Loading...
HomeMy WebLinkAbout12-07-1994 City Council agendaU A saRgr i 13777 FRUITVALE AVENUE SARATOGA, CALIFORNIA 95070 (408) 867 -3438 COUNCIL MEMBERS: DATE: December 7, 1994 Ann Marie Burger Paul E. Jacobs TO: City Council Gillian Moran Karen Tucker Donald L. Wolfe FROM: City Manager SUBJECT: Proposed Telecommunications Policy RECOMMENDED ACTIONS 1. Discuss this subject with staff and the public and consider the possible content of a Telecommunications Policy. 2. Continue discussion of this matter under Old Business to the meeting of January 4, 1995, for further consideration. 3. At that time adopt the Telecommunications Policy of the League of California Cities by reference with amendments as necessary. Direct the City Manager that he, the City Attorney and the City staff are to be guided b said policy in considering any future application for the development of fiber optic systems in the City of Saratoga. Since the subject of the TELECOMMUNICATIONS SUPER HIGHWAY arrived on the national scene, local government umbrella organizations, including the League of California Cities and the Association of Bay Area Governments, have been urged by a number of members to address what the TELECOMMUNICATIONS SUPER HIGHWAY will mean to local agencies. This has included what kinds of policy local city councils should be developing to guide city staff in dealing with the desire of cable companies, telephone companies and others to wire local communities for the capability envisioned by the development of the TELECOMMUNICATIONS SUPER HIGHWAY. As a result, proposed policies have been developed by the League and ABAG. In addition the Institute for Local Self Government developed, in 1991, a resource document entitled, "A Telecommunications Framework for Cities." Some of the members of the City Council have already reviewed a copy of a videotape prepared by the City of Milpitas on its recent telecommunications workshop. In addition the staff has attended two League- sponsored staff workshops this fall regarding this subject: and plans by Pac Bell to begin its fiber optic system conversion in various parts of the state. At this point we expect that Pac Bell will be presenting its proposals to the City staff in the next few months. Printed on recycled paper. Proposed Telecommunications Policy December 7, 1994 Page 2 Accordingly, staff seeks general guidance from Council in the form of a policy to use in reviewing proposals from Pac Bell and any other fiber optic plant developer. Also, South Bay CableVision is in the midst of constructing its own fiber optic network as required by its current franchise agreement. It: is expected this network will be complete in the Spring of 1995. Finally, this entire area of emerging technology is complicated by current federal regulation, ongoing court challenges to those regulations, and the prospect of federal legislation and revised federal regulations as to who is going to be allowed to do what, when and where. For these reasons staff feels it is appropriate at this time for Council to consider adopting some form of t: elecommunications policy, such as those proposed, to guide staff. DISCUSSION As set forth in the ABAG document and others, the themes most often presented in terms of local interest are five in number. These are: 1. Universal Access 2. Local Control 3. Compensation 4. Consumer Protection 5. Technological Concerns Here is how these concerns relate to Saratoga: 1. Universal Access Neither the cable system nor the Pac Bell system propose to provide access to all residents, businesses and institutions, both public and private, in Saratoga. Our franchise agreement with South Bay limits their system build requirement to a density of 20 homes per 1/2 mile of cable plant. An amendment to the agreement would be required to have the company build into all areas of the City. The Pac Bell service area granted by the PUC does not cover all areas of the City. The southeast section of the City is in a General Telephone area and would not be getting the new Pac Bell system. 2. Local Control At the present time the City has a large measure of local control over the cable company through the franchise ordinance and the franchise agreement. This includes service standards and limited rate determination. We also control the use of the City's right -of -way for the purpose of construction of the physical plant. This utility coordination control is an essential element in the furtherance of our pavement management program. Proposed Telecommunications Policy December 7, 1994 Page 3 3. Compensation Currently the cable company must pay the city a franchise fee of 5% of gross revenue to off set the costs of administration of the franchise, rental of public rights -of- way and to support-community access television. The company is also required to provide space on the system" for PEG (public access, education and government) access and participate, as required by the franchise agreement, in providing equipment and wiring of public facilities. The City has no such ability with Pac Bell and, in fact, is precluded under current law from requiring a franchise from them. Nevertheless, it has been argued by some that other forms of compensation such as equipment and access and encroachment fees for use of the right -of -way should be pursued locally. 4. Consumer Protection Concerns in this area center around protection of confidential information transmitted with new technology, the possible development of cross subsidies by companies who provide video dial tone, and competitive pricing to all consumers regardless of status. 5. Technological Concerns Examples of concerns which come to mind center around insuring that cities have the opportunity to access and use the technology for governmental operations, that various networks are interconnected and not developed in isolation or with limited inter operability capacity, and that existing technology is not rendered obsolete by design. FINDINGB AND CONCLUSIONS: This entire area.of technology is in a constant state of flux at the present time. In order for the interests of the City to be protected it is important for the City Council to establish a broad policy framework as a backdrop against which proposals for development of the capacity for the INFORMATION SUPER HIGHWAY can be judged. This will allow the City to be proactive rather than reactive to the extent that it can be, given the circumstances. Being in a proactive position will, I believe, create the best environment for the City to get what it wants out of any future application to build a portion of the INFORMATION SUPER HIGHWAY in the City of Saratoga. Al'� Harry V Peacock City Manager HRP:hrp:jm Proposed Telecommunications Policy December 7, 1994 Page 4 Attachments 1. Telecommunications Policy League of California Cities 2. Telecommunications Policies ABAG 3. Resolutions of the City of Milpitas regarding the National Information Infrastructure. Supporting the League's Telecommunications Policy and Adopting a Telecommunications Policy for the City of Milpitas 4. Institute for Local Self Government A Telecommunications Framework for Cities League of California Cities f Telecommunications Policy As adopted April, 1994 Executive Summary The 1990s will witness the rapid development and deployment of advanced telecommunications services. The telecommunications industry is developing digital technology to enhance its traditional delivery system copper wire for voice, coaxial cable for video -to support a host of new services. These industries are also developing high speed /high capacity networks, commonly referred to as broadband networks, that are capable of integrating voice, data, video services along a single wire. The development of advanced telecommunications infrastructure, often referred to as the information superhighway, promises to increase competition and to stimulate economic development as new products and services are introduced into the telecommunications marketplace. California cities can look forward to using these innovative technologies to enhance public services and streamline government operations. While the information superhighway presents considerable opportunities, it also carries an element of uncertainty and risk, and has significant fiscal and policy implications for cities. For example, under current law, cable operators are subject to municipal franchise agreements, which include local control over rates and customer service standards, as well as franchise fees. Telephone companies, on the other hand, are exempt from these franchise provisions. As advanced telecommunications technology makes telephone service less discernable from cable service, cities' franchising authority may be in jeopardy. The telecommunications industry is already leveraging to take advantage of the changes in the marketplace. Regional telephone companies are merging with cable TV companies in order to circumvent the existing "cross- ownership" ban which prohibits telephone companies from providing video services, and cable operators from providing telephone service. In California, Pacific Bell has filed suit to challenge this ban as it deploys a $16 billion plan to wire residential areas in the state with broadband capacity. Furthermore, the Clinton Administration has stated its intent to remove regulatory "barriers" at all levels of government in order to streamline the development of advanced telecommunications services. As these events unfold, the regulatory powers cities enjoy are becoming increasingly vulnerable, and cities must take steps to ensure that their role in protecting the interests of their communities is not sacrificed in the interest of developing the information superhighway. Principles that Guide League Telecommunications Policy The League of California Cities has developed the following principles that reflect the interests of cities in the development of telecommunications policy: Cities must have certain regulatory powers over telecommunications service providers in order to protect city infrastructure, ensure open access to telecommunications League of California Cities 1 Telecommunications Policy r services, protect the privacy of consumers of these services, and correct the market inequities that will occur when the advanced telecommunications services market becomes open and competitive. Cities should receive compensation for use of the public right -of -way from all users of the public right -of -way, including telecommunications service providers. Cities should also receive compensation for the short- and long -term negative impacts of installing fiber -optic and other telecommunications wire in city streets and in the public right -of -way. Securing these revenues will be especially important if municipal franchises for cable service are eliminated due to a softening of the existing regulatory and franchise powers. Cities recognize that broadband capacity has considerable value, in that it can be used both to support city operations and to streamline delivery of a variety of public services. Cities should receive an appropriate allocation of all advanced telecommunications resources, such as bandwidth on broadband networks, fiber -optic wiring, and spectrum on the 800 Mhz radio frequency, that operate within their sphere of influence. Summary of the Telecommunications Policy Statements Universal Access Legislation enacted to facilitate the development of the National Information Infrastructure, and the California Information Infrastructure, should ensure that access to advanced telecommunications services is available to all citizens, as well as the commercial, education, and government sectors. Role of City in_Regulatory Structure The League supports efforts to establish an open, competitive marketplace for telecommunications services, including the lifting of the cross ownership ban and a level playing field for telecommunications service providers. An integral component of this open marketplace is the symmetrical application of regulations to all telecommunications service providers, including wireless service providers. The League also supports the preservation of local authority over matters of local impact. League of California Cities 2 1 Telecommunications Policy Compensation for Use of Public Rights -of -Way and Negative Impact on Local Infrastructure The use of public streets and rights -of -way via the installation of pipes, conduits and wires to engage in private, for profit enterprise demands a fair payment, for the use of the public's asset. The League supports a symmetrical application of right -of -way fees for all users of the public right- of:way, including telecommunications service providers. Cities should also receive compensation for the short- and long -term negative impacts of installing fiber -optic and other telecommunications wire in city streets and other locations in the public right -of -way. Cities as Users /Providers of Telecommunications Services The League recognizes that advanced telecommunications resources have considerable value. Cities should help safeguard citizens against market inequities in the advanced telecommunications marketplace by maximizing their ability to utilize and facilitate access to telecommunications resources. Adequate Spectrum Capacity for Public Safety and Other Public Use Cities should be allocated adequate spectrum on the 800 Mhz radio frequency for public safety, emergency services, public works, and other public use. FCC Certification of Local Franchising Authority The League encourages cities to certify their local cable TV franchising authority to protect the interests of their. citizens. Federal and state law should secure the rights of local franchise authorities to regulate cable service rates if they have received certification from the FCC. Privacy The League supports the protection of privacy and security for consumers of advanced telecommunications services. League of California Cities 3 Telecommunications Policy League of California Cities Telecommunications Policy Table of Contents EV4 Foreword............................. .............................ii Background........................................................ 1 Telecommunications Policy at the Federal Level 1 Telecommunications Policy at the State Level 2 Telecommunications Policy at the Local Level 2 "A Telecommunications Framework for Cities" 3 Policy Statements 4 Universal Access 4 Role of the City in Regulatory Structure 5 Compensation for Use of Public Rights -of -Way and Negative Impact on Local Infrastructure 5 Cities as Users /Providers of Telecommunications Services 6 Adequate Spectrum Capacity for Public Safety and Other Public Use 7 FCC Certification of Local Franchising Authority 7 P 8 League of California Cities i Telecommunications Policy Rarely a day goes by that one does not hear some reference to the so called "information superhighway". The rapid development .of advanced telecommunications resources, such as fiber optic networks that will carry, voice, video and data signals, carries the promise of new economic prosperity and new tools for streamlining the delivery of both public and private services. While California. cities can look forward to enjoying these benefits in the near future, we must also be mindful of the impact of the emergence of this spawning industry both on cities, and on the citizens they serve. To this end, the League of California Cities has developed a comprehensive telecommunications policy that will help. cities define their roles as user, provider, regulator, and consumer advocate on the information superhighway. The policies outlined in this report area product of the knowledge, experience and values of several dozen city officials who make up the League's Telecommunications Task Force. A primary objective of the Telecommunications Task Force has been to increase city officials' awareness of the relevance of telecommunications policy in the business of local government.. The Task Force has spent the past five years addressing telecommunications issues as they relate to cities. Over the years, their work has included educational forums, pilot projects for telecommuting and facilities sharing, and a comprehensive report entitled A Telecommunications Framework for Cities which was developed by the Institute for Local Self Government and adopted by resolution at the League Annual Conference in 1991. The policy statements contained in this report are the latest work product in a continuing effort to develop meaningful resources for cities to use in dealing with the complex and ever changing arena of advanced telecommunications. Cities should use these policies to guide their discussions and negotiations with telecommunications providers who wish to do business in their city. While these policies cover a wide range of telecommunications issues, the League is mindful that this is a "living" document that will change and evolve continuously to reflect the evolution of the advanced telecommunications industry. The League invites cities to share ideas and concerns regarding it's telecommunications policy. Input from the telecommunications industry, our partners in the development of a California Information Infrastructure, is also welcome. Most important, the League urges cities to participate in the work of the Telecommunications Task Force so that we can expand both the scope and the depth of these policies. League of California Cities ii Telecommunications Policy Background Telecommunications Policy at the Federal Level The National Information Infrastructure The Clinton Administration, under the direction of Vice President Al Gore, is promoting the development of the National Information Infrastructure (NII). According to its advocates, the NU will be an integrated network system that will "ultimately connect the nation's businesses, residences, schools, health care facilities, and other public information and social service providers through a broadband, interactive, telecommunications and information network." Citing the need for a new policy framework to streamline the development of the NH, Vice President Gore outlined a legislative agenda.that will create a "flexible, adaptable approach" to the telecommunications industry. The Administration's initiatives reflect the following objectives: Increase competition and private investment in communications by removing unnecessary regulations and artificial barriers to participation by private firms in all communications markets. For example, the Administration proposes to permit cable companies and others to provide local telephone service; Secure open access to the network for consumers and service providers. For example, the legislation requires all local telephone companies, upon reasonable request, to interconnect their networks with the facilities of competing providers on nondiscriminatory terms; Preserve and advance universal service for all Americans across all sectors of society. Because full and productive participation in American society will increasingly depend on access to information, the Administration is committed to promoting the availability of information resources to all people at affordable prices; Develop a new regulatory framework that is flexible and fair by allowing the FCC to reduce regulation for telecommunications carriers that lack market power. 1992 Cable Act In addition to establishing benchmark rate regulations for cable TV service, the 1992 Cable Act strengthened local governments' role in regulating cable television by outlining local franchise authority over cable service. The Act allows local governments to certify franchising authority with the FCC and, based on approval of certification, to regulate basic cable service rates in their area. Local franchise authorities may also establish and enforce customer service standards and construction schedules. League of California Cities 1 Telecommunications Policy Telecommunications Policy at the State Level California PUC Report A November, 1993 report from the California Public Utilities Commission entitled "Enhancing California's Competitive Strength: A Strategy for Telecommunications Infrastructure," makes the following findings: Public networks should be linked in an integrated, interoperable infrastructure Universal access is a key component of the infrastructure that includes affordable applications, low cost customer equipment, education and training programs. Universal service should be transformed from a subsidized monopolistic model to a competitive, multi provider model. Competitive forces should drive the infrastructure and minimize the potential for publicly funded infrastructure. All telecommunications markets should be open and regulatory process should be streamlined. The report specifies a three -year time frame in which to eliminate cross domain barriers. The report also places the bulk of regulatory authority with the PUC. The state should create 'open competition zones" to assess the impact of open competition in the telecommunications market. Telecommunications Policy at the Local Level City Efforts to Comply with the Cable Act As stated previously, the 1992 Cable Act outlines specific regulatory roles for local governments. A key issue facing local governments is that cities must obtain certification from the FCC in order to secure regulatory authority of basic cable service rates. For many cities, the rate review analysis required as part of the certification process has been complex and difficult to complete. To date, approximately half of the cities in California that could certify have done so. While federal and state officials continue to urge cities to certify, the recent statements regarding removing regulatory barriers to a competitive telecommunications market raise an important question: Does it make sense for cities to obtain FCC certification if the regulatory powers the certification process seeks to establish are going to be eliminated or significantly reduced to open the telecommunications marketplace? League of California Cities 2 Telecommunications Policy 'A Telecommunications Framework for Cities" This report, presented by the Telecommunications Task Force in 1991, outlines telecommunications issues and trends, and provides options available to cities acting as telecommunications user, consumer and policy- maker. A Telecommunications Framework for Cities prepared by the Institute for Local Self Government makes the following observations: Effective use of telecommunications can increase efficiency and provide new solutions to city problems. Cities' current investment in telecommunications is significant and will grow, but lack of coordination among city departments results in inefficient use of these resources and a lack of planning for future needs. Municipal governments are dependent now on transportation and communications to conduct the public business while the community depends on the same combination to access vital services and information. This reliance of communications will increase as city governments and citizens alike are forced to find alternatives to automobile travel. Many cities are unprepared to utilize the full potential of available telecommunications technologies effectively: Current uses are concentrated in a few departments. There are few central resources for planning and implementing new applications. Consumer decisions are often motivated by mistake avoidance rather than meeting the needs created by new applications. Development programs are inhibited by the lack of knowledge about total telecommunications costs, invested capital, and physical plant. Local telecommunications policies beyond the cable television franchise are rare, and cable television policy in many cities fails to address community needs. Federal and state legislatures and regulatory agencies are changing the rules governing telecommunications markets to create competition and spur innovation. These changes will affect pricing and impact long- standing public policy, such as universal phone service. Cities lack a coherent, comprehensive position on the role of cities in a competitive telecommunications marketplace. League of California Cities 3 Telecommunications Policy Policy Statements Universal Access One of the most important policy issues `surrounding telecommunications is that of universal access to telecommunications services. Policy- makers at all levels of government have expressed concern over the potential for creating a system of information "haves and have- nots." However, while terms such as open access and interoperability are used frequently in discussions of the National Information Infrastructure, a working definition of universal access has not been adopted at any level of government. The League's definition. of universal access is reflected in its policy statement: Policy Statement Legislation enacted to facilitate the development of the National Information Infrastructure, and the California Information Infrastructure, should ensure that access to advanced telecommunications services is available to all citizens, as well as the commercia4 education, and government sectors. Elements of universal access should include. Open access to consumers as well as service providers Connectivity to business and government, as well as residential areas Uniform and indiscriminate wiring of all locations in a business or residential area Affordability of services, equipment and training Flexibility of service options and delivery mechanisms to reflect the needs of individual communities Competitive choice in consumer service options Fees or charges to fund universal service provision Ability to send and receive information at transmission rates that are adequate for broadband applications Ability to communicate with any individual on a network (addressable communications) 1 The League recommends a minimum bandwidth of ten (10) megabytes per second, bi- directionally. League of California Cities 4 Telecommunications Policy Role of the City in Regulatory Structure The impetus for removing regulatory barriers to a competitive telecommunications marketplace is strong. Recent federal and state policy reports suggest that regulatory authority over service delivery, rates, and customer service standards should be consolidated either at the federal or state level. While there are sound arguments for streamlining regulations, the fact remains that telecommunications services will be delivered locally and the nature and scope of these services will be different from community to community. The deployment of advanced telecommunications networks will also have considerable impact on the economic development and vitality of communities, as well as an impact'on local infrastructure. Hence, the League's policy on streamlining regulation seeks to preserve cities' ability to secure telecommunications services that reflect the needs of their communities and to preserve and enhance city infrastructure. Policy Statement The League supports efforts to establish an open, competitive marketplace for telecommunications services, including the lifting of the cross ownership ban and a level playing field for telecommunications service providers An integral component of this open marketplace is the symmetrical application of regulations to all telecommunications service providers, including wireless service providers. The League also supports the preservation of local authority over matters of local impact, including: Construction standards permitting, scheduling, and cost recovery Customer service standards Rate regulation for cities that choose to regulate 1 Negative impact on local infrastructure and cost recovery City use of telecommunications resources (local PEG access, I- Nets) Method of installation (pedestals, overhead, under ground) Compensation for Use of Public Rights -of -Way and Negative Impact on Local Infrastructure The traditional right of franchising includes the power of a city to choose who may enter the market by granting or withholding a franchise. Franchising powers contain implicit 2 Includes the provisions of California PUC Rule 20A, (Undergrounding Program) which would require telecommunications facilities to participate by placing underground all overhead facilities within any underground district legislated by a city. League of California Cities 5 Telecommunications Policy legal barriers to market entry, which some argue are inconsistent with the policy. of an open and competitive market. One mechanism that has been proposed to remove the legal barriers to telecommunications markets, while preserving the regulatory powers cities need to protect the interests of their communities, is to replace the franchise. fee element of the 1992 Cable Actwlth a right way.compensation statute In addition ao compensation for use of right of-way:cities:should receive.compe'nsation for,the short- and long -term negative impacts, of:installing fiber- opric ;and_other.telecommunications wire, such as street degradation and the increased maintenance costs that occur.when streets are opened. Policy Statement The use of public streets and rights -of -way via the installation of pipes, conduits and wires to engage in private, for profit enterprise demands a fair payment for the use of the public's asset. The League supports a symmetrical application of right -of -way fees for all users of the public right -of -way, including telecommunications service providers. 'Cities should also receive compensation for the short- and long -term negative impacts of installing fiber -optic and other telecommunications wire in city streets and other locations in the public right -of- way... Cities as Users /Providers of Telecommunications Services One element of many cable franchise agreements is the development of institutional networks (I -NETS) that give municipalities cable TV facilities and'other telecommunications resources. Advanced telecommunications technology will make many of these I -NET systems obsolete. However, cities have the opportunity to acquire a portion of a broadband network (commonly referred to as bandwidth), as well as other advanced telecommunications resources through franchise or other agreements.' Acquiring bandwidth on a broadband network would allow municipalities to develop a wide range of telecommunications -based applications both for internal use, and for providing services to their communities. City- provided telecommunications services could also help mitigate market inequities in the telecommunications market. For example, if the costs of installing and operating broadband networks prices the access to these networks beyond the incomes of certain citizen groups, cities could create public access systems, ,such as information kiosks or library terminals to facilitate access. Policy Statement The League recognizes that advanced telecommunications resources have considerable value. Cities should help safeguard citizens against market inequities in the advanced telecommunications marketplace by maximizing their ability to utilize and facilitate access to telecommunications resources. Strategies to accomplish these objectives include. Negotiate for an appropriate allocation of all advanced telecommunications resources, including bandwidth on broadband networks, fiber -optic wiring, and spectrum on the. 800 Mhz radio frequency, that operate within the city's sphere of influence. League of California Cities 6 Telecommunications Policy Install and operate city-owned broadband networks, and /or form partnerships to install and operate regional broadband networks. Explore and develop public service applications that employ advanced telecommunications capabilities, so that these resources can be put to use as soon as they are available. Secure public access to advanced telecommunications networks by way of existing PEG access requirements Identify and inventory unused and /or abandoned conduit that exists in the public right -of -way, in easements, or on property owned by the city, and develop strategies to leverage the use of these resources. Adequate Spectrum Capacity for Public Safety and Other Public Use During the conversion of city police, fire, emergency and public works radio services to the 800 Mhz spectrum, not enough spectrum was allocated to cities. As a result, in metropolitan areas, there has been a deterioration in transmission quality and the ability for police, fire, and public works departments to broadcast. With the coming of enhanced wireless, cellular, and personal communications services (PCN /PCS), cities may lose again if adequate spectrum for these services is not reserved for city uses. Policy Statement Cities should be allocated adequate spectrum on the 800 Mhz radio frequency for public safety, emergency services, public works, and other public use. FCC Certification of Local Franchising Authority As stated previously, the 1992 Cable Act outlines the requirements and procedures for cities to request certification as local franchising authority in order to regulate basic cable TV service rates. In the interest of protecting the interests of their citizens, it is desirable for cities to continue to regulate cable service rates in their communities. However, for many cities, the rate review analysis required as part of the certification process has been complex and difficult to complete. Cities must also decide if it makes sense to obtain- FCC certification if their regulatory powers are going to be preempted by new federal or state laws. Policy Statement The League encourages cities to certify their local cable TV franchising authority to protect the interests of their citizens. Federal and state law should secure the rights of local franchise authorities to regulate cable service rates if they have received certification from the FCC. League of California Cities 7 Telecommunications Policy Privacy A fundamental issue surrounding the development of the National Information Infrastructure (NII) is the need to assure the privacy and security of its users. While cities may not play a primary role in enforcing laws that govern privacy, they can be active participants in the policy debater Policy Statement The League supports the following principles that govern the. issues of privacy and security for consumers of advanced telecommunications services. Protection and reliable identification of the "digital signature" that identifies the sender and recipient of electronic transactions Transaction security for financial and other personal transactions Control over the sale of subscriber information' Freedom of choice in the use of encryption technology to ensure privacy and security League of California Cities 8 Telecommunications Policy Joseph ,ort MetroCenter Mailing Address: i Eighth &Oak Streets P.O. Box 2050 iDAR4d Oakland Oakland. CA 94604 -20E (510) 464 -7900 Fax: (510) 464 -7970 Date: October 20, 1994 To: Executive Board From: Mayor Peter W. Snyder, Legislation and Governmental Organization Committee Chair Re: Telecommunications (Information Superhighway) Policies On April 21, 1994, the General Assembly adopted Resolution No. 1 -94, calling for ABAG to "develop policy guidelines and a model ordinance to promote installation of the Information Superhighway in all new construction projects..." In response to that directive, the Legislation and Governmental Organization Committee has prepared the following list of policies for distribution to cities and counties in the Bay Area. These policies have been compiled from a variety of sources: National Association of Counties (,NACQ) 202/393-6226 League of California Cities _(LCC) Telecommunications Task Force Councilmember Linda Perry (City of San Leandro), Chair 510/577-3200 City of Milpitas Cecilia Quick, Assistant City Attorney 408/942-3236 Sacramento Cabletelevision Commission (SCC) Richard Esposto 916/440 -6661 Common themes raised by those sources include: A. Universal access B. Local control C. Compensation D. Consumer protection E. Technological concerns 1 A. UNIVERSAL ACCESS 1. Ensure universal access and interconnectivity to residents, businesses, and public agencies and institutions in the City. (Milpitas) 2. Ensure the maximum number and variety of telecommunications services to residents, businesses, and public agencies and im>titutions in the City. (Milpitas) 3. Universal Access Legislation enacted to facilitate the development of the National Information Infrastructure and the California Information Infrastructure should ensure that access to advanced telecommunications services is available to all citizens, as well as the commercial, education,, and government sectors. Elements of universal access should include: Open access to consumers as well as service providers Connectivity to business and government, as well as residential areas Uniform and indiscriminate wiring of all locations in a business or residential area Affordability of services, equipment and training Flexibility of service options and delivery mechanisms to reflect the needs of individual communities Competitive choice in consumer service options Fees or charges to fund universal service provision Ability to send and receive information at transmission rates that are adequate for broadband applications Ability to communicate with any individual on a network (addressable communications) (LCC) 4. Local governments may require universal services which include nondiscriminatory pricing and equal access to all its citizens as a requirement for granting a franchise. (NACo) B. LOCAL CONTROL 5. Local government has the right to control the use of its public rights -of -way which cannot be used without permission of the responsible local government authority. (NACo) 6. In order to use the right -of -way, a private telecommunications company, including a telephone company, must enter into a franchise agreement with local government which sets the terms and conditions of such use /access. (NACo) 2 7. Local governments should have control over allocation of the rights -of -way and be able to ensure that transportation is not disrupted nor the useful life of the right of -way diminished. (NACo) 8. Local governments have the right to review mergers and acquisitions when such activity might result in the reduction of competition in the marketplace. (NACo) 9. Local governments shall have the right to require the highest standards for video platforms in order to ensure capability for integrating telecommunications providers. (NACo) 10. Minimize disruption to Public Property and ensure efficient use of the City's streets. (Milpitas) 11: Role of the City in Regulatory Structure The League supports efforts to establish an open, competitive marketplace for telecommunications services, including the lifting of the cross ownership ban and a level playing field for telecommunications service providers. An integral component of this open marketplace is the symmetrical application of regulations to all telecommunications service providers, including wireless service providers. The League also supports the preservation of local authority over matters of local impact, including: Construction standards, permitting, scheduling, and cost recovery Customer service standards Rate regulation for cities that choose to regulate Negative impact on local infrastructure City use of telecommunications resource (local PEG access; I -nets) Method of installation (pedestals, overhead, underground) (LCC) 12. Streets and Right -of -Way Protection *Encroachment Permits: scheduling of work; street markings; USA notification; property owner notification; permit copy available on -site; street trench plan; street boring plan; street improvement plan coordination; other utility coordination; permit clearance and warranty. Construction Codes: general; PUQ electrical; local; noise, dust, environmental. *Use of Above and Below Ground Pedestals: property owner notification; placement mitigation. Insurance and Bonding Inspection and Impact Fees: fee schedule; inspector availability. 3 Safety Practices: worker safety; passer -by safety; traffic control. Tree and scrub trimming. Work site communications Inspector's Authority /Inspection logs. Work site clean -up (SCC) C. COMPENSATION 13. Local governments must'be paid a fee for the commercial use of a right -of -way by a telecommunications provider. (NACo) 14. Require telephone companies offering video dialtone cable services to be subject to the same franchise requirements and regulations as existing cable companies. (NACo) 15. If state law permits, local governments may impose taxes on wireless telecommunications providers. (NACo) 16. Receive fair compensation to the City for the use of Public Property and for City participation in development of a Telecommunications System. (Milpitas) 17. Compensation for Use of Public Rights -of -Way and Negative Impact on Local Infrastructure The use of public streets and rights-of-way the installation of pipes, conduits, and wires to engage in private, for -profit enterprise demands a fair payment for the use of the public's asset. The League supports a symmetrical application of right -of -way fees for all users of the public right -of -way, including telecommunications service providers. Cities should also receive compensation for the short- and long -term negative impacts of installing fiber -optic and other telecommunications wire in city streets and other locations in the public right -of way. (LCC) D. CONSUMER PROTECTION 18. A framework must be set forth for the protection of confidential information. (NACo) 19. Companies wishing to provide telecommunications of video services must _be subject to safeguards to protect consumers against cross subsidies. This includes video dialtone services. (NACo) 4 20. Ensure reliable telecommunications services to the lowest cost to residents, businesses, and public agencies and institutions in the City. (Milpitas) 21. Privacy The League supports the following principles that govern the issues of privacy and security for consumers of advanced telecommunications services: Protection and reliable identification of the "digital signature" that identifies the sender and recipient of electronic transactions. Transaction security for financial and other personal transactions Control over the sale of subscriber information Freedom of choice in the use of encryption technology to ensure privacy and security (LCC) E. TECHNOLOGICAL CONCERNS 22. Cities as Users /Providers of TelPrnmmttni ations Services The League recognizes that advanced telecommunications resources have considerable value. Cities should help safeguard citizens against market inequities in the advanced telecommunications marketplace by maximizing their ability to utilize and facilitate access to telecommunications resources. Strategies to accomplish these objectives include: Negotiate for an appropriate allocation of all advanced telecommunications resources, including bandwidth on broadband networks, fiber -optic wiring, and spectrum on the 800 Mhz radio frequency, that operate within the city's sphere of influence. Install and operate city -owned broadband networks, and /or form partnerships to install and operate regional broadband networks. Explore and develop public service applications that employ advanced telecommunications capabilities, so that these resources can be put to use as soon as they are possible. Secure public access to advanced telecommunications networks by way of existing PEG access requirements. Identify and inventory unused and /or abandoned conduit that exists in the public right -of -way, in easements, or on property owned by the city, and develop strategies to leverage the use of these resources. (LCC) 23. "Connectivity" or "Interog b' Provisions should be made to ensure that individual networks can communicate with one another; that systems established by competing service providers (telephones/ cable) will be compatible and not mutually exclusive; and that systems or services approved by a city or county will be compatible with neighboring jurisdictions. The Bay Area, as a region, should achieve a compatible, if not a uniform, telecommunications system. (ABAG) 5 24. Compatibility with Existing Technology Provisions should be made to incorporate current hardware and existing technologies to the extent feasible and practicable. (ABAG) 25. Adequate Spectrum Capacit4 for Public Safety and Other Public Use Cities should be allocated adequate spectrum on the 800 Mhz radio frequency for public safety, emergency services, public works, and other public use. (LCC) 26. Receive appropriate allocation of telecommunications services, equipment and bandwidth, including spectrum space for police, fire and City services. (Milpitas) F. OTHER ISSUES 27. Local governments shall have the right to analyze the legal, financial and technical qualifications of any telecommunications provider wanting to use the public right -of -way and shall have the right not to issue a franchise to an unqualified applicant. (NACo) 28. Public education and governmental access serving the local community shall be a requirement that must be imposed on telecommunications providers. (NACo) 29. The Information Superhighway must include the delivery of services and connection of major public facilities, such as schools, libraries, hospitals and other government facilities. (NACo) 30. FCC Certification of Local Franchising Authority The League encourages cities to certify their local cable TV franchising authority to protect the interests of their citizens. Federal and state law should secure the rights of local franchise authorities to regulate cable service rates if they have received certification frem the FCC. (LCC) 31. Enhance the City's economic development programs. (Milpitas) A of M �t #�1 of ilyita8 �j y 455 E. Calaveras Blvd. Milpitas, California 95035 September 23, 1994 The Honorable Mayor Ann Marie Burger and Council Members The City of Saratoga 13777 Fruitvale Ave. Saratoga, CA 95070 Dear Mayor Burger: This letter is to inform you that the City of Milpitas has adopted two resolutions regarding the National Information Infrastructure, also referred to as the Information Super Highway. For more information, please call the City Manager's Office at (408) 942 -2317. Sincerely, Eliren Pasion Cable Television Public Information Specialist AS/20830/L An Equal Opportunity Employer RESOLUTION NO. 6352 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF MILPITAS SUPPORTING THE LEAGUE OF CALIFORNIA .CITIES TELECOMMUNICATIONS POLICY WHEREAS, the City of Milpitas "City recognizes the importance of the emerging National Information Infrastructure, also referred to as the Information Superhighway; and WHEREAS, the City believes that development of this new infrastructure raises important social, economic and public service policy questions; and WHEREAS, the City believes that development of this infrastructure will be a massive public works project, resulting in traffic disruption, noise and air pollution, and reduced street pavement life; and WHEREAS, the City believes that cities should have a voice in the development of this infrastructure; and WHEREAS, the City believes that cities need to protect the public rights -of- way, receive compensation for the use of the street by private companies and receive a fair allocation of services, resources and bandwidth from companies developing this new infrastructure; and WHEREAS, the League of California Cities has adopted a Telecommunications Policy, attached as Exhibit 1; and WHEREAS, the City fully supports and endorses the efforts of the League of California Cities to preserve and protect the rights of cities and to address cities' concerns with respect to this new infrastructure. NOW, THEREFORE, BE IT RESOLVED as follows: 1. The City of Milpitas supports and endorses the League of California Cities Telecommunications Policy. 2. The City of Milpitas agrees with the tenets set forth in 'the League of California Cities Telecommunications Policy, specifically that: a. Access to advanced telecommunications services must be available to all citizens, as well as the commercial, education and government sectors. b. There should be an open, competitive marketplace for telecommunications. C. Cities must have a role in the regulatory structure to preserve their local authority over matters of local impact. -2- r d. Cities must be compensated for use of public rights -of -way and negative impact on local infrastructure. e. Cities should help safeguard citizens against market inequities in the advanced telecommunications marketplace by maximizing cities' ability to utilize and facilitate ,access to telecommunications resources, including the option of cities becoming providers. Cities should be allocated adequate spectrum capacity for public safety, emergency services,*public works and other public use. 2. NOW THEREFORE, BE IT FURTHER RESOLVED by the City Council of the City of Milpitas that the City Manager is directed to transmit this resolution to the National League of Cities, the California League of Cities, to state and federal elected officials representing the City of Milpitas, and to mayors and city councils within Santa Clara County. PASSED AND ADOPTED this 6thiay of Sept. 1994, by the following vote: AYES: (5) Mayor McHugh, and Councilmembers Lawson, Lee, Livengood and Skyrud NOES: (0) None ABSENT: (0) None ABSTAIN: (0) None ATTEST: Gail Blalock, City Clerk APPROVE AST FORM: 2 D v arse ity Attorney APPROVED: Peter A. McHugh, Ma AS 20274/ G RESOLUTION NO. 6353 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF MILPITAS ADOPTING A TELECOMMUNICATIONS POLICY FOR THE CITY OF MILPITAS WHEREAS, the City of Milpitas "City") perceives the recent advances in telecommunications, including fiber -optic deployment, as the beginning of a new utility which will have social, economic, service and physical impacts on the City and its residents; and WHEREAS, as telephone, cable companies and others use new technologies to make newcservices available, the City must be in a position to take advantage of these new technologies to serve the .public and to ensure that no one in the City is disenfranchised and unable to obtain access to these new technologies; and WHEREAS, the City recognizes the benefits that will accrue to its citizens and businesses as a result of the development of this utility in a fashion that assures open access to a wide range of competitive services for business, citizens and public agencies; and WHEREAS, the public streets, rights -of -way, pole space and other public assets (Public Property) are a limited, finite public resource the use of which is critical to the development of this utility; and WHEREAS, private businesses seeking to use this limited resource for profit should compensate the public treasury for the use of this resource; and j WHEREAS, the City further desires to minimize unnecessary street -cuts which would deteriorate pavement life, create noise and air pollution, and cause traffic interruptions during installation of such infrastructure; and WHEREAS, California cities have traditionally employed their police power to protect the public interest in the use of the public streets. NOW, THEREFORE, BE IT RESOLVED THAT the City adopts the following principals as its Telecommunications Policy to guide the development of a Telecommunications Utility in the City: 1. Minimize disruption to Public Property and ensure efficient use of the City's streets. 2. Ensure reliable telecommunications services at the lowest cost to residents, businesses, and public agencies and institutions in the City. 3. Ensure universal access and interconnectivity to residents, businesses, and public agencies and institutions in the City. -2- 4. Ensure the maximum number and variety of .telecommunications services to residents, businesses, and public agencies and institutions in the City. 5. Enhance the City's economic development programs. 6. Receive fair compensation to the City for the use of Public Property and for City participation in development of a Telecommunications System. 7. Receive appropriate allocation of _telecommunications services, equipment and bandwidth, including spectrum space for police,, fire and City services. NOW, THEREFORE, BE IT FURTHER RESOLVED by the City Council of the City of Milpitas that the City Manager is directed to transmit this resolution to the National League of Cities, the California League of Cities, to state and federal elected officials representing the City of Milpitas, and to mayors and city councils within Santa Clara County. PASSED AND ADOPTED this6th day of Sept. 1994, by the following vote: AYES: (5) Mayor McHugh and Councilmembers Lawson, Lee, Livengood and Skyrud NOES: (0) None ABSENT: (0) None ABSTAIN: (0) None ATTEST: Gail Blalock, City Clerk APPROVED S T FORM: D ejl&s'ervltity Attorney APPROVED: Peter A. McHugh, May AS/20276/G v S 1 .v *''1f��Y VR"•.}c i 'If Y '7'�'+I�'3 y4yV OVA 7 y �XV ILSG INSTITME FOR LOCAL SELF GOVERNMENT A Telecommunications Framework tor Cities Wit <1 ;:'4. i,_ •gyp TI'EM 4,10/5/94 1■ v i =a 0' T 0 Y E a N p E M. I?- Established 4.7 1955 as a non profit, non- partisan and tax exempt 501(c)(3) organization, the Institute for Local Self Government is affiliated with the League of California Cities. ILSG is engaged in research and education to promote and strengthen local self governance. Reports published by the ILSG on the subject of telecommunications include: "Now to Make Telecommunications Work for Your City"— a comprehen- sive syllabus used in workshops J1990),'S25 plus appropriate sales tax "Telecommunications Issues for Local Government" (1990), $10 plus appropriate3ales tax- "A Telecommunications framework for Cities" (1991), $10 plus appropri- ate sales tax r Copies of these reports may be purchased by sending a check payable to the Institute for Local Sell Gavowad-1400 K Street, Suite 400, ,.:.',Pcramento; CA,9St)1d. I N S T I T U T E F R L 0 C A L S E .L F 0 Y E R N M E R T TELECOMMUNICATIONS FRAMEWORK FOR CITIES NOVEMBER 1991 Copyright 1991. All rights reserved. No part of this document may be reproduced without written permission. Institute for Local Sell Government 1400 K Street, Suite 400 Sacramento, CA 95814 (916) 443 -4 136 Supported by funds from the Telecommunications Education Trust established by the California Public Utilities Commission 0 Printed on Recycled Paper I N S T I T U T db F O R L 0 C A L S 1F G O V E R N M E N T A TELECOMMUNICATIONS FRAMEWORK FOR CITIES TABLE OF CONTENTS Foreword...............................:.............: ..............................1 Executive Summary ..............................3 Chapter I Vision of Telecommunications in 2000 .............4 Strategic Telecommunications for the 1990's ......................5 Increase administrative efficiency ..............................5 Develop adequate budgets ....................:.........6 Improve democratic governance ..............................7 Ensure delivery of municipal services ........................7 Reduce air pollution, traffic congestion and Energy consumption ..............................8 Encourage economic development ............................9 Chapter 11- City as Telecommunications User ..................10 Definition............................................. .............................10 Currentstatus .............................10 Trends.................................................. .............................11 Actions: City as User .............................11 Chapter III City as Telecommunications Consumer ........13 Definition............................................. .............................13 CurrentStatus .............................13 Trends.................................................. .............................14 Actions: City as Consumer .............................14 Chapter IV City as Policy Maker .............................16 Definition............................................. .............................16 CurrentStatus ...........16 Trends.........................:........................ .............................16 Actions: City as Policy Maker .............................17 Municipal Policy .............................17 StatePolicy .............................18 FederalPolicy .............................18 League of California Cities .............................18 I N S T I T U T E F O R L 0 C A L S E G O V E R N M E N T FOREWORD Telecommunications technologies and applications offer an important opportunity for cities to cut costs, increase efficiencies and provide new solutions to the cities' critical problems. Many cities am unprepared to utilize the full potential of available telecommunications technologies effectively. Telecommunications can help cities develop innova- tive solutions to the challenges of the 1990's in at least six j strategic areas: A. Increase administrative efficiency B. Help balance budgets C. Improve democratic governance D. Ensure delivery of municipal services, especially to low and moderate income constituencies E. Reduce air pollution, traffic congestion and energy consumption F. Encourage economic development within environ mental constraints This report, "A Telecommunications Framework for Cities," looks at cities from three perspecuves: The city as a Telecommunications user: A city uses telecommunications to provide services and information to the citizenry. For example, a city may cablecast their council meetings, give the community access to public documents using computers, enable interested parties to fax their concerns directly to the Council member or provide low cost data transmission to nonprofit agencies by linking them onto the government institutional network. Telecommunications technologies can provide the city with the means of delivering more services to more people in less Lime for less money. Telecommu- nications permits a city to reorganize how and where these communications are performed and can increase the efficiency of the municipal corporation. The city as a Telecommunications consumer: The municipal corporation routinely "consumes" telecommunications to conduct the business of the city. For example, the city owns, rents or purchases telecommunications services, handsets, building wiring, microwave systems, etc. The city must manage these resources efficiently, must develop effective purchasing procedures and acquire technologies that serve both short and long term needs. 1 I N S.T. I T U T E R L v C A L S E L F M6 O Y E R N M E N T. The city as a Telecommunications policy maker: The city needs to operate at two levels as a policy maker. The city can establish local telecommu- nications policies (for example, the cable TV franchise). It can also use its other police powers to influence the development of telecommunications locally (for example, using its right to regulate land use). Secondly, the city must represent local interests as state and federal agencies redefine the telecommu- nications marketplace. For example, the current debate on the entry of the telephone companies into cable and other information services has had minimal city input. This report is divided into two basic parts: Chapter I discusses telecommunications innovations that cities can employ to respond to the critical issues of the day. Chapters II through IV review the current status of telecommunications, trends within cities and outlines action steps to help cities become more effective users, consumers and policy makers. This policy framework is the result of over two years of work by the Institute for Local Self Government. The ILSG initiated an intensive education program for elected officials and executives in 1989. The program consisted of a series of intensive one -day workshops entitled, "How to Make Telecommunications Work for Your City." The focus of these workshops was on the relationship of telecommuni- cations planning and the existing needs of city officials and its citizens, especially those most dependent on city services. Based upon the research which led to the development of the workshop, input from a panel of telecommunications experts and League of California Cities leadership, an issues paper, "Telecommunications Issues for Local Government" was published'and distributed to all of California's 463 cities. The Institute for Local Self Government is indebted to the League of California Cities Telecommunications Task Force for their important contribution to the preparation of this report. Members include: Jacki Bacharach, Mayor Pro Tem, City of Rancho Palos Verdes (Chair; Shirley Cobb, Public Information Officer, City of Thousand Oaks Stephen Ferguson, Director, Corporate Information Services, City of Oakland Bobbie Landers, Council Member City of Orinda Adelia Lines, Librarian, City of Richmond Dave Mora, City Manager, City of Salinas Gary Orton, Vice Mayor, City of Belmont Linda Perry, Council Member, City of San Leandro Gordon Phillips, City Attorney, City of Redondo Beach Mike Preston, Council Member, City of San Marcos Mike Stover, Assistant City Attorney, City of Lakewood Art Takahara, Mayor, City of Mountain View Howard Zelefsky, Planning Director, City of Huntington Beach Special acknowledgement goes to Kathleen T. Schuler and Walter Siembab, Co-Directors of the ILSG Telecommu- hications Project, for their expertise, commitment and vision and to Daniel Wright, Research Assistant Finally, the Institute for Local Self Government wishes to express its deepest appreciation to the Telecommunications Education Trust which was established by the California Public Utilities Commission to fund telecommunications consumer education projects throughout California. Clark Goecker, Execrative Director 2 1 :I S T I T U T 7 0 R L 0 C A L S E F S 0 V E R N M E N 1 �fE�i1T1VE SUMMARY �Tt'x decade of tl:e i 990' wdl nreseni sonic o(tne Yost c,nlniex and.pressing problems kno »•n to socien. '.../!tnlunitics today Iace cnucai vrobienrs. rronz iundine >>r;a; es and enrironmertai deterioration to housing anal u :ransportatton crtsis. U confront these issues .-ud -tin requires innovation and undaiink of the tried and r. w! t L` 90'r Local telecommunications policies beyond the ::able television franchise are rare, and cable television policy in marry cities fails to address community needs. Federal and state lceislatures and regulatory agencies are changing the rules governing telecommu- nications markets to create competition and spur innovation. These chanties may affect pricing and inay impact long standing public policy, such as universal phone service. Cities lack a coherent, comprehensive pdsiuon on the role of local govern- ments in a competitive telecommunications market- place. J HE RESPONSE :ur.,'.yor►: i.; _aided by ui, pnnriplc oral ,,....,auon.i s1:pIX ?rLS In II( :aUons 111.11 :1_ C11i,s L:::!, !L :,s Ccit t „r n!or, pct ;ic. iE :�'ROBLEAY u(i�_'ct ivaitauons are furcin_ circtcLl clticiais :u ;tiff to Manage existing resources more clfec- :i� anti to seek ailcmauye revenue sources. Ciucs' 1:7ren1 inVesunent in tcleconimunicauons is ::a and Ili z:ro nut lack of ctordinauon ,anom! p ::r'_91LMS resuiu in inefficient utilization of dtcse and a la, k of rlanning i or fuiure needs. 3 '.lunicip'.6 government.; are ;l,c,ndcnt now on :ra;port:auuri :uitt cummum: Lions to :till i :i(ii: ut, ,umnwnit: (:,tk'nu.; Oil the na, C!`Illpm :Ila!n to a „cS; vita! :::formation. I iris reli (`t conimuni wili at inrrcas, ,!:y governmcnts anu citizens alike :rc forced to find altemaUves to automobile truyel. Many cities are unprepared to utilize the full potential of available telecommunications tcchnolo- gies effectively: Current uses are concentrated in a few depart- ments. Therc arc few central resources for planning and implementing new applications. Consumer decisions are often motivated by mistake avoidance rather than meeting currait and future needs. Considcmbon of tcl(- nications applications are inhibited by the lack of knowledge about total telecommunications costs, invested capital and physical plant. Ciucs may implement needed innovations through inore,Ifecuye use of teiecommunicauons. Telecommunica ,)ns supports Innovations uaat can cut costs, increase iciencies and provide ne•.v solutions to cities' critical problems. i he "Telecommunications Framework” is a guide for cl,cted officials and stalf anti outifncs action steps to (a) use telecommunications more cifectiveiy to improve city services, (b) manage total telecommunications investment nmre eiiecuyeiy, and (c) integrate telecommunications into local policies and planning and reguiatory powers. The Framework recommends that cities: Institute comprehensive interdepartmental planning and identify a single entity within the city iut tic authority to monitor and coordinate telecom- munications planning and implementation. a assess current and future communications nceus, not only of the city but of the community. i Develop plans for each municipal function which includes applications of new telecommunica- tions tools from voice processing to video conferencing. Evaluate the total current telecommunications investments and expenses and of vendor evaluation procedures to ensure that a variety of factors (i.e., cas of use, reliability, flexibility) are considered along with price. Examine purchasing options, especially by smaller cities (i.e., regional telecommunications consortia or joint powers agreements). 0 I N S T I T U T E F• R L C C A L S E L F I P O V E R N M E N T Examine revenue options such as fees for value added service, lease of conduit and marketing of excess capacity of city owned telecommunications networks (i.e., institutional networks, radio systems, etc.). Make telecommunications issues explicit in the General Plan so that telecommunications require- ments can be built into new developments (under- ground cabling, information kiosks, telework centers, etc.). Ensure that all present and subsequent telecom- munications franchises require vendors meet local communications needs and satisfies telecommunica- tions plans. Ensure legislative authorization to franchise telecommunications vendors using the public rights of way. Seek funding to support telecommunications planning and development similar to funding. for transportation systems. The Framework further proposes that the League of California Cities continue to play a leadership role in telecommunications issues and legislative policies, and that it seek foundation grants to fund further education, research and development. CHA MR 1. Visions OF TELECOMMUNICATIONS IN 2000 The Framework provides cities with options for performing their roles of user, consumer, and policy maker. A framework for these roles supports the possibility of a unified vision of telecommunications in each city. With a vision, performance in these roles can become a set of mutually reinforcing actions toward a common strategic direction. For example, the Framework can help coordinate the city's purchasing power with the cable television franchise in order to satisfy the communication needs associated with local problems: the city's current expenditures on leased lines for'data communications can be combined with a franchise requirement to allocate bandwidth (or a number of fibers) to the city, enabling the city to develop and support an institutional network for the transmission of data, video and voice. A framework can also guide the city's lobbying position so that federal and state legislation and policies promote the ability of cities to acquire and use telecommuni- cations to address the specific needs of the community (promote competition, protect the cities' interests in cable TV franchising, ensure universal telephone service, etc.). Benefits are derived most directly through use. Therefore, the initial question is, what are the purposes for which a city would use telecommunications? The answer involves the manner in which cities will cope with the future. Therefore, the long run or strategic view of telecommunications depends on answers to two other questions: 1. How will the municipal corporation be structured in 2000 and what functions will it perform? 2. How will the city /metropolitan area/region be structured in 2000 and how will its functions be performed? Answers to these complex questions are, of course, beyond the scope of this report As substitutes for these answers, the League of California Cities strategic plan, I N S T I T U T. E F O R L 0 C A L S E �..F G O V E R N M E N T Action for the 90's, provides a list of strategic actions that must occur this decade in order to maintain an acceptable quality of life statewide. These innovations are our starting point. I ELECOMMUNICATIONS FOR THE 19905 Action for the 90's identified priority issues that must 1;- addressed in order to sustain a reasonable quality of life luring what might be trying times for many people and institutions. The potential contribution of telecommunica- uons to this agenda was demonstrated in tic paper entitled Teiecommunications Issues For Local Government. by the Institute for Local Self Government iLSG) (December 1990). The problems facing cities can be summarized in the ;Ilo�kin_ terms: A faltering private economv, that has already failed to produce an acceptable standard of living for the poorest 20°% of California families, must struggle to regain its strcngdt while complying with increas- ingly expensive environmental constraints. Thcsc include water shortages, air water- building pollution cleanup and prevention programs. and resiliently high per capita Ic% of expensive energy consumption. The public sector, essentially dependent upon tfte private economy for revenue, faces rapidly increasing numbers of young, old, and ethnically diverse people that it must satisfv with municipal services and include in governance. their fundamental organizational characteristics. Large bureaucracies, private and public, are being "downsized" and restructured. Urban designers, environmentalists, transporta- don planners and others arc rethinking land use assumptions and proposing a new, more efficient restructured urban form. Telecommunications can help cities develop innova- tive solutions to the challenges of the 1990's in at least six strategic areas: A. Increase administrative efficiency B. Help balance budgets C. Improve democratic governance D. Ensure delivery of municipal services, especially to low and moderate income constituencies E. Reduce air pollution, traffic congestion and energy consumption F. Encourage economic development within environ- mental constraints A. INCREASE ADMIN1s1RAT1 vE EFRc1ENCY Most cities need to increase efficiency in administra- tion and service delivery, because revenue fails to adequately meet the escalating needs for service. Cities need to become more responsive while: communities are becoming more ethnically diverse, mobility is increasingly expensive and difficult, and Virtually all institutions are faced with re- source shortages, including major airlines, computer manufacturers, philanthropic organizations, educa- tional institutions and governments at local, state and federal levels. While these shortages might be the result of an economic recession, it may be prudent to act as if the condition will, in some degree, last throughout the decade. For example on the expense side, as the environ- ment is priced at its true long term cost, many re- sources such as clean air and water and many practices such as solid waste disposal will all become much more expensive. Additional turbulence in the Gulf Region could suddenly set off another round of energy based inflation. Many institutions have responded to the short term crisis and the long term conditions by rethinking some of local government is having to become more responsible for the city's social conditions. There are at (cast four possibilities: 1. Uncouple and decentralize service production from service delivery. For the most part, municipal services are produced and delivered through a central location such as city hall. A physical decentralization of the municipal corporation would allow some municipal services to be produced closer to where the municipal workers live. This decentralization is accomplished by having some of the workforce work all or part of the time in home offices, regional telework centers (equipped with telephones, fax machines, duplicating machines and other office support and supported by a number of private and/or public agencies), or the public facilities of neighboring cities. Telecommunications re- integrates the off -site workers, tying them to the home office through computers, modems, fax machines and the telephone. "Mode shifted navel" (such as walking or bicycling) or no travel at all reduces the number of I N S T I T U T E F• R L G C A L S E L F ft 0 V E R N M E N T cars on the road, raises the average vehicle ridership and reduces vehicle miles travelled. Some cities are piloting telecommuting projects, especially the City of Los Angeles and other commu- nities in Los Angeles County. Honolulu and surround- ing smaller cities are joining with the private sector in testing telework sites. The Honolulu example may be of special interest to smaller cities that are "housing rich and job poor" or to those cities whose high housing costs require most municipal workers to commute long distances. 2. Deliver service as close to the point of consump- tion as possible. Now municipal information is provided primarily by a city worker talking to a constituent, either on a face- to-face basis or over the telephone. Some of this information delivery can be automated and distributed using automated telephone systems (interactive voice response phone systems, audiotext), home computers and public kiosks (videotext) and fax networks. These systems can be designed to provide information in several foreign languages 24 hours a day at a relatively low cost over the public telephone network or through local munici- pal networks (such as an institutional network). Utilizing these delivery systems would improve the city's responsiveness to its constituents as well as reduce the number of vehicle trips and vehicle miles to access municipal services. Since end users would be engaged in "co- producing" the service (compa- rable to a person accessing banking services using an Automated Teller Machine or ATM) and more people can be served, the cost to the city of producing the service would decrease. 3. Use network services to increase the productiv- ity and /or the effectiveness of the city work force. Voice mail, e-mail and video conferencing can all increase productivity. Norfolk, Virginia, estimates that it saves $25,000 a month through the use of e- mail. The City of Auburn, Washington, (population 33,000) faced gridlock manually issuing and tracking 25 different kinds of permits in five different offices. Callers waited hours for status reports on permits. With the new automated system and less staff callers get responses while still on the phone, and the city maintains current parcel information through a link to the county's assessor's office. Improvements in mobile telecommunications continue to dramatically increase effectiveness of police and fire departments. Such improvements would prove equally effective with parks and recre- ation, public works, building inspections and other field personnel. 4. Provide direct access to information without personnel. Information on status of permits, city services, eligibility for programs such as welfare or health, council meetings, recreation program registra- tion, etc. are being provided now cuing municipal channels, 24 hour "information kiosks," and voice directed phone systems. B. DEVELOP IIDwum BUDGETS Adequate budgets can be realized in two general ways. Costs can be reduced or revenue can be rased. Telecommu- nications can contribute to both. Cost reductions can occur in three ways. 1. Telecommunications can be used more exten- sively in service delivery (making information more readily available to the public, offering services closer or in the home, etc.) and in administration (use of e- mail and voice mail, electronic "filing cabinets" to reduce storage and increase access to records, etc.) to increase overall productivity as discussed above. For example, an electronic filing cabinet system now on the market can automatically scan, index, and store 130,000 pages (or a three to six drawer filing cabinet) on one 14" disk. The documents can be accessed by multiple users simultaneously. 2. The costs of telecommunications can be more effectively managed to ensure a least cost technical solution: interdepartmental planning, centralized oversight and purchasing, compatible interdepartmen- tal computer systems, local area networks, etc.. City officials often mistakenly believe that their city's current telecommunications expenses are insignifi- cant, because expenses are usually embedded in department budgets and total telecommunications costs are frequently unknown. 3. Inter -city cooperation could enable smaller cities to share in the costs of telecommunications applications that would otherwise be unavailable to a single municipality. Small cities now enter into joint powers agreements for a wide variety of services, including cable television. County governments and local fie and police agencies have been the leaders in developing joint projects, such as computerized geographic information mapping systems. These systems permit a number of localities or agencies (for example, planning departments, fire and police, transportation) to share a common in -depth database on a given area. The Portland Metropolitan Commu- nications Commission manages an institutional network on behalf of 14 small communities in addition to portions of the County. I H S T I T U T .r F O R L 0 C A L S E F G 0 V E R N M Revenue can raised in two ways. 1. Private telecommunications markets can be required to generate consumer tax revenue. franchise fees or business taxes. These and other onuons to increase "regulatory revenue" through a spectrum tax, for example) are discussed more fully in Chapter iv. Many cities own one or more telecommunications resources: radio, microwave and/or insutuuonal networks (INET), underground conduits, etc.. In some cases, excess capacity on these resources can be leased to other public and nonprofit entities or to the private sector. Opportunibes include leasing _itannei capacity from die city's poruon oi,the cable !NET, selling switching services to small businesses city hall, selling transmission capacity: from the s private nctwork(s), basing space m cif•; owned ::td,r _round conduit to telecommunic ;aions vendors. fomh. Cities could also include nonprofit grantees of the its tin leased services to -mail and voice mail, fur :x ;unpic) at minimal cost. For example. tine City of incinnau includes punlic and private sctuxnfs. hospiLais, and United Way agencies on its I NET, -_h rL only ti)r hookup. Tl:cre are soine barriers to this more cntrcureneur- ::1 approach. Cities must invest to a certain level of ;,ct:ni,al expertise. And. local governments are rmctimes reluctant to provide services normally in domain of die private sector. I lowevcr, there are :1recedcnts. Cities routinely charge tic private sector use public rights of way or to use city m%ncei ;Ilduit_s. The ll::dc (:runty Offiec of Comnuter S,:r•ices and Informabon Systems (CSIS) is sell 1::pponing by Icasinu voice and data lines on its INET otlrcr county and state agencies and a nonprofit hospital. After obtaining permission from the state to rc -sell value added public information, CSIS also delivers such information to the private sector for a fee. Other ciucs and counucs are adding non- goycmmental agencies to their INETs, because increasing the number of users of the system de- creases the per user costs. C. IMPROVE DEMOCRATIC GOVERNANCE Govcmance problems have at least two dimensions: reports. official policy documents, policy outcomes a nd so forth. Delivery of this information is compli- cated when many constituents do not speak English, or have mobility problems due to age or income. Language translation capabilities can be acquired from the State of California or commercially fora per minute fcc over a telephone equipped with conierencing capabilities. Video coverage of city council and commission meetings can be distributed over the cable television government channel. Public notices and staff documents can be distributed over electronic mail networks such as Santa Monica's PEN and accessed by computers and telephone (State of Hawaii). Inter -city cooperation -,%hick could diminish the need for regional agencies that frequently infringe on local self determination. Communication is necessary to improve inter -city ctxnperauon in regional issues. Growth management, transportation, crime prevention and economic development are all examples of issues which require such cooperation and significant inter -city communi- cations. Audio and video conferences, c -mail, and data and graphics communications available to city representauyes, neighborhood organizations and the public could decrease the cost and improve the ,ffe:uvencss of public decision making in these regional issues. One of the most likely areas for potential inter -city coopernuon may in fact be Joint development, planning and management of telecommunications systems (ex., tic Portland Metropolitan Communica- ti,xts Commission coordinates a 14 community INET; a five city joint powers agreement for cable TV franchising in tic Palo Alto area; Reno and Washoe County project to build a six mile fiber network). A ENSURE DELIVERY OF MUNICIPAL SERVICES, ESPEa4uy TO LOW AND MODERATE INCOME CONSTITUENTS AND TO THOSE KM LIMITED MOBILITY. Action for the 90's predicted that cities will need to accept increased responsibility for social conditions that involve safe neichborhoods, citizen participation, health care, cultural diversity, recreation and youth and senior programs. I. Effective participation by residents in munici- Many cities now use their municipal channels to pal decision making. Every city has extensive provide mul6language information to non English speaking responsibilities for providing information to the residents, to teach literacy skills, deliver special exercise public. These include mecung notification, staff programs to the frail elderly. Some school districts keep home bound students "in school" through live, interactive I N S T I T U T E D R L 0 C A, L S E L F G O V E R N M E N T video instruction using INETS, interactive channels on the cable system or their instructional television fixed systems (ITFS). Other communities have linked local health clinics to major hospitals through fax networks to improve the level and speed of diagnoses. As the demand for municipal services expands, the unit cost of producing services must be decreased. Service costs can be decreased through increasing productivity of the work force, by reducing the cost of the technical overhead (i.e., better management of telecommunication costs) and by facilitating end user co- production with the city of some services.. For example, Neighborhood Watch is a recent innovation that engages community members in co- producing neighborhood safety. Many municipalities have initiated Neighborhood Watch programs on the municipal cable channel. Other approaches to safety could include equipping neighborhood watch groups with more powerful communications and more timely police information (linking them on the e-mail system, for example). Similar organizational innovations can be applied to other services. All information and transactions that can be provided through the public telephone network, cable television or ATM -like kiosks engage the constituent in co- production of the service., Valuable municipal labor can be freed to engage in more productive activities. Increased work force productivity, more efficient administration and reduction of telecommunication costs have been discussed above. E. REDUCE AIR POLLUTION, TRAFRC CONGESTION AND ENERGY CONSUMPTION WITHOUT STOPPING THE PHYSICAL DEVELOPMENT NECESSARY TO ACCOMMODATE THE GROWTH PROJECTED FROM NATURAL INCREASE AND IMMIGRATION. Action for the 90's states that innovation will be needed in order to protect the quality of life as the popula- tion increases by 6 million people in the 90's and ap- proaches 40 million by 2020. Local governments will have to provide affordable housing, natural resources, infrastruc- ture, waste disposal/recycling and open spaces while minimizing the environmental costs. A reduction in air pollution, traffic congestion and energy consumption means less vehicle miles travelled in personal automobiles that use fossil fuels for the journeys to work, shop, recreate and to acquire services. This reduction can be accomplished by re- organizing single occupant into multiple occupant trips through ride sharing, shifting the mode of travel to mass transit or some non polluting mode such as bicycles, or eliminating the need for the vehicle trip altogether. The ride sharing option tends to be relatively expen- sive and has not yielded satisfactory results, at least without significant penalties for driving alone. Van pooling cur- rently requires a subsidy of $60 a seat per month in Los Angeles. The key to the second and third of these options is shortening the distances that must be. travelled for any activity (journey to work, etc.) to as close to zero miles as possible for as many people as possible. Neo- traditionalist urban designers such as Peter CalEhorpe and Andreas Duany are developing new principles to guide physical development away from. built -in transpor- tation needs associated with suburban sprawl. They are using higher residential densities with co- located retail and employment opportunities. They design to accommodate the pedestrian and discourage the automobile by, among other things, narrowing sweet widths. This approach provides the so- called jobs housing balance that will greatly reduce the need for transportation. But such physical (re)development will most likely be too expensive and provide too little too late. The time and cost constraints suggest that some sort of retrofit of the existing physical environment will be necessary. Innovations in both institutional organization and the function of land will have to occur. As described above, the municipal corporation as well as most other employers in a city will need to decentralize the production and the delivery of services and products. Not only must the commute of municipal workers be induced through telecommuting, telework centers and so on, but the services of the city must be brought closer to the user. Information kiosks can be placed in libraries (Santa Monica's PEN) or in Laundromats (Community Memory in Berkeley), shopping malls can house satellite city halls (Honolulu) and a citizen can receive information and file forms through the nearest fax machine (Oakland). Videoconferencing and training over ][NETS and community channels can reduce travel and save time. In both realms, new communication needs will be created, and an array of new telecommunication services will be required. 47 I N S T I T U T F a n L 0 C A L S E F G O V E R N M E N T F. ENCOURAGE ECONOMIC DEVELOPMENT WHIN THE ENVIRONMENTAL CONSTRAINTS. Cities need to develop local and regionai economics to ;:rovide iobs to residents and contribute tares to the local �ovcmment. The most prized iobs arc high paying and often mound in the information services sector. The State of l iawaii, for example, has an unemployment rate of under but the maiority of the available jobs arc low paid (food and hotel service, for ex.). The need to develop alternative, utter paving employment opponunitics is one factor driving the State's siznificant investment in telecommunications %%*hich includes a statewide microwave backbone for voice, data and video communications and 1NETs on each island. city and county governments— where success at solving traffic congestion problems, maintaining low taxes with high service levels and reducing per capita energy consumption may become prerequisites for economic growth An economic development strategy based on telecom- munications would incorporate the following: T�Iccommunicadons can contribute to economic (i:vclonment in only one way. however effective use by ac I.(xal organizations, institutions and entrepreneurs that (1) :cake tin the current economic base, and are kev to r: _cnerann2 the economic base in the lone term. `.lanv telecommunications advocates urge develop ntent of new infrastructure as insurance for success in the infonmation economy. The problem is, infrastructure without clients prepared to Use it Will lead to nothine except the t.mporary jobs needed to build it. The existence of con .:ructcd. but unutilized, institutional networks, vacant ommunity cable TV channels and dormant instructional t.lcvision systems ITFS) are evidence of this problem. In fact, in the mid 80's the FCC released unused but valuable ITFS channels for commercial use and allowed nonprofit hi cnsc holders to (case unused channel time to commercial vendors. Lc act of usint telecommunications to lxcome a :imre citicicnt and effective crcanizabon %viii produce 1:.nnc► its. The kev organizations in anv community include: Stan -up and other small businesses educational institutions including universities, colleges, community colleges, primary and secondary public schools, vocational schools and specialized schools or associations that offer continuing education for professionals libraries business resource organizations such as chambers of commerce, downtown business associa- tions, or tourist bureaus Use. Ensure that the key institutions are cost effec- tively using the telecommunications tools currently avail- able. The biggest barriers to expanded utilization are insurance of need, inadequate management of current use and inability to plan and manage new applications. Train- ing, education and comprehensive planning are the best tactics to improve use. Markets. High market prices are often the next barrier to use. If needed services (as determined in 1.) are ne affordable. regulatory action to control prices or direct provision by the public actor to increase supply are the best tactics to improve use. Telecommunication markets are also "market- places" in that telecommunication firms hire labor some of it should be local), and telecommunications facilities and services offer new kinds of opportunities for other entrepreneurs (900 numbers for example). Infrastructure. Prices may be high, because there is insufficient capacity. Or needed services may not be available, because the telecommunications plant has not been modernized. Infrastructure is rarely the key.problem now for economic development although it will probably become more of an issue in the post divestiture environmen For example, the much touted 1SDN and video conferencin over phone lines will be available in the central business districts of maior cities long before they reach the rest of th county. It is deficiencies such as these that may require an investment in infrastructure. Cities are beginning to make that investment by building their own networks or requiring them in their cable franchise agreements. convention centers, airports or sea pons (found in large cities) social service and other nonprofit organizations providing vital community services I N S T I T U T E F•R 1 0 .0 A L S E L F• 0 V E R N M E N T CSR ll. Ci7y AS USER DERNlTIt7N The city as a telecommunications user: A city uses telecommunications to provide services and information to the citizenry. For example, a city may cablecast their council meetings, give the community access to public documents using computers, enable interested parties to fax their concerns directly to the Council member or provide low cost data transmission to nonprofit agencies by linking them onto dtc government institutional network. Telecommunications technologies can provide the city with the means of delivering more services to more people in less time for less money. Telecommunications permits a city to reorganize how and where these communications are performed and can increase the efficiency of the municipal corporation. CURRENT STATUS Telecommunications use is relatively concentrated in a few departments. The distribution of resources has created telecommunication haves and have -nots. The resources in any given city might follow the following h,podtctical distribution: THE HAVES Police and lire departments. Public safety has the longest tradition of telecommunications use, because a) such services require mobility and arc delivered near their point of consumption (i.e., beat patrol or the site of a crime or fire), and b) their services are generally urgently needed, and response time is an important factor. As a result police cars are virtually mobile nodes in a complex voice and data network using radio and microwave frequencies. The next gcncration_of hand held radios will make the individual field officer a mobile node in the network, able to access many of the same voice and data services available now only in the police car. Fire departments have many of the same characteris- tics as police deployment except that a) fine service units are larger, and b) fire requires high levels of continuous class- room training. Fire trainers tend to be the most advanced in- house users of video for one way lesson distribution and interactive video conferences. THE 1wRMEDIATEs Transportation, computing (perhaps finance), libraries, public works and city council. Public works is a traditional user like fine and police due to the dispersal of facilities and the mobile nature of the services. But, the problems created by remote maintenance yards and rolling stock require only modest investments in radio and micro- wave. Transportation and computing departments are comers. Significant aspects of the transportation mission have become depcndcnt on communications. Transportation system management techniques from traffic signal control to smart corridors require two way data communications between individual intersections and central control. In the extreme case, Los Angeles is developing a $50 million demonstration project named Automated Traffic Surveillance And Control System ATSAC). ATSAC will construct a fiber optic telecommunications system capable of transmitting video images and high speed data from dozens of freeway locations and intersections to a central ground control facility. A series of computer controlled freeway information signs and a low power AM radio station will communicate with drivers. Furthermore, transportation demand management techniques such as ride sharing rely on computers, local area networks and the public switched network in order to match and respond to drivers' requests. Libraries, having embraced automation in the 70's, havcinitiatcd a range of projects to bring the library into the classroom, the home and the work place using phone and computer access (Pasadena, and Knoxville, Tennessee to name two). Kem County library, with a grant from the phone company, now serves the residents of the 8000 square mile county with three bookmobiles which are connected to the library's mainframe by packet radio systems. Computing departments have a short history of sharing resources on a mainframe or mini computer with remote terminals connected over dedicated lines (hierarchical model). Beyond a certain threshold of terminals, this led to the well known "spaghetti farms" of wire clogged ducts. The explosion of desk top computing during the 1980's led to the development of communication based computing known as the client service model. Within this model, a set of stand -alone computers are connected to become a network of computers which then evolves into a computing. network with a variety of special purpose nodes. Costs of computing have tumbled with the adoption of desk top. computers. Ultimately, computing departments (under the hierarchical model) are the fast users of data circuits on a city -wide backbone network, however it is defined The 10 I N S T I T U T E 0 R L 0 C A L S E 1, S 0 V E R N M E N T iient server model is often developed quietly by end user .:.partments through local area networks (LAWNS). Once a ::::rtain number is retched, communications between the L:�Ns usually over the city network 'or leased lines is rcuuircd. Many city councils now.cablecast their public Hicetinus. Someare using electronic mail, voice mail or fax nc_Lworks" to lacilame communications with individual ronsutucnts. THE TRAILERS City manager, planning, and recreation and parks. "rho city manager often has either high levels of central ompuung support or a developed local area network, and iaev are used for electronic mail and management intonma- -:um systems. ii Inning dcpan.ncnts h ave become increasingiv :,t.:restea in mapping soitwire and goo -based information stems. In some cases, internal sharing and remote access utcse resources has begun to occur. Somc recreation and parks departments became ,ommunicauons users by cablecasting softball games and bier recreation events with video prouucuon resources and .:r;; -ovemment channei available throu_h the cable tclevi- :mi iruichisc. THE HAVE -HOTS Social services, aging. community development, _ontroller, and city attornev. This group includes depart- :;tents that arc overwhelmed by their tasks and cannot muster rte resources to consider using new tools, despite 1 ;::ir dcsperatc mood for better communications. It also includes departments that simply have never had a tradition ,f communications or high technology use. However, the League's CITYLLNTK, along with a variety of other informa- bon providers, are developing special databases (legislative tracking, municipal code updates, etc.) for city attorneys and onher specialized city departments equipped with a computer and a modem. In summary, municipal corporations tend not to have ucpartments responsible for directing strategic changes and/ or for forecasting and planning for the city's future needs for telecommunications. Individual departments, therefore, fend for themselves. As a result, a few departments, like fire and police, acquire powerful capabilities while most do not. TRENDS The trend is to reinforce the existing hierarchy of resource distribution. This happens in two ways: a Most cities do not have a central department to facilitate the organizational strategies of all other departments. As a result only those departments with intemai expertise to plan, budget, and implement new telecommunications systems and, therefore, have the resources to innovate in service delivery. is Telecommunications vendors develop and market innovations primarily to those departments with expertise and, therefore, with budgets. As a consequence, departmental innovation in service production has generally been slow. Telecommuting, for example, plays a very small roic to date. And, the vendors are reluctant to develop applications for local government hen existing demand is low. Department innovation in service delivery has not only been slow but tends to be limited to isolated special projects. Use of the government cable channel for distribution of public information varies dramatically between cities: few cities have institutionalized their use of video. There has hccn little apparent experimentation with information kiosks or other terminal types for the distribution of public informa- tion. Using these public terminals or home computers to transact business (i.e.. to receive and file forms, to obtain permits, etc.) has been even slower. Voice messaging and c -mail have begun to appear inside municipal corporations for the purpose of increasing staff productivity. Interurban video confcrencing remains unknown despite its successful demonstration by the National Science Foundation in the late 70's and by the private sector. ACTIONS C17Y As TELECOMMUNICAi/0NS USER: (Please note: Although the action steps for the "City as User" and "City as Consumer" are separated out for purposes of discussion, the steps outlined are closely related and should be incorporated in any comprehensive planning process.) 1. For both "City as User" and "City as Consumer" the first action step is to set up a planning group that: has high level commitment, has clearly defined responsibilities, has the necessary authority to complete the tasks and can involve all city departments. For example, the City Manager could appoint a Steering Committee of key department heads to direct and coordinate the planning effort and to ensure that 11 I N S T I T U T E F R L 6 C A. L S E L F 0 V E R N M E N T. participants receive the necessary training. The Committee could involve two task forces to provide information to the Committee, to educate staff, and to develop department plans. One task force, made up of directors responsible for service delivery, could focus on "user" needs #2 and #3 below), while a technical task force could work on the actions outlined under "City as Consumer." 2. Identify the short, mid- and long term communication needs of the municipal corporation and of the community and the barriers to meeting those needs. It is important to go beyond the status quo in identifying these needs. Note that technology solutions can be found only after the communi- cation needs have been identified. 3. Given the needs and barriers, identify specific organiza- tional innovations. Some of those identified include: a. Physical decentralization of production and delivery of city services. b. Fees for service with value added services. c. Public co- production of municipal services. d. Strategic change in the mission of certain depart- mcnts b. Annual goals for each department to implement those organizational innovations that have the highest priorities. c. Annual capital budgets to acquire the network tools and technologies that satisfy the initial communi- cations needs of each department (see Consumer, #4). The tools might include: i. Voice processing ii. Electronic mail iii. Video conferencing. 6. Establish a permanent mechanism for institutionalizing telecommunications planning and implementation for all departments. The options include: a. An inter departmental committee b. Planning capacity within each department c. Central city -wide planning capacity. It is critical that the authority and responsibility for planning and implementation be clearly delineated, ideally with one entity. e. Cooperation among institutions in the same city f. Formation of consortium or JPAs between neighboring cities or between cities and county agencies. Once these innovations arc identified, strategics for the city as a whole and for individual departments can be developed. 4. Based on these strategics, determine the communication needs for the municipal corporation as a whole and for individual departments. Determine in particular the commu- nication requirements to the home and to neighborhood institutions. 5. Convert the needs into implementation plans. The plans should incorporate necessary education and training of key city staff. Implementation plans include: a. Long range development of the municipal network that includes such opportunities as the renewal of the cable franchise, enforcement of other telecommunications franchises ,municipal capital developments, special projects and grants, etc.. 7. Seek funding for these activities from a variety of sources: a. Savings from becoming a more effective telecom- munications consumer and more efficient organiza- tion. b. Resources acquired from land developers, franchised telecommunications vendors and federal programs (see policy maker actions). c. Revenue from telecommunication enterprises (including value added services, lease back of portions of the network) d. Seek partnerships with private vendors e. Build communication components into city proposals for outside funding. 12 I N S T I T U T 1 F O R L .0 C A L S E F G O V E R N M E N T CHAKER lll: 1�1TYAS CONSUMER DERNITION 'rhe city as a telecommunications consumer: The ;aunicipal corporation routinely "consumes" telecommuni- auons to conduct the business of the city. For example, the city owns, rents or purchases telecommunications services, :and. s, building wiring, microwave systems, etc.. Tlie city must manage these resources efficiently, must develop effective purchasing procedures and acquire technologies :::at serve moth short and lone term needs. Centrex is a switching service offered by Pacific Bell and GTE which is subscribed to by many municipal governments. Voice, video and data traffic usually nrn over distinct physical plants. For example, the public telephone network maybe used for external communications and the municipal microwave channels used to carry internal voice communi- cations while video goes out over the cable tv network and data over local area networks or dedicated terminal to mainframe telephone wires. Fleeted officials and city staff are often uncomfortable making purchase decisions. They tend to either support proposals because of staff expertise or oppose proposals because of expense or perceived risk. Individual departments frequendy plan, develop and build independent mini telecommunications systems. CURRENT STATUS Ever, city "consumes" a wide variety of tclecommu- :,.cationsproducts and services. The following list provides few examples of network components and subsystems t; pically used by municipal governments. PBX or Centrex Inside wiring Telephone instruments F :Lx machines Data ncuvorks Traffic siunal wiring Government cable channel Cable production equipment Public safety dispatch Voice mail boxes Paging devices Cellular telephones In some cases, a city owns the component outright and provides for its maintenance and replacement. The public safety dispatch system is an example. Or it leases equipment such as telephone instruments. In other cases, a city simply subscribes to the services of a vendor who owns and maintains the technology. z Traffic sis control systems are usually planned and operated by the transportation depart- mcnt, The emergency dispatch system is controlled by the police department, The maintenance yard microwave system is the responsibility of public works, Data networks are installed by the computer department and finance department with other departments frequently building bootleg local area networks for their desk top computers. Duplicative and/or incompatible systems frequently result. Total capital investment and annual operating costs are very seldom known by anyone in city government. City Councils approve developments piecemeal as part of department budgets. And effective management and cost control of.the city's existing telecommunications invest- ments are difficult to achieve. This fragmentation of responsibility defeats the strategic objective of acquiring services at least cost. It is difficult to guarantee security or to ensure that there will be available capacity for future services. However, centralized planning and interdepartmental coordination can lead to comprehensive purchasing guidelines that ensure least cost expansion to meet future needs or that maximize short tetra flexibility. In other words, with no single department in charge of telecommunications a city is unable to effectively plan, develop or manage telecommunications resources. The municipal corporation cannot use its consumer role to influence the market or to fully develop and utilize its resources. 13 I N. S T I T TRENDS E 9 R L 0 C A L S E L FOG 0 V E R N M E N T Some cities arc developing departments of telecom- munications and/or initiating intcrdcpartmcntal planning efforts (example, San Leandro and Oakland). Others are acquiring municipal facilities as a way of decreasing telephone costs, adding video capabilities and increasing flexibility either by building the system or by having it built as pan of the cable TV franchise. For example, fifteen small cities northeast of Portland entered into a joint agreement to have a 500 mile [NET constructed by their common cable provider and managed by central communications division. San Francisco and San Diego County have both dedicated departments and private networks. Los Angeles has initiated a study of a private network. However, even in these jurisdictions, the integration of voice, video and data has not occurred. Counties arc taking the lead in local government telecommunications innovation, driven by budget cuts and die ceogrtphic dis=cos thev must serve. Some manage INETS constructed by the cable company which serve not only county agencies but schools and cities (Montgomery County, Maryland). Dade Cuunty, Florida, created a county wide ner.vork incorporating its existing microwave and coaxial cable and operates the communications system as a profit center. Counties across California are developing geographic mapping information systems shared by a number of departments or by county and city agencies. The largest public sector entity in the State, the State of California has taken a private network a step further. CALNET has built a telephone network and is selling capacity on dtis state wide network to cities and counties throu(hout die state. This makes the State of Califomia a. lone distance provider. As mentioned, cities can also become providers to product revenue or provide in -kind subsidies to community orvanizations who serve the public interest, such as commu- -1y colleges, transportation management organizations and ial service agencies. A new industry has emerged to audit the telephone bills of largcprivate and public sector consumers. Telephone auditors review the last three years of bills for errors and overcharges in exchangefor a portion of the savings identi- fied. S uch assistance is a small but significant step toward helping improve municipal man agement of telecommunica- tions costs. Substantial cost savings, service responsiveness and revenue are the benefits of these trends. However, to gain these benefits a city must develop a core of expertise. While it appears that size may be an important qualifying criteria, medium or even small cities need not be excluded from these benefits. It does suggest regional cooperation through consortia may be required. As the Portland [NET and many county telecommunications projects demonstrate, such intercity or city county cooperation can bring needed expertise and economies of scale to California's smaller cities. Amoms CITY AS TELEcommu i:477 S CONSUMER (Please refer to "City as User" for a description of a proposed planning process. These are some of the activities that would be completed by the technical task force.) 1. Local governments currently own, rent, or lease an extensive telecommunications network: PBX or Centrex, voice and data lines, inside wiring, terminal equipment, traffic signal wiring, video security systems, government cable channel, microwave to city maintenance yards, radio dispatch, paging devices, etc.. Set up a technical task force to identify the elements of the city's existing telecommunications networks: a. Identify existing network components, costs and invested capital on a department by department basis. b. Analyze current telecommunications costs, which might be available on a city -wide basis only. C. Determine alternatives to contain costs for the existing level of service. That is, determine whether city has purchased the least cost solutions to the existing communication needs and is managing its resources efficiently. 2. Assign the responsibility for designing, develop- ing, managing and maintain the city's future telecom- munications network based on the identified needs (sec User, #2). a. Evaluate the departments' applications plans to determine their facilities needs, ensuring that the strategic plans of each department are satisfied. b. Determine whether to integrate or keep separate the voice, video and data responsibilities. c. Determine whether to assign the responsibility to particular dcpartment(s) that have the appropriate budget and necessary expertise or to create a city- wide department. -1 i 14 I N I T I T U T E F O R L 0 C A L S E .:f G O V E R N M E N T 3. Review the procedures used to evaluate vendors' proposals to determine whether they are suited for purchasing high technology. Least cost criterion is no longer the most effective.. Expandability, ease of use, features, maintenance, reliability, compatibility, availability and level of vendor training and support may be more important than initial cost. 4. Develop a capital budget that reflects the telecom- munications strategy (see User, #3). a. Purchase equipment that facilitates the adopted organizational strategies. For example, lap top computers with modems may not only make field personnel more efficient, but may.permit more staff members to work at home. b. Evaluate the business case for building a telecommunications facility in the local business loop. c. Develop the required physical facilities. For example, a new city hall may not serve as well in the future as a number of public offices and transaction kiosks connected via the city network. 5. Evaluate the formation of a regional consortium through a joint powers agreement, for example, with neighboring cities or with the regionally dominant city or county organization. As precedent, cities and ci6zcns have bcnefitted greatly from JPAs formed for insurance purposes. A consortium might be formed to cut costs, develop resources too costly for one city, share existing technologies, develop compatible standards (for police communications, for example) and to aid one another in becoming more effective consumers. Small cities, in particular, may find that inter -city cooperation is the only vehicle to develop some telecommunications applications. 6. Evaluate local markets and the revenue benefits to be gained from selling telecommunications services, either commercially or as a matter of public policy to particular groups. Telecommunications enterprise funds (similar to those established for water, sewers, airports, and so on) may provide the means of supporting new applications. Dade County, Florida, for example, has set up its communications depart- ment as an enterprise fund using department charge backs, lease of services to other government agencies and selling of value added information services. 15 I N S T I T .0 T E R L O C A L S E L F GOVERN M E N T CSR IV: Cirl As Poucy MAKER DERN177ON The city as a Telecommunications policy maker: The city needs to operate at two levels as a policy maker. The city can establish local telecommunications policies (for example, the cable TV franchise). It can also use its other police powers to influence the development of telecommuni- cations locally (for example, using its right to regulate land use). Secondly, the city must represent local interests as state and federal agencies redefine the telecommunications marketplace. For example, the current debate on the entry of the telephone companies into cable and other information services has had minimal city input. CURRENT STATUS Cities have regulatory authority over only one telecommunications industry cable television. State and Federal government have authority over all others at the present Lime: 1. Because of the necessity of a national plan for spectrum allocation, the Federal Communications Commission (FCC)has sole substantive regulatory control over spectrum based communications indus- tries including broadcast radio and television, mulupoint microwave television, and satellites including direct broadcast satellites. 2. Interstate long distance telephone voice and data communications carried by wire, fiber, microwave or satellite communications are regulated by the FCC under the authority of the Interstate Commerce Clause of the U.S. Constitution. 3. Intrastate long distance and local telephone voice and data transmission is regulated by the California Public Utilities Commission. The parameters of local authority over cable television are set out in the Cable Communications Act of 1984. This Act basically reduced the scope of city regulatory powers over cable television. The franchise agreement is the local cable policy instrument, but it is seldom based on local communications policy or on long term community needs to provide for the future communications needs of the city and the community. Often, community needs are defined simply in terms of access channels, and the franchise agreement is borrowed substantially from a neighboring city. Cities, of course, have domain over the physical development of the city including related social and eco- nomic concerns. There are also corporate and police powers necessary to promote the health, safety and general welfare of the public. Telecommunications developments are closely related to these concerns, but the connections between them are rarely made in policy and practice. TRENDS As with the user and consumer roles, the absence of centralized telecommunications responsibility within the municipal corporation insult in telecommunications policy being a low priority. There is one exception cable television, and it has been neither innovative nor strategic. Due to the deregulatory effects of the 1984 Cable Act, many cable consumers nationwide have complained to their local franchising authorities about escalating rates and declining service quality. In California this increase in rates was felt even earlier, because rate regulation was removed from California cities by the State legislature in 1979. As a result, many city representatives have asked the federal government to provide consumer relief by either a) encouraging competition to cable operators, or b) returning rate regulatory authority to cities. This push constitutes the trend in city telecommunications policy. The response has been draft federal legislation aimed at partial re- regulation of the cable industry. The future of federal re- regulation legislation will be affected by the Federal Communications Commission's announcement of somewhat stiffer new standards for "effective competition." Under this policy, limited rate regulation would be returned to cities where there is no effective competition from other multichannel video providers (a second cable company, direct broadcast satellite or wireless cable) or there are less than six over the air signals. Approximately 60% of all cable systems and 30% of the country's subscribers may be affected. Also in this congressional session, the "Communica- tions Competitiveness and Infrastructure Modernization Act" has been introduced to encourage telephone companies to invest the estimated $500 billion necessary to provide fiber optic transmission to every home in America by 2015. The incentive for this investment is the telco's right to deliver video entertainment in its own market area initially as a common carrier. This is known as the video dial tone proposal. Conversely, this proposal also invites cable companies to provide basic telephone service and personal communica- 16 I N S T I T U T! F O R L 0 C A L S E F G O V E R N M E N T tions services (PCS) in competition with the telephone that will be very difficult to replace. These subsidies may industry. Cox Cable San Diego, for instance, has already come under attack if competitors succeed in gaining market applied for a license to provide PCS. I share at cable's expense. Giving an additional push to the telephone companies was Judge Green's July 1991 ruling that lifts the prohibition on the Bell operating companies provision of information services. If the ruling is upheld by an appellate court, Bell companies will be able to provide electronic banking, shopping, yellow pages, classified ads, messaging and so on as well as build cable systems outside their local service areas. It is competition, of course, that is the trend in all telecommunications markets. Cities should be aware that revisiting partial cable rate regulation is a temporary political expedient awaiting an avalanche of competition. Technological innovation has led to the situation where the computer (data), telephone (voice), and cable (video') industries are all developing the same high capacity, high speed, switched communications capabilities. As a result, industry boundaries arc dropping, and free for all compeuuon is occurring. The communications policies of both the United States and die State of California are encouraging free market entry and open competition in order to. increase consumer choices and to improve the competitive position of the United States in the international arena. One result of compctiuon is that the prices for a service are being adjusted to approach the actual cost of producing it. This is a radical departure from the history of tclephone service in the United States. For the last fifty ycars complex internal subsidies manipulated prices in order to achieve the goal of universal service: Long distance rates were increased over cost to subsidize local service rates that were kept artificially low. rates Business service rates subsidized residential Urban user rates subsidized rural (or low density) rates As these subsidies are removed, questions remain about the future of universal telephone service and about equal access to advanced services. Cable television has also provided service subsidies in the form of resources and channel capacity for public, education and government access. Additionally, cable vendors pay a franchise fee that "competitors" do not pay. While these subsidies and fees are small in the context of the investment in cable plant, they have provided cities and communities with a community network (access channels), interconnects to schools, institutional networks and funding In summary, the current trends are toward increasingly i competitive markets, a breakdown of industry boundaries, federal/state elimination of the municipal role in telecommu- nications regulation, and lack of direction for the develop ment of local telecommunications policies. ACnoa CRY AS POLICY MAKER In light of current law and policy trends cities should formulate their policy positions following some general guidelines: Local policy should not restrict entry into the market. For example, a cable TV franchise must be non exclusive both in the language of the ordinance and in the process used to award franchises. Regulation should be applied uniformly. A new entrant into the market place must have the requirements as an incumbent. Policy should encourage and not restrict new technologies. The basis for the city's role in telecommunications policy is that: All markets operate imperfectly. As with housing or transportation markets, telec- ommunications markets create "haves" and "have nots." There are frequently market abuses, which tend to affect the lower income or less educated consumer disproportionately. When the marketplace fails, the insults are felt locally. When the housing market fails, it is the city that must deal with homelessness, for example. MUNICIPAL POLICY. L Document and analyze the communication needs of the significant sectors of the community. These include: a. The municipal corporation (see User, #2) b. Key local institutions such as public secondary schools, vocational schools, community colleges, libraries and hospitals. C. The public, particularly low income or informa- tion deprived households and the organizations that serve them. 17 I N S T I T U T E F R L^ C A L S E L F 0 V E R M M E M T d. Special interests that reflect community goals such as small business as an economic. develop- ment strategy. 2. Re- evaluate the policies that underlie the land use and circulation elements found in the General Plan. Most cities have unconsciously adopted a land form that requires extensive use of private transportation in order to function. A communications strategy would build special telecommunications facilities into each new regionally significant development and would structure land use so that local mobility needs can be satisfied by walking, bicycling, shorter per car trips, and a variety of public transit alternatives. 3. Develop a telecommunications component for each element of the General Plan., This harmonizes the General Plan policies with telecommunications concepts and maintains the State requirement that each element reinforce every other element. The following are options for formal policy adoption: a. Amend the municipal codes to include telecom munications infrastructure enhancements for appropriate new developments. There is a tradeoff between telecommunications and the load on existing infrastructure and city services. b. Include telecommunications strategies as traffic mitigation options in new development agreements. c. Add telecommunications objectives and/or programs to existing elements of the General Plan such as land use, circulation, economic develop- ment and air quality. d. Add a telecommunication element to the General Plan. e. Add telecommuting to any air quality and/or congestion management plan mandated by the State or required by city ordinance. 4. Ensure that all telecommunications franchises the city becomes authorized to issue, as well as the cable television franchise, satisfy local needs and reinforce the urban strategy (as stated in the General Plan and reflected in air quality and other programs of the city). STATE PoUCY. City interests would be served by the following amendment to State law: Ensure legislative authorization to franchise telecommunications vendors using the public rights of way. FEDERAL POUCY.' City interests would be served by the following positions on Federal policy: I. Maintain cable television franchising authority with the powers now in the Cable Act as a minimum. 2. Seek federal funding to support telecommunica- tions planning similar to support for transportation planning. The basis for this funding is the improved municipal functio economic stimulation to domestic telecommunications industry. Promote a I% fee to be charged all commercial users of the spectrum for use by cities in planning, developing, managing and using telecommunications. 3. Join national associations advocating municipal interests in telecommunication policy as a vehicle for influencing federal policy and legislation. LEAGUE of CAuFoRAIIA CmEs. 1. Develop and expand the scope of the Telecommu- nications Task Force as the vehicle for providing the League of California Cities with leadership in the telecommunications arena. 2. Assert leadership in research and development in municipal telecommunications applications, by developing, for example, a funding base from founda- tion grants. 3. Educate its members about and develop positions on telecommunications issues as they emerge in the legislative and regulatory arenas. 4. Implement telecommunications practices where feasible. S. Identify opportunities and barriers for effective municipal use of emerging telecommunications applications. 18