Bill Summary for S 87 (2011-2012)

Summary date: 

Feb 17 2011

Bill Information:

View NCGA Bill Details2011-2012 Session
Senate Bill 87 (Public) Filed Thursday, February 17, 2011
TO PROTECT JOBS AND INVESTMENT BY REGULATING LOCAL GOVERNMENT COMPETITION WITH PRIVATE BUSINESS.
Intro. by Apodaca.

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Bill summary

Identical to H 129, filed 2/17/11.

Adds new Article 16A (Provision of Communications Service by Cities) to GS Chapter 160A to regulate local government competition with private business for purposes as indicated by the title.
Definitions. Provides definitions for the following terms as used in the proposed Article: (1) city-owned communications service provider, (2) communications network, (3) communications service, (4) high-speed Internet access service, (5) interlocal agreement, and (6) joint agency.
Requirements. Directs a city-owned communications service provider to meet all of the following specified requirements: (1) compliance with all local, state, and federal laws; (2) establishing one or more separate enterprise funds for the provision of communications service; (3) providing communications service only within the jurisdictional boundaries of the city that is providing the communications service; and (4) providing non-discriminatory access to necessary material, equipment, and facilities to private communications service providers unless the facilities have insufficient capacity for access and capacity cannot be reasonably added to the facilities. These requirements also include prohibiting the city-owned communications service provider from (1) airing ads or other promotions for the city-owned communications service on the city's public, educational, or governmental access channel and (2) directly or indirectly exercising any power or withholding or delaying the provision of a monopoly utility service to require persons to use or subscribe to a communication service provided by the city-owned communications service provider.
Provides that the following requirements do not apply to communications service provided by a city on or before January 1, 2011: (1) prohibition against subsidizing the provision of communications service with funds from other non-communications service or other revenue service, (2) prohibition against setting the price of any communications service at an amount less than the actual cost of providing the service, and (3) requiring the city to pay an annual amount equivalent to all taxes and fees paid by a private communications provider to the city's general fund.
Does not require a city-owned communications service provider to obtain voter approval under GS 160A-321 prior to the sale or discontinuance of the city's communications network.
Exemptions. Exempts a city's provision of communications service within its jurisdictional boundaries for the city's internal governmental purposes from the requirements of proposed GS 160A-340.1 (city-owned communications service provider requirements), 160A-340.4 (financing), and 160A-340.5 (taxes; payments in lieu of taxes). Additionally provides that the above proposed statutes do not apply to the provision of communications in unserved areas. Requires filing a petition to the Utilities Commission for a determination that an area is unserved. Defines unserved area as a geographical area in which at least 90% of households have no access to high-speed Internet service or only have access to high-speed Internet service from a satellite provider.
Notice and public hearing. Directs a city proposing to provide communications service to hold no less than two public hearings that are held no less than 30 days apart. Provides requirements for distributing notice of the public hearings. Provides that private communications service providers may fully participate in the public hearings. Declares that any feasibility study, business plan, or public survey prepared by the city in connection with the proposed communications service project is a public record under GS 132-1.
Financing. Prohibits a city or joint agency that is subject to the provisions of proposed GS 160A-340.1 (city-owned communications service provider requirements) from entering into a contract under GS 160A-19 (leases) or 160A-20 (security interests) to purchase, finance, or refinance (1) the purchase of property for use in a communication network or (2) the construction of fixtures or improvements for use in a communications network. These provisions do not apply to the repair or improvement of an existing communications network.
Taxes. Exempts a communications network owned or operated by a city or joint agency from property taxes; instead requires a city that has an ownership share of a communications network and a joint agency owning a network to pay to any county authorized to levy property taxes the amount which would be assessed as taxes on real and personal property in lieu of taxes. Directs a city-owned communications service provider to pay annually to the state an amount in lieu of taxes that would otherwise be due to the state if the service provider was a private communications service provider. Directs the Department of Revenue to set annually the amount of the payment in lieu of taxes. Provides that a city-owned communications service provider is not eligible for a refund under GS 105-164.14(c) (certain governmental entities allowed an annual refund of sales and use tax) for sales and use taxes except to the extent that a private communications service provider would be exempt from taxes.
Makes conforming changes to GS 62-3 (defining public utility). Makes a conforming change to Article 9A, (Borrowing by Cities for Competitive Purposes) of GS Chapter 159, Subchapter IV, enacting new GS 159-175.10 (additional requirements for review of city financing application; communication service).
Provides that a city that is a public utility under GS Chapter 62 when this act becomes law is not subject to the provisions of this act when it comes to any of the city's operations authorized under GS Chapter 62.
Provides that the provisions of this act are severable.
Effective when the act becomes law and applies to the provision of communications service by a city or joint agency under Part 1 of Article 20 of GS Chapter 160A on and after the effective date.

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