X. Announcement of Application Review Results

Public Utilities Code § 5840 contains detailed instructions on notice and issuance procedures for our review of a state video franchise. Based upon this statute, the draft General Order included procedures addressing the following: (i) notification of state video franchise application completeness or incompleteness; (ii) issuance of a state video franchise by the Executive Director; and (iii) failure of the Commission to act on a state video franchise application. This section is devoted to review of parties' comments on these procedures.

A. Notification of Application Status

A variety of parties ask for information related to our review of a state video franchise application. These information requests encompass an application's submission, contents, and review results. This section describes and assesses the merits of various parties' requests.

1. Position of the Parties

CCTA argues that a copy of a state video franchise application must be provided to affected incumbent cable operators, just as a copy of the application is provided to each affected local entity.352 CCTA reasons this notice provision "will facilitate compliance with the obligations required by the Legislation, as well as allow the incumbent to be fully advised of its rights, obligations and opportunities triggered by the holder of the state-issued franchise."353

Small LECs agrees that incumbent cable operators should receive copies of state video franchise applications.354 According to Small LECs, this notice should come from the local franchising authority.355

DRA "recommends that notice of submitted franchise applications be posted on the Commission's website within 24 hours of their receipt by the Commission. Ideally, the non-proprietary portions of the Applications should be posted on the Commission's website as well."356 DRA sees this notice as essential to enabling parties to file timely protests (which DRA urges us to permit in the application process).357

League of Cities/SCAN NATOA support DRA's proposals concerning the posting of non-proprietary portions of state franchise applications or other related notices on the Commission's website.358

When we are "approving or denying a franchise application, or requesting more information from an applicant," Joint Cities urges the Commission to "provide written copies of the pertinent documentation to affected or potentially affected local governments concurrently with the provision of this documentation to the applicant."359 Joint Cities explains that this access to information is necessary "to successfully complete tasks respectively allocated to the Commission and the City by DIVCA."360

2. Discussion

There is significant statutory support for Joint Cities' request for information regarding state video franchise applications. Public Utilities Code § 5840(h) directs us to "notify . . . any affected entities [of] whether the applicant's application is complete or incomplete" and "specify with particularity the items in the application that are incomplete . . . ."361 Accordingly, the Executive Director shall provide notice of incompleteness and the specific reason for incompleteness in the same document. A copy of this document shall be provided to the "affected local entities."

If the Commission requests more information from an applicant, we find that the applicant shall provide a copy of this information to any affected local entities. This procedure obviates the need for the Commission to notify the affected local entities whenever we request additional data. Also, it is consistent with the statute's intent that local entities receive a copy of materials submitted when an applicant applies for a state video franchise.362

Regarding notice of other parties, we find no legal basis for requiring applicants or affected local entities to provide copies of state video franchise applications to incumbent cable operators. DIVCA does not require applicants to serve their applications on incumbent cable operators, and nothing in DIVCA otherwise vests in incumbent cable operators a right to concurrent service.363 Thus, we will not impose application distribution requirements urged by CCTA and Small LECs.

We, however, recognize that it is valuable for incumbent cable operators to have notice of our receipt of a state video franchise application. Thus, we promptly will post state video franchise applications and any responses to corresponding information requests on the Commission's public website. We will post these documents as expeditiously as possible, likely within three business days of receipt of an application document. We find that this measure - supported by DRA and League of Cities/SCAN NATOA - will ensure that interested parties are advised of state video franchise activity in California.364

B. Notification of Statutory Ineligibility

The draft General Order provided that an application will not be deemed granted due to the Commission's failure to act when the applicant is statutorily ineligible. This provision would apply whether or not the Commission is aware of the statutory ineligibility of an applicant.

We tentatively adopted this provision pursuant to Public Utilities Code § 5840(d). This statute establishes that no person or corporation shall be eligible for a new or renewed state video franchise if that person or corporation is in violation of any final nonappealable order relating to either the Cable Television and Video Providers Customer Service and Information Act or the Video Customer Service Act.365

While no party protests our proposed response to statutory ineligibility, Verizon asks that "[t]he General Order . . . provide that staff should notify the applicant of any specific ground for ineligibility . . . ."366 We find that this request is reasonable. We, therefore, modify the General Order to provide that the Commission will give the applicant and affected local entities notice and rationale for a determination that an applicant is statutorily ineligible to receive a state video franchise.

Finally, we note that any party at any time can bring us information that demonstrates an applicant, pursuant to Public Utilities Code §§ 5840 or 5930, is ineligible to obtain a state video franchise. Such information is relevant to the Commission's review of an application, and providing it does not constitute a protest to an application. Upon validation of evidence of ineligibility, we can respond in a number of ways, including rejection of an application, immediate suspension of a state video franchise, and/or issuance of an order to show cause for why a state video franchise should not be deemed invalid.

C. State Video Franchise Issuance by the Executive Director

CFC and Small LECs dispute whether it is appropriate for the Commission to delegate authority to the Executive Director to issue franchises. This section reviews and assesses these parties' positions.

CFC asserts that the Commission's "delegation of authority to its Executive Director to issue franchises to anyone capable of completing an application does not adequately protect the public."367 According to CFC, the "Commission has delegated its authority to review the application and issue the franchise to the Executive Director, without any guidelines for exercise of that delegated power."368

Small LECs rebuts that CFC's opposition of delegated authority to the Executive Director is "inconsistent with the Legislature's intent under AB 2987. Since the Commission's role in reviewing franchise applications is intentionally limited, handling these applications through the Executive Director is particularly appropriate."369

Like Small LECs, we find that delegated authority to the Executive Director is suitable for our statutorily limited role in reviewing state video franchise applications. The Commission, as described in detail in Section IX, must operate under tight timelines and may only determine whether an application is complete or incomplete. The Executive Director currently fulfills this role at the Commission, and it is appropriate to assign this role to the Executive Director.

352 CCTA Opening Comments at 11-12.

353 Id.

354 Small LECs Opening Comments at 6.

355 Id.

356 DRA Opening Comments at 4-5.

357 DRA Opening Comments at 4.

358 League of Cities/SCAN NATOA Reply Comments at 13-14.

359 Joint Cities Opening Comments at 22-23.

360 Id. at 22.

361 Cal. Pub. Util. Code § 5840(h)(1),(3).

362 See id. at § 5840(e)(1)(D) (requiring an applicant to "concurrently deliver a copy of [its] application to any local entity where the applicant will provide service").

363 Public Utilities Code § 5840(e)(1)(D) requires copies of state video franchise applications to be served concurrently on affected local entities, but does not provide for notice to incumbent cable operators.

364 See DRA Opening Comments at 4-5 (urging the Commission to post state video franchise applications on our public website); League of Cities/SCAN NATOA Reply Comments at 13-14 (supporting DRA's recommendation).

365 Cal. Pub. Util. Code § 5840(d) (citing Cal. Govt. Code §§ 53054 et seq. and Cal. Govt. Code §§ 53088 et seq.).

366 Verizon Opening Comments at 7.

367 CFC Opening Comments at 1.

368 Id. at 4.

369 Small LECS Reply Comments at 5.

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