[1] St. Louis v. Western Union Tel. Co., 148 U.S. 92 (1893); Postal Tel. Cable Co. v. City of Newport, 76 S.W. 159 (Ky. 1903); Western Union Tel. Co. v. City of Richmond, 224 U.S. 160 (1912); Postal Tel.-Cable Co. v. City of Richmond, 249 U.S. 252 (1919); Loretto v. Teleprompter Manhattan CATV Corp., 458 U.S. 419 (1982).

[2] Postal Tel. Cable Co. v. City of Newport, 76 S.W. 159, 160 (Ky. 1903) (citing St. Louis v. Western Union Tel. Co., 148 U.S. 92 (1893) and Postal Tel. Co. v. Baltimore, 156 U.S. 210 (1895)).

[3] St. Louis v. Western Union Tel. Co., 148 U.S. 92 (1893); Postal Tel. Cable Co. v. City of Newport, 76 S.W. 159 (Ky. 1903); Western Union Tel. Co. v. City of Richmond, 224 U.S. 160 (1912); Postal Tel.-Cable Co. v. City of Richmond, 249 U.S. 252 (1919); Loretto v. Teleprompter Manhattan CATV Corp., 458 U.S. 419 (1982).

[4] 10A EUGENE MCQUILLIN ET AL., THE LAW OF MUNICIPAL CORPORATIONS ß 30.39.10 (3d ed. 1990).

[5] 10A id. ß 30.39.

[6] See, e.g., Tex. Rev. Civ. Stat. Ann. art. 1175(2), 1181 (West 1994). But see, e.g., Pacific Tel. & Tel. Co. v. City of San Francisco, 336 P.2d 514 (Cal. 1959) (rights to a telephone franchise are granted directly to the franchisee pursuant to state law).

[7] City of Tulsa v. Southwestern Bell Tel. Co., 75 F.2d 343 (10th Cir.), cert. denied, 295 U.S. 744 (1935). The states that are mentioned in City of Tulsa that could collect franchise fees in 1935 are: Illinois, Tennessee, Colorado, Connecticut and South Dakota. The ones that the court notes could not charge a fee are: Kansas, Wisconsin, Iowa and Oklahoma. But see AT&T v. Village of Arlington Heights, 620 N.E.2d 1040 (Ill. 1993) (disallowing city franchise fees pursuant to state law on a non-local fiber optics cable line).

[8] St. Louis v. Western Union Tel. Co., 148 U.S. 92 (1893); Fleming v. Houston Lighting & Power Co., 138 S.W.2d 520 (Tex. 1940), cert. denied, 313 U.S. 560 (1941); City of Springfield v. Postal Tel.-Cable Co., 97 N.E. 672 (Ill. 1912); Lewis v. Nashville Gas & Heating Co., 40 S.W.2d 409 (Tenn. 1931); Nashville Gas & Heating Co. v. City of Nashville, 152 S.W.2d 229 (Tenn. 1941). Compare Diginet, Inc. v. Western Union ATS, Inc., 845 F. Supp. 1237 (N.D. Ill. 1994) (construing franchise fees as "taxes") with Robinson Protective Alarm Co. v. City of Philadelphia, 581 F.2d 371 (3rd Cir. 1978) (allowing that under state law franchise fees were "rental," but under the federal "Tax Injunction Act" they were taxes).

[9] See, e.g., Alpert v. Boise Water Corp., 795 P.2d 298 (Idaho 1990). This case provides an excellent contemporary analysis on the nature of a franchise and authority to charge a franchise fee. Id. at 304-07.

[10] Id. See also City of Jamestown v. Home Tel., 109 N.Y.S. 297 (N.Y. App. Div. 1908); City of Mitchell v. Dakota Central Tel. Co., 127 N.W. 582 (S.D. 1910).

[11] St. Louis v. Western Union Tel. Co., 148 U.S. 92, 100-01 (1893).

[12] Pensacola Tel. Co. v. Western Union Tel. Co., 96 U.S. 1, 9 (1878). The Supreme Court characterized the early telegraph service as follows: "The electric telegraph marks an epoch in the progress of time. [It has] become one of the necessities of commerce. It is indispensable as a means of inter-communication, but especially is it so in commercial transactions." Id.

[13] Loretto v. Teleprompter Manhattan CATV Corp., 458 U.S. 419, 428-30 (1982).

[14] While telephone companies argued they had the same rights as telegraph companies under the federal statute, that argument was rejected in Richmond v. Southern Bell Tel. & Tel. Co., 174 U.S. 761 (1899).

[15] 14 Stat. 221 (1866). Cf. City of Toledo v. Western Union Tel. Co., 107 F. 10 (6th Cir. 1901). In a narrowing of what the telegraph companies could use the "post roads" for, the court opined that the federal statute only authorized a telegraph company to use the post roads for interstate business and that it did not grant the right to use the roads for a "district" telegraph operation, i.e., local business. Id. at 14-15. See also City of Memphis v. Postal Tel. Cable Co., 145 F. 602 (6th Cir. 1906); Mayor of Nashville v. Cumberland Tel. & Tel. Co., 145 F. 607 (6th Cir.), cert. denied, 203 U.S. 589 (1906).

[16] 148 U.S. 92 (1893).

[17] Id. at 100.

[18] Id. at 100-01.

[19] Id. at 105.

[20] 149 U.S. 465 (1893).

[21] Id. at 470.

[22] 224 U.S. 160 (1912).

[23] Id. at 169. The last significant case of this series was in 1919, in which the Court tersely disposed of the issue of compensation. In Postal Tel.-Cable Co. v. City of Richmond, the Court concluded: "Even interstate business must pay its way--in this case for its right-of-way and the expense to others incident to the use of it." 249 U.S. 252, 259 (1919).

[24] 458 U.S. 419, 428 (1982).

[25] Id. at 438-40.

[26] Id. at 438 n.16.

[27] Id. This same thought was expressed another way in Southwestern Bell Tel. Co. v. Webb, 393 S.W.2d 117 (Mo. Ct. App. 1965). The telephone company argued that the placement of telephone cable on the private landowner's property did not give rise to compensation as "'not one single iota of defendant's land was actually taken.'" Id. at 121 (quoting appellant's final complaint). To that argument, the court tersely replied: "If no land has been taken, where is the cable?" Id.

[28] See, e.g., St. Louis v. Western Union Tel. Co., 148 U.S. 92 (1893); Western Union Tel. Co. v. City of Richmond, 224 U.S. 160 (1912); Postal Tel.-Cable Co. v. City of Richmond, 249 U.S. 252 (1919).

[29] 10A EUGENE MCQUILLIN ET AL., THE LAW OF MUNICIPAL CORPORATIONS ß 30.39.10 (3d ed. 1990).

[30] Pub. L. No. 98-549, 98 Stat. 2779 (codified as amended in scattered sections of 47 U.S.C. (1988)).

[31] Pub. L. No. 98-549, ßß 621-27, 98 Stat. at 2786-94 (codified as amended at 47 U.S.C. ßß 541-47).

[32] See American Civil Liberties Union v. FCC, 823 F.2d 1554, 1557-63 (D.C. Cir. 1987), cert. denied, 485 U.S. 959 (1988) (reviewing the history of cable television jurisdiction between local governments and the FCC).

[33] Pub. L. No. 102-385, 106 Stat. 1460 (codified in scattered sections of 47 U.S.C. ßß 521-611 (Supp. IV 1992)).

[34] 47 U.S.C. ßß 521-611 (1988 & Supp. V 1993).

[35] 47 C.F.R. ß 76.31 (1983).

[36] 47 U.S.C. ß 542 (1988 & Supp. V 1993).

[37] 47 U.S.C. ß 542(b) (1988).

[38] 148 U.S. 92 (1893).

[39] 458 U.S. 419 (1982). See also TCI of North Dakota, Inc. v. Schriock Holding Co., 11 F.3d 812, 815 (8th Cir. 1993), in which the Circuit Court in dicta discusses the possible Constitutional problems of the 1984 Cable Act taking "undedicated" property. It also cites a number of other circuit court opinions which discuss this same issue. Id. Of course, the Cable Act provides for a 5% fee as compensation. 47 U.S.C. ß 542(b) (1988).

[40] 47 U.S.C. ß 541(a)(2) (1988 & Supp. V 1993).

[41] Cable Invs., Inc. v. Woolley, 867 F.2d 151, 159-60 (3rd Cir. 1989); Cable Holdings of Georgia v. McNeil Real Estate, 953 F.2d 600, 609 (11th Cir.) cert. denied, 113 S. Ct. 182 (1992); Media Gen. Cable v. Sequoyah Condominium Council, 991 F.2d 1169, 1175 (4th Cir. 1993); TCI of North Dakota, Inc. v. Schriock Holding Co., 11 F.3d 812, 815 (8th Cir. 1993); Century Southwest Cable Television v. CIIF Assocs., 33 F.3d 1068, 1071 (9th Cir. 1994).

[42] See City of Los Angeles v. Preferred Communication, Inc., 476 U.S. 488, 495 (1986) (holding that a cable television franchise does raise First Amendment issues, but leaving open the extent of governmental regulations and the standard of judicial review pending further development of the facts at the trial court); Leathers v. Medlock, 499 U.S. 439 (1991) (upholding an Arkansas general sales tax on cable television revenue against a First Amendment challenge, even though the print media had been exempted from the tax); Telestat Cablevision, Inc. v. City of Riviera Beach, 773 F. Supp. 383, 406-07 (S.D. Fla. 1991) (upholding franchise fees against a constitutional attack, as long as they were related to the costs of administration and to the fair market value of the public rights-of-way); Chicago Cable Communications v. Chicago Cable Comm'n, 678 F. Supp. 734 (N.D. Ill. 1988), aff'd, 879 F.2d 1540 (7th Cir. 1989), cert. denied, 493 U.S. 1044 (1990) (holding it was not a First Amendment violation to assess a contractually agreed upon fine on a cable operator for violation of the cable agreement); Erie Telecommunications, Inc. v. City of Erie, 853 F.2d 1084 (3rd Cir. 1988) (without reaching the constitutional issue, holding that franchise fees were an essential part of the franchise contract, which were supportable as a term of the contract, because the payments were rent for commercial use of the public rights of way); Group W. Cable, Inc. v. City of Santa Cruz, 669 F. Supp. 954, 974-75 (N.D. Cal. 1987) (holding that they would uphold franchise fees which were reasonably based on the fair market value of the property and administrative costs). But see Century Fed., Inc. v. City of Palo Alto, 710 F. Supp. 1559 (N.D. Cal. 1988) (holding that a franchise fee violated the First and Fourteenth Amendments where the City of Palo Alto did not charge all users of the rights-of-way a franchise fee, and those that were charged, had different charges).

[43] 773 F. Supp. 383 (S.D. Fla. 1991).

[44] Id. at 406 (emphasis added).

[45] 710 F. Supp. 1559, 1568-78 (N.D. Cal. 1988).

[46] Id. at 1576. A 2% fee was charged the gas & electric company and a 5% fee was charged the cable operator. Id.

[47] See, e.g., St. Louis v. Western Union Tel. Co., 148 U.S. 92 (1893); Goldberg v. Sweet, 488 U.S. 252 (1989).

[48] 488 U.S. at 267-68 (upholding a state tax on telephone interstate access fee charges).

[49] Id. at 262-63.

[50] See, e.g., Incorporated Town of Hemstead v. Gulf States Utils. Co., 206 S.W.2d 227, 230 (Tex. 1947). See generally 6 EUGENE MCQUILLIN & JOHN D. LATTA, THE LAW OF MUNICIPAL CORPORATIONS ß 20.53 (3d ed. 1969); 12 EUGENE MCQUILLIN & CHARLES R. P. KEATING, THE LAW OF MUNICIPAL CORPORATIONS ß 34.45 (3d ed. 1986).

[51] 101 S.W. 770 (Tenn. 1907).

[52] Id. at 774-75.

[53] Id.

[54] Id. at 774.

[55] 174 U.S. 761 (1899).

[56] Home Tel. Co. v. Mayor of Nashville, 101 S.W. 770 (Tenn. 1907). See also Postal Tel. Cable Co. v. City of Newport, 76 S.W. 159, 160 (Ky. 1903), in which the court specifically said that "the [placement of telegraph] poles and wires in the streets are a serious servitude [on the public property], and . . . [the telegraph company] could not impose this servitude upon the city, thus taking its [the city's] property without compensation."

[57] See Michels v. Times Mirror Cable TV of Louisville, Inc., No. 85-CA-1081-MR (Ky. Ct. App. Jan. 31, 1986), cert. denied, 484 U.S. 890 (1987); C/R TV, Inc. v. Shannondale, Inc., 27 F.3d 104 (4th Cir. 1994).

[58] Michels, No. 85-CA-1081-MR, slip op. at 2; C/R TV, 27 F.3d at 108.

[59] 27 F.3d 104 (4th Cir. 1994).

[60] Id. at 108-09.

[61] Id. at 109 ("The transmissions of a telephone company are virtually indistinguishable from transmissions of a non-telephone company transmitting television signals for purposes of a pole and wire easement grant."). See also Greater Worchester Cablevision, Inc. v. Carabetta Enters., Inc., 682 F. Supp. 1244 (D. Mass. 1985); Michels v. Times Mirror Cable T.V. of Louisville, Inc., No. 85-CA-1081-MR (Ky. Ct. App. Jan. 31, 1986).

[62] General Tel. Co. v. FCC, 449 F.2d 846, 855 (5th Cir. 1971).

[63] Id. at 860.

[64] Telephone Co.-Cable Television Cross-Ownership Rules, 7 F.C.C.R. 300 (1991) (first report and order) [hereinafter Preliminary Video Dialtone Order].

[65] Telephone Co.-Cable Television Cross-Ownership Rules, 7 F.C.C.R. 5781 (1992) (second report and order, recommendation to Congress and second further notice of proposed rulemaking) [hereinafter First Video Dialtone Order].

[66] 33 F.3d 66 (D.C. Cir. 1994).

[67] Id. See generally Preliminary Video Dialtone Order, supra note 64; First Video Dialtone Order, supra note 65.

[68] National Cable Television Ass'n, 33 F.3d at 70-73. In 1991, Preliminary Video Dialtone Order, supra note 64, at 330, and in 1992, First Video Dialtone Order, supra note 65, at 5822-23, the FCC had reached the same conclusion.

[69] Preliminary Video Dialtone Order, supra note 64, at 306.

[70] Id. (emphasis added).

[71] Telephone Co.-Cable Television Cross-Ownership Rules, 7 F.C.C.R. 5069, 5070 (1992) (memorandum opinion and order on reconsideration) (emphasis added).

[72] See, e.g., Jeannine Aversa, Phone Firms Avoid Paying for Cable, THE LEGAL INTELLIGENCER, Aug. 29, 1994, at 9; Jube Shriver, Jr., Telephone Firms Don't Need Local Franchise For Video, L.A. TIMES, Aug. 27, 1994, D at 01; Jon Van, Phone Firms Free Of Franchise Costs, CHI. TRIB., Aug. 27, 1994, Business, at 3; No Franchise Needed In Video Cable Service, THE NATIONAL LAW JOURNAL, Sept. 12, 1994, at B 4.

[73] See Jeannine Aversa, Phone Firms Avoid Paying for Cable, THE LEGAL INTELLIGENCER, Aug. 29, 1994, at 9; Jube Shriver, Jr., Telephone Firms Don't Need Local Franchise For Video, L.A. TIMES, Aug. 27, 1994, D at 01; Jon Van, Phone Firms Free Of Franchise Costs, CHI. TRIB., Aug. 27, 1994, Business, at 3; No Franchise Needed In Video Cable Service, THE NATIONAL LAW JOURNAL, Sept. 12, 1994, at B 4.

[74] Preliminary Video Dialtone Order, supra note 64, at 330.

[75] First Video Dialtone Order, supra note 65, at 5822-23.

[76] 33 F.3d at 70-73.

[77] In re Telephone Co.-Cable Television, CC Docket No. 87-266, 1995 FCC LEXIS 396 (Jan. 20, 1995).

[78] Preliminary Video Dialtone Order, supra note 64, at 302; see also id. at 324-25 and 330.

[79] First Video Dialtone Order, supra note 65, at 5822-23.

[80] Id.

[81] Id. (emphasis added).

[82] Id.

[83] Id. at 5072 (emphasis added).

[84] National Cable Television Ass'n v. FCC, 33 F.3d 66, 72-75 (D.C. Cir. 1994).

[85] Id. at 71-72.

[86] Id. at 72.

[87] Id. at 75 (quoting FCC v. Midwest Video Corp., 440 U.S. 689, 707 (1979)).

[88] National Cable Television Ass'n, 33 F.3d at 73-74.

[89] Id. at 71 (citing H.R. Rep. No. 934, 98th Cong., 2d Sess. (1984), U.S.C.C.A.N. 1984, p. 4655) (emphasis added).

[90] H.R. 3626, 103d Cong., 2d Sess. ß 302(a) (1994) (amending 47 U.S.C. ß 201(c)(3)) ("Preemption . . . [N]o State or local government may . . . effectively prohibit any person or carrier from providing any interstate or intrastate telecommunication service or information service, or impose any restriction or condition on entry into the business of providing any such service.").

[91] H.R. 3636, 103d Cong., 2d Sess. (1994) (This bill was reported out of the House Committee with several new amendments. One was to exclude the "new" telecommunications revenue from the franchise fee base of the cable television franchise. Another amendment required "local franchise fee parity." If those two amendments had both been applied, current franchise fee charges on telephone franchises could have been challenged.).

[92] S. 1822, 103d Cong., 2d Sess. ß 230(a) (1994) (". . . [N]o State or local statute or regulation, or other State or local legal requirement, shall prohibit or have the effect of prohibiting the ability of any entity to provide interstate or intrastate telecommunication services.").

[93] H.R. 411, 104th Cong., 1st Sess. (1995) (amending scattered sections of 47 U.S.C.).

[94] Id. ß 302(a), (b)(1), (b)(2) (1995).

[95] Id. ß 302(a) (amending 47 U.S.C. ß 201 by adding subsection (c)(3)) (emphasis added).

[96] Id. ß 302(a) (amending 47 U.S.C. ß 201 by adding subsection (c)(3)(B)(i)).

[97] Id. ß 302(a) (amending 47 U.S.C. ß 201 by adding subsection (c)(3)(C)).

[98] Id. ß 302.

[99] Id. ß 401.

[100] Id. ß 302(a).

[101] Id. ß 659(a)(3).

[102] Id. ß 659(b)(2).

[103] Id. ß 302(b)(1) (amending 47 U.S.C. ß 541(c)).

[104] At the time of final publication of this article there recently has been a Senate Bill, S. 652, 104th Cong., 1st Sess. (1995), introduced by Senator Pressler. That Senate Bill appears to address some of the issues raised in the article with regard to the parity issue of franchise fees. As presented, it allows "competitively neutral" franchise fees to be applied to both cable television operators providing telephone service and telephone companies providing cable service, i.e., both "new" sources of revenue being subject to franchise fees. Id. at ß 201(a) (amending 47 U.S.C. ß 254(c)).