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SB 1004 Update

Texas Wireless Association (TXWA): SB 1004 Update

10/20/17

Senate Bill 1004 (SB 1004), signed into law by Governor Abbot on June 9th and effective as of September 1st, creates a statewide framework intended to make the process consistent for the deployment of small cell nodes in municipal rights-of-way (“ROW”) by small cell network providers.  The bill, which caps rates for access to ROW for small cell nodes at $250 per year/per node and fiber fees at $28 per month/per node allows network providers the ability to attach to existing city infrastructure in the ROW and install new pole plants. Municipalities retain long-held rights to manage the ROW, including the power to require stealth design in city-designated Design Districts.  In addition, it sets specific timelines for municipal review and permitting across the State of Texas.

Over the past few months, a number of municipalities have passed small cell ordinances and design manuals that comply with the state legislation. However, many cities have taken a position that the legislation reduces their ability to regulate the public right-of-way and have passed ordinances that contain provisions that explicitly contradict the legislation.  For example, a number of municipalities have included provisions that require small cell nodes be spaced 300’ from existing utility poles and small cell nodes, limit the number of small cell node applications to 30 pending at a time, and prohibit small cell nodes in ROW in residential areas and municipal parks.

To date, there have been two notable lawsuits filed against the state challenging the constitutionality of SB 1004 – both still pending. The first, led by the City of McAllen, includes twenty-one other Texas cities, most notably Dallas.  The lawsuit challenges the state’s law, arguing, among other things, that the fees set forth in SB 1004 are a “prohibited gift” under the Texas Constitution since the fees set forth in the law for access to the ROW are allegedly below fair market value.  The City of McAllen filed the suit on August 31st, the day before the legislation went into effect, and the State filed its’ Answer on October 2nd.

A second, separate lawsuit, filed by the City of Austin on August 18, claims that the 1996 Telecommunications Act preempts the legislation, because the bill strips Austin’s control to manage the public right-of-way, which is guaranteed by federal law. The lawsuit is still unresolved, though a judge denied the city a preliminary injunction on August 31.

Municipalities across the state continue to navigate this issue in different ways as the small cell providers work alongside them to initiate the process now codified in state law.

We will continue to keep our membership updated as this important subject evolves.

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