Mr. FRIEDEL. Do you know whether any CATV stations were given hearing before they came out with rules and regulations? Mr. RODGERS. No, sir; I am not familiar with that.

Mr. FRIEDEL. Was anyone given a hearing before the Federal Comnunications Commission on the rules and regulations?

Mr. RODGERS. I am not sure but it is my understanding that no hearngs were held but I am not sure about that.

Mr. FRIEDEL. That is all, Mr. Chairman.

The CHAIRMAN. Mr. Devine.

Mr. DEVINE. No questions.

The CHAIRMAN. Mr. Dingell.

Mr. DINGELL. Thank you very much. Mr. Rodgers, you said aside from the CATV pickup the business of the CATV companies is prinarily local in character because of the relatively small number of subscribers and service areas.

Let us take some of the fairly large metropolitan areas in this country with their proposed communities on both sides of the State border.

Do you want us to believe that one State regulatory agency can adequately regulate CATV under those circumstances then?

Mr. RODGERS. Yes, sir; I think that it could because there is precedent in the regulations of local telephone exchange service. You see, our language that we propose is analagous to the language which has been in the Communications Act from the beginning.

That is why we put in our provision that even though engaged in interstate or foreign communications so what could be done when the lines are in one State the local authorities could issue the franchise for use of the street and regulate the rates and crossing over the other side the same thing could be done on the other side.

We have a precedent that would illustrate that is a workable pro

gram.

Mr. DINGELL. You come from what State, sir?

Mr. RODGERS. Georgia.

Mr. DINGELL. What about programs which, let us say, originate in New York and are transported to Georgia by microwave or by wire for broadcast on CATV channels down there. Would you have us believe that you could adequately control and regulate every phase of that CATV until it hits the border of your State?

Mr. RODGERS. No, sir. If there is to be program regulation that will have to come from the Federal Government.

We take no position on that. All we are concerned about is the local aspect, such as rates and franchise.

Mr. DINGELL. You make no comment with regard to companies which would pick up the signal, let us say, in New York and transport it to Georgia or Michigan or any of the other States of the that are many hundreds of miles distant?

Mr. RODGERS. That is right. That would be beyond State regula

tions.

Mr. DINGELL. Clearly, if the public interest were to be protected there would have to be some other agency of the Federal Government that would step in to protect the public interest?

Mr. RODGERS. That is right on an interstate signal.

62-610-66-23

Mr. DINGELL. Thank you very much, Mr. Chairman.

The CHAIRMAN. Mr. Nelsen.

Mr. NELSEN. No questions.

The CHAIRMAN. Mr. Van Deerlin.

Mr. VAN DEERLIN. No questions.
The CHAIRMAN. Mr. Broyhill.

Mr. Pickle?

Mr. PICKLE. Thank you, Mr. Chairman.

Your association is listed as the National Association of Railroad & Utility Commissioners. Just as a matter of background of your organization, how many States do you represent?

Mr. RODGERS. We represent all 50 States, the regulatory commission in all 50 States. The Texas commission is a member of our association. Mr. PICKLE. What is that?

Mr. RODGERS. The Texas Railroad Commission.

Mr. PICKLE. Now your resolution represents your thinking?

Mr. RODGERS. Of course they regulate both railroads and motor carriers. They have not gotten involved in CATV. In other words, in our language

Mr. PICKLE. I am simply asking the scope of this endorsement with respect to my own statement. I have not heard a word from them. Yet you appear as if you speak for my State.

Mr. RODGERS. Yes, sir. This is a position which was first formulated at our national conventional in New York. As I recall, I am not positive, but as I recall the commissioners from the Texas commission were there and I would assume they voted on the resolution because it was passed unanimously.

Mr. PICKLE. Are you saying that by virtue of your resolution and the model act you have drafted that this represents the unanimous feeling of 50 States?

Mr. RODGERS. Yes, sir; that is my impression.

Mr. PICKLE. Has this matter ever been referred to the Governors' conference?

Mr. RODGERS. No, sir; but we have sent copies of our act to the Council of State Governments but it has not been referred to the Governors' conference.

What our language does is that then it simply reserves to the States, however they want to handle it, whether through municipalities or through the State commissions, the right to regulate the local aspects of CATV.

Mr. PICKLE. I was just interested. This was a relatively new approach so far as I am concerned but I have heard nothing from any source about the States' endorsements. Then it gives the impression that the State officials think this ought to be the approach to it. I just make this as an observation but I am wondering if this is not something that an association such as yours has decided to-it ought to be a good thing and you ought to be in on the act?

Mr. RODGERS. It is our position that the local aspect should be regulated locally, which I think is a position which inures to the benefit of every State.

Mr. PICKLE. I thank you.

The CHAIRMAN. Mr. Harvey.

Mr. HARVEY. No questions.

The CHAIRMAN. Mr. Rooney.

Mr. ROONEY. Mr. Rodgers, your association is concerned about the local consumer with respect to the degradation of service or the amount that the individual will be paying for the service of the CATV companies?

Mr. RODGERS. Yes, sir.

Mr. ROONEY. Those are the two primary reasons?

Mr. RODGERS. Primarily.

Mr. ROONEY. Tell me where in this area and throughout the United States, then, is there such a problem? What areas in the States have overcharge of service and degradation of the signal?

Mr. RODGERS. Well, the reference we have on that is by Commissioner Laughlin of the Connecticut commission. He is chairman of the Connecticut commission. In his speech before the New York convention he cited illustrations of where there was an undue return made by CATV companies.

I do not know.

Mr. ROONEY. Cite an example.

Mr. RODGERS. I will be glad to furnish you a copy of the speech but he cited the illustrations.

What we ask here, our language that we ask be inserted in the bill does not declare it to be a public utility. It does not automatically place them under State regulations. It merely gives the authority to the States if the problems arise to handle the matters locally. So in the State, if the problem does not arise, I assume State regulations will not be forthcoming but if it did arise then the State would be equipped to handle it.

Mr. ROGERS of Texas. Will you yield at that point?

Mr. ROONEY. I will be hapy to.

Mr. RODGERS of Texas. Actually, what it does is limit the Federal Communications Commission to program control, does it not? Mr. RODGERS. That is right, primarily.

Mr. ROONEY. Don't you believe, Mr. Rodgers, that the local municipalities can better determine the suitability of the applicant and the public need rather than the State organization or State-controlled agency?

Mr. RODGERS. That is why our proposal on page 6 is as broad as it is because we say State commission or by local governmental authority. So that decision I think appropriately addresses itself to the legislature of each State. Of course from my own point of view, and because we represent State commissions, we think it is best handled by State commissions because they-the municipality stops at city lines and we have unincorporated urban areas that might not be adequately protected although it is handled by counties.

Our position is open-ended and it could be turned over to the municipality or county if the State legislature felt that was in the public

interest.

Mr. ROONEY. Could you site an example of where the State or municipality might have had a duplication of service to the CATV consumer?

Mr. RODGERS. No, sir. I know of no instance

Mr. ROONEY. But this is one of the reasons why your association want to step into this field and has made this recommendation?

Mr. RODGERS. I think what could happen, and this is purely hypothetical, I would think that it would be uneconomic to duplicate cable facilities. When you once run cable down the street I don't think another CATV company should come in.

Say a CATV decides we will charge $5 and we will say that is a fair charge. A CATV company might decide later on, “let us try six or seven. You know we have people depending on this thing and you could have a quite a large return. That is purely protecting then and then it might never occur. If it does occur I assume it would be regulated by the States. If it does occur we think the municipalities or States should have the power to handle the problem.

Mr. ROONEY. CATV have been in business for some 16 years. If your association is so much concerned about regulating the industry with hypothetical cases it reminds me of the FCC. They are concerned about the protection of the UHF stations at the same time the Chairman of the FCC testified that the CATV industry itself never bankrupted any UHF stations in the country.

This seems to me the hypothetical situation set up today as another reason to come in and regulate an industry that has been protecting the consumer because it is a very high competitive business and they have to give the very best service for the least amount of money because there are other CATV companies around to do the same thing.

Mr. RODGERS. They would have to run the cable up the same street to do it. I think the CATV industry, so far as I know, has done a good job. As you point out there are going to be abuses by-but primarily they are in the future. One distinction between our position and the FCC is that the FCC has already taken a firm-an affirmative role in regulations. All we ask is a reservation for State regulations and let the State legislature decide what is best in the public interest for the local aspects.

Mr. ROONEY. You do want to usurp some of the authority of the FCC because you want to review the applicant, is that right? This is part of their rule?

Mr. RODGERS. As I understand it, the FCC, if they get what they want, will regulate the program aspects. But it would be up to the State to determine-assume our bill were to pass-to determine who is suitable to provide CATV service.

Then when they got the franchise for the State they would go into operations, they would automatically be subject to program regulations by the FCC.

Mr. ROONEY. Mr. Chairman, with your permission I would like to ask whether or not the statement made by the gentleman from Connecticut could become part of this record. I would like to read that. Mr. RODGERS. I will be happy to supply it.

The CHAIRMAN. Can you supply it?

Mr. RODGERS. Yes, sir; we can supply that.

The CHAIRMAN. It will be made a part of the record without objection.

(The document referred to, when supplied, will be found in the committee files.)

Mr. ROONEY. I have no further questions.
The CHAIRMAN. Mr. Murphy.
Mr. MURPHY. No questions.
The CHAIRMAN. Mr. Satterfield.
Mr. SATTERFIELD. No questions.
The CHAIRMAN. Mr. Mackay.

Mr. MACKAY. Thank you, Mr. Chairman.

I am particularly pleased to welcome Mr. Paul Rodgers, a fellow Georgian, before this committee. He is a distinguished former assistant attorney general of our State. I thank him for the statement he had just made.

Mr. RODGERS. Thank you.

Mr. MACKAY. Mr. Rodgers, if CATV is not a utility then the State utilities commissions would not have any jurisdiction over them, would they?

Mr. RODGERS. Well, then before the State of Georgia Public Service Commission could acquire any jurisdiction it would have to be given it by the Legislature of Georgia. If it was decided they would not be regulated as a utility I don't think the Georgia Commission would have any authority over them.

Mr. MACKAY. Citing the Georgia Public Service Commission as an example, it does not have any regulatory power over public utilities? Mr. RODGERS. That is right.

Mr. MACKAY. At the moment?

Mr. RODGERS. That is right, primarily.

Mr. MACKAY. Now the question of whether or not this is a public utility is in sharp contention.

Mr. RODGERS. That is right.

Mr. MACKAY. I would appreciate any brief and argument that you could submit to the committee in support of the contention that CATV is a utility.

Mr. RODGERS. Yes, sir, I will try to find something. Chairman Gibson of the Vermont commission has written a statement on that which I will be happy to obtain and place in the record.

Mr. MACKAY. I realize you are not going to be able to find much authority because of the simple fact that CATV is a new development. I talked to a lawyer in Georgia interested in this. He remarked that many novel legal questions were presented by this whole controversy. To the extent you could find this information I would like to have it. Mr. RODGERS. In our proposed language on page 6 we don't say it is a utility or it is not. It is merely just a reservation to the State legislature.

Mr. MACKAY. Do you know of any case in the country where there is now a duplication of facilities?

Mr. RODGERS. No, sir, I am not that familiar with CATV industry but I would doubt that there is any place where there is duplication of facilities.

Mr. MACKAY. Then it is a conclusion to state that it is uneconomical that there be more than one system?

Mr. RODGERS. I would think if they attempted to run two cables down the same street it would be uneconomical. The reason I did not think that there is any duplication, first, I have not heard of any,