Telecom Decision
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Ottawa, 28 September 1999
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Telecom Decision CRTC 99-13
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PART VII APPLICATION -- ACCESS TO SUPPORTING STRUCTURES OF MUNICIPAL POWER
UTILITIES --
CCTA vs MEA et al -- Final Decision
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File No.: 8690-C13-01/97
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Table of Contents Paragraph
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Summary
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Introduction 1
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The Application 3
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Issues 26
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A. The Commission's Constitutional and Statutory Jurisdiction
Under Subsection 43(5) of the Telecommunications Act 28
1. Jurisdictional Issues Raised by the Parties 28
2. Position of the CCTA and the MEA: Constitutional Jurisdiction 34
3. Position of the CCTA and the MEA: Statutory Jurisdiction 45
4. Position of Other Parties: Constitutional and Statutory Jurisdiction 77
5. Analysis and Conclusion on Jurisdiction 88
5.1 Constitutional Jurisdiction 89
5.2 Statutory Jurisdiction 107
a. Approach to Statutory Interpretation 107
b. Legislative History 111
c. Canadian Telecommunications Policy and Other Public Interest Concerns 125
d. Interpretation of "person who provides services to the public" 133
e. Need for Prior Negotiation 135
f. Interpretation of "any conditions that the Commission determines" 137
g. Interpretation of "transmission line" 140
h. Interpretation of "highway or other public place" 149
B. Procedural Fairness 165
C. The Need for Regulatory Intervention 174
D. Pole Costs and Rental Rate 181
1. Introduction 181
2. Incremental Costs 187
3. Capital Costs 196
4. Space Allocation Factor 213
E. Non-Monetary Terms of the Support Structure Agreement 227
F. Other Causal Costs Due to Cable Company Attachments on Power Utility Poles 232
G. Pole Rental Rate of the Municipal Power Utilities not Represented by the MEA 236
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Conclusion 241
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Attachment A - List of Respondents
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Summary
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Cable companies and competitive telecommunications carriers often rent space on poles
and underground conduit owned by telephone companies and power utilities to carry the
transmission lines that they use to provide service to their customers. This allows them
to provide service without installing their own poles and conduit, often called support
structures.
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In Telecom Decision CRTC 95-13 Access to
Telephone Company Support Structures, the Commission established a pole rental rate of
$9.60 per year payable by cable companies and telecommunications carriers wishing to rent
space on such poles. This rate applies to poles owned by several larger telephone
companies, including most of those that were then part of the Stentor group.
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In the application addressed in this decision, the Canadian Cable Television
Association (CCTA) requested that the Commission grant access to the poles owned by
certain power utilities in Ontario at the same rate of $9.60 per year.
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The Municipal Electric Association (MEA), an organization representing most Municipal
Public Utility Commissions and the Hydro Electric Commission of Ontario, opposed the
CCTA's application. It considered, among other things, that the Commission did not have
jurisdiction to deal with the application.
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The Commission, however, has concluded that, in the circumstances of this case, it has
the constitutional and statutory jurisdiction to deal with this matter under the
Telecommunications Act.
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The Commission considers that cable companies should pay incremental costs and make a
reasonable contribution to capital costs associated with attaching their cables to poles
owned by power utilities. Based on this principle, the Commission is establishing an
annual pole rental rate of $15.89 per pole for cable company access to hydro poles owned
by the power utilities named in this decision, until and unless the parties agree
otherwise.
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Introduction
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1.In 1996, the Municipal Electric Association (the MEA), a voluntary organization whose
members comprise the municipal Public Utilities Commissions and Hydro Electric Commissions
of Ontario (the municipal power utilities or PUCs), decided to overhaul the support
structure arrangements between municipal power utilities and certain cable television
companies in Ontario. On behalf of its members, the MEA proposed a revised support
structure agreement to include an annual pole rental rate to cable companies of over $40
per pole. The cable companies considered the MEA's proposals unacceptable. Despite
extended negotiations, the cable companies were unable to agree with the MEA on the terms
of a revised support structure agreement, including the applicable pole rental rate.
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2.The support structure agreements between the cable companies and the municipal power
utilities expired on or before 31 December 1996 and provided for an annual pole rental
rate of $10.42. Beginning in January of 1997, the municipal power utilities refused to
grant the cable companies new permits for access to their support structures.
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The Application
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3.On 13 February 1997, the Canadian Cable Television Association (the CCTA) filed an
application pursuant to Part VII of the CRTC Telecommunications Rules of Procedures (the
Rules), on behalf of Cablenet (a division of Cogeco Cable Inc.); Mr. Pierre Juneau (as
trustee for 3305911 Canada Inc. in respect of certain cable distribution undertakings that
were then to be transferred by Rogers Cablesystems Ltd.)1; Rogers Cablesystems Limited and
its subsidiaries; and Shaw Cablesystems Ltd. and its subsidiaries (the cable companies or
the Applicants). That application was brought against a number of municipal power
utilities in Ontario. The CCTA's application was brought under subsections 43(5) and 61(2)
of the Telecommunications Act (the Act). It sought both final and interim relief in order
to gain access to the support structures of those municipal power utilities.
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4.Subsection 43(5) of the Act provides as follows:
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43. (5) Where a person who provides services to the public cannot, on terms acceptable
to that person, gain access to the supporting structure of a transmission line constructed
on a highway or other public place, that person may apply to the Commission for a right of
access to the supporting structure for the purpose of providing such services and the
Commission may grant the permission subject to any conditions that the Commission
determines.
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5.The municipal power utilities that are party to this proceeding are identified in
Attachment A and are hereinafter collectively referred to as the Respondents. The MEA
acted on behalf of most (but not all) the utilities named as Respondents. Prior to 1
January 1998, the MEA represented 28 of the Respondent utilities. In its final submission,
the MEA indicated that it represented 25 of the Respondents2. The remaining Respondents
not represented by the MEA are: Canadian Niagara Power (CNP); Chatham Hydro; the Hydro
Electric Commission of the Town of Deep River (Deep River); L'Orignal Hydro Electric
Commission (L'Orignal HEC); Pelham Hydro-Electric Commission (Pelham HEC); Plantagenet
Hydro Electric Commission (Plantagenet HEC); Webbwood Hydro Electric Commission (Webbwood
HEC); Toronto Hydro-Electric Commission; and the West Elgin Hydro-Electric Commission.
Deep River and CNP each filed an answer on its own behalf.
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6.The cable companies have obtained support structure services from the municipal power
utilities for many years pursuant to successive support structure agreements. As noted
above, the support structure agreements between the cable companies and the PUCs expired
on or before 31 December 1996. In anticipation of the expiry of the agreements,
negotiations were commenced in the spring of 1996 to conclude new agreements. While the
cable companies had serious concerns about many aspects of the MEA's proposed new model
agreement, the key point of disagreement between the parties was the support structure
rate. The MEA took the position that the support structure rate should increase from
$10.42 per pole per year to $40.92 per pole per year.
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7.The cable companies objected to the MEA's proposed rate increase on the basis that
this represented an increase of approximately 300% over the existing rate and contrasted
sharply with the $9.60 rate established by the CRTC in Access to Telephone Company Support
Structures, Telecom Decision CRTC 95-13,
dated 22 June 1995 (Decision 95-13) for access to telephone company poles. The cable
companies were unable to reach an agreement with the municipal power utilities regarding
terms of access on either an interim or final basis. In addition, the cable companies
found themselves in the position of being unable to obtain support structure permits from
any of the municipal power utilities.
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8.In its application for interim relief, the CCTA requested that the Commission grant
the Applicants access to the support structures of the Respondents on an interim basis
according to the terms that applied in 1996, subject to two exceptions. First, the pole
rental rate of $10.42 per pole per year would apply on an interim basis. The CCTA
submitted that the interim rates that it proposed would be subject to adjustment
retrospectively when the Commission would set final rates. Second, the CCTA requested that
the Respondents be required to process permit applications within 30 days of receipt,
failing which a permit application would be deemed to be approved. The CCTA indicated that
an application could be denied solely on the basis of safety or technical concerns. It was
submitted that this second adjustment was required in order to ensure that the Applicants
were able to proceed with their plans in a timely manner.
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9.In its Answer, the MEA objected to the CCTA's application, for both interim and final
relief, on the basis that the Commission is without statutory and constitutional
jurisdiction to grant the relief sought, as well as on the merits of the application. The
MEA reserved the right to make additional submissions on the jurisdictional issues at a
later date and expressly did not attorn or concede to the Commission's jurisdiction in
this matter.
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10.By letter dated 27 March 1997, the Commission indicated that it was not prepared to
rule on the application for interim relief at that time and stated that it would be in the
public interest if the parties attempted to resolve their dispute with the assistance of
Commission staff. Consequently, the Commission suspended consideration of the CCTA's
application, while the parties took part in an informal and non-binding dispute resolution
process designed to facilitate and encourage the parties to arrive at their own mutually
acceptable settlement with the assistance of Commission staff. Commission staff would
issue a non-binding opinion on matters that were unresolved after the meeting with the
parties. This non-binding opinion would provide the parties the opportunity to review the
relative merits of their case and encourage more realistic settlement negotiations before
resorting to a formal determination by the Commission. If a party considered that any
matter still remained unresolved two weeks after the staff opinion had been provided to
the parties, any party could file a request that the Commission re-initiate the process to
determine, on an interim and final basis, any of the issues that were not satisfactorily
resolved. The Commission also noted that the parties would be provided with an opportunity
to comment on staff's opinion and make further submissions, including submissions
regarding the issues of constitutional and statutory authority. It was also stated that
the staff opinion, all material filed by the parties prior to the release of the opinion
and any subsequent submissions filed would form part of the record of the proceeding upon
which the Commission's decision would be based.
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11.The parties met with Commission staff on 23 April 1997. At that meeting, it was
apparent that the principal issue in dispute between the parties related to the
appropriate costing methodology and associated pole rental rate. The methodology proposed
by the Respondents resulted in a proposed pole rental rate of $40.92 per pole per annum.
As noted above, the most recent agreements that expired on or before 31 December 1996, had
provided for a pole rental rate of $10.42 per pole per annum. At the conclusion of the
meeting, the parties acknowledged that there was little likelihood of resolving at the
meeting, the principal dispute relating to the appropriate costing methodology and
associated pole rental rate. As a result, the meeting was adjourned and discussion of the
other issues raised by the parties was reserved pending release of a non-binding opinion
by Commission staff solely on the issue of the appropriate methodology and pole rental
rate.
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12.On 13 May 1997, Commission staff issued a non-binding opinion suggesting that the
parties adopt an annual support structure rate of $13.40 per pole. In an attempt to build
on the discussion which took place during the Commission's dispute resolution process, the
parties met throughout June and July, but were unable to resolve their disagreements. On 8
August 1997, the CCTA wrote to the Commission requesting that its application for interim
and final relief be re-initiated.
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13.By letter dated 8 September 1997, the Commission resumed the process. With respect
to the interim relief, the Applicants and Respondents were given the opportunity to file
evidence and any additional submissions, including submissions regarding the non-binding
staff opinion and the issues of constitutional and statutory authority. Other interested
parties were also given the opportunity to file comments.
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14.On 1 October 1997, the MEA served on the Attorneys-General of Canada and the
provinces a Notice of Constitutional Question pursuant to the Federal Court Act. However,
none of the Attorneys-General filed submissions.
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15.In the course of this proceeding, the Commission received comments relating to the
jurisdictional issues from the CCTA, the MEA and CNP as well as from Saskatchewan Power
Corporation, TransAlta, UMG Cable Telecommunications Inc. (UMG), Ontario Hydro, Telus
Corporation (Telus) and Stentor Resource Centre Inc. (Stentor) on behalf of BC TEL, Bell
Canada and MTS NetCom Inc., as interested parties.
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16.On 7 November 1997, following two rounds of submissions by the parties, the
Commission denied the request for interim relief on the basis that the Applicants had not
met one of the criteria for granting interim relief.3 Having come to the conclusion that
interim relief should be denied, the Commission did not need to address, at that time, the
other arguments raised by the parties, including the issue of its constitutional and
statutory jurisdiction.
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17.In accordance with the Commission's Revised Directions on Procedure issued 23
September 1997, the Commission received responses to interrogatories and final and reply
comments on behalf of the parties in respect of the application for final relief. The
record closed 17 February 1998.
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18.It is to be noted that the Commission has had before it a second and similar
application filed by UMG on 25 February 1997 pursuant to Part VII of the Rules. In its
application, UMG sought interim relief pursuant to subsections 42(1), 43(5), 55 and 61 of
the Act and named Ontario Hydro as Respondent. In a decision dated 27 March 1997, the
Commission granted UMG interim relief and made preliminary findings on jurisdictional
issues.
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19.On 24 April 1997, Ontario Hydro filed with the Federal Court of Appeal a Motion for
Leave to Appeal as well as an Originating Notice of Motion for judicial review of the
Commission's decision. In both of these applications, Ontario Hydro submitted, amongst
other issues, that the Commission had erred in finding that it had the statutory and
constitutional jurisdiction to grant UMG interim relief. On 29 May 1998, the Federal Court
of Appeal issued its decisions denying Ontario Hydro's application for leave to appeal and
quashing the application for judicial review.
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20.The Federal Court of Appeal's decisions denying leave to appeal and quashing the
motion for judicial review of the Commission's decision in the UMG v. Ontario Hydro matter
were issued after the close of the proceeding for final relief in the instant case.
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21.In a letter dated 3 June 1998, the CCTA requested that the Commission render a
decision in respect of its application for final relief given that it had become obvious
that the parties were not able to settle this matter on their own and "given that any
doubt regarding the CRTC's jurisdiction over access disputes has been dispelled by the
Federal Court of Appeal's recent decision". In particular, the CCTA maintained that
the Federal Court of Appeal had "upheld the CRTC's jurisdiction under the
Telecommunications Act to resolve disputes between cable companies and power utilities
over access to power utility poles".
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22.In a letter dated 4 June 1998, the MEA took exception to the CCTA's position on
several grounds. In particular, the MEA noted that the Court dismissed Ontario Hydro's
application for leave to appeal without providing any reasons for its decision. In
addition, the MEA argued that the Court's decision does not form a binding precedent and
is not a ruling on the validity of the constitutional and statutory arguments made to the
Commission. The MEA noted that some of the submissions made by the MEA in the instant case
differ significantly from those advanced to the Court by Ontario Hydro and the leave
sought there was to appeal an interim order, not a final order.
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23.The MEA also submitted that the CCTA's letter of 3 June 1998 presents further legal
submissions after the close of the proceedings, is consequently a breach of procedural
fairness, and should not be considered.
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24.The Commission has determined that the aforementioned letters should be considered
part of the record of the proceeding. The Court's decisions represent a change in
circumstances which occurred after the close of the record of this proceeding and which
the parties could not have addressed previously. The Commission considers that the
allegation of procedural unfairness raised by the MEA is without merit since the MEA has
had the opportunity to, and did, fully respond to the CCTA's position.
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25.The Commission acknowledges that the Federal Court's decisions relating to the UMG
v. Ontario Hydro interim decision do not represent a binding precedent on the
jurisdictional issues raised in the present application. Accordingly, the Commission has
made its final determination in the present case based on its own merits, giving due
consideration to all arguments raised by the parties to this proceeding, including the
jurisdictional arguments similar to those raised in the UMG v. Ontario Hydro matter.
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Issues
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26.In its application, the CCTA asked the Commission to grant the cable companies
access, on a final basis, to the municipal power utilities' support structures on the same
terms and conditions as applied in 1996, with the exception that the annual pole rental
rate be set at $9.60 per pole per year.
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27.The main issues raised in the submissions relating to the application for final
relief are as follows:
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(a) the Commission's constitutional and statutory jurisdiction under subsection 43(5)
of the Act;
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(b) an alleged breach of procedural fairness;
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(c) the need for regulatory intervention;
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(d) the appropriate pole costs and pole rental rate;
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(e) the non-monetary terms of the support structure agreement;
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(f) other causal costs due to cable company attachments on utility poles; and
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(g) the pole rental rate for the PUCs not represented by the MEA.
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A.The Commission's Constitutional and Statutory Jurisdiction under Subsection 43(5) of
the Telecommunications Act
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1.Jurisdictional Issues Raised by the Parties
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28.The Commission notes that the MEA has, throughout this process, consistently
maintained that the Commission is without statutory and constitutional jurisdiction to
grant the relief requested. The CCTA has also maintained its position that the Commission
has jurisdiction to grant the relief requested.
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29.In its final submissions, the MEA reiterated its position, and repeated and relied
on its submissions at the interim stage. In its reply submissions on final relief, the MEA
raised further jurisdictional arguments including submissions with respect to the
interpretation of the expression "other public place", in subsection 43(5) of
the Act, and the related issue of support structures located on private land.
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30.The MEA's submissions focused upon the following two jurisdictional issues:
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(i)The Commission's statutory jurisdiction pursuant to subsection 43(5) of the Act to
make the Orders requested by the CCTA; and
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(ii)Parliament's constitutional jurisdiction to adopt and the Commission's
constitutional jurisdiction to apply subsection 43(5) in the manner requested by the CCTA.
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31.In addition, the MEA submitted that the Commission's decision in the UMG v. Ontario
Hydro matter dated 27 March 1997, which involved similar questions as arise in the MEA's
case, although the factual foundation is different, was incorrect. The MEA further noted
that the Commission's decision in the UMG v. Ontario Hydro case was a
"preliminary" decision and that the Commission made clear that it was making
that decision on the basis that it could, after a full argument by the parties, arrive at
a different conclusion concerning jurisdiction. In the MEA's view, this was an appropriate
qualification as extensive submissions and constitutional facts were not available to the
Commission at that time.
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32.In its final submissions, the CCTA relied on its interim submissions and on the
reasons given in the Commission's decision in the UMG v. Ontario Hydro matter, and made
additional arguments including submissions relating to the interpretation of "other
public place".
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33.Both CNP and Deep River objected to the Commission intervening in this matter. CNP
argued that subsection 43(5) did not apply because the poles are not public assets, many
of the poles are located on property owned by CNP and the allegation that the cable
companies cannot obtain access to support structures on terms acceptable to them was
wholly subjective and one-sided. Deep River submitted that the Commission should ensure
that further negotiations continue, resorting to mediation if necessary.
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2.Position of the CCTA and the MEA: Constitutional Jurisdiction
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34.The MEA submitted that subsection 43(5) is outside the constitutional jurisdiction
of the federal Parliament and is properly a matter for the provincial legislatures.
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35.In this regard, the MEA raised the following arguments:
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(a) municipal power utilities are creatures of provincial statute and are responsible
to their local municipalities;
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(b) the MEA's members are intensely and exhaustively regulated by Ontario Hydro;
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(c) a complex legislative scheme applies to the activities of Ontario's municipal power
utilities;
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(d) many Canadian provinces have established regulatory schemes for the regulation of
power utility pole attachments;
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(e) numerous factors contribute to the decisions and standards applicable to power
utility pole attachments;
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(f) Electricity is dangerous and pole attachment activities must remain within the
power of the MEA's members in order to ensure the safety of the workers and the public,
and the technical reliability of the power distribution system; and
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(g) The municipal power utilities and the cable television industry have a
long-standing relationship and a history of negotiated agreements.
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36.In addition, the MEA argued that circumstances have changed since the Supreme Court
decided in the late 1970s that because cable companies were single indivisible
undertakings, all of the functions of the cable companies, including the system for the
distribution of signals, fell under federal jurisdiction. The MEA submitted that the
Supreme Court's original decision requires review.
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37.The MEA noted that cable companies have been found by the Commission to have a dual
nature, to be both broadcasting and telecommunications undertakings. Furthermore, the MEA
noted that, while there was some sense in finding that the entire undertaking was
connected and indivisible in the past, cable companies now no longer have to own their
distribution facilities. In other words, while the reception of signals may still be
essential to the cable company, a cable company may lease the entire distribution network
such that the network may be entirely within a single province's boundaries. In this
regard, the MEA noted that a similar division occurred in the case of Ontario Hydro where
the Supreme Court of Canada found that Ontario Hydro's nuclear facilities fell within
federal jurisdiction but the system for the distribution of power and conventional power
generating facilities were provincial in nature.
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38.The MEA further argued that subsection 43(5) does not have any connection to federal
jurisdiction. There is no mention of any federal undertaking or any work or object of a
federal nature, unlike the rest of sections 42 and 43 which mention "Canadian
carriers" and "distribution undertakings". While the MEA submitted that a
provision may be subsumed within federal jurisdiction when it is closely connected to a
federal statutory scheme, it argued that this close connection is subject to attack.
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39.The MEA submitted that the Supreme Court of Canada's test in General Motors v. City
National Leasing4, stands for the principle that a very close connection must exist
between the provision and the Act as a whole where provincial powers are heavily affected
by federal legislation as in the case of subsection 43(5). In this regard, the MEA
submitted that subsection 43(5) is easily severable from the rest of the scheme. There is
no evidence that cable companies would not be able to operate without subsection 43(5).
Moreover, subsection 43(5) can be read down so that it does not apply to provincial power
utilities.
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40.The MEA noted that an elaborate and complex series of provincial statutes and
regulations govern all of the activities of the PUCs in Ontario and ties them to
municipalities. While the PUCs are responsible for control and management of the
utilities, the municipalities, pursuant to the Municipal Act, and Ontario Hydro play a
role in the control of the property and finances of the PUCs. In the MEA's view, anything
that affects PUCs affects this provincial legislative scheme. The access and conditions
requested by the CCTA to the power utility poles would affect their core activities.
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41.The MEA submitted that the distribution of power, due to the danger involved, does
not leave a wide margin for error. The Commission's involvement in the power industry is
not only about price but also about conditions of access. In the MEA's view, there is an
elaborate provincial scheme to ensure that electricity flows to consumers safely,
effectively and efficiently and this system must be preserved even if as a result some
inconvenience is incurred by cable companies.
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42.In response, the CCTA noted that while the Commission has found that cable companies
may have a dual nature, as they may act as both broadcasting undertakings and
telecommunications common carriers, cable companies are subject to federal jurisdiction
under both aspects of their dual nature.
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43.The CCTA argued that there is no doubt that Parliament has the constitutional
authority to affect property rights in connection with the regulation of Canadian carriers
and distribution undertakings. In this regard, the CCTA noted that section 43 establishes
a complete legislative regime to enable Canadian carriers and distribution undertakings to
construct, operate and maintain their transmission lines. Subsections 43(2) to 43(4) deal
with situations where it is necessary to construct support structures for transmission
lines while subsection 43(5) deals with support structures that already exist. All of
these provisions are within the legislative competence of Parliament.
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44.The CCTA argued that the analytical approach set out in the test advanced by the MEA
as applied in General Motors v. City National Leasing has no application to
telecommunications. The CCTA submitted that even if the test is relevant, subsection 43(5)
is an integral element in the general legislative scheme under section 43 for the
construction of transmission lines by Canadian carriers and distribution undertakings and
ensures that support structures are shared whenever possible, thereby avoiding needless
expense and public inconvenience. In the CCTA's view, it is not only reasonable for the
Commission to have jurisdiction in the present situation, it is necessary.
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3.Position of the CCTA and the MEA: Statutory Jurisdiction
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45.The MEA submitted that subsection 43(5) displays multiple ambiguities and its
ordinary meaning is unclear. In particular, the MEA submitted that words and phrases such
as "person", "supporting structure of a transmission line",
"other public place" and "conditions" are ambiguous. In the MEA's
view, these ambiguities require going beyond their ordinary meaning.
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46.The MEA submitted that, because subsection 43(5) is unclear, it is important to
examine Parliament's intention when it drafted the provision. The MEA argued that, while
the Commission chose the dictionary approach in the UMG v. Ontario Hydro decision, it
should have examined the statutory context of the provision. In this regard, the MEA
submitted that the two elements of statutory context are the immediate context of the word
or phrase as well as the use elsewhere in the statute of the particular terms considered
ambiguous.
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47.The CCTA argued that the Commission did not err in relying on the ordinary meaning
of subsection 43(5) in the UMG v. Ontario Hydro decision. The CCTA noted that the
Commission also considered and adopted the statutory context, which supports the
interpretation advocated by the CCTA in the present proceeding. In the CCTA's view, the
purposive interpretation of subsection 43(5) would support an expansive interpretation in
view of the obvious purpose of this section which is to promote the sharing and efficient
use of support structures. The CCTA noted that in the UMG v. Ontario Hydro decision, the
Commission describes the legislative history of subsection 43(5) and from this
description, it is clear that subsection 43(5) represents an integral element in a
coherent legislative scheme to address support structure issues and an attempt to
accommodate provincial concerns regarding the possible proliferation of support
structures.
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48.The MEA argued that, based on section 4 of the Act, the "person" who
provides a public service cannot be a distribution undertaking because subsection 43(5)
does not explicitly include distribution undertakings. The MEA noted that Parliament
referred to "Canadian carriers" and "distribution undertakings" in
other related provisions of sections 42 and 43 but switched to dealing with
"person" in subsection 43(5). Furthermore, the MEA submitted that the word
"person" was ambiguous in view of the use of the word "fournisseur" in
the French version, rather than a term equivalent to "person". The MEA argued
that if one applies the purposive approach in interpreting the Act, subsection 43(5)
should properly be interpreted to allow non-broadcasting entities to gain access to the
poles that Canadian carriers and distribution undertakings were given the power to
construct under sections 42 and 43. Subsection 43(5) was not meant to allow the Commission
to make orders against organizations outside the federal sphere of influence.
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49.The CCTA submitted that the MEA's interpretation of the word "person"
lacks both merit and relevance. In the CCTA's view, there is no dissonance or incongruity
between the French and English phrases. Both refer in general terms to a supplier of
services to the public. It is clear that a cable company qualifies as a "person who
provides services to the public" or as "le fournisseur de services au
public".
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50.The MEA argued that the UMG v. Ontario Hydro decision was incorrect in finding that
the absence of qualification of the term "transmission line" in subsection 43(5)
indicated Parliament's intent to include a more general type of transmission line. The MEA
submitted that the terms "transmission line" and "supporting
structures", when examined in the context of the statute itself, should be
interpreted as telecommunications transmission lines and supporting structures. In the
MEA's view, power utility poles themselves are outside the Commission's statutory
jurisdiction.
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51.The MEA submitted that because other subsections of the Act specifically refer to
"transmission line" as being qualified in the context of telecommunications
carriers or distribution undertakings, the use of the phrase "transmission line"
in subsection 43(5) similarly must refer to a telephone line or a cable distribution wire
rather than a power line. In the MEA's view, such an interpretation retains the consistent
meaning of the phrase "transmission line" throughout the statute. Furthermore,
the MEA submitted that the similarity between the terms "transmission facility"
and "transmission line" would indicate that the transmissions with which the Act
is concerned involve intelligence or data and not electrical power. In addition, the MEA
submitted that the Commission's reliance, in the UMG v. Ontario Hydro decision, on
Parliament's use of the term "telecommunications line" in the definition of
"international submarine cable" as an indication of the scope of
"transmission line" in subsection 43(5), was flawed. In the MEA's view, the use
of "telecommunications line" was an attempt by Parliament to emphasize the
transmission and receiving elements of such a line, as opposed to merely defining it as a
transmission line. Thus, there was a reason why Parliament used the term
"telecommunications line" in the submarine cable context and this reason has no
bearing on subsection 43(5).
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52.The MEA further submitted that the phrase "supporting structure of a
transmission line" should be interpreted in the context in which it appears such that
not only should "transmission line" be interpreted as a telecommunications
transmission line, but "supporting structures" should be limited to
telecommunications supporting structures. Thus, it is irrelevant whether cable
distribution wires are already attached to some power utility poles; the power utility
poles themselves are outside the Commission's jurisdiction because they are not
telecommunications "supporting structures".
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53.The MEA noted that subsection 43(5) was added after Second Reading of Bill C-62
without any real parliamentary discussion. Neither subsection 43(5) nor any provision
similar to it appeared in the Railway Act, the predecessor to the Telecommunications Act,
or in related telecommunications legislation. In the MEA's view, it is not clear on the
record why the provision was added or what mischief it was meant to remedy. Whatever the
purpose, Parliament could not have intended that "transmission line" include
wire transmitting raw electrical power wholly within a province or that "supporting
structure" include power utility poles.
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54.The CCTA argued that the alleged ambiguities raised by the MEA are nothing more than
attempts to obscure the plain meaning of a simply worded provision. In the CCTA's view,
there is no ambiguity in the use of the term "transmission line" and the phrase
"supporting structure", and both are sufficiently broad to include power utility
lines and poles.
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55.The CCTA argued that the use of the more general term "transmission line"
in subsection 43(5), without the qualitative adjective "telecommunications" or
qualifying terms such as "of a Canadian carrier" found elsewhere in the Act,
indicates that Parliament wished the term to be given its ordinary, broad meaning. If
Parliament had intended to refer to a line solely for the purpose of emitting,
transmitting or receiving intelligence in subsection 43(5), Parliament would have used the
term "telecommunications line", as it did in the definition of
"international submarine cable".
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56.The CCTA submitted that the MEA's argument to the effect that "supporting
structures" must be read as "telecommunications supporting structures"
because power utility poles are outside the Commission's jurisdiction is circular and has
no merit. In the CCTA's view, the ordinary meaning of "supporting structure of a
transmission line" includes a power utility pole.
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57.The MEA submitted that the phrases "highway" and "other public
place" provide each other with context. In the MEA's view, Parliament intended that
the type of "public place" in question share the same type of public access as
that of a "highway" and, therefore, a right-of-way would not be the type of
"other public place" contemplated by Parliament.
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58.The MEA further submitted that, in law, a right-of-way over private land held by a
municipal power utility does not confer a public right of access and is not the type of
"other public place" contemplated by Parliament. In the MEA's view, the phrase
"other public place" cannot be reasonably interpreted to include private land.
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59.The MEA noted that many power utility poles are located on private land. The
proportion of power utility poles on private land is specific to each PUC and varies
tremendously. A portion of these power utility poles are located on easements granted to a
PUC while others are in place pursuant to an agreement between land owners and PUCs. In
its view, the application of subsection 43(5) to private places would constitute a form of
illegal expropriation.
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60.The CCTA submitted that, contrary to the narrow interpretation advanced by the MEA,
the term "other public place" must be read in the context of subsection 43(5)
and not merely in relation to the term "highway". The purpose of subsection
43(5) is to promote the sharing and efficient use of existing support structures. Given
this purpose and given that Parliament is presumed to have been aware of the location of
support structures on public utility rights-of-way, it would be entirely inappropriate to
read "other public place" as being a location which must have the same type of
public access as a "highway" as suggested by the MEA.
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61.In the CCTA's view, subsection 43(5) must be given its plain meaning and interpreted
as applying to support structures owned by power utilities. The CCTA submitted that if
this interpretation were not adopted, there would be a significant and unjustifiable gap
in the scheme established under section 43. In support of this argument, the CCTA noted,
for example, that almost all poles (approximately 95%) in Alberta are owned by power
utilities. In Newfoundland, power utility poles are interspersed with poles owned by the
telephone company, NewTel Communications Inc., making it futile to grant access to the
NewTel poles alone.
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62.The CCTA submitted that, in the context of subsection 43(5), the phrase "other
public place" must be taken to include public utility rights-of-way and easements. In
the CCTA's view, Parliament must be presumed to know that a certain percentage of support
structures owned by either power utilities or telephone companies are located on public
utility rights-of-way in many provinces. The CCTA further submitted that it would make no
sense for Parliament to establish a regulatory regime which would require a cable company
to construct a new line of support structures on a highway when support structures with
spare capacity already exist on a nearby public utility right-of-way. Under such a
scenario, the Commission could grant relief in respect of the majority of the support
structures but not with respect to the exceptional few. Parliament could not have intended
such a haphazard access regime.
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63.The CCTA further submitted that if poles on public rights-of way or easements were
not included, then attachments to such poles could be subject to excessive rates and other
unreasonable terms of access and could have the effect of counterbalancing the overall
effect of reasonable rates and terms imposed by the Commission, contrary to Parliament's
intention.
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64.The CCTA also argued that a public utility right-of-way cannot be dedicated as
private property in the usual sense. It is land dedicated to a public purpose; namely, the
placement of public utility facilities to permit the delivery of utility services for the
benefit of the public. The public purpose remains the same whether the right-of-way is
statutory or consensual. Support structures located on a public utility right-of-way may
be used for more than one public purpose and this does not alter the public nature of such
a right-of-way. In the CCTA's view, the public purpose of a public utility right-of way
renders it a "public place" for the purpose of subsection 43(5) and is
consistent with the purposive interpretation of the phrase.
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65.The CCTA submitted that according to the evidence of the MEA, 92% of the support
structures which are subject to the agreements between the power utilities and the cable
companies are located on the road allowance of highways and streets. The remaining 8% of
the MEA's members' support structures are situated on property that is subject to a
statutory or consensual public utility easement or right-of-way.
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66.In its response to the CCTA's final submissions, the MEA focused upon the
proposition that subsection 43(5) only applies to public places and not to private land.
In this regard, the MEA confirmed that 92% of joint use power utility poles of 18 of the
Respondents are located on the road allowances of public streets and highways.
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67.The MEA submitted that the CCTA's assumption that the remaining power utility poles
are set on property "which is subject to a statutory or consensual public utility
right-of-way or easement is unjustifiable and without evidentiary foundation". In
particular, the MEA indicated that "some power utility poles are located on public
property, but in many cases, power utility poles are located on private land without the
benefit of a right-of-way or easement. In some cases specific landowners have allowed
power utility poles to be located on their land without granting a right-of-way". In
the MEA's view, the CCTA has attempted to gloss over the property ownership issues
implicit in its proposed interpretation of subsection 43(5) of the Act.
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68.In the MEA's view, allowing a government agency to order the use of private land for
a public purpose is a form of expropriation. The MEA submitted that such expropriation by
the Commission is allowed, pursuant to section 42, in very limited circumstances and that,
in order for subsection 43(5) to be applicable to private land, federal authorities must
officially expropriate the land and make it a "public" place. This, in the MEA's
view, would entail fair compensation. In addition, the MEA submitted that the entire
scheme of section 43 only allows the Commission to make orders concerning public land and
that Parliament has specifically avoided granting the Commission expropriation powers in
situations to which section 43 applies.
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69.The MEA argued that public places have been defined in other contexts as places the
public may go or where an invitation has been tendered for the public to enter on the
land. In the MEA's view, private land occupied by power utility poles does not imply that
the public has been invited to enter the land. In addition, the MEA added that a
municipality is a corporate entity that is not the public and therefore, land occupied in
part by municipal electric power utilities that are owned by private land owners remains
private because the right-of-way does not allow other people to enter the land.
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70.In addition, the MEA argued that the appropriate extent to which the parties are
required to negotiate in good faith before approaching the Commission for an order is
unclear.
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71.The CCTA submitted that the MEA's argument relating to the degree of negotiation
between the parties before approaching the Commission is both irrelevant and without
merit. In this regard, the CCTA stated that there is no doubt that there were extensive
negotiations on the access issue.
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72.The MEA stated that it is unclear to what extent the "conditions" that the
Commission would impose can cover elements of an agreement that usually would be freely
negotiated between the parties. In addition, the MEA submits that it is unclear whether
these "conditions" can have an impact on industries, such as the electrical
power industry, that fall outside the Commission's purview.
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73.The CCTA submitted that the phrase "any conditions" is unambiguous and
must of course relate to access to support structures. The CCTA indicated that this phrase
clearly encompasses the terms of a support structure agreement which is within the
Commission's expertise. The CCTA noted that it has not requested any conditions that could
be construed otherwise.
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74.The MEA further submitted that there is a presumption in law that Parliament's
intention with regard to a particular provision is to avoid absurd results. It is absurd
to suggest that Parliament intended that the Commission "regulate" power
utilities or have the power to write the entire contract for cable companies to make use
of power utility poles. The MEA added that the Commission does not have the expertise to
administer all of the safety and technical standards involved in the distribution of
power. Moreover, if a broad interpretation is taken of subsection 43(5), the MEA submitted
that the Commission could end up regulating the access of an advertiser
("person") stringing signs near roadways to poles that support pneumatic tubes
between government offices ("support structures" of a "transmission
line").
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75.In the CCTA's view, there is nothing absurd about the Commission having jurisdiction
over the terms of access to power utility poles. Such jurisdiction does not amount to
administering all of the safety and technical standards involved in the distribution of
power, as advanced by the MEA. The CCTA acknowledges that safety and technical standards
already exist and would need to be taken into account.
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76.Furthermore, the CCTA submitted that the present application is not one where the
Commission is faced with a choice between public safety and cable television service. The
CCTA noted that the Applicants have asked the Commission to grant them permission to have
access to the support structures of the Respondents on terms based on the agreement that
was in place for a number of years prior to 1997.
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4.Position of Other Parties: Constitutional and Statutory Jurisdiction
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77.As noted above, in addition to the comments and reply comments received from the
CCTA and the MEA, the Commission has received comments relating to the jurisdictional
questions from CNP, Saskatchewan Power Corporation, TransAlta, UMG, Ontario Hydro, Telus
and Stentor on behalf of BC TEL, Bell Canada and MTS NetCom Inc., as interested parties.
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78.Both Saskatchewan Power Corporation and TransAlta filed, at the interim stage, brief
comments supporting the position of the MEA. Although their comments were filed late, the
Commission determined that they should be accepted as part of the interim relief record.
While both parties reserved the right to participate more extensively on final relief,
there were no submissions received at the final stage.
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79.UMG took the position that the Parliament of Canada enjoys the necessary
jurisdiction to enact both subsections 42(1) and 43(5) of the Act and that on correct
reading, both apply to allow the Commission to impose the relief sought. Ontario Hydro
submitted that the relief should be denied because the Commission would be without
statutory and constitutional jurisdiction. Ontario Hydro maintained that the intent of
subsection 43(5) is, clearly, to provide a remedy for a person that provides a public
service which cannot gain access to the distribution facilities of a telecommunication
company within the jurisdiction of the Commission. Ontario Hydro submitted that even if
the federal government did have jurisdiction to enact legislation relating to a provincial
electrical distribution system, subsection 43(5) of the Act does not give the Commission
such jurisdiction.
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80.Stentor submitted that Parliament has the constitutional authority to legislate with
respect to access by Canadian carriers and distribution undertakings to support structures
owned or operated by provincially regulated utilities. Stentor submitted, as well, that
subsection 43(5) applies to situations in which a Canadian carrier or a distribution
undertaking cannot gain access on terms acceptable to it, to support structures located on
a highway or other public place owned or operated by provincially regulated public
utilities.
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81.Stentor suggested that the term "transmission line" in subsection 43(5)
should be interpreted to mean a telecommunications transmission line. This interpretation
would be internally consistent with the entirety of section 43. Canadian carriers and
distribution undertakings construct telecommunications transmission lines, not electrical
transmission lines. Accordingly, a fair interpretation of subsection 43(5) is that if a
support structure of an electrical utility is constructed on a highway or other public
place, a person who provides services to the public (i.e., a federally regulated Canadian
carrier or distribution undertaking or other public utility) requiring access to such a
structure to support a telecommunications transmission line may apply to the Commission
for access if such a person cannot gain access on acceptable terms.
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82.Stentor submitted that subsection 43(5) is, in pith and substance, legislation
"in relation to" federal works and undertakings and telecommunications, and that
it may validly affect issues of property and civil rights within a province. In this
regard, Stentor noted that subsection 43(3) and its predecessors have long done so with
respect to municipalities and submits that there is a clear and rational connection
between a valid purpose of the Act and the need for access to support structures.
Accordingly, Stentor submitted that subsection 43(5) of the Act is valid federal
legislation, notwithstanding its incidental effect on property and civil rights within a
province.
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83.Stentor added that while it is clear that the Commission has jurisdiction to address
disputes regarding access to support structures, it would be inappropriate to conclude
that the Commission should regulate the provision of access to support structures owned or
operated by the municipal utilities on an ongoing basis. In Stentor's view, subsection
43(5) was intended to provide the Commission the ability to resolve disputes on a case by
case basis, as the National Transportation Agency and its predecessor agencies had done
under provisions analogous to subsection 43(4) in the Railway Act and prior to the coming
into force of section 104 of the Telecommunications Act.
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84.Telus submitted that the term "transmission line" in subsection 43(5) was
intended to mean a telecommunications transmission line. Hence, in its view, any
supporting structure which carries a telecommunications transmission line falls within the
Commission's jurisdiction under subsection 43(5). The broad language used in that
subsection indicates that it is intended to deal with supporting structures upon which
telecommunications lines are carried irrespective of the ownership of the supporting
structures.
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85.Telus also noted that the Commission is guided by the objectives enshrined in
section 7 of the Act, including: to facilitate the orderly development throughout Canada
of a telecommunications system that serves to safeguard, enrich and strengthen the social
and economic fabric of Canada and its regions, to render reliable and affordable
telecommunication services of high quality accessible to Canadians in both urban and rural
areas in all regions of Canada; and, to enhance the efficiency and competitiveness, at the
national and international levels, of Canadian telecommunications. In Telus' view, the
adoption of a restrictive interpretation of subsection 43(5) where only supporting
structures owned by Canadian carriers would be subject to the Commission's jurisdiction
would be contrary to the broad language of the provision and would deprive the Commission
of the means to fulfil the very objectives of the Act.
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86.Telus indicated that there are no cases5 applying the doctrine of
interjurisdictional immunity to federal laws in order to protect provincially incorporated
companies or provincially regulated undertakings from the extension of federal laws to the
status or essential powers of these undertakings. Telus submitted, however, that it is
difficult to see how subsection 43(5) of the Act would be regarded as affecting the status
or essential powers of the provincially regulated power utilities. In Telus' view, the
constitutional analysis ought to focus on whether the Act may have an incidental or
ancillary effect on a provincial undertaking.
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87.Telus submitted that the Act is clearly legislation in relation to a matter of
federal competence and that, if subsection 43(5) is valid federal legislation that is in
"pith and substance" a law that is in relation to a matter within the competence
of Parliament, it may validly have an incidental effect upon property and civil rights
within a province. On fair reading, subsection 43(5) would only affect provincial poles
that have already been used to carry transmission lines. The right that is granted is
merely access, not an easement, and presumably does not interfere with the operation of
the power poles. This, in Telus' view, amounts to a very minor encroachment. Accordingly,
the test for determining how necessary the impugned provision is to the otherwise valid
legislative scheme involves determining whether there is a rational, functional connection
between subsection 43(5) and the valid part of the Act, which is the regulation of
telecommunications and the deployment of transmission lines.6 In this regard, Telus
submitted that access to supporting structures already carrying transmission lines is
rationally and functionally connected with the regulation of telecommunications and
concluded that subsection 43(5) is valid federal legislation notwithstanding its
incidental effect upon property and civil rights within a province.
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5.Analysis and Conclusion on Jurisdiction
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88.The Commission has carefully considered the submissions made by the parties with
regard to its constitutional and statutory jurisdiction. Although the facts giving rise to
this application differ from those in the UMG v. Ontario Hydro matter, many of the
jurisdictional arguments raised in this proceeding are similar to those raised there. Upon
further consideration of these arguments in this proceeding, the Commission has, to some
extent, made a final determination that is identical to the preliminary findings outlined
in the UMG v. Ontario Hydro interim decision. The Commission's determination on its
statutory and constitutional jurisdiction is set out below.
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5.1 Constitutional Jurisdiction
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89.Pursuant to subsection 52(1) of the Act, the Commission may, in exercising its
powers and performing its duties under the Act, determine any question of law. In light of
the applicable case law, such an express power enables the Commission to examine and rule
upon the constitutional validity of a statute that it is called upon to apply.7 If the
Commission considers that a provision is constitutionally invalid, it can treat the
statutory provision as having no force and effect.
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90.In order to properly assess the validity of subsection 43(5), it is necessary to
first proceed to the determination of the content or subject matter of the law in order to
properly characterize the "pith and substance" of the provision and assess
whether it is in relation to a matter within federal jurisdiction. The characterization of
the law involves not only considering the legal effect of the provision but also inquiring
into the purpose the statute was enacted to achieve.8
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91.Pursuant to section 47 of the Act, the Commission must exercise its powers and
perform its duties under the Act and any special Act with a view to implementing the
Canadian telecommunications policy objectives outlined in section 7 of the Act. The
Commission considers that there is a direct relationship between the policy objectives and
the underlying purpose subsection 43(5) is designed to achieve. In particular, the
Commission notes that, pursuant to section 7, it is to exercise its powers under the Act
with a view to implementing, amongst others, the following objectives: to facilitate the
orderly development throughout Canada of a telecommunications system that serves to
safeguard, enrich and strengthen the social and economic fabric of Canada; to render
reliable and affordable telecommunications services of high quality accessible to
Canadians in both urban and rural areas in all regions of Canada; to enhance efficiency
and competitiveness, at the national and international levels, of Canadian
telecommunications; and, to respond to the economic and social requirements of users of
telecommunications services.
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92.The Commission is of the view that subsection 43(5) of the Act is a validly enacted
provision within the legislative authority of the Parliament of Canada. It provides a
statutory remedy to distribution undertakings, Canadian carriers and other persons who
provide services to the public. It applies in circumstances where those undertakings have
been unable to negotiate terms and conditions, acceptable to them, which would allow them
to gain access to supporting structures located on a highway or other public place in
order to install or maintain new and existing plant. The Commission considers that
subsection 43(5) of the Act is properly characterized as being designed to encourage joint
use of existing supporting structures in order to facilitate the efficient deployment of
the distribution plant of cable distribution undertakings, Canadian carriers and other
persons who provide services to the public. The Commission considers that this provision
applies when the applicant or, the respondent or both are federal undertakings
contemplated by either the Telecommunications Act or the Broadcasting Act.
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93.The Commission considers that section 43 provides a comprehensive legislative scheme
in that it contemplates not only the construction of transmission lines but also access to
existing supporting structures. It is of the view that the inability of Parliament to put
into place a comprehensive legislative scheme in order to allow for the orderly deployment
of distribution networks and the efficient joint use of existing support structures
located on a public place, by either a cable distribution undertaking or a Canadian
carrier, would affect a vital and essential part of the management, location, design and
operation of those federal undertakings. Subsection 43(5) ensures that support structures
are shared whenever possible, thereby avoiding unnecessary expense and public
inconvenience.
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94.The Commission has determined that subsection 43(5) of the Act is, in pith and
substance, legislation in relation to a matter of federal competence, namely federal works
and undertakings. Parliament's exclusive jurisdiction over broadcasting (including cable
distribution) has been clearly established by the courts.9 Pursuant to those authorities,
a cable distribution system is part of an indivisible communications undertaking within
the legislative competence of Parliament. Similarly, the Courts have found that Parliament
has exclusive jurisdiction over interprovincial and international telecommunications
undertakings, including companies who operate in a single Province but whose undertakings
extend beyond the limits of the Province through their interconnection with the public
switched telephone network or otherwise.10 Because distribution undertakings provide both
broadcasting and telecommunications services, these undertakings are subject to federal
jurisdiction under both aspects of their dual nature.
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95.The Commission considers that subsection 43(5) is integral to the federal
legislative scheme relating to broadcasting distribution and telecommunications. The
communications system of a distribution undertaking, including the coaxial or fibre optic
cable and associated equipment, represents a fundamental element of the undertaking's
operation in broadcasting and telecommunications. Without the communications system, a
distribution undertaking cannot provide services to the public or meet its obligations
under the Broadcasting Act. A distribution undertaking must have access to support
structures in order to maintain and upgrade existing plant as well as extend its system to
new customers and service areas. Such maintenance, upgrades and service extensions are
required to meet the Applicants' existing regulatory obligations under the Broadcasting
Act, as well as to permit the Applicants to compete effectively in the supply of
broadcasting and telecommunications services. Contrary to the MEA's suggestion, the
communications system forms an integral and indivisible part of the undertaking's
operations whether in broadcasting or telecommunications. Furthermore, the denial of
access to supporting structures may force the distribution undertaking to discontinue its
service to the public which it is licensed to serve or result in the unnecessary
duplication of supporting structures, the cost of which would ultimately be borne by
subscribers.
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96.In the Commission's view, the transmission lines of a distribution undertaking are a
vital part of its operations just as they are a vital part of a telephone company.11 As
noted by Martland J. in the Supreme Court of Canada's decision in Quebec (Commission du
salaire minimum) v. Bell Telephone Co. of Canada12, an undertaking is not a physical
thing, but is an arrangement under which physical things are used and, where matters are a
vital part of the operation of an interprovincial undertaking as a going concern, such
matters are subject to the exclusive legislative control of the federal Parliament.
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97.As noted by Telus, under the pith and substance doctrine, a law that is classified
as being "in relation to" a matter within the competence of the enacting body
may have an incidental or ancillary effect on matters outside the competence of the
enacting body. With respect to these incidental or ancillary effects, legislative power is
concurrent rather than exclusive, but the presence of valid federal legislation will in
any event force out provincial legislation through principles of paramountcy. Under this
analysis, if subsection 43(5) of the Act is, in pith and substance, legislation "in
relation to" a matter of federal jurisdiction, it may validly affect issues of
property and civil rights within a province.13 The Commission notes, for instance, that
although the Respondents are regulated under provincial legislation, certain aspects of
their activities may be subject to the jurisdiction of Parliament on the basis that the
matter is integral to federal jurisdiction.14 The existence of valid provincial
jurisdiction over intraprovincial power utilities does not render them immune from valid
federal legislation in the present circumstances.
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98.The powers conferred on the Parliament of Canada under subsections 91(29) and 92(10)
of the Constitution Act, 1867 have been widely construed in relation to the purpose and
the interests which the federal legislation is formulated to achieve. For example,
Parliament's jurisdiction over federal undertakings has been consistently found by courts
to include the jurisdiction to confer upon them the right to enter upon the streets and
highways of municipalities, without their consent, in order to construct conduits, lay
cables or erect poles.15 The jurisprudence relating to similar subsections in predecessor
legislation is particularly relevant and is clearly applicable to the present legislative
scheme found under section 43.
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99.The Commission considers that the impugned subsection is not in relation to the
intraprovincial generation or distribution of electricity, which is a matter within
provincial jurisdiction as a "local works and undertakings" within subsection
92(10) of the Constitution Act, 1867.16 Legislation which seeks to foster and promote the
efficient joint use of poles by federal undertakings is not a colourable attempt to
regulate the municipal power utilities' core activities.
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100.The Commission is also of the view that the provincial legislative scheme
pertaining to municipal power utilities does not displace, but in fact can stand side by
side with, the authority conferred upon the Commission by Parliament in section 43 of the
Act. Even if there was an inconsistency between the two statutes, subsection 43(5) would
be paramount. The Commission, however, considers that no such inconsistency exists in the
present case since providing access to the support structures of municipal power utilities
represents an ancillary function of these entities. The application of subsection 43(5)
does not involve encroaching upon their core activities. Electrical distribution systems
have operationally been able to coexist for many decades on the same poles that support
distribution and telephone plants.
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101.The Commission acknowledges that subsection 43(5) could result in some degree of
interference with the contractual or proprietary rights of the public utilities. As
submitted by Telus and the MEA, the appropriate test to be applied in determining whether
a federal law may validly affect a provincial matter will depend on the degree of
encroachment upon the provincial matter. In this regard, the MEA noted that this involves
adducing considerable evidence of the degree to which a provision in question affects
provincial powers. While the MEA has asserted that the application of subsection 43(5)
would result in a significant encroachment into provincial matters, it has not provided
the evidence to establish the degree of encroachment which it alleges, despite the
opportunity given it to do so in this proceeding.
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102.The Commission notes that the "interference" or "encroachment"
upon public utilities is limited on the face of the present legislation. In particular,
subsection 43(5) only applies where the parties are unable to agree on the terms of a
joint use arrangement, only with respect to a right of access to the supporting structures
of a transmission line constructed on a highway or other public place, and only for the
purpose of providing services to the public. As submitted by Telus, the right that is
granted is merely one of access to supporting structures, not an easement, and presumably
does not interfere with the operation of the electrical poles. If the Commission must
intervene and set terms of access to power utilities' supporting structures, it would
necessarily do so in a manner that would not prevent the transmission of electricity in a
safe and technically acceptable manner.
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103.The Commission agrees with Stentor that it would be inappropriate to conclude that
Parliament intended to authorize the Commission to regulate the provision of access to
support structures owned or operated by municipal power utilities on an ongoing basis. On
plain reading of subsection 43(5) and on the basis of the context in which subsection
43(5) is found, subsection 43(5) is intended to provide the Commission the ability to
resolve disputes on a case by case basis.
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104.Given the above, the Commission is of the view that any encroachment is of a minor
nature. As noted by Telus, the test to be applied to determine how necessary the impugned
provision is to the otherwise valid legislative scheme will depend on the degree of
encroachment on provincial powers. For minor encroachments, the rational functional test
is appropriate; for major encroachments, a stricter test as to whether the provision is
truly necessary or essential will apply.
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105.The Commission considers that there is a rational and functional connection between
a valid purpose of the Act and the need for access to supporting structures. Furthermore,
because subsection 43(5) provides a less intrusive alternative to the construction rights
contained in the legislative scheme under section 43, the Commission considers that
subsection 43(5) is truly necessary or essential to facilitate the efficient and orderly
development of a telecommunications system in accordance with the Telecommunications Act
and the Canadian telecommunications policy objectives.
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106.In light of the above, the Commission has concluded that subsection 43(5) of the
Act should not be adjudged to be invalid, inapplicable or inoperable.
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5.2 Statutory Jurisdiction
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a.Approach to Statutory Interpretation
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107.The Commission considers that the terms and phrases in subsection 43(5) must be
interpreted based on their ordinary meaning as well as the context of the Act as a whole.
It is a well-known principle of statutory interpretation that the words of a statute are
to be given their ordinary meaning unless the context requires otherwise.17 Furthermore,
the generally accepted approach to statutory interpretation requires that a statutory
provision be read in the context of the whole Act, bearing in mind the purpose and the
scheme of the Act. This purposive approach has been described as follows:
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Today there is only one principle or approach, namely, the words of an Act are to be
read in their entire context and in their grammatical and ordinary sense harmoniously with
the scheme of the Act, the object of the Act and the intention of the Act.18
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108.This rule has evolved into what is now known as the "modern rule" whereby
one must determine the meaning of the legislation in its total context having regard to
the purpose of the legislation, the consequences of the proposed interpretations, the
presumptions and special rules of interpretation and admissible external aids.19 An
appropriate interpretation is said to be one that can be justified in terms of its
compliance with the legislative text or its plausibility, its promotion of the legislative
purpose or its efficacy and its acceptability in leading to an outcome that is just and
reasonable.20
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109.Furthermore, the Commission notes that section 12 of the Interpretation Act
provides that "every enactment is deemed remedial and shall be given such fair, large
and liberal construction and interpretation as best ensures the attainment of its
objects".
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110.The Commission has examined the various submissions relating to the interpretation
of the words and phrases contained in subsection 43(5) bearing these various principles in
mind.
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b.Legislative History
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111.Sections 42 and 43 are two of a number of provisions included in a part of the Act
entitled "Construction and Expropriation Powers" (sections 42 through 46).
Section 54 of the National Telecommunications Powers and Procedures Act was the immediate
predecessor to section 42, although a similar provision has been in existence in one form
or another in the Railway Act since 1888. Predecessor provisions to subsections 43(1) to
(4) of the Act were contained in the Railway Act and courts have interpreted those
provisions broadly.21 There are no predecessors to subsection 43(5) in the previous
legislation. In order to construe this provision in its proper context, in light of the
mischief the subsection was intended to address, a review of the submissions, reports and
debates leading to the adoption of section 43 of the Telecommunications Act in 1993
[formerly Bill C-62, An Act Respecting Telecommunications (Bill C-62)], while not
determinative, is helpful.
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112.The questions relating to the joint use of support structures and access to
rights-of-way were addressed as early as 1991 by the Local Networks Convergence Committee
appointed under the authority of the Minister of Communications. The Committee developed
recommendations for changes in government policy and regulation to govern the future
evolution of the local telecommunications network infrastructure, and the increasing
convergence of the services and markets of telephone companies and cable operators.
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113.The Committee's report stated that Government policy, regulation and industry
practice have long recognized that there are good economic, environmental and aesthetic
reasons for sharing support structures between the telephone and cable industries, as well
as others, notably electrical power utilities.22 The report noted that regulatory
intervention was required in the early days of the cable industry to order telephone
companies to make their support structures available to cable operators on reasonable
terms.23 It also indicated that telephone companies have entered into agreements with
electrical utility companies to ensure that support structures are efficiently shared in
the provision of electrical power and telephone services. In the Committee's view, the
duplication of aerial support structures was not economically efficient and could have
adverse environmental and aesthetic impacts. The report noted the fact that most
electrical and telephone support structures were in place before the emergence of the
cable industry and further noted the increased importance of ensuring that measures would
be taken to make support structures available to the cable industry. It noted that, while
the cooperative arrangements relating to the joint use of support structures had been of
value in permitting the sharing of support structures, there was room for improvement. It
stated that joint-use arrangements between power utilities, telephone companies and cable
operators had successfully precluded the construction of duplicate infrastructures in many
areas.
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114.The report included a number of recommendations relating to the sharing of support
structures:
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7. Canadian policy and regulation should continue to promote the sharing of support
structures by telephone companies, cable operators and other support structure providers.
In this regard, the concept of support structures should be defined more broadly in the
future, taking into account new technologies such as fibre optic cables, for which sharing
arrangements can improve the efficiency of the local network infrastructure.
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8. Government policy and regulation should not prevent the development of joint
ventures between telephone companies and cable operators that are aimed at achieving more
effective and efficient sharing of support structures.
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9. Telephone companies and cable operators should, in conjunction with electrical power
utilities, and other providers of support structures, establish better cooperative
mechanisms to plan the shared construction and use of support structures. Where necessary,
regulators should intervene to ensure that such cooperative mechanisms are developed and
implemented and that they function effectively.24 (emphasis added)
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115.The report also addressed issues relating to ensuring that cable operators are
granted a legal right of access to rights-of-way for the purposes of installing their
transmission lines and associated support structures. Representatives of the cable
industry had advocated the importance of such rights in situations where access to support
structures of telecommunications common carriers, electric power utilities and other
providers of support structures was unavailable. Telephone company representatives had
expressed concerns that such a right of access to rights-of-way would lead to duplication
of support structures. The cable industry had agreed that a right of access on its part to
public rights-of-way should only arise if suitable support structures were not available
on reasonable terms. The report underlined the importance of joint use of structures as
the primary course of action as follows:
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In order to prevent unnecessary duplication of support structures, as well as potential
environmental disruption and aesthetic problems, government policy and regulation should
continue to require cable operators to negotiate with other potential suppliers of support
structures to obtain suitable facilities. However, where these negotiations are
unsuccessful, it would be reasonable to grant cable operators similar rights of access to
public rights of way as telephone companies. At the federal level, these rights, which are
currently set out in the Railway Act, are proposed to be simplified and updated by means
of clauses 48 and 49 of Bill C-62.25
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116.The Committee concluded its remarks with the following recommendation:
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10. Cable operators should have the same rights of access to public rights of way as
federally regulated telephone companies in circumstances where suitable support structures
are not available to them on reasonable terms and conditions from telephone companies,
electric power utilities or other providers of support structures.26
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117.Prior to tabling Bill C-62 before the House of Commons, the Senate Committee on
Transport and Communications undertook to pre-study its subject matter. The submissions
made on behalf of the cable companies raised the question of providing them with the same
rights of access as telephone companies. With respect to these concerns, the Senate
Committee recommended:
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We further recommend that the cable industry should be entitled to the construction
powers to be granted all federally-regulated telecommunications carriers, by way of a
consequential amendment to the Broadcasting Act.27
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118.Following the Senate Committee's report, there were no provisions relating to
construction and access by distribution undertakings in Bill C-62. At First Reading in the
House of Commons, the provisions relating to construction powers applied only to
"Canadian carriers" and not to distribution undertakings. There was no reference
to access to supporting structures.
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119.Following Second Reading, submissions were made before the House of Commons
Sub-Committee on Bill C-62 of the Standing Committee on Communications and Culture.
Several submissions before this Sub-Committee addressed the need to grant the same rights
of access to rights-of-way to cable operators as those provided for telephone companies.
These emphasized the need to clearly define cable's access to public rights-of-way to
include the same recognized legislative power to access public roadways and places as is
currently enjoyed by telephone companies in view of the new competitive environment. The
submissions specifically referred to access being frustrated or instances where the
support structures are unavailable and no other alternative is available to resolve the
problem. While such a right of access was said to be implicit under the Broadcasting Act
in view of the legal duty to make service available to each household or premise within
its licensed service area, the cable operators underlined the importance of having an
express right, in view of the increasing convergence and competition in the market. The
provinces, on the other hand, raised concerns about a proliferation of undertakings trying
to "dig up highways".
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120.The Minister of Industry proposed to the Commons Sub-Committee to amend the
provisions in the following manner:
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- If the subcommittee agrees, clauses 48 and 49 [now sections 43 and 44 of the Act], will
be amended so that they apply equally to broadcasting distribution undertakings as defined
under the Broadcasting Act. In addition, we will propose an amendment to clause 48 of the
bill that will provide for efficient use, by those serving the public, of support
structures constructed on public rights of way and require the CRTC to take account of all
uses of the right-of-way or other public place prior to issuing any orders under this
clause.
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121.Accordingly, the section was amended to include reference to distribution
undertakings in subsections 43(1)28 to (4), and subsection 43(5) was added in its
entirety. The amendments were adopted on Third Reading without any further discussion.
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122.Based on the concerns expressed and the comments and recommendations made prior to
the addition of subsection 43(5), the Commission is of the view that the underlying intent
in adding that provision was to ensure that the granting of construction rights to
Canadian carriers and distribution undertakings to build their own infrastructure did not
represent the only alternative available to these undertakings where a more efficient use
of existing support structures could be made available.
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123.The Commission also considers that such an intent can be reasonably inferred from
the fact that the exercise of construction rights by Canadian carriers and distribution
undertakings is not an unfettered power. Such powers are subject to not "unduly"
interfering with "the public use and enjoyment of the highway or other public
place" and must be exercised upon obtaining consent from the municipality or other
public authority having jurisdiction. Furthermore, where consent is not available and the
Commission intervenes, the Commission must have due regard to the use and enjoyment of the
highway or other public place by others. In the Commission's view, the pre-existence of
supporting structures would be a consideration relevant to the granting of a permission to
construct a separate infrastructure. In this respect, it may be said that subsection 43(5)
provides a natural complement to subsections 43(2) to 43(4) of the Act.
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124.The Commission is of the view that it is reasonable to conclude that the
legislative history leading to subsection 43(5) lends support to the proposition that
subsection 43(5) was added to address concerns relating to the granting of construction
powers which could lead to unnecessary construction on highways and other public places.
The legislative history lends support to the proposition explored below, that it is
appropriate to construe this subsection broadly to include the supporting structures of
all utilities, including electrical power companies. By allowing access to existing
supporting structures irrespective of the type of utility owning or controlling such a
structure, the adverse environmental, economic and aesthetic impact associated with
unnecessary duplication of aerial supporting structures is avoided.
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c.Canadian Telecommunications Policy and Other Public Interest Concerns
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125.As noted previously, the Commission must, pursuant to paragraph 47(a) of the Act,
exercise its powers and perform its duties under the Act with a view to implementing the
Canadian telecommunications policy objectives outlined in section 7. Therefore, in
interpreting the scope of subsection 43(5), the Commission must have regard to
implementing these policy objectives.
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126.The Commission notes that there are a number of considerations relating to
supporting structures which should be evaluated in light of section 7 of the Act:
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(1) The failure to facilitate the orderly development of Canada's telecommunications
system would appear to be contrary to the objectives of paragraph 7(a) (strengthening the
economic fabric of Canada and its regions);
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(2) If duplicate infrastructures are financed and constructed despite the added costs,
unnecessary capital and operational costs would ultimately have to be borne by
subscribers. Such a result would appear to be contrary to the objectives of paragraph 7(b)
(affordable telecommunications services);
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(3) The capital costs inherent in the construction of duplicate infrastructures may
operate as a barrier to entry and a disincentive for the deployment of networks which are
essential to an information-based society and economy. Such a result would appear to be
contrary to the objectives of paragraphs 7(a), 7(c) (to enhance the efficiency and
competitiveness of Canadian telecommunications) and 7(f) (to foster increased reliance on
market forces for the provision of telecommunications services);
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(4) The development of duplicate infrastructures also raises the prospect of
considerable inconvenience to the public as crews from various service providers go about
deploying, maintaining, and altering their separate networks near or under Canadian
streets, highways and other public places according to their own schedules. These
consequences would appear to be contrary to the objectives of paragraphs 7(c) and 7(f).
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127.Historically, the support structures of Canadian electrical power utilities have
constituted an important element of Canada's telecommunications system and an important
component required for the delivery of broadcasting services to the Canadian public.
Interpreting subsection 43(5) as extending to the supporting structures of electrical
power utilities would be consistent with the attainment of the objectives of Canadian
telecommunications policy, including facilitating the orderly development of a
telecommunications system that serves to safeguard, enrich and strengthen the social and
economic fabric of Canada and its regions.
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128.The Commission has recognized the public interest in the sharing of support
structures at least since 1977.29
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129.Furthermore, as a result of the telecommunications policy objectives, and
particularly paragraph 7(f), the Commission has undertaken a course of regulatory action
in order to implement a regulatory framework which places greater emphasis on market
forces and competition.30 Similarly, under its jurisdiction pursuant to the Broadcasting
Act, the Commission has implemented a framework to encourage competition in the
distribution of broadcasting services.31 As a result of competition and the emergence of
additional industry players, there will be growing pressures with respect to the
construction of new communications support structures and use of existing structures.
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130.In Decision 95-13, the Commission clearly stated its policy with respect to joint
use of support structures as follows:
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The Commission is of the view that it is in the public interest to minimize the number
of support structures (poles and conduit) through joint use of those structures,
regardless of their ownership. Moreover, the Commission expects that maximizing the use of
support structures (in terms of the number of companies using each structure) will help
facilitate interconnection and interoperability between Canadian carriers and cable
television undertakings. [...]
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With respect to the issue of joint ownership of support structures, the Commission
notes that, historically, many telephone companies and power companies in Canada have
participated in arrangements where each partner contributed to the capital investment.
Thus, in some arrangements, the partners have joint ownership of the structure. In such
situations, each participant has had a measure of control and influence over the
provisioning of the structures. The Commission is of the view that these arrangements
appear to have functioned adequately, and sees merit in parties, including cable
television undertakings, seeking access to a large number of structures entering into
arrangements where they would share in the capital investment and maintenance costs.
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131.The construction of distribution infrastructures is required in order to provide
telecommunications and broadcasting services to the public. In the Commission's view, an
approach that forces each operator to construct its own duplicate infrastructure is not in
the public interest. The Commission believes that the development of a proper distribution
infrastructure will be as important to the Canadian economy in the 21st century as was the
construction of a railway infrastructure in the 19th century.
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132.In addition to the policy objectives of the Act, the Commission notes that
Parliament has declared at subparagraph 3(1)(t)(ii) of the Broadcasting Act that
distribution undertakings should provide efficient delivery of programming at affordable
rates, using the most effective technologies available at reasonable costs. The Commission
notes that there may also be detrimental environmental and aesthetic consequences linked
to the construction of avoidable duplicate infrastructures, particularly with respect to
aerial transmission lines. Therefore, apart from the objectives declared by Parliament in
the Canadian telecommunications policy, efficient use of existing supporting structures
appears to be consistent with the broader public interest.
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d.Interpretation of "person who provides services to the public"
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133.The MEA argues that subsection 43(5) does not apply to distribution undertakings.
The MEA notes that Parliament used the expression "person who provides services to
the public" in subsection 43(5) rather than "Canadian carriers" and
"distribution undertakings" which are used in the related provisions of sections
42 and 43, and suggests that there is an inconsistency between the word "person"
in the English version and the use of "fournisseur" in the French version. The
MEA concludes that subsection 43(5) was enacted in order to allow non-broadcasting
entities to gain access to the poles Canadian carriers and distribution undertakings were
given the power to construct under sections 42 and 43.
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134.The Commission considers that the MEA's argument cannot be sustained. Clearly,
distribution undertakings provide services to the public. The use of the term
"fournisseur" clearly denotes a service provider when read in the context of
subsection 43(5). Given the legislative history, the policy objectives of the Act, the
plain wording of the subsection and the rest of section 43, the Commission considers that
subsection 43(5) provides a statutory remedy to cable distribution undertakings as well as
to Canadian carriers and other persons who provide services to the public as part of a
comprehensive legislative scheme designed to allow for the orderly deployment of the
distribution plant of these entities and the efficient joint use of existing support
structures located on a public place. It is the Commission's view that any interpretation
of the expression "person who provides services to the public" that excludes
distribution undertakings would negatively affect these federal undertakings and would be
contrary to Parliament's intent.
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e.Need for Prior Negotiation
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135.With respect to the appropriate degree to which the parties have to attempt to
negotiate before bringing a dispute to the Commission, the Commission is of the view that
there is no explicit or implicit statutory requirement to that effect.32 The Commission
considers that subsection 43(5) of the Act applies in circumstances where a cable operator
is unable, on acceptable terms, to gain access to supporting structures pursuant to an
initial support structure agreement. The subsection would also be applicable where,
despite the existence of an agreement, the person seeking access is in fact unable to gain
access on acceptable terms or is otherwise unable to restore a previous contractual
relation.
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136.The Commission considers that it is generally sound policy to require the parties
to proceed to good faith negotiations prior to seeking a Commission determination. In
particular, the Commission's decision of 27 March 1997, which instituted a non-binding
dispute resolution process, illustrates the Commission's desire to see prior negotiations
occurring. In the Commission's view, it is clear, in this case, that there have been
extensive negotiations, that further negotiations will not be fruitful and that the
Applicants are unable to gain access on terms acceptable to them.
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f.Interpretation of "any conditions that the Commission determines"
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137.With respect to the MEA's suggestion that the Commission's jurisdiction to set
conditions of access is unclear and perhaps limited, the Commission is of the view that
the phrase "any conditions that the Commission determines" is unambiguous and
sufficiently broad in scope to allow the Commission to set rates, terms and conditions of
access to supporting structures.
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138.The Commission acknowledges that Parliament did not intend the Commission's
jurisdiction to include the ongoing regulation of the rates, terms and conditions
applicable to the use of support structures owned by municipal power utilities but rather,
provided the Commission the ability to resolve disputes on a case by case basis.33
Furthermore, it is the Commission's view that the terms of access imposed by the
Commission in the resolution of such disputes should continue to apply until the parties
can agree otherwise.
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139.As noted previously, the Commission considers that the conditions attached to a
permission granted under subsection 43(5) must, by necessity, be drafted so as to not
prevent the power utility's poles from being used in a safe and technically acceptable
manner. This is consistent with the approach taken by the Commission previously in
relation to the terms of access to telephone company support structures as stated in
Decision 95-13:
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The Commission is of the view that the owners of support structures have the right to
set and enforce construction standards, provided that those standards are based on safety
and technical requirements and do not unreasonably impede access by other
telecommunications carriers and cable television undertakings.
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g.Interpretation of "transmission line"
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140.With respect to the MEA's submission that the use of the phrase "transmission
line" refers to a transmission line of a telecommunications common carrier or a
distribution undertaking rather than the power line of a public utility, the Commission is
of the view that the use of the phrase is sufficiently broad to include electrical
transmission lines. The Commission has based its determination upon the ordinary meaning
of the phrase as well as upon reading the words in the context of section 43 and the Act
as a whole, bearing in mind the purpose and the scheme of the Act.
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141.The Commission notes that the Act does not provide a definition of
"transmission line". The Commission notes the following dictionary definitions
of "transmission line" or "ligne (de transmission)":
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- transmission line, a conductor or set of conductors designed to carry electricity (esp.
on a large scale) or electromagnetic waves with minimum loss and distortion; [The Oxford
English Dictionary, Second Edition]
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- transmission line: a metallic circuit of three or more conductors used to send energy
usu. at high voltage over a considerable distance; specif. : a usu. metallic line used for
the transmission of signals or for the adjustment of circuit performance and often
consisting of a pair of wires suitably separated, a coaxial cable, or a wave guide.
[Webster's Third New International Dictionary, 1981]
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- ligne: III [...] 3º Système de fils ou de câbles conduisant et transportant
l'énérgie électrique. Ligne à haute tension. - Spécialt. Ligne électrique assurant
les communications par télégraphe ou téléphone. [Le Petit Robert, 1988]
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142.Based on these definitions, it may be reasonably concluded that the ordinary
meaning of "transmission line" or "ligne de transmission" includes, in
addition to the transmission lines of telecommunications common carriers and of cable
distribution undertakings, the transmission lines used to distribute electrical power.
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143.In addition, the Commission is of the view that such an interpretation is
consistent with the fact that elsewhere in the Act the expression "transmission
line(s)" is narrowed by being qualified as the transmission line of a Canadian
carrier or a distribution undertaking.34 This is particularly relevant in section 43,
where subsections 43(2) to (4) contain such a qualification while subsection 43(5) does
not.
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144.The Commission also notes that Parliament has used the apparently narrower
expression "telecommunications line" when it defined, at subsection 2(1) of the
Act, the term "international submarine cable".
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145.Consistent with the Commission's finding that the words "transmission
line" include electrical transmission lines, the Commission is of the view that the
expression "supporting structure of a transmission line" in subsection 43(5) is
intended to deal with supporting structures carrying transmission lines including the
supporting structures owned or controlled by electrical power utilities.
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146.The CCTA submitted in its intervention that Parliament must be taken to have been
aware of certain facts relating to the ownership of support structures in Canada when the
Act was enacted. The Commission notes that cable distribution undertakings have made use
of support structures of power utilities since the 1950s. In addition, the poles of power
utilities currently constitute a significant component of the distribution networks of
both cable and telephone companies across the country. For instance, the CCTA indicated
that in Alberta almost all the supporting structures are owned by the power utilities. The
CCTA also indicated that in Newfoundland there is a high level of mixed ownership of the
poles used to support transmission lines, such that in any stretch of poles some may be
owned by NewTel Communications Inc. (formerly Newfoundland Telephone Company Limited)
(NewTel), and others by Newfoundland Power. The CCTA argued that it would make it futile
to grant access only to the poles owned by telephone companies. In the Commission's view,
Parliament could not have intended such a haphazard access regime.
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147.Telus' interpretation of subsection 43(5) to the effect that it is intended to deal
with situations where telecommunications transmission lines are already occupying support
structures is overly restrictive, contrary to the Canadian telecommunications policy
objectives and inconsistent with the ordinary meaning ascribed to subsection 43(5). Such a
restrictive interpretation would create a barrier to entry for new competitors in both
cable distribution and local telephony, thereby favouring incumbent service providers such
as Telus. New entrants would be forced to exercise their construction rights under
subsections 43(2) to (4) of the Act in order to build a duplicate network. Therefore, the
Commission rejects the narrow alternative interpretation that would require the
"telecommunications" transmission lines to be present on the support structures
before an application for a right of access can be made pursuant to subsection 43(5).
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148.In the Commission's view, the language found in subsection 43(5) is sufficiently
broad to mean any existing support structure carrying any type of transmission line.
Furthermore, such an interpretation is entirely consistent with section 43 and the Act as
a whole. Section 43 of the Act establishes a complete legislative scheme to enable
Canadian carriers and distribution undertakings to construct, operate and maintain their
transmission lines. Subsections 43(2) through 43(4) deal with situations where it is
necessary to construct support structures. Subsection 43(5) addresses the situation where
support structures carrying transmission lines already exist. In the Commission's view, to
suggest that access under subsection 43(5) is limited to support structures carrying only
certain types of transmission lines or support structures owned or operated by certain
entities would not only be contrary to the words read in their ordinary sense but would
also create an unjustifiable gap in the legislative scheme found in section 43. In view of
the object of section 43 and the policy objectives in section 7, the Commission concludes
that the phrase "supporting structure of a transmission line" must be
interpreted to mean any supporting structure that serves to carry a transmission line and
that already exists. The Commission considers that this interpretation is consistent with
the public interest and the objectives of the Canadian telecommunications policy.
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h.Interpretation of "highway or other public place"
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149.The Commission does not accept the MEA's argument that the expression "other
public place" must be interpreted narrowly because it follows the word
"highway". The MEA's interpretation would mean that "other public
place" would have to be in the nature of a highway or something similar and would
exclude poles located on a public utility right-of-way. Contrary to the narrower
contextual approach suggested by the MEA, the Commission is of the view that, in
accordance with generally accepted principles of statutory interpretation, the contextual
approach would require the term "other public place" to be read in the context
of the whole of the subsection, the section and the Act and not merely in relation to the
term "highway". Given the purpose of subsection 43(5), the section and the Act
as a whole and given that Parliament must be presumed to have been aware of the location
of support structures, it is entirely inappropriate to read "other public place"
as being limited to a location having the same type of public access as a
"highway".
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150.The Commission considers that the phrase "other public place", in light
of the purpose and the context of subsection 43(5) and the Act as a whole cannot be
limited to land that is necessarily open to the general public. The meaning of
"public place" will depend on the specific purpose and legislative context in
which it is used. Private ownership is not necessarily incompatible with the conclusion
that a place is public. For instance, courts have held that a privately owned property can
be a public place if the public or a portion of the public can generally have access to
it. For example, the Broadcasting Act excludes from the definition of
"broadcasting" a transmission of programs that is made solely for performance or
display in a "public place". In that context, sports arenas have generally been
considered public places even if privately owned and even though payment may be required
for entry. In the case of the Telecommunications Act, there is no clearly applicable
precedent.
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151.The restrictive interpretation suggested by the MEA would mean that access to a
string of poles would be impeded if some poles that are located on a public utility
right-of-way or easement were interspersed amongst others located on a
"highway". As submitted by the CCTA, this interpretation would result in a form
of "jurisdictional hopscotch" in that subsection 43(5) would apply to the
majority of support structures, but not to the exceptional few. This would have the effect
of entirely frustrating the purpose of subsection 43(5) which is to facilitate and promote
the efficient use and sharing of support structures. As noted previously, Parliament must
be presumed to have been aware of the location of support structures on public utility
rights-of-way or easements. The Commission considers that "highway or other public
place" is broader than what the MEA would have the Commission find.
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152.The Commission notes that subsection 43(5) deals with access to existing supporting
structures. It is not a means to create an easement and cannot serve to create rights of
entry upon property where such rights do not already exist or are expressly limited.
However, for the purpose of identifying the support structures falling within the scope of
subsection 43(5), and in light of the purpose and context of subsection 43(5), the
expression "highway or other public place" should be read to include any public
utility easement or right-of-way dedicated to the placement of public utility facilities
for the benefit of the public.
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153.The Commission considers that a supporting structure located on a public utility
easement or right-of-way cannot be characterized as being located on purely private
property. The right of a public utility in a public utility easement is a conditional
right and not an exclusive private right, at the expense and detriment of the public and
of other public utilities also charged with the duty of providing a service. The public
interest forms an integral part of public utilities. Where one devotes its property to a
use in which the public has an interest, one in effect grants to the public an interest in
that use, must submit to be controlled by the public for the common good and such property
ceases to be juris privati.35
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154.The Commission notes that the Ontario Court of Appeal has recognized that the
principle establishing an agency relationship between a public utilities commission and a
municipality has existed at common law for more than a century.36 It also notes that a
statutory agency relationship may also be established under the constituting legislation
creating a specific PUC. In the Commission's view, where a PUC acquires an easement, it
acquires the easement as an agent for the city. It is a benefit for the distribution
system, not only for the actual customers but also for the city at large.37 Accordingly,
in view of the fact that public utility easements are acquired to serve a public purpose
for the benefit of the general public and not merely for the private use and purpose of
individuals, the Commission finds that it is reasonable to include support structures
located on public utility easements within the scope of the expression "constructed
on a highway or other public place". The fact that a public utility right-of-way is
one for the benefit of the municipality at large would lend support to the use of such
access rights by cable companies for the benefit of the public at large.
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155.The MEA has indicated in its final submissions that some power utility poles are
situated on private land without the benefit of a right-of-way or easement. In this
regard, the Commission notes that the MEA acknowledges that 92% of the support structures
owned by 18 of the municipal power utilities it represents are located on the road
allowances of highways or streets.
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156.While the CCTA has stated that the remaining 8% are situated on property which is
subject to statutory or consensual public utility easements or rights-of-way, the MEA has
indicated, in reply, that "some" of these poles are located on public property,
"many" are on private land without the benefit of a right-of-way or easement
and, in "some cases", specific landowners have allowed power utility poles to be
located on their land without granting a right-of-way.
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157.The Commission is of the view that, despite the fact that the MEA is in the best
position to provide factual support for their submission, it has failed to provide
appropriate evidence to substantiate it, choosing instead to rely on ambiguous words such
as "some" and "many" to denote a subset of the remaining 8%. In
addition, the Commission notes that, because this was raised at the reply stage, there was
no opportunity for the CCTA to comment on the undefined proportion of the remaining 8% of
the poles or the extent of this situation.
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158.The Commission finds it difficult to surmise that there is no right-of-way with
respect to poles, in view of the safety and maintenance requirements of such structures.
In the Commission's view, the presence of support structures on private land would by
necessity require the owner of the support structure to retain a means to ensure public
safety and system security.
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159.The Commission notes that PUCs may acquire easements in a number of ways, including
transfers of easement from Ontario Hydro, purchases of easement from private land owners,
easements received from owners of registered plans of subdivision, easements on lands
conveyed as a condition for granting of a consent for severance or as a result of a
condition imposed in a site plan control agreement between a private land owner and the
Regional Municipality and by way of statutory rights of access. In the Commission's view,
it would be reasonable and appropriate for the Commission to apply an evidentiary
presumption that de facto public utility easements exist.
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160.The Commission considers that the acquisition of limited rights and interests by
the public utility to gain access to its support structure through easements, leases,
licenses of occupation or permits is not expropriation in the sense that there is no
change in ownership of the land. However, the Commission acknowledges that the acquisition
of such rights may, in certain circumstances, entail compensation to the land owner,
depending on inconvenience, land value, impact on property, loss of production of farm
land, etc. and may be restricted to specific uses or users.
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161.The Commission recognizes that, when determining the permissible uses of an
easement on private land, consideration must be given to a number of circumstances in
existence at the time of its creation. Such an assessment would include consideration of
the reasonable expectations of the parties, taking into account the nature of the
easement, its purpose, the extent of the burden on the land and their expectations as to
the normal development of the user and the projected use of the easement. In the absence
of evidence to the contrary (such as specific restrictive terms), it may be found that the
parties anticipated changes in the future which could affect the use of the easement
consonant with changed realities, such as those affecting land use patterns, or
technological development.
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162.It is the Commission's view that, absent specific restrictions in the terms
creating the easement, the cable company's use of a public utility's right-of-way to gain
access to power utility poles, being consistent with the underlying purpose of the public
utility right-of-way, would not generally constitute an unauthorized enlargement and
alteration in the character, nature and extent of the easements relating to the public
utility's supporting structures, especially where the change in the nature or intensity of
the use does not cast an unreasonable burden on the land affected. In this regard, the
rights attached to each public utility easement will be dependent upon the specific terms
under which they were acquired. The terms of the easements must be construed in light of
the purposes for which they were intended to be used.
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163.The Commission considers that terms of access to the public utility easements are
beyond the scope of subsection 43(5), which relates to access to the support structures.
Cable distribution undertakings may be required to negotiate with the land owner their own
right of access, including compensation, where the terms of access to the public utility
easement are specifically restricted in relation to the permitted use or user.
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164.The Commission is of the view that it has jurisdiction to grant a remedy pursuant
to subsection 43(5) of the Act, subject to any conditions that it determines are
reasonable in the circumstances. In particular, the Commission notes that the Applicants
are distribution undertakings within the meaning of subsection 2(1) of the Broadcasting
Act and are persons who provide services to the public who cannot, on terms acceptable to
them, gain access to the supporting structures of transmission lines constructed on a
highway or other public place, as contemplated under subsection 43(5) of the Act.
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B.Procedural Fairness
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165.The Commission is of the view that the MEA's submissions regarding the alleged
unfairness of the proceeding resulting from the staff opinion are unfounded.
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166.In its final and reply comments, the MEA submitted that the staff opinion has
tainted this entire proceeding with unfairness and that the CCTA relied, in large part, on
the staff opinion to justify a low pole rental rate. The MEA stated that parties were
directed by the Commission to participate in a dispute resolution process in an attempt to
settle the dispute without a ruling from the Commission. The MEA added that parties were
informed that submissions, as well as the eventual staff opinion would form part of the
record placed before the Commission. The MEA further stated that the resulting staff
opinion, did not take into account or even refer to the extensive oral submissions made by
the MEA in an attempt to resolve the dispute. It noted that the recommended pole rental
rate in the staff opinion was the same rate charged by Ontario Hydro, despite the fact
that no evidence concerning pole attachment on Ontario Hydro's poles was before the
Commission or staff. The MEA submitted that, as a result, the Commission should exclude
from consideration the staff opinion, and the portions of the CCTA's submissions relying
on the staff opinion.
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167.With respect to the MEA's complaint that the staff opinion did not take into
account or refer to the extensive oral submissions made by the MEA, the Commission notes
that, as confirmed by the courts, it is neither practical nor necessary for Commission
decisions to repeat each and every party's arguments leading to a decision. This should be
all the more so for a non-binding staff opinion arising from a less formal process.
However, the Commission notes that the staff opinion was nonetheless based on all of the
submissions leading to and including the dispute resolution process. Moreover, the staff
opinion was not written with a view to reiterating the parties' positions which were at an
impasse, but rather was designed to facilitate the reaching of an agreement between the
parties with the assistance of staff's preliminary opinion on the rate issue.
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168.As stated in the Commission's letter decision of 27 March 1997 which outlined the
dispute resolution process, the staff opinion was meant to provide a concise report
outlining staff's views on some or all of the issues that remained to be resolved. Parties
were expected "to attempt, with the benefit of the staff opinion, to resolve
outstanding issues". The parties could obtain clarification with regard to any matter
contained in that opinion. In essence, it was to be used, calling upon staff's broad
knowledge and expertise in these matters, as a tool to facilitate an agreement between the
parties in an informal fashion.
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169.With regard to the complaint that the staff opinion recommended the same rate as
that charged by Ontario Hydro, despite the fact that no evidence concerning pole
attachment on Ontario Hydro's poles was before the Commission or staff, the Commission
notes that staff indicated in its opinion that, in the absence of better evidence and
persuasive arguments to the contrary, it considered the Phase II causal costing approach
to costing telephone company services an appropriate starting point to determine the
applicable rate. Staff recognized that there may be differences in the costs incurred by
power utilities with respect to support structures and, in the absence of better evidence,
found the rate proposed by Ontario Hydro in its most recent model support structure
license agreement to be appropriate in the context of power utility poles.
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170.The Commission notes that the record of the proceeding now provides the necessary
evidence for the Commission's determination of the appropriate methodology and rate
without reference to Ontario Hydro's agreed rate.
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171.It is to be noted that all parties were informed, in the Commission's 27 March 1997
decision suspending the application for interim relief pending the dispute resolution
process, that the staff opinion was non-binding and that they would be given a full
opportunity to comment on its merits as well as make further submissions, including
submissions regarding the issues of constitutional and statutory authority, if the
proceeding for interim and final relief was resumed.
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172.The Commission further notes that, while the parties have provided comments on the
staff opinion, the essence of their submissions relates to providing the groundwork and
the evidence to support their own rate setting methodology. Accordingly, the Commission
has focused its analysis on these substantive arguments in reaching its final
recommendations.
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173.For the reasons outlined above, the Commission denies the MEA's request that it
exclude from consideration the staff opinion, and the portions of the CCTA's submissions
relying on the staff opinion.
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C.The Need for Regulatory Intervention
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174.In its final comments, the MEA argued that, even if the Commission has jurisdiction
under subsection 43(5), it should refrain from exercising its jurisdiction in the present
case. The MEA submitted that there is competition between broadcasting distribution
undertakings and telecommunications carriers and therefore, the Commission should forbear
from exercising its jurisdiction under subsection 43(5). The MEA stated that, while the
forbearance power provided by section 34 does not apply to section 43, subsection 34(2) of
the Act provides for forbearance from regulation when sufficient competition exists to
protect the public. The MEA added that if the Commission in this proceeding mandates
access to power utility poles at a rate below the fair market value of the communication
space, cable companies will gain a competitive advantage over their rivals.
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175.The CCTA, in reply, submitted that, as acknowledged by the MEA, section 34 of the
Act does not apply to section 43. Moreover, the CCTA added, the MEA's argument about
forbearance conveniently neglects the public policy concerns which underlie section 43,
and subsection 43(5) in particular. The CCTA added that the environmental, safety and
public convenience issues associated with support structures highlight the need for
regulatory oversight and the inapplicability of section 34. The CCTA further added that
even if section 34 were relevant, the conditions necessary for forbearance under section
34 do not exist.
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176.The MEA also submitted that the Commission should refrain from exercising its
jurisdiction in the present case because there is no question of access being denied to
the cable companies. The MEA added that the cable companies have merely chosen not to pay
the requested price and instead asked the Commission to regulate pole attachment, despite
the existence of alternatives to pole attachment available, for example by placing cables
underground or distributing services by way of other technologies such as direct-to-home
(DTH) satellite or "wireless cable". In reply, the CCTA stated that the dispute
is about access: the MEA is demanding that the cable companies pay an annual rate of
$40.53 for access to the power utility poles.
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177.The CCTA submitted that the MEA's suggestion that the cable companies could place
their cables underground or construct their own pole lines ignores the strong public
policy in favour of sharing existing support structures. The CCTA also submitted that the
respondent power utilities have an effective monopoly in the situations under dispute and,
consequently, no form of market negotiation can take place. The CCTA added that regulatory
oversight of the cost of monopoly inputs to competitive services is neither unusual nor
inappropriate. The CCTA further added that there is nothing on the record of the
proceeding to suggest that the MEA would change its position on the appropriate level of
the pole rental rate if the Commission were to decline to exercise its jurisdiction under
subsection 43(5).
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178.The Commission notes that, as submitted by the CCTA and as acknowledged by the MEA,
section 34 of the Act may only be applied in respect of those sections of the Act that are
specified in section 34. Section 34 cannot apply with respect to the exercise of the
Commission's powers under section 43.
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179.The focus of subsection 43(5) is access to support structures. The issue is not
only whether access has been denied but rather, whether access may be obtained on terms
acceptable to the person who provides services to the public. The Commission is of the
view that an important consideration in a decision not to grant relief under subsection
43(5) would be whether there are, in fact, alternative support structure suppliers to
serve the distribution needs of the applicant seeking relief. The Commission notes that
there is not sufficient competition between support structure suppliers and, further,
considers that the alternatives to pole attachment suggested by the MEA are neither
practical nor reasonable alternatives in the present case. The business of the applicants
is to distribute television signals through cable, not through alternative distribution
technologies. Indeed, the Commission has licensed them for that purpose. Further,
subsection 43(5) applies in situations where access cannot be obtained on terms acceptable
to the applicant and is not limited to situations where access is necessarily denied.
Under the circumstances of this case, subsection 43(5) is appropriate for consideration.
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180.The Commission considers that the public policy concerns which underlie section 43
and the public interest support the need for regulatory oversight. The construction of new
support structures as well as access to existing support structures are matters of public
concern and it is not sufficient to look at these issues as involving simply the private
interests of contracting parties. The Commission also considers that all reasonable
avenues to resolve this dispute through negotiation, whether with or without Commission
staff participation, have been fully explored and further efforts of a similar nature are
unlikely to result in a break in the impasse. Despite the time that has elapsed since the
dispute arose, the parties have been unable or unwilling to reach a consensual
arrangement. In light of the above, the Commission considers it appropriate to make a
final determination on the final relief requested.
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D.Pole Costs and Rental Rate
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1.Introduction
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181.In its application, the CCTA requested that the Commission grant access to support
structures of the power utilities at the pole rental rate established in Decision 95-13
for the Stentor operating companies (as they then were), namely a pole rate of $9.60 per
year.
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182.The MEA submitted that, in the event the Commission decides to regulate access to
power utility poles and set a pole rental rate, the price of access should approximate
fair value as closely as possible. The MEA noted that pole rental fees affect electricity
rate payers and submitted that these rate payers should not be penalized by bearing the
cost of a subsidy to the cable television industry.
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183.The MEA submitted that the Commission should focus its pole costing approach on the
net embedded cost of poles. The MEA proposed rating models that would establish rates that
would recover both the incremental costs associated with the cable companies' use of power
utility poles and make a contribution to the capital costs of these support structures.
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184.The CCTA agreed in principle that the cable companies should pay incremental costs
and make a reasonable contribution to capital costs. However, the CCTA disagreed with the
MEA's approach to the actual calculation of incremental and capital costs and,
consequently, the pole rental rate.
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185.In Decision 95-13, the Commission approved rates that covered incremental costs and
provided a contribution to recognize fixed common costs. In the current proceeding, the
Commission notes the CCTA's agreement that users of MEA members' support structures should
also pay rates that recover incremental costs and provide a contribution. The Commission
is also of the view, however, that determining the level of contribution requires, in this
case, an examination of the MEA's evidence regarding its fixed costs.
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186.The Commission notes that in the record of this proceeding, the parties focused
their cost evidence on a typical 40 foot power utility pole. The Commission, therefore,
bases its determinations on the 40 foot Pole Space Model submitted by the MEA. Although
the Respondents' poles vary in size, the Commission's cost estimates and the resulting
annual pole rental rate applies to all poles in the Respondents' territories.
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2.Incremental Costs
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187.The CCTA submitted that, typically, under support structure agreements, a
significant portion of any incremental costs is paid by way of non-recurring charges which
are specific to particular activities. The CCTA added that this has been the case for the
support structure agreements between the cable companies and power utilities in the past
and would continue to be so under either of the contending support structure agreements
advocated by the CCTA and the MEA.
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188.The CCTA considered that, in addition to these non-recurring costs, certain
incremental costs can be viewed as being incurred on an ongoing basis, namely:
administration costs related to the placement of the cable companies' facilities on the
power utility poles and loss in productivity costs resulting from the power utility crews
having to work around the cable companies' facilities. The CCTA noted that these
incremental costs are typically recovered as part of the monthly pole rate. The CCTA
submitted that, based on evidence filed by the telephone companies in previous Commission
proceedings, administration costs for the power utilities should be in the range of $1.80
to $2.40 per year. Based on this same evidence, the CCTA added that the costs associated
with loss in productivity should be in the range of $0.25 to $0.75, and total ongoing
incremental costs should therefore be in the range of $2.05 to $3.15 per year.
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189.The MEA provided an annual estimate of $3.15 per pole for loss of productivity in
utility line work due to the presence of cable attachments on utility poles.
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190.The CCTA submitted that, to the extent that the MEA's loss of productivity cost of
$3.15 is intended to recover all ongoing incremental costs (i.e., both the administration
and loss in productivity as those terms are used by the Commission), it considered the
estimate high but reasonable.
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191.The Commission notes that the CCTA and the MEA agree that loss in productivity
resulting from the power utility crews having to work around the cable companies'
facilities properly constitutes ongoing incremental costs that are typically recovered as
part of the pole rate.
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192.The Commission notes that the CCTA seeks to draw support for its proposed loss of
productivity from several past analyses involving loss of productivity to telephone
companies caused by the presence of cable attachments on telephone company-owned poles.
The Commission considers, however, that use of and costs for telephone company support
structures are not necessarily an appropriate basis for deriving costs for use by a cable
or telecommunications company of electrical utility poles. Further, the CCTA has not
provided any information regarding loss of productivity pertaining to municipal utility
operations. The Commission considers that the MEA's loss of productivity cost of $3.15 is
a reasonable estimate.
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193.The Commission notes that the CCTA stated that administration costs specifically
applicable to the placement of facilities on the MEA members' poles should also be seen as
incremental costs appropriately recoverable through monthly pole rates.
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194.However, the Commission notes that the MEA did not identify such pole-related
administration costs. The MEA has taken a different approach to estimating the
administration costs and has not included an incremental cost specific to pole-only
related administration costs. Absent any specific evidence as to what would constitute a
reasonable incremental cost for pole-related administration costs, the Commission has
derived a $0.62 figure based on the MEA's submission, as discussed further in the
following section.
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195.Based on the foregoing, the Commission considers a figure of $3.77 per pole per
year (that is, $3.15 in loss of productivity and $0.62 in incremental administration
costs) to be a reasonable estimate to recover ongoing incremental costs.
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3. Capital Costs
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196.Based on an estimate of embedded costs obtained by deflating a $1,270 replacement
pole cost using the Consumer Price Index (CPI) over a 25-year period, and assuming an even
distribution of poles, the MEA derives an average embedded cost of $820, a net embedded
cost of $520 and an annual depreciation expense of $32.80.
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197.The CCTA submitted that the MEA's embedded and net embedded cost estimates are too
high. The CCTA added that, as acknowledged by the MEA, these figures are not based on
historical data but are estimates derived from an initial cost which is itself an
estimate. The CCTA considered that no attempt had been made by the MEA to exclude the pole
cost elements which are purely for the benefit of the power utilities (e.g. the cost of
cross arms) or to accommodate the fact that power utility poles are more expensive to
purchase and install than poles which would be installed purely for communications
purposes. The CCTA also considered that, in the present circumstances, the simplest way to
achieve an estimate would be to adopt the costs of the telephone companies.
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198.In reply, the MEA submitted that the accounting practices of the Respondents are
not set up in such a manner that all utilities can supply exact pole costing figures.
However, the MEA stated that its estimates are based on real data supplied by utilities in
question and are not based on five-year-old information obtained from a completely
different industry, as is the case with the CCTA's data. The MEA submitted, moreover, that
the reasonableness of its data is confirmed by the actual data of Milton Hydro. The MEA
also submitted that the Milton Hydro analyses are within 5% to 8% of the estimates
developed by the MEA and validate the reasonableness of the MEA's estimates.
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199.The MEA noted that it agreed with the CCTA claims that items such as cross arms
should be excluded from the capital costs of power utility poles and added that it had
removed such costs from the figures it proposed. The MEA further added that any cost-based
model should be grounded on the costs inherent in the poles in question, i.e., power
utility poles.
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200.In its evidence, the MEA included a 10% Return on Asset Base which is applied
against the net embedded cost of a pole. The CCTA submitted that the inclusion of a 7%
rate would be a more appropriate estimate of the actual annual carrying charge because the
power utilities are municipally controlled entities which can finance debt at less than a
10% rate. In reply, the MEA submitted that the 10% figure represents the return required
by its members for their assets and does not reflect debt, carrying costs or financing
charges.
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201.The MEA also included a 10% administration mark-up on the Depreciation expense and
Return on Asset base. In interrogatory MEA(CCTA) 24Oct97-9, the MEA indicated that this
Administration mark-up is intended to recover additional power utility costs such as a
Commissioner's expense, a general administration expense and office maintenance which are
not reflected in the capital cost of the pole.
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202.In this regard, the CCTA submitted that these types of costs should not be included
when determining the contribution to capital costs payable by the cable companies. The
CCTA submitted that the pole rate should recover the ongoing incremental costs associated
with cable company use of a power utility pole, as well as make a reasonable contribution
to the 217.capital cost of the pole, but is not intended to make a contribution to the
general operating costs of a power utility.
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203.In its evidence, the MEA also included a $20 annual pole maintenance cost in its
calculation of annual capital carrying costs. According to the MEA, this maintenance cost
includes $15 for tree trimming, $3.50 for pole testing and maintenance and $1.50 for pole
straightening.
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204.The CCTA noted that, in interrogatory MEA (CCTA)24Oct 97-6(b), the MEA indicated
that the $15 tree trimming cost includes the cost of trimming at the communications space
level where this task is performed by the power utility on joint use poles. The CCTA added
that at the same time, under past MEA support structure agreements, as well as under the
MEA's proposed new model agreement, the cable companies would be required to pay a
separate charge for all tree trimming at the communications space level, independent of
the monthly pole rate. The CCTA stated that the MEA's maintenance cost should be adjusted
downward to bring it into line with the maintenance costs of the telephone companies
which, according to the CCTA, range between $5.75 to $15.00.
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205.The Commission agrees with the MEA that any cost based model should be established
based on the costs of power utility poles rather than poles designed merely for
communications purposes, and that the cable companies should pay for the use of the poles
available to them.
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206.The Commission notes that the MEA members are not subject to any regulatory
accounting requirements to maintain separate sub-accounts for support structures and, as a
consequence, the accounting costs for poles alone are not available. However, the
Commission also notes that the MEA, to support its estimates of embedded and net embedded
costs of a pole, submitted an analysis of Milton Hydro poles which was appended to the
MEA's 17 October 1997 evidence.
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207.Using an embedded cost of service approach based on utility financial records,
Milton Hydro developed a methodology for determining the full costs associated with
utility overhead lines and the pole component for those lines. From Appendix A of the
Milton Hydro analysis the following figures for poles are available: the net embedded cost
of a pole is $478 and the annual depreciation expense is $31.11.
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208.The Commission notes that, unlike the estimates submitted by the MEA, the evidence
from Milton Hydro is based on financial records to determine pole costs. In the absence of
actual data for the MEA-wide pole population in question, the Commission is of the view
that the Milton Hydro data could serve as a reasonable proxy. Therefore, the Commission
determines that the estimated net embedded cost of $478 and depreciation expense of $31.11
are to be used in the calculation of the pole rental rate.
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209.The Commission considers that the pole rate is not intended to make a contribution
to the general operating costs of a power utility. In the absence of identification by the
MEA of any pole-specific administration-related incremental costs directly related to the
use of power utility poles by the cable companies, the Commission considers that one half
of the MEA's total administration mark-up, amounting to $0.62 annually, will serve as a
reasonable estimate for ongoing incremental pole-related administration costs such as the
costs of issuing permits, administering contracts and, billing and collections.
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210.With regard to the MEA's proposed return on investment rate of 10%, the Commission
notes that in the MEA's 14 April 1997 evidence in support of its rental rate, it described
its proposed 8% Annual Carrying Charge as the annual lost investment opportunity
represented by the installed cost of a 40 foot wood pole. The MEA also stated that its
proposed 8% return on investment is consistent with financial planning practices at
investment, insurance and pension organizations. In the same submission, the MEA also
added that the rate of return presently allowed municipal utilities by Ontario Hydro is
8.5%.
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211.The Commission agrees with the MEA that the owners of power utility pole assets
should be allowed to recover a return on their investment. However, the Commission
considers that the proposed 10% return is not supported by the MEA's evidence in this
matter. In light of the above, the Commission determines that 8.5% is appropriate as a
return on investment rate.
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212.The Commission considers that maintenance costs should exclude tree trimming.
Rather, the power utilities should be permitted to levy a separate charge on cable
companies to reflect tree trimming activities. The Commission considers that this matter
is best left to be resolved by the parties in the first instance. Furthermore, the
Commission notes that in the Milton Hydro study, pole maintenance costs, excluding tree
trimming, are $6.47 ($5.00 for pole testing and $1.47 for straightening). Consistent with
the Commission's determination that the Milton Hydro data should be used in the rate
calculation, maintenance costs of $6.47 will be included in the monthly pole rental rate.
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4.Space Allocation Factor
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213.The CCTA submitted that a factor based on the percentage of usable space consumed
remains the most appropriate means of allocating capital costs. The CCTA also submitted
that under this approach, an allocation factor of 7.4% would be appropriate since the
cable companies use 1 foot out of a total 13.5 feet of usable space on a typical 40 foot
pole. The MEA has proposed two different allocation factors - (i) the Pole Space Model
factor and (ii) the MEA's Glaeser Model factor.
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(i) Pole Space Model
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214.A basic 40 foot joint use pole is described in the MEA's evidence as follows:
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Power space 11.50 ft
Separation space 3.25 ft
Communication space 2.00 ft
Clearance 17.25 ft
Buried 6.00 ft
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215.The MEA Pole Space Model allocation factor is 33% and is obtained by averaging the
allocation factors of 26% and 40% which, in turn, are based on allocations between three
users (cable company, telephone company and power company) and two users (cable company
and power company), respectively. The MEA proposed to allocate the total length of a 40
foot pole such that the user or users of the communications space are responsible for 100%
of the communications space, 100% of the separation space, and a proportionate share
(i.e., 50% or 33% depending on the number of users, as the case may be) of the clearance
and buried portion of the pole.
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216.The CCTA submitted that the allocation of the separation space to a cable company
is not justifiable. The CCTA added that the need for a separation space is caused by the
obligation of the power utilities to comply with Canadian Standards Association (CSA)
standards, which in turn, are intended to address the dangerous nature of the power
utilities facilities. The CCTA does not agree that the cost of clearance space and buried
pole should be shared equally among all support structure users. The CCTA also submitted
that the allocation factor should reflect the benefits and superior rights associated with
pole ownership such that the owner should bear a correspondingly higher share of the
capital costs. In the CCTA's view, the communications space is spare capacity to the power
utilities, and they would be fully compensated for the use of this space if they recovered
any incremental costs which they may incur.
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217.In reply, the MEA submitted that the separation space is necessary only because of
the placement of cable company plant on power utility poles. The MEA added that without
communications attachments a power utility could, in many circumstances, install shorter
poles or use the entire communications and separation space itself. The MEA suggested that
the separation space only exists to protect the communications plant and workers and the
electric power utilities derive no benefit.
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(ii) Glaeser Model
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218.Under the Glaeser Model approach, capital costs are allocated on the basis of the
benefits, measured by the avoided costs to each party realized through joint use poles,
i.e., the capital cost of a pole is allocated according to the relative cost a cable
company would otherwise have to incur. Depending on the number of users, the Glaeser Model
uses the formula C/(C+U) or C/(C+C+U) to determine the allocation factor for a cable
company. In these formulas, C is the cost of a communications pole and U is the cost of a
power utility pole. By averaging the allocation factors which result from these two
formulas, the MEA arrives at a Glaeser Model allocation factor of 35%.
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219.In its final comments, the CCTA submitted that the Glaeser Model fails to
adequately take into account the fact that the power utilities use a higher cost pole. The
CCTA added that the Glaeser Model has never been used to set support structure rates and
in its view, it would be inappropriate for the Commission to use this methodology now. The
CCTA added that this model purports to allocate costs according to relative benefit,
however, it fails to take into account the benefits of ownership.
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220.In reply, the MEA submitted that the Commission should not be dissuaded from
adopting a methodology only because it has never used the model on prior occasions.
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221.The costing approach used by the MEA in developing its proposed $40.53 annual rate
is based on a fully distributed costing methodology which requires the communications
companies to bear the full costs of the communications space, a share of clearance and
buried pole and all of the separation space costs.
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222.The Commission is of the view that in determining the appropriate costs to be
recovered from the cable companies, it is important to consider that they do not have the
rights of ownership of the pole. Accordingly, the Commission considers that the fully
distributed costing approach proposed by the MEA is not appropriate and that an allocation
factor based on the percentage of usable space consumed is more reflective of a user's
actual use and therefore is a more appropriate means of allocating costs. Furthermore, in
light of increasing competition in broadcasting distribution and telecommunications and
the potential for future growth in the number of communications space users, the
Commission is of the view that the expectation that all power utility poles will
accommodate two communications users is reasonable.
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223.The Commission considers that the usable space on a 40 foot power utility pole,
after allowance for clearance and buried pole, is 16.75 feet. Moreover, the Commission is
of the view that the power utilities derive no benefits from the separation space, and
that the separation space is necessary only to protect the employees and attachments of
the communications companies. The Commission agrees with the MEA's comments that, without
communications attachments, the power utilities could use the entire separation and
communications space itself. Therefore, the Commission considers that the separation space
is causal to communications users. Accordingly, the separation space, as well as the
communications space, will be allocated equally between two communications users.
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224.Based on the above, the Commission considers that the cable companies occupy one
foot of the communications space and 1.6 feet of the separation space for a total of 2.6
feet of the 16.75 feet of usable space. Therefore, the Commission determines that the
resulting space allocation to cable companies is 15.5%.
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225.Based on the findings in this decision, the Commission calculates the pole rental
rate as follows:
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Net embedded cost/pole: $ 478.00
Depreciation: 31.11
Interest: 40.63
(8.5% of Net embedded cost/pole)
Maintenance: 6.47
Administration mark-up: N/A
Total capital related costs: 78.21
(Depreciation + Interest + Maintenance)
Cable distribution allocation: 15.5%
(Space Allocation Factor)
Contribution: 12.12
(Total capital related costs x Cable distribution allocation)
Loss in productivity: 3.15
Administration costs: 0.62
Total annual cost/pole: $ 15.89
(Contribution + Loss in productivity + Administrations Costs)
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226.The Commission hereby sets the annual pole rental rate at $15.89 per pole unless
and until parties agree otherwise.
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E.Non-Monetary Terms of the Support Structure Agreement
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227.The CCTA submitted that the cable companies have been unable to reach an agreement
with the power utilities on terms for renewal of the support structure agreements which
expired on or before 31 December 1996. The CCTA added that the appropriate remedy at this
time would be for the Commission to set the pole rate and give the cable companies
permission to access the power utilities' support structures on the same non-monetary
terms as applied in 1996.
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228.The MEA submitted in reply that, if the rate issue is resolved, only five issues of
any significance need to be resolved. In the MEA's view, these can be resolved through
negotiation by the parties and do not require Commission intervention. According to the
MEA, the five issues to be resolved are: fees; signature of plans by a professional
engineer; liability, damages and insurance; vested rights; and assignment.
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229.The MEA added that, contrary to the CCTA's submissions, the expired pole attachment
agreement is no longer viable. The MEA stated that the power utilities had a number of
concerns with the expired 1992 Model Agreement related to issues and problems that were
not addressed or were completely lacking in the expired agreement. The MEA listed a number
of elements of the expired pole attachment agreement which would be problematic if the
Commission attempted to impose the expired contract for future pole attachments. The MEA
stated that these concerns relate directly to the safe, efficient and cost effective
operation of the utility distribution system.
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230.In reply, the CCTA stated that negotiations were promising, at least in respect of
non-monetary terms. However, the CCTA added that they also believe that the completion of
such negotiations would likely take several months while they require access to the poles
of the Respondents' power utilities as soon as possible.
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231.While the Commission is of the view that it has the jurisdiction to set the
non-monetary terms and conditions of access to support structures, it considers that these
matters are best left to negotiations between the parties. Given the MEA's suggestion that
there are only a few issues outstanding, the Commission considers that a new negotiated
pole attachment agreement is likely achievable. However, until such time as a new
agreement is reached, the cable companies need access to the support structures of the
power utilities. Therefore, the Commission directs that the cable companies be granted
access on the same non-monetary terms as set out in the expired support structure
agreement unless and until the parties agree otherwise.
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F. Other Causal Costs Due to Cable Company Attachments on Power Utility Poles
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232.In its evidence, the MEA submitted that, in addition to loss of productivity in
carrying out utility line work around cable company attachments, there are a number of
other causal costs incurred by the utility due to the presence of cable company
attachments on utility poles. The MEA submitted that non-recurring direct charges to be
recovered should be separate from the pole attachment cost.
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233.The MEA submitted that these causal costs vary among utilities and cable companies
according to factors such as local conditions, amount of ongoing work, and cable company
performance. Examples of causal costs subject to direct charges include: extra engineering
time required due to the presence of cable attachments on poles, review of permit
applications, cost to make bonding connections to utility neutral conductor, and the cost
of an initial field inspection to determine feasibility of proposed joint use.
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234.In reply comments, the CCTA submitted that the cable companies have not experienced
significant problems with the respondent power utilities in the past in respect of such
non-recurring charges. The CCTA stated that, while it has not been a central concern in
the present application, the cable companies believe that it is important to emphasize
that the Commission would have jurisdiction under subsection 43(5) of the Act should an
access dispute ever relate to such charges.
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235.The Commission considers that it has the jurisdiction to intervene in any dispute
relating to access to support structures including those relating to the recovery of
non-recurring charges. The Commission considers that the recovery of other causal costs is
best left to be negotiated between individual cable companies and power utilities in the
first instance.
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G.Pole Rental Rate of the PUCs not Represented by the MEA
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236.The PUCs not represented by the MEA within the scope of this proceeding are:
Toronto Hydro-Electric Commission, West Elgin Hydro-Electric Commission; CNP; Chatham
Hydro; Deep River; L'Orignal HEC; Pelham HEC; Plantagenet HEC; and Webbwood HEC. Deep
River and CNP each filed an answer on its own behalf.
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237.The submissions of Deep River and CNP largely objected to the Commission
intervening in this matter while offering little evidence to substantiate pole costs and
the pole rental rate.
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238.However, in its 7 March 1997 submission, CNP stated: "as Rogers believes that
it can seek resolution by the CRTC on contractual matters, we feel justified in requesting
that the CRTC impose a decision on Rogers to accept our last offer of a one year contract
and a very reasonable pole rate of $20.75." However, no specific evidence on
incremental or capital cost elements included in the pole rental rate was submitted by the
power utility. Also, by letter dated 2 April 1997, CNP stated that it was prepared to
await the outcome of the Commission process to determine a rate for the MEA. CNP also
added that it would be further prepared to harmonize its pole rate with the MEA's mediated
rate, provided it deemed it to be fair and equitable.
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239.By letter dated 21 February 1997, Pelham HEC confirmed that it would renew its
expired contract effective 1 January 1997. Pelham HEC also stated that "the pricing
will be as agreed after negotiations with the MEA or a final ruling from the CRTC".
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240.The Commission notes that none of the other respondent PUCs not represented by the
MEA submitted pole costs or rate evidence in this proceeding on their own behalf. The
Commission also notes that the PUCs were aware of the CCTA's application against them and
had an opportunity to participate in the proceeding. Therefore, the Commission determines
that the annual pole rental rate of $15.89 applies to all the Respondents in this
application unless and until the parties agree otherwise.
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Conclusion
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241.The Commission determines that, unless and until the parties agree otherwise, the
cable companies will be granted access on the same terms and conditions as set out in the
individual expired support structure agreements, adjusted so that the annual pole rental
rate, as of the date of this decision, is fixed at $15.89 per pole per year.
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242.With respect to the Toronto Hydro-Electric Commission, the terms and conditions of
past agreements that applied to the Hydro Electric Commission of the City of North York
and the Public Utilities Commission of the City of Scarborough, with the exception of the
pole rate which is fixed at $15.89 per pole per year would, unless and until the parties
agree otherwise, continue to apply in their respective former territories. Similarly, with
respect to the West Elgin Hydro Electric Commission, unless and until the parties agree
otherwise, the cable companies will be granted access on the same terms and conditions as
set out in the expired support structure agreement of the West Lorne Public Utilities
Commission, adjusted so that the pole rate as of the date of this decision, is fixed at
$15.89 per pole per year.
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Secretary General
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This document is available in alternative format upon request and may also be viewed at
the following Internet site:
http://www.crtc.gc.ca
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1.Transactions were authorized in Decision 97-157, 24 April 1997.
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2.As of 1 January 1998, three of the utilities represented by the MEA were dissolved
and reconstituted under provincial legislation. Pursuant to subsection 28(3) of the City
of Toronto Act, 1997, S.O. 1997, c. 2, the Hydro Electric Commission of the City of North
York and the Public Utilities Commission of the City of Scarborough were dissolved. A new
hydroelectric power utility named the Toronto Hydro-Electric Commission was established
pursuant to the above-noted Act. Similarly, the West Lorne Public Utilities Commission was
dissolved by municipal by-law and ministerial order. A new utility was established under
the name of West Elgin Hydro-Electric Commission. These reconstituted entities are not
represented by the MEA.
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3.Criteria for interim relief as set out in Manitoba (Attorney General) v. Metropolitan
Stores Ltd., [1987] 1 S.C.R. 110, as supplemented by RJR MacDonald Inc. v. Canada
(Attorney-General), [1994] 1 S.C.R. 311.
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4.[1989] 1 S.C.R. 641, 58 D.L.R. (4th) 255.
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5.Hogg, Constitutional Law of Canada, p. 15-33.
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6.Telus provides an overview of the jurisprudence relating to the two approaches
applied by the courts in determining whether a federal law may validly affect a provincial
matter. According to Telus, the two approaches that have been applied in the jurisprudence
are: 1) the rational, functional connection test enunciated in Papp v. Papp (1970), 1 O.R.
331 (Ont. C.A.) and applied in R. v. Zelensky, [1978] 2 S.C.R. 940 and in Multiple Access
v. McCutcheon, [1982] 2 S.C.R. 161, and 2) the test as to whether the impugned provision
is truly "necessary" or essential to the operation of the legislative scheme as
enunciated as a dictum in R. v. Thomas Fuller Construction, [1980] 1 S.C.R. 695 and cited
with approval in Regional Municipality of Peel v. MacKenzie, [1982] 2 S.C.R. 9. Telus
notes that Professor Hogg observes that the stipulation that the impugned provision be
"essential" to the legislative scheme is more strict than the rational
connection test and notes that in General Motors v. City National Leasing, [1989] 1 S.C.R.
641, Dickson J. attempted to reconcile these approaches such that "As the seriousness
of the encroachment on provincial powers varies, so does the test required to ensure that
an appropriate constitutional balance is maintained" at p. 671. Telus submits that
under this theory, a court must measure the degree of encroachment of a legislative scheme
on the other government's sphere of power and then determine how necessary the impugned
provision is to the otherwise valid legislative scheme. For minor encroachment, the
rational functional test is appropriate. For major encroachment, a stricter test, such as
the "truly necessary" or "essential" tests apply.
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7.Bell v. Canada (Human Rights Commission), [1996] 3 S.C.R. 854.
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8.As noted by Hogg in Constitutional Law of Canada, at pages 15-12 to 15-16 (1998,
loose-leaf edition), the characterization of a law for constitutional purposes involves
the identification of the "matter" of the law; the matter is often described as
the "pith and substance" of the law, but is perhaps best described as the
dominant or most important characteristic of the law. The process of characterization is
not a technical, formalistic exercise, confined to the strict legal operation of the
impugned law. For example, the fact that a provincial law levies a tax is not decisive of
its classification as a taxing measure. The Court will look beyond the direct legal
effects to inquire into the social or economic purposes which the statute was enacted to
achieve. In determining the purpose of a statute, Hogg states that there is no doubt as to
the propriety of reference to the state of law before the statute and the defect in the
law which the statute purports to correct.
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9.Radio Reference, [1932] A.C. 304; Re CFRB (1973), 3 O.R. 819 (Ont. C.A.); Capital
Cities Communications v. CRTC, [1978] 2 S.C.R. 141; Public Service Board v. Dionne, [1978]
2 S.C.R. 191; Attorney General (Quebec) v. Kellogg's Co., [1978] 2 S.C.R. 211; Irwin Toy
v. Attorney General (Quebec), [1989] 1 S.C.R. 927; and Re Canadian Motion Pictures
Distributors Association et al. and Partners of Viewer's Choice Canada (1996), 68 C.P.R.
(3d) 450 (F.C.A.).
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10.Subsections 91(29) and 92(10)(a) of the Constitution Act, 1867; Toronto v. Bell
Telephone Co., [1905] A.C. 52; Alberta Government Telephones v. CRTC, [1989] 2 S.C.R. 225;
Téléphone Guèvremont Inc. v. Quebec (Régie des Télécommunications), [1994] 1 S.C.R.
878.
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11.Re Oshawa Cable TV Ltd and Town of Whitby (1969), 4 D.L.R. (4th) 224 (Ont H.C.J.)
regarding the constitutional incompetence of a province to regulate the construction and
operation of a cable company's distribution network.
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12.Quebec (Commission du salaire minimum) v. Bell Telephone Co., [1966] S.C.R. 767.
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13.Munro v. National Capital Commission, [1966] S.C.R. 663; Dyke and Cochin Pipe Lines
(1978), 85 D.L.R. (3d) 607 (Sask. C.A.); Re Canadian Motion Pictures Distributors
Association et al. and Partners of Viewer's Choice Canada (1996), 68 C.P.R. (3d) 450
(F.C.A.); Canadian National Railway Co. v. National Transportation Agency, [1996] 1 F.C.
355 (F.C.A.).
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14.Re Ontario Hydro et al., [1993] 3 S.C.R. 327.
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15.Toronto v. Bell Telephone Co., [1905] A.C. 52; Toronto v. Canadian Pacific Railway
Co., [1908] A.C. 540; Canadian Pacific Railway Co. v. Toronto Transportation Commission,
[1930] A.C. 696, [1930] 4 D.L.R. 849 (P.C.); Bell Telephone Company of Canada v. Canadian
National Railway Co., [1933] A.C. 563; Toronto Railway Company v. Toronto, [1920] A.C.
426.
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16.Fulton v. Energy Resources Conservation Board, [1981] 1 S.C.R. 153; section 92A of
the Constitution Act, 1867.
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17.Côté, P.-A., The Interpretation of Legislation in Canada, 2d ed., at pages
219-224.
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18.Stubart Investments Ltd. v. The Queen, [1984] 1 S.C.R. 536.
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19.Dreidger on the Construction of Statutes, 3rd ed., at page 131.
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20.Dreidger, supra, at page 427.
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21.Canadian Pacific Railway Co. v. Toronto Transportation Commission, [1930] A.C. 696,
[1930] 4 D.L.R. 849 (P.C.); Bell Telephone Co. v. Canadian National Railway, [1933] A.C.
563; Canadian Electrical Association v. Canadian National Railway, [1934] C.R.C. 162
(P.C.); Canadian National Railway Co. v. Bell Telephone Co., [1939] S.C.R. 308; Canadian
Pacific Railway Co. v. Attorney-General (Quebec), [1965] S.C.R. 602; Toronto Railway
Company v. Toronto, [1920] A.C. 426.
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22.Convergence - Competition and Cooperation - Policy and Regulation Affecting Local
Telephone and Cable Networks, Report of the Co-Chairs of the Local Networks Convergence
Committee, at page 63.
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23.See, for instance, Transvision (Magog) Inc. v. Bell Canada, [1975] C.T.C. 463.
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24.Supra, note 22, at page 65.
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25.Supra, note 22, at page 66.
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26.Supra, note 22, at page 67.
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27.Proceedings before the Standing Senate Committee on Transport and Communications,
Senate of Canada, Issue No. 27 (June 22, 1992), at 27:36.
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28.Subsection 43(1) provides that in sections 43 and 44, "distribution
undertaking'' has the same meaning as in subsection 2(1) of the Broadcasting Act.
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29.Bell Canada, Tariff for the Use of Support Structures by Cable Television Licensees,
Telecom Decision CRTC 77-6, dated 27 May
1977.
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30.See, for example, Review of Regulatory Framework, Telecom Decision CRTC 94-19, dated 16 September 1994;
Competition and Culture on Canada's Information Highway: Managing the Realities of
Transition, 19 May 1995; Implementation of Regulatory Framework - Co-location, Telecom
Public Notice CRTC 95-13, dated 20 March
1995; Implementation of Regulatory Framework - Local Interconnection and Network Component
Unbundling, Telecom Public Notice CRTC 95-36,
dated 11 July 1995; Implementation of Regulatory Framework - Local Number Portability and
Related Issues, Telecom Public Notice CRTC 95-48,
dated 10 November 1995; Local Competition, Telecom Decision CRTC 97-8, dated 1 May 1997; Forbearance -
Regulation of Toll Services Provided by Incumbent Telephone Companies, Telecom Decision CRTC 97-19, dated 18 December 1997; Stentor
Resource Centre Inc. - Forbearance from Regulation of Interexchange Private Line Services,
Telecom Decision CRTC 97-20, 18 December
1997; Implementation of Price Cap Regulation and Related Issues, Telecom Decision CRTC 98-2, dated 5 March 1998; Local Pay
Telephone Competition, Telecom Decision CRTC
98-8, dated 30 June 1998; Regulation under the Telecommunications Act of Certain
Telecommunications Services Offered by Broadcast Carriers, Telecom Decision CRTC 98-9, dated 9 July 1998; Review of
Contribution Regime of Independent Telephone Companies in Ontario and Quebec, Telecom
Decision CRTC 99-5, dated 21 April 1999.
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31.New Regulatory Framework for Broadcasting Distribution Undertakings, Public Notice CRTC 1997-25, dated 11 March 1997; Broadcasting
Distribution Regulations, Public Notice CRTC
1997-150, 22 December 1997.
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32.British Columbia Telephone Company v. CRTC, 28 June 1991, File No. 91-A-1800 and
91-A-1920 (F.C.A.), leave to appeal denied on interlocutory ruling of 16 May 1992, CRTC
Exhibit No. 6, in the proceeding leading to Decision 92-12; cf. Section 336 of the former
Railway Act.
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33.The Commission notes that its jurisdiction to resolve access disputes under
subsection 43(5) is to be contrasted with the Commission's ongoing regulation of access to
supporting structures of telephone companies which has not been based on subsection 43(5)
of the Act. In the proceeding leading up to Telecom Decision 95-13, it was argued that the
Commission should not render a general decision with regard to access to telephone company
support structures and that access to such structures should only be governed by the
specific regime provided at subsection 43(5) of the Act. The Commission concluded that
access to telephone company support structures is a "telecommunications service"
within the meaning of the Act. Accordingly, the Commission rejected the argument that its
jurisdiction with respect to such access is governed only by subsection 43(5). Rather, in
prescribing the rates, terms and conditions set out in Decision 95-13, the Commission
relied on the provisions of the Act generally applicable to telecommunications services,
including sections 24, 25 and 27. This is the approach adopted by the Commission
previously under the Railway Act, and which was approved by the Supreme Court of Canada in
British Columbia Telephone Company v. Shaw Cable Systems (B.C.) Ltd., [1995] 2 S.C.R. 739,
at pages 760-766.
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34.See s. 43(2), 43(3), 43(4), 44, 67(1)(a), and 76(2) of the Act.
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35.In this regard, the Commission notes that in Transvision (Magog) Inc. v. Bell
Canada, supra, the Canadian Transport Commission (CTC) concluded that telephone company
poles ceased to be pure private property. The CTC stated that the use and enjoyment Bell
had of its property was subject to certain limitations imposed by law in the public
interest. It also stated that when one devotes one's property to a use in which the public
has an interest, one, in effect, grants to the public an interest in that use, and must
submit to be controlled by the public for the common good, to the extent of the interest
one has thus created.
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36.Fenn v. Peterborough (City) (1979), 25 O.R. (2d) 399 (Ont. C.A.); affirmed by the
Supreme Court of Canada in Consumers Gas Co. et al v. Fenn et al, [1981] 2 S.C.R. 613.
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37.In the Matter of an Application under Rule 14.05(3) by Sudbury Hydro-Electric
Commission for an Interpretation of Subsection 50(3) and Subsection 50(5) of the Planning
Act, R.S.O. 1990, c. P.13 (1996), 29 O.R. (3d) 23 (Gen. Div.)
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ATTACHMENT A
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LIST OF RESPONDENTS
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1.Barrie Public Utilities Commission
2.Canadian Niagara Power
3.Chatham Hydro
4.Clarington Hydro Electric Commission
5.The Hydro Electric Commission of the Town of Deep River
6.The Police Village of Embrun Hydro System
7.Essex Public Utilities Commission
8.Guelph Hydro
9.Hydro-Electric Commission of Cambridge and North Dumfries
10.Innisfil Hydro
11.Hydro Electric Commission of Kitchener-Wilmot
12.L'Orignal Hydro Electric Commission
13.Leamington Public Utilities Commission
14.Markham Hydro Electric Commission
15.Mississauga Hydro Electric Commission
16.Niagara-on-the-Lake Hydro Electric Commission
17.The Hydro Electric Commission of North Bay
18.Oakville Hydro
19.Orillia Water, Light and Power
20.Pelham Hydro-Electric Commission
21.Perth Public Utilities Commission
22.Pickering Hydro
23.Plantagenet Hydro Electric Commission
24.Public Utilities Commission of the Village of Port Stanley
25.Public Utilities Commission of the Town of Paris
26.Richmond Hill Hydro Electric Commission
27.Shelburne Hydro
28.Stoney Creek Hydro-Electric Commission
29.Stratford Public Utility Commission
30.Toronto Hydro-Electric Commission (formerly Hydro Electric Commission of the City of
North York and the Public Utilities Commission of the City of Scarborough)
31.Hydro Electric Commission of Waterloo, Wellesley, and Woolwich
32.Webbwood Hydro Electric Commission
33.West Elgin Hydro-Electric Commission (formerly West Lorne Public Utilities Commission)
34.The Public Utilities Commission of the Township of Zorra
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