FCC OTMR Ruling: What Is It and What Does It Mean for Electric Utilities

In its August 2018 meeting, The Federal Communications Commission (FCC) issued a Report and Order and a Declaratory Ruling establishing new regulations governing pole attachments. I know what you’re thinking, but for once, this isn’t all bad news.

The primary regulation, called One-Touch Make Ready (OTMR), is the equivalent of a “Dig Once” policy for overhead attachments to utility poles. Unlike the FCC’s often-pushed, poorly-reasoned idea that reduced pole attachment rental rates will increase broadband deployment, OTMR actually has a chance to reduce broadband deployment costs, more efficiently use resources, and help new market entrants.

Here’s how One-Touch Make Ready works (according to Verizon).

So the concept is straight-forward, but what are the takeaways for your utility?

The rules may not apply to you. If you are a municipal, electric cooperative, or if your service territory is in a state not regulated by the FCC for pole attachments (list of states that have certified to the FCC that they regulate their own pole attachments), you are not bound by any FCC pole attachment regulations, including OTMR.

OTMR is better than the alternative, but it is still a lot of work. OTMR holds the promise of bringing common sense and efficiency to your operations, and it interrupts the ability of incumbents to stall new entrants in the broadband service game. That is all good news. Still, if you are required to follow OTMR, or if you choose to follow its rules, you will need to take several steps to ensure the process is administered well and implemented successfully. 

Among the first steps you’ll need to take: 

• Develop a list of approved engineering and construction contractors who are approved to design and build on your system
• Update points of contact for the construction group of your attachers and brief them on the new workflow process
• Determine which scenarios will be appropriate for one-touch make ready and which will not (for example, one-touch make ready is often allowed for “simple” transfers that don’t require splicing, but not allowed for “complex” transfers)
• Update your internal stakeholders (construction crews, accounting department, mapping department, etc.) on the new workflow
• Update your existing pole attachment agreements to reflect the change in workflow

Of course, once these things (and others) are done, you’ll need to stay on top of the process (and your attachers) to be sure it happens.

OTMR is the headliner, but the devil is in the details. In addition to the Report and Order on OTMR, the FCC issued a Declaratory Ruling asserting that state and local authorities do not have the right to enforce a moratorium on broadband buildouts. This is an interesting development in a few ways: 

• It seemingly takes away a utility’s right to manage it’s attachers by shutting down their permitting process. Now, if a utility has a safety, reliability, or engineering concern about an attacher, it would still have the right to stop a bad actor, but this type of language creates a gray area about the permitting process where none before existed – namely, that a utility might not be able to stop an attacher from attaching to its pole.
• It DOES impact state and local authorities (particularly municipalities), which have long been off-limits from pole attachment regulation, by citing Section 253 of the Communications Act rather than the Pole Attachment Act (47 U.S. Code Section 224), under which municipal and cooperative utilities are specifically exempt. This alone makes for an aggressive step by the FCC to regulate state and local authorities. Have no doubt that APPA, NRECA, and other advocacy groups will be fighting hard against future dents in the local control armor that has long been in place. 

For more details on these latest gripping developments in the world of pole attachments, take a look at some of the links in the “Industry News” section of our newsletter below or get in touch with us to discuss.