To amend the Clayton Act to ensure the application of the antitrust laws to local telephone monopolies; and for other purposes.

May 3, 2001

Mr. CONYERS (for himself, Mr. CANNON, Mr. NADLER, and Mr. ISSA) introduced the following bill; which was referred to the Committee on the Judiciary, and in addition to the Committee on Energy and Commerce, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned

To amend the Clayton Act to ensure the application of the antitrust laws to local telephone monopolies; and for other purposes.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

This Act may be cited as the `Broadband Competition and Incentives Act of 2001'.

TITLE I--PROTECTION OF BROADBAND SERVICES FROM CONTINUING MONOPOLIZATION

SEC. 101. AMENDMENT TO THE CLAYTON ACT TO INCLUDE MARKET POWER ENTRY TEST.

The Clayton Act (15 U.S.C. 15 et seq.) is amended by adding at the end the following:

`SEC. 28. BROADBAND TELECOMMUNICATIONS SERVICES.

`(a) DETERMINATION BY ATTORNEY GENERAL- A Bell operating company or an affiliate of a Bell operating company may not provide interLATA services in any of its in-region States under the authority of any amendments to section 271 of the Communications Act of 1934 (47 U.S.C. 271) enacted after April 24, 2001, unless the Attorney General of the United States determines that such company or such affiliate does not have market power in the provision of wireline telephone exchange service in the State involved.

`(b) MARKET POWER- For purposes of this section, a Bell operating company or an affiliate of a Bell operating company shall be deemed to have market power in the provision of wireline telephone exchange service in the State involved if such company or such affiliate provides service to more than 85 percent of the business subscribers, or more than 85 percent of the residential subscribers, in such State at the time such company or such affiliate requests that the Attorney General make a determination under subsection (a).

`(c) DEFINITIONS- For purposes of this section:

`(1) AFFILIATE- The term `affiliate' means a person that (directly or indirectly) owns or controls, is owned or controlled by, or is under common ownership or control with, another person. For purposes of this paragraph, the term `own' means to own an equity interest (or equivalent thereof) of more than 10 percent.

`(2) BELL OPERATING COMPANY- The term `Bell operating company' has the meaning given such term in section 3 of the Communications Act of 1934 (47 U.S.C. 153).'.

TITLE II--BROADBAND DEPLOYMENT INCENTIVES FOR SERVICES TO ELIGIBLE RURAL COMMUNITIES AND UNDERSERVED AREAS

SEC. 201. ELIMINATION OF DISCRIMINATORY TAXES ON BROADBAND SERVICE PROVIDERS.

(a) PROHIBITION- No State or political subdivision of a State may impose--

(1) discriminatory taxes on broadband services; or

(2) a tax or fee imposed on telecommunications carriers or affiliates thereof, other than incumbent local exchange carriers and affiliates thereof, for the use of public rights-of-way that is greater than the tax or fee imposed on incumbent local exchange carriers or affiliates thereof for their use of public rights-of-way.

(b) LIABILITIES AND PENDING CASES- Subsection (a) shall not affect liability for taxes or fees accrued and enforced before the date of the enactment of this Act or to ongoing litigation relating to such taxes or such fees.

SEC. 202. LOAN PROGRAM FOR ELIGIBLE RURAL COMMUNITIES AND FOR UNDERSERVED COMMUNITIES.

(a) AUTHORITY TO MAKE DIRECT LOANS AND LOAN GUARANTEES- The Attorney General of the United States may make direct loans or loan guarantees to eligible broadband service providers in accordance with this section to finance the deployment of broadband services to eligible rural communities and to underserved areas.

(b) ELIGIBILITY REQUIREMENTS- To be eligible to receive a loan or loan guarantee under this section, a broadband service provider shall submit to the Attorney General an application containing such information and assurances as the Attorney General may require by rule, including--

(1) information demonstrating that such provider is capable of delivering broadband service;

(2) a description of the proposed project to deploy broadband service to an eligible rural community or to an underserved area where broadband service is not otherwise generally available throughout such community or such area; and

(3) an assurance that such provider will meet the standards for service and area wide coverage established by the Attorney General.

(c) TERMS AND CONDITIONS- Direct loans and loan guarantees made under this section--

(1) shall be made available in accordance with the requirements of the Federal Credit Reform Act of 1990 (2 U.S.C. 661 et seq.);

(2) in the case of direct loans and loans guaranteed, shall bear interest at an annual rate of not more than 2 percent per annum; and

(3) shall be made for the longer of--

(A) a term of 30 years; or

(B) the useful life of the assets constructed, reconstructed, or acquired with any

part of the proceeds of such loan or of the loan guaranteed.

(d) LIMITATIONS-

(1) TECHNOLOGY NEUTRALITY- In making direct loans and loan guarantees under this section, the Attorney General may not take into consideration the technology proposed to be employed by the applicants for such loans or such guarantees.

(2) SECURITY INTEREST- The Attorney General may take a security interest in assets or revenue streams, in connection with a direct loan or loan guarantee made under this section, of not more than the amount sufficient to cover the assets financed by such loan or such guarantee.

(e) AUTHORIZATION OF APPROPRIATIONS- There is authorized to be appropriated to the Attorney General to carry out this section $3,000,000,000 for fiscal years 2002, 2003, 2004, 2005, and 2006.

SEC. 203. DEFINITIONS.

(a) IN GENERAL- In this title:

(1) AFFILIATE- Term `affiliate' means a person that (directly or indirectly) owns or controls, is owned or controlled by, or is under common ownership or control with, another person. For purposes of this paragraph, the term `own' means to own an equity interest (or equivalent thereof) of more than 10 percent.

(2) ASSESSMENT- The term `assessment' means valuation for a property tax levied by a taxing State or political subdivision thereof.

(3) ASSESSMENT JURISDICTION- The term `assessment jurisdiction' means a geographical area in a State used in determining the assessed value of property for ad valorem taxation.

(4) BROADBAND SERVICE- The term `broadband service' includes, without regard to any particular transmission medium or technology, high-speed, switched, broadband telecommunications capable of delivering not less than 1.5 megabits of data per second to the user and 128,000 bits of data per second from the user that enables users to originate and receive high-quality voice, data, graphics, and video telecommunications.

(5) COMMERCIAL BUSINESS- The term `commercial business' means a business, other than a broadband service provider, devoted to a commercial use.

(6) COMMERCIAL PROPERTY- The term `commercial property' means property, other than property owned by a broadband service provider, devoted to a commercial use.

(7) DISCRIMINATORY TAX- The term `discriminatory tax' means any tax imposed by a State or political subdivision of a State on a broadband service provider that--

(A) uses an assessment of property owned by broadband service providers at a value that has a higher ratio to the true market value of the broadband service provider's property than the ratio that the assessed value of other commercial property in the same assessment jurisdiction has to the true market value of the other commercial property value;

(B) uses an assessment of property owned by broadband service providers at a value that encompasses factors other than tangible assets, such as intangible assets and a going concern component, and bases the assessed value of other commercial property on a local assessment process of only tangible assets;

(C) is not generally imposed and legally collectible by such State or such political subdivision on commercial businesses; or

(D) is imposed without 180 days advance notification of the imposition of such tax.

(8) ELIGIBLE RURAL COMMUNITY- The term `eligible rural community' means any census tract which--

(A) is not within 10 miles of any incorporated or unincorporated place containing more than 25,000 people, and

(B) is not within a county or county equivalent which has an overall population density of more than 500 people per square mile of land.

(9) INCUMBENT LOCAL EXCHANGE CARRIER- The term `incumbent local exchange carrier' means, with respect to an area, the local exchange carrier that--

(A) on the date of enactment of this Act, is providing telephone exchange service in such area; and

(B)(i) is deemed to be a member of the exchange carrier association pursuant to section 69.601(b) of title 47 of the Code of Federal Regulations, as in effect on such date; or

(ii) on or after such date, is a successor or assign of a member described in clause (i).

(10) TAX- The term `tax' has the meaning given such term in section 1104 of the Internet Tax Freedom Act (47 U.S.C. 151 note).

(11) TELECOMMUNICATIONS CARRIER- The term `telecommunications carrier' has the meaning given such term by section 3(44) of the Communications Act of 1934 (47 U.S.C. 153 (44)), but--

(A) includes all members of an affiliated group of which a telecommunications carrier is a member, and

(B) does not include a commercial mobile service carrier.

(12) UNDERSERVED AREA- The term `underserved area' means any census tract which is located in--

(A) an empowerment zone or enterprise community designated under section 1391 of the Internal Revenue Code of 1986;

(B) the District of Columbia Enterprise Zone established under section 1400 of such Code;

(C) a renewal community designated under section 1400E of such Code; or

(D) a low-income community designated under section 45D of such Code.

(b) DESIGNATION OF CENSUS TRACTS- The Secretary of the Treasury shall, not later than 90 days after the date of the enactment of this Act, designate and publish those census tracts meeting the criteria described in paragraphs (8) and (12) of subsection (a).

END