Texas Telecom Law Sets Up Legal Showdown for Cities, State

Cities across Texas stand to lose millions of dollars due to a new law that slashes fees telecom providers pay to them. But before the savings go into effect in 2020, it’s likely cities will challenge the legislation in the courts. The bill would slash right-of-way fees telecom providers pay cities to supply cable and phone service. For years, companies paid cities two separate fees to run phone and cable TV lines in right-of-ways — even when delivered over the same line. The bill changes that practice and allows providers to only pay the higher of the two fees.

Supporters of the bill, like Walt Baum, the president of the Texas Cable Association, said it’s necessary to end an “outdated double tax” on companies. But Bennett Sandlin, executive director of the Texas Municipal League, said he thinks the legislation violates sections of the Texas Constitution. “The use of public land is a privilege, not a right,” Sandlin said. “They could certainly decide to run those wires through people’s backyards, but they would pay a lot more. They have to pay for that rental of public space.“