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A Louisiana Compromise

6/13/2008 8:00 PM Eastern

After two tries in three years, it appears Louisiana is close to approving a statewide video franchising bill, albeit one that will not include some of its biggest cities, such as New Orleans.

The state House overwhelmingly approved the AT&T-supported bill on June 10 on a 94-9 vote. The bill, championed by State Sen. Ann Duplessis (D-East New Orleans), was then sent back to the Senate, which approved the amendments added in the House. The bill was expected to be forwarded to Gov. Bobby Jindal by last Friday. He has 10 days to decide whether to sign it.

'FAIR' TREATMENT CITED

Louisana Cable Telecommunications Association CEO Cheryl McCormick said in a brief interview that the state's cable operators went to great lengths to see that they and their customers were treated fairly. “We think this bill accomplishes that,” she said.

The bill won't affect franchises in some cities — such as New Orleans or Baton Rouge — or parishes such as Jefferson and East Baton Rouge, because those governments have home-rule charters, allowing them to set their own terms for franchises and other business relationships.

Concern over the erosion of those local powers, plus anxiety that a state franchising scenario could cut some revenues to strapped local governments, led to the failure of a bill proposed in 2006.

While it was approved in the legislature, as it waited on the desk of then-Gov. Kathleen Babineaux Blanco, municipal opponents effectively lobbied it to death.

Organizations such as the Police Jury Association of Louisiana, which represents parish governments, feared potential loss of local revenue in the wake of Hurricane Katrina. So Blanco vetoed the bill and advised the legislature to try again.

This version does acknowledge local charter powers and ensures that municipalities can continue to receive up to 5% in franchise fees.

Cities will have to pass local ordinances to demand those fees, and are barred from creating other fees or assessments. The bill also allows local communities to levy another 0.5% of gross revenue to be used to support public-access programming.

If approved, new applicants will apply to the Secretary of State's office for a certificate of franchise authority. That office will have 30 days to act on the application; if the office doesn't act within that month, it is considered granted.

The certificate would go into effect 30 days from issuance.

LOCAL OBLIGATIONS

Incumbent operators in non-home-rule charter cities and parishes can apply to terminate their local franchises, but they will be required to live up to all obligations required under their local agreements through the expiration date.

State-issued franchises will be valid for 15 years, according to the current version of the bill.

September