— Lone issue on 5G "aesthetics" in Small Cell Order remanded to FCC
— Dissent limited to disagreeing with FCC's above-cost prohibitions on municipal fees in Small Cell Order
On August 12, 2020, a panel of the 9th Circuit in City of Portland v. FCC upheld all but one aspect of the Federal Communication Commission's (FCC) 2018 Small Cell, Local Moratoria and OTMR orders. The 82-page opinion (plus another 30 pages of appended 5G background material cited) represents a sweeping victory for the wireless industry with respect to its current efforts to deploy 5G antennas and equipment across the country and preserves important deployment efficiencies for wireline pole attachers.
In upholding the FCC orders, the court generally deferred to the FCC's "reasonable" interpretation of the Communications Act (including Sections 224, 253, and 332). In the one setback for wireless providers, the court vacated the provision in the Small Cell Order that sought to standardize local government interpretations of 5G aesthetics, and remanded that issue to the FCC.
The dissent was confined to a single disagreement with the majority's upholding the FCC's prohibition on municipalities charging providers fees in excess of costs (as opposed to just prohibiting "exorbitant" fees). Parties can seek rehearing by the panel, or the full court en banc, within 45 days, or seek certiorari within 90 days of the decision (or within 90 days after any rehearing petitions are resolved).
Our more detailed analysis of the opinion with respect to all three orders is available here, but the upshot is a significant win for wireless providers and third party attachers. The court upheld those aspects of the FCC's OTMR order that were challenged by a group of private electric utility pole owners pertaining to rules that generally codified the FCC's pre-existing overlashing policies and that protect against imposition of costly pre-overlash engineering studies. The court also upheld the FCC's OTMR order prohibiting utilities from requiring a new attacher to bear the cost of correcting preexisting safety violations on a pole.
The court further upheld pole attachment rate reform for ILEC attachments. Importantly, the utilities did not challenge the OTMR rules themselves. They did, however, challenge the related self-help rules for complex make-ready that allow new attachers to use a utility-approved contractor to perform work in the electric space using approved electric contractors if the pole owner delays performing that work . The court found that the FCC had accounted for safety concerns of the utilities and that it had not undermined the utilities' rights under Section 224 when such work is performed by utility-approved contractors.
As to the Small Cell Order, the court upheld two aspects related to fees imposed by municipalities (requiring them to be cost-based) and expanding the timing requirements to include approving permit applications and shortening the timeframe for approving permits and zoning applications (shot clocks). However, the court rejected a request to "deem granted" applications that are not acted upon by the end of the applicable shot clock.
The court also rejected claims that that the FCC orders violate:
- (1) The presumption against preemption of proprietary municipal conduct respecting use of rights-of-way;
- (2) The municipal exemption from Section 224 governing pole attachment rates, terms and conditions; and
- (3) An obligation to update a radiofrequency analysis of the safety of wireless transmissions.
With respect to one of the municipal challenges, the court vacated (and remanded to the FCC) the rules limiting local authority to consider the aesthetics of wireless installations. The court held that the FCC order requiring that local aesthetic regulations be "objective" was neither adequately defined nor its purpose adequately explained.
Lastly, the court upheld the FCC's Moratoria Order that prohibits state and local ordinances and practices that either explicitly ban 5G deployment ("express moratoria") or have the effect of unreasonably or indefinitely delaying 5G deployment ("de facto moratoria"). The court noted affected parties could challenge applications of the Moratoria Order on a case-by-case basis (as the FCC recognized). The court also rejected the municipalities' constitutional challenge to both the Small Cell and Moratoria orders under the Fifth and Tenth Amendments.