Today, the first Monday of October and the official beginning of the Court’s 2013 Term, the U.S. Supreme Court denied a petition for certiorari filed by several electric utilities, including American Electric Power (AEP), seeking review of the D.C. Circuit Court’s decision affirming the FCC’s April 2011 Order allowing incumbent local exchange carriers (“ILECs”) to petition the FCC to obtain just and reasonable rates, terms and conditions for their pole attachments on electric utility poles, under the federal Pole Attachment Act (“Act”). Prior to the FCC’s April 2011 Order, the FCC had interpreted the Act to apply to cable companies and competitive local exchange carriers (“CLECs”) only. While ILECs will now be able to challenge unreasonable rates, terms and conditions at the FCC in much the same way as cable companies and CLECs already do, there are differences:

  • First, existing “joint use” agreements (i.e., agreements between joint pole owners), which typically give reciprocal rights to the parties, will generally be considered reasonable. 
  • Second, the ILEC must show that it is similarly situated as a cable company or CLEC to obtain comparable rates, terms and conditions. For example, if an ILEC is not a pole owner but merely an attacher in a particular region, the FCC might find that the ILEC, in that instance, is “similarly situated” to a cable company/CLEC and in an inferior bargaining position to the electric utility pole owner. 
  • Third, the FCC’s “old” telecom rate will be the starting point in any rate case where the ILEC is not similarly situated to account for particular arrangements (e.g., no make-ready payments) that provide net advantages to an ILEC relative to cable companies/CLECs. 
  • Last, ILECs do not have a right of access to electric utility poles under the federal law and any access challenge must be pursued at the appropriate state public utility commission.

For background, and a more comprehensive analysis of the Order and the D.C. Circuit Court’s decision, please see our blogs and advisories on the electric utilities’ May 2013 petition, the D.C. Circuit’s February 2013 decision, and the FCC’s April 2011 Order.