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HomeMy WebLinkAboutItem 8.3 AT&T Lightspeed Project CITY CLERK File # [JwUJ[[]-~{l] , . X [e{it.- llf AGENDA STATEMENT CITY COUNCIL MEETING DATE: December 5,2006 SUBJECT: ATTACHMENTS: RECOMMENDATION: I'- ./'1. . ^\~AY 2. FINANCIAL STATEMENT: Status of AT&T Project Lightspeed and Summary of Digital Infrastructure and Video Competition Act of 2006 (AB 2987) Report Prepared by: Melissa Morton, Public Works Director, John D. Bakker, Assistant City Attorney, and Leah Peachey, City Attorney's Office 1. 2. 3. Summary of Key Provisions of AB 2987 Photo of SAI box along Wineberry Way Draft Typical Conditions for AT&T Project Lightspeed Cabinet Permits Receive Staff presentation, and Provide direction to Staff regarding (a) the issuance of encroachment permits and site work permits for Project Lightspeed facilities prior to AT&T's receipt of a state franchise, and (b) the adequacy of Staff s proposed conditions and standards for such permits. None. DESCRIPTION: This Staff Report is intended to provide a description of and update on AT&T's Proj ect Lightspeed. Proj ect Lightspeed is AT&T's initiative to upgrade its existing telephone network to allow it to provide its customers with higher speed internet access and video programming services, much like cable television. This Report also summarizes Project Lightspeed in light of the recently enacted "Digital Infrastructure and Video Competition Act of 2006" (AB 2987), which AT&T and other telecommunications companies shepherded through the Legislature this summer. This legislation provides AT&T the opportunity to seek a state franchise that allows it to provide video programming services without a cable franchise agreement with the City. State franchises will not be available until early next year, but AT&T has indicated to Staff that it would like to move forward with COPY TO: Shiyama Clunie, AT&T Page 1 of 4 ITEM NO. <t. 3 G:\PERMITS\ENCROACH\Project Lightspeed\agst Status ATT Project Lightspeed & AB 2987 (2).DOC CJ upgrading the telephone network in antIcIpation of providing such services. To date, AT&T has submitted seven encroachment permit applications for Project Lightspeed-related work. Staff is seeking direction on how these requests should be handled. AT&T Proiect Lightspeed Telephone corporations such as AT&T (formerly SBC) are developing products that use the existing telephone network to provide cable television-like services, along with other broadband internet services. Project Lightspeed consists of a fiber-optic based, Internet Protocol (IP) network that will be capable of providing integrated data, voice and video services. AT&T anticipates using the system to provide cable television-like services to its customers, as well as telephone, audio and internet services. AT&T is in the midst of rolling out Project Lightspeed in select areas of California and has informed Staff that it would like to provide these services throughout Dublin. Project Lightspeed's basic network upgrades (at the local level) involve bringing high-capacity fiber-optic cables to service area interface (SAI) cabinets that exist throughout AT&T's telephone network. Each SAI box serves between 200 and 600 homes and businesses. AT&T has indicated that there are at least 26 SAI cabinets in Dublin. From each SAI cabinet, copper telephone lines are routed to each customer's premises. The existing copper telephone lines from the SAI cabinets to the customer premises will continue to be used for Project Lightspeed; by contrast, Verizon is completing a similar upgrade project in other parts of California where it is the local telephone provider bringing "fiber to the premises." In order to provide Project Lightspeed services to the customers served by a particular SA! box, AT&T will install a new cabinet (the so-called VRAD) near the existing SAI cabinet. There are three such VRAD cabinets of varying sizes; the most prevalent is the 52B cabinet which can provide service to approximately 400 customers. The 52B cabinet stands approximately 63 inches high and 43 inches wide. The depth is about 20 inches. The larger cabinet is approximately the same height but is approximately twice as deep. The length and condition of the copper lines located between the VRAD and the customer premises is the key constraint in providing the high speed data service that is necessary to provide Project Lightspeed services. It is the City's understanding that when the length of these copper lines from the VRAD to the customer premises is longer than 4,000 feet Project Lightspeed services cannot be reliably provided. In practice, this may mean that even if AT&T installs VRADs at each of the SAI cabinets in Dublin, some premises may not receive Project Lightspeed services due to this technical constraint. Existing Legal Framework (Pre-AB 2987) Under state and federal law, cable television operators are required to obtain a local franchise from the franchising authority, generally the local government served by the cable operator, prior to constructing a cable system (47 U.S.C. ~ 541(b); Gov. Code, S 53066). The basis of the federal law franchise requirement is that the cable operator is using the public streets for its facilities. Thus, the City has a current cable franchise agreement with Comcast, which is effective until June 1,2011. By contrast, under state law, telephone corporations are not required to obtain a local franchise to provide telephone and information services. State law gives these entities the authority to construct telephone lines in and along any public right-of-way (the so-called "statewide franchise"), subject to certain time, place and manner regulations, which are discussed on page 3 of this report (Pub. Util. Code ~ 7901, 7901.1). Page 2 of 4 New State Franchise Procedure for Video Service Providers (AB 2987) The legal framework relating to cable franchising will change significantly when AB 2987 becomes effective on January 1, 2007. AB 2987 establishes a statewide franchising procedure for video service providers to be administered by the California Public Utilities Commission (CPUC). When it is issued a state franchise under AB 2987, AT&T will have the right to install facilities to be used for the provision of video programming services in the public rights of way without a local franchise in the same manner that telephone lines and facilities can be installed. Attachment 1 contains a more detailed description of the key provisions of AB 2987. In brief, AB 2987 contains a number of provisions designed to make franchising agencies, like Dublin, more or less whole. Thus, cities and counties in the area in which a state franchise is issued will receive the equivalent of franchise fees from state franchise holders, and state franchise holders will be required to provide public, educational and governmental channel access and capital support. In addition, AB 2987 contains provisions designed to ensure that neighborhoods are not discriminated against on the basis of household income. It should also be noted that AB 2987 provides that incumbent cable operators, such as Comcast, may opt out of existing franchises once a new state franchise holder enters the jurisdiction; however, the incumbent's new state franchise would not be operative until January 2,2008. AT&T's Request to Begin Network Upgrades Before Receiving State Franchise In anticipation of obtaining a state franchise, AT&T has approached Staff to request issuance of a total of seven encroachment permit applications for VRAD cabinets. The requests include the four sites for construction of VRAD cabinets, and three more recently-submitted applications to place VRAD cabinets in existing underground environmental vaults. AT&T does not yet have a state franchise, and therefore Staff believes that AT&T has no legal right to install facilities that will be used to provide cable services. Accordingly, the City could condition the issuance of permits on AT&T agreeing to obtain a local franchise or a state franchise prior to providing video service. AT &T has indicated that it is unwilling to accept such a condition, but points out that issuing the permits now will result in the services being available sooner than otherwise might be the case. If the issues with the siting and design of Project Lightspeed cabinets described in the section below can be resolved, Staff could issue the permits with a "reservation of rights" condition suggested by AT&T. This condition would basically provide that the permit in no way affects AT&T and the City's positions with respect to whether a local franchise is required by federal or state law. Given that Staff anticipates AT&T being issued a state franchise soon after AB 2987 becomes effective on January 1, 2007, this seems like a reasonable approach. (The permits would also be subject to a condition requiring the facilities to be removed if they are ever abandoned or unused for a period time that has yet to be determined. ) Staff is asking for direction on whether it would be appropriate to issue permits now or whether permit issuance should be withheld until AT&T has a state franchise. Siting and Design ofProiect Lightspeed Cabinets Since the VRAD cabinets must be located near the existing SAI cabinets, Staff is concerned that in some cases, AT&T may wish to locate the boxes in unsightly locations or in locations that substantially impact nearby residents. As an example, Attachment 2 shows the location of an SAI cabinet in a constrained Page 3 of 4 location. AT&T has indicated that it has some flexibility in placing the VRAD cabinets, but constrained sites such as the site depicted in Attachment 2 may nonetheless result in the placement of cabinets in undesirable locations. Additionally, to the extent that the VRADs are moved, it may reduce the number of customers that can receive Project Lightspeed services. The typical process that AT&T and the City follow when AT&T performs construction on its telephone system is for AT&T to obtain an encroachment or site work permit from the Public Works Department, and building and electrical permits if necessary. In some locations, it appears that site development review may additionally be required. Encroachment permits and site work permits do not involve public hearings and are issued by Staff. To date, AT&T has expressed a willingness to work with City Staff to locate the sites in acceptable locations. Although AT&T has not made any formal commitments as to a process for locating the boxes and seeking public input before submitting permits that could be controversial, AT&T has committed to such processes in other cities and would likely commit to a similar process in Dublin. Staff believes that these questions could be dealt with in the encroachment and site work permit process, and that it is possible to work with AT&T to site the cabinets in the most unobtrusive location given the various constraints at each individual site. City Staff has prepared a set of draft conditions that would be imposed on such permits (Attachment 3). Staff is seeking direction from the City Council on whether the proposed conditions are adequate to protect the interests of the City. RECOMMENDATION Staff recommends that the City Council: 1) Receive Staff presentation, and 2) Provide direction to Staff regarding (a) the issuance of encroachment permits and site work permits for Project Lightspeed facilities prior to AT&T's receipt of a state franchise and (b) the adequacy of Staff s proposed conditions and standards for such permits. Page 4 of 4 /0+7 Summary of Key Provisions Digital Infrastructure and Video Competition Act of 2006 (AB 2987) The legal framework relating to cable franchising will change significantly when AB 2987 becomes effective as of January 1, 2007. AB 2987 establishes a statewide franchising procedure for video service providers to be administered by the California Public Utilities Commission (CPUC) and preempts local government franchising authority under both federal and state law. (Pub. Util. Code ~ 5840(a).) Thus, phone companies that are pursuing initiatives to provide video programming services, like AT&T, may seek a state franchise from the CPUC, and the City may not require a separate franchise for the provision of video services. In addition, AB 2987 provides that incumbent cable operators, such as Comcast, may opt out of existing franchises once a new state franchise holder enters the jurisdiction; however, the incumbent's new state franchise would not be operative until January 2,2008. (9 5930(b ).) AB 2987 provides that the CPUC must begin accepting applications for a state franchise by April 1, 2007. Based on recent pronouncements from the CPUC and AT&T, itis anticipated that AT&T will apply for a state franchise as soon as the CPUC begins accepting applications in early 2007 and will be issued a state franchise shortly thereafter. The following subsections highlight the main provisions of AB 2987. Franchise Fees AB 2987 establishes a franchise fee of five percent of gross revenues, which the state franchise holder must calculate and remit directly to the City. (~5840(c).) "Gross revenues" include: 1) charges billed to the subscriber for cable or video service; 2) franchise fees passed on to subscribers; 3) commissions paid to the state franchise holder for product promotion (i.e. "home shopping" channels); and 4) a pro rata portion of all revenue derived from compensation arrangements for advertising. (9 5860(d).) Where a state franchise holder provides a bundled-service package to subscribers, such as AT&T's Project Lightspeed, the franchise fee will only apply to the gross revenue attributable to video service. (9 5860(f).) Public, Educational and Governmental Channels and Facilities AB 2987 requires a state franchise holder to provide the same number of public, educational, and governmental (PEG) channels as the incumbent cable operator has activated. (~5870(a).) AB 2987 also preserves all obligations in existing franchises to provide and support PEG channel facilities and institutional networks (I-Net) and to provide cable service to community buildings, until the franchise expires. (~5870(k).) After January 1, 2007, any existing unsatisfied PEG facilities or I-Net obligations will be divided among all cable or video providers on a pro rata per subscriber basis. (~5870(1).) Discrimination and Build-Out Requirements The federal Cable Act contains provisions that prohibit cable operators from discriminating on the basis of a particular residential neighborhood's income. AB 2987 contains provisions designed to con:Ply wi~ this mandate and some additional build out requirements. ~. 3 ) 2/6, tJ b ATTACHMENT I. 1 Jof7 AB 2987 sets forth non-discrimination requirements for all video service providers, as well as additional build-out requirements for large telephone corporations. (~5890(a).) To comply with the non- discrimination provisions of AB 2987, state franchise holders or their affiliates with more than one million telephone customers must meet the following conditions: 1) within three years of beginning service, 25 percent of the households with access to the holder's video service are low-income households; 2) within five years of beginning service, 30 percent of the households with access to the holder's video service are low-income households; and 3) state franchise holder provides service to one community center for every 10,000 video customers. (9 5890(b).) Low-income households are those households where the average annual household income is less than $35,000. (9 5890G)(2).) In contrast, state franchise holders or their affiliates with fewer than one million telephone customers must offer video service to all customers in the telephone service area within a reasonable time, as determined by the CPUC. (95890(c).) In addition, AB 2987 provides build-out requirements umelated to household income for state franchise holders or their affiliates with more than one million telephone customers in California. (95890(e).) Ifa state franchise holder is predominately deploying fiber-optic facilities to the customer's premise, the holder is required to provide video service to between 25 percent of the customer households in the franchise holder's telephone service area within two years after it begins providing service, and to 40 percent of those households within five years. (95890(e)(1)&(2).) AT&T's "telephone service area" is the territory in which it is the provider of local telephone service. G:\PERMITS\ENCROACH\Project Lightspeed\AB 2987 Summary Key Provisions.doc 2 1:1 \1 .- ~ (0 co o ...... III II f ~" III Ii, ~ III Q ~ L 'Il iii "iii " "'A ., ;'_l.?,,/, ~ :S; {-'f. "$; C;;l ~. :(.,~ ~ !' .!:- .' ,~ ATTACllMENT z. '. " I f {. {I" ,~~;.~ .:;,." "i'i~ltJ;~: , !>'iti'X' fiLJ .; rJI/t -':''\;;:;,~~-',t:~'''~ ~. . / ""';I~:"i";l~ '2 "/< \ ': i .~ r t "~1t.;,.\'~r; . I : ~, ~~:il, /0- .. -:_~'l!'\ . ... ;e..i I ." ~...r t /. .'~ " ~~i.i ~t ',\,' 'j;, ,~.... ~I ..y~ ~;.I , ,t'" 'J " l~... " J',J* ,tf\~" ~_I,~., d ':'-.\1 " .', -:-. .,,'fi,.~ '"!4- ~ .- , ill ~ . II '.\\ :!~ '71 > . , -"" J l~J . , "'1 ,".. "'J .~ ...... ~~l /1 I · ,~ :- gJ ~"" "~j J 1~ \'1 f~i t/~ I~~I 'I ,.. '1 II: , i j , 1\ to. (~' , . f~:t ,. - ~ f , .., .~ " ."., . -',,.. 5017 Sample Conditions Conditions for AT&T, Permit #: Location: Permit Fee: $*** These conditions are in addition to the standard permit conditions printed on the reverse of the permit form. 1. Working hours shall be 7:30 a.m. to 5:30 p.m. Monday through Friday. Specific hours that lane closures will be allowed for your work location are: o D D Dublin Boulevard from San Ramon Road to Dougherty Road: Lane closures, other than those of brief duration, shall not be allowed during daytime hours unless otherwise approved in writing by the City. Working hours on this portion of Dublin Boulevard shall be 8:00 p.m. to 6:00 a.m. Closure of more than one lane at a time may be allowed from 10:00 p.m. to 5:00 a.m. at the City's discretion. Other Arterial Roadways: Lane closures shall not be allowed prior to 9:00 a.m. or after 3:30 p.m. unless otherwise approved in writing by the City. As follows: Work outside the designated hours, as well as weekend and holiday work, will not be allowed except with prior written permission of the City. 2. Traffic control shall conform to current Caltrans or MUTCD standards. A location-specific traffic control plan shall be approved by the City prior to the beginning of work. 3. A pre construction meeting with the City's inspector is required prior to beginning work. 4. Trench and concrete construction shall conform to current City of Dublin standard details, which are available through the City's website at www.ci.dublin.ca.us. or for purchase at the Civic Center, 100 Civic Plaza, Dublin CA. All restoration shall conform to current City of Dublin standards. If the paved area includes striping or marking, such shall be replaced along with final pavement. 5. Adjacent businesses or residences shall be notified in writing at least 72 hours prior to the beginning of construction. The notice shall include the name and telephone number of at least one contact person who is able to answer public inquiries regarding the work. A copy of the notice shall be provided to the City. 6. Access to businesses or residences must be maintained. If a property has more than one driveway, only one driveway may be closed or blocked at a time. If only one driveway serves the property, only half the driveway may be closed or blocked at a time. Property owners shall be contacted at least 24 hours in advance of any driveway closures or other activities affecting the property. 7. Coordinate with other work in the area. If a conflict occurs, the City of Dublin shall determine the priority. 8. Pedestrian and wheelchair access in sidewalk areas shall be maintained at all times. If a sidewalk must be temporarily closed to pedestrian traffic, an alternate route shall be provided and signed appropriately in conformance with accepted standards. ATTAOOIENT 3. hJ7 9. Any landscaping that is disturbed as a result of permittee's work shall be restored to the satisfaction of the City and/or private property owner, as applicable. 10. Marking for City traffic signal, street lighting, and irrigation facilities shall be requested direcdy from the Public Works Department over and above USA notification. Any damage to traffic signal, street lighting, or irrigation facilities that results from permittee's work shall be repaired operationally at once and permanendy within 48 hours. The permittee shall be responsible for obtaining an acceptable contractor to perform the work. If permittee fails to or chooses not to make the repairs within the allotted time, the City shall make the repairs and charge permittee for the cost, plus administrative fees. 11. The public right of way shall be kept clean and swept daily, at a minimum, or as required by the City's representative. All work, e.g., cleanup, storage, and disposal of material, shall comply with environmental regulations, including the Clean Water Act. 12. Trenches and excavations shall not remain open except when permittee or permittee's contractor is present and performing work. Site security shall be to the satisfaction the City. 13. Permittee or permittee's contractor shall obtain a City of Dublin transportation permit for any extra-legal vehicles or loads. 14. A City of Dublin Building Permit is required for any related electrical work, including meter (service) enclosures. 15. Work outside the public right of way shall occur in an easement that is intended for public utilities or services. Where there are no existing easements, an easement shall be obtained from the property owner prior to beginning work. Drawings submitted with permit applications shall include the locations of right of way lines and easement boundaries. Work outside the public right of way may be subject to a City of Dublin sitework permit and may require installation of landscaping or other screening. Sites will be reviewed on an individual basis in terms of access, grading, drainage, and potential impact on adjacent property, and additional conditions may be imposed accordingly. 16. Each cabinet shall be painted with graffiti resistant paint. The existing cabinet shall also be repainted with graffiti resistant paint to match the new cabinet. 17. Each cabinet shall include contact information of the company. The information shall include the agency's address, name and phone number. The City shall also be provided with the name, address, phone number and email address of the person with the agency who is responsible for the maintenance of the exterior of the unit including the repainting of the cabinet or graffiti removal. 18. The cabinet and landscaping shall be maintained in a "like new" condition at all times. The cabinets shall be periodically inspected and repainted or landscaping replanted as necessary or as required by the Community Development Director and/or the Public Works Director. 19. Landscaping shall be installed around the sides and rear of the cabinet to screen the cabinet (s). Drought tolerant evergreen shrubs which have a minimum size of five gallons shall be planted around the cabinet. The shrubs shall be planted so as to completely screen the sides of cabinet within one year. At no time shall the landscaping be removed without the permission of the 70/7 Community Development Director. Landscaping may only be removed if replaced within two weeks by the same species. 20. In the event of the abandonment or nonuse of the improvements installed pursuant this permit, the City may order the permittee to promptly remove the improvements and restore the site to its prior condition. In the event that the permittee does not remove the improvements within 60 days (or such longer period established by the City) of being so ordered by the City, permittee agrees that the City may remove the improvements and charge the costs thereof to the permittee.