H.R. 5290: Cable Transparency Act

The proposed bill, known as the Cable Transparency Act, seeks to amend the Communications Act of 1934 in order to change certain provisions related to cable franchise agreements. Here’s a summary of the key changes proposed in the legislation:

1. Franchise Requirement Modifications

The bill allows cable operators to apply for the elimination or modification of any requirements in their franchise agreements. Here are the specifics:

• The cable operator must submit a request to the franchising authority for any desired changes within their franchise agreement.
• The franchising authority is required to respond within 120 days. If they do not respond, the requested modifications are automatically deemed approved.
• The cable operator must demonstrate good cause for the requested changes, which may include:
  • Compliance with federal or state laws
  • Changes in technology that make the requirement outdated
  • Situations where fulfilling the requirement has become commercially impractical due to unforeseen changes.

2. Franchise Duration and Termination

The bill stipulates that a franchise will remain in effect indefinitely until it is either terminated or revoked under specific conditions:

• A franchise cannot be revoked by a franchising authority or terminated by a cable operator, unless the operator requests termination explicitly.
• If the cable operator requests termination, the franchise is automatically revoked 90 days after the request is received, unless the franchising authority acts before that time.
• The only time a franchising authority can revoke a franchise is if the cable operator significantly fails to meet its material requirements, and the operator fails to address these issues after being given a chance to remedy them.

3. Appeal Process for Denials

If a cable operator’s request to modify franchise requirements or to terminate the franchise is denied, they have the right to seek judicial review of that denial. In such cases:

• The court will only grant the requested changes if the cable operator proves that they meet the criteria set out in the bill.

4. Technical Amendments

The bill contains technical amendments to ensure that the Communications Act of 1934 aligns with the new provisions. This includes removing references to franchise renewals and simplifying related definitions to streamline the process.

5. Effective Date

The amendments outlined in the bill are set to take effect six months after the bill is enacted. They will apply to franchises granted on or after this effective date, as well as those that are currently active or recently expired, provided that the cable operator continues performing under the agreements.

Relevant Companies

• TWC (Charter Communications, Inc.): As a major cable operator, changes in franchise requirements could impact its operations and compliance costs.
• CMCSA (Comcast Corporation): Could see significant impacts due to the bill’s provisions regarding franchise modification and termination processes.