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Telecom industry seeks reimbursement requirement when governments force utility relocations; cities push back
Summary
House Bill 661 would require government bodies to reimburse non-rate-regulated telecommunications companies for costs of relocating infrastructure in public rights of way. Supporters said the change would speed broadband deployment; municipal groups and cities opposed using taxpayer funds to pay private companies’ relocation costs.
Representative Ben Keithley presented House Bill 661 as a mechanism to reimburse telecommunications companies when government projects force relocation of their infrastructure. "Therefore, what the bill does is it requires a mechanism by which the government would have to reimburse those costs," Keithley told the committee.
Telecom industry representatives and business groups argued the bill would remove a barrier to expanding broadband, especially in rural areas. Noel Torpy of the Missouri Cable Telecommunications Association said companies already pay franchise fees and other charges but still incur relocation costs: "We're being told when to move and it's on our dime. And we feel like it should be on the cities, counties, and MoDOT's dime, not ours." Ray McCarty of Associated Industries of Missouri and Cade Tremaine of the Missouri Chamber also urged support, saying unanticipated relocation costs could be passed to consumers and slow network expansion.
Cities, municipal associations and municipal utilities strongly opposed the bill. Richard Sheets, executive director of the Missouri Municipal League, said the relocation costs ultimately fall to taxpayers: "When we hear the word city, we're really talking about the taxpayer your constituents that's who pays for this." Sheets warned that franchise fees are declining as cable transitions to broadband and that municipalities already invest tax dollars to expand broadband.
Officials including Eric Schrader, deputy director and chief engineer from MoDOT, described current practice along state highways: "Along the state's highways there's a utility corridor on the outside 6 feet where all utilities are allowed to use. They use that area free we do not charge for permits we do not collect rent. Only requirement is if we have to make adjustments to the roadway when they have to move that cost is born by them." Schrader also pointed to Missouri regulations that currently govern the compensation process.
Supporters said the measure would speed deployment by shifting unpredictable relocation costs to the public agency initiating the project. Opponents said that creates fiscal risk for cities, counties and the state, could increase litigation over valuation, and would shift costs to local taxpayers as franchise fees decline. Several committee members requested detailed fiscal figures and project-level examples before taking further action.
The committee kept the bill in hearing and took testimony from multiple stakeholders. No committee vote was recorded during the hearing.
