EATEL, a family-owned cable, phone and Internet provider based in Gonzales, is running into some surprising opposition to its plan to enter the Baton Rouge market.
The Metro Council has heard requests from EATEL for the past month for a franchise agreement that would let the company begin construction of a network in the parish and offer competition locally to service giants Cox Communications and AT&T.
Janet Britton, EATEL’s director of legal and regulatory affairs, said EATEL is ready and eager to begin providing service in Baton Rouge and contribute to the parish’s tax base.
She said she cannot understand why EATEL, a local business, is being more harshly scrutinized than AT&T was in 2008, when it signed its franchise agreement.
She also finds it unreasonable to immediately expect EATEL to be held to the same standard as Cox, which is a large regional company and the market leader in the parish.
But some Metro Council members have taken issue with EATEL’s franchise agreement because it lacked a “build-out requirement.” The requirement generally insists that a company serve all customers in an area, rather than cherry-pick profitable areas.
A Cox representative attended at least two Metro Council meetings to express opposition to the lack of the build-out requirement.
Britton argues that the build-out mandate would run afoul of federal and state laws preventing local authorities from imposing requirements that impede competitive entry.
Cox has a build-out requirement in its agreement, but Bob Abbott, assistant parish attorney, told the council last month the agreement was signed before state laws were enacted that would have prevented the measure.
AT&T has no build-out requirement in its franchise agreement.
In recent weeks, EATEL submitted to the city-parish a build-out requirement to which, Britton said, the company would be willing to adhere, despite the company’s position that it should not be held to such a requirement.
“It’s more important to have the franchise agreement, than to be right,” Britton said.
EATEL’s proposed agreement, which is similar to Cox’s build-out requirement, says that as long as a residence is in an area with at least 40 residences within a mile of its distribution cable, EATEL would extend service at no cost to the subscriber other than the installation charge. But the major difference is that EATEL proposes this provision go into effect only when it has 50.1 percent of the market.
When asked to respond to this proposal, Sharon Bethea, a Cox spokesperson, said in a written statement: “We would like to see all franchise agreements based on the same set of rules, regulations and standards in order for all providers to compete fairly.”
The build-out proposal was expected to be discussed at the Sept. 14 Metro Council meeting, but Councilman Ulysses “Bones” Addison deferred the item to the Sept. 28 meeting.
Abbott said Addison asked the parish attorney’s office to look into whether it would be possible to eliminate the 50.1 percent clause. Abbott said Tuesday his office has not yet rendered an opinion on the matter.
But Abbot said EATEL can be forced to adhere to a build-out requirement, despite state and federal laws, because the parish operates under a home rule charter.
The Metro Council is scheduled to consider the item on Sept. 28. Ultimately, even if the council does object, EATEL will be able to serve Baton Rouge.
On Aug. 26, EATEL submitted notice that it intends to come to East Baton Rouge Parish.
Abbott said that under federal law, the notice “starts a six-month period to negotiate an agreement, or their original agreement becomes effective.”
Britton said EATEL is negotiating with the parish because it does not want to wait six months to begin work.
“We’re ready now,” she said.
Rebekah Allen covers city-parish government for The Advocate. She can be reached at firstname.lastname@example.org.