Court Denies Cell-Tower Company's Challenge to Initiative Requiring Voter-Approval Before City Can Lease Property

Decision Could Be Relevant to Upcoming FCC Rulemaking

An appellate court last week ruled that a provision of the federal Communications Act limiting how a local government may regulate the “placement, construction, and modification” of wireless-service facilities does not preempt a local initiative requiring voters to grant prior approval to the lease or license of certain city property. In the court’s view, Section 332(c)(7) of the Communications Act “applies only to local zoning and land use decisions and does not address a municipality’s property rights as a landowner.” The court found that the local initiative affected only the city’s approvals as a landowner, not its land-use regulation or adjudication. See more details on the decision at the IMLA Appellate Blog.

While the decision in a Huntington Beach case by the 9th U.S. Circuit Court of Appeals is good news for local governments and reaffirms a long-standing principle that federal preemption does not affect local governments acting in their proprietary capacities, its long-term impact may turn on the outcome of a new Federal Communications Commission rulemaking, which could limit local authority to control the size and placement of wireless facilities.

In that proceeding, the FCC asks whether regulatory limits that apply to a local government when it acts as a land-use regulator should also apply when the government leases its property.  The FCC tentatively concludes, consistent with this court decision, that regulatory limits do not apply when a local government acts in a proprietary role, but the industry may urge the Commission to take a different position.

A coalition of interested parties will be filing joint comments before the FCC’s February 3 deadline to encourage the federal agency to respect local interests.