Verizon Wireless has sued the City of Rochester, N.Y. in a potentially precedent-setting case, for demanding excessive and discriminatory fees to use public rights-of-way to deploy a fiber backhaul network and hundreds of small cells to support the introduction of 5G wireless service in the community.

The lawsuit, Cellco Partnership (d/b/a Verizon Wireless) v. City of Rochester seeks a declaratory judgment acknowledging that local laws regarding the use of rights-of-way by telecommunications companies have been largely overridden by the Trump Administration’s Federal Communications Commission. Under FCC guidelines, the maximum compensation rate a city can generally collect is $270 annually for each small cell site, far less than what the City of Rochester hopes to collect from telecommunications companies planning to dig up streets and place hundreds of small cell antennas on utility and light poles across the city.

The two parties are far apart on what defines fair and just compensation. In early 2019, the City of Rochester introduced a new fee schedule that seeks $1,500 annually for the use of each publicly owned utility or light pole, and $1,000 per standalone “smart pole” erected by a wireless company to support a small cell. Verizon Wireless wants to pay no more than $270 annually for either type.

The City also wants compensation to cover “administrative costs for retaining and managing documents and records,” “costs for managing, coordinating and responding to public concerns and complaints,” and “the costs of the City’s self-insurance.” Verizon Wireless’ attorneys argue that the FCC’s “presumptive limit” of $270 annually is all-inclusive, and therefore the fees requested are inherently unreasonable.

The City ordinance is also designed to discourage providers from installing cables on existing utility poles, preferring underground installation.

“Aerial installation of fiber or other telecommunications facilities and accessory equipment strung between poles, buildings, or other facilities, is strongly discouraged due to area weather, safety concerns, limited capacity, and aesthetic disturbances,” the ordinance reads. But Verizon Wireless argues the extra fees demanded by the City for underground burial of fiber optic cable are illegal under federal law.

“The Code’s ‘underground’ fee structure is not a reasonable approximation of actual cost, is not objectively determined, and is discriminatory,” Verizon Wireless argues.

The City’s fees for fiber optic cable installation are significant. Verizon Wireless’ lawsuit notes fees start at $10,000 for up to 2,500 linear feet of installed fiber optic cable, plus an additional $1.50 for each additional foot from 2,500-12,500 feet and $0.75 for each additional foot above 12,500 feet. After the first year, fees continue at $5,000 annually for up to 2,500 feet, $1 for each additional foot from 2,500-12,500 feet, and $0.50 for each additional foot above 12,500 feet. Somewhat lower fees apply if Verizon places its fiber cables in an existing conduit with other cables, or if it uses directional boring to place conduit and wiring without disturbing lawns, roads, or sidewalks.

Curtin

Verizon Wireless’ attorneys argue the fees cannot possibly reflect the City’s true costs because the charges are the same regardless if Verizon installed three feet or 2,000 feet of fiber optic cable.

But City Corporation Counsel Tim Curtin told the Democrat & Chronicle the city’s new fee schedule is comparable to what other cities are charging, and the City is planning more restrictions to keep providers from repeatedly digging up streets and yards to place new cable and equipment.

“This is a serious problem with people digging up the same right of way every other day and not repairing it,” Curtin told the newspaper.

The City is also exploring passing a new “dig once” policy that would incentivize providers to coordinate fiber installation to place wiring and equipment in a single shared conduit in return for lower fees. But providers like Verizon Wireless consider it in their competitive advantage to wire cities like Rochester before their competitors do.

“To better serve its customers and the City and to begin to serve new customers and provide new services, Verizon Wireless seeks to extend, densify, and upgrade its wireless network infrastructure [in Rochester], including to install additional Small Wireless Facilities to support the provision of current and next-generation telecommunications services such as 5G and to deploy fiber to connect these facilities. To successfully do this, Verizon Wireless requires new approvals from [the City of Rochester] to access City property,” Verizon’s lawsuit states. Because of the City’s fees and policies, “Verizon Wireless has been, and will continue to be, damaged and irreparably harmed, […] [including] an effective prohibition on Verizon Wireless’s ability to provide telecommunications services in the affected area of the City.”

In short, Verizon Wireless is threatening not to deploy 5G service in the area if the City successfully defends its fees and requirements.

Curtin argues Verizon Wireless is the only provider unwilling to comply with the City’s requirements, while others are moving forward under the new ordinance. One provider likely covered by Curtin’s claim is residential fiber overbuilder Greenlight Networks, which has installed fiber to the home service across several city neighborhoods for the past several years. But in 2019, Greenlight began focusing on installations in suburbs west of Rochester, and several city neighborhoods proposed for service have languished for years with “easements required” status, which could reflect Greenlight’s reluctance or ability to pay the City’s new fees.

Verizon has been the most aggressive wireless provider in Western and Central New York with respect to the proposed 5G service expansion. In addition to being the incumbent local telephone company in several New York cities (excluding Rochester), it has also offered spotty FiOS fiber to the home service in several suburbs of Buffalo and Syracuse.

A small cell

In contrast with Rochester, the City of Syracuse decided to effectively “partner” with Verizon Wireless to deploy 5G small cells to be considered America’s “first fully 5G city.” To win Verizon over, the City mothballed its existing fee policy in 2019 that charged $950 per small cell tower, resetting the rate to match the FCC’s presumed maximum of $270 annually. In return, Verizon has tentatively agreed to place up to 600 smart cell poles around the city, paying $162,000 a year. Verizon also agreed to pay a $500 application fee for each pole project (covering up to a maximum of five poles per project). Nobody is certain whether 600 smart cells are enough to saturate the city with 5G coverage, where exactly Verizon will ultimately place the small cells, or exactly when.

Ken Schmidt, president of Steel in the Air, a consultant to public and private landowners and municipalities on matters related to wireless infrastructure valuation, offered to advise the City of Syracuse for free about its agreement with Verizon Wireless, but the City never returned his calls, despite his direct experience working with other cities that negotiated with Verizon Wireless over 5G smart cells, pole attachment fees, and antenna placement rules.

“Syracuse seems to have bent over backward for Verizon,” Schmidt argues on his blog. “Make no mistake, there are benefits to becoming a 5G city, but this agreement does no more for Syracuse than it does for other cities where Verizon promised the same thing. At least some of the other cities didn’t enter into such a one-sided agreement. For example, Sacramento, San Diego and San Jose negotiated better terms and conditions than Syracuse did, and will have a similarly robust small cell deployment.”

Many consultants recommend that cities consider whether Verizon’s threats not to deploy 5G service are real, especially considering the company’s PR claims that moving forward with 5G is essential to Verizon’s network expansion.

Schmidt

Schmidt acknowledges the current FCC has a vested interest in helping large wireless companies deploy 5G infrastructure with a minimum of interference or fees from local governments.

“While the City could have negotiated a higher amount for the pole access rights or permit fees, it would have had to demonstrate that its actual costs in reviewing small cell applications and maintaining the rights-of-way were higher than the nominal fees allowed by the FCC,” Schmidt said.

Verizon’s lawyers appeared to outmaneuver the City’s attorneys by winning a number of concessions for Verizon that Syracuse will have to live with for up to 45 years. Schmidt’s recommendations may be useful to other cities, including Rochester, wrestling with these issues.

Schmidt:

Syracuse granted rights to Verizon for upward of 45 years when it didn’t have to. The city signed a master license agreement for 20 years, which allows Verizon to install poles under individual pole licenses that run up to 25 years from the date the pole was installed. Thus, if a pole is installed in year 20, it will be there for another 25 years. In short, the city is entering a possible 45-year agreement even though there is no legal requirement to do so by the FCC or any other agency. While Verizon surely prefers a much longer agreement, other cities are entering much shorter, 10-year agreements with Verizon. Verizon retained the right to terminate “at any time for any reason or no reason by written notice to the city,” but the city does not have the same right. So, the city is now committed to this specific agreement legally, regardless of what happens with technology in the future.

The agreement entered into by the city concedes unnecessary rights to Verizon under contract law. The agreement is substantially the same as other agreements proposed by Verizon to other cities. It attempts to incorporate many of the standards from the FCC Order into the license agreement. From a legal perspective, these clauses did not need to be in the license agreement. If Verizon felt the city was not adhering to the FCC order, Verizon by default has the option of requesting relief from the FCC or filing in federal court for injunction or damages. However, by adding the language in the license agreement, Verizon can now file in state court on a civil claim if Verizon believes the city is in breach of the agreement and collect monetary damages. This is absolutely of no benefit to Syracuse.

Other cities have received additional compensation in the form of public safety or “internet of things” monitoring and services, and higher fees to help pay for additional staff to review small cells applications. Syracuse received nothing. In fairness, the other cities are bigger and more important to Verizon than Syracuse. Nonetheless, the only concession Verizon appears to have made to Syracuse is the requirement for Verizon to monitor a limited set of small cells for compliance with applicable radio frequency emission standards. Verizon did not commit to deploying a certain number of small cells by any date. It is not required to deploy in the poorer areas of the city. And it did not commit to smart city initiatives or research on how 5G can benefit the residents of Syracuse.

The agreement gives the city limited rights to terminate, even if health risks are identified and proven. The city, in what appears to be an effort to appease its citizens that small cells are safe, inserted language that requires Verizon to test up to 5% of the small cells annually to confirm that they meet the minimum applicable health, safety and radio frequency regulations. The city could also test on its own, but only to confirm compliance with applicable FCC standards. By agreeing to a long-term license with limited rights to terminate, the city could be legally committed to Verizon small cells in the public right of way even if there is ample evidence that they should be removed, unless the FCC revokes its order.

By agreeing to such a one-sided agreement, the city has condemned itself to agree to similar agreements with any company providing wireless services who want to deploy in the right-of-way. Under the FCC Order and previous case law regarding the Telecommunications Act of 1996, the city may not discriminate between similar providers of wireless services. By agreeing to the terms with Verizon, the city will have a difficult time agreeing to different terms with other providers.

Homeowners in Greenhills, Ohio woke up one morning recently to discover anonymous contractors unspooling cable and planting orange-colored PVC pipes along a Hamilton County right of way on Sharon Road, straddling the communities of Greenhills and Forest Park.

Technological mysteries are uncommon in Greenhills, a planned community built in the 1930s as part of President Franklin Roosevelt’s New Deal program. Greenhills was designed to be surrounded by a “belt” of nature, drawing people out of dilapidated urban settings and into quiet, tree-filled neighborhoods. Many who were offered homes in Greenhills by the Resettlement Administration never left, and their descendents still live in the homes their parents or grandparents once did.

Considering the slow pace of change and the desire to stay a quiet enclave, it should come as no surprise that many residents are disturbed about the quiet invasion of 5G small cells that will be going up all over town, especially because the owner won’t come forward and explain the project.

That layer of secrecy has brought suspicion among neighbors, even those younger ones that understand how much faster 5G service could be over 4G service available today.

“For me, I’d rather not be the guinea pig,” Andrew Steele told WCPO-TV. “That would be terrible,” Anna Steele, Andrew’s wife, added. “That would be horrible. Also, do we really even need it?”

A closer inspection of the infrastructure being installed shows Verizon is the most likely silent operator, which makes the prospect of millimeter wave 5G service for the community of 3,600 very likely. That could mean a new home broadband competitor in the area. But many residents do not want an option that includes small cell antennas.

Monique Maisenhalter told the TV station she was concerned about cell tower radiation causing damage to health and the environment, although such evidence is open to debate.

She and nearly 50 of her neighbors have signed a petition asking for the construction to cease until “more is known.”

Some believe there is no need for 5G service when 4G works well enough. Others are concerned about property values being lowered by the presence of multitudes of small cell antennas. Others object to the fact the equipment is being installed without full disclosure about exactly who is behind it. Even town leaders are flummoxed, as WCPO reports:

The mayor of Greenhills, David Moore, said he has no say over the fiber line installation because the lines are actually going up across the border in Forest Park, on a Hamilton county right-of-way on Sharon Road.

So we went to Hamilton County engineer Ted Hubbard, who said he, too, is struggling to find out who is laying the fiber and what their plan might be.

“The ownership is a big question,” Hubbard said. “And I have asked that. We are having a hard time finding out who actually owns it.”

Hubbard said several small contractors have received permits to install the lines but won’t tell the county who is behind the whole project.

“Who’s going to operate it?” Hubbard asked. “And who do we contact if there is an issue?’

WCPO in Cincinnati investigates mysterious new 5G infrastructure appearing in northern suburbs of Cincinnati (3:19)

 

Twenty-two Texas cities are taking Charter Communications and its corporate predecessor, Time Warner Cable Texas LLC, to state district court for systematically underpaying franchise fees worth more than $1 million.

The lawsuit, filed Friday in Waco, accuses Time Warner Cable and Charter of cheating the Texas communities out of fees for using the public right-of-ways.

Austin attorney Thomas Brocato, representing the plaintiffs, alleges the city of Waco alone is owed several hundred thousand dollars, while nearly two dozen others could share a combined recovery in excess of $1 million if the suit is successful.

Earlier this year, 33 Texas cities filed a lawsuit against Charter Communications making similar allegations. In that case, an auditor found Spectrum had underreported more than $2.25 million allegedly owed to the cities.

The latest cities to file suit allege a recent detailed audit uncovered several instances where Time Warner Cable and Charter/Spectrum did not apply the 5% franchise fee on every transaction the two companies should have. The lawsuit claims the cable companies did not include “processing-reconnect fees” as gross revenue for the purpose of paying franchise fees. The companies also excluded revenue collected from chargeable commercial service calls and failed to fully report all advertising revenue earned showing local commercials on cable channels.

The lawsuit accuses the companies of intentionally underreporting, noting the underpayments continued despite the use of two different accounting methods used to calculate franchise fees due local communities.

Plaintiffs in the latest lawsuit include the cities of Allen, Arlington, Bedford, Belton, Carrollton, Cedar Hill, Colleyville, Coppell, Dalworthington Gardens, Euless, Fort Worth, Garland, Grand Prairie, Harker Heights, Hutto, Irving, Killeen, Lewisville, Mesquite, Rockwall, Rowlett and Wichita Falls.

In 2017, negotiations between the city of McAllen, Tex. and wireless companies over the cost of placing new wireless infrastructure neared agreement at $1,500 per network node, an amount not out of line with the kind of infrastructure fees being charged in other cities where utilities want to place their equipment in the public rights-of-way. But just before contracts were ready to sign, the wireless companies broke off negotiations with city officials and began lobbying for a new Texas state law that would set the terms and conditions for placing telecommunications infrastructure statewide regardless of the wishes of individual Texas towns and cities.

SB 1004 was the kind of bill companies like AT&T love. Drafted from talking points supplied by the telecom industry and introduced by a friendly legislator — Republican State Sen. Kelly Hancock, (dubbed “THE WORST” by Texas Monthly magazine) — AT&T and Hancock partnered up to push the legislation through the state legislature, with the help of more than 100 lobbyists working with a budget of $7.8 million, according to a Texas Monitor analysis.

AT&T counts Texas as its corporate home, and company spends lavishly to have its way. It has been the largest lobbying force in the state by far for at least two decades, with 108 registered lobbyists. In second place is TXU Energy Retail, which registered just 29 lobbyists. AT&T offers politicians in the states where it provides local phone service a continuous fountain of campaign contributions. Since 2007, AT&T has spent more than $2.2 million on Texas politicians alone. AT&T donated to 175 of the 181 members of the Texas House and Senate, and its legislative achievements are impressive, winning passage of 14 of the 28 bills the company supported or wrote. Hancock counts AT&T among his top corporate donors, along with the former Time Warner Cable and Comcast.

SB 1004 will cost Texas communities a substantial amount of local control over wireless infrastructure, along with millions of dollars in pole attachment and oversight fees. Hancock, who has no background in telecommunications, arbitrarily set fee caps on wireless facilities at $20 a year for locating equipment on an existing pole and $250 a year if a company attaches equipment on something else. To observers, it isn’t just a bargain for the wireless industry, it could also means some towns and cities could be forced to spend public tax dollars to manage and monitor wireless company infrastructure should something goes awry.

McAllen is among 31 cities in Texas fighting to overturn AT&T’s state law. The city is upset because SB 1004 strips its authority to manage public rights-of-way. By bending over backwards to the wireless industry, companies can put 5G small cells and other equipment just about anywhere with little recourse. In fact, the Texas law mandates companies use pre-existing street signs, traffic garages, and street/traffic lighting as antenna locations wherever possible, which is good news for AT&T but could cause visual pollution and potential safety issues for residents. With below-market attachment fees topping out at just $250, four major national wireless companies can sprout antennas all over town, whether they create eyesores or not.

Bennett Sandlin, executive director of the Texas Municipal League, called that an “unconstitutionally low amount of money.”

“It’s mandatory that when private companies want to make a profit using public land that they pay a reasonable rental fee for it,” Sandlin told the Texas Monitor. “Just like if AT&T wanted to run these facilities through our backyard, we wouldn’t let them do it for free.”

Sandlin adds the wireless industry wants to be given special privileges under the guise of expanding internet access in return for getting cheap access to public rights-of-way, but they don’t want to be regulated like a public utility.

If the new law stands, it is estimated that Texas cities will lose up to $800 million a year in revenue from fees — money that will probably be made up by increasing taxes or other fees.

In Tennessee, the state has gone all out to hurry the passage of a similar law in hopes of convincing wireless companies to make the state one of the first targets for 5G expansion.

Sen. Bill Ketron (R-Murfreesboro), believes clearing a path for rapid 5G deployment will attract billions of dollars of new investment in the state.

“It’s going to transform the world as we currently know it. We’re expecting speeds anywhere from 30 to 50 percent faster as far as connectivity is concerned,” Ketron told his colleagues in the Tennessee legislature. “It opens up that bandwidth for all the data, everything that we’re doing from texting to telemedicine to even autonomous vehicles.”

House Bill 2279 and its companion SB 2504 are written almost word for word on the recommendations of AT&T and other wireless lobbyists. Like a Christmas tree decorated with ornaments, all of AT&T’s legislative priorities can be found in both bills, and not by accident. The phone company’s lobbyists have worked hand in hand with other internet providers, lawmakers, and local governments and co-ops to push the bill for rapid passage. After four months, it is nearing the governor’s signature.

The handful of critics, mostly Democrats, have been reduced to offering concern about the bill’s impact on local self-governance. Sen. Lee Harris (D-Shelby County) told colleagues, “I’m inclined to support this bill, but it does give me pause that we would intervene in these negotiations and set a price,” referring to the bill’s capped application fee of $100 per small cell installation, with a $35 annual renewal fee.

Ketron has frequently defended the bill’s cap on fees, which most observers claim are substantially lower than what wireless companies expected to pay, by claiming he wanted to prevent cities and towns from “cashing in on poles because that would be passed on to all the users through their rate fees, and I know my bill is already high enough.”

Sen. Ketron moving HB 2279 forward in the Tennessee legislature on April 11, 2018.

The potential revenue hit to municipalities would normally be enough to rally opposition, but because of AT&T’s lobbying efforts, most cities and counties in Tennessee have remained neutral on the bill, signaling a virtual guarantee it will become law. The company has worked hard to try to reassure communities the new law will be revenue neutral and be sensitive to the aesthetic needs of local communities. The bill promises that in the event a small cell damages or brings down a pole, the owner of the equipment will be responsible to fix the damage or provide an identical replacement light or pole at the company’s expense.

But based on stories from other communities that have gotten small cell technology for existing 4G LTE networks, problems remain. The biggest issue for residents is visual clutter on poles in their front yards. Some companies also install “lawn refrigerator” cabinets that house backup batteries or other equipment to keep small cells operational in the event of a power outage. Residents frequently complain about these unsightly metal boxes that can appear overnight in the public right-of-way, sometimes right in front of their home, with no warning.

Some town engineers also question the safety of some installations, particularly if multiple carriers seek to place equipment on the same poles. Some have expressed concern about what impact the extra equipment might have in a vehicle collision that brings a pole down onto another vehicle. There are also broader implications once a town surrenders authority over its public rights-of-way to state officials.

Ketron’s personal knowledge of 5G technology and his credibility to deliver on the promises and claims he has made to his colleagues is also open to question. During a brief floor session to consider House Bill 2279, Ketron frequently became tongue-twisted explaining the merits of 5G networks, their functionality, and what benefits they will offer rural Tennessee consumers.

In rambling introductory remarks, Ketron claimed, “the connectivity speed through that bandwidth what 5G brings us […] all are going to be communicating through all that bandwidth of that data.” He also promised a colleague in rural Tennessee that 5G service had a real potential to solve the state’s rural broadband problems, despite the fact the technology would be very costly to deploy in rural areas because of required fiber backhaul and the limited range of each small cell.

The Tennessee Electric Cooperative believes 5G deployment will likely stop with the suburbs, unlikely to expand into rural areas because of its limited range.

“Because of this, we don’t anticipate it will ever see widespread use outside of densely populated areas,” Trent Scott, spokesman for the organization told the Memphis Daily News. “The economics of deploying current 5G technology in sparsely populated areas are going to be a challenge.”

But the idea of AT&T and other wireless companies spending billions on new wireless infrastructure in Tennessee attracts political support for the short-term jobs for installers. The future of 5G technology and its use with Tennessee’s smart grid and intelligent transportation projects of the future may explain why the bill has attracted 40 co-sponsors.

But on the local level in communities like McAllen, there is also recognition wireless companies stand to earn tens of billions from the next generation of wireless technology, and they will be able to earn that revenue at a relatively cheap cost if communities surrender their ability to leverage their publicly owned assets like rights of way. McAllen officials hoped to negotiate a new network of public hotspots to help bring internet access to those who cannot afford traditional internet subscriptions. If AT&T agreed, the city was willing to steeply discount their fees. But no companies showed any interest in the idea. With enthusiastic state legislators willing to introduce legislation tailor-made for those companies, they didn’t have to.

The Tennessee legislature debated passage of the state’s 5G-related legislation for just 15 minutes before passing it 32-1. But did members truly understand it? (14:44)

Some residents in Houston and Dallas are furious at AT&T and its contractors for causing major damage to homeowners’ property, in one case burning down a Houston family home after accidentally hitting a natural gas line that resulted in a fire.

Joyce Skala’s home in Cypress was seriously damaged in a fire just before Thanksgiving 2017 and almost three months later, Skala says AT&T and its contractors won’t talk to her about the damages and who will pay for them.

“Everything you look at when you leave your house in the morning, it was gone,” Skala told KPRC News after the Nov. 14 fire. “I have not heard from a soul — not one. Not even a representative of a representative.”

The damage was not an isolated incident. KPRC noted two days later, AT&T’s contractors damaged an electric line in Shelli Moore’s yard in a different neighborhood, causing a power outage. Repairing the damage will cost her almost $2,000, and so far, Moore appears to be left holding the bill.

“That would break me,” she said. “I have no idea where I would come up with that kind of money, but we have to have lights and heat,” Moore said.

Joyce Skala’s home, destroyed by fire after an AT&T contractor hit a natural gas line (Image: KTRK)

In the Dallas-Ft. Worth area, utility workers made themselves right at home at Norma Logan’s home, using her back patio as a dining area and completely “trashing” her backyard.

Logan came home to find AT&T digging a deep trench along her back fence, damaging sections of it, as well as destroying her personal property. Then they left without a word.

“They broke many things out there,” Logan told KTVT. “They broke the fence. They broke the statue. They broke some of the things that I use to decorate the flower bed.”

A day later, the workers returned unannounced, this time with heavy equipment that continued to tear up her yard. But before getting to work, they spent a leisurely breakfast at her patio table just outside her back door. They didn’t bother to clean up after they finished.

The subcontractor responsible in these cases was NX Utilities, which has piled up a number of complaints against it since last fall. But AT&T appears to still be using the company to construct its fiber to the home network in both cities.

Contractors left evidence of their presence behind. (Image: Logan)

Anni Shugart’s Cypress home was damaged by an electric surge, and AT&T didn’t want to talk to her about the damage to her home either.

“I couldn’t get anywhere with AT&T,” Shugart said.

Shugart, like others, was left holding the bill after AT&T denied her claim, suggesting they are not responsible for the damages. They pointed her to NX Utilities, but that didn’t make much difference either so she called her insurance company, which is covering her repairs, except for the $4,500 deductible she is paying out of pocket.

“Well, I hope I’ll get it back eventually,” she said. “It’s a lot of money.”

Two days later, contractors hit another gas line. Four days after that they cut another underground power line.

“People in my neighborhood are mad at AT&T,” homeowner Pam Grossman told KPRC.

AT&T claims that it is not directly responsible for the damage, because it was caused by its third-party contractor NX Utilities. In fact, NX is just one of several layers of contractors working on AT&T’s fiber project, and in the event of a problem, the contractors are excellent at pointing fingers at one another.

KPRC reports when the fire marshal turned up to investigate the fires, the report included claims from contractors blamed each other while holding themselves harmless.

“There was no way that his company was involved in the fire,” said the owner of Connect Links in the fire marshal’s report.

KPRC in Houston reviews the damage being done in the Houston area by AT&T’s subcontractors managing the company’s fiber buildout. (3:58)

AT&T contractor NX Utilities allegedly damaged Norma Logan’s fence in the Dallas-Ft. Worth area. (Image: KTVT)

AT&T won’t say how many damage reports about it or its contractors have been filed in Houston and Dallas-Ft. Worth. But AT&T did say it was doing both cities a big favor by enabling them for gigabit fiber internet, and regrets the problems that have developed along the way.

“Our goal is to minimize impact on residents before, during and after construction and to keep them informed through a variety of means throughout the network expansion process,” AT&T said in a statement. “If construction-related issues do occur, we work quickly to resolve and restore any impacts from our work.”

The key emphasis is “our work” and AT&T feels its subcontractors are responsible for fixing their own problems.

“Whether large or small, these damages impact the public and that is not lost on us,” AT&T said. “We track damages and other issues and review performance with our contractors performing the work. As we identify poor performers, we cull those out. Damage can occur for a number of reasons, from contractor error to locates not being accurate. Before we begin a project, we talk with locating firms to provide them with some high-level visibility into where we anticipate completing work on a regular basis. Furthermore, as a part of the large project locate process, we typically provide 30-60 days’ notice versus the minimum 10 days.”

Logan discovered utility workers dug this trench in her backyard along the fence line. (Image: KTVT)

AT&T says projects of this large size and scope require careful planning and implementation, and the company has gotten significant experience managing fiber upgrades in a number of cities where it provides telephone and broadband service.

“We have dozens of supervisors and inspectors in the field to ensure our contractors are performing to our standard,” said AT&T. “We work closely with city officials to ensure our work is done in a timely and orderly fashion. Our contractors are trained to obtain proper permitting, closely follow local construction codes, and abide by rules governing rights-of-way and property easements.”

But many homeowners report they never got any advance notification about the construction work and even less often understood how it would impact on their property.

Logan said she received no notification, despite claims by NX it placed fliers on her door. But those fliers said nothing about heavy construction equipment being brought in, driven over grass and into a cramped backyard to dig. Logan was incensed as she watched equipment dig a trench several feet deep along her backyard fence line, ruining some of her lawn ornaments and damaging her fence.

A second day of empty coffee cups and fast food wrappers left on her patio table was also an unpleasant reminder of their presence.

NX later claimed they reprimanded their workers, not for the damage done to her property, but for not cleaning up their trash as they left.

The sudden arrival of heavy equipment attempting to navigate into Logan’s backyard only upset her further. (Image: KTVT)

AT&T is not the only telecom company that receives criticism for property damage while installing fiber cables. Google Fiber generated “hundreds of complaints” in the Austin area for construction mishaps, including alleged flooding from backed up storm drains that damaged multiple properties. In Charlotte, N.C., Google was accused of causing damage to water wells and allegedly struck a sanitary sewer, flooding a home with raw sewage.

Since September 2015, Charlotte city officials have cited contractors for ordinance violations more than 40 times for $21,300, data show. That included $14,200 in general violations and $6,700 for closing a portion of a right-of-way without the proper traffic control. Fines ranged from $100 to $1,800. Ansco, a contractor for AT&T, was cited the most: 17 times for $8,400. Bechtel, which does work for Google, was cited six times for $2,100, including fines that also mentioned another subcontractor.

How to protect yourself

If a company is performing work involving installation of underground cables, that carries the greatest risk of potential damage to property or other utilities. Many mishaps are caused by inaccurate maps that purport to show where other underground utilities are installed. In some areas, those maps are incomplete or wrong. In the United States, these problems are so serious that there is a nationwide free hotline – 811 – available to consumers and contractors for free on-site location flagging of where underground utilities are actually located.

AT&T is installing fiber optics in several Texas cities.

You can request your own site survey at no charge and photograph the results for your records.

Here is how to request a site survey:

• Call 811 from anywhere in the country at least two days before digging and your call will automatically be routed to your local one call center. Visit the 811 service state map to see if your local one call center accepts online requests.
• Give the operator information about how to contact you, approximately where you or a contractor will likely dig, and what type of work will be done. If you don’t know all the details, that is okay. Request a general assessment of where utilities have placed their cables on or near your property and let 811 know a contractor hired by the telecom company will be doing the work independently.
• Utility companies who have potential facilities involved will be notified of the imminent arrival of a contractor preparing to dig on or near your property.
• Each affected utility company will send a location team to mark the approximate location of underground utility lines. Sometimes they spray paint the location on grass or pavement in different colors reflecting the service. In other cases, they plant small plastic flags in a line where the cabling is located. This typically occurs within 2-3 working days, but some states may have different rules.  To access specific information about your state, visit the 811 state map.

Contractors are usually required by ordinance to notify you in advance of any utility work that is done on or near your property. This notice is usually in writing and can be a mailed or placed flier or a doorhanger card. Retain this notification until the work is complete. It will generally include contact information about the company doing the work and what to do in case a problem arises, and most importantly, who to contact.

Prior to the arrival of the construction crews, photograph your yard to document its current condition. Make sure to get clear photos along property lines or easements, documenting the condition of fencing, landscaping, and any pre-existing structures. If damage occurs, you will have before and after photos to show the contractor, town officials, and/or your attorney.

If possible, stay home on the day work is being done. Making your presence known will greatly reduce the chance utility workers will be careless with your personal property or how they conduct themselves. Document any suspicious or disturbing activity by taking video on your cell phone. Watch for workers attempting to access areas of your property unaffected by the work. They do not have the right to use your outdoor furniture for lounging or eating. They also do not have the right to relieve themselves in your yard.

Buried wire flags

In every case, they are responsible for reasonably restoring your property to the same condition it was in before they arrived. That means repairing ruts or reseeding disturbed portions of your lawn, repairing or replacing damaged items like fencing, lawn ornaments, buildings, and other personal property. If they damage or kill a tree, they are responsible for removing and replacing it, if it was located on your property and not in an easement (in those cases, contact your local town or city officials and ask how to proceed.)

If you discover damage to another company’s infrastructure (or public utilities), call the affected company or public utility right away. They will need to document the damage and arrange for repairs. If a utility power line is knocked down or damaged between the pole or yard pedestal and your home, some companies may require you to hire a private contractor to replace the line. You will want to notify the contractor that did the damage about the incident and begin documenting the process to receive reimbursement.

It is not your responsibility to navigate a company’s complex maze of contractors and subcontractors. Contact the telecom company doing the work and insist they identify the contractor involved and agree to liaison with you to get the matter resolved quickly to your satisfaction. They cannot walk away from their responsibility to correct damage just because they chose to hire an independent company to perform work on their behalf.

When an AT&T contractor hit a utility line, it caused a power surge damaging homeowners’ utility boxes and outside walls. (Image: KPRC)

KPRC asked Texas real estate attorney Nikolas Spencer about who is responsible in these cases according to Texas state law.

“All of them are,” he said. “If they know that this particular subcontractor is routinely causing fires at people’s houses, or even just nicking the lines themselves, that’s a repeated and dangerous situation that AT&T is on notice as happening. They’re responsible for that.”

Your municipality may be willing to share violation details about contractors performing work in your area. If you can document repeated instances of careless work or violations, that can be strong evidence to prove AT&T was aware of the situation, yet continued to use an offending contractor.

KPRC recommends hiring an attorney if severe damage is caused by a utility. For minor property damage, you may get fast results asking for a supervisor or filing a complaint with the Better Business Bureau or a state Attorney General’s office. Those complaints are generally forwarded to a senior customer service manager better empowered to get quick results.

Having a fiber optic upgrade is almost always a good thing, and can increase the value of your home in a sale. But for many homeowners, it has been decades since major utility construction work was done in older neighborhoods and people can forget the disruption, noise, inconvenience, and occasional damage that can be done along the way. Those best prepared in advance to fight for their interests are the most likely to win quick resolution and satisfaction from utility companies that do damage and may not have adequate resources (or interest) in correcting the problem before you give up in frustration and go away.

KTVT in Dallas reports AT&T’s fiber construction crews have damaged personal property and inconvenienced customers. (2:03)