The Federal Communications Commission capped local regulatory authorities’ franchise fees at 5 percent, as of Aug. 1. These fees subsidize the cost of running and developing the programs broadcast on public access television stations.
Public access television is sometimes referred to as PEG-TV for its programming of public, educational and government topics. PEG-TV for North Haven is seen on channels 18, 19 and 20.
According to Walter Mann, executive director for NHTV, North Haven public access receives $70,000 from franchising fees and is further subsidized another $40,000 from the North Haven municipal government. This is in contrast to Wallingford, where that local authority, WPAA-TV, sees its entire $80,000 budget subsidized through franchise fees.
Between the two towns, the average subscriber costs add up to about $8 per year.
“The FCC would basically put a 5 percent cap on the total amount of financial payments that cable companies pay to the state of Connecticut for use of the public routes of way,” said Mann.
These “routes of way” are the municipal telephone poles cable companies require to transmit their content.
Originally, the order that the FCC voted on also included a point that cable companies would be able to charge municipalities for the public access channels towns use. For North Haven, channels 18, 19 and 20 are used by the town to broadcast forums, board and committee meetings as well as for educational programming. However, this charge to towns was taken out, allowing them to continue to keep their access to channels without a fee.
“Of course, if you don’t have the funding it’s kind of hard to operate the channels,” said Mann.
North Haven First Selectman Mike Freda, said that he and Branford First Selectman Jamie Cosgrove are “leading the charge” when it comes to safeguarding franchise fees.
“I addressed our United States congressional Senate district about the issue and I said ‘Please communicate to our United States senators and our congressional leaders that this is going to be an issue for us,’” Freda said. “I was delighted that after I gave that speech, a letter came from our U.S. senators to the FCC talking about this issue.”
The letter, dated July 29 and addressed to FCC Chairman Ajit Pai was signed by 14 senators. It said that the new order “puts at risk critical funding for public, educational, or governmental (PEG) stations, which are vital resources for residents across the country” that “educate voters, entertain children, and employ workers.”
“Cable companies have vastly underestimated the value of public access channels,” said Mann.
So why cap franchising fees at 5 percent?
According to FCC Commissioner Brendan Carr, what local franchising authorities have been doing up to this point have caused “harm” to consumers and are even illegal.
According to a report filed by the FCC last September, some localities had been abusing the use of franchise fees by asking for “in-kind contributions.” Instead of putting these contributions to use in promoting their public access stations, municipalities used them to fund “traffic light control systems,” a $50,000 scholarship and “money for wildflower seeds.”
Additionally, as Pai said in his own statement, local franchising authorities don’t have the power to regulate either cable or non-cable services “offered over a cable system.” This interpretation would open up public access to cable companies and promote competition between cable providers, according to Pai.
It should also be noted that throughout 2019, the Internet and Television Association spent a reported $6.6 million on lobbying to the FCC.
“So I’m glad we take these steps today to crack down on bad actors who seek to tax broadband and thus provide less access and competition for all of us,” reads Carr’s statement.
There is an exception to the 5 percent cap for any PEG channels that are “required” by municipalities. However, the order is vague on what they define “required” as.
“It’s so obtuse that it’s hard to know what the effects will be,” said Susan Huizenga, executive director for Wallingford’s WPAA. “What the FCC is saying is, people who represent local governments, whose rights of way are being used, are ‘bad actors.’”
Mann believes that NHTV’s PEG channels “would be exempt” but also recognizes that there is “a lack of clarity at this point.”
“On the one hand, if cable television companies are using public rights of way, they need to pay for it,” said Mann. “However, some towns have been making egregious demands like asking them to fund parades.”
If North Haven’s franchise fees are capped at 5 percent, Freda is already planning on how to continue funding production across the town’s three PEG channels.
“We will quickly determine what the total dollars will be and then we will look to continue to support NHTV to ensure that there’s no adverse effect on filming the meetings, that everything continues seamless,” he said. “We will deal with the complexity of floating the funding to keep NHTV in operation.”
Freda said that the town “will find the funding” without raising taxes and will be sure to include funding NHTV in next year’s budget.
“From a former CEO of a billion dollar company, now as a government leader, I see this on both sides,” said Freda. “There’s nobody on the corporate side that’s going to tell me that out of hundreds of channels that these cable companies have, that three channels are going to make a difference to them.”