*Pages 1--28 from  Microsoft Word - 16895*
 Federal  Communications  Commission  FCC  99-  402 
 Before  the  FEDERAL  COMMUNICATIONS  COMMISSION 
 Washington,  D.  C.  20554 
 In  the  Matter  of  )  ) 
 )  The  Petition  of  the  State  of  Minnesota  ) 
 for  a  Declaratory  Ruling  Regarding  the  )  Effect  of  Section  253  on  an  Agreement  )  CC  Docket  No.  98-  1 
 to  Install  Fiber  Optic  Wholesale  )  Transport  Capacity  in  State  Freeway  ) 
 Rights-  of-  Way  )  ) 
 ) 

 MEMORANDUM  OPINION  AND  ORDER 
 Adopted:  December  20,  1999  Released:  December  23,  1999 
 By  the  Commission: 
 TABLE  OF  CONTENTS 
 Paragraph 
 Error!  No  table  of  contents  entries  found.  Our  conclusion  here  is  fully  consistent  with  the  New  England  Preemption  Order.  In  that  order  the  Commission  found  that  the  provision  of  payphones 
 was  a  telecommunications  service,  and  that  the  city's  restrictions  prohibited  a  class  of  carriers  from  providing  this  telecommunications  service  contrary  to  section  253(  a).  Whether  the  state  or 
 local  requirement  affected  the  provision  of  telecommunications  services  was  the  important  issue,  not  the  purported  subject  matter  of  the  restriction.  1  We  use  the  same  analysis  here  --  whether  the 
 requirement  has  the  effect  of  prohibiting  the  provision  of  any  telecommunications  service. 
 2.  The  Agreement  Creates  a  Legal  Requirement 

 1  In  the  New  England  Preemption  Order,  the  area  affected  by  the  state  legal  requirement  at  issue  --  the 
 provision  of  payphone  service  --  was  also  the  direct  subject  matter  of  the  state  requirement.  New  England  Preemption  Order,  11  FCC  Rcd  at  19720,    17-  18.  The  situation  here  is  somewhat  different.  Minnesota  argues 

 that  infrastructure  development  is  the  subject  directly  addressed  by  the  Agreement,  while  the  parties  challenging  the  Agreement  argue  that  it  will  affect  the  provision  of  telecommunications  services. 
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 1.  Similarly,  we  cannot  agree  with  ITS  America's  argument  that  the  Agreement  does  not  create  a  legal  requirement  to  which  section  253(  a)  could  apply.  As  we  understand  ITS 
 America's  filing,  ITS  America  asserts  that  section  253(  a)  would  not  be  violated  if  Minnesota  acquired  fiber  optic  capacity  for  its  own  purposes.  Because  Minnesota  could  contract  for  fiber 
 capacity  for  itself,  ITS  America  argues  that  Minnesota  also  has  the  authority  to  contract  out  the  management  of  its  rights-  of-  way  to  a  single  entity  on  an  exclusive  basis.  2  Therefore,  ITS 
 America  argues  that  section  253  limits  the  Commission  to  reviewing  Minnesota's  procurement  laws.  ITS  America  contends  that  the  Commission  does  not  have  the  authority  to  "review 
 contractual  arrangements  entered  into  between  the  State  and  private  parties  pursuant  to  the  lawful  exercise  of  its  unchallenged  procurement  laws  and  procedures  under  section  253."  3  Thus, 
 according  to  ITS  America  the  "only  'statute,  regulation  or  other  legal  requirement'  that  could  be  subject  to  section  253  scrutiny,  would  be  the  state's  procurement  laws  or  a  state  law  that  permits 
 the  state  or  municipality  to  offer  telecommunications  services  in  competition  with  commercial  telecommunications  service  providers."  4  In  other  words,  ITS  America  appears  to  be  arguing  that 
 the  Agreement  itself  does  not  create  a  legal  requirement  subject  to  section  253(  a). 
 2.  We  are  not  persuaded  by  ITS  America's  arguments.  We  conclude  that  the  Agreement  does  rise  to  the  level  of  a  "statute,  regulation,  or  legal  requirement,"  and  that  section 
 253(  a)  applies  to  the  Agreement  itself,  not  just  the  State's  procurement  laws.  5  Although  the  Agreement  is  not  a  statute  or  regulation,  it  grants  Developer  exclusive  physical  access  to  certain 
 freeway  rights-  of-  way.  Awarding  Developer  exclusive  physical  access  to  these  rights-  of-  way  as  part  of  a  contract  legally  binds  the  State  to  deny  other  entities  permits  for  access  to  these  freeway 
 rights-  of-  way.  Therefore,  the  Agreement  between  the  Developer  and  the  State  creates  a  "legal  requirement"  that  prevents  the  State  from  granting  potential  competitors  access  to  these  freeway 
 rights-  of-  way.  In  light  of  this,  we  see  no  reason  why  application  of  section  253(  a)  would  be  limited  to  Minnesota's  procurement  statutes  as  opposed  to  the  Agreement.  6 

 3.  We  conclude  that  Congress  intended  that  the  phrase,  "State  or  local  statute  or  regulation,  or  other  State  or  local  legal  requirement"  in  section  253(  a)  be  interpreted  broadly. 
 The  fact  that  Congress  included  the  term  "other  legal  requirements"  within  the  scope  of  section  253(  a)  recognizes  that  State  and  local  barriers  to  entry  could  come  from  sources  other  than 

 2  ITS  America  Reply  Comments  at  13. 
 3  ITS  America  Reply  Comments  at  12;  see  also  ICS/  UNC,  L.  L.  C.  Reply  Comments  at  3. 
 4  ITS  America  Reply  Comments  at  11-  13. 
 5  Petition  at  12. 
 6  NTCA  Comments  at  2. 
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 statutes  and  regulations.  7  The  use  of  this  language  also  indicates  that  section  253(  a)  was  meant  to  capture  a  broad  range  of  state  and  local  actions  that  prohibit  or  have  the  effect  of  prohibiting 
 entities  from  providing  telecommunications  services.  We  believe  that  interpreting  the  term  "legal  requirement"  broadly,  best  fulfills  Congress'  desire  to  ensure  that  states  and  localities  do 
 not  thwart  the  development  of  competition.  Our  conclusion,  that  Congress  intended  this  language  to  be  interpreted  broadly,  is  reinforced  by  the  scope  of  section  253(  d).  Section  253(  d) 
 directs  the  Commission  to  preempt  any  statute,  regulation,  or  legal  requirement  permitted  or  imposed  by  a  state  or  local  government  if  it  contravenes  sections  253(  a)  or  (b).  8  A  more 
 restrictive  interpretation  of  the  term  "other  legal  requirements"  easily  could  permit  state  and  local  restrictions  on  competition  to  escape  preemption  based  solely  on  the  way  in  which  action 
 was  structured.  We  do  not  believe  that  Congress  intended  this  result. 
 4.  As  discussed  above,  we  will  look  at  the  effect  of  the  state  or  local  government's  action  to  determine  whether  section  253  is  applicable.  In  this  case,  Minnesota  is  not  merely 
 acquiring  fiber  optic  capacity  for  its  own  use;  it  is  providing  a  private  party  with  exclusive  physical  access  to  the  freeway  rights-  of-  way.  The  fact  that  Developer  can  use  its  facilities  along 
 these  rights-  of-  way  to  provide  wholesale  telecommunications  capacity  to  others  and  retail  telecommunications  service  through  an  affiliate,  9  has  the  potential  to  adversely  affect 
 competitors  that  do  not  have  similar  access.  This  situation  is  very  different  from  a  traditional  government  procurement  of  telecommunications  facilities  or  services. 

 C.  Section  253(  a)  Analysis 
 5.  Minnesota  fails  to  show  that  the  Agreement  does  not  have  the  potential  to  violate  section  253(  a).  In  particular,  we  are  concerned  that  the  Agreement  has  the  potential  to  deprive 
 competitors  of  the  ability  to  compete  on  a  facilities  basis.  As  the  Commission  concluded  in  the  Texas  Preemption  Order,  such  a  restriction  would  violate  section  253(  a). 

 1.  Precedent  from  the  Texas  Preemption  Order 
 6.  In  the  Texas  Preemption  Order,  the  Commission  preempted  state-  imposed  build-out  requirements  on  two  separate  grounds.  10  First,  the  Commission  concluded  that  section 

 7  47  U.  S.  C.    253(  a). 
 8  47  U.  S.  C.    253(  d). 
 9  Agreement,  Section  3.  1(  b)(  vii,  ix);  see  also  Agreement,  Section  7.8. 
 10  Texas  law  required  that  certain  competitors  provide  telecommunications  services  using  their  own  facilities 
 or  those  of  other  new  entrants.  Before  the  end  of  the  first  year,  ten  percent  of  these  competitors'  service  territory  had  to  be  served  through  the  use  of  facilities  other  than  those  of  the  incumbent  LEC.  Before  the  end  of  the  third 

 year,  fifty  percent  of  their  service  territory  had  to  be  served  through  the  use  of  facilities  other  than  those  of  the 
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 253(  a)  bars  state  or  local  requirements  that  restrict  the  means  or  facilities  through  which  a  party  is  able  to  provide  service.  In  particular,  the  Commission  found  that  new  entrants  must  be  able  to 
 choose  whether  to  resell  incumbent  local  exchange  carrier  (LEC)  services,  obtain  incumbent  LEC  unbundled  network  elements,  utilize  their  own  facilities,  or  employ  any  combination  of 
 these  three  options.  The  Commission  reached  this  conclusion  by  reading  section  253(  a)  and  the  statutory  definition  of  "telecommunications  service"  together.  When  considered  together,  these 
 sections  provide  that  no  state  or  local  requirement  may  prohibit  or  have  the  effect  of  prohibiting  any  entity  from  providing  any  offering  of  telecommunications  directly  to  the  public  for  a  fee 
 regardless  of  the  facilities  used.  By  requiring  competing  carriers  to  provide  service  by  building  their  own  facilities,  the  Texas  law  precluded  the  other  forms  of  entry  contemplated  by  the  Act.  11 
 The  Commission  found  that  other  provisions  of  the  Act  supported  this  interpretation  of  section  253(  a).  12  As  a  second,  independent  basis  for  the  decision,  the  Commission  found  that 
 enforcement  of  the  build-  out  requirements  would  have  the  effect  of  prohibiting  certain  carriers  from  providing  any  telecommunications  service  contrary  to  section  253(  a)  because  "the 
 substantial  financial  investment"  required  to  meet  the  build-  out  requirement  effectively  precluded  any  entry  at  all.  13 

 7.  As  discussed  below,  our  concern  that  the  Agreement  may  have  the  effect  of  prohibiting  facilities-  based  entry  is  premised  on  evidence  in  the  record  that  utilizing  rights-  of-way 
 other  than  the  freeway  rights-  of-  way  to  install  telecommunications  infrastructure  is  substantially  more  expensive  than  using  the  freeway  rights-  of-  way.  The  evidence  in  the  present 
 record  precludes  us  from  concluding  that  the  Agreement  will  not  have  the  effect  of  prohibiting  facilities-  based  competition  because  of  the  availability  of  alternative  rights-  of-  way,  the  existence 

 incumbent  LEC.  Texas  Preemption  Order,  13  FCC  Rcd  at  3488,    57. 
 11  Texas  Preemption  Order,  13  FCC  Rcd  at  3496,    74;  see  also  Nextlink  Comments  at  6-  7;  NTCA 
 Comments  at  3;  NCTA  Comments  at  5-  6,  10-  11;  MCI  Comments  at  6;  ALTS  Comments  at  13  (citing  Texas  Preemption  Order,  13  FCC  Rcd  at  3521,    128);  MFS  Comments  at  15;  Time  Warner  Reply  Comments  at  7-  8. 

 12  More  specifically,  we  noted  that  section  251  allows  new  competitors  to  enter  the  market  using  the  three 
 entry  strategies  noted  above.  Id.  at  3496-  97,    75.  Section  271,  while  only  applicable  to  the  Bell  Operating  Companies,  also  requires  those  companies  to  make  all  three  entry  strategies  available  before  being  allowed  to 

 provide  in-  region,  inter-  LATA  services.  Our  interpretation  also  was  consistent  with  the  Eighth  Circuit's  opinion  in  Iowa  Utilities  Board.  In  discussing  section  251,  the  Eighth  Circuit  recognized  that  new  competitors  may  choose 
 resale,  access  to  unbundled  network  elements  or  access  to  interconnection  arrangements  offered  by  incumbent  LECs  as  an  entry  strategy  and  stated  that  "[  a]  company  seeking  to  enter  the  local  telephone  service  market  may  request  an 
 incumbent  LEC  to  provide  it  with  any  one  or  any  combination  of  these  three  services."  Iowa  Utils.  Bd.  v.  FCC,  120  F.  3d  753,  791  (8th  Cir.  1997),  rev'd  in  part,  aff'd  in  part,  AT&  T  Corp.  v.  Iowa  Utils.  Bd.,  119  S.  Ct.  721  (1999).  See 
 TCG  Comments  at  7  (citing  Implementation  of  the  Local  Competition  Provisions  in  the  Telecommunications  Act  of  1996,  First  Report  and  Order,  11  FCC  Rcd  15499,  15588,    172  (1996)(  Local  Competition  First  Report  and  Order). 

 13  Texas  Preemption  Order,  13  FCC  Rcd  at  3498,    78. 
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 of  excess  fiber  optic  capacity,  or  access  to  Developer's  capacity.  We  are  very  concerned  that  giving  Developer  exclusive  physical  access  to  rights-  of-  way  that  are  inherently  less  costly  to  use 
 has  the  potential  to  prevent  facilities-  based  entry  by  certain  other  carriers  that  cannot  use  these  rights-  of-  way.  This  would  be  inconsistent  with  section  253(  a)  and  the  Commission's  decision  in 
 the  Texas  Preemption  Order.  On  the  other  hand,  the  Agreement  could  be  implemented  in  a  manner  that  does  not  contravene  section  253(  a),  as  indicated  elsewhere.  14 

 2.  Alternative  Rights-  of-  Way 
 8.  Minnesota  fails  to  convince  us  that  the  existence  of  alternative  rights-  of-  way  means  that  the  Agreement  does  not  have  the  potential  to  prevent  certain  carriers  from  providing 
 facilities-  based  services.  Minnesota  argues  that,  although  the  Agreement  precludes  competitors  from  having  physical  access  to  freeway  rights-  of-  way,  carriers  wishing  to  provide 
 telecommunications  services  can  construct  their  own  fiber  optic  facilities  using  alternative  rights-  of-  way.  Parties  opposing  grant  of  the  Petition  claim  that  "there  are  distinct  cost 
 advantages  of  constructing  a  telecommunications  network  over  freeway  rights-  of-  way  in  Minnesota,  as  opposed  to  using  other  rights-  of-  way  that  are  purportedly  available  to 
 competitors."  15  These  commenters  claim  that  this  cost  differential  is  substantial  enough  to  make  it  infeasible  for  a  competitor  to  use  alternative  rights-  of-  way  to  provide  facilities-  based  services 
 in  competition  with  the  Developer  or  entities  using  Developer's  services.  Evidence  on  the  record  indicates  that  the  cost  of  using  the  alternative  rights-  of-  way  is  not  competitive  with  using  of  the 
 freeway  rights-  of-  way,  to  serve  communities  along  the  freeway's  route. 
 a.  Gas,  Electric,  and  Oil  Pipeline  Utility  Rights-  of-  Way 
 9.  The  record  does  not  support  Minnesota's  contention  that  utility  rights-  of-  way  offer  suitable  alternatives  to  use  of  the  freeway  rights-  of-  way.  Minnesota  claims  that  there  are 
 many  sources  of  alternative  rights-  of-  way  within  the  state,  16  including  utilities,  such  as  gas 
 14  See  infra  section  II,  C,  4. 

 15  MFS  Comments  at  14,  Declaration  of  Robert  Eide  at    7  (MFS,  Eide  Decl.);  MTA  Cosson  July  22  ex  parte 
 at  2  (citing  MEANS  v.  Minnesota):  see  GTE  at  8;  GVNW  at  6;  MTA  at  29-  30,  Ex.  4,  Affidavit  of  Kenneth  D.  Knuth  at  3-  11  (MTA,  Knuth  Aff.);  USTA  Joint  Reply  Comments  at  6-  7;  TCG  Reply  Comments  at  2;  US  West  Reply 

 Comments  at  5;  Letter  from  David  Cosson,  Kraskin,  Lesse  &  Cosson,  LLP,  to  Magalie  Roman  Salas,  Secretary,  Federal  Communications  Commission,  and  Carol  E.  Mattey,  Chief,  Policy  and  Program  Planning  Division,  Federal 
 Communications  Commission  at  3  (Dec.  22,  1998),  Kenneth  D.  Knuth  Affidavit  at    2-  7  (MTA,  Knuth  ex  parte  Aff.);  MFS  at  14;  Time  Warner  Reply  Comments  at  9-  10;  but  see  Minnesota  Reply  Comments  at  14-  16,  Ex.  3,  Fazil 
 Bhimani  Reply  Affidavit  at    4-  10  (Minnesota,  Bhimani  Reply  Aff.);  ICS/  UNC  Reply  Comments  at  4  (Arguing  that  requiring  Developer  to  collocate  third  party  fiber  "presents  an  opportunity  for  other  entities  to  defray 
 construction  costs  associated  with  the  installation  of  their  own  fiber  and  an  opportunity  for  smaller  providers  to  purchase  fiber  capacity  without  incurring  the  associated  facilities  build  out  costs."). 

 16  Since  the  freeway  rights-  of-  way  have  not  been  available  previously,  current  providers  of  fiber  optic 
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 pipelines,  oil  pipelines,  and  electric  power  lines.  17  Opponents  claim  that  these  utility  rights-  of-way  do  not  provide  a  practical  alternative  to  freeway  rights-  of-  way,  because:  (1)  other  than 
 electric  utilities,  they  are  under  no  legal  requirement  to  allow  telecommunications  providers  access  to  their  rights-  of-  way;  18  (2)  utilities  are  potential  competitors  who  may  not  want  to  share 
 their  rights-  of-  way  with  other  telecommunications  providers;  19  (3)  many  pipeline  companies  and  electric  utilities  lack  perfected  easements  that  would  allow  telecommunications  uses  of  the 
 property;  20  (4)  pipeline  companies  and  electric  utilities  seek  to  minimize  the  risk  of  accidents  by  locating  their  facilities  away  from  population  centers,  and,  as  a  result,  are  not  always  the  most 
 direct  route  between  population  centers;  21  and,  (5)  pipeline  companies  and  electric  utilities  may  also  deny  access  to  their  rights-  of-  way  for  safety  reasons  or  lack  of  space.  22  Minnesota  has  not 
 refuted  these  claims  by  its  opponents.  Therefore,  we  cannot  find  that  Minnesota  has  demonstrated  that  this  set  of  rights-  of-  way  provides  a  viable,  competitive  alternative  to  the 
 freeway  rights-  of-  way. 
 b.  Railroad  Rights-  of-  Way 
 transport  capacity  use  these  alternative  rights-  of-  way  and  several  are  in  the  process  of  constructing  additional  fiber  optic  transport  capacity  along  them.  Petition  at  23;  see  Petition,  Ex.  8,  Affidavit  of  Fazil  Bhimani  at    5-  7,  9,  13 
 (Minnesota,  Bhimani  Aff.). 
 17  Minnesota  claims  that  alternatives  include  thousands  of  miles  of  rights-  of-  way  in  Minnesota,  some  of 
 which  parallel  the  State's  freeway  system.  Petition  at  23-  24;  Petition,  Ex.  6,  Affidavit  of  Adeel  Lari  at    12-  13  (Lari  Aff.).  Minnesota  also  provides  maps  comparing  the  alternative  rights-  of-  way  with  the  freeway  rights-  of-  way. 

 Petition,  Exs.  12-  17. 
 18  MFS,  Eide  Decl.  at    18-  19;  NCTA  Comments  at  9;  ALTS  Comments  at  14;  Time  Warner  Reply 
 Comments  at  9;  but  see  47  U.  S.  C.    224(  f). 
 19  MFS,  Eide  Decl.  at    20. 

 20  MFS,  Eide  Decl.  at    19;  MTA  Knuth  Aff.  at    13;  GVNW  at  6;  Letter  from  David  Cosson,  Kraskin,  Lesse 
 &  Cosson,  LLP,  to  Magalie  Roman  Salas,  Secretary,  Federal  Communications  Commission,  (Jan.  15,  1999),  Kenneth  D.  Knuth  Supplemental  Affidavit  at    3  (MTA,  Knuth  Supp.  ex  parte  Aff.).  Lack  of  perfected  easements 

 would  require  a  telecommunications  provider  to  obtain  an  additional  easement  from  the  land-  owner,  a  potentially  expensive  and  time-  consuming  undertaking. 

 21  MFS,  Eide  Decl.  at    19;  MTA,  Knuth  Supp.  ex  parte  Aff.  at    3. 
 22  MFS,  Eide  Decl.  at    20;  MTA,  Knuth  Supp.  ex  parte  Aff.  at    4.  Section  224(  f)(  1)  of  the  Act  states:  "A 
 utility  shall  provide  .  .  .  any  telecommunications  carrier  with  nondiscriminatory  access  to  any  pole,  duct,  conduit,  or  right-  of-  way  owned  or  controlled  by  it."  47  U.  S.  C.    224(  f)(  1).  The  Commission  concluded  that  use  of  any  utility 

 pole,  duct,  conduit  or  right-  of-  way  for  wire  communications  triggers  access  to  all  poles,  ducts,  conduits,  and  rights-of-  way  owned  or  controlled  by  the  utility,  including  those  not  currently  used  for  wire  communications.  Local 
 Competition  First  Report  and  Order,  11  FCC  Rcd  at  16079-  80,    1173.  Neither  Minnesota  nor  any  of  the  comments  cite  to  section  224  in  response  to  opponents'  arguments. 
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 10.  There  is  also  conflicting  evidence  concerning  Minnesota's  claim  that  railroad  rights-  of-  way  provide  a  practical  alternative  for  facilities-  based  competitors.  The  MTA  asserts 
 that  the  railroads  charge  high  fees  for  access  to  their  rights-  of-  way.  23  The  MTA  also  states  that  railroad  crews  must  be  assigned  to  insure  the  safety  of  workers  installing  fiber  optic  cable.  In 
 addition,  it  asserts  that  installation  of  fiber  optic  facilities  takes  longer  because  work  must  be  stopped  when  trains  pass  through  construction  areas.  24  The  MTA  estimates  that  the  cost  of  using 
 railroad  rights-  of-  ways  is  twice  that  of  using  the  freeway  rights-  of-  way.  25  Minnesota  counters  these  arguments  by  stating  that  MCI  and  Sprint  have  installed  fiber  in  railroad  rights-  of-  way  in 
 Minnesota  and  that  Qwest  plans  to  install  fiber  throughout  the  nation  on  railroad  rights-  of-  way.  26  Prior  commercial  use  of  railroad  rights-  of-  way  does  not  demonstrate  that  granting  exclusive 
 physical  access  to  freeway  rights-  of-  way  will  not  have  the  effect  of  making  future  fiber  optic  construction  on  railroad  rights-  of-  way  economically  unattractive  in  Minnesota.  Indeed,  it 
 appears  that  some  entities  used  the  railroad  rights-  of-  ways  because  the  freeway  rights-  of-  way  were  not  available  and  it  was  easier  to  negotiate  the  necessary  access.  27  We  conclude  that 
 Minnesota  has  not  refuted  opponents'  claims  that  using  railroad  rights-  of-  way  would  be  substantially  more  expensive  than  using  the  freeway  rights-  of-  way  to  install  fiber. 

 c.  State  Trunk  Highway  Rights-  of-  Way 
 11.  Based  on  the  current  record,  we  cannot  agree  with  Minnesota  that  rights-  of-  way  on  state  trunk  highways  provide  a  reasonable,  competitive,  alternative  to  the  use  of  freeway 
 rights-  of-  way  for  the  installation  of  fiber  optic  facilities.  To  the  contrary,  the  record  demonstrates  that  freeway  rights-  of-  way  have  inherent  advantages  over  state  trunk  highway 
 rights-  of-  way.  Parties  challenging  the  Agreement  point  to  three  factors  that  make  it  more  efficient  and  less  expensive  to  use  the  freeway  rights-  of-  way:  (1)  it  is  less  expensive  and  less 
 time  consuming  to  negotiate  and  obtain  permission  to  use  freeway  rights-  of-  way;  (2)  freeways  connect  major  population  centers  more  directly  than  alternative  rights-  of-  way;  and,  (3)  it  is  less 
 expensive  to  install  fiber  on  freeway  rights-  of-  way  because  there  are  fewer  obstacles  such  as  cross  streets,  and  no  other  utilities  in  the  right-  of-  way,  for  example.  Each  of  these  differences  is 
 discussed  below. 
 23  See,  e.  g.,  MTA,  Knuth  Aff.  at    12;  MTA,  Knuth  Supp.  ex  parte  Aff.  at    2. 
 24  MTA,  Knuth  Aff.  at    12-  13;  MTA,  Knuth  Supp.  ex  parte  Aff.  at    2. 
 25  MTA,  Knuth  Supp.  ex  parte  Aff.  at    2. 
 26  Minnesota  Reply  Comments  at  18. 
 27  A  carrier  using  railroad  rights-  of-  way  would  only  have  to  negotiate  with  one  entity,  the  railroad,  rather 
 than  every  state  and  local  government  through  which  it  wishes  to  install  fiber.  See  infra  para.  0. 
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 12.  It  appears  that  it  would  be  more  costly  and  time-  consuming  to  obtain  permission  to  use  state  trunk  highway  rights-  of-  way  than  to  obtain  permission  to  use  the  freeway  rights-  of-way. 
 A  carrier  wishing  to  use  the  state  trunk  highway  system  would  need  to  negotiate  and  obtain  permits  from  MnDOT  and  all  of  the  municipalities  through  which  the  state  trunk  highway  passes 
 in  order  to  install  fiber  in  these  rights-  of-  way.  28  An  entity  using  the  freeway  rights-  of-  way  would  only  need  to  obtain  MnDOT's  approval.  In  this  regard,  we  note  that  at  least  two  requests 
 for  preemption  filed  with  the  Commission  have  involved  refusals  by  local  officials  to  grant  franchises  or  rights-  of-  way  permits  required  for  local  exchange  competition.  29 

 13.  It  also  appears,  based  on  the  present  record,  that  it  is  more  expensive  to  use  the  state  trunk  highway  rights-  of-  way  rather  than  the  freeway  rights-  of-  way  because  the  distance 
 between  major  population  centers  measured  along  state  trunk  highways  is  greater  than  the  distance  between  the  same  points  measured  along  the  freeways.  30  According  to  the  MTA,  the 
 distance  over  the  trunk  highway  routes  is  approximately  10  percent  greater  than  the  distance  over  the  freeway  routes.  31  As  a  result,  even  if  the  price  of  installing  fiber  on  both  types  of  rights-  of-way 
 is  the  same  per  mile  --  which,  as  discussed  below,  does  not  appear  to  be  the  case  --  the  cost  of  using  state  trunk  highway  rights-  of-  way  would  be  greater  because  the  routing  of  the  state 
 trunk  highway  is  less  direct  than  the  routing  of  the  freeways. 
 28  MFS,  Eide  Decl.  at    11;  Ameritech  Comments  at  2;  KMC  Comments  at  6:  MTA  Comments  at  27-  28; 
 Time  Warner  Reply  Comments  at  9-  10.  According  to  the  MFS  expert,  "the  Developer  will  not  become  entangled  in  the  elaborate  permitting  processes  that  delay  carriers  using  other  rights-  of-  way.  .  .  .  With  other  rights-  of-  way, 

 carriers  often  find  themselves  mired  in  a  variety  of  different  negotiations  involving  multiple  land  owners,  utilities,  and/  or  municipalities.  These  negotiations  can  be  expensive  and  time-  consuming."  MFS,  Eide  Decl.  at    11;  but  see 
 Minnesota  Reply  Comments  at  14  ("  Some  opponents  argue  that  the  costs  and  delays  in  obtaining  multiple  permits  from  municipalities  represents  a  significant  cost  advantage.  Yet  no  quantification  of  this  advantage  has  been 
 noted."). 
 29  Classic  Telephone,  Petition  for  Preemption,  Declaratory  Ruling  and  Injunctive  Relief,  Memorandum 
 Opinion  and  Order,  11  FCC  Rcd  13082  (1996)(  Classic  Preemption  Order);  Chibardun  Telephone  Cooperative,  Inc.,  Petition  for  Preemption  Pursuant  to  Section  253  of  the  Communications  Act,  Order,  13  FCC  Rcd  9504  (1998). 

 We  also  note  that  we  have  recently  begun  an  inquiry  into  state  and  local  governments'  policies  regarding  telecommunications  service  providers'  access  to  public  rights-  of-  way  and  how  those  policies  may  be  affecting 
 competition.  Promotion  of  Competitive  Networks  in  Local  Telecommunications  Markets,  Notice  of  Proposed  Rulemaking  and  Notice  of  Inquiry  in  WT  Docket  No.  99-  217  and  Third  Further  Notice  of  Proposed  Rulemaking  in 
 CC  Docket  No.  96-  98,  FCC  99-  141,  paras.  70-  80  (rel.  July  7,  1999). 
 30  Ameritech  Comments  at  2;  MTA,  Knuth  Aff.  at    11;  see  US  West  Comments  at  13;  TCG  Comments  at 
 19;  Nextlink  at  3;  KMC  Comments  at  6. 
 31  For  example,  the  state  trunk  highway  route  between  Minneapolis  and  Fargo-  Moorhead  is  7.6  percent 
 longer  than  the  freeway  route  between  these  cities.  The  state  trunk  highway  route  between  Minneapolis  and  Duluth  is  14.8  percent  longer  than  the  freeway  route.  MTA,  Knuth  Aff.  at    11. 
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 14.  It  also  appears  to  be  more  expensive  to  install  fiber  optic  transmission  facilities  along  the  state  trunk  highway  system  than  it  is  to  use  freeway  rights-  of-  way.  32  Opponents  of  the 
 Agreement  note  that  freeways  are  controlled-  access  roadways  with  relatively  little  interference  from  cross-  streets  and  other  obstacles,  33  such  as  sewer  lines,  electric  lines,  gas  pipes,  or  other 
 objects  buried  in  the  rights-  of-  way.  34  Because  there  are  fewer  obstacles,  using  the  freeway  rights-  of-  way  will  require  less  engineering  and  planning  than  use  of  the  state  trunk  highway 
 rights-  of-  way.  35 
 d.  Cost  Studies 
 15.  Both  Minnesota  and  the  MTA  submit  cost  studies  to  support  their  respective  positions  on  the  cost  differential  between  using  freeway  rather  than  state  trunk  highway  rights-of- 
 way.  Based  on  the  evidence  in  the  record,  we  are  unable  to  determine  whether  the  cost  difference  would  prevent  the  provision  of  telecommunications  services  by  certain  entities. 

 16.  At  the  outset,  we  cannot  accept  Minnesota's  assertion  that  cost  comparisons  must  reflect  Developer's  state-  wide  transmission  network,  including  installation  costs  for  both  rural 
 and  urban  areas.  In  determining  whether  the  Agreement  could  have  the  effect  of  prohibiting 
 32  According  to  the  MTA  expert,  in  rural  areas  it  would  cost  $1.08  per  foot  to  install  fiber  on  the  freeway 
 right-  of-  way  and  $1.23  per  foot  to  install  fiber  on  the  state  trunk  highway  right-  of-  way.  MTA,  Knuth  Aff.  at    5-  6;  but  see  Letter  from  Dennis  D.  Ahlers,  Assistant  Attorney  General,  State  of  Minnesota,  to  Magalie  Roman  Salas, 

 Secretary,  Federal  Communications  Commission,  and  Carol  E.  Mattey,  Chief,  Policy  and  Program  Planning  Division,  Federal  Communications  Commission  (Feb.  22,  1999),  Fazil  Bhimani  Affidavit  at    4  (Minnesota, 
 Bhimani  ex  parte  Aff.)(  Challenging  some  of  the  MTA  expert's  underlying  assumptions.)  As  a  result,  in  rural  areas,  the  cost  of  using  the  freeway  right-  of-  way  would  be  $5,853.00  per  mile  and  the  cost  of  using  state  trunk  highway 
 rights-  of-  way  would  be  $6,763.00  per  mile.  Although  the  MTA  expert  asserts  that  it  is  much  more  difficult  to  estimate  the  cost  of  installing  fiber  in  town  and  city  areas,  he  estimates  that  the  cost  of  installing  fiber  in  "town" 
 areas  using  the  state  trunk  highway  system  is  $3.03  per  foot  or  $16,344  per  mile,  and  the  estimate  for  installing  fiber  in  cities  of  over  2,000  people  is  $4.22  per  foot  and  $22,788  per  mile.  MTA,  Knuth  Aff.  at    5-  8.  The  MTA  expert 
 estimates  that  a  route  along  a  state  highway  system  would  require  15  percent  "town  type  construction"  and  85  percent  rural  construction.  The  freeway  route  does  not  pass  directly  though  such  towns,  and  would  be  less  costly  to 
 use  in  this  regard. 
 33  Ameritech  Comments  at  2;  MTA,  Knuth  Aff.  at    3. 

 34  Ameritech  Comments  at  2;  USTA  Joint  Comments  at  10;  KMC  Comments  at  6;  MTA  Comments  at  26; 
 MTA  Knuth  Aff.  at    3;  MTA,  Knuth  ex  parte  Aff.  at    4;  MFS,  Eide  Decl.  at    12  (Freeways  have  "controlled"  or  limited  access  which  minimizes  intersections,  so  the  Developer  can  lay  cable  for  miles  without  interruption. 

 Furthermore,  the  Developer  would  not  have  to  use  extraordinary  measures  to  work  around  natural  or  man-  made  obstacles  because  freeway  builders  generally  have  already  resolved  such  problems.) 

 35  MTA,  Knuth  ex  parte  Aff.  at    4. 
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 "any  entity"  from  providing  telecommunications  service,  we  conclude  that  it  is  appropriate  to  consider  point-  to-  point  cost  comparisons  since  a  competitor  may  wish  to  use  the  freeway  rights-of- 
 way  for  particular  point-  to-  point  connections.  For  example,  a  local  exchange  carrier  may  wish  to  use  the  freeway  rights-  of-  way  to  connect  its  existing  switch  to  facilities  in  another 
 exchange  in  order  to  provide  competitive  local  exchange  service.  Other  carriers  may  only  be  interested  in  providing  facilities-  based  services  to  specific  areas.  For  such  carriers,  the  relevant 
 consideration  in  determining  whether  they  can  compete  effectively  in  providing  such  service  is  a  point-  to-  point  comparison.  Therefore,  in  conducting  this  analysis,  we  will  compare  the  cost  of 
 installing  capacity  between  specific  points  utilizing  freeway  rights-  of-  way  versus  using  state  trunk  highway  rights-  of-  way  between  the  same  points,  and  not  Developer's  cost  of  installing  a 
 fiber  network  in  Minnesota.  36 
 17.  Minnesota  fails  to  convince  us  that  the  cost  differential  between  using  the  state  trunk  highway  rights-  of-  way  and  the  freeway  rights-  of-  way  for  the  installation  of  fiber  optic 
 facilities  will  be  insubstantial  when  considered  in  the  context  of  the  competitive  telecommunications  industry,  and  thus  unlikely  to  adversely  affect  entry  decisions.  MTA  and 
 MFS  assert  that  the  cost  of  installing  fiber  along  the  freeway  is  approximately  30  percent  less  than  the  cost  of  installing  fiber  along  the  state  trunk  highway.  37  Minnesota  appears  to  concede 
 that  the  cost  differential  for  fiber  installation  is  between  11  and  21  percent.  38 
 18.  Moreover,  these  cost  studies  do  not  attempt  to  quantify  all  of  the  advantages  of  using  the  freeway  rights-  of-  way.  For  example,  they  do  not  reflect  the  effect  of  the  administrative 

 36  This  analysis  comports  with  the  MTA  expert  who  states  that:  "Many  potential  customers  will  also  need 
 capacity  on  only  a  portion  of  the  Network.  The  recent  collocation  arrangement  between  the  [Developer]  and  McLeod  demonstrates  that  customers  are  often  interested  in  specific  routes,  for  which  the  [Developer]  will  have  a 

 significant  cost  advantage,  and  are  not  interested  in  using  the  [Developer's]  full  Network.  As  a  result,  the  cost  advantages  for  different  segments  .  .  .  are  the  proper  focus  for  installation  cost  analysis."  MTA,  Knuth  ex  parte  Aff. 
 at    5.  Strategic  Policy  Research  (SPR)  concludes  that  "the  relevant  market  is  the  set  of  points  served  by  the  interstate  freeway  system  in  Minnesota.  SPR  also  argues  that  we  used  a  point-  to-  point  comparison  in  two  orders. 
 MTA  ex  parte,  Strategic  Policy  Research  at  1-  2  (citing  Regulatory  Treatment  of  LEC  Provision  of  Interexchange  Services  Originating  in  the  LEC's  Local  Exchange  Area  and  Policy  and  Rules  Concerning  the  Interexchange 
 Marketplace,  Second  Report  and  Order;  CC  Docket  96-  149;  Third  Report  and  Order,  CC  Docket  960-  61  at    64-  69  (1997);  International  Competitive  Carrier  Policies,  Report  and  Order,  102  FCC  2d  812  (1985)). 

 37  MFS,  Eide  Decl.  at    14;  MTA,  Knuth  ex  parte  Aff.  at    6.  The  MTA  expert  estimates  a  cost  differential  of 
 approximately  30.57  percent  based  on  a  comparison  of  the  cost  of  installing  fiber  between  Minneapolis  and  Fargo.  The  MTA  expert  estimates  a  cost  differential  of  approximately  39.41  percent  for  installing  fiber  between 

 Minneapolis  and  Duluth.  MTA,  Knuth  ex  parte  Aff.  Table  2.  MFS  estimates  that  the  Developer's  costs  "can  be  at  least  30  percent  less  than  the  costs  competitors  will  experience  in  attempting  to  access  alternative  rights-  of-  way." 
 MFS,  Eide  Decl.  at    14.  MFS  does  not  provide  underlying  documentation  to  support  this  assertion. 
 38  Minnesota,  Bhimani  ex  parte  Aff.    7. 
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 costs  and  delays  of  having  to  obtain  multiple  permits  from  multiple  localities  when  using  the  trunk  highway  system.  39  We  also  note  that  using  the  freeway  rights-  of-  way  may  improve 
 reliability  and  lessen  maintenance  costs  since  fiber  installed  on  the  freeway  rights-  of-  way  is  less  likely  to  be  unintentionally  cut  because  the  right-  of-  way  is  not  shared  with  other  users.  For  a 
 carrier  wishing  to  provide  competitive  local  exchange  service  from  a  remote  switch,  the  reliability  of  the  connection  to  the  remote  switch  could  be  critical.  A  cut  in  this  cable  could 
 result  in  widespread  service  disruptions  for  its  customers. 
 19.  Minnesota  also  argues  that  the  cost  differential  claimed  by  MTA  shrinks  to  a  negligible  amount  once  the  Developer's  full  costs  are  taken  into  account.  Pursuant  to  the 
 Agreement,  Developer  will  provide  the  state  with  a  variety  of  benefits,  including  at  least  20  percent  of  the  network's  lit  capacity  as  well  as  some  dark  fiber  without  charge.  The  Developer 
 must  also  bear  maintenance  costs,  provide  up  to  $5  million  worth  of  facilities  and  services  for  Minnesota's  ITS  applications  and  lay  fiber  in  "less  profitable"  rural  areas.  The  Developer  must 
 also  pay  prevailing  wage  rates,  which  competing  companies  do  not.  According  to  the  state,  when  all  of  these  costs  are  included,  the  Developer  will  not  have  a  cost  advantage  over  carriers 
 utilizing  other  rights-  of-  way. 
 20.  We  cannot  agree  with  this  analysis.  We  believe  the  appropriate  comparison  must  be  between  what  it  would  cost  an  efficient  carrier  to  provide  facilities-  based  services  using 
 freeway  rights-  of-  way  versus  state  trunk  highways.  We  do  not  believe  that  it  is  appropriate  to  include  in  this  comparison  the  additional  cost  of  the  benefits  that  the  state  is  able  to  extract  from 
 Developer  only  in  exchange  for  granting  exclusive  physical  access  to  these  valuable  freeway  rights-  of-  way.  Indeed,  the  state's  argument  that  the  Developer's  costs  should  reflect  these 
 benefits  is  premised  on  the  state's  position  that  it  would  not  permit  anyone  to  use  the  freeway  rights-  of-  way  unless  they  agreed  to  provide  the  requested  benefits.  We  believe  such  an 
 extraction  of  benefits  in  exchange  for  exclusive  physical  access  to  rights-  of-  way  is  fundamentally  inconsistent  with  the  1996  Act,  which  endeavors  to  replace  exclusive  monopoly 
 rights  with  open  competition. 
 21.  Moreover,  it  would  be  an  ironic  result  if  a  state  could  seek  to  avoid  a  finding  of  a  potential  section  253(  a)  violation  through  the  expedient  of  claiming  it  may  impose  excessive 
 requirements  on  users  of  public  rights-  of-  way.  Section  253(  c)  was  specifically  designed  to  avoid  such  a  result.  That  section  permits  states  and  local  governments  to  avoid  preemption  for  section 
 253(  a)  violations  when  the  state  or  local  government's  management  of  public  rights-  of-  way  are  implicated,  and  the  state  requires  "fair  and  reasonable  compensation  from  telecommunication 
 providers  .  .  .  for  use  of  public  rights-  of-  way  on  a  nondiscriminatory  basis."  40  We  do  not  believe 
 39  See  supra  para.  27. 
 40  47  U.  S.  C.    253(  c). 
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 that  the  benefits  extracted  in  exchange  for  access  to  the  freeway  rights-  of-  way  in  this  instance  meet  the  "fair  and  reasonable  compensation"  standard  laid  out  in  section  253(  c).  41 
 3.  Existing  Fiber  Capacity  and  the  Ability  to  Expand  It 
 22.  We  also  disagree  with  Minnesota's  contention  that  the  Agreement  is  consistent  with  section  253(  a)  of  the  Act  because  competitors  can  readily  obtain  fiber  optic  capacity  on 
 existing  networks  and  resell  it.  In  support  of  this  assertion,  Minnesota  argues  that  there  is  excess  fiber  optic  capacity  in  Minnesota,  and  that  current  capacity  can  be  expanded.  42  Minnesota 
 asserts  that  only  15  percent  of  the  fiber  optic  capacity  in  Minnesota  is  lit.  Furthermore,  the  State  argues  that  the  most  cost-  effective  means  of  increasing  capacity  is  to  upgrade  the  electronics  on 
 existing  systems,  rather  than  install  new  fiber.  43  As  a  result,  Minnesota  argues  that  current  competitors  will  not  face  capacity  constraints  and  that  new  entrants  will  be  able  to  obtain 
 transport  capacity  for  resale  from  Developer  and  other  providers  at  competitive  market-  based  prices.  44 

 23.  This  argument,  however,  only  addresses  the  potential  for  entry  through  resale.  As  discussed  above,  we  believe  that  section  253(  a)  bars  state  or  local  action  that  makes  any  of  the 
 three  entry  methods  unavailable  to  competitors.  45  Minnesota's  argument  that  current  providers  can  expand  capacity  at  less  cost  than  installing  new  fiber  does  not  address  the  potential  adverse 
 effect  of  the  Agreement  on  new  entrants  that  wish  to  provide  telecommunications  service  by  constructing  their  own  facilities.  46  Nor  would  Minnesota's  argument  address  the  effect  of  the 

 41  Bell  Atlantic  -  Maryland,  Inc.  v.  Prince  George's  County,  Maryland,  49  F.  Supp.  2d  805,  817-  19  (D.  Md. 
 May  24,  1999),  appeal  pending;  AT&  T  Communications  of  the  Southwest,  Inc.  v.  City  of  Dallas,  8  F.  Supp.  2d  582,  593  (N.  D.  Tex.  1998)(  granting  preliminary  injunction);  AT&  T  Communications  of  the  Southwest,  Inc.  v.  City  of 

 Dallas,  52  F.  Supp.  2d  763,  769-  770  (N.  D.  Tex.  1999)(  granting  final  declaratory  and  permanent  injunctive  relief);  MTA,  Cosson  July  22  ex  parte  at  4;  but  see  Minnesota,  Ahlers  Sept.  14  ex  parte  at  3-  4  (arguing  that  the  above-mentioned 
 cases  are  distinguishable  from  these  facts  because  the  cases  involve  (1)  cities  regulating  rights-  of-  way  rather  than  states;  (2)  certificated  carriers  not  a  carrier's  carrier;  (3)  the  payment  of  fees  while  none  is  demanded 
 here;  and  (4)  already  used  rights-  of-  way,  unlike  the  rights-  of-  way  in  this  case.) 
 42  Petition  at  21;  but  see  RCN  Comments  at  6  (outside  of  urban  areas  only  ILECs  and  AT&  T  have  facilities 
 available  for  resale).  The  State  currently  purchases  fiber  backbone  services  from  MCI  which  uses  its  own  facilities  and  those  of  MEANS.  AT&  T  operates  a  fiber  optic  network  in  Minnesota.  US  West  has  deployed  fiber  in 

 Minnesota  as  have  interexchange  carriers  such  as  MCI,  U.  S.  Link,  and  Wiltel.  In  1994  there  were  an  estimated  7,265  sheath  kilometers  of  fiber  in  Minnesota.  Petition  at  21. 

 43  Minnesota,  Bhimani  Aff.  at    10-  12;  Minnesota  Reply  Comments  at  11-  12. 
 44  Petition  at  22-  23. 
 45  See  47  U.  S.  C.    253(  a);  Texas  Preemption  Order,  13  FCC  Rcd  at  3496,    74. 
 46  ALTS  Comments  at  13  ("[  T]  he  existence  of  other  sources  from  which  a  carrier  could  obtain  [resold] 
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 Agreement  on  an  existing  telecommunications  service  provider  that  wishes  to  expand  the  geographic  scope  of  its  facilities.  The  existence  of  spare  fiber  optic  capacity  merely  indicates 
 that  new  entrants  will  be  able  to  lease  fiber  optic  capacity  from  other  providers  for  the  purpose  of  resale,  and  that  current  facilities-  based  providers  will  be  able  to  expand  the  capacity  on  existing 
 routes. 
 4.  Making  the  Agreement  "Functionally  Non-  Exclusive" 
 24.  We  conclude  that  Minnesota  has  not  demonstrated  that  the  Agreement  imposes  requirements  on  the  Developer  that  will  have  the  effect  of  making  the  Agreement  "functionally 
 non-  exclusive,"  47  i.  e.,  that  it  would  not  "have  the  effect  of  prohibiting  the  ability  of  any  entity  to  provide  any  .  .  .  telecommunications  services,"  and  therefore  would  not  contravene  section 
 253(  a).  48  Minnesota  argues  that  the  Agreement  is  "functionally  non-  exclusive"  because  it  requires  the  Developer  to  install  collocated  fiber  for  third  parties  49  and  lease  or  sell  network 
 capacity  50  to  telecommunications  providers  on  a  nondiscriminatory  basis.  In  light  of  these  safeguards,  Minnesota  contends  that  the  restriction  on  physical  access  to  freeway  rights-  of-  way 
 does  not  prevent  any  entity  from  offering  telecommunications  services,  and  instead  enhances  the  competitiveness  of  the  market  by  making  available  a  new  source  of  fiber  optic  transport.  51 

 25.  The  safeguards  contained  in  the  Agreement  represent  a  laudable  effort  to  reduce  the  potential  anti-  competitive  effects  of  the  Agreement.  As  discussed  above,  however,  section 
 253(  a): 
 bars  state  and  local  requirements  that  restrict  the  means  or  facilities  through  which  a  party  is  permitted  to  provide  service,  i.  e.,  new  entrants  should  be  able  to 

 capacity  does  nothing  for  the  carrier  with  a  facilities-  based  business  plan"). 
 47  Petition  at  24;  see  Universal  Communication  Networks  Reply  Comments  at  4;  ICS/  UNC,  L.  L.  C.  Reply 
 Comments  at  4. 
 48  47  U.  S.  C.    253(  a). 

 49  Petition  at  24,  26;  Agreement,  Section  7.  7,  5.  12;  see  Universal  Communication  Networks,  LLC  Reply 
 Comments  at  2. 
 50  Petition  at  24-  26;  Agreement,  Section  7.  7;  see  Universal  Communication  Networks,  LLC  Reply  Comments 
 at  2;  ITS  America  Reply  Comments  at  20.  Network  capacity,  as  opposed  to  collocated  fiber,  refers  to  the  fiber  the  Developer  installs  on  its  own  behalf.  The  Developer  can  sell  or  lease  unlit  network  capacity,  i.  e.,  dark  fiber,  or  lit 

 network  capacity.  Petition  at  26. 
 51  Petition  at  26;  Minnesota,  Ahlers  June  16  ex  parte  at  2;  but  see  MFS  Comments  at  12  (Arguing  that 
 Developer  has  acquired  the  ability  to  veto  new  entrants's  applications  to  get  access  to  these  rights-  of-  way.). 
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 choose  whether  to  resell  incumbent  LEC  services,  obtain  incumbent  LEC  unbundled  network  elements,  utilize  their  own  facilities,  or  employ  any 
 combination  of  these  three  options.  52 
 Nonetheless,  there  is  some  ambiguity  in  the  safeguards  contained  in  the  Agreement.  Accordingly,  we  are  unable  to  determine  at  this  time  if  the  Agreement  prevents  other  facilities-based 
 providers  from  providing  telecommunications  services. 
 a.  Installation  of  Third  Party  Fiber 
 26.  Requiring  the  Developer  to  install  fiber  for  other  carriers  when  it  installs  its  own  fiber,  does  not  fully  overcome  the  Agreement's  shortcomings.  53  The  primary  problem  with  this 
 solution  is  that  the  opportunity  to  collocate  fiber  is  very  limited.  54  In  order  to  collocate  fiber  a  competitor  must  enter  into  a  "User  Agreement"  with  Developer  before  Developer  begins 
 installing  fiber.  55  If  a  competitor  is  unable  to  do  this  before  the  trench  is  closed,  that  competitor  will  be  excluded  from  collocating  fiber  in  the  freeway  right-  of-  way  for  a  period  of  at  least  ten 
 years.  56  During  this  ten  year  period  we  expect  new  carriers  to  be  formed,  and  existing  carriers  to  expand.  Keeping  the  freeway  rights-  of-  way  closed  for  at  least  ten  years  will  have  a  particularly 
 adverse  impact  on  the  ability  of  to-  be-  formed,  start-  up,  and  expanding  carriers  to  offer  telecommunications  services  in  Minnesota  because  they  will  be  unable  to  place  facilities  in  the 
 most  efficient  rights-  of-  way.  The  ten  year  restriction  forces  new  entrants  to  use  more  expensive  rights-  of-  way,  provide  service  through  resale,  or  "purchase"  fiber  from  Developer.  In  comments, 
 but  not  the  Agreement,  Minnesota  claims  that  new  entrants  can  purchase  capacity  on  an  indefeasible  right  of  user  (IRU)  basis.  57  The  Agreement,  however,  does  not  sufficiently  spell  out 

 52  Texas  Preemption  Order,  12  FCC  Rcd  at  3496,    74. 
 53  Section  5.  12  requires  the  Developer  to  install  fiber  optic  capacity  on  behalf  of  those  entities  who  contract 
 with  the  Developer  to  install  such  capacity  before  Developer  lays  its  own  facilities.  Developer  will  install  third  party  (collocated)  fiber  at  the  same  time  it  installs  its  own  fiber.  Agreement,  Section  5.  12;  see  Universal 

 Communication  Networks  Reply  Comments  at  2,  3. 
 54  SBC  Comments  at  4;  see  USTA  Joint  Comments  at  9,  15;  TCG  Comments  at  17;  RCN  Comments  at  5; 
 Nextlink  at  4,  8-  9  (late-  comers  will  be  relegated  to  resale  only  with  its  lack  of  control);  NCTA  Comments  at  10,  11  (new  entrants  must  rely  upon  the  network  of  incumbents);  MCI  Comments  at  6;  GTE  Comments  at  6;  NYSTA 

 Comments  at  3;  ALTS  Comments  at  12;  MFS  Comments  at  29;  Time  Warner  Reply  Comments  at  7. 
 55  Agreement,  Section  5.12(  c).  See  ALTS  Comments  at  12;  MFS  Comments  at  29;  GTE  Comments  at  6; 
 TCG  Comments  3,  n.  2,  11-  12;  RCN  Comments  at  3;  MCI  Comments  at  6;  KMC  Comments  at  4. 
 56  ALTS  Comments  at  12;  see  USTA  Joint  Comments  at  9,  15;  SBC  at  4;  RCN  Comments  at  3;  MFS 
 Comments  at  29. 
 57  Minnesota,  Ahlers  June  16  ex  parte  at  1;  see  supra  Section  II,  C,  3;  SBC  Comments  at  4.  As  defined  by 
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 the  obligations  of  Developer  in  providing  capacity  to  interested  parties. 
 b.  Availability  of  Network  Capacity  for  Purchase  or  Resale 
 27.  Based  on  the  present  record,  we  cannot  conclude  that  the  Agreement  requires  that  Developer  to  sell  network  capacity  in  a  manner  that  makes  the  Agreement  functionally  non-exclusive. 
 Minnesota  argues  that  sections  7.7  and  7.8  of  the  Agreement  require  the  Developer  to  sell  both  lit  and  unlit  network  capacity,  stating  that  the  "unlit  network  capacity  is  similar  to  the 
 bulk  capacity  made  available  on  an  IRU  basis."  58  It  is  possible  that  under  certain  circumstances,  the  ability  of  interested  parties  to  purchase  facilities  on  an  IRU  basis  might  be  an  adequate 
 substitute  for  the  ability  to  construct  facilities  along  a  particular  route.  The  present  record,  however,  does  not  demonstrate  that  this  is  the  case.  The  language  of  the  Agreement  does  not 
 clearly  state  whether  the  Developer  must  sell  lit  or  unlit  capacity  on  an  IRU  basis.  59  Even  if  interested  parties  are  able  to  purchase  capacity  in  Developer's  network,  the  present  record  does 
 not  establish  that  this  would  be  an  adequate  substitute  for  the  ability  to  construct  facilities  along  the  freeway  rights-  of-  way.  60  For  example,  we  do  not  know  whether  the  Developer  will  charge 

 the  Commission,  "[  a]  n  IRU  interest  in  a  communications  facility  is  a  form  of  acquired  capital  in  which  the  holder  possesses  an  exclusive  and  irrevocable  right  to  use  the  facility  and  to  include  its  capital  contribution  in  its  rate  base, 
 but  not  the  right  to  control  the  facility  or,  depending  on  the  particular  IRU  contract,  any  right  to  salvage  .  .  .  .  The  IRU  is  conveyed  by  a  facility  co-  owner  to  a  carrier  that  did  not  elect  to  become  a  facility  co-  owner  or  that  as  a 
 facility  co-  owner  did  not  purchase  sufficient  capacity  to  meet  its  projected  demand  over  the  life  of  the  facility."  See  Reevaluation  of  the  Depreciated-  Original-  Cost  Standard  in  Setting  Prices  for  Conveyances  of  Capital  Interests  in 
 Overseas  Communications  Facilities  Between  or  Among  U.  S.  Carriers,  CC  Docket  No.  87-  45,  Report  and  Order,  7  FCC  Rcd  4561,  4561  n.  1  (1992),  recon.  8  FCC  Rcd  4173  (1993). 

 58  Petition  at  26;  Universal  Communication  Networks  Reply  Comments  at  2;  Minnesota,  Ahlers  June  16  ex 
 parte  at  1;  Minnesota,  Ahlers  Sept.  14  ex  parte  at  4;  but  see  MTA,  Cosson  July  22  ex  parte  at  8  (arguing  that  the  Agreement  does  not  contain  a  contractual  obligation  to  provide  fiber  on  an  IRU  basis).  Minnesota  Claims  that, 

 pursuant  to  Section  2.74  of  the  Agreement,  the  Developer  will  "enter  into  'User  Agreements'  under  which  [a]  third  party  can  acquire  'rights  of  use  or  access  to  [Developer's]  Network."  As  a  result  Minnesota  argues  that  "the 
 Developer  is  obligated  to  offer  use  of  and  access  to  [Developer's]  Network"  on  an  IRU  basis,  and  will  give  all  telecommunications  providers  an  opportunity  to  purchase  capacity  on  a  nondiscriminatory  basis."  Minnesota, 
 Ahlers  June  16  ex  parte  at  1;  Minnesota,  Ahlers  Sept.  14  ex  parte  at  4. 
 59  Letter  from  David  Cosson,  Kraskin,  Lesse  &  Cosson,  LLP,  to  Carol  E.  Mattey,  Chief,  Policy  and  Program 
 Planning  Division,  Federal  Communications  Commission  (April.  21,  1999)  at  1;  see  also  Time  Warner  Reply  Comments  at  8. 

 60  See  Nextlink  Comments  at  4,  8-  9  (late-  comers  will  be  relegated  to  reselling  and  its  lack  of  control);  NCTA 
 Comments  at  10  (new  entrants  will  be  forced  to  rely  upon  the  facilities  of  incumbents);  MFS  Comments  at  11  (Developer  controls  cost  and  quality  of  construction);  see  also  KMC  Comments  at  4  ("  Congress  clearly  recognized 

 [that]  a  competitor's  ability  to  buy  transport  capacity  from  a  wholesaler  .  .  .  is  not  the  same  as  that  competitor  having  proprietary  development  of  control  over  its  own  facilities."  Id.  at  5.);  Time  Warner  Reply  Comments  at  8. 
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 rates,  terms,  and  conditions  that  are  just  and  reasonable.  Although  it  is  possible  that  the  presence  of  collocated  fiber  owned  by  third  parties  or  other  fiber  capacity  in  the  state  would  serve  as  a 
 competitive  restraint  on  the  prices  Developer  could  charge  for  capacity,  we  cannot  determine  beforehand  if  this  will  be  the  case. 

 28.  Furthermore,  the  record  does  not  adequately  address  whether  the  ability  to  obtain  fiber  on  an  IRU-  like  basis  is  an  adequate  substitute  for  physical  access  to  the  freeway  rights-  of-way. 
 Regardless  of  whether  a  competitor  collocates  or  "purchases"  fiber  from  Developer,  it  will  not  be  able  to  access  the  facility  to  maintain  and  repair  it.  61  Several  commenters  argue  that  the 
 ability  to  maintain  and  repair  their  own  fiber  is  important  to  ensure  quality  of  service  and  limit  costs.  62  Nevertheless,  it  is  possible  that  this  drawback  is  not  significant  because  fiber  optic  cable 
 generally  requires  little  maintenance  and  the  likelihood  of  a  cable  cut  along  this  right-  of-  way  is  relatively  low.  Moreover,  Minnesota  suggests  that  carriers  currently  swap  capacity  on  fiber 
 optic  transport  networks.  63  The  present  record,  however,  is  not  adequate  to  allow  us  to  conclude  that  the  ability  of  interested  parties  to  collocate  fiber  or  purchase  facilities  on  an  IRU  basis  is  an 
 adequate  substitute  for  the  ability  to  construct  facilities. 
 c.  Availability  of  Conduit 
 29.  The  availability  of  conduit  space,  through  which  competitors  could  pull  their  own  fiber,  may  also  ameliorate  the  anticompetitive  effects  of  limiting  physical  access  to  the  freeway 
 rights-  of-  way  to  one  provider  for  a  period  of  ten  years.  Minnesota  claims  that  "[  a]  ny  carrier  has  the  opportunity  to  purchase  access  [to]  either  the  fiber-  optic  in  the  conduit  owned  by  [Developer] 
 or  to  AT&  T's  conduit  if  they  wish  to  pull  through  their  own  fiber  cable."  64  While  we  are  encouraged  to  hear  that  the  Developer  is  installing  conduit  in  the  trenches,  65  we  do  not  have 
 enough  information  about  the  availability  of  conduit  to  conclude  that  it  makes  the  Agreement  functionally  non-  exclusive.  If  conduit  space  were  available  to  competitors  in  a  manner 
 consistent  with  section  253,  it  would  further  ameliorate  our  concerns  because  it  would  enable 
 61  TCG  Comments  at  12  (TCG  is  concerned  that  access  to  TCG  equipment  by  non-  TCG  personnel  could  void 
 equipment  warranties  and  threaten  the  "proprietary  and  confidential  nature  of  TCG's  network."  TCG  argues  that  it  is  more  efficient  for  it  to  manage  and  maintain  its  own  facilities.  Id.  at  14);  Nextlink  Comments  at  9. 

 62  Ameritech  Comments  at  3;  KMC  Comments  at  4;  see  MFS  Comments  at  11. 
 63  Minnesota  Reply  Comments  at  26-  27;  Minnesota,  Bhimani  Reply  Aff.  at    19. 
 64  Letter  from  Laura  Bishop,  Director  of  Legislative  Affairs,  Department  of  Administration,  to  Magalie 
 Roman  Salas,  Secretary,  Federal  Communications  Commission,  at  1  (Dec.  13,  1999)(  Minnesota,  Bishop  Dec.  13  ex  parte);  Letter  from  Gregory  P.  Huwe,  Assistant  Attorney  General,  State  of  Minnesota,  to  David  Kirschner,  Common 

 Carrier  Bureau,  Federal  Communications  Commission,  at  1  (Dec.  16,  1999)(  Minnesota,  Huwe  Dec.  16  ex  parte). 
 65  Minnesota,  Huwe  Dec.  16  ex  parte  at  1. 
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 competitors  to  pull  their  own  fiber  through  the  conduit  at  a  later  time.  66  The  current  record  however  neither  indicates  that  the  Developer  is  required  to  provide  conduit  nor  that  it  will  have 
 the  ability  to  provide  such  conduit  space.  67 
 30.  The  record  also  indicates  that  the  Developer  is  installing  conduit  on  behalf  of  AT&  T.  68  This  suggests  that  empty  conduit  space  may  be  available  from  AT&  T.  While  this 
 might  further  ameliorate  our  concerns,  the  record  does  not  provide  the  rates,  terms  and  conditions  AT&  T  would  offer  for  access  to  the  conduit  nor  whether  AT&  T  would  even  offer 
 access  to  such  conduit.  69  As  a  result,  we  cannot  determine,  at  this  time,  whether  the  availability  of  conduit  would  ameliorate  the  anticompetitive  concerns  that  may  have  been  created  by  the 
 Agreement. 
 d.  Nondiscrimination 
 31.  Minnesota  fails  to  demonstrate  that  the  Agreement's  nondiscrimination  provisions  are  sufficient  to  protect  collocators  and  entities  reselling  or  purchasing  Developer's  capacity.  70 
 As  commenters  note,  the  Agreement  specifically  states  that  it  does  not  create  third  party  rights.  71 
 66  This  is  similar  to  a  rights-  of-  way  policy  devised  by  the  City  of  Boston  that  maximizes  the  availability  of 
 conduit  and  minimizes  the  need  for  multiple  street  openings.  Letter  from  Merita  A.  Hopkins,  Corporation  Counsel,  City  of  Boston  Law  Department,  to  Magalie  Roman  Salas,  Secretary,  Federal  Communications  Commission, 

 Attachment  (Mar.  25,  1999). 
 67  Minnesota  indicates  "that  once  fiber  has  been  pulled  through  a  conduit,  it  is  unlikely  that  additional  fiber 
 will  be  installed  in  that  conduit,  due  to  the  potential  for  damage  to  existing  fiber  and  the  availability  of  other  upgrade  methods."  Minnesota,  Huwe  Dec.  16  ex  parte  at  2  (citing  Petition,  Bhimani  Aff.,  Ex.  8). 

 68  Minnesota,  Huwe  Dec.  16  ex  parte  at  1. 
 69  If  AT&  T  is  a  local  exchange  carrier,  it  has  the  "duty  to  afford  access  to  [its]  poles,  ducts,  conduits,  and 
 rights-  of-  way  of  such  carrier  to  competing  providers  of  telecommunications  services  on  rates,  terms,  and  condition  that  are  consistent  with  section  224."  47  U.  S.  C.    251(  b)(  4). 

 70  Section  7.7  of  the  Agreement  states  in  part:  "[  a]  t  all  times  the  [Developer]  shall  maintain,  offer,  accept, 
 implement  and  adhere  to  written,  uniform  and  non-  discriminatory  rates  and  charges  for  all  similarly  situated  customers  and  potential  customers  for  such  customer's  rights  to  use  or  access  the  Network  or  to  become  Collocating 

 Customers.  .  .  .  The  term  'similarly  situated  customers  and  potential  customers'  is  intended  to  permit  [Developer]  to  maintain,  offer,  accept,  implement  and  adhere  to  different  rates  and  charges  for  different  classifications  os 
 customers  (including  but  not  limited  to  Collocating  Customers)  based  on  commercially  reasonable  considerations  and  distinctions,  such  as  but  not  limited  to  volume  of  capacity  in  the  Network  utilized  or  the  volume  of  data 
 transported  by  a  particular  customer  or  the  length  of  time  for  which  any  particular  customer  commits  to  the  utilization  of  a  specified  volume  of  capacity  in  the  Network  or  a  specified  volume  of  data  transported."  Agreement, 
 Section  7.7. 
 71  US  West  Comments  at  14;  Nextlink  Comments  at  8;  KMC  Comments  at  9;  see  MTA  Reply  Comments  at 
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 As  a  result,  parties  wishing  to  obtain  facilities  or  service  from  Developer  or  collocate  along  the  freeway  rights-  of-  way  have  no  right  to  enforce  the  Agreement's  nondiscrimination 
 requirements.  72 
 32.  In  addition,  it  is  not  clear  from  the  record  whether  the  nondiscrimination  language  of  the  Agreement  provides  Minnesota  with  sufficient  oversight  powers  to  ensure  that  the  rates 
 will  be  fair  and  reasonable.  73  The  Agreement  allows  the  Developer  to  raise  prices  so  long  as  they  are  not  discriminatory.  74  Aside  from  claiming  that  the  charges  were  discriminatory,  neither 
 Minnesota  nor  Developer's  customers  would  have  a  basis  to  object  to  the  level  of  charges.  Thus,  Developer  could  use  its  exclusive  physical  access  to  the  freeway  rights-  of-  way  to  extract 
 monopoly  profits  from  the  fiber  capacity  it  leases  or  "sells"  on  an  IRU-  like  basis,  as  well  as  from  installation  and  maintenance  of  collocated  fiber.  75 

 33.  Moreover,  if  Developer  creates  an  affiliated  retail  service  provider,  it  could  effectively  preclude  third  parties  from  benefitting  from  the  less  expensive  rights-  of-  way  by 
 charging  all  retail  customers,  including  its  affiliate,  unduly  high  rates.  76  These  charges  would 
 6. 
 72  Section  20.5  of  the  Agreement  states:  "[  n]  othing  contained  in  this  Agreement  is  intended  or  shall  be 
 construed  as  creating  or  conferring  any  rights,  benefits  or  remedies  upon,  or  creating  any  obligations  of  the  parties  hereto  toward,  any  person  or  entity  not  a  party  to  this  Agreement,  except  rights  expressly  contained  herein  for  the 

 benefit  of  Lenders."  Agreement,  Section  20.5. 
 73  USTA  Joint  Comments  at  12,  16-  17;  MFS  Comments  at  27-  28;  see  TCG  Comments  at  16;  RCN  Comments 
 at  7,  10;  GVNW  Comments  at  8-  9. 
 74  Section  7.7  allows  Developer  to  "modify,  supplement  or  revise  its  rates  and  charges  for  use  of  or  access  to 
 the  Network,  so  long  as  such  rates  and  charges,  as  modified,  supplemented  or  revised,  continue  to  provide  uniform  and  nondiscriminatory  rates  and  charges  for  use  of  or  access  to  the  Network  or  for  collocating  fiber  optic  cable  for 

 similarly  situated  customers  and  potential  customers."  Agreement,  Section  7.7. 
 75  We  note  that  New  York  has  addressed  this  issue.  In  parts  of  New  York,  Empire  City  Subway  Company, 
 Limited,  a  wholly-  owned  subsidiary  of  Bell  Atlantic,  has  been  granted  a  non-  exclusive  right  to  construct,  operate  and  maintain  a  system  of  underground  conduits.  Empire  then  leases  space  in  its  conduits,  the  pricing  of  which  is 

 subject  to  the  "control,  modification  and  revision"  of  New  York  City.  Empire's  "rates  are  determined  by  rate  case  proceedings  held  before  the  City  of  New  York  Department  of  General  Services."  Letter  from  Dee  May,  Director, 
 Federal  Regulatory  Affairs,  Bell  Atlantic,  to  Magalie  Roman  Salas,  Secretary,  Federal  Communications  Commission,  (March  22,  1999),  Att.  1,  Yildirim  S.  Guner  Affidavit  at    3-  8;  see  GVNW  Comments  at  9. 

 76  Agreement,  Section  7.  8.  Section  7.  8  of  the  Agreement  allows  Developer  to  have  an  "affiliated"  company 
 but  requires  the  Developer  to  charge  such  entity  "the  same  rates  and  charges  as  it  does  for  similarly  situated,  unaffiliated,  non-  interested  customers  and  users  of  the  Network  or  similarly  situated,  unaffiliated  non-  interested 

 Collocating  Customers."  Agreement,  Section  7.8(  c).  See  SBC  Comments  at  6;  Nextlink  Comments  at  8;  see  also  MFS  Comments  at  26.  Developer  claims  that  it  does  not  have  any  affiliated  or  subsidiary  companies.  Universal 
 Communication  Networks  Reply  Comments  at  2. 
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 not  be  discriminatory  since  they  would  apply  to  all  retail  customers,  however.  While  this  would  reduce  the  profits  of  its  retail  affiliate,  Developer  could  offset  this  by  the  increased  profits  on  its 
 wholesale  offering.  In  contrast  to  this,  competitors  would  simply  have  lower  retail  profits  if  they  used  Developer's  services  and  facilities.  In  this  way,  Developer  could  retain  the  benefits  of  the 
 less  expensive  rights-  of-  way  for  itself  and  prevent  competitors  from  benefitting  from  use  of  the  least  expensive  rights-  of-  way.  Again,  the  uncertainty  over  how  the  Developer  will  implement 
 the  Agreement  requires  us  to  exercise  caution  at  this  point  and  not  approve  the  Agreement  as  consistent  with  section  253. 

 34.  We  conclude  that  Minnesota  fails  to  demonstrate  that  the  Agreement's  nondiscrimination  provisions  are  sufficient  to  protect  resellers  and  collocators.  Neither  third 
 parties  nor  the  State  would  be  able  to  ensure  that  the  Developer  does  not  capitalize  on  the  monopoly  powers  granted  it  by  the  state.  It  is  possible  that  the  Developer's  charges  and/  or  other 
 terms  for  the  purchase  of  capacity  will  be  reasonable,  but,  based  on  the  present  record,  we  cannot  determine  whether  this  will  be  the  case. 

 D.  Section  253(  b)  Analysis 
 35.  We  conclude  that  the  Agreement  is  not  protected  by  section  253(  b),  which  preserves  from  preemption  certain  state  or  local  requirements  that  are  "competitively  neutral," 
 and  "necessary"  to  achieve  the  public  interest  objectives  enumerated  in  section  253(  b),  even  if  the  requirements  contravene  section  253(  a).  77  In  particular,  Minnesota  has  not  convinced  us  that 
 the  Agreement  is  competitively  neutral.  We  also  note  that  Minnesota  has  not  shown  that  the  restrictions  on  physical  access  to  the  freeway  rights-  of-  way  are  necessary  to  protect  the  public 
 safety  and  welfare. 
 1.  Competitive  Neutrality  of  the  Agreement 
 36.  We  cannot  agree  with  the  State's  contention  that  the  Agreement  is  competitively  neutral  as  required  by  section  253(  b)  because  the  State  followed  a  public  procurement  process  in 
 selecting  the  Developer.  78  In  support  of  its  position,  Minnesota  argues  that  the  requirement  for 
 77  Texas  Preemption  Order,  13  FCC  Rcd  at  3480,    41-  42;  see  Silver  Star  Telephone  Company  Petition  for 
 Preemption  and  Declaratory  Ruling,  Memorandum  Opinion  and  Order  at    37  (1997)  (Silver  Star  Preemption  Order).  Since  Minnesota  asserts  that  the  Agreement  falls  within  the  exception  to  preemption  created  by  section 

 253(  b),  it  bears  the  burden  of  demonstrating  that  the  Agreement  falls  within  the  parameters  of  section  253(  b). 
 78  Petition  at  28-  30;  ICS/  UNC,  L.  L.  C.  Reply  Comments  at  7;  USDOT  Reply  Comments  at  7-  8;  but  see  GTE 
 Comments  at  10;  Time  Warner  Reply  Comments  at  10-  11.  The  State  issued  a  Request  for  Proposals  (RFP).  The  RFP  listing  criteria  for  proposals  was  published  in  the  State  Register  and,  the  State  awarded  the  right  to  negotiate 

 the  contract  to  the  party  filing  the  most  advantageous  proposal.  The  RFP  was  open  to  all  qualified  parties.  Petition  at  31;  see  also  ICS  Reply  Comments  at  7-  8.  Minnesota  notes  that  several  of  the  commenters  who  oppose 
 Minnesota's  Petition  submitted  proposals  in  response  to  the  RFP.  Minnesota  Reply  Comments  at  43. 
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 competitive  neutrality  in  section  253(  b)  only  relates  to  how  the  requirement  is  imposed,  not  to  the  substantive  effect  of  the  measure.  We  do  not  believe  that  Congress  intended  to  protect  the 
 imposition  of  requirements  that  are  not  competitively  neutral  in  their  effect  on  the  theory  that  the  non-  neutral  requirement  was  somehow  imposed  in  a  neutral  manner.  Moreover,  we  do  not 
 believe  that  this  narrow  interpretation  is  appropriate  because  it  would  undermine  the  primary  purpose  of  section  253  --  ensuring  that  no  state  or  locality  can  erect  legal  barriers  to  entry  that 
 would  frustrate  the  1996  Act's  explicit  goal  of  opening  all  telecommunications  markets  to  competition.  79  Therefore,  we  conclude  that  the  proper  inquiry  is  whether  the  effect  of  the 
 Agreement  will  be  competitively  neutral.  80 
 37.  We  conclude  that  the  Agreement  is  not  competitively  neutral  because  it  grants  a  single  entity,  the  Developer,  exclusive  physical  access  to  the  valuable  freeway  rights-  of-  way  for 
 a  period  of  ten  years  with  an  option  to  renew  for  another  ten  years.  81  This  restriction  on  physical  access  is  likely,  as  we  explained  above,  to  disadvantage  future  facilities-  based  entrants.  In 
 reaching  this  conclusion,  we  recognize  that  it  is  not  necessary  for  a  state  to  treat  all  entities  in  the  same  way  for  a  requirement  to  be  competitively  neutral.  In  fact,  treating  differently  situated 
 entities  the  same  can  contravene  the  requirement  for  competitive  neutrality.  In  this  case,  however,  Minnesota  has  not  demonstrated  that  there  are  differences  in  circumstances  that 
 warrant  granting  exclusive  physical  access  to  the  freeway  rights-  of-  way  to  only  one  party. 
 38.  Our  conclusion  in  this  regard  is  supported  by  the  decision  in  the  Texas  Preemption  Order.  In  that  Order  we  found  that  certain  facilities  "build  out"  requirements  were 
 not  competitively  neutral  under  section  253(  b)  because  they  "single[  d]  out  [a  specific  class  of  carriers]  and  require[  d]  them  to  construct  their  own  facilities  or  purchase  access  to  non-incumbent 
 network  elements."  82  We  also  noted  that  "by  imposing  the  costs  of  providing  facilities  based  service  only  on  [certain  carriers],  the  build-  out  provisions  significantly  affect[  ed] 
 the  ability  of  [these  carriers]  to  compete  against  other  certificated  carriers  for  customers  in  the 

 79  Texas  Preemption  Order,  13  FCC  Rcd  at  3480,    41. 
 80  In  the  Huntington  Park  Preemption  Order,  we  were  not  concerned  with  how  Huntington  Park  chose 
 Pacific  Bell  as  the  provider,  we  were  concerned  with  the  effect  of  the  contract  on  competition.  California  Payphone  Association  Petition  for  Preemption  of  Ordinance  No.  576  NS  of  the  City  of  Huntington  Park,  California  Pursuant 

 to  Section  253(  d)  of  the  Communications  Act  of  1934,  Memorandum  Opinion  and  Order,  12  FCC  Rcd  14191,  14206-  07,    32-  34  (1997)  (Huntington  Park  Preemption  Order). 

 81  See  US  West  Comments  at  18-  19;  Nextlink  Comments  at  10  (noting  that  Developer  and  collocators  will 
 have  an  advantage  over  other  telecommunications  providers);  NTCA  Comments  at  5  (noting  that  Developer  benefits  by  providing  Minnesota  with  service,  precluding  other  carriers  from  providing  service  to  the  State);  MFS  Comments 

 at  23. 
 82  Texas  Preemption  Order,  13  FCC  Rcd  at  3500,    82. 
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 local  exchange  market."  83  Here  the  Agreement  forces  a  specific  class  of  carriers  to  use  alternative  rights-  of-  way  that  appear  to  be  more  costly  than  the  freeway  rights-  of-  way.  The  only 
 significant  difference  is  that  the  lack  of  competitive  neutrality  in  this  case  is  imposed  by  granting  the  Developer  an  advantage  --  exclusive  physical  access  to  the  freeway  rights-  of-  way  --  rather 
 than  imposing  a  disadvantage  on  a  certain  class  of  carriers,  as  was  the  case  in  the  Texas  Preemption  Order.  Furthermore,  as  discussed  above,  Minnesota  has  not  demonstrated  that  the 
 nondiscrimination  provisions  of  the  Agreement  are  sufficient  to  overcome  the  effect  of  granting  one  entity  exclusive  physical  access  to  the  freeway  rights-  of-  way  and  render  the  Agreement 
 competitively  neutral.  84 
 2.  Necessity  of  the  Agreement 
 39.  Our  conclusion  that  the  Agreement  is  not  competitively  neutral  is  dispositive  on  the  question  of  whether  the  section  253(  b)  exemption  applies.  We  nonetheless  take  this 
 opportunity  to  raise  concerns  about  Minnesota's  claims  that  the  Agreement  is  necessary  to  protect  public  safety  and  advance  universal  service  objectives. 

 a.  Public  Safety 
 40.  We  agree  with  the  State's  assertion  that  requirements  protecting  the  traveling  public  and  transportation  workers  fall  within  the  general  class  of  requirements  potentially 
 protected  by  section  253(  b).  Minnesota  is  concerned  that  allowing  construction  on  the  freeway  rights-  of-  way  will  increase  the  number  of  accidents  and  fatalities  on  the  freeway,  and,  as 
 discussed  above,  that  allowing  construction  more  than  once  every  ten  years  will  increase  the  risk  to  an  unacceptable  level.  85  In  this  instance,  however,  opponents  of  the  Agreement  dispute 
 certain  aspects  of  Minnesota's  claims.  86 
 83  Id. 

 84  See  supra  Section  II,  C,  4,  d. 
 85  Petition  at  27;  Minnesota,  Lari  Aff.  at    8;  Minnesota  Reply  Comments  at  36,  40;  Durgin  Reply  Aff.  at   
 20;  USDOT  May  21  ex  parte  at  4-  5  (Noting  that  the  ongoing  debate  about  whether  to  allow  access  to  these  rights-of-  way  was  "not  because  of  doubts  about  the  ability  of  modern  communications  technology  to  serve  the  public 

 interest,  but  because  of  the  millions  of  accidents  that  occur  on  the  nation's  highway  each  year,  and  the  established  fact  that  the  presence  of  construction  vehicles  and  personnel  on  the  rights-  of-  way  of  these  roads  unfortunately 
 results  in  additional  accidents,  injuries,  and  deaths.");  see  also  Crown  Castle  Reply  Comments  at  3.  It  is  USDOT's  view  that  requiring  relatively  frequent  reopening  of  telecommunications  trenches  "would  be  unpalatable  to  most 
 states,  which  could  retain  or  revert  to  prior  policies  forbidding  access  altogether  to  affected  rights-  of-  way."  USDOT  May  21  ex  parte  at  5;  but  see  MTA,  Cosson  July  22  ex  parte  at  7  (arguing  that  USDOT  has  safety  reviewed  state 
 policies  allowing  multiple  installations  of  fiber  facilities). 
 86  Although  we  accord  substantial  deference  to  a  state's  expert  agency  when  considering  issues  of  highway 
 safety,  certain  aspects  of  the  state's  claims  are  in  dispute. 
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 41.  The  record  indicates  that  in  many  rural  areas,  the  freeway  right-  of-  way  extends  a  considerable  distance  beyond  the  paved  shoulder,  permitting  work  to  take  place  beyond  the 
 paved  shoulder.  87  A  major  highway  study  in  the  record  also  shows  "that  construction  on  either  the  'Shoulder/  Roadside'  (i.  e.,  on  the  shoulder  or  beyond  the  shoulder)  did  not  increase  accident 
 rates  in  on  (sic)  any  road  type."  88  According  to  this  study,  "[  t]  he  impact  of  construction  on  shoulders  or  roadsides  was  a  4.3%  decrease  [in  accident  rates]  with  rural  freeways,  [and]  a  2.2% 
 decrease  [in  accident  rates]  with  urban  freeways,"  when  compared  with  "normal"  road  conditions.  89  As  such,  in  areas  with  wide  rights-  of-  way,  the  record  does  not  show  a  correlation 
 between  construction  work  off  the  highway  shoulder  and  an  increase  in  accidents.  Because  the  Agreement  requires  construction  away  from  the  paved  surfaces  when  rights-  of-  way  are  wide 
 enough,  Minnesota's  safety  concerns  appear  to  be  overstated,  except  in  areas  with  very  narrow  rights-  of-  way.  90 

 42.  Moreover,  it  appears  that  installing  fiber  optic  facilities  has  no  greater  safety  impact  than  typical  roadside  maintenance,  such  as  removal  of  refuse,  mowing  of  grass,  sign 
 maintenance  and  replacement,  fence  repair,  and/  or  culvert  construction  that  occurs  routinely.  In  fact,  installing  fiber  is  less  intrusive  than  typical  repairs  which  take  place  on  the  roadways  such 
 as  joint  repair  and  patching,  or  snow  removal,  which  are  common  in  cold  climates  like 
 87  Letter  from  David  Cosson,  Kraskin,  Lesse  &  Cosson,  LLP,  to  Magalie  Roman  Salas,  Secretary,  Federal 
 Communications  Commission,  and  Carol  E.  Mattey,  Chief,  Policy  and  Program  Planning  Division,  Federal  Communications  Commission  (Dec.  22,  1998),  Arnold  R.  Kraft  Affidavit  at    9  (MTA,  Kraft  ex  parte  Aff.);  RCN 

 Comments  at  11-  12;  ALTS  Comments  at  17;  MTA,  Cosson  July  22  ex  parte  at  6,  8;  but  see  USDOT  May  21  ex  parte  at  3  (Less  than  fifty  percent  of  the  2,000  miles  covered  by  the  Agreement  has  a  right-  of-  way  so  wide  that 
 construction  equipment  and  crews  can  avoid  working  in  the  shoulder  area,  i.  e.,  "on  more  than  1,000  miles  of  Minnesota's  roadways  over  the  next  one  to  two  years,  telecommunications-  related  work  in  the  ROW  will  introduce 
 a  non-  trivial  safety  risk  to  motorists  and  work  crews);  Minnesota,  Ahlers  June  16  ex  parte  at  4  (Claiming  that  the  width  of  the  rights-  of-  way  varies);  Minnesota,  Ahlers  Sept.  14  ex  parte  at  4. 

 88  MTA,  Kraft  ex  parte  Aff.  at    10  (emphasis  added),  Att.  1,  National  Cooperative  Highway  Research 
 Program,  Procedures  for  Determining  Work  Zone  Speed  Limits,  Research  Results  Digest,  Sept.  1996,  at  Table  10  (NCHRP  safety  study).  Minnesota  references  the  same  study  cited  by  the  MTA,  but  cites  the  data  for  construction 

 on  the  paved  roadway  and  the  paved  shoulder.  The  MTA  points  to  the  data  for  work  off  of  the  paved  roadway  and  beyond  the  paved  shoulder. 

 89  MTA,  Kraft  ex  parte  Aff.  at    9  (emphasis  added);  see  NCHRP  safety  study,  Table  10. 
 90  ALTS  Comments  at  17;  MFS,  Eide  Decl.  at    8  (According  to  MFS  declarant:  "[  t]  he  customary  practice  of 
 placing  fiber  optic  cable  away  from  the  surface  of  the  roadway,  and  the  extremely  low  level  of  maintenance  for  fiber,  minimizes  safety  considerations.");  Ameritech  Comments  at  3-  4  ("  The  sole  justification  Minnesota  offers  for 

 limiting  the  use  of  the  freeways  to  a  single  entity  is  the  historic  prohibition  on  use  for  these  purposes  coupled  with  a  naked  assertion  that  access  must  be  limited  to  a  single  party  in  order  to  address  concerns  regarding  the  safety  of  the 
 traveling  public  and  the  adverse  consequences  of  congestion.") 
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 Minnesota.  91  Therefore,  based  on  the  record  before  us,  we  are  unable  to  determine  whether  it  is  necessary  to  limit  installation  of  fiber  to  once  every  ten  years  on  all  parts  of  Minnesota's 
 interstate  freeway  system. 
 b.  Universal  Service 
 43.  While  we  applaud  Minnesota's  efforts  to  bring  advanced  services  to  rural  areas,  we  are  concerned  that  the  Agreement  is  not  "necessary  to  preserve  and  advance  universal 
 service."  92  Minnesota  claims  that  one  of  the  benefits  of  the  Agreement  is  that  it  extends  fiber  optic  capacity  into  rural  areas  by  requiring  Developer  to  install  fiber  over  the  entire  planned 
 network.  93  As  discussed  above,  however,  extracting  benefits  from  the  Developer  in  exchange  for  exclusive  physical  access  to  rights-  of-  way  is,  we  believe,  fundamentally  inconsistent  with  the 
 1996  Act.  94  At  the  very  least,  Minnesota  has  not  demonstrated  that  this  method  is  necessary  to  deploy  advanced  services. 

 E.  Section  253(  c) 
 44.  We  cannot  agree  with  Minnesota  that  the  Agreement  is  protected  from  preemption  by  section  253(  c).  Section  253(  c)  provides  that  "[  n]  othing  in  this  section  affects  the 
 authority  of  a  State  or  local  government  to  manage  the  public  rights-  of-  way  or  to  require  fair  and  reasonable  compensation  from  telecommunications  providers,  on  a  competitively  neutral  and 
 nondiscriminatory  basis,  for  use  of  public  rights-  of-  way  on  a  nondiscriminatory  basis,  if  the  compensation  required  is  publicly  disclosed  by  such  government."  95  Minnesota  contends  that 
 the  decision  to  grant  exclusive  physical  access  to  Developer  constitutes  rights-  of-  way  management  that  Congress  exempted  from  section  253  preemption.  Further,  Minnesota  claims 
 that  it  is  managing  the  rights-  of-  way  in  a  nondiscriminatory  manner  because  Developer  is  a  not  a  telecommunications  service  provider.  96  Minnesota  also  asserts  that  the  compensation  required  is 
 reasonable,  competitively  neutral  and  nondiscriminatory  as  required  by  section  253(  c).  In  particular,  it  asserts  that  the  open  procurement  process  ensures  that  the  state  has  not  unfairly 
 favored  one  provider  over  another.  The  state  also  argues  that  the  nondiscrimination 
 91  MTA,  Kraft  ex  parte  Aff.  at    13,  Att.  2,  National  Cooperative  Highway  Research  Program,  Longitudinal 
 Occupancy  of  a  Controlled  Access  Right-  of-  Way  by  Utilities,  National  Research  Council  (1996). 
 92  47  U.  S.  C.  253(  b). 

 93  Universal  Communication  Networks  Reply  Comments  at  2,  5;  Minnesota,  Ahlers  June  16  ex  parte  at  5. 
 94  See  supra  paras.  0-  0. 
 95  47  U.  S.  C.    253(  c). 
 96  Minnesota,  Ahlers  June  16  ex  parte  at  4. 
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 requirements  in  the  Agreement  and  the  provisions  for  collocation  of  third  party  fiber  mitigate  any  anti-  competitive  effects  of  the  Agreement.  97 
 45.  We  have  serious  reservations  about  whether  the  Agreement  constitutes  rights-  of-way  management  for  purposes  of  section  253(  c).  In  particular,  the  legislative  history  of  section 
 253(  c)  indicates  that  Congress  intended  to  protect  the  states'  traditional  regulation  of  rights-  of-way.  98  The  House  Report  states  that  section  253  "makes  explicit  a  local  government's  continuing 
 authority  to  issue  construction  permits  regulating  how  and  when  construction  is  conducted  on  roads  and  other  public  rights-  of-  way."  99  In  contrast  to  this,  Minnesota  has  decided  not  to  use  a 
 permit  process  similar  to  that  in  effect  for  other  state  rights-  of-  way  and  instead  has  granted  exclusive  physical  access  to  this  right-  of-  way  to  a  single  entity  in  return  for  valuable 
 consideration. 
 46.  Even  assuming  that  the  Agreement  constitutes  rights-  of-  way  management,  Minnesota  has  not  demonstrated  that  the  Agreement  is  protected  by  section  253(  c).  Section  253 
 requires  that  both  management  of  public  rights-  of-  way  and  the  requirement  for  compensation  be  competitively  neutral  and  nondiscriminatory  in  order  for  a  state  or  local  legal  requirement  to  be 
 protected  under  section  253(  c).  100  As  discussed  previously  in  relation  to  section  253(  b),  Minnesota  has  not  shown  that  the  Agreement  is  "competitively  neutral  and 

 97  Petition  at  29-  32. 
 98  TCI  Cablevision  of  Oakland  County,  Inc.  Petition  for  Declaratory  Ruling,  Preemption  and  Other  Relief 
 Pursuant  to  47  U.  S.  C.    541,  544(  e),  and  253,  Memorandum  Opinion  and  Order,  12  FCC  Rcd  21396,  21441;  Classic  Preemption  Order,  11  FCC  Rcd  at  13103,    39-  40;  see  also  USTA  Joint  Comments  at  12;  RCN  Comments 

 at  4-  5;  Midwest  Wireless  Comments  at  6;  GTE  Comments  at  11;  MFS  Comments  at  35.  In  the  Classic  Preemption  Orders,  the  Commission  found  that  the  types  of  activities  that  fall  within  the  sphere  of  appropriate  rights-  of-  way 
 management  include  coordination  of  construction  schedules,  determination  of  insurance,  bonding,  and  indemnity  requirements,  establishment  and  enforcement  of  building  codes  and  keeping  track  of  the  various  systems  using  the 
 rights-  of-  way  to  prevent  interference  between  them.  Classic  Telephone,  Inc.,  Petition  for  Emergency  Relief,  Sanctions  and  Investigation,  Memorandum  Opinion  and  Order,  12  FCC  Rcd  15619,  at  15637,  n.  102  (citing  Classic 
 Preemption  Order,  11  FCC  Rcd  at  13103,    39);  see  GVNW  at  5;  see  also  ALTS  Comments  at  13,  n.  15,  18;  MFS  Comments  at  36;  Time  Warner  Reply  Comments  at  12;  but  see  USDOT  Reply  Comments  at  6-  7  (Arguing  that  the 
 Agreement  is  a  "reasonable  exercise  of  its  management  authority  over  public  rights-  of-  way"). 
 99  House  Report  No.  104-  204,  U.  S.  Congressional  &  Administrative  News,  March  1996,  vol.  1,  Legislative 
 History  section  at  41(  emphasis  added). 
 100  Classic  Preemption  Order,  11  FCC  Rcd  13082,  13103,    39;  Cablevision  of  Boston,  Inc.,  v.  Public 
 Improvement  Commission  of  the  City  of  Boston,  No.  99-  1222,  1999  WL  632203,  at  *11-  13  (1st  Cir.  Aug  25,  1999)(  finding  that  the  "larger  context  suggests  that  [Congress]  would  have  wanted  to  impose  [the  competitively 

 neutral  and  nondiscriminatory]  requirement  on  both  management  of  rights  of  way  and  compensation  schemes"  despite  the  fact  that  syntactically  and  semantically  "competitively  neutral"  only  applies  to  compensation  schemes 
 and  not  management  of  rights  of  way.) 
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 nondiscriminatory."  101  Therefore,  even  assuming  that  the  Agreement  constitutes  protected  rights-  of-  way  management  --  which  we  are  not  convinced,  based  on  this  record,  that  it  does  -- 
 Minnesota  has  not  shown  that  such  management  is  competitively  neutral  and/  or  nondiscriminatory. 

 47.  Moreover,  Minnesota  has  not  shown  that  the  compensation  required  for  access  to  the  right-  of-  way  is  "fair  and  reasonable."  102  The  compensation  appears  to  reflect  the  value  of  the 
 exclusivity  inherent  in  the  Agreement,  rather  than  fair  and  reasonable  charges  for  access  to  the  right-  of-  way.  Nor  has  Minnesota  shown  that  the  Agreement  provides  for  "use  of  public  rights-of- 
 way  on  a  nondiscriminatory  basis."  103 
 48.  In  addressing  the  status  of  the  Agreement  under  section  253,  we  are  responding  to  Minnesota's  request  for  a  declaratory  ruling  on  the  Agreement.  Since  we  conclude  that 
 Minnesota  fails  to  demonstrate  that  the  Agreement  will  not  violate  section  253(  a)  or  that  it  is  protected  by  section  253(  b),  we  must  consider  whether  the  Agreement  is  protected  from 
 preemption  by  section  253(  c)  in  order  to  fully  respond  to  Minnesota's  petition.  Our  discussion  of  these  issues  should  not  be  interpreted  as  addressing  potential  issues  involving  the  Commission's 
 jurisdiction  under  section  253(  c). 
 III.  PETITIONS  FOR  PREEMPTION 
 49.  Many  of  the  parties  opposing  Minnesota's  request  for  declaratory  ruling  also  ask  the  Commission  to  preempt  the  Agreement  in  their  filings  in  this  proceeding.  We  do  not  resolve 
 these  requests  for  preemption  at  the  present  time.  As  our  prior  discussion  makes  clear,  there  are  aspects  of  the  Agreement  that  have  the  potential  to  contravene  section  253(  a),  and  we  invite 
 interested  parties  to  comment  on  whether  the  Commission  should  preempt  the  Agreement  pursuant  to  its  authority  under  section  253(  d).  We  believe  that  our  consideration  of  any  requests 
 for  preemption  would  be  aided  by  supplemental  information  concerning  the  practical  effect  of  this  Agreement,  and  we  urge  parties  to  provide  us  with  such  information  in  their  comments. 

 101  47  U.  S.  C.    253(  c);  see  supra  Section  II,  D,  1. 
 102  47  U.  S.  C.    253(  c). 
 103  Id. 
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 IV.  ORDERING  CLAUSE 
 50.  Accordingly,  IT  IS  ORDERED  that  the  Petition  for  Declaratory  Ruling  filed  by  the  State  of  Minnesota  IS  DENIED. 

 FEDERAL  COMMUNICATIONS  COMMISSION 

 Magalie  Roman  Salas  Secretary 
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 APPENDIX  A 
 Minnesota  Petition  for  Declaratory  Ruling  CC  Docket  No.  98-  1 
 List  of  Commenters 
 Comments 
 Ameritech  Corporation  (Ameritech)  Association  for  Local  Telecommunications  Services  (ALTS) 
 GTE  Service  Corporation  (GTE)  GVNW,  Inc.  (GVNW) 
 KMC  Telecom  Inc.  and  KMC  Telecom  II,  Inc.  (KMC)  MCI  Telecommunications  Corporation  (MCI) 
 MFS  Network  Technologies,  Inc.  (MFS)  Midwest  Wireless  Communications,  L.  L.  C.  (Midwest  Wireless) 
 Minnesota  Telephone  Association  (MTA)  National  Cable  Television  Association  (NCTA) 
 National  Telephone  Cooperative  Association  (NTCA)  New  York  State  Telecommunications  Association,  Inc.  (NYSTA) 
 Nextlink  Communications  Inc.  (Nextlink)  RCN  Telecom  Services,  Inc.  (RCN) 
 SBC  Communications  Inc.  (SBC)  Teleport  Communications  Group  Inc.  (TCG) 
 United  States  Telephone  Association,  The  Organization  for  the  Promotion  and  Advancement  of  Small  Telecommunications  Companies,  The  Western  Rural  Telephone  Association 
 and  The  Competition  Policy  Institute  (USTA  Joint  Comments)  US  West,  Inc.  (US  West) 

 Reply  Comments 
 Crown  Castle  International  Corp.  (Crown  Castle  Reply  Comments)  ICS/  UNC,  L.  L.  C.  (Developer  Reply  Comments) 
 Intelligent  Transportation  Society  of  America  (ITS  America  Reply  Comments)  MCI  Telecommunications  Corporation  (MCI  Reply  Comments) 
 MFS  Network  Technologies,  Inc.  (MFS  Reply  Comments)  Minnesota  Telephone  Association  (MTA  Reply  Comments) 
 Teleport  Communications  Group  Inc.  (TCG  Reply  Comments)  Time  Warner  Cable  (Time  Warner  Reply  Comments) 
 United  States  Telephone  Association,  The  Organization  for  the  Promotion  and  Advancement  of  Small  Telecommunications  Companies,  The  Western  Rural  Telephone  Association 
 and  the  Competition  Policy  Institute  (USTA  Joint  Reply  Comments)  Universal  Communication  Networks,  LLC 
 U.  S.  Department  of  Transportation  (US  DOT  Reply  Comments)  US  West,  Inc.  (US  West  Reply  Comments) 
 Wilbur  Smith  Associates 
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 States,  State  Agencies,  and  other  Commenters 
 Alabama  Department  of  Transportation  American  Association  of  State  and  Highway  Transportation  Officials  (AASHTO) 
 Arizona  Department  of  Transportation  City  of  Boston 
 Commonwealth  of  Kentucky  Transportation  Cabinet  Commonwealth  of  Virginia,  Department  of  Transportation 
 DPD  Comprehensive  Resources  Planning  Indiana  Department  of  Transportation 
 Iowa  Department  of  Transportation  Kansas  Department  of  Transportation 
 Kentucky  Department  of  Transportation  Massachusetts  Highway  Department 
 Mississippi  Department  of  Transportation  Missouri  Department  of  Transportation 
 Montana  Department  of  Transportation  New  Mexico  State  Highway  and  Transportation  Department 
 New  York  State  Thruway  Authority  North  Dakota  Department  of  Transportation 
 Rep.  Phyllis  Kahn,  Rep.  Jean  Wagenius,  and  Rep.  Irv  Anderson,  Minnesota  House  of  Representatives 
 State  of  Alaska  Department  of  Transportation  and  Public  Facilities  State  of  California  Department  of  Transportation 
 State  of  Delaware  Department  of  Transportation  State  of  Florida  Department  of  Transportation 
 State  of  Idaho  Transportation  Department  State  of  Maine  Department  of  Transportation 
 State  of  Minnesota  Intergovernmental  Information  Systems  Advisory  Council  State  of  Montana  Department  of  Administration 
 State  of  Nebraska,  Department  of  Roads  State  of  New  Jersey  Department  of  Transportation 
 State  of  North  Carolina  Department  of  Transportation  State  of  Oregon  Department  of  Transportation 
 State  of  Rhode  Island  and  Providence  Plantations,  Department  of  Transportation  State  of  Tennessee  Department  of  Transportation 
 State  of  Utah  Department  of  Transportation  State  of  Vermont  Agency  of  Transportation 
 State  of  Wisconsin  Department  of  Transportation  Texas  Department  of  Transportation 
 Washington  State  Department  of  Transportation 
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