FCC Proposes Rules to Help America Win the Race to 5G
Last week, the Federal Communications Commission released a proposed order to help the United States win the race to 5G. The order, if adopted, would limit the types of policies localities and states may adopt regarding cell antenna deployment, establish guidelines for localities when setting fees for rights-of-way or antenna application reviews, establish more stringent shot clocks for municipalities and place further guardrails on municipal rules while recognizing localities’ traditional roles regarding cell antenna deployment.
The proposal specifically applies to 5G, or small cell, deployment. By way of review, 5G is the next technology for cell phone communications. 5G is faster and has greater capacity than the current standard, 4G. 5G will allow more devices to connect to the communications infrastructure than ever before; it will further enable the Internet of Things, allow vehicles to talk with each other, make telemedicine a possibility for rural areas and so much more.
The new technology is also far more cost and energy efficient. The antennas are much smaller than 4G antennas and require less power. Because of the size, energy savings, and anticipated demand, cell providers will need to deploy far more antennas than for 4G. By at least one estimate, for example, companies may need to deploy hundreds of small cells to cover a square mile or two, depending on anticipated demand.
Some large localities, such as San Jose, California, are more interested in essentially extorting money from cell companies rather than focused on ensuring deployment that reaches all their citizens. When localities are focused on revenue, they tend to charge companies exorbitant sums just to deploy. Comments submitted in support of the order, for example, cites Cottleville, Missouri which “recently interpreted its 20 year old business license fee as requiring an annual $6,000 payment per antenna,” Dallas, Texas, which would have charged roughly $280,000 per year for deployment, or Portland, Oregon, which charges providers $7,500 per antenna plus an annual fee of $5,500 or $3,500 per antenna depending on the location.
Economists estimate that the FCC’s proposed order would “save $2 billion in unnecessary costs and stimulate an additional $2.4 billion in infrastructure investment.” This is investment that providers will use to deliver services to unserved and underserved communities.
To solve the problem of exorbitant fees, the FCC proposal places two guardrails. First, it prohibits any fee or practice that has the practical effect of prohibiting deployment. High fees, delays, and other tactics localities employ have the effect either of prohibiting deployment within the local jurisdiction or consume a company’s resources to the point where it prohibits deployment elsewhere. The FCC, while respecting traditional state oversight of local governments, seeks to use authority provided it by Congress to prohibit these delay tactics.
Second, the FCC defines what types of fees localities may collect, and how localities should calculate those fees. In a nutshell, the FCC order would move to a cost-based fee calculation. This would limit localities to recovering moneys expended processing the applications for small sells, such as building permits, parking fees, engineering fees, and so on.
Third, the proposal would permit local governments continued oversite of deployment within certain limits. Congress, when banning policies that prohibit deployment, ensured that local governments would still have control regarding aesthetics and undergrounding.
Fourth, the proposal would establish two new shot clocks: 60 days when an application would collocate on an existing structure and 90 days for new builds. The proposal would further codify the existing 90 and 150 day shot clocks for traditional wireless facilities. If a locality fails to act within the times provided by the shot clocks, the FCC would deem the failure to act as a presumptive prohibition on deployment, allowing the company to file suit in court, requesting that the court compel the locality either to act or approve the requests.
The FCC’s proposed order is a positive step forward if the United States wants to win the race to 5G. Winning the race means re-imagining the regulatory and legislative landscape. With this proposed order, the FCC does just that while respecting the traditional role held by local governments reviewing applications and the traditional role of state governments overseeing local governments.