Judges: W.A. DREW EDMONDSON, Attorney General of Oklahoma
Filed Date: 6/15/1999
Status: Precedential
Modified Date: 7/6/2016
Dear Representative Wright,
¶ 0 This office received a request for an official Attorney General Opinion from your predecessor, Representative Don Weese, addressing, in effect, the following questions:
1. May a charter municipality authorize a company, without avote of the people, to provide telecommunications services to thepublic pursuant to its existing franchise, which is a franchiseto own and operate a system for the manufacture, transmission,distribution, and sale of electricity to the municipality and thepublic generally, without violating the provisions of Article
2. Is a company that provides telecommunications services to thepublic required to obtain a franchise to operate within theboundaries of a municipality under Article
3. Is a franchise to provide telecommunications servicesassignable without being subject to the voting provisions ofArticle
4. Since 1987, a company has been paying a fee for the use of aright-of-way for its telecommunications business pursuant to therate established under its electric franchise rather than the$0.75/per foot rate that other companies are charged under apermitting system. Is this a proper charge, and if not, is themunicipality required to collect the proper right-of-way userfees from 1987 to the present?
¶ 2 The term "franchise" has been defined by the Oklahoma Supreme Court as "a right or privilege granted by the sovereignty to one or more parties to do some act or acts, which they could not do without this grant from the sovereign power." SouthMcAlester-Eufaula Telephone Co. v. State,
¶ 3 Article
No municipal corporation shall ever grant, extend, or renew a franchise, without the approval of a majority of the qualified electors residing within its corporate limits, who shall vote thereon at a general or special election; and the legislative body of any such corporation may submit any such matter for approval or disapproval to such electors at any general municipal election, or call a special election for such purpose at any time upon thirty days' notice; and no franchise shall be granted, extended, or renewed for a longer term than twenty-five years.
Okla. Const. art.
¶ 4 Accordingly, a franchise may not be issued without assent from a majority of the qualified voters who vote in an election and the extent of "the authority thus granted [by the voters] islimited by the terms of the proposal and the franchise ordinanceso submitted at the election." City National Bank v. Kiowa,
¶ 5 The question presented indicates that the voters of a municipality granted a franchise to an electric company in compliance with this section, and then at some later date, the city officials authorized the electric company to begin providing telecommunications service in the municipality without a vote of the people. Whether the municipality's act exceeded its authority depends, in part, on the terms of the franchise proposal and ordinance approved by a majority of the qualified electors.
¶ 6 In this question, the franchise approved by the electors grants the holder the right to use the streets and ways of the municipality for the purpose of owning and operating a systemand plan for the manufacture, transmission, distribution, andsale of electricity in and to the municipality and the publicgenerally. In general, franchises are strictly construed and, if the meaning of a grant or contract regarding any public franchise is doubtful or ambiguous, it will be construed favorably to the rights of the public. Huckins Hotel Co. v. Southwestern BellTelephone Co.,
¶ 7 By its express terms, the franchise described in this question grants the holder only the right to provide electric service to the municipality and the public generally. Because the right to provide telecommunications service is not expressly authorized and because that right cannot be necessarily implied, any action by the municipality to authorize provision of telecommunications service pursuant to that particular franchise exceeds its authority. Accordingly, the municipality may not authorize the company to provide telecommunications services pursuant to its existing electric franchise without violating the provisions of Article
Every railroad, oil pipe, car, express, telephone or telegraph corporation or association organized or authorized to do a transportation or transmission business under the laws of this State for such purpose, shall, each respectively, have the right to construct and operate its line between any points in this State, and as such to connect at the State line with like lines; and every such company shall have the right with its road or line, to intersect, connect with, or cross any railroad or such line.
Okla. Const. art.
¶ 9 The Oklahoma Legislature executed this provision through its enactment of Title 18, Section 601 of the Oklahoma Statutes. Specifically, that section provides:
There is hereby granted to the owners of any telegraph or telephone lines operated in this state the right-of-way over lands and real property in this state, and the right to use public grounds, streets, alleys and highways in this state, subject to control of the proper municipal authorities as to what grounds, streets, alleys or highways said lines shall run over or across, and the place the poles to support the wires are located; also the right to condemn and cross over or under, or build their lines along any railroad property or right-of-way, subject to the necessary use of such property or right-of-way by the railroad company; the right-of-way over real property granted in this section may be acquired in the same manner and by like proceedings as provided for railroad corporations.
18 O.S. 1991, § 601[
¶ 10 Thus, a "telephone or telegraph corporation or association" organized or authorized to do a transmission business in Oklahoma has the right to construct and operate its lines between any points in this State, subject to the control of the municipality as to what grounds, streets, alleys, or highways the lines run over or across, as well as where the poles to support the wires are located.
¶ 11 These provisions have been interpreted to limit municipal control over the operations of telephone and telegraph companies.In City of Tulsa v. Southwestern Bell Telephone Co., the court held that these provisions superseded the provisions of Tulsa's charter which required that a franchise be obtained prior to use of the city's streets and alleys for the construction or operation of a telegraph line or telephone system. City of Tulsav. Southwestern Bell Telephone Co.,
¶ 12 Similarly, the Oklahoma Supreme Court has held that a municipality lacks the power to grant a franchise to a telephone or telegraph company where the right to use the public streets for the operation of its business has been granted to the company directly by the Constitution or by the Legislature. SouthMcAlester-Eufaula Telephone Co. v. State,
In such case the rights obtained from such municipality, by a telegraph or telephone company, would be very valuable and would likely be a good consideration for any reasonable promise or agreement, as to rates to be charged for telephone or telegraph service, or in other regards, that such company might make. Not so, however, in this state, or in any state where the right of use of the public ways is given directly to the company from the sovereign by express legislative grant, and there is only given to the municipality the power of police and the right to agree upon and fix the manner of such use. . . . So, if we are correct so far, it would seem to follow that . . . a municipality has no valuable right to confer on a telephone company; nothing, in fact, that the law would regard as a consideration. . . .
Id. at 968 (citation omitted).
¶ 13 Because "telephone or telegraph corporation[s] or association[s]" have been granted the right to use the public streets and grounds in Oklahoma by the Constitution and by statute, municipalities do not have the power to require these types of companies to obtain a franchise prior to using the public streets and ways.1 A municipality may not prevent a "telephone or telegraph corporation or association" from operating within its boundaries, but may only exercise control as to what grounds, streets, alleys, or highways the company uses in the conduct of its business. City of Tulsa,
¶ 14 The question presented, however, relates to the authority of the municipality to authorize a company to provide "telecommunications services" within the city. The Oklahoma Telecommunications Act of 1997 defines the term "telecommunications" to mean "the transmission, between or amongpoints specified by the user, of voice or data information of the user's choosing, without change in the form or content of the information as sent and received." 17 O.S. Supp. 1998, §139.102[
¶ 15 The Oklahoma Supreme Court explicitly recognized this inData Transmission Company v. Corporation Commission, in which it held that a specialized common carrier that utilized microwave transmissions to provide private line telephone service was a transmission company within the meaning of Article
¶ 16 Thus, the legality of operating a telecommunications company in a municipality without a franchise under Article
¶ 17 A telecommunications company affected with a public interest, which is not a "telephone or telegraph corporation or association," is required to obtain a franchise to operate from the municipality in accordance with Article
¶ 19 However, this general rule is not applicable to a "telephone or telegraph corporation or association" because the rights granted by Article
¶ 21 For example, the question does not describe the method by which one telecommunications company was authorized to pay the same rate established by its electric franchise. Further, if the rate paid by the other companies was charged pursuant to an ordinance, the precise language of the ordinance would have to be examined, and the timing of the ordinance's passage in relation to the authorization of the different rate by the municipality would have to be determined. In addition, the validity of the fee ordinances and authorizations under the state and federal Constitutions and the federal Telecommunications Act of 1996 would have to be decided. Resolution of these issues involve questions of fact which are outside the scope of an Opinion of the Attorney General. 74 O.S. Supp. 1998, § 18b[
¶ 22 It is, therefore, the official Opinion of the AttorneyGeneral that:
1. A municipality may not authorize a company to begin providingtelecommunications services to the public pursuant to a franchisegranted in accordance with Article
2. If a telecommunications company constitutes a "telephone ortelegraph corporation or association" under Article
Whether any particular telecommunications company is a"telephone or telegraph corporation or association" within themeaning of Article
3. A telecommunications company that obtains a franchise inaccordance with Article
4. Whether a telecommunications company paid the proper feerequired by law turns on several questions of fact which cannotbe answered in an Opinion of the Attorney General. 74 O.S.Supp. 1998, § 18b(A)(5).
W.A. DREW EDMONDSON ATTORNEY GENERAL OF OKLAHOMA KELLY HUNTER BURCH ASSISTANT ATTORNEY GENERAL