SENATE, No. 3062

STATE OF NEW JERSEY

214th LEGISLATURE

 

INTRODUCED SEPTEMBER 22, 2011

 


 

Sponsored by:

Senator  BOB SMITH

District 17 (Middlesex and Somerset)

Senator  RONALD L. RICE

District 28 (Essex)

 

Co-Sponsored by:

Senators Van Drew and Weinberg

 

 

 

 

SYNOPSIS

     "Telecommunications-Cable Television Deregulation Ensuring Consumer Protection Act”; revises State regulation of competitive services provided by telecommunications and cable television companies.

 

CURRENT VERSION OF TEXT

     As introduced.

  


An Act concerning the regulation of telecommunications and cable television companies, designated as the "Telecommunications-Cable Television Deregulation Ensuring Consumer Protection Act," and revising various parts of the statutory law.

 

     Be It Enacted by the Senate and General Assembly of the State of New Jersey:

 

     1.    Section 4 of P.L.1991, c.428 (C.48:2-21.19) is amended to read as follows:

     4.    a. Notwithstanding the provisions of R.S.48:2-18, R.S.48:2-21, section 31 of P.L.1962, c.198 (C.48:2-21.2), R.S.48:3-1, or any other law to the contrary, the board shall not regulate, fix or prescribe the rates, tolls, charges, rate structures, [terms and conditions of service,] rate base, rate of return, and cost of service, of competitive services.  The board [may] shall require the local exchange telecommunications company or interexchange telecommunications carrier to file and maintain tariffs for competitive telecommunications services.

     b.    The board is authorized to determine, after notice and hearing, whether a telecommunications service is a competitive service.  In making such a determination, the board shall develop standards of competitive service which, at a minimum, shall include evidence of ease of market entry; presence of other competitors; and the availability of like or substitute services in the relevant geographic area.

     c.     The board may determine, by rule, order, or in accordance with the provisions of a plan filed pursuant to subsection a. of section 3 of [this act] P.L.1991, c.428 (C.48:2-21.18), what reports are necessary to monitor the competitiveness of any telecommunications service.

     d.    The board shall have the authority to reclassify any telecommunications service that it has previously found to be competitive if, after notice and hearing, it determines that sufficient competition is no longer present, upon application of the criteria set forth in subsection b. of this section.  Upon such a reclassification, subsection a. of this section shall no longer apply and the board may determine such rates for that telecommunications service which it finds to be just and reasonable.  The board, however, shall continue to monitor the telecommunications service and, whenever the board shall find that the telecommunications service has again become sufficiently competitive pursuant to subsection b. of this section, the board shall again apply the provisions of subsection a. of this section.

     e.     Notwithstanding the provisions of subsection a. of this section, the following safeguards shall apply to the offering of any competitive service by a local exchange telecommunications company:

     (1)   the local exchange telecommunications company shall unbundle each noncompetitive service which is incorporated in the competitive service and shall make all such noncompetitive services separately available to any customer under tariffed terms and conditions, including price, that are identical to those used by the local exchange telecommunications company in providing its competitive service;

     (2)   the rate which a local exchange telecommunications company charges for a competitive service shall exceed the rates charged to others for any noncompetitive services used by the local exchange telecommunications company to provide the competitive service;

     (3)   tariffs for competitive services filed with the board shall either be in the public records, or, if the board determines that the rates are proprietary, shall be filed under seal and made available under the terms of an appropriate protective agreement, such as those used in cases before the board; and 

     (4)   nothing in [this act] P.L.1991, c.428 (C.48:2-21.16 et seq.) shall limit the authority of the board, pursuant to R.S.48:3-1, to ensure that local exchange telecommunications companies do not make or impose unjust preferences, discriminations, or classifications for noncompetitive and competitive services.

     f.     Notwithstanding the provisions of subsection a. of this section, nothing in P.L.1991, c.428 (C.48:2-21.16 et seq.) shall limit the board’s authority to review terms and conditions to ensure that telecommunications carriers subject to Article 2 of Chapter 2 and Chapter 17 of Title 48 of the Revised Statutes, provide safe, adequate, and proper service, including oversight on service quality and outages; and satisfy requirements under the federal “Communications Act of 1934,” 48 Stat. 1064 (47 U.S.C. s.151 et seq.), including, but not limited to, provisions regarding customer proprietary network information, illegal changes in subscriber carrier selections, and truth-in-billing.

g.   Notwithstanding the provisions of subsection b. of this section, the board shall retain the right to regulate protected telephone services for residential and single-line business customers until, after notice and hearing, the board determines that the level of competition is sufficient to ensure affordable rates for these services and that lower priced services are available to consumers.

h.   Regardless of whether it is regulated or deemed competitive service, the carrier of last resort, or “COLR,” obligations for protected telephone services shall remain in full force and effect for all incumbent local exchange carriers, or “ILECs.”  After notice and hearing, the board shall have the ability to identify another carrier as the COLR in the given service area of any ILEC.

(cf: P.L.1991, c.428, s.4)

 

     2.    R.S.48:2-23 is amended to read as follows:

     48:2-23.  The board may, after public hearing, upon notice, by order in writing, require any public utility to furnish safe, adequate and proper service, including furnishing and performance of service in a manner that tends to conserve and preserve the quality of the environment and prevent the pollution of the waters, land and air of this State, and including furnishing and performance of service in a manner which preserves and protects the water quality of a public water supply, and to maintain its property and equipment in such condition as to enable it to do so.

     The board may, pending any such proceeding, require any public utility to continue to furnish service and to maintain its property and equipment in such condition as to enable it to do so.

     The board, in requiring any public water utility to furnish safe, adequate and proper service, may require the public water utility to retain in its rate base any property which the board determines is necessary to protect the water quality of a public water supply.

     The board, in requiring any telecommunications carrier to furnish safe, adequate, and proper service, shall retain the authority to take all actions necessary regulating terms and conditions of service on any services whether regulated or competitive to ensure telecommunications carriers continue to provide safe, adequate, and proper service.

     The board, subject to public notice, shall conduct a bi-annual review of its telecommunications services regulations to determine whether any of its regulations are no longer needed to provide safe, adequate, and proper service and to protect consumer interests.  In making any determination to reduce regulation, the board shall conduct a cost-benefit analysis of the regulation, including whether the removal of these regulations will result in lower rates for customers.

(cf: P.L.1988, c.163, s.5)

 

     3.    Section 1 of P.L.1984, c.2 (C.48:2-51.1) is amended to read as follows:

     1.    a. Except as otherwise provided by subsection b. of this section, no person shall acquire or seek to acquire control of a public utility directly or indirectly through the medium of an affiliated or parent corporation or organization, or through the purchase of shares, the election of a board of directors, the acquisition of proxies to vote for the election of directors, or through any other manner, without requesting and receiving the written approval of the Board of Public Utilities.  Any agreement reached, or any other action taken, in violation of this [act] section shall be void.  In considering a request for approval of an acquisition of control, the board shall evaluate the impact of the acquisition on competition, on the rates of ratepayers affected by the acquisition of control, on the employees of the affected public utility or utilities, and on the provision of safe and adequate utility service at just and reasonable rates.  The board shall accompany its decision on a request for approval of an acquisition of control with a written report detailing the basis for its decision, including findings of fact and conclusions of law.

     b.    Nothing herein shall require the review or approval by the board of any parent or affiliate corporation of a telecommunications company if such parent or affiliate corporation does not itself provide regulated telecommunications service or telephone access line service, in this State, and seeks to combine, merge, or consolidate with, or acquire or acquire control of, another corporation or other organization which:

     (1)   does not directly provide regulated telecommunications services or telephone access line service, in this State; and

     (2)   does not directly or through one or more affiliates, own a controlling interest in another corporation or other organization which provides regulated telecommunications service or telephone access line service, in this State.

     c.     The board shall retain jurisdiction to approve any transfers of control of any telecommunications carrier regardless of whether the telecommunications carrier provides regulated or competitive services.

(cf: P.L.2008, c.87, s.1)

 

     4.    Section 1 of P.L.1968, c.173 (C.48:2-59) is amended to read as follows:

     1.    To enable the Board of Public [Utility Commissioners in the Department of Public] Utilities to better perform its lawful duties relating to service, classifications to be used, rates and charges to be made and collected, rules and regulations to be prescribed, and supervision over all public utilities and public movers under its jurisdiction, the Board of Public [Utility Commissioners] Utilities shall annually make an assessment against each public utility and public mover.

   Notwithstanding any other provisions of P.L.    , c.   (C.        ) (pending before the Legislature as this bill), the board shall retain its assessment authority over all telecommunications carriers even if services offered by the telecommunications carrier have been declared competitive in order to continue to ensure safe, adequate, and proper services for customers.

(cf: P.L.1972, c.36, s.1)

 

     5.    R.S.48:3-1 is amended to read as follows:

     48:3-1.  No public utility shall:

     a.     Make, impose or exact any unjust or unreasonable, unjustly discriminatory or unduly preferential individual or joint rate, commutation rate, mileage and other special rate, toll, fare, charge or schedule for any product or service supplied or rendered by it within this state; or

     b.    Adopt or impose any unjust or unreasonable classification in the making  or as the basis of any individual or joint rate, toll, fare, charge or schedule  for any product or service rendered by it within this state.

     c.     Subject to the provisions of subsection b. of this section, for all services offered by a telecommunications carrier including competitive services, the board shall retain the authority to ensure consumer protections consistent with the provisions of this section including, but not limited to, the board’s authority to implement and enforce any telephone relay service or enhanced 9-1-1 funding or operational requirements.

     The word "board" as used in this chapter shall mean the [board of public utility commissioners] Board of Public Utilities.

(cf: R.S.48:3-1)

 

     6.    R.S.48:3-2 is amended to read as follows:

     48:3-2. No public utility shall adopt, maintain or enforce any [regulation,] practice or measurement which shall be unjust, unreasonable, unduly preferential, arbitrarily or unjustly discriminatory or otherwise in violation of law.

(cf: R.S.48:3-2)

 

     7.    Section 1 of P.L.1987, c.211 (C.48:3-2.1) is amended to read as follows:

     1.    A public utility shall pay or credit interest at a rate prescribed by the Board of Public Utilities on any overpayment made by a residential customer due to a billing error, unless the overpayment is fully refunded or credited to the customer's account within two billing cycles after written notification by the customer to the utility of the alleged error.  For the purposes of this act, "billing error" means a charge to a residential customer in excess of that approved by the board for the type of service supplied to that customer, or in excess of the charge due for the service supplied to that customer as measured or recorded by meter or other device, except that neither the amount of an estimated bill in and of itself, nor the amount due on a budget account installment, shall constitute a billing error.  The board shall set and from time to time revise the interest rate in accordance with appropriate prevailing marketplace interest rates.

     This requirement shall apply to telecommunications carriers regardless of whether they offer regulated or competitive services.

(cf: P.L.1987, c.211, s.1)


     8.    R.S.48:3-3 is amended to read as follows:

     48:3-3.  a.  No public utility shall provide or maintain any service that is unsafe, improper or inadequate, or withhold or refuse any service which reasonably can be demanded or furnished when ordered by the board.

     b.    The board, upon receipt of a notification of refusal to provide solid waste collection services within a municipality pursuant to section 2 of P.L.1991, c.170 (C.40:66-5.2), may order the solid waste collector to provide these services in accordance with the provisions of R.S.48:2-23.

     c.     The provisions of subsection a. of this section shall apply to telecommunications service carriers that offer competitive services.

     d.    Telecommunications service carriers that offer regulated or competitive services shall allow at least 15 days after the bill’s postmark payment due date to allow payment of charges.  Notice to any customer of the carrier’s intention to discontinue service to that customer due to nonpayment of telephone service charges shall be made via certified mail, return receipt requested.  A telecommunications service carrier shall not discontinue service to a customer for nonpayment of charges until 10 days after having received the signed or postmarked certified mail return receipt.

(cf: P.L.1991, c.170, s.5)

 

     9.    Section 45 of P.L.1962, c.198 (C.48:3-3.1) is amended to read as follows:

     45.  No public utility shall refuse to furnish or supply service to or for any building or premises by reason of a bill remaining unpaid by a previous occupant, providing the person applying for service shall not be in arrears to such company for service previously furnished to or for such building or premises or furnished to or for any other building or premises.

   The provisions of this section shall apply to telecommunications service carriers that offer competitive services.

(cf: P.L.1962, c.198, s.45)

 

     10.  R.S.48:3-7 is amended to read as follows:

     R.S.48:3-7. a. Except as otherwise provided by subsection g. of this section, no public utility shall, without the approval of the board, sell, lease, mortgage, or otherwise dispose of or encumber its property, franchises, privileges, or rights, or any part thereof; or merge or consolidate its property, franchises, privileges, or rights, or any part thereof, with that of any other public utility.

     Where, by the proposed sale, lease, or other disposition of all or a substantial portion of its property, any franchise or franchises, privileges, or rights, or any part thereof or merger or consolidation thereof as set forth herein, it appears that the public utility or a wholly owned subsidiary thereof may be unable to fulfill its obligation to any employees thereof with respect to pension benefits previously enjoyed, whether vested or contingent, the board shall not grant its approval unless the public utility seeking the board's approval for such sale, lease, or other disposition assumes such responsibility as will be sufficient to provide that all such obligations to employees will be satisfied as they become due.

     Every sale, mortgage, lease, disposition, encumbrance, merger, or consolidation made in violation of this section shall be void.

     Nothing herein shall prevent the sale, lease, or other disposition by any public utility of any of its property in the ordinary course of business, nor require the approval of the board to any grant, conveyance, or release of any property or interest therein heretofore made or hereafter to be made by any public utility to the United States, State or any county or municipality or any agency, authority, or subdivision thereof, for public use.

     The approval of the board shall not be required to validate the title of the United States, State, or any county or municipality or any agency, authority, or subdivision thereof, to any lands or interest therein heretofore condemned or hereafter to be condemned by the United States, State, or any county or municipality or any agency, authority or subdivision thereof for public use.

     b.    Notwithstanding any law, rule, regulation, or order to the contrary, an autobus public utility regulated by and subject to the provisions of Title 48 of the Revised Statutes may, without the approval of the Department of Transportation, sell, lease, mortgage, or otherwise dispose of or encumber its property, or any part thereof, except that approval of the Department of Transportation shall be required for the following:

     (1)   the sale of 60% or more of its property within a 12-month period;

     (2)   a merger or consolidation of its property, franchises, privileges, or rights; or

     (3)   the sale of any of its franchises, privileges or rights.

     Notice of the sale, purchase or lease of any autobus or other vehicle subject to regulation under Title 48 of the Revised Statutes shall be provided to the Department of Transportation as the department shall require.

     c.     Except as otherwise provided in subsection e. of this section, no solid waste collector as defined in section 3 of P.L.1970, c.40 (C.48:13A-3) shall, without the approval of the Department of Environmental Protection:

     (1)   sell, lease, mortgage, or otherwise dispose of or encumber its property, including customer lists; or

     (2)   merge or consolidate its property, including customer lists, with that of any other person or business concern, whether or not that person or business concern is engaged in the business of solid waste collection or solid waste disposal pursuant to the provisions of P.L.1970 c.39 (C.13:1E-1 et seq.), P.L.1970, c.40 (C.48:13A-1 et al.), P.L.1991, c.381 (C.48:13A-7.1 et al.) or any other act.

     d.    Any solid waste collector seeking approval for any transaction enumerated in subsection c. of this section shall file with the department, on forms and in a manner prescribed by the department, a notice of intent at least 30 days prior to the completion of the transaction.

     (1)   The department shall promptly review all notices filed pursuant to this subsection.  The department may, within 30 days of receipt of a notice of intent, request that the solid waste collector submit additional information to assist in its review if it deems that such information is necessary.  If no such request is made, the transaction shall be deemed to have been approved.  In the event that additional information is requested, the department shall outline, in writing, why it deems such information necessary to make an informed decision on the impact of the transaction on effective competition.

     (2)   The department shall approve or deny a transaction within 60 days of receipt of all requested information.  In the event that the department fails to take action on a transaction within the 60-day period specified herein, then the transaction shall be deemed to have been approved.

     (3)   The department shall approve a transaction unless it makes a determination pursuant to the provisions of section 19 of P.L.1991, c.381 (C.48:13A-7.19) that the proposed sale, lease, mortgage, disposition, encumbrance, merger, or consolidation would result in a lack of effective competition.

     The department shall prescribe and provide upon request all necessary forms for the implementation of the notification requirements of this subsection.

     e.     (1) Any solid waste collector may, without the approval of the department, purchase, finance, or lease any equipment, including collection or haulage vehicles.

     (2)   Any solid waste collector may, without the approval of the department, sell or otherwise dispose of its collection or haulage vehicles; except that no solid waste collector shall, without the approval of the department in the manner provided in subsection d. of this section, sell or dispose of 33% or more of its collection or haulage vehicles within a 12-month period.

     f.     (1) The owner or operator of a privately-owned sanitary landfill facility may, without the approval of the Department of Environmental Protection, sell or otherwise dispose of its assets except that the prior approval of the department shall be required: (a) to sell all assets associated with the sanitary landfill facility or a portion thereof sufficient to transfer the operation of the sanitary landfill facility to a new owner or operator; (b) to sell a controlling ownership interest in the sanitary landfill facility; or (c) to merge or consolidate its property with that of any other person or business concern, whether or not that person or business concern is engaged in the business of solid waste disposal pursuant to the provisions of P.L.1970, c.39 (C.13:1E-1 et seq.), P.L.1970, c.40 (C.48:13A-1 et al.) or any other act.

     (2)   Any owner or operator seeking approval for any transaction enumerated in this subsection shall file with the department an application therefor, on forms and in a manner prescribed by the department.  The department shall promptly review all applications filed pursuant to this subsection and shall serve requests for information regarding any transaction within 30 days following the filing of an application if the department deems that such information is necessary.  The department shall approve or deny the transaction within 60 days of receipt of all requested information.  In the event that the department fails to take action on a transaction within the 60-day period specified herein, then the transaction shall be deemed to have been approved.

     As used in this section, "business concern" means any corporation, association, firm, partnership, sole proprietorship, trust, or other form of commercial organization; and "privately-owned sanitary landfill facility" means a commercial sanitary landfill facility which is owned and operated by a private person, corporation, or other organization and includes all appurtenances and related improvements used at the site for the transfer, processing, or disposal of solid waste.

     g.     Nothing herein shall require the review or approval by the board of any parent or affiliate corporation of a telecommunications company if such parent or affiliate corporation does not itself provide regulated telecommunications service or the provision of telephone access line service, in this State, and such parent or affiliate corporation seeks to sell, lease, mortgage, or otherwise to dispose of or to permit the encumbrance of any of its property, franchises, privileges or rights, or any part thereof; or to merge, or consolidate its property, franchises, privileges or rights, or any part thereof, with that or those of another corporation or other organization which:

     (1)   does not directly provide regulated telecommunications services or telephone access line service, in this State; and

     (2)   does not directly or through one or more affiliates, own a controlling interest in another corporation or other organization which provides regulated telecommunications service or telephone access line service, in this State.

     h.     The provisions of this section shall not be applicable to incumbent local exchange carriers that are publicly traded companies and such carriers no longer need to seek approval to sell, lease, mortgage and encumbered real property.

(cf: P.L.2008, c.87, s.2)

 

     11.  R.S.48:3-7.1 is amended to read as follows:

     R.S.48:3-7.1.  No management, advisory service, construction or engineering contract that in itself or in connection with another contract relating to the same work, project, transaction or service involves the expenditure of a sum exceeding twenty-five thousand dollars, made by any public utility with any person or corporation owning, holding or controlling separately, or in affiliation with another person or corporation, five per cent or more of the capital stock of such public utility or with any corporation five per cent of the capital stock of which is owned, held or controlled by a person or corporation owning, holding or controlling separately, or in affiliation with another person or corporation, five per cent of the capital stock of such public utility shall be valid or effective until approved in writing by the board.

     The board shall disapprove such contract if it determines that such contract violates the laws of this state or of the United States, or that the price or compensation thereby fixed exceeds the fair price or fair compensation for the property to be furnished or the work to be done or the services to be rendered thereunder or is contrary to the public interest: otherwise the board shall approve such contract.

     No order shall be made by the board disapproving such a contract except after hearing upon notice.

     The provisions of this section shall not apply to incumbent local exchange carriers that are publicly traded companies.

(cf: R.S.48:3-7.1)

 

     12.  R.S.48:3-7.2 is amended to read as follows:

     R.S.48:3-7.2. Except with the approval in writing of the board first had and obtained, no  public utility shall loan any of its money or property to any other person,  firm, group, association, company, trust or corporation owning, holding or  controlling separately or in affiliation with others, five per cent or more of  the capital stock of any such public utility or to any corporation five per  cent or more of the capital stock of which is owned, held or controlled by any  person, firm, group, association, trust, or corporation owning, holding or  controlling separately or in affiliation, five per cent or more of the capital  stock of such public utility.

     The provisions of this section shall not apply to incumbent local exchange carriers that are publicly traded companies.

(cf: R.S.48:3-7.2)

 

     13.  R.S.48:3-7.3 is amended to read as follows:

     R.S.48:3-7.3.  No public utility shall, without the approval in writing of the board first  had and obtained, invest any part of its depreciation fund in obligations or  securities of any kind, except obligations and securities that are legal  investments for savings banks under the laws of this state, and except  obligations and securities of the underlying or subsidiary public utility  corporations of this state, of such public utility.

     The provisions of this section shall not apply to incumbent local exchange carriers that are publicly traded companies.

(cf: R.S.48:3-7.3)

 

     14.  R.S.48:3-7.4 is amended to read as follows:

     R.S.48:3-7.4. Every public utility shall at all times keep within this state all obligations and securities in which its depreciation fund is invested and reinvested.

     The provisions of this section shall not apply to incumbent local exchange carriers that are publicly traded companies.

(cf: R.S.48:3-7.4)

 

     15.  R.S.48:3-7.5 is amended to read as follows:

     R.S.48:3-7.5. The board may after hearing upon notice order any public utility to dispose  of any obligations or securities in which its depreciation fund is now, or may  hereafter be, invested, except obligations and securities that are legal  investments for savings banks under the laws of this state, and except  obligations and securities of underlying or subsidiary public utility corporations of this state, of such public utility.

     The provisions of this section shall not apply to incumbent local exchange carriers that are publicly traded companies.

(cf: R.S.48:3-7.5)

 

     16.  R.S.48:3-7.6 is amended to read as follows:

     R.S.48:3-7.6. Every public utility shall deposit, and at all times keep deposited in its own name and to its own credit and in a banking or trust company located in this state, the balance of the depreciation fund of such public utility which is not invested in accordance herewith or expended in accordance with [section] R.S.48:2-18 [of this title].  This provision shall apply to every depreciation fund [whether accumulated before or after March twelfth, one thousand nine hundred and thirty-five].

     The provisions of this section shall not apply to incumbent local exchange carriers that are publicly traded companies.

(cf: R.S.48:3-7.6)

 

     17.  R.S.48:3-9 is amended to read as follows:

     R.S.48:3-9.  a. Except as otherwise provided by subsection b. of this section, no public utility shall, unless it shall have first obtained authority from the board so to do:

     (1)   Issue any stocks, or any bonds, notes, or other evidence of indebtedness payable more than 12 months after the date or dates thereof, or extend or renew any bond, note, or any other evidence of indebtedness so that any extension or renewal thereof shall be payable later than 12 months after the date of the original instrument; or

     (2)   Permit any demand note to remain unpaid for a period of more than 12 months after the date thereof.

     The board shall approve any such proposed issue, with or without hearing at its discretion, when satisfied that such issue is to be made in accordance with law and the purpose thereof is approved by the board.

     The provisions of this subsection shall not apply to any public utility operating, managing, or controlling a railroad or a railway express which is subject to the rules and regulations from time to time issued by the federal Surface Transportation Board or any successor agency.

     The provisions of this subsection shall not apply to autobus public utilities under the jurisdiction of the Department of Transportation.

     The provisions of this subsection shall not apply to any solid waste collector as defined in section 3 of P.L.1970, c.40 (C.48:13A-3).

     The provisions of this subsection shall not apply to any privately-owned sanitary landfill facility as defined in section 3 of P.L.2003, c.169 (C.48:13A-7.26).

     b.    Nothing herein shall require the review or approval by the board of any parent or affiliate corporation of a telecommunications company if such parent or affiliate corporation seeks to issue any stocks, bonds, notes, or other evidence of indebtedness payable more than 12 months after the date or dates thereof, or to extend or renew any bond, note, or other evidence of indebtedness so that any extension or renewal thereof shall be payable later than 12 months after the date of the original instrument, or to permit any demand note to remain unpaid for a period of more than 12 months after the date thereof, if the parent or affiliate corporation of the telecommunications company which seeks to engage in any of the aforementioned transactions does not itself provide regulated telecommunications services over a telecommunications network or telephone access line service, but does directly or through one or more affiliates own a controlling interest in a telecommunications network or does otherwise control or exercise responsibility for, through any arrangement, the management and operation of such a telecommunications network, or owns a controlling interest in a telecommunications company that provides regulated telecommunications service or telephone access line service.

     The provisions of this section shall not apply to incumbent local exchange carriers that are publicly traded companies.

(cf: P.L.2008, c.87, s.3)

 

     18.  R.S.48:3-10 is amended to read as follows:

     R.S.48:3-10.  a. Except as otherwise provided by subsection b. of this section, no public utility incorporated under the laws of this State shall sell, nor shall any such public utility make or permit to be made upon its books any transfer of any share or shares of its capital stock, to any other public utility, unless authorized to do so by the board.  Nor shall any public utility incorporated under the laws of this State sell any share or shares of its capital stock or make or permit any transfer thereof to be made upon its books, to any corporation, domestic or foreign, or any person, the result of which sale or transfer in itself or in connection with other previous sales or transfers shall be to vest in such corporation or person a majority in interest of the outstanding capital stock of such public utility corporation unless authorized to do so by the board.

     Every assignment, transfer, contract, or agreement for assignment or transfer, by or through any person or corporation to any corporation or person in violation of any of the provisions hereof shall be void and of no effect, and no such transfer shall be made on the books of any public utility corporation.  Nothing herein contained shall be construed to prevent the holding of stock lawfully acquired before March 5, 1935.

     Where, by the proposed assignment, transfer, contract, or agreement for assignment or transfer of capital stock as set forth herein, it appears that the public utility or a wholly owned subsidiary thereof may be unable to fulfill its obligation to any employees thereof with respect to pension benefits previously enjoyed, whether vested or contingent, the board shall not grant its authorization unless the public utility seeking the board's authorization assumes such responsibility as will be sufficient to provide that all such obligations to employees will be satisfied as they become due.

     Nothing herein shall require the approval of the Department of Transportation to any sale or transfer by any public utility of any share or shares of its capital stock to the New Jersey Transit Corporation or any subsidiary thereof for public use.

     b.    Nothing herein shall require the review and approval by the board of any parent or affiliate corporation of a telecommunications company if such parent or affiliate corporation seeks to sell, or to make or permit to be made upon its books any transfer of any share or shares of its capital stock, to any other public utility, if the telecommunications company which seeks to engage in any of the aforementioned transactions does not itself provide regulated telecommunications services over a telecommunications network or telephone access line service, but does directly or through one or more affiliates own a controlling interest in such a telecommunications network or does otherwise control or exercise responsibility for, through any arrangement, the management and operation of such a telecommunications network, or owns a controlling interest in a telecommunications company that provides regulated telecommunications service or telephone access line service.

     The provisions of this section shall not apply to incumbent local exchange carriers, or “ILECs,” that are publicly traded companies, unless the transaction effectuates a transfer of control of the ILEC, in which case the transaction shall be reviewed pursuant to the provisions of section 1 of P.L.1984, c.2 (C.48:2-51.1) and R.S.48:3-7.

(cf: P.L.2008, c.87, s.4)

 

     19.  Section 9 of P.L.1972, c.186 (C.48:5A-9) is amended to read as follows:

     9.    The board, which is empowered pursuant to P.L.1972, c.186 (C.48:5A-1 et seq.) to be the local franchising authority in this State, and the director under the supervision of the board, shall have full right, power, authority and jurisdiction to:

     a.     Receive or initiate complaints of the alleged violation of any of the provisions of P.L.1972, c.186 (C.48:5A-1 et seq.) or of any of the rules and regulations made pursuant to P.L.1972, c.186 (C.48:5A-1 et seq.) or of the terms and conditions of any municipal consent or franchise granted pursuant to P.L.1972, c.186 (C.48:5A-1 et seq.); and for this purpose and all other purposes necessary to enable the director to administer the duties of the office as prescribed by law may hold hearings and shall have power to subpoena witnesses and compel their attendance, administer oaths and require the production for examination of any books or papers relating to any matter under investigation at any such hearing;

     b.    Supervise and regulate every CATV company operating within this State and its property, property rights, equipment, facilities, contracts, certificates and franchises so far as may be necessary to carry out the purposes of P.L.1972, c.186 (C.48:5A-1 et seq.), and to do all things, whether herein specifically designated or in addition thereto, which are necessary or convenient in the exercise of such power and jurisdiction;

     c.     Institute all proceedings and investigations, hear all complaints, issue all process and orders, and render all decisions necessary to enforce the provisions of P.L.1972, c.186 (C.48:5A-1 et seq.), of the rules and regulations adopted thereunder, or of any municipal consents issued pursuant to P.L.1972, c.186 (C.48:5A-1 et seq.);

     d.    Institute, or intervene as a party in, any action in any court of competent jurisdiction seeking mandamus, injunctive or other relief to compel compliance with any provision of P.L.1972, c.186 (C.48:5A-1 et seq.), of any rule, regulation or order adopted thereunder or of any municipal consent or franchise issued thereunder, or to restrain or otherwise prevent or prohibit any illegal or unauthorized conduct in connection therewith.

e.   Notwithstanding any determination that effective competition exists pursuant to Pub.L.98-549 (47 U.S.C. s.543), the board shall retain the ability to ensure safe, proper, and adequate service including, but not limited to, regulating terms and conditions to ensure that a CATV company provides safe, proper, and adequate service consistent with federal law, including oversight on service quality and outages.

f.    Subject to notice, the board, shall conduct a bi-annual review of its cable regulations to determine whether any of its regulations are no longer needed to provide safe, adequate, and proper service and to protect consumer interests.  In making any determination to reduce regulation, the board shall conduct a cost-benefit analysis of the regulation, including whether the removal of its regulations will result in lower rates for consumers.

(cf: P.L.2006, c.83, s.6)

 

     20.  Section 17 of P.L.1972, c.186 (C.48:5A-17) is amended to read as follows:

     17.  a. The board shall issue a certificate of approval or a system-wide franchise, as appropriate, when, after reviewing the application, and after the required meeting and hearings have been held pursuant to section 16 of P.L.1972, c.186 (C.48:5A-16), the applicant establishes to the board's satisfaction that the applicant has all the municipal consents necessary to support the application, if such consents are required, and that such consents and the issuance thereof are in conformity with the requirements of P.L.1972, c.186 (C.48:5A-1 et seq.), and that the applicant has complied or is ready, willing and able to comply with all applicable rules and regulations imposed by or pursuant to State or federal law as preconditions for engaging in the applicant's proposed CATV operations; provided, that in the case of any application for a certificate of approval which has omitted the attachment of municipal consent in the circumstance provided for in subsection a. of section 16 of P.L.1972, c.186 (C.48:5A-16), the board shall condition the issuance of the certificate upon the applicant's reasonably prompt attainment of the omitted municipal consent or reasonably prompt initiation of proceedings under subsection d. of this section.

     b.    In considering any application for a certificate of approval, the board shall take into consideration the probable effects upon both the area for which certification is sought and neighboring areas not covered in the municipal consents; and if it finds that the probable effects, for technical and financial reasons, would be to impede the development of adequate cable service, or create an unreasonable duplication of services likely to be detrimental to the development of adequate cable service in any area either within or without the area for which certification is sought, it may deny the certificate or it may amend the certificate in issuing it so as to:

     (1)   Direct that areas covered in the application be excluded from the area certified; or

     (2)   Direct that areas not covered in the application be included in the area certified.

     c.     No such certificate of approval amended pursuant to subsection b. of this section shall be issued except after hearing of which each affected municipality shall be given notice and afforded opportunity to be heard.  No such amended certificate of approval shall be issued which would impair the terms of any existing certificate of approval or of any municipal consent upon which such existing certificate is based, except with the consent of the holder of such existing certificate and of any municipality having issued such municipal consent.

     d.    If a municipality shall arbitrarily refuse to grant the municipal consent required under the terms of P.L.1972, c.186 (C.48:5A-1 et seq.) prerequisite to issuance of a certificate, or to act upon an application for such municipal consent within 90 days after such application is filed, then the applicant may avoid the necessity of first obtaining such municipal consent by showing to the satisfaction of the board that the municipal consent is being arbitrarily withheld.  But any CATV company certificated without municipal consent shall nevertheless pay the franchise tax to the municipality imposed under section 30 of P.L.1972, c.186 (C.48:5A-30).  An application for certificate filed pursuant to this subsection shall be accompanied by a filing fee of $1,000.

     e.     If any municipality or county shall refuse to any CATV company, whether the holder of a municipal consent from that municipality or otherwise, any zoning variance or other municipal act or authorization, or any county act or authorization, necessary to permit such CATV company to locate any facility of such CATV company within such municipality or county, or to install transmission facilities through such municipality or county for the purpose of serving subscribers or customers in any area for which such CATV company has been issued a certificate or system-wide franchise by the board, the CATV company may apply to the board for an order setting aside such municipal or county refusal and permitting such location of facility or installation of transmission facilities as requested by the CATV company.  An application pursuant to this subsection shall be accompanied by a filing fee of $500.  The board, after hearing upon notice and full opportunity for both the applicant and the municipality or county to be heard, shall issue such order when it appears to the board's satisfaction that such permission is necessary to enable the CATV company to provide safe, adequate and proper CATV service to its customers or subscribers in the manner required by P.L.1972, c.186 (C.48:5A-1 et seq.) and that such location or installation will not adversely affect the public health, safety and welfare.

     f.     The director shall issue a certificate of approval to any CATV company lawfully engaged in the construction, extension or operation of a CATV system within the boundaries of the municipality cited in the application, for the construction, extension or operation then being conducted within such municipality, without further review, if application for such certificate is filed with the board within 90 days after such effective date.  The construction, extension or operation of such a CATV system may be lawfully continued pending the filing of such an application unless the director orders otherwise.  An application for such certificate which is untimely shall be determined in accordance with the procedures prescribed in subsections a. through d. of this section.  A certificate of approval issued under this subsection shall expire five years from the date of issuance; and no CATV company holding such certificate shall be authorized to continue its operations after such expiration unless prior thereto it shall have obtained a certificate of approval under the procedures specified in subsections a. through d. of this section, except that such a CATV company which has initiated proceedings for certification under subsections a. through d. of this section prior to the expiration of a certificate of approval granted under this subsection may continue its operations pending the final disposition of such proceedings.  An application pursuant to this subsection shall be accompanied by a filing fee of $50.

     g.     Notwithstanding the provisions of this section and any determination that effective competition exists pursuant to Pub.L.98-549 (47 U.S.C. s.543), the board shall retain the authority to ensure safe, adequate, and proper service, including regulating terms and conditions to ensure that a CATV company provides safe, proper, and adequate service consistent with federal law including, but not limited to, oversight on service quality and outages.

(cf: P.L.2006, c.83, s.13)

 

     21.  Section 19 of P.L.1972, c.186 (C.48:5A-19) is amended to read as follows:

     19.  a.  A certificate of approval issued by the board shall be nontransferable, except by consent of the board and shall specify the area to which it applies and the municipal consents upon which it is based.  A certificate of approval issued by the board shall be valid for 15 years from the date of issuance or 20 years from the date of issuance if the board certifies that a CATV company has implemented an open video system in accordance with [47 U.S.C. s.573] Pub.L.104-104 (47 U.S.C. s.573) within one year after receiving a municipal consent, or until the expiration, revocation, termination or renegotiation of any municipal consent upon which it is based, whichever is sooner.  But amendment of the terms of a municipal consent by mutual consent and in conformity with the procedures specified in P.L.1972, c.186 (C.48:5A-1 et seq.) during the term for which it was issued shall not require the issuance of a new certificate of approval.  A CATV company holding a certificate based upon a municipal consent with a provision for automatic renewal for a term not exceeding 10 years beyond its expiration date or 15 years beyond its expiration date if the board certifies that the CATV company has implemented an open video system in accordance with [47 U.S.C. s.573] Pub.L.104-104 (47 U.S.C. s.573), shall be entitled to automatic reissuance of a certificate for such term, unless it shall forfeit such entitlement by violation of any terms of P.L.1972, c.186 (C.48:5A-1 et seq.), regulations issued pursuant thereto, or by the terms of the municipal consent.

     b.    A system-wide franchise issued by the board shall be nontransferable, except by consent of the board, and shall specify the area to which it applies.  A system-wide franchise issued by the board shall be valid for seven years from the date of issuance.  A system-wide franchise issued pursuant to P.L.1972, c.186 (C.48:5A-1 et seq.) shall not require: (1) a CATV company to operate outside of the areas in which the CATV company either has plant or equipment in use for the provision of any consumer video, cable or telecommunications service, or has proposed to place into use such plant or equipment for the provision of such services; or (2) a CATV company with municipal consents issued prior to the effective date of P.L.2006, c.83 (C.48:5A-25.1 et al.) to operate outside of the areas covered by such consents.  Renewal of a system-wide franchise shall be valid for a period of seven years from the date of the renewal issuance, and the board shall establish rules governing the renewal of a system-wide franchise.

     c.     When issuing a renewal, the board shall issue a written order finding compliance with all State and federal standards and that the franchise renewal is in the public interest.

(cf: P.L.2006, c.83, s.15)

 

     22.  Section 28 of P.L.1972, c.186 (C.48:5A-28) is amended to read as follows:

     28.  Each application for a municipal consent or system-wide franchise shall contain:

     a.     A description of the initial area to be served.

     b.    A description of the proposed service in terms of the number of channels of cable television reception service.

     c.     Sufficient evidence that the applicant has the financial and technical capacity and the legal, character and other qualifications to construct, maintain and operate the necessary installations, lines and equipment and to provide the service proposed in a safe, adequate and proper manner.

     d.    Evidence of sufficient bond, or commitment therefor, with sureties to be approved by the office, in the penal sum of not less than $25,000 for the faithful performance of all undertakings by the applicant as represented in the application; the sufficiency of which shall be subject to review by the director and approval by the board.

     e.     An undertaking to hold the board and all municipalities served harmless from any liability arising out of the applicant's operation and construction of its CATV system.

     f.     Evidence of sufficient insurance insuring the board, all municipalities served and the applicant with respect to all liability for any death, personal injury, property damage or other liability arising out of the applicant's construction and operation of its CATV system; the sufficiency of which shall be subject to review by the director and approval by the board. Such insurance shall be no less than: (1) $150,000 for bodily injury or death to any one person, within the limit, however, of $500,000 for bodily injury or death resulting from any one accident, (2) $100,000 for property damage resulting from any one accident, and (3) $50,000 for all other types of liability; the sufficiency of which shall be subject to review by the director and approval by the board.

     g.     A schedule of proposed rates for cable television reception service, which rates shall not be altered during the term for which the municipal consent is issued, except by application to the board for amendment of the terms and conditions of said consent after public hearing, subject to the rules of the office, review by the director and approval by the board, or amendment pursuant to the provisions of subsection b. of section 11 of P.L.1972, c.186 (C.48:5A-11).

     h.     (1) With regard only to applications for a system-wide franchise, a commitment as to those municipalities that are served by a CATV company at the time of the application, to match or surpass any line extension policy operative at the time the system-wide franchise is granted and placed into effect prior to the enactment of P.L.2006, c.83 (C.48:5A-25.1 et al.) by a local franchise or certificate of approval, for the duration of the system-wide franchise.  In any event, the CATV company shall extend its plant along public rights-of-way to all residences and businesses within 150 aerial feet of the CATV company's existing plant at no cost beyond the normal installation rate, and to all residences and businesses within 100 underground feet of the CATV company's plant at no cost beyond the normal installation rate, and shall set a minimum house per mile density of not less than 35 homes per square mile.

     (2)   This commitment shall be in addition to any and all board orders and rules that impact upon the extension of plant, except that such commitment shall supersede the board's regulations adopted as N.J.A.C.14:3-8.1 et seq., which shall not apply to CATV companies, including telecommunications service providers that have obtained a system-wide franchise.

     i.      With regard only to applications for a system-wide franchise, a commitment to provide to each municipality that is served by a CATV company, with two public, educational and governmental access channels.  In the event that two or more access channels are requested by a municipality, the municipality shall demonstrate that its cable-related needs require the provision of such additional access channels.  Any and all CATV companies operating in a municipality shall provide interconnection to all other CATV companies on reasonable terms and conditions, and the board shall adopt regulations for procedures by which disputes between such CATV companies shall be determined and expeditiously resolved.  Each municipality or its non-profit designee shall assume responsibility for the management, operations and programming of the public, educational and governmental access channels.

     j.     With regard only to applications for a system-wide franchise, a commitment to install and retain or provide, without charge, one service outlet activated for basic service to any and all fire stations, public schools, police stations, public libraries, and other such buildings used for municipal purposes.

     k.    With regard only to applications for a system-wide franchise, a commitment to provide free Internet service, without charge, through one service outlet activated for basic service to any and all fire stations, public schools, police stations, public libraries, and other such buildings used for municipal purposes.

     l.      With regard only to applications for a system-wide franchise, a commitment to provide equipment and training for access users, without charge, on a schedule to be agreed upon between the municipality and the CATV company.

     m.    With regard only to applications for a system-wide franchise, a commitment to provide a return feed from any one location in the municipality, without charge, to the CATV company's headend or other location of interconnection to the cable television system for public, educational or governmental use, which return feed, at a minimum, provides the ability for the municipality to cablecast live or taped access programming, in real time, as may be applicable, to the CATV company's customers in the municipality.  No CATV company is responsible for providing a return access feed unless a municipality requests such a feed in writing.  A CATV company that has interconnected with another CATV company may require the second CATV company to pay for half of the CATV company's absorbed costs for extension.

     n.     With regard only to applications for a system-wide franchise, a commitment to meet any consumer protection requirements applicable, pursuant to board regulations, to cable television companies operating under certificates of approval.

     o.    Notwithstanding the provisions of this section and any determination that effective competition exists, the requirements set forth in subsections h., i., j., k., l., m., and n. of this section remain unaffected and the board shall retain the authority to ensure safe, adequate, and proper service, including regulating terms and conditions to ensure that a CATV company provides safe, proper, and adequate service including, but not limited to, oversight on service quality and outages.

(cf: P.L.2006, c.83, s.23)

 

     23.  Section 32 of P.L.1972, c.186 (C.48:5A-32) is amended to read as follows:

     32.  To enable the office to perform its lawful duties and responsibilities relating to the regulation of CATV companies, the director shall annually make an assessment against each CATV company, which shall be in lieu of all other fees and charges for the regulatory and supervisory functions of the office, except those fees imposed pursuant to sections 16, 17 and 18 of [ this act] P.L.1972, c.186 (C.48:5A-16 through 18).

     Notwithstanding any other provisions of P.L.1972, c.186 (C.48:5A-1 et seq.), the board retains its authority to issue assessments over all CATV companies even if services offered by the CATV company have been declared competitive, in order to ensure safe, adequate, and proper service for consumers.

(cf: P.L.1972, c.186, s.32)

 

     24.  Section 38 of P.L.1972, c.186 (C.48:5A-38) is amended to read as follows:

     38.  a. Except as otherwise provided by subsection b. of this section, no CATV company shall combine, merge, or consolidate with, or acquire control of, another organization without first obtaining the approval of the board, which shall be granted only after an investigation and finding that such proposed combination, merger, consolidation, or acquisition is in the public interest.

     b.    Nothing herein shall require the review or approval by the board of any parent or affiliate corporation of a company that provides cable television service over a cable television system if such parent or affiliate corporation does not itself provide cable television service in this State and seeks to combine, merge, or consolidate with, or to acquire control of, another corporation or other organization that:

     (1)   does not directly provide cable television service in this State; and

     (2)   does not directly or through one or more affiliates, own a controlling interest in another corporation or other organization that provides cable television service in this State.

     c.     Notwithstanding the provisions of subsection b. of this section, the board shall retain the authority to approve or deny any transfers of control for any CATV company regardless of whether the board regulates the CATV company’s rates.

(cf: P.L.2008, c.87, s.5)

 

     25.  Section 40 of P.L.1972, c.186 (C.48:5A-40) is amended to read as follows:

     40.  a. Except as otherwise provided by subsections b. and c. of this section, no CATV company shall, without the approval of the board, sell, lease, mortgage or otherwise dispose of or encumber its property, franchises, privileges or rights, or any part thereof; or merge or consolidate its property, franchises, privileges or rights, or any part thereof, with that of any other CATV company.  Every sale, mortgage, lease, disposition, encumbrance, merger or consolidation made in violation of this section shall be void.

     b.    Nothing herein shall prevent the sale, lease or other disposition by any CATV company of any of its property in the ordinary course of business, nor require the approval of the board to any grant, conveyance or release or any property or interest therein heretofore made or hereafter to be made by any CATV company to the United States, the State or any county or municipality or any agency, authority or subdivision thereof, for public use.  The approval of the board shall not be required to validate the title of the United States, the State or any county or municipality or any agency, authority or subdivision thereof, to any lands or interest therein heretofore condemned or hereafter to be condemned by the United States, the State or any county or municipality or any agency, authority or subdivision thereof for public use.

     c.     Nothing herein shall require the review or approval by the board of any parent or affiliate corporation of a company that provides cable television service over a cable television system if such parent or affiliate corporation does not itself provide cable television service in this State and seeks to sell, lease, mortgage, or otherwise to dispose of or to permit the encumbrance of any of its property, franchises, privileges, or rights, or any part thereof; or to merge or consolidate its property, franchises, privileges, or rights, or any part thereof, with that or those of another corporation or other organization which:

     (1)   does not directly provide cable television service in this State; and

     (2)   does not directly or through one or more affiliates own a controlling interest in another corporation or other organization which provides cable television service in this State.

     d.    The provisions of this section shall not apply to a CATV company that is a publicly traded company and is not required by law to seek board approval to sell, lease, mortgage and encumber real property.

(cf: P.L.2008, c.87, s.6)

 

     26.  Section 42 of P.L.1972, c.186 (C.48:5A-42) is amended to read as follows:

     42.  Except as otherwise provided by subsection c. of this section, no CATV company shall, unless it shall have first obtained authority from the board to do so:

     a.     Issue any stocks, bonds, notes or other evidence of indebtedness payable more than 12 months after the date or dates thereof, or extend or renew any bond, note or other evidence of indebtedness so that any extension or renewal thereof shall be payable later than 12 months after the date of the original instrument; or

     b.    Permit any demand note to remain unpaid for a period of more than 12 months after the date thereof.

     The board shall approve any such proposed issue, with or without hearing at its discretion, when satisfied that such issue is to be made in accordance with law and the purpose thereof is approved by the board.

     c.     Nothing herein shall require the review or approval by the board of any parent or affiliate corporation of a company that provides cable television service over a cable television system if such parent or affiliate corporation seeks to issue any stocks, bonds, notes, or other evidence of indebtedness payable more than 12 months after the date or dates thereof, or to extend or renew any bond, note, or other evidence of indebtedness so that any extension or renewal thereof shall be payable later than 12 months after the date of the original instrument, or to permit any demand note to remain unpaid for a period of more than 12 months after the date thereof, if the company which seeks to engage in any of the aforementioned transactions does not itself provide cable television service over a cable television system but does directly or through one or more affiliates own a controlling interest in such a cable television system or does otherwise control or exercise responsibility for, through any arrangement, the management and operation of such a cable television system.

     d.    The provisions of this section shall not apply to a CATV company that is a publicly traded company and is not required by law to seek board approval for the issuance of stock, bonds, and other indebtedness except when such issuance involves a transfer of control which is subject to the board’s jurisdiction.

(cf: P.L.2008, c.87, s.7)

 

     27.  This act shall take effect immediately.

 

 

STATEMENT

 

     This bill, designated as the "Telecommunications-Cable Television Deregulation Ensuring Consumer Protection Act,” will ensure that protected telephone service remains affordable and that telephone service “carrier of last resort” obligations remain in place. The bill will bring regulatory symmetry to telecommunications service carriers and cable television companies in New Jersey and will guarantee that the Board of Public Utilities (“board”) continues to ensure safe, adequate, and proper service to all telecommunications and cable consumers under reasonable terms and conditions, while removing unnecessary regulations and establishes procedures for on-going review of existing regulations on a bi-annual basis to determine which regulations are unnecessary to maintain safe, adequate, and proper service and would require the board to conduct a cost-benefits analysis in its determination of what regulations are no longer necessary or in the public interest.