AUGUSTA, Maine — A proposal looking to revamp how cable providers pay fees to Maine cities and towns has led to months of debate among legislators, public access channels, cable giants and the business lobby over what it would actually do.
The sides have accused each other of stretching the truth, creating what the Maine Municipal Association called a serious case of “he said, she said.” The bill is on track to reach Gov. Janet Mills after initially passing the House and Senate in January.
Proponents say it will ensure cable companies honor their agreements to bring broadband to Maine homes while preserving the ability of towns to use revenue from the deals as they see fit. They have denied claims from opponents — including the Maine State Chamber of Commerce — that it will lead to higher fees for consumers on the back end.
What would the bill do?
The amended proposal from Rep. Melanie Sachs, D-Freeport, is cosponsored by Democrats and Republicans including Sen. Rick Bennett of Oxford. It would affect municipal franchise agreements, the contracts between towns and cable providers or others that sell electronic entertainment on public right-of-way infrastructure such as poles and wires.
Forty years ago, the federal government established the right for communities to charge fees for the right to use those poles and wires. The pending bill would clarify that cable providers must provide internet service in the towns where they have negotiated franchise agreements and that communities can assess the quarterly fees if operators are providing video services this way.
The legislation would continue to allow Maine towns to use the revenue from the contracts for any purpose, whether to support public access television or to bolster local ambulance services.
It would explicitly ban cable companies from shifting costs of equipment upgrades onto subscribers and allow towns to recover unpaid fees if providers violate the new rules via the Maine Unfair Trade Practices Act. Providers can still recover fees assessed to consumers to a certain extent under existing law and terms they negotiate with municipalities.
The bill has additional provisions, such as density requirements for line extensions and establishing a 30-day notice for the movement of channels to a different tier or lineup.
The bill does not raise fees on consumers — at least directly.
Sachs has noted that the Legislature’s fiscal office has estimated only minor costs to state agencies under the bill.
She and other supporters — including community media groups, the Maine Municipal Association and Maine Connectivity Authority — have reiterated the bill proposes no new taxes, fees or charges while protecting Maine towns from costly litigation with cable companies. Attorney General Aaron Frey’s office said it would pass legal muster.
“Paying for litigation when these companies may decide not to comply with the law could actually increase property taxes,” Sachs, Bennett and Sen. Nicole Grohoski, D-Ellsworth, wrote in a Bangor Daily News op-ed. “We heard this time and again from towns all over Maine.”
Providers with no public right-of-way facilities, such as Netflix and other companies with streaming services, would not face the franchise fees.
But the Maine State Chamber of Commerce, led by CEO Patrick Woodcock, has been the main opponent in arguing it would lead to higher streaming fees. Other opponents include Spectrum parent Charter Communication, Comcast and the Motion Picture Association, which represents the five major film studios.
The chamber said Maine would stand out nationally for applying franchise agreements on streaming services by requiring providers to fund public right-of-way infrastructure costs that will get passed onto consumers.
The chamber said franchise fees under federal law can be 5 percent. It pointed to a November survey of Maine voters that found 69 percent would oppose “a new 5 percent fee on the monthly cost of streaming services” to argue there is broad opposition to the bill.
But the state chamber is not seeing eye to eye with all members on the proposal. Damariscotta Region Chamber of Commerce President Larry Sidelinger, who also leads Lincoln County TV, said Woodcock never approached him for thoughts on the bill, which Sidelinger supports. He cited Newcastle’s long battle with Spectrum to renew a franchise agreement.
“The opposition is trying to say the Peacocks and Hulus and Netflixes are going to have to negotiate with every town” and raise fees, Sidelinger said. “That is blatantly false.”
Mills opposed a similar proposal in 2021, but the state likes this one.
Mills vetoed a similar proposal in 2021 over concerns it would raise costs for consumers and shift oversight from communities to the Maine Public Utilities Commission, but her administration’s broadband office and Frey testified in support of this year’s amended bill.
The House and Senate votes on the bill mostly fell along party lines. Several members stood apart from party colleagues, including Senate President Troy Jackson, D-Allagash, and Sen. Joe Baldacci, D-Bangor, who opposed the measure, and Rep. Tammy Schmersal-Burgess, R-Mexico, who bucked most of her party to support it.
All of this means the measure is likely to win enough support to get through the State House this time around.
