Pole Attachment Development (March 25, 2003)
FCC Requires Cost-Based Rates for Wireless Attachments

Date: Mar 25, 2003

For the first time ever, the FCC today ruled that utilities must charge cost-based rates for wireless attachments to distribution poles. Following the Supreme Court's decision in Gulf Power that attachments by wireless companies are subject to FCC jurisdiction, the issue remained unresolved as to the specific rate allowable for attachments of wireless base stations, antennas and related equipment. Utilities had hoped that the FCC would allow them to charge market-based rates, based on the strong market that exists for wireless attachment sites. Today's decision in Omnipoint Corp. v. PECO Energy Co. dashes that hope.

Today's decision also addresses the FCC's jurisdiction over attachments to transmission towers. Last year, the 11th Circuit Court of Appeals ruled that attachments of any type (including wireless) to transmission towers were not subject to FCC regulation. The court's decision, however, confusingly referred interchangeably both to transmission towers in general and to "interstate" transmission towers. Today's order interprets the 11th Circuit's ruling to preclude FCC authority over attachments only to "interstate" transmission towers. Transmission towers that are "part of a local distribution system," according to the Commission, continue to be regulated.

Yet to be resolved is the issue of precisely how cost-based rates for wireless attachments will be calculated. The Commission recognized that wireless attachments to distribution poles are substantially different from other attachments, but has provided no other guidance as to how to calculate such a rate. With respect to transmission towers, the Commission has developed no formula at all for any type of attachment.

If you would like to know how this ruling affects your existing contracts, or have other questions about today's ruling, please contact Tom Magee at 202-434-4128 or by e-mail at magee@khlaw.com.