In 2002, the METRO act was signed into law with the intention of making it easier to stimulate the availability of high-speed Internet connections.
As a reference to where this was in internet time, or the lifetime of streaming services, YouTube.com was registered in 2005. Yes, that's right, it didn't even exist.
Other states charge a lot more than the five cents per foot we receive here in Michigan. The fastest way to preserve the fees generated by Cable PEG and Franchise fees is to increase the fees to use the rights-of-ways. The METRO Act needs to be amended to keep up with today's technology. In Michigan, these fees, which don't just pay for video services, also help communities with road repair and public safety, to the tune of $100 million.
Here's a first draft of what we could do:
Proposed Amendment to the Metropolitan Extension Telecommunications Rights-of-Way Oversight (METRO) Act
Section 1: Purpose The purpose of this amendment is to modernize Michigan's METRO Act by ensuring fair compensation for the use of public rights-of-way by telecommunications providers. This amendment responds to the decline in Cable Franchise Fees and Public, Educational, and Governmental (PEG) fees due to the shift from traditional cable television to streaming services.
Section 2: Definitions For the purposes of this amendment, the following terms are defined as:
Gross Revenues: All revenue derived from the provision of broadband and fiber services within the municipality, including but not limited to subscriber fees, installation charges, and equipment rentals.
Public Rights-of-Way Use Fee: A fee assessed on telecommunications providers for the utilization of public rights-of-way.
Section 3: Compensation for Use of Public Rights-of-Way
Telecommunications providers utilizing public rights-of-way for fiber-optic infrastructure shall pay an annual fee based on:
Linear Footage Fee: $0.05 per linear foot of fiber installed within a metropolitan area.
Gross Revenue Fee: 3% of Gross Revenues derived from broadband services within the municipality.
These fees will be collected by the state and distributed as follows:
50% to local municipalities to fund public infrastructure and digital inclusion initiatives.
30% to state broadband expansion programs.
20% to offset losses in PEG and public information services.
Section 4: Precedents and Justification Several municipalities have successfully implemented similar fee structures:
Austin, Texas: Google Fiber Texas, LLC pays 3% of its Gross Revenues for right-of-way use. (see draft of the ordinance)
Round Rock, Texas: Imposes a local access fee of 1% on Google Fiber customers.
West Virginia: Implements fiber right-of-way fees per mile.
Alexandria, Virginia: Assesses a Public Rights-of-Way Use Fee of $1.20 per access line.
Section 5: Implementation This amendment shall take effect on [Effective Date], with compliance required within 90 days.
Section 6: Severability If any provision of this amendment is found to be invalid, the remaining provisions shall continue in full force and effect.
Conclusion By modernizing the METRO Act, Michigan will ensure fair compensation for public rights-of-way usage, support local infrastructure, and mitigate revenue losses from traditional cable franchise fees. This proposed legislation will not replace existing franchise and PEG fees but help mitigate the declining Cable fees revenue.
Let's get started.
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