\[PUBLISH\]

IN THE UNITED STATES COURT OF APPEALS

FOR THE ELEVENTH CIRCUIT

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

No. 99-15160

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

FCC Docket No. 96-00098

SOUTHERN COMPANY,

Petitioner,

UNITED TELECOM COUNSEL,

EDISON ELECTRIC INSTITUTE, INC., and

BELL ATLANTIC,

Intervenors,

versus

FEDERAL COMMUNICATIONS COMMISSION

and UNITED STATES OF AMERICA,

Respondents,

MCI WORLDCOM, INC., AT&T, US WEST,

NATIONAL CABLE TELEVISION ASSOCIATION

and CALIFORNIA CABLE ASSOCIATION,

Intervenors.

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

No. 00-10257

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

FCC Docket No. 99-00266

FLORIDA POWER & LIGHT COMPANY,

Petitioner,

versus

FEDERAL COMMUNICATIONS COMMISSION,

UNITED STATES OF AMERICA,

Respondents,

MCI WORLDCOM, INC.,

Intervenor.

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

No. 00-11027

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

FCC Docket No. 96-00098

BALTIMORE GAS AND ELECTRIC COMPANY,

Petitioners,

versus

FEDERAL COMMUNICATIONS COMMISSION,

UNITED STATES OF AMERICA,

Respondents,

MCI WORLDCOM, INC.,

Intervenor.

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

No. 00-11071

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

FCC Docket No. 96-00098

COMMONWEALTH EDISON COMPANY,

Petitioner,

versus

FEDERAL COMMUNICATIONS COMMISSION,

UNITED STATES OF AMERICA,

Respondents,

MCI WORLDCOM, INC.,

Intervenor.

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

No. 00-11193

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

FCC Docket No. 96-00098

ATLANTIC CITY ELECTRIC COMPANY,

DELMARVA POWER AND LIGHT COMPANY,

DUQUENSE LIGHT COMPANY,

POTOMAC ELECTRIC POWER COMPANY,

PUBLIC SERVICE ELECTRIC AND GAS COMPANY,

RELIANT ENERGY HL&P,

TAMPA ELECTRIC COMPANY,

VIRGINIA ELECTRIC AND POWER COMPANY,

Petitioners,

versus

FEDERAL COMMUNICATIONS COMMISSION and

UNITED STATES OF AMERICA,

Respondents,

MCI WORLDCOM, INC.,

Intervenors.

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

No. 00-11300

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

FCC Docket No. 96-00098

AMERICAN ELECTRIC POWER SERVICE CORPORATION,

Petitioner,

BELL ATLANTIC,

Intervenor,

versus

FEDERAL COMMUNICATIONS COMMISSION,

UNITED STATES OF AMERICA,

Respondents,

MCI WORLDCOM, INC,

Intervenor.

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

No. 00-11452

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

FCC Docket No. 96-00098

DUKE ENERGY CORPORATION,

Petitioner,

BELL ATLANTIC,

Intervenor,

versus

FEDERAL COMMUNICATIONS COMMISSION and

UNITED STATES OF AMERICA,

Respondents,

MCI WORLDCOM, INC.,

Intervenor.

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

Petitions for Review of Orders of the

Federal Communications Commission

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

**(June 13, 2002)**

Before EDMONDSON, Chief Judge, BIRCH and WILSON, Circuit Judges.

WILSON, Circuit Judge:

Petitioners, a geographically diverse group of electric utility
companies, raise a series of challenges to several Federal
Communications Commission (FCC) guidelines implementing the 1996
Amendments to the Pole Attachments Act, 47 U.S.C. § 224. After carefully
reviewing petitioners' claims, and after the benefit of oral argument,
we hold that the FCC erred when it issued guidelines stating (1) that
the Pole Attachments Act's coverage extends to electric transmission
facilities; and (2) that utilities must expand the capacity of their
facilities to ensure that attaching entities have access to those
facilities. On each of petitioners' remaining challenges to the FCC
guidelines, we decline to disturb the FCC's determinations.

BACKGROUND

From the inception of the cable television industry, cable television
companies have attached their distribution cables to utility poles owned
and maintained by power and telephone companies. As a practical matter,
cable companies have had little choice but to do so. The start up costs
of constructing an entirely new set of poles and other distribution
facilities for cable television cables are prohibitive, and when coupled
with the difficulties of obtaining regulatory approval for a distinct
set of utility poles, the barriers to such construction are
insurmountable. Therefore, cable companies have long rented space from
utilities on their extant poles and conduits. Ownership of the only
facilities available gave the utilities a superior bargaining position
when renting space to cable providers, and the Pole Attachments Act
(passed in 1978) reflects Congress's decision to regulate this
relationship.

The Pole Attachments Act gave the FCC the authority to "regulate the
rates, terms, and conditions for pole attachments to provide that such
rates, terms, and conditions are just and reasonable" in any state that
does not already have such regulations in place. *Id.* § 224(b)(1). This
Act established a set of guidelines for the FCC to use in determining
whether the rates and terms of pole attachments were "just and
reasonable," and based upon these guidelines, the FCC promulgated a
series of rules regulating the practice.

Importantly, the FCC's regulatory authority pursuant to the Pole
Attachments Act was limited; it could not mandate that utilities make
their poles available to cable providers, but rather could merely
regulate the rates charged those cable providers that were voluntarily
given access to poles. Voluntary access was hardly an issue at the time.
Indeed, utilities were anxious to lease surplus portions of their poles
to cable providers, and thus get some return on what would otherwise be
surplus plant. The problem that the Pole Attachments Act sought to
address was the potentially unfair prices utilities could extract from
cable companies for leasing space, not any problems associated with the
denial of access to the cable companies.

By 1996, the economic landscape surrounding pole attachments had
undergone a fundamental change. Electric utilities saw the
telecommunications arena as a logical and potentially lucrative choice
for the diversification of their businesses. Cable companies were
fearful that the utilities' prospective entry into the
telecommunications market would endanger their pole attachments, as
utilities would be unwilling to rent space on their poles to competing
entities. Congress elected to address both of these matters in the 1996
Telecommunications Act.

The 1996 Telecommunications Act authorized expanded competition in
telecommunications markets, permitting utilities to enter that rapidly
expanding field. Congress recognized, however, that utilities would lose
the incentive to voluntarily enter into pole attachment agreements with
telecommunications and cable television companies that were now their
competitors.[^1] Congress thus added a "nondiscriminatory access"
provision to the Pole Attachments Act, requiring any utility that uses
its poles, ducts, conduits, or rights-of-way for wire communications to
provide cable television or telecommunications companies with access to
that space on a nondiscriminatory basis. *Id*. § 224(f)(1). A utility
may only deny such entities access "on a non-discriminatory basis where
there is insufficient capacity and for reasons of safety, reliability
and generally applicable engineering purposes." *Id.* § 224(f)(2).

Shortly after the passage of the 1996 Telecommunications Act, the FCC
issued a series of regulations designed to implement the legislation.
The bulk of the regulations, contained in the FCC's *First Report and
Order*, addressed issues relating to the deregulation of local telephone
exchanges. However, the *First Report and Order* also promulgated
guidelines seeking to implement the 1996 Telecommunications Act's
provisions modifying the Pole Attachments Act.[^2] Petitioners filed
petitions seeking reconsideration of some of the FCC's findings in the
*Order*. After considering these requests for changes in the *First
Report and Order*, the FCC issued its *Order on Reconsideration* in
1999. Petitioners brought the instant action objecting to the following
determinations initially made in the *First Report and Order* and
affirmed upon reconsideration:

\(1\) that the Act covers electric transmission facilities, as opposed
to merely "any pole, duct, conduit, or right-of-way owned or controlled
by \[utilities\]";

\(2\) that utilities must expand pole capacity to accommodate requests
for attachment in situations where it is agreed that there is
insufficient capacity on a given pole to permit third-party pole
attachments;

\(3\) that utilities may not reserve available capacity on their
facilities for future utility-related use unless the reservation is made
pursuant to a bona fide development plan, and that utilities must permit
use of such reserved space by third-party attachers until the utility
has an "actual need" for the space;

\(4\) that if the utilities use some of their poles, ducts conduits, and
rights-of-way for wire communications services, the Act grants
third-party attachers access to all of the utilities' poles, ducts,
conduits, or rights-of-way;

\(5\) that the utilities may not limit those who place and maintain
attachments on their poles to their own specially trained employees or
contractors; and

\(6\) that the utilities must comply with a series of guidelines
regarding notification to third-party attachers in the event a pole
needs to be modified, and must bear certain costs associated with pole
modifications.

We will discuss each of these objections in turn.

DISCUSSION

The FCC is charged with administering the Act, and the guidelines under
review were promulgated pursuant to its interpretation of the Act. We
therefore will review the FCC's interpretation of the statute using the
two-step process first articulated in *Chevron U.S.A., Inc. v. NRDC,
Inc.*, 467 U.S. 837, 842--45 (1984). *Chevron's* first step requires us
to ascertain whether Congress has spoken unambiguously "to the precise
question at issue." *Id.* at 842. If the language of the statute is
unambiguous, we go no further, for we must give effect to clear
congressional intent. *Id.* at 842--43. If, however, we determine that
Congress's intent is ambiguous as to the question at issue, we must move
on to the second step of the *Chevron* test and ask whether the agency's
interpretation of congressional intent is reasonable. *Id*. at 844. We
must defer to an agency's reasonable interpretation of congressional
intent. *Id*. at 844--45.

I.

[Electric Transmission Facilities]{.underline}

We first consider whether the FCC exceeded its authority by asserting
that the Act applies not just to the "poles, ducts, conduits, and
rights-of-way owned or controlled by \[utilities\]," 47 U.S.C. §
224(f)(1), but to electric transmission facilities as well. Petitioners
contend that the plain language of the Act limits its coverage to
electric distribution facilities, and that the FCC acted ultra vires
when it construed the Act as applying to electric transmission plant as
well.[^3] The FCC claims that the distinction between electric
transmission facilities and electric distribution facilities is not as
clear as petitioners suggest, and that petitioners' construction of the
Act would thwart congressional intent by carving out an artificial
exemption from the Act's coverage for any facility designated as
containing "transmission" plant.

To ascertain whether the FCC's guideline is an acceptable construction
of congressional intent, we will first need to assess the differences
between a utility's transmission facilities and its distribution
facilities. We then must consider the statutory language, and see
whether the statute's text limits the application of the Act to a
utility's distribution plant. We can then apply the *Chevron* test to
the FCC guideline.

Petitioners argue that electric transmission facilities are entirely
distinct from local distribution facilities and are outside of the
purview of the FCC's regulatory authority. The distinction between the
two types of facilities has been described by one state public service
commission as follows:

> The operations of an electric utility can be separated into three
> major systems: production, transmission, and distribution.
> Transmission systems, which comprise the second major component of an
> electric utility, transmit large quantities of electrical energy over
> relatively long distances from generating stations to major load
> centers. Transmission systems consist of switching stations,
> substations, towers, conductors (wires), and rights-of-way.
>
> The third major component of an electric utility is the distribution
> system and is comprised of substations, underground cables, poles,
> overhead conductors, transformers, service drops, and meters that
> supply power to the customers.

*Re Conn. Light & Power Co.*, 92 P.U.R.4th 50, 58--61 (Conn. Dep't of
Pub. Util.

Control Mar. 23, 1988).

The important differences between electric transmission facilities and
electric distribution facilities are reflected in the present regulatory
scheme for electric utilities. Transmission systems generally transport
energy in bulk across state lines, and the operation of these systems is
subject to regulation by the Federal Energy Regulatory Commission (FERC)
pursuant to the Federal Power Act. 16 U.S.C. § 824(b)(1). However, the
Federal Power Act explicitly divests the FERC of regulatory jurisdiction
"over facilities used for the generation of electric energy or over
facilities used in local distribution." *Id*. This provision recognizes
the essentially local character of distribution facilities and systems,
as opposed to the primarily interstate character of electric
transmission facilities. Regulation of the latter was to be implemented
by the FERC, while regulation of the former was to be left primarily in
the hands of state and local authorities. This bifurcated regulatory
structure is indicative of the accepted and fundamental distinction
between a utility's transmission plant and its distribution plant.

The FCC argues, however, that this distinction is not as clear as
petitioners claim. Not all transmission facilities necessarily entail
interstate transmission of energy. Section 824(b)(1) recognizes this
fact, and divests the FERC of regulatory authority over facilities used
"only for the transmission of electric energy in intrastate commerce, or
over facilities for the transmission of electric energy consumed wholly
by the transmitter." *Id.* While "transmission" of electricity may
generally be an interstate matter, there are clearly situations in which
transmission takes place entirely within a state, outside of the
jurisdiction of federal regulatory bodies.

Another reason that the distinction between distribution and
transmission facilities is difficult to draw is that many poles have a
shared purpose. The FCC found, and petitioners do not dispute, that a
number of distribution poles are affixed with transmission conductors
and other transmission plant. *See Br. of Pet'r Fla. Power & Light Co.*
at 27. There are plainly instances where elements of the two segments of
the electric industry are combined on one entity, such as a distribution
pole.

Thus, the FCC argues that it is arbitrary and contrary to the statute to
attempt to draw a hard distinction between "distribution" and
"transmission" facilities. They found that the Act applies to any
facility that can be used for wire attachments. *See Br. of Resp'ts* at
31. Our task is to assess whether this finding can be reconciled with
the intent of the Act.

We begin our analysis with the text of the statute. The relevant
language concerning the scope of the Act's coverage provides that
"\[t\]he term pole attachment means any attachment by a cable television
system or provider of telecommunications service to a pole, duct,
conduit, or right-of-way owned or controlled by a utility." 47 U.S.C. §
224(a)(4). "Poles, ducts, and conduits" are regular components of local
distribution systems and not interstate transmission systems. Indeed,
the primary physical unit responsible for carrying transmission wire --
towers -- are notably absent from the definition of "pole attachment."
This indicates to us that Congress intended the Act as a mechanism for
regulating attachments on the utilities' distribution facilities, not
their transmission facilities and systems.

This reading of the Act is strengthened by the presence of a
reverse-preemption provision, codified at 47 U.S.C. § 224(c)(1), which
removes the FCC's authority to regulate pole attachments in any place
where a state has elected to do so. As states lack general regulatory
authority over interstate transmission facilities, this language
strongly suggests that the Act's coverage does not extend beyond local
distribution facilities. The Senate Committee notes accompanying the Act
lend credence to this interpretation of the Act's coverage:

> The committee considers the matter of CATV pole attachments to be
> essentially local in nature, and that the various state and local
> regulatory bodies which regulate other practices of telephone and
> electric utilities are better equipped to regulate CATV pole
> attachments. . . . It is only because such state or local regulation
> currently does not widely exist that federal supplemental regulation
> is justified.

S. Rep. No. 95-580, at 16-17 (1977), *reprinted in* 1978 U.S.C.C.A.N.
109, 124--25 (caps omitted).

The text of the statute, coupled with the presence of this
reverse-preemption clause, make it plain that the Act's coverage was
intended to be limited to the utilities' local distribution facilities,
and was not to extend to the general regulation of interstate
transmission towers and plant.

However, this does not mean that the FCC lacks the authority to regulate
a pole that happens to contain transmission wire. The Act grants the FCC
the power to regulate "poles, ducts, conduits, or rights-of-way," and
does not limit the FCC's authority to those "poles, ducts, conduits, or
rights-of-way" not used for the purposes of transmission.

Applying the *Chevron* test to the relevant FCC guideline, we find that
the Act, when considered as whole, speaks precisely to the question at
issue. Our inquiry is therefore complete after the first step of the
*Chevron* test. The reverse-preemption clause, coupled with the absence
of any textual reference to "towers" or other forms of transmission
plant, indicates that Congress intended to limit the Act's application
to local distribution facilities. Therefore, petitioners are correct
that the scope of the Act, and of the FCC's regulatory power, does not
extend to a utility's interstate electric transmission towers and
facilities, which are regulated by the FERC and are outside of the
purview of the FCC's authority. To the extent that the FCC guideline
suggests that the Act covers interstate transmission towers and
facilities, it must be struck down, as it fails to effect the
unambiguous intent of Congress.

However, the FCC is correct that the text of the Act clearly indicates
that its coverage extends to any of a utility's "poles, ducts, conduits,
or rights-of-way," so long as the utility (1) uses any of its "poles,
ducts, conduits, or rights-of-way" for wire communications; and (2) the
facility does not fall within one of the exceptions indicated in §
224(f)(2). The fact that a given "pole, duct, conduit, or
right\[\]-of-way" may have some transmission plant attached to it does
not exclude it from the coverage of the Act. These local distribution
facilities, festooned as they may be with transmission wires, are
plainly within the FCC's jurisdiction under the terms of the Act.

In sum, the plain language of the Act mandates the following:
transmission towers and other interstate transmission facilities are not
subject to the Act's provisions, and the FCC lacks the authority to
regulate these facilities. However, the Act generally covers all "poles,
ducts, conduits and rights-of-way," and these local distribution
facilities are covered by the Act, regardless of whether they are used
in part for transmission wires or other transmission facilities.

II\.

[Expansion of Capacity]{.underline}

In situations where it is agreed that capacity on a given pole or other
facility is insufficient to accommodate a proposed attachment, the FCC
orders require utilities to expand the capacity of their existing
infrastructure at the request of attaching entities. Petitioners
challenge this requirement as contrary to the express language of the
Act. The challenged portion of the *Order on Reconsideration* reads as
follows: "\[T\]he principle of nondiscrimination established by section
224 (f) (1) requires a utility to take all reasonable steps to expand
capacity to accommodate requests for attachment just as it would expand
capacity to meet its own needs." *Order on Reconsideration*, 14 FCC Rcd.
18049, para. 51 (Oct. 20, 1999).

Petitioners' challenge to this guideline is rooted in the text of §
224(f)(2). This clause provides that "a utility providing electric
service may deny a cable television system or any telecommunications
carrier access to its poles, ducts, conduits, or rights-of-way on a
non-discriminatory basis where there is insufficient capacity and for
reasons of safety, reliability and generally applicable engineering
purposes." 47 U.S.C. § 224(f)(2). Petitioners argue that this language
speaks precisely to the question of whether utilities must expand the
capacity of their plant to provide access for potential attachers, and
answers that question in the negative. The entire purpose of this
section is to specify the exceptions to the general rule mandating that
utilities provide cable and telecommunications companies
nondiscriminatory access to their facilities; one of those exceptions is
implicated when the facility contains "insufficient capacity." If
utilities are required to expand the capacity of their plant at the
request of a third party, "it is hard to see how you can give section
224 (f) (2) any meaning at all . . . ." *Order on Reconsideration*, 14
FCC Rcd. at 18099 (Powell, Comm'r, concurring in part and dissenting in
part).

The FCC counters this argument by noting that many utilities now use
their poles to support thriving telecommunications businesses of their
own (ten of the thirteen petitioners own or have financial involvement
in telecommunications businesses), and suggests that the
nondiscrimination principle that motivated the 1996 Telecommunications
Act mandates that the FCC prohibit a utility from "favor\[ing\] itself
over other parties with respect to the provision of telecommunications
or video programming services." *First Report and Order*, 11 FCC Rcd.
15499, para. 1157 (Aug. 1, 1996). The rule on expansion of capacity,
according to the FCC, is simply one manner in which the FCC implements
Congress's intent to prevent utilities from exploiting their monopoly
ownership of the necessary infrastructure to deny competitors access to
their markets. The FCC merely mandates that utilities make room for
third parties in the same manner in which they would if they needed
additional space for their telecommunications operations.

The FCC's position is contrary to the plain language of § 224(f)(2).
While the FCC is correct that the principle of nondiscrimination is the
primary purpose of the 1996 Telecommunications Act, we must construe
statutes in such a way to "give effect, if possible, to every clause and
word of a statute." *Williams v. Taylor*, 529 U.S. 362, 404 (2000)
(internal quotation marks omitted). Section 224(f)(2) carves out a plain
exception to the general rule that a utility must make its plant
available to third-party attachers. When it is agreed that capacity is
insufficient, there is no obligation to provide third parties with
access to that particular "pole, duct, conduit, or right-of-way." 47
U.S.C. § 224(f)(2). As Commissioner Michael Powell noted, it is hard to
see how this provision could have any independent meaning if utilities
were required to expand capacity at the request of third parties. The
entire purpose of the section is to specify the conditions under which
the general rules mandating access for third parties do not apply. By
attempting to extend those generally applicable rules into an area where
the statutory text clearly directs that they not apply, the FCC is
subverting the plain meaning of the Act.

Therefore, our inquiry on this issue need not extend beyond the first
step of the *Chevron* test. The FCC's attempt to mandate capacity
expansion is outside of the purview of its authority under the plain
language of the statute.

III\.

[Reserved Space]{.underline}

Petitioners object to the FCC's orders specifying the disposition of
"reserved space" on a given pole or other utility-owned facility. The
FCC acknowledges that utilities enjoy the right to reserve space on
their facilities for their future use, in order to ensure the integrity
and reliability of their core utility service. However, the FCC
guidelines require that utilities seeking to reserve space on their
facilities take two distinct steps to which they object. First,
utilities may not reserve space for future use unless they do so
pursuant to a "bona fide development plan that reasonably and
specifically projects a need for that space in the provision of its core
utility service." *First Report and Order*, 11 FCC Rcd. at para. 1169.
Second, utilities must permit third parties to use reserved space until
such time as the utility demonstrates an actual need for the reserved
space. Petitioners claim that these requirements are contrary to the
language and intent of the Act and, alternatively, are arbitrary and
capricious exercises of the FCC's discretionary authority.

Petitioners once again rely upon the text of § 224(f)(2) to support
their contention that the FCC's rule is contrary to statute. They argue
that the language permitting utilities to deny access on the basis of
"insufficient capacity" specifically entrusts the utilities with the
power to determine when capacity is insufficient, and the FCC's rules
limiting the utilities' ability to reserve capacity on their facilities
removes this power from the utilities and places it in the FCC's hands.
Utilities regularly reserve space on poles to ensure the reliability and
safety of electric service, as well as for legitimate engineering
purposes. Petitioners argue that requiring the utilities to justify
their decision to reserve capacity for these purposes to the FCC gives
the FCC a power completely outside of the realm of its expertise, and is
contrary to the language and intent of the Act.

Petitioners further claim that the rule mandating that reserved space be
offered to third parties until such time as it is actually needed by a
utility is both contrary to § 224(f)(2) and blatantly unreasonable. Once
again, petitioners argue that the plain language of § 224(f)(2) is
contradicted when utilities are forced to provide space, even
temporarily, for third-party attachers when the utilities have already
determined (through the reservation of space) that capacity is
insufficient. Also, as a practical matter, it will be extremely
difficult to evict third parties using reserved space at the time a
utility develops an actual need for the space. This would risk
disrupting existing cable television or telecommunications service and
would be unlikely to receive FCC approval. Thus, petitioners claim that
the FCC's rule foists an unworkable system onto the utilities with
respect to their rights to reserve space on their facilities.

The FCC argues that its rules on reserved space are simply a mechanism
for ensuring that the nondiscrimination principle is fully implemented.
Its rules are a method of ensuring that the utilities do not reserve
excessive space indefinitely in an effort to keep potential competitors
from using their facilities. The FCC claims that the "bona fide
development plan" rule is a reasoned mechanism to guarantee that
utilities do not reserve space without legitimate purposes in mind. The
"actual need" regulation is another reasonable manner of ensuring that
utilities do not reserve space for extensive periods in an effort to
deny attachers (and prospective competitors) the benefit of their
infrastructure. The FCC asserts that both of these rules are simply ways
of making sure that utilities that claim that "insufficient capacity"
exists on their poles due to reserved space actually do lack the
capacity on their poles based upon legitimate future needs, and are not
simply attempting to reserve excessive space in order to thwart the
interests of their competitors.

Applying the *Chevron* test to the FCC's guidelines, we find that the
Act does not speak precisely to the question at issue; namely, how the
term "insufficient capacity" is to be defined. Nothing in the language
of the statute specifies the conditions under which capacity should be
deemed insufficient. Petitioners' construction of the Act, which claims
that the utilities enjoy the unfettered discretion to determine when
capacity is insufficient, is not supported by the Act's text. The
language of § 224(f)(2) does not speak in such absolute terms; there are
no suggestions, here or elsewhere in the Act, that utilities enjoy the
right to reserve as much space as they wish for as long as they deem
necessary, and on that basis, to deny cable companies attachments based
upon a lack of capacity. In fact, the statute is silent on the scope and
parameters of the term "insufficient capacity," and on the relationship
between that term and the utilities' ability to reserve available space
for future needs.

The absence of statutory language outlining this relationship is a gap
in the statutory scheme. "From that gap springs executive discretion."
*Gonzalez v. Reno*, 212 F.3d 1338, 1348 (11th Cir.), *cert. denied*, 530
U.S. 1270 (2000). *Chevron* mandates that we defer to a reasonable
agency effort to fill the gaps in a given statutory scheme. 467 U.S. at
843--44. Therefore, we turn to step two of the *Chevron* test, which
requires us to assess whether the FCC guidelines on reserved space are
reasonable.

The FCC guideline requiring a "bona fide development plan" as a
prerequisite to a utility's reservation of space for its future needs is
a reasonable exercise of agency discretion. The FCC recognized that
utilities enjoy the power to reserve space on their facilities for
future utility-related needs. However, the FCC must have some way of
assessing whether these needs are bona fide; otherwise, a utility could
arbitrarily reserve space on a pole, claiming it necessary on the basis
of unsupportable "future needs," and proceed to deny attachers space on
the basis of "insufficient capacity." This is clearly not what Congress
intended when it passed the Act; such a construction would undermine the
plain intent of the nondiscrimination provisions found in § 224(f)(1).
The FCC thus requires utilities to justify their need for any space they
seek to reserve (and thus deny potential attachers) by demonstrating a
bona fide future need for that space. This appears an eminently
reasonable mechanism to ensure that when utilities reserve space on a
pole and deny attachers access on the basis of insufficient capacity,
capacity is actually insufficient. If in individual cases, the FCC
unreasonably rejects a utility's legitimate reservation of space, the
utilities are entitled to seek judicial review of that order.

The second FCC guideline under attack -- allowing third parties to use
reserved space until the utility demonstrates actual need -- is another
reasonable effort to fill a gap in the statute. Reserved space on a
given facility is not unusable in the short term. The FCC construed the
term "insufficient capacity" to mean the actual absence of usable
physical space on a pole. Reserved capacity is, temporarily at least, of
use to attaching entities. All parties will presumably be aware of the
temporary nature of this available space, and attachers will have to be
prepared for potential disruptions that may occur when the utility
demonstrates an actual need for the space. There is nothing unreasonable
or arbitrary about this construction of the ambiguous term "insufficient
capacity." Hence, it is entitled to deference under the terms of
*Chevron*.

In conclusion, the FCC guidelines with respect to reserved space are
reasonable constructions of an ambiguous statutory term. We therefore
must accord those guidelines due deference.

IV\.

[Scope of Third-Party Access]{.underline}

Petitioners claim that the FCC exceeded its statutory authority when it
found that the Act triggered access for third parties to all of a
utility's "poles, ducts, conduits, and rights-of-way," regardless of
whether those facilities are presently being used for wire
communications. The challenged language in the *First Report and Order*
reads: "We see no statutory basis . . . for the argument made by some
utilities that they should be permitted to devote a portion of their
poles, ducts, conduits, and rights-of-way to wire communications without
subjecting all such property to the access obligations of section 224
(f) (1)." *First Report and Order*, 11 FCC Rcd. at para. 1173.

The crux of petitioners' claim is their construction of the text of §
224(a)(1), which defines a "utility" as "any person . . . who owns or
controls poles, ducts, conduits, or rights-of-way used, in whole or in
part, for any wire communications." 47 U.S.C. § 224(a)(1). The utilities
argue that this language demonstrates congressional intent to limit the
Act's coverage to facilities already being used for wire communications.

Petitioners' argument is weak. The plain meaning of § 224(a)(1) is that
a utility (for the purposes of the statute) is any entity that controls
"poles, ducts, conduits, or rights-of-way" and uses some of those
facilities for wire communications. The language does not limit the
definition of a "utility" to an entity that uses [all]{.underline} of
its facilities for the purpose of wire communications; the lack of such
limiting language leads to the natural inference that a utility is an
entity that owns or controls [some]{.underline} facilities used for that
purpose.

Furthermore, the plain language of another part of the Act effectively
forecloses petitioners' argument. Section 224(f)(1) provides that "\[a\]
utility shall provide a cable television system or any
telecommunications carrier with nondiscriminatory access to any pole,
duct, conduit, or right-of-way owned or controlled by it." *Id*. §
224(f)(1). This language plainly mandates that utilities make all of
their "poles, ducts, conduits, or rights-of-way" available to
third-party attachers (unless one of the exceptions listed in §
224(f)(2) applies), regardless of whether the facility is presently
being used for telecommunications purposes. We have noted that "the
adjective 'any' is not ambiguous; it has a well established meaning."
*Lyes v. City of Riviera Beach*, 166 F.3d 1332, 1337 (11th Cir. 1999)
(en banc) (internal quotation marks omitted). "Read naturally, the word
'any' has an expansive meaning . . . . \[When\] Congress \[does\] not
add any language limiting the breadth of that word, . . . 'any' means
'all.'" *Merritt v. Dillard Paper Co.*, 120 F.3d 1181, 1186 (11th Cir.
1997) (citation omitted) (internal quotation marks omitted). In this
context, the lack of a limitation upon the adjective 'any' means that §
224(f)(1) expands the Act's coverage to all "poles, ducts, conduits, or
rights-of-way owned or controlled by a utility."

Thus, we need not look beyond *Chevron*'s first prong on this issue.
Congress has unambiguously stated that the Act's coverage extends to all
"poles, ducts, conduits, or rights-of-way owned or controlled by a
utility." The FCC orders under challenge give this plain language
effect, and therefore we cannot disturb the orders.

V.

[Third-Party Workers]{.underline}

Petitioners argue that after an attaching entity is granted access to
the utility's facilities, the utility should be able to limit those that
perform attachment installation and maintenance to its own specially
trained employees or designated independent contractors. Petitioners
challenge the FCC guideline stating the following: "\[A\] utility may
require that individuals who will work . . . in the proximity of
electric lines . . . have the same qualifications, in terms of training,
as the utility's own workers, but the party seeking access will be able
to use any individual workers who meet these criteria." *Order on
Reconsideration*, 14 FCC Rcd. at para. 86.

Petitioners argue that the rule goes beyond the statutory authority the
FCC enjoys to regulate the "rates, terms, and conditions" of pole
attachments. 47 U.S.C. § 224(b)(1). They argue that the statute does not
give the FCC the authority to regulate the utility's employment
practices, an area already regulated by other federal and state
agencies. This position is shared by FCC Commissioner Harold W.
Furchtgott-Roth, who stated in his dissent, "Put directly, I see nothing
in section 224 that gives this Commission authority to regulate the
labor and employment practices of electric utilities. This is simply not
a case of statutory ambiguity." *Order on Reconsideration*, 14 FCC Rcd.
at 18097 (Furchtgott-Roth, Comm'r, concurring in part and dissenting in
part).

Alternatively, petitioners contend that the rule is unreasonable. In
order to work safely on electric facilities, personnel require a unique
understanding of the dangers associated with performing construction,
maintenance, or repair work in proximity to electric wires. Personnel
having such skills are in short supply. According to petitioners,
outside workers, regardless of their paper qualifications, likely will
not be as capable as those that work day in and day out on these
facilities for the utilities. In the case of utility employees, the
utility is able to supervise the work, make competency determinations,
and discipline employees when necessary. This is not the case with
employees of third-party attachers. Petitioners claim that the ultimate
result of the rule is unduly onerous to utilities, which must endure the
dangers associated with less capable people working on their lines.
Therefore, petitioners aver that the guideline must be struck down as
capricious.

Applying the *Chevron* test to this guideline, we find that the statute
does not speak unambiguously to the question at issue. There is no
mention of the qualifications of workers anywhere in the Act's text.
However, the Act gives the FCC the power to regulate the "rates, terms
and conditions" of pole attachments; the FCC argues that its regulations
governing the qualifications of workers falls within the parameters of
its authority to regulate the "conditions" of pole attachments. Absent
some clear indication on the face of a statute that an agency lacks the
authority to regulate a particular subject matter, "agencies have
authority to fill gaps where the statutes are silent." *Nat'l Cable &
Telecomms. Ass'n v. Gulf Power Co.*, \_\_ U.S. \_\_, 122 S. Ct. 782, 789
(2002). The Act does not specify what sorts of concerns constitute the
"conditions" of a pole attachment, and there is no statutory language
suggesting that regulation of the physical process of attaching wires
(by workers) is outside of the scope of the "conditions" of a pole
attachment. Hence, we have a gap in the statutory scheme -- the
"conditions" of a pole attachment must be given some content. The gap in
the statute means that Congress has not spoken unambiguously to the
precise question at issue, and *Chevron* mandates that we must defer to
a reasonable agency attempt to give effect to ambiguous congressional
intent.

Looking at this second step of the *Chevron* analysis, we find the FCC's
rule within the scope of its discretion. Once an attaching entity is
granted access to a utility's facilities, the attacher must install its
equipment on the utility's facilities and perform maintenance on that
equipment from time to time, and the FCC recognizes that forcing
third-party attachers to use the utility's workers to construct and
maintain the attachments would impede the attachers' access to the poles
and lead to disputes over compensation, quality of work, and the like.
The FCC's rule mandates that third-party workers have access to the
poles in order to prevent these potential disputes, but permits
utilities to set standards for those workers to ensure that they have
the necessary qualifications. This guideline is a reasonable effort to
regulate one of the fundamental "conditions" of a pole attachment --
namely, the process by which an attachment is made and maintained. The
guideline represents an attempt to balance the interests involved in a
measured and reasonable way, and *Chevron* dictates that we accord it
appropriate deference. We therefore decline to overturn the FCC's
findings regarding the regulation of third-party workers.

VI\.

[Pole Modification]{.underline}

Petitioners dispute two additional sets of guidelines the FCC developed
in interpreting § 224(h) of the Act, which provides,

> Whenever the owner of a pole, duct, conduit, or right-of-way intends
> to modify or alter such pole, duct, conduit, or right-of-way, the
> owner shall provide written notification of such action to any entity
> that has obtained an attachment to such conduit or right-of-way so
> that such entity may have a reasonable opportunity to add to or modify
> its existing attachment. Any entity that adds to or modifies its
> existing attachment after receiving such notification shall bear a
> proportionate share of the costs incurred by the owner in making such
> pole, duct, conduit, or right-of-way accessible.

47 U.S.C. § 224(h).

Petitioners challenge the following three guidelines implementing this
statutory provision:

\(1\) that absent a private agreement, utilities seeking to modify their
poles or facilities must give the companies with attachments on that
facility sixty days notice of the proposed modification;[^4]

\(2\) that a utility that uses a request for modification from an
attaching entity to bring its facilities into compliance with applicable
safety or other regulatory guidelines will be responsible for its share
of the modification costs; and

\(3\) that a utility will bear all of the costs of any
government-mandated modification of a facility (such as road widening,
etc.), as the utility would bear those costs even in the absence of any
attachment to the facility.

Applying the *Chevron* test to each of these guidelines, we find that
Congress has not spoken precisely to any of these questions. The Act
mandates that attaching entities be given notice when a modification is
to take place; the language does not specify the time frame for that
notice. The Act requires that each attaching entity pay a
"proportionate" share of the costs an owner incurs in making its
facilities available to them; the term "proportionate" is not defined in
the text of the statute. Therefore, we have gaps in the statute with
respect to the specifics of these issues, and we must defer to any
reasonable agency efforts to fill these gaps. *Chevron*, 467 U.S. at
843--44.

We find nothing capricious in the FCC's construction of § 224(h). The
sixty-day rule is a common-sense, flexible effort to implement the
statute's notice requirement. The second guideline, requiring that
utilities bear a proportionate share of the costs associated with
modernizing their plants pursuant to an attacher's request for a
modification, is also reasonable. As the utilities will be the primary
beneficiaries of efforts to modernize their facilities, it is logical
for the FCC to mandate that they bear some share of the costs of the
transition. Finally, it is reasonable to mandate that utilities bear the
costs of modifying their facilities in response to local government
mandates, given that they would bear these costs in any event. Attaching
entities are not given a free ride, as incremental costs associated with
moving the attachment can be factored into the standard rent utilities
charge to attachers. *Order on Reconsideration*, 14 FCC Rcd. at para.
105.

In sum, the FCC's guidelines implementing § 224(h) are neither contrary
to the statute nor unreasonable, and we therefore decline to disturb
them.

CONCLUSION

In conclusion, we find that two of the FCC's guidelines implementing the
1996 amendments to the Act are contrary to the statutory language and
must be overturned. First, the FCC exceeded its authority under the Act
when it determined that interstate transmission towers and plant were
subject to its regulatory authority. The Act's language and structure
limit its coverage to "poles, ducts, conduits, and rights-of-way," which
do not generally comprise part of a utility's transmission system. While
the presence of transmission wires or other transmission facilities on
"poles, ducts, conduits, or rights-of-way" does not divest the FCC of
jurisdiction over those facilities, the FCC plainly has no jurisdiction
over transmission towers or other transmission plant. Second, the FCC
lacks the authority to order utilities to expand the capacity of their
infrastructure to accommodate third-party attachers in situations where
it is agreed that existing capacity is insufficient. With respect to all
of the other guidelines under challenge, we decline to overturn the
FCC's determinations.

SO ORDERED.

[^1]: A number of new telecommunications entities had been seeking to
    attach their wires to utility poles for some time, but were not
    covered by the Pole Attachments Act. The 1996 Telecommunications Act
    added telecommunications carriers to the class of entities entitled
    to regulated rates for pole attachments, and granted them the same
    access rights given cable companies.

[^2]: The Pole Attachments Act, as modified by the 1996
    Telecommunications Act, will hereinafter be referred to as the
    "Act."

[^3]: The specific language of the FCC guideline to which petitioners
    object is the following: "electric transmission facilities are not
    exempted from the pole attachment provisions of section 224." *Order
    on Reconsideration*, 14 FCC Rcd. 18049, para. 27 (Oct. 20, 1999).

[^4]: The guideline contains an exception for situations where sixty
    days notice would be impractical, and in such cases, simply requires
    the utilities inform attaching entities of proposed modifications
    "as soon as reasonably practicable." *Order on Reconsideration*, 14
    FCC Rcd. at para. 89.