Federal Court Strikes Down Maryland Right-of-Way Franchising Ordinance

U.S. District Judge Catherine C. Blake has enjoined Prince George's County, Maryland, from enforcing its recently adopted Telecommunications right-of-way franchising ordinance (Bell Atlantic-Maryland Inc. v. Prince George's County, Maryland, May 24. 1999). The local ILEC, Bell Atlantic - Maryland, had sought the injunction on the grounds that (1) the ordinance was beyond the County's homerule authority; (2) Bell Atlantic was grandfathered in the County's rights-of-way by reason of the incorporation of a predecessor in the last century and under franchises issued by the County shortly after the turn of the century; and (3) the ordinance prohibited entry in violation of Section 253 of the Telecommunications Act of 1996. The County has appealed the injunction to the U.S. Court of Appeals for the Fourth Circuit in Richmond.

"Me-too" suits by U S Sprint, which claimed to be a pure reseller, and by AT&T remain pending before Judge Blake in Baltimore.

While Judge Blake's opinion seems to hold that the County may require franchises from telecommunications providers and that many of the right-of-way management provisions of the ordinance are valid, she struck down the gross-receipts-based fee and franchise application procedures as having been preempted by the federal act. Declining to be bound by the severability clause in the ordinance, she enjoined the ordinance in toto.

Judge Blake held that Section 253 allows only cost-based fees, although she seems to take a generous, economic view of costs. Her decision intimates that resellers are exempt from franchising fees and regulation. The application procedures in the aggregate she found to be overly burdensome, leaving too much discretion in the County to deny or condition entry, thereby prohibiting entry within the meaning of the act. She did not find it necessary to reach the state law issues.