Creates standards by which the public service commission reviews and approves a merger or acquisition between telephone corporations, cable corporations and combination telephone and cable corporations.
STATE OF NEW YORK
________________________________________________________________________
1223--D
2015-2016 Regular Sessions
IN ASSEMBLY
January 8, 2015
___________
Introduced by M. of A. BRENNAN, PRETLOW, KAVANAGH, GUNTHER, LUPARDO,
COLTON, ENGLEBRIGHT, LIFTON, CAHILL, ROBINSON, MAGNARELLI, ABINANTI,
BENEDETTO, GOLDFEDER, JAFFEE, PAULIN, ABBATE, ORTIZ, STIRPE, ROSEN-
THAL, MILLER, WEPRIN, SKOUFIS, BARRETT, STECK, BRINDISI, SEPULVEDA,
DINOWITZ, SEAWRIGHT, OTIS, MAYER, SANTABARBARA, ARROYO, RICHARDSON,
FAHY, BICHOTTE, BARRON, DAVILA, COOK, HUNTER -- Multi-Sponsored by --
M. of A. BUCHWALD, CERETTO, CRESPO, CROUCH, CYMBROWITZ, DenDEKKER,
GALEF, GLICK, GOTTFRIED, HEVESI, HOOPER, LENTOL, LOPEZ, LUPINACCI,
MARKEY, McDONALD, McDONOUGH, MOSLEY, MURRAY, PEOPLES-STOKES, PERRY,
QUART, RAIA, RAMOS, SCHIMEL, SIMON, SIMOTAS, SOLAGES, THIELE, TITONE
-- read once and referred to the Committee on Corporations, Authori-
ties and Commissions -- committee discharged, bill amended, ordered
reprinted as amended and recommitted to said committee -- again
reported from said committee with amendments, ordered reprinted as
amended and recommitted to said committee -- recommitted to the
Committee on Corporations, Authorities and Commissions in accordance
with Assembly Rule 3, sec. 2 -- committee discharged, bill amended,
ordered reprinted as amended and recommitted to said committee --
reported and referred to the Committee on Codes -- reported and
referred to the Committee on Ways and Means -- committee discharged,
bill amended, ordered reprinted as amended and recommitted to said
committee
AN ACT to amend the public service law, in relation to creating stand-
ards by which the public service commission reviews and approves a
merger or acquisition between telephone corporations, cable corpo-
rations, and combination telephone and cable corporations
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. The public service law is amended by adding a new article
2 12 to read as follows:
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD02448-10-6
A. 1223--D 2
1 ARTICLE 12
2 PROVISIONS RELATING TO TELEPHONE CORPORATIONS, CABLE
3 CORPORATIONS, AND COMBINATION TELEPHONE AND CABLE
4 CORPORATIONS
5 Section 250. Definitions.
6 251. Mergers or acquisitions.
7 § 250. Definitions. The words and phrases used in this article shall
8 have the following meanings:
9 1. "Cable corporation" shall mean any person owning, controlling,
10 operating, managing or leasing one or more cable television systems
11 within the state.
12 2. "Cable system" shall have the same meaning as set forth in section
13 two hundred twelve of this chapter.
14 3. "Combination telephone and cable corporation" shall mean any tele-
15 phone corporation operating in New York under common ownership with a
16 cable corporation operating in New York or any cable corporation operat-
17 ing in New York under common ownership with a telephone corporation
18 operating in New York, or any successor of either corporation.
19 § 251. Mergers or acquisitions. 1. (a) No telephone corporation, cable
20 corporation, or combination telephone and cable corporation that has
21 gross annual revenues exceeding one hundred million dollars shall
22 assign, transfer control of or merge its stock, franchise or system or
23 any part of such system to any other person or corporation without the
24 written consent of the commission.
25 (b) Notwithstanding any other section of law, no consent, as required
26 by paragraph (a) of this subdivision, shall be given by the commission
27 to the assignment, transfer of control or merger of any right or fran-
28 chise to operate a telephone line or any cable television system unless
29 it shall have been shown by the parties that such assignment, transfer
30 of control or merger is in the public interest.
31 (c) No consent, as required by paragraph (a) of this subdivision,
32 shall be given by the commission to the assignment, transfer of control
33 or merger of any right or franchise to operate any part of a telephone
34 or cable corporation's system, or to a contract for the operation of
35 such entity's system, unless it shall have been shown by the parties
36 that such assignment, transfer of control, merger or contract is in the
37 public interest.
38 2. Before consenting to the assignment, transfer of control or merger
39 of any telephone corporation, cable corporation, or combination tele-
40 phone and cable corporation pursuant to subdivision one of this section
41 the commission shall find that the proposal does all of the following:
42 (a) Provides public interest benefits to the affected subscribers.
43 (b) Maintains or improves the service quality standards the commission
44 has established for the affected telephone corporation, cable corpo-
45 ration, or combination telephone and cable corporation.
46 (c) Maintains or improves the financial condition of the resulting
47 telephone corporation, cable corporation, or combination telephone and
48 cable corporation doing business in the state.
49 (d) Maintains or improves the telephone corporation, cable corpo-
50 ration, or combination telephone and cable corporation service offerings
51 to subscribers in the state.
52 (e) Maintains or improves the quality of management of the resulting
53 telephone corporation, cable corporation, or combination telephone and
54 cable corporation doing business in the state.
A. 1223--D 3
1 (f) Is fair and reasonable to affected telephone corporation, cable
2 corporation, or combination telephone and cable corporation employees,
3 including both union and nonunion employees.
4 (g) Does not adversely affect competition in the marketplace for tele-
5 phone or cable services.
6 (h) Creates enforcement measures when a telephone corporation, cable
7 corporation, or combination telephone and cable corporation fails to
8 comply with any conditions or commitments made to the commission in
9 order to obtain commission consent. The commission shall be authorized
10 to compel performance, issue penalties or order implementation of such
11 conditions or commitments.
12 (i) Equitably allocates the forecasted positive benefits of the
13 proposal between shareholders and subscribers, including but not limited
14 to, the forecasted economic benefits. Subscribers shall receive not less
15 than fifty percent of such forecasted positive benefits. For the purpose
16 of allocating the forecasted positive benefits of the proposal between
17 shareholders and subscribers, the commission may deem, including but not
18 limited to, reinvestment of the forecasted benefits into the telephone
19 corporation, cable corporation, or combination telephone and cable
20 corporation's infrastructure as a benefit received by subscribers.
21 (j) Creates a program to provide services to low-income subscribers,
22 who shall include but not be limited to families participating in the
23 national school lunch program, citizens receiving benefits from the
24 supplemental security income assistance program, participants in the
25 home energy assistance program, and participants receiving the lifeline
26 discount on an eligible telecommunications service, at reasonable rates.
27 3. When reviewing an assignment, transfer of control or merger
28 proposal, as set forth in subdivision one of this section, the commis-
29 sion shall consider reasonable alternatives or modifications to the
30 proposal as recommended by other parties to determine whether or not the
31 proposal is in the public interest.
32 4. The person or corporation seeking acquisition or control of a tele-
33 phone corporation, cable corporation, or combination telephone and cable
34 corporation shall have before the commission the burden of proving by a
35 preponderance of the evidence that the requirements of subdivision two
36 of this section are satisfied.
37 5. In determining whether or not an acquisition of a telephone corpo-
38 ration, cable corporation, or combination telephone and cable corpo-
39 ration has the gross annual revenues exceeding the amount specified in
40 subdivision two of this section, the revenues of that telephone or cable
41 corporation's affiliates shall not be considered, unless the affiliate
42 is to be utilized for the purpose of effecting such merger, acquisition,
43 or control.
44 6. Paragraphs (a), (b), and (c) of subdivision two of this section
45 shall not apply to the formation of a holding company.
46 7. Paragraphs (a), (b), and (c) of subdivision two of this section
47 shall not apply to acquisitions or changes in control that are mandated
48 by either the commission or the legislature.
49 8. When issuing a decision on a proposed assignment, transfer of
50 control or merger proposal, as required by subdivision one of this
51 section, the commission shall issue a report detailing how that decision
52 was reached within thirty days of issuing such decision. If the commis-
53 sion grants conditional approval in its decision, the department shall
54 issue an additional report within one year after granting such condi-
55 tional approval detailing the corporation's compliance with such condi-
A. 1223--D 4
1 tions or commitments. Nothing in this section shall preclude the depart-
2 ment from issuing additional reports on the corporation's compliance.
3 9. (a) Any consent required by paragraph (a) of subdivision one of
4 this section shall only be provided by the commission after a full
5 evidentiary hearing.
6 (b) Such full evidentiary hearing shall be live streamed on the inter-
7 net and archived on the department website for public viewing.
8 10. (a) Any consent required by paragraph (a) of subdivision one of
9 this section shall only be issued by the commission after a public hear-
10 ing where members of the public may provide the commission or its desig-
11 nee with comments on the proposal.
12 (b) The commission shall announce the public hearing at least thirty
13 days before the date of the public hearing and shall publish such notice
14 on its website at least thirty days before the public hearing.
15 (c) The public hearing shall be no less than fifteen days before a
16 consent on the proposal is issued by the commission.
17 11. The commission shall issue a written "finding of fact" as to all
18 of the findings required in subdivision two of this section, and it
19 shall include but not be limited to:
20 (a) an explanation of how the department determined the "forecasted
21 economic benefits" in paragraph (i) of subdivision two of this section
22 and specifically set forth in an itemized manner how subscribers are
23 intended to receive not less than fifty percent of such forecasted
24 economic benefits, and
25 (b) a rationale as to why the commission has consented to the partic-
26 ular distribution of such forecasted economic benefits between the
27 subscribers and shareholders. Such finding of fact shall be issued at
28 least thirty days prior to the commission issuing a consent order pursu-
29 ant to subdivision one of this section and shall be posted on the
30 commission's website.
31 12. (a) Any review of a merger or acquisition by the public service
32 commission pursuant to this section shall be in addition to any other
33 review by the public service commission required by this chapter unless
34 otherwise deemed by the commission.
35 (b) Any consent or approval of a merger or acquisition by the public
36 service commission issued pursuant to this section shall not be consid-
37 ered an approval or consent of the public service commission required by
38 any other section of this chapter unless otherwise deemed by the commis-
39 sion.
40 13. The commission shall comply with the requirements established in
41 this section to the fullest practicable extent. If any of the require-
42 ments conflict with the requirements or schedule set forth by the feder-
43 al communications commission, the commission may modify the requirements
44 to achieve compliance.
45 § 2. Severability clause. If any clause, sentence, paragraph, subdivi-
46 sion, section or part of this act shall be adjudged by any court of
47 competent jurisdiction to be invalid, such judgment shall not affect,
48 impair, or invalidate the remainder thereof, but shall be confined in
49 its operation to the clause, sentence, paragraph, subdivision, section
50 or part thereof directly involved in the controversy in which such judg-
51 ment shall have been rendered. It is hereby declared to be the intent of
52 the legislature that this act would have been enacted even if such
53 invalid provisions had not been included herein.
54 § 3. This act shall take effect immediately.
