4. Enforcement Proceedings
NextG's limited facilities-based CPCN permits NextG to provide radiofrequency transport services involving construction in or on existing utility poles and other existing structures. (See D.03-01-061, D.06-01-006, D.06-07-036.) That authority does not include ground-disturbing activity. NextG admits it has engaged in ground-disturbing activity in the construction of DAS networks, including the installation of new underground conduit in existing public rights-of-way to either pull fiber or make lateral connections between equipment on a pole and fiber or bring power to nodes. However, NextG states it engaged in these ground-disturbing activities in reliance on the authority of its wireless carrier partners, for whom it is building the networks. Wireless carriers have that authority, and NextG states that authority is sufficient for it to engage in new underground construction on behalf of those carriers.2
NextG originally applied for limited facilities-based authority in 2002, because it intended to install DAS networks and did not intend to engage in ground-disturbing activity. NextG's Proponent's Environmental Assessment (PEA), filed with Application 02-02-019, and refiled in Case (C.) 05-03-010, stated that NextG would install equipment exclusively in or on existing structures and facilities and would, if new construction of facilities was necessary to provision its services, comply with applicable rules and regulations in securing any expanded authority necessary for such construction. This application requests that authority while clarifying that NextG has operated within the confines of its current authority in constructing DAS networks. Specifically, NextG states:
[t]o date, NextG has been able to establish its network through the installation of its fiber on existing poles and in existing underground conduit in public rights-of-way and the installation of its microcells and antennas on existing poles in the public way. [footnote omitted] However, NextG now is facing difficulty in certain limited areas where existing poles and conduit in rights-of-way are not available or available only at a prohibitive
cost. . . . As a result, NextG will have to engage in limited installation of new poles and underground conduit (through which it will pull fiber) in existing public rights-of-way and existing private utility easements. The installation of new poles and underground conduit is beyond the scope of NextG's existing limited facilities-based authority.
In this application, NextG's PEA details the new construction activity, which consists of installation of poles, small-scale trenching and micro-trenching. After ExteNet filed its protest, NextG admitted it engaged in ground-disturbing activity for a number of DAS projects between issuance of D.03-01-061 and the filing of its application. The amount of ground-disturbing activity between those periods was approximately one mile. During that timeframe, NextG did not affirmatively disclose to the Energy Division environmental staff that it was trenching, as NextG's Vice President of Government Relations, Robert Delsman, testified at the hearing.
NextG maintains that the ground-disturbing activity, with a few exceptions due to failure to follow its procedures, was done under the authority of its wireless carrier partners. Applications for permits authorizing trenching submitted to local jurisdictions were filed in NextG's and the wireless carriers' names.
NextG's application is silent on the wireless carrier partner arrangement. Instead, NextG states:
In certain instances, it may be the case that the wireless carrier to whom NextG will provide service will undertake certain of the new construction activities described herein pursuant to the wireless carrier's existing commercial mobile service (CMRS) authority and subject to the terms and conditions of General Order ("GO") 159-A.
This statement that some construction activities would be undertaken by the wireless carrier differs from NextG's current position that it engaged in ground-disturbing activity under the wireless carrier's authority. There are internal NextG e-mails that discuss the arrangement, but no agreement with the wireless carriers formally discusses the terms under which such construction would occur.
Although an informal agreement may be sufficient to establish that NextG was using the authority of the wireless carriers to engage in ground-disturbing activities, the wireless carriers did not comply with our requirements for wireless carrier construction. NextG, on behalf of the wireless carriers and in its own name on several occasions, applied for and received necessary excavation permits from local jurisdictions. Although NextG understands our notification letter requirements under GO 159-A, before the protest to this application was filed, neither the wireless carriers for which NextG engaged in ground-disturbing activity nor NextG on their behalf submitted the GO 159-A notification letters necessary when land use approvals are required for cell siting and related construction activity. The one wireless carrier who complied with GO 159-A notification did so at a later date. The wireless carriers' failure to comply with our notification requirements belies NextG's claim that its arrangement with them was consistent with our rules and regulations.
Our earlier consideration of a proposed partnership arrangement for a CLEC does not support NextG's position that it could engage in new underground construction under the authority of the wireless carrriers. That decision declined to authorize a limited facilities-based CLEC, Cmetric, authority to engage in construction activities through a partnership arrangement with other certificated carriers. (D.99-11-025, 1999 Cal. PUC LEXIS 746.) NextG states that decision is distinguishable, because it did not consider the partnership arrangement presented here, that of a CLEC partnering with a wireless carrier that has the required authority to trench.
NextG's arguments in favor of its partnership arrangement permitting ground-disturbing activity are not persuasive. Cmetric presented the Commission with a proposal to enter into a partnership arrangement with certificated carriers and we rejected the proposal, because we needed to study and appropriately mitigate the impacts of any construction. NextG did not present its proposed partnership arrangement to us for our consideration, so there was no opportunity for us to fulfill our role under CEQA to review the environmental impacts of the proposed construction. Further, since no GO 159-A notification letter was submitted for any construction prior to the filing of this application, we could not have ascertained whether local land use approvals had been received.
NextG also did not act as the agent of the wireless carriers while constructing transport networks. NextG admits it has an ownership interest in components of the DAS network it installs on behalf of wireless carriers. Although the arrangements between NextG and the wireless partners are detailed, no provision in the agreements NextG entered into with the wireless carriers places ownership of new underground construction completed by NextG in the wireless carriers' names. At a minimum, NextG continues to own most of the network it constructed under contracts entered into with the wireless carrier partners.
NextG has failed to persuade us that it engaged in new underground construction under the authority of its wireless carrier partners consistent with our regulations. NextG's ground-disturbing activities are extensive; NextG had trenched approximately 64 miles before this proceeding was submitted. Therefore, a separate investigation should be opened to consider NextG's violation of its limited facilities-based authority, and NextG should be ordered to show cause why a penalty should not be assessed.
NextG was not forthright with us in discussing its ground-disturbing activities. Neither in the complaint case concerning the extent of its CLEC authority in constructing DAS networks (C.05-03-010) nor in its application did NextG disclose it was engaged in ground-disturbing activity. Only after ExteNet protested the application, did NextG admit its activities. Thus, the investigation we order should consider whether NextG violated Rule 1.1.
Although we find that an investigation should be opened to consider NextG's past behavior, NextG could have applied for and been granted full facilities-based authority, as we are doing in this decision, at the same time as ExteNet and CA-CLEC LLC. No environmental violations have been found for the new underground construction examined in this proceeding. To the contrary, NextG has demonstrated it complied with land use requirements of local jurisdictions and disturbed the ground to the minimal extent possible with small scale and micro-trenching. There also have been no complaints alleging environmental impacts. These factors should be considered in the investigation.
2 NextG installs some networks using existing conduit. These networks are within NextG's existing limited facilities-based authority.
