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redlining in telecommunications
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Date: Thu, 17 Mar 1994 23:17:42 -0500
From: James Love
Distributed to TAP-INFO, a free Internet Distribution List (subscription requests to listserver@essential.org)
TAXPAYER ASSETS PROJECT - INFORMATION POLICY NOTE March 17, 1994
Anti-Redlining Amendment Added to Cable/Telco legislation
james love (love@essential.org; 202/387-8030 or 610/658-0880)
On Wednesday, March 16, the full Energy and Commerce Committee held a mark-up session on HR 3626 and HR 3636, two bills which will substantially rewrite the nation's communications laws. This note provides some background on one amendment which was offered by Representative Bill Richardson (D- NM), and adopted by the full committee. The purpose of this note is both to discuss the amendment, and to illustrate how the network of citizen groups who are members of the Telecommunications Policy Roundtable work together to influence the NII legislation.
The amendment deals with the issue of "redlining" in the new Video Platform broadband networks provided by telephone companies. Richardson's redlining amendment requires the FCC to adopt regulations which would prevent telephone companies from excluding areas from their Video Platform service area on the basis of the ethnicity, race or income of the residents.
Video Platform services are multimedia networks that will be provided by telephone companies in the same service area where they presently provide telephone service. Early this month, the Consumer Federation of America (CFA), the Center for Media Education (CME), Essential Information, and TAP began a study of redlining in the 20 so called "video dialtone" applications the telephone companies have filed with the FCC. These groups noted that the initial service areas for the new services were small, and appeared to be narrowly targeted to high income communities. One New England Telephone Company proposal, for example, included West Hartford, a very wealthy community, but excluded Hartford, which is a lower income community with a significant minority population. Some proposals were very specific, including only a few apartment buildings.
TAP circulated some suggested language for HR 3636 to deal with this issue. Representative Bill Richardson's staff indicated on Monday afternoon that the Congressman would be interested in doing something on the problem. After wider discussions, the language was redrafted by Richardson. and information about the amendment was more circulated among some members of the Telecommunications Policy Roundtable. By Wednesday, nine groups (CFA, CME, People for the American Way, Libraries for the Future, TAP, the Black Coalition on Voter Participation, the Center for Policy Alternatives, the United Church of Christ Department of Communication, and the Communications Task Force of the National Council of Churches) endorsed the Richardson anti-redlining amendment.
Meanwhile, two news stories were shaping the debate on the mark-up in different directions. A story in monday's issue of Communications Daily indicated that the Regional Bell Operating Companies (RBOCs) were threatening to "pull away" from the legislation, because they were unhappy with changes in the legislation that had emerged from the earlier mark-up at the Telecommunications and Finance Subcommittee. Communications Daily attributed this to "strong campaigns by long distance industry and consumer interests," which were shifting the "balance" of the bill away from Telco interests. Whether this was a ploy or not is hard to say, but several members of the Committee indicated that they didn't want to do anything that would further jeopardize the telephone companies' support for the bill.
On Tuesday, however, the Wall Street Journal ran a page one story, detailing the RBOCs' massive lobbying efforts, and their willingness to play political hardball, by bankrolling opponents in member districts. The Journal article seemed to shift sentiment against the RBOCs, at least somewhat.
Chairman of the Energy and Commerce Committee, Representative John Dingell (D-MI), was responsible for managing the mark-up on HR 3626 and HR 3636. His staff opposed the inclusion of the redlining amendment, on the grounds that it was appearing too late in the process, but Richardson insisted on offering it during mark-up. On the day of the mark-up committee staff raised some additional questions about the need for the amendment, and asserted that it would be redundant and unnecessary, given current communications law. That set off a scramble to find out what if anything was in the Communications Act that dealt with redlining in Video Dialtone services.
Andy Schwartzman, a communications lawyer and the longtime director of the Media Access Project, provided some advice for the proponents of the amendment on extremely short notice, despite other demands on Andy's time, such as another amendment on the reallocation of HDTV spectrum. Because of his extensive knowledge of communications law and the legislative process, public interest and industry groups often use Andy as a sounding board or advisor on a wide range of issues, as was the case for the redlining amendment. In this case Andy located someone else who had recently examined the issue, the answer seemed to be that once a telephone company wires a community, anyone can hook-up (an issue that was not in dispute), but that they telephone companies did not have a clear affirmative obligation to wire certain communities, or build out the system into certain neighborhoods. [The key issue concerned Section 202 of title 47, which prohibits a common carrier from "subjecting any particular person, class of persons, or locality to any undue or unreasonable prejudice or disadvantage."]
Michael Ward from TAP also contacted a number of other Roundtable members, asking what they know about current regulatory or statutory provisions on video redlining. This connected Michael with Tony Pharr, who represents the United Church of Christ and the Communication Task Force for the National Council of Churches. It turned out that Tony had prepared an analysis of the Ameritech video dialtone proposal for Illinois, which was announced by Ameritech with great fanfare on January 27, 1994.
The Ameritech proposal involved 28 communities in Illinois. For the State as a whole, 75 percent of the population is white and 25 percent is non-white. However, in the 28 communities that are included in the Ameritech proposal, 22 had minority populations less than 25 percent, and 18 had minority populations less than 10 percent. In only 1 of the 28 communities did non- whites constitute a majority of the residents. In 26 of the 28 communities the median household income was higher than the median income for the state as a whole. The median household income for the entire state of Illinois in 1990 was $32,252. The average 1990 median income for the 28 communities in the Ameritech proposal was $46,337.
On the same day Ameritech announced its digital video network for Illinois, it also announced a special program to connect elementary and secondary schools to advanced communications capabilities.. Ameritech President Richard C. Notebart indicated that "schools should be among the first 'information haves' as this nation moves into an era of interactive communication." According to Pharr, the two communities in Michigan selected for tests of this program included Warren and Birmingham, which have populations which are 96 and 97 percent white.
Ultimately, the preliminary analyses by CFA, CME, TAP and Pharr provided a strong empirical case that a stronger legal mandate against redlining was needed.
Richardson went ahead and offered his redlining amendment , which was adopted as part of HR 3636. The amendment expands a section that defines the rules that must be adopted by FCC for the Video Platform services, by asking the Commission to adopt a regulation which will prohibit redlining. The text follows:
On Page 52, line 34, insert the following new subsection:
"(G) prohibit a common carrier from excluding areas from their geographic service area on the basis of the ethnicity, race or income of the residents of that area, and provide for public comments on the adequacy of the proposed service area on the basis of the standards set forth under this subsection.
The new language was considerably more direct than Section 202 of Title 47, focusing on the exclusion of areas from the Video Platform service area, and provides both for new rules to implement the section and a mechanism for public comment on the adequacy of service areas. The amendment will expand the debate about universal service and equity in a very concrete and important way. In his comments on the amendment, Richardson said that "one has to look no further than the problems incurred with building-out cable systems, especially in the inner cities, to realize that this amendment is crucial to bringing the information superhighway to all Americans, regardless of their ethnic or social-economic status."
The work in the redlining amendment involved a number of groups, which made different value added contributions. We didn't focus on the issue until CME and CFA proposed a study of the pending Video Dialtone applications. TAP conducted a preliminary analysis of a few cities, where we had good information about the neighborhoods. A number of Roundtable members looked at the proposed language on a very short time table, so that the amendment enjoyed a solid basis of support. The Media Access Project helped identify the key legal issues concerning the current state of the law, and Pharr's analysis of the Ameritech proposal provided strong empirical basis for a stronger FCC role in determining which communities will have access to the new services.
jamie love March 17, 1994
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