaukee Journal Sentinel

Assembly nears approval of cable bill
State would issue franchises to providers

By STEVEN WALTERS
swalters@journalsentinel.com
Posted: April 24, 2007

Madison - The state Assembly on Tuesday tentatively approved a bill that would require state officials - instead of local governments - to issue cable TV and video broadcast franchises and investigate consumers' complaints.

On a 55-41 vote, the Assembly put the bill in a form that can no longer be changed. But opponents blocked a final vote until the Assembly meets again on May 8.

Earlier Tuesday, the Senate referred a similar version of the bill to the Legislature's Joint Finance Committee, which will sort out varying estimates of how many state workers would be needed to implement the new law.

Pushed mainly by telecommunications giant AT&T, which hired 15 lobbyists to work the Capitol, the bill would end the 30-year-old practice of local governments issuing cable TV franchises.

Supporters said the change would rewrite franchising laws passed in the 1970s and offer consumers choices to cable companies whose rates have soared.

"With competition, you say, 'I will not do business with you,' and you go to a competitor," said Rep. Phil Montgomery (R-Ashwaubenon), the chief Assembly sponsor.

"Which local government agency was in charge of protecting the consumer when cable rates went up over 178 percent over the last 10 years?" Montgomery added.

Montgomery said cable rates have fallen by up to 23% in states that have passed similar laws.

Changes in technology justify the bill, added Rep. Josh Zepnick (D-Milwaukee).

"Cable TV systems have been able to provide local and long-distance telephone service," for example, he added. "A single state franchise makes the most sense." The state could issue more than one franchise for any given community.

But opponents complained that competition will not occur in rural areas, the bill will dry up funding for local public access channels and it was being rushed through because of AT&T's lobbying clout.

AT&T has "been working certain legislators," said Rep. Gary Hebl (D-Sun Prairie).

Since January 2006, AT&T employees also donated more than $54,000, including $10,000 since mid-February, to dozens of legislators and Gov. Jim Doyle, the Journal Sentinel reported Sunday.

"This bill isn't as simple and pure as its presented," said Rep. Mark Pocan (D-Madison). "We're usurping local control completely."

Assembly members fought over dozens of issues, including attempts to have the Public Service Commission, which regulates utilities, approve rates charged by cable and video broadcast franchisees, and to give seniors and the poor discounts. Those moves were ruled out of order, however.

Backers of the bills made some concessions, including continued funding for local-access channels for up to three years, or until current franchises expire. Legislators said that would soon end funds for local-access channels in West Allis, Sheboygan, Ashwaubenon, Stevens Point and Wausau.

The Assembly also added a provision expanding privacy laws to prevent cable and video broadcast companies from selling information that identifies their customers and their viewing habits.

Under the Assembly bill:

• Permanent cable and video broadcast franchises are automatically granted to the largest national cable and video companies by the state Department of Financial Institutions.

The state Department of Agriculture, Trade and Consumer Protection would investigate consumer complaints, but that agency could not revoke franchises for consumer-protection violations.

• Local governments would get 5% of gross revenues of the franchisees - money that could be used to continue local-access public, educational and government channels.

• For the first time, satellite digital companies would face the same consumer-protection requirements - including a customer credit for four-hour service interruptions - as cable companies.

Estimates of how much the bill would cost the two state agencies to implement over the next two years have varied from $534,000 to $791,000. Some of those costs would be offset by a $2,000 application fee.

Senate Majority Leader Judy Robson (D-Beloit) said the Finance Committee must study the bill because costs estimates are "all over the map."

Doyle has not promised to sign the bill, if it makes it through the Legislature.