City of Mason City v. City Center
| Decision Date | 10 October 2001 |
| Docket Number | No. 99-1004.,99-1004. |
| Citation | 634 N.W.2d 667 |
| Parties | CITY OF MASON CITY, Appellant, v. CITY CENTER OF MASON CITY, INC., Appellee. |
| Court | Iowa Supreme Court |
Herman P. Folkers of Folkers and Keen, Mason City, for appellant.
Charles H. Levad of the Levad Law Office, Mason City, for appellee.
Mark R. Schuling of Brick, Gentry, Bowers, Swartz, Stoltze, Schuling & Levis, P.C., Des Moines, for amicus curiae Iowa Cable & Telecommunications Association.
The appellant, City of Mason City, cited the appellee, City Center of Mason City, Inc. (City Center), for violation of a municipal ordinance prohibiting the operation of a cable communication system without a franchise. A judicial magistrate held that City Center had violated the city ordinance and ordered it to remove its cables from the public right-of-way. On appeal, the district court reversed and dismissed the citation against City Center, ruling that City Center did not operate a "cable system" as that activity is defined in the ordinance. Upon our review, we reverse and remand.
The facts of this case are essentially undisputed. City Center is an Iowa corporation that owns a building in downtown Mason City, Iowa that includes apartments. Because the franchised cable services provider in Mason City did not serve this building, City Center installed a satellite dish on the top of the building to provide cable television to building residents.
To help defray the cost of this system, City Center decided to use the satellite dish on its building to provide cable services, presumably for a fee, to residents of the Kirk Apartments located two blocks away. In order to get the signal to the Kirk Apartments, it was necessary for cable lines to cross three public streets. Prior to proceeding with installation of the lines, City Center negotiated easements with private building owners to attach the cable lines to their buildings. Thus, although the cable lines from the satellite dish to the Kirk Apartments crossed over city streets, the lines were not attached to city property and, in fact, did not touch any city property.
On October 27, 1997, the City cited City Center for operating a cable communication system without a franchise in violation of the Mason City Code of Ordinances section 3-17-4. The citation directed City Center to remove its cables from the public right-of-way.
City Center disputed the citation, and the matter was tried to a judicial magistrate on stipulated facts. The parties stipulated that under the city ordinance a "cable system" may only be operated pursuant to a city franchise. The term, "cable system," as defined in the ordinance, excluded any system "that serves only subscribers in one or more multiple unit dwellings ... no part of which system uses City right of way." The magistrate concluded that City Center did not fall within the exclusion because its cables crossed city streets, and, therefore, its system used city right-of-way. Accordingly, the magistrate held that City Center had violated the ordinance by operating a cable communication system without a franchise. A civil fine was imposed and City Center was ordered to remove its lines from city right-of-way.
On appeal to the district court, the district court concluded that City Center was not "using" the public right-of-way by merely passing cables over city streets, where "[t]he cable is attached solely to private property and does not rely on any public easements." The district court dismissed the citation.
The City sought and was granted discretionary review by this court. See Iowa Code § 631.16 (1997); Iowa Rs.App. P. 201, 203.
This case was brought before the court as a law action. Therefore, on discretionary review, the decision of the district court is reviewable for correction of errors at law. See Hunke v. Veach, 572 N.W.2d 548, 549 (Iowa 1997)
; City of Albia v. Stephens, 461 N.W.2d 326, 328 (Iowa 1990); Iowa R.App. P. 4.
Although this action is based on a municipal ordinance violation, federal law governs. Before we discuss the controlling statute—the Cable Communications Policy Act of 1984—and its preemptive authority, it is helpful to briefly review the concerns underlying the enactment of this law. See Cable Communications Policy Act of 1984, Pub.L. No. 98-549, 98 Stat. 2780 () (the Cable Act). Prior to the Cable Act, the Federal Communications Commission (FCC) pursued "open entry policies in the satellite field for the purpose of creating a more diverse and competitive telecommunications environment." In re Earth Satellite Communications, Inc., 95 F.C.C.2d 1223, 1231 (1983). As the FCC noted in its Earth Satellite opinion, "local prior approval requirements are inconsistent with national policies in these areas." Id. at 1232. In balancing the competing interests with respect to the communications industry, the FCC stated:
The ultimate dividing line, as we see it, rests on the distinction between reasonable regulations regarding use of the streets and rights-of-way and the regulation of the operational aspects of cable communications. The former is clearly within the jurisdiction of the states and their political subdivisions. The latter, to the degree exercised, is within the jurisdiction of this Commission.
The Cable Act reflects this dual regulatory framework by setting up "a comprehensive scheme for the regulation of cable services at the federal, state, and local levels." Channel One Sys., Inc. v. Conn. Dep't of Pub. Util. Control, 639 F.Supp. 188, 195 (D.Conn.1986). The Act "establish[es] a national framework for regulating cable television," while at the same time "provid[ing] for the franchising of cable systems by local governmental authorities." FCC v. Beach Communications, Inc., 508 U.S. 307, 309, 113 S.Ct. 2096, 2099, 124 L.Ed.2d 211, 219 (1993). The breadth of local authorities' power to franchise "cable systems" is controlled by the federal definition of "the operative term `cable system.'" Id. at 310, 113 S.Ct. at 2099, 124 L.Ed.2d at 219. That is because the franchise power of local government extends only to those entities meeting the federal definition of that term. See generally 47 U.S.C. §§ 541-547.
The Mason City ordinance at issue here acknowledges the dual framework envisioned by the Cable Act. Section 3-17-4 states:
All cable communication activity within the City shall be undertaken pursuant to a franchise granted by the City, and shall be in accordance with the provisions of this Chapter. A grantee shall at all times comply with the rules and regulations of the FCC as well as with all other applicable Federal and State statutes. FCC rules and regulations shall in all cases be controlling if any part of this Chapter or any cable television franchise is in conflict with any FCC rules and regulations.
Mason City Code of Ordinances § 3-17-4. The parties agree that the City cannot require a franchise if the service provided does not meet the federal definition of "cable system." See Guidry Cablevision/Simul Vision Cable Sys. v. City of Ballwin, 117 F.3d 383, 383 (8th Cir.1997)
(). That definition is as follows:
47 U.S.C. § 522(7) (emphasis added).1
It is undisputed that City Center provides a service that falls within the general definition of "cable system." The bone of contention is whether City Center's cable system "uses" public right-of-way within the meaning of the private cable exemption contained in § 522(7)(B).
Congress did not define the word "uses" or the phrase "uses any public right-of-way." City of Chicago v. FCC, 199 F.3d 424, 431 (7th Cir.2000); Guidry Cablevision, 117 F.3d at 385. Therefore, we initially must determine whether the agency charged with administration of the Cable Act—the FCC—has formulated an interpretation. See Chevron, U.S.A., Inc. v. Natural Res. Def. Council, Inc., 467 U.S. 837, 843, 104 S.Ct. 2778, 2782, 81 L.Ed.2d 694, 703 (1984)
. See generally United States v. Southwestern Cable Co., 392 U.S. 157, 178, 88 S.Ct. 1994, 2005, 20 L.Ed.2d 1001, 1016 (1968) ().
As the United States Supreme Court stated in Chevron, U.S.A., it has long been "recognized that considerable weight should be accorded to an executive department's construction of a statutory scheme it is entrusted to administer." 467 U.S. at 844, 104 S.Ct. at 2782, 81 L.Ed.2d at 704. If the construction adopted by the agency "`represents a reasonable accommodation of conflicting policies that were committed to the agency's care by statute, [the agency interpretation] should not [be] disturb[ed] ... unless it appears from the statute or its legislative history that the accommodation is not one that Congress would have sanctioned.'" Id. at 845, 104 S.Ct. at 2783, 81 L.Ed.2d at 704 (quoting United States v. Shimer, 367 U.S. 374, 383, 81 S.Ct. 1554, 1560, 6 L.Ed.2d 908, 915 (1961)).2
Upon our examination of relevant authorities, we find insight into the FCC's interpretation of the word "uses" in a report and order issued by the agency in 1990. See In re Definition of a Cable Television System, 5 F.C.C.R. 7638 (1990). The proceeding giving rise to this report was commenced "to clarify [the agency's] interpretation of the statutory term,...
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