Crown Castle NG E. LLC v. Pa. Pub. Util. Comm'n
| Decision Date | 21 July 2020 |
| Docket Number | No. 2 MAP 2019,2 MAP 2019 |
| Citation | 234 A.3d 665 |
| Parties | CROWN CASTLE NG EAST LLC and Pennsylvania-cle LLC, Appellees v. PENNSYLVANIA PUBLIC UTILITY COMMISSION, Appellant |
| Court | Pennsylvania Supreme Court |
In this appeal by allowance, we consider the level of deference courts must afford an administrative agency's interpretation of its enabling statute. We conclude that an agency's interpretation of a clear and unambiguous statute is not entitled to deference. Additionally, we consider whether the Commonwealth Court erred in concluding that Distributed Antenna System (DAS) networks are public utilities under the Pennsylvania Public Utility Code (Code),1 thereby reversing the Pennsylvania Public Utility Commission's (PUC) interpretation of the definition of "public utility." For the following reasons, we affirm the judgment of the Commonwealth Court.
This case involves the status of DAS networks as public utilities in Pennsylvania. Appellees, Crown Castle NG East LLC (Crown Castle NG) and Pennsylvania-CLEC LLC (Pennsylvania-CLEC) (collectively Crown Castle), operate DAS networks. Crown Castle's DAS networks provide telecommunications transport services to Wireless Service Providers (WSP), such as AT&T Wireless, Verizon Wireless, T-Mobile, and others. The WSPs offer "commercial mobile radio service" (CMRS) to retail end-users.2 A DAS network transports the wireless traffic of its WSP customers, consisting of voice, data, and video traffic generated by a consumer's mobile device (smartphone), over terrestrial fiber optic lines between "nodes" and "hubs." The nodes are located on utility, streetlight, or traffic poles in public rights-of-way. They are comprised of small, low power antennae that receive radio frequency (RF) signals and additional equipment that converts the RF signals to optical signals. The optical signals are then transported over the DAS provider's fiber optic lines to a WSP's central hub, which is typically housed in a building on private property, where the signals are returned to the WSP customers. Crown Castle's DAS networks also transport signals for its WSP customers in the reverse direction, from a hub to a node.3
DAS networks increase the coverage area of their WSP customers’ networks. Due to the small size of the DAS node equipment, it can be installed on existing structures in areas that traditional cell towers cannot be located, such as densely populated urban areas or stadiums. This provides augmented network coverage to WSPs’ retail end-users with minimal visual or physical impact, unlike cell towers. A WSP provider may operate its own DAS networks that serve only its customers, or it may lease a DAS network from a neutral host, such as Crown Castle.
From 2005 to 2015, the PUC granted certificates of public convenience (CPC) to at least five neutral host DAS network operators, including Crown Castle NG and Pennsylvania-CLEC, to operate as Competitive Access Providers (CAP), concluding they were "public utilities" under Section 102 of the Code, which provides:
66 Pa.C.S. § 102 ; see also Crown Castle NG E. LLC v. Pa. Pub. Util. Comm'n , 188 A.3d 617, 620 (Pa. Cmwlth. 2018). Obtaining a CPC provides DAS networks with facilities siting benefits in that they gain access to public rights-of-way, are exempted from local zoning rules, and can exercise the power of eminent domain. PUC Order, Review of Issues Relating to Comm'n Certification of Distributed Antennae Sys. Providers in Pa. , M-2016-2517831, 3/17/17, at 23, 30 [hereinafter DAS Order]; see also 66 Pa.C.S. § 1104 ().
On November 19, 2015, the PUC granted a CPC to the neutral host DAS network operator SQF, LLC (SQF). However, two commissioners voted against issuing a CPC to SQF and filed statements explaining they concluded the PUC did not have jurisdiction to regulate or issue CPCs to DAS networks because they did not meet the Code's definition of public utilities. See 66 Pa.C.S. § 501 (). Thus, even though the PUC issued a CPC to SQF, it also directed the opening of formal proceedings to investigate the issue of the PUC's jurisdiction over DAS network operators.
On February 23, 2016, the PUC entered an order initiating a formal investigatory proceeding to determine whether it should continue to certify DAS networks as public utilities pursuant to Section 102(1)(vi) or whether DAS networks were "mobile domestic cellular radio telecommunications service[s]," which Section 102(2)(iv) excludes from the definition of public utility. Compare 66 Pa.C.S. § 102(1)(vi) with § 102(2)(iv). To guide its inquiry, the PUC issued 12 questions in an appendix to its investigation order and solicited comments and reply comments from interested parties. The PUC received comments from numerous stakeholders in three broad groups: Industry Stakeholders,4 Municipal Stakeholders,5 and the Office of Consumer Advocate.
Without holding a formal hearing, the PUC issued its March 17, 2017 DAS Order, which found that DAS networks were not entitled to certification as public utilities, but instead were excluded from the definition of public utilities under Section 102(2)(iv) because they "furnish[ed] mobile domestic cellular radio telecommunications service." See 66 Pa.C.S. § 102(2)(iv). The PUC began its analysis of Section 102 by stating that DAS network providers met the definition of public utility in Section 102(1)(vi) because they operate facilities that convey or transmit messages or communications. DAS Order at 14. However, the PUC then concluded that DAS networks were excluded from the definition of public utility by Section 102(2)(iv) because they "furnish mobile domestic cellular radio telecommunications service." Id. at 23 (quoting 66 Pa.C.S. § 102(2)(iv) ).
The PUC arrived at this conclusion by analyzing the technology DAS networks employ. The PUC explained that DAS networks provide personal wireless service by sending and receiving RF signals from the antenna at the node. Id. at 15-17 (). Because DAS networks’ antennae send and receive RF signals, the PUC rejected the DAS providers’ contention that they provide "backhaul service."6 Id. at 16-17. Similarly, the PUC dismissed the claim that the WSPs generate the RF signal, as the PUC found the DAS providers also wirelessly send and receive that RF signal. Id. at 17. Defining the term "furnish" in Section 102(2)(iv) as "to provide" or "to supply," the PUC concluded that DAS networks furnish, provide, and supply personal wireless services. Id. at 18, 18 n.46 ().
The PUC next found that DAS facilities are used to furnish "mobile" wireless services. Applying the Federal Communications Commission's rules and definitions, the PUC focused on whether the end-user's equipment is mobile or fixed. Id. at 21. The PUC found the wireless communication that DAS networks transmit is to mobile devices including smartphones and tablets. Id. at 22. The PUC rejected the DAS providers’ contention that their service is not mobile because they transport signals between fixed nodes and stationary hubs. Id. The PUC explained that the large dishes on macro towers are similarly stationary but are considered part of a mobile service. Accordingly, the PUC concluded "DAS facilities furnish mobile domestic cellular radio telecommunications service and, hence, cannot be certificated as public utilities under the Code." Id. at 23.
The PUC considered its decision's interaction with federal law. Id. The PUC dismissed concerns that decertification was a barrier to entry in violation of federal law. Id. Further, the PUC noted that federal law cannot compel it to certify a public utility based on potential siting complications arising from local ordinances. Id. at 23-24. The PUC conceded that federal law precludes the PUC from requiring DAS network operators to obtain a CPC. Id. at 24.
Next, the PUC addressed the implications of its decision to no longer certify DAS networks as public utilities related to facilities’ siting. Id. The PUC dismissed the DAS providers’ concern that they would have difficulties obtaining pole attachments without CPCs because the DAS Order recognized DAS operators provide telecommunications service, and the FCC granted pole attachment rights to all telecommunications providers. Id. at 25. Moreover, the PUC stated "it is illegal for any utility to require a CPC from this Commission as a requirement for allowing a telecommunication[s] service provider to exercise its pole occupancy rights." Id. at 27. Likewise, the PUC dismissed the DAS providers’ contention that its ruling would affect DAS providers’ ability to access...
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