2023 Tennessee Code › Title 7 - CONSOLIDATED GOVERNMENTS AND LOCAL GOVERNMENTAL FUNCTIONS AND ENTITIES (§§ 7-1-101 — 7-91-104) › LOCAL GOVERNMENT FUNCTIONS (§§ 7-51-201 — 7-69-116) › Chapter 59 - CABLE TELEVISION (§§ 7-59-101 — 7-59-318) › Part 3 - COMPETITIVE CABLE AND VIDEO SERVICES ACT (§§ 7-59-301 — 7-59-318) › Section 7-59-305 - State-issued certificate of franchise authority - Application and fees

(a)
To receive a state-issued certificate of franchise authority, a cable or video service provider shall file an application with the department. A copy of the application shall be provided simultaneously to the governing authority of any affected municipality or county for services provided in unincorporated areas within a county. A parent company may file a single application covering itself and all, or some, of its subsidiaries and affiliates intending to provide cable or video service in the service areas throughout the state as described in subsection (c). The parent company shall include the names of the subsidiaries and affiliates and the service areas each intends to serve on its application to the department. The subsidiary or affiliate actually providing the service in the defined service area shall otherwise be considered the holder of the state-issued certificate of franchise authority under this part.
(b)
The department shall impose a fee in accordance with the following schedule:
(1)
With respect to applications for a state-issued certificate of franchise authority, the fee shall be based on the population of the service area or areas applied for in accordance with the most recent decennial census as follows:
(A)
Up to and including 50,000 - $500;
(B)
Over 50,000, up to and including 100,000 - $1,000;
(C)
Over 100,000, up to and including 500,000 - $2,000;
(D)
Over 500,000, up to and including 1,000,000 - $5,000;
(E)
Over 1,000,000, up to and including 2,000,000 - $10,000;
(F)
Over 2,000,000 - $15,000.
(2)
With respect to amendments, the fee shall be based upon the populations of the service area or areas in accordance with the most recent decennial census as follows:
(A)
Up to and including 50,000 - $250;
(B)
Over 50,000, up to and including 1,000,000 - $500;
(C)
Over 1,000,000 - $1,000.
(c)
The application for a state-issued certificate of franchise authority shall consist of an affidavit signed by an officer or partner. No other application form or materials shall be required. The affidavit shall provide the following information and affirm:
(1)
That the applicant agrees to comply with all applicable federal and state laws and regulations to the extent that the state laws and regulations are not in conflict with or superseded by this part or other applicable law and will timely file with the FCC all forms required by the FCC in advance of offering video services or cable services;
(2)
A written description of the municipalities and unincorporated areas within counties to be served, in whole or in part, by the applicant, which description shall be sufficiently detailed so as to allow a local government to respond to subscriber inquiries, including the name of each municipality or county governing authority within the service area. For purposes of this subdivision (c)(2), an applicant may, as a supplement to a written description, provide a map on eight and one half inch by eleven inch (81/2" by 11") paper that is clear and legible and that fairly depicts the service area by making reference to the municipal or county governing authority to be served. If the geographical area is less than an entire municipality or county, a map shall describe the boundaries of the geographic area to be served in clear and concise terms;
(3)
That the applicant/service provider intends to begin to offer video service or cable service for purchase or provide new broadband Internet service in accordance with §
7-59-311(d)
in each of the municipalities and the unincorporated areas of each county described in subdivision (c)(2) within twenty-four (24) months of the date of the issuance of a state-issued certificate of franchise authority. If the holder of a state-issued certificate of franchise authority fails to begin to offer the services within twenty-four (24) months in any such municipality or unincorporated area of a county, the certificate shall become null and void with regard to the municipality or unincorporated area of a county; provided, however, that the holder of a state-issued certificate of franchise authority shall provide the department with an explanation of the reason for the delay and whether or not it intends to subsequently amend its certificate to reinclude such areas. A holder of a state-issued certificate of franchise authority may seek a waiver of the time period within which service must be offered as set forth in §
7-59-311(e)
;
(4)
That the applicant agrees to indemnify and hold harmless, in accordance with §
7-59-318
, the state, municipality, county and any employee or representative of the state, municipality or county, as well as any political subdivision of the state and any employee or representative of the political subdivision, individually and collectively, referred to in §
7-59-318
as the indemnitee;
(5)
The location and telephone number of the principal place of business, the names of the principal executive officers of the applicant and the names of any persons authorized to represent the applicant before the department;
(6)
That the applicant has the managerial, financial and technical qualifications to provide cable or video service;
(7)
A description of the applicant's customer service complaint handling process, including policies on addressing customer service issues, billing adjustments and communication with government officials regarding customer complaints, and a local or toll-free telephone number at which a customer may contact the applicant. An applicant may satisfy this requirement by including the terms and conditions relating to customer complaints applicable to its customers, and the department shall conduct no review of the complaint handling process;
(8)
That notice has been provided to the affected local governing authority of its right to receive a franchise fee consistent with this part. Notice will be provided to other entities with facilities in the rights-of-way, consistent with any nondiscriminatory and generally applicable local ordinance or resolution requiring the notice prior to performing any installation in the right-of-way;
(9)
The applicant agrees to comply with the requirements of this part, expressly including the applicable nondiscrimination and service deployment requirements of §
7-59-311
, and further, that the applicant acknowledges the provisions of §
7-59-312
relative to enforcement of nondiscrimination and deployment requirements;
(10)
The applicant agrees to provide notice to an affected local governing authority ten (10) days prior to providing service in that jurisdiction; and
(11)
That the application includes a minority-owned business participation plan and the applicant agrees to comply with the provisions of such plan in accordance with §
7-59-313
. The minority-owned business participation plan shall be attached to and become a part of the application when the application is submitted.
(d)
(1)
No later than fifteen (15) days after the filing of an application, the department shall notify the applicant in writing as to whether the application is complete and, if the department has determined that the application is not complete, the department shall state the reasons for the determination in writing.
(2)
After the filing of an application that the department has determined is complete, the department shall determine whether an applicant has the managerial, financial and technical qualifications to provide cable or video service. In connection with that review the department may require the applicant to submit its plan to comply with the requirements of §
7-59-311
. The department shall consider the plan to be sufficient if it includes a clear statement that the applicant has evaluated its deployment plans and reasonably concludes that the plan will result in the required deployment. The plans are confidential and are not subject to the open records laws, compiled in title 10, chapter 7. If the department determines that an applicant is managerially, financially and technically qualified to provide cable or video service and, if applicable, that its plan to comply with §
7-59-311
is sufficient, the department shall issue a state-issued certificate of franchise authority to the applicant. If the department determines that an applicant is not managerially, financially and technically qualified to provide cable or video service or, its plan to comply with §
7-59-311
is not sufficient, the department shall reject the application and shall state the reasons for the determination.
(3)
Notwithstanding subdivision (d)(2), large telecommunications providers, qualified cable operators and incumbent cable service providers, including their subsidiaries and affiliates, are deemed by operation of law to have the managerial, financial and technical qualifications to obtain a state-issued certificate of franchise authority; provided, however, that the department shall be authorized, but not required, to conduct a review of an incumbent cable service provider's financial and technical qualification if the incumbent is seeking a new service area that would double its current size of operations and the incumbent does not have cable or video service assets of at least ten million dollars ($10,000,000) in the state. For the purpose of this subdivision (d)(3), "operations," relevant to whether size has doubled, shall include either the number of additional households to be served or the actual proposed service area.
(4)
The failure of the department to issue a state-issued certificate of franchise authority within forty-five (45) days of receipt of a completed application from any of the entities set forth in subdivision (d)(3) shall constitute issuance of the requested state-issued certificate of franchise authority without further action required by the applicant. The failure of the department to issue a state-issued certificate of franchise authority within one hundred eighty (180) days of receipt of a completed application from any other applicant shall constitute temporary issuance of the requested state-issued certificate of franchise authority to the applicant subject to final approval or rejection of the application by the department.
(e)
The state-issued certificate of franchise authority issued by the department shall contain the following and no other items:
(1)
A nonexclusive grant of authority to provide cable or video service in the areas set forth in the application;
(2)
A nonexclusive grant of authority to construct, maintain and operate facilities through, along, upon, over and under any public rights-of-way, subject to the laws of this state, including the lawful exercise of police powers of the municipalities and counties in which the service is delivered;
(3)
A statement that the grant of authority is subject to lawful operation of the cable or video service by the applicant or its successor in interest; and
(4)
A statement that the grant of authority does not confer upon the holder of the state-issued certificate of franchise authority the right to place facilities on private property without the owner's consent to such placement, except that nothing in this part shall alter the condemnation authority provided pursuant to §
65-21-204
for internal improvements or as provided in title 29, chapter 16.
(f)
(1)
The state-issued certificate of franchise authority issued by the department shall be for a term of ten (10) years. Upon the expiration of the initial term, the holder of a state-issued certificate of franchise authority may reapply pursuant to the process set forth in this section.
(2)
(A)
The holder of a state-issued certificate of franchise authority shall, as a condition of maintaining the franchise authority, pay an annual fee as provided in this subdivision (f)(2) to cover the direct costs of the department in administering §§
7-59-308
and
7-59-312
regarding the resolution of any complaints filed with the department. The holder of a state-issued certificate of franchise authority may designate that portion of the subscriber's bill attributable to the fee established by this subsection (f) and recover such amount from the subscriber as a separate item on the bill.
(B)
For the fiscal year ending on June 30, 2009, the annual fee shall be collected in the aggregate from all holders of a state-issued certificate of franchise authority and shall not exceed one hundred seven thousand dollars ($107,000). In order to fairly assess the fee, the department shall calculate the total number of subscribers obtaining service from holders of a state-issued certificate of franchise authority based on quarterly franchise fee statements as of the end of the second quarter each year provided pursuant to §
7-59-306
. Based on such calculation, the department shall assess each holder of a state-issued certificate of franchise authority a percentage of the amount established in this subdivision (f)(2) for the fiscal year ending on June 30, 2009, to be paid to the department by each holder within thirty (30) days of the date the department notifies the holder of the holder's share of the annual fee. The annual fees for 2009 shall be assessed on July 31, 2009. The percentage shall be calculated by dividing the holder's number of cable or video subscribers served under a state-issued certificate of franchise authority by the total number of cable or video subscribers of all holders served under all state-issued certificates of franchise authority. Notwithstanding such provisions, any payments collected from the state-issued certificate of franchise authority application fees and amendment fees shall be applied to reduce the annual fee required by this subsection (f). In addition, no holder of a state-issued certificate of franchise authority shall be assessed any amounts attributable to enforcement actions directed against another holder of a state-issued certificate of franchise authority other than those arising under §
7-59-308
.
(C)
(i)
For subsequent fiscal years, by September 15 of each year, the comptroller shall review the amount assessed in the previous fiscal year and make a determination as to whether the annual fee should be increased or decreased based on the following factors:
(a)
The actual administrative costs incurred by the department in connection with the reasonable performance of its duties established in §§
7-59-308
and
7-59-312
;
(b)
The actual number of cable or video-related complaints handled by the department;
(c)
The complexity of cable or video-related complaints handled by the department;
(d)
The amount of application and amendment fees collected by the department;
(e)
The amount of personnel time necessary to accomplish the functions of the department relating to holders of state-issued certificates of franchise authority; and
(f)
Any other factors deemed essential by the comptroller to certify a fair annual assessment amount.
(ii)
The comptroller shall certify the annual fee for each fiscal year and notify the department of the maximum annual fee that may be assessed to all holders of a state-issued certificate of franchise authority based on the calculation established in subdivision (f)(2)(B), which fee, if an increase as certified by the comptroller, shall in no event increase by more than five percent (5%) from the previous year's annual fee.
(g)
Any successor in interest to the holder of a state-issued certificate of franchise authority shall apply for a state-issued certificate of franchise authority as provided for in this section and consistent with §
7-59-304(a)(5)
.
(h)
The state-issued certificate of franchise authority issued pursuant to this part may be terminated by the cable or video service provider by submitting written notice of the termination to the department with a copy to the governing authority of the affected municipality or county. The department is neither required nor authorized to act upon the notice. Terminating state-issued certificate of franchise authority holders shall provide all existing customers with ninety (90) days written notice of the termination prior to actual termination and shall refund to the customers any payments or deposits for which service has not been provided. A holder's decision to terminate its state-issued certificate of franchise authority does not relieve the holder of its obligations with respect to the payment of any franchise fees or other funds owed to a municipality or county or the removal of its facilities within the public right-of-way, consistent with local rights-of-way ordinances or resolutions.
(i)
(1)
A cable or video service provider shall file an application to amend its state-issued certificate of franchise authority to reflect any change in information required under subsection (c); provided, however, that the department may not deny the issuance of an amended state-issued certificate of franchise authority unless it has determined, in response to a complaint authorized by this part, that the holder of a state-issued certificate of franchise authority has:
(A)
Acted in bad faith in its failure to comply with its obligations and representations made in its original application or any prior amendment to the application; or
(B)
Acted in bad faith in its withdrawal of service from areas within which there is no access to other cable or video service.
(2)
The applicant must file a copy of any amendment with the governing authority of the affected municipality or county. If the amendment includes new areas within the holder's franchise area, the applicable provisions and requirements of subdivisions (c)(3) and (9) shall be met. Notice must be provided to other entities with facilities in the rights-of-way, consistent with any nondiscriminatory and generally applicable local ordinance or resolution requiring the notice prior to performing any installation in the right-of-way of the affected municipality or county.
(j)
Unless otherwise provided for in this section, the state-issued certificate of franchise authority issued pursuant to this part supersedes and is in lieu of any franchise authority or approval required by state or local law as of July 1, 2008.
(k)
A large telecommunications provider shall apply for an initial state-issued certificate of franchise authority within one (1) year after July 1, 2008. A large telecommunications provider may apply for a local franchise at any time.
(l)
A holder of a state-issued certificate of franchise authority shall comply with all applicable FCC requirements involving the distribution and notification of emergency messages over the emergency alert system consistent with the enforcement of the rules, and any waivers to the rules, as determined by the FCC. To the extent that a local government has the capacity, pursuant to an existing unexpired local franchise, to locally override the cable or video system, that capability shall remain active from the incumbent provider until the natural expiration of the franchise so long as the local emergency override capability is not in conflict with applicable state regulations concerning emergency communications. Notwithstanding an election by a cable provider or video service provider to terminate a local franchise, until the date the franchise would have naturally terminated, an incumbent cable or video service provider shall continue to provide emergency override capabilities that existed as of July 1, 2008, so long as the local emergency override capability is not in conflict with applicable state regulations concerning emergency communications.
Acts 2008 , ch. 932, § 6.