Illinois General Assembly - Full Text of HB3808
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Full Text of HB3808  103rd General Assembly




HB3808 EnrolledLRB103 30973 AMQ 57562 b

1    AN ACT concerning regulation.
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
4    Section 5. The Public Utilities Act is amended by changing
5Sections 21-201 and 21-801 as follows:
6    (220 ILCS 5/21-201)
7    (Section scheduled to be repealed on December 31, 2026)
8    Sec. 21-201. Definitions. As used in this Article:
9    (a) "Access" means that the cable or video provider is
10capable of providing cable services or video services at the
11household address using any technology, other than
12direct-to-home satellite service, that provides 2-way
13broadband Internet capability and video programming, content,
14and functionality, regardless of whether any customer has
15ordered service or whether the owner or landlord or other
16responsible person has granted access to the household. If
17more than one technology is used, the technologies shall
18provide similar 2-way broadband Internet accessibility and
19similar video programming.
20    (b) "Basic cable or video service" means any cable or
21video service offering or tier that includes the
transmission of local television broadcast signals.
23    (c) "Broadband service" means a high speed service



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1connection to the public Internet capable of supporting, in at
2least one direction, a speed in excess of 200 kilobits per
3second (kbps) to the network demarcation point at the
4subscriber's premises.
5    (d) "Cable operator" means that term as defined in item
6(5) of 47 U.S.C. 522.
7    (e) "Cable service" means that term as defined in item (6)
8of 47 U.S.C. 522.
9    (f) "Cable system" means that term as defined in item (7)
10of 47 U.S.C. 522.
11    (g) "Commission" means the Illinois Commerce Commission.
12    (h) "Competitive cable service or video service provider"
13means a person or entity that is providing or seeks to provide
14cable service or video service in an area where there is at
15least one incumbent cable operator.
16    (i) "Designated market area" means a designated market
17area, as determined by Nielsen Media Research and published in
18the 1999-2000 Nielsen Station Index Directory and Nielsen
19Station Index United States Television Household Estimates or
20any successor publication. For any designated market area that
21crosses State lines, only households in the portion of the
22designated market area that is located within the holder's
23telecommunications service area in the State where access to
24video service will be offered shall be considered.
25    (j) "Footprint" means the geographic area designated by
26the cable service or video service provider as the geographic



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1area in which it will offer cable services or video services
2during the period of its State-issued authorization. Each
3footprint shall be identified in terms of either (i)
4exchanges, as that term is defined in Section 13-206 of this
5Act; (ii) a collection of United States Census Bureau Block
6numbers (13 digit); (iii) if the area is smaller than the areas
7identified in either (i) or (ii), by geographic information
8system digital boundaries meeting or exceeding national map
9accuracy standards; or (iv) local units of government.
10    (k) "Holder" means a person or entity that has received
11authorization to offer or provide cable or video service from
12the Commission pursuant to Section 21-401 of this Article.
13    (l) "Household" means a house, an apartment, a mobile
14home, a group of rooms, or a single room that is intended for
15occupancy as separate living quarters. Separate living
16quarters are those in which the occupants live and eat
17separately from any other persons in the building and that
18have direct access from the outside of the building or through
19a common hall. This definition is consistent with the United
20States Census Bureau, as that definition may be amended
22    (m) "Incumbent cable operator" means a person or entity
23that provided cable services or video services in a particular
24area under a franchise agreement with a local unit of
25government pursuant to Section 11-42-11 of the Illinois
26Municipal Code (65 ILCS 5/11-42-11) or Section 5-1095 of the



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1Counties Code (55 ILCS 5/5-1095) on January 1, 2007.
2    (n) "Local franchising authority" means the local unit of
3government that has or requires a franchise with a cable
4operator, a provider of cable services, or a provider of video
5services to construct or operate a cable or video system or to
6offer cable services or video services under Section 11-42-11
7of the Illinois Municipal Code (65 ILCS 5/11-42-11) or Section
85-1095 of the Counties Code (55 ILCS 5/5-1095).
9    (o) "Local unit of government" means a city, village,
10incorporated town, or county.
11    (p) "Low-income household" means those residential
12households located within the holder's existing telephone
13service area where the average annual household income is less
14than $35,000, based on the United States Census Bureau
15estimates adjusted annually to reflect rates of change and
17    (q) "Public rights-of-way" means the areas on, below, or
18above a public roadway, highway, street, public sidewalk,
19alley, waterway, or utility easements dedicated for compatible
21    (r) "Service" means the provision of cable service or
22video service to subscribers and the interaction of
23subscribers with the person or entity that has received
24authorization to offer or provide cable or video service from
25the Commission pursuant to Section 21-401 of this Act.
26    (s) "Service provider fee" means the amount paid under



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1Section 21-801 of this Act by the holder to a municipality, or
2in the case of an unincorporated service area to a county, for
3service areas within its territorial jurisdiction, but under
4no circumstances shall the service provider fee be paid to
5more than one local unit of government for the same portion of
6the holder's service area.
7    (t) "Telecommunications service area" means the area
8designated by the Commission as the area in which a
9telecommunications company was obligated to provide
10non-competitive local telephone service as of February 8, 1996
11as incorporated into Section 13-202.5 of this Act.
12    (u) "Video programming" means that term as defined in item
13(20) of 47 U.S.C. 522.
14    (v) "Video service" means video programming provided by a
15video service provider and subscriber interaction, if any,
16that is required for the selection or use of such video
17programming services, and that is provided through wireline
18facilities located at least in part in the public
19rights-of-way without regard to delivery technology, including
20Internet protocol technology. This definition does not include
21the following: (1) any video programming provided by a
22commercial mobile service provider defined in subsection (d)
23of 47 U.S.C. 332; (2) direct-to-home satellite services
24defined in subsection (v) of 47 U.S.C. 303; or (3) any video
25programming provided solely as part of, and accessed via a ,
26service that enables users to access content, information,



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1electronic mail, or other services offered over the public
2Internet, including Internet streaming content.
3(Source: P.A. 100-20, eff. 7-1-17.)
4    (220 ILCS 5/21-801)
5    (Section scheduled to be repealed on December 31, 2026)
6    Sec. 21-801. Applicable fees payable to the local unit of
8    (a) Prior to offering cable service or video service in a
9local unit of government's jurisdiction, a holder shall notify
10the local unit of government. The notice shall be given to the
11local unit of government at least 10 days before the holder
12begins to offer cable service or video service within the
13boundaries of that local unit of government.
14    (b) In any local unit of government in which a holder
15offers cable service or video service on a commercial basis,
16the holder shall be liable for and pay the service provider fee
17to the local unit of government. The local unit of government
18shall adopt an ordinance imposing such a fee. The holder's
19liability for the fee shall commence on the first day of the
20calendar month that is at least 30 days after the holder
21receives such ordinance. For any such ordinance adopted on or
22after the effective date of this amendatory Act of the 99th
23General Assembly, the holder's liability shall commence on the
24first day of the calendar month that is at least 30 days after
25the adoption of such ordinance. The ordinance shall be sent by



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1mail, postage prepaid, to the address listed on the holder's
2application provided to the local unit of government pursuant
3to item (6) of subsection (b) of Section 21-401 of this Act.
4The fee authorized by this Section shall be 5% of gross
5revenues or the same as the fee paid to the local unit of
6government by any incumbent cable operator providing cable
7service. The payment of the service provider fee shall be due
8on a quarterly basis, 45 days after the close of the calendar
9quarter. If mailed, the fee is considered paid on the date it
10is postmarked. Except as provided in this Article, the local
11unit of government may not demand any additional fees or
12charges from the holder and may not demand the use of any other
13calculation method other than allowed under this Article.
14    (c) For purposes of this Article, "gross revenues" means
15all consideration of any kind or nature, including, without
16limitation, cash, credits, property, and in-kind contributions
17received by the holder for the operation of a cable or video
18system to provide cable service or video service within the
19holder's cable service or video service area within the local
20unit of government's jurisdiction.
21        (1) Gross revenues shall include the following:
22            (i) Recurring charges for cable service or video
23        service.
24            (ii) Event-based charges for cable service or
25        video service, including, but not limited to,
26        pay-per-view and video-on-demand charges.



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1            (iii) Rental of set-top boxes and other cable
2        service or video service equipment.
3            (iv) Service charges related to the provision of
4        cable service or video service, including, but not
5        limited to, activation, installation, and repair
6        charges.
7            (v) Administrative charges related to the
8        provision of cable service or video service, including
9        but not limited to service order and service
10        termination charges.
11            (vi) Late payment fees or charges, insufficient
12        funds check charges, and other charges assessed to
13        recover the costs of collecting delinquent payments.
14            (vii) A pro rata portion of all revenue derived by
15        the holder or its affiliates pursuant to compensation
16        arrangements for advertising or for promotion or
17        exhibition of any products or services derived from
18        the operation of the holder's network to provide cable
19        service or video service within the local unit of
20        government's jurisdiction. The allocation shall be
21        based on the number of subscribers in the local unit of
22        government divided by the total number of subscribers
23        in relation to the relevant regional or national
24        compensation arrangement.
25            (viii) Compensation received by the holder that is
26        derived from the operation of the holder's network to



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1        provide cable service or video service with respect to
2        commissions that are received by the holder as
3        compensation for promotion or exhibition of any
4        products or services on the holder's network, such as
5        a "home shopping" or similar channel, subject to item
6        (ix) of this paragraph (1).
7            (ix) In the case of a cable service or video
8        service that is bundled or integrated functionally
9        with other services, capabilities, or applications,
10        the portion of the holder's revenue attributable to
11        the other services, capabilities, or applications
12        shall be included in gross revenue unless the holder
13        can reasonably identify the division or exclusion of
14        the revenue from its books and records that are kept in
15        the regular course of business.
16            (x) The service provider fee permitted by
17        subsection (b) of this Section.
18        (2) Gross revenues do not include any of the
19    following:
20            (i) Revenues not actually received, even if
21        billed, such as bad debt, subject to item (vi) of
22        paragraph (1) of this subsection (c).
23            (ii) Refunds, discounts, or other price
24        adjustments that reduce the amount of gross revenues
25        received by the holder of the State-issued
26        authorization to the extent the refund, rebate,



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1        credit, or discount is attributable to cable service
2        or video service.
3            (iii) Regardless of whether the services are
4        bundled, packaged, or functionally integrated with
5        cable service or video service, any revenues received
6        from services not classified as cable service or video
7        service, including, without limitation, revenue
8        received from telecommunications services, information
9        services, or the provision of directory or Internet
10        advertising, including yellow pages, white pages,
11        banner advertisement, and electronic publishing, or
12        any other revenues attributed by the holder to
13        noncable service or nonvideo service in accordance
14        with the holder's books and records and records kept
15        in the regular course of business and any applicable
16        laws, rules, regulations, standards, or orders.
17            (iv) The sale of cable services or video services
18        for resale in which the purchaser is required to
19        collect the service provider fee from the purchaser's
20        subscribers to the extent the purchaser certifies in
21        writing that it will resell the service within the
22        local unit of government's jurisdiction and pay the
23        fee permitted by subsection (b) of this Section with
24        respect to the service.
25            (v) Any tax or fee of general applicability
26        imposed upon the subscribers or the transaction by a



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1        city, State, federal, or any other governmental entity
2        and collected by the holder of the State-issued
3        authorization and required to be remitted to the
4        taxing entity, including sales and use taxes.
5            (vi) Security deposits collected from subscribers.
6            (vii) Amounts paid by subscribers to "home
7        shopping" or similar vendors for merchandise sold
8        through any home shopping channel offered as part of
9        the cable service or video service.
10            (viii) Any revenues received from video
11        programming accessed via a service that enables users
12        to access content, information, electronic mail, or
13        other services offered over the Internet, including
14        Internet streaming content.
15        (3) Revenue of an affiliate of a holder shall be
16    included in the calculation of gross revenues to the
17    extent the treatment of the revenue as revenue of the
18    affiliate rather than the holder has the effect of evading
19    the payment of the fee permitted by subsection (b) of this
20    Section which would otherwise be paid by the cable service
21    or video service.
22    (d)(1) Except for a holder providing cable service that is
23subject to the fee in subsection (i) of this Section, the
24holder shall pay to the local unit of government or the entity
25designated by that local unit of government to manage public,
26education, and government access, upon request as support for



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1public, education, and government access, a fee equal to no
2less than (i) 1% of gross revenues or (ii) if greater, the
3percentage of gross revenues that incumbent cable operators
4pay to the local unit of government or its designee for public,
5education, and government access support in the local unit of
6government's jurisdiction. For purposes of item (ii) of
7paragraph (1) of this subsection (d), the percentage of gross
8revenues that all incumbent cable operators pay shall be equal
9to the annual sum of the payments that incumbent cable
10operators in the service area are obligated to pay by
11franchises and agreements or by contracts with the local
12government designee for public, education and government
13access in effect on January 1, 2007, including the total of any
14lump sum payments required to be made over the term of each
15franchise or agreement divided by the number of years of the
16applicable term, divided by the annual sum of such incumbent
17cable operator's or operators' gross revenues during the
18immediately prior calendar year. The sum of payments includes
19any payments that an incumbent cable operator is required to
20pay pursuant to item (3) of subsection (c) of Section 21-301.
21    (2) A local unit of government may require all holders of a
22State-issued authorization and all cable operators franchised
23by that local unit of government on June 30, 2007 (the
24effective date of this Section) in the franchise area to
25provide to the local unit of government, or to the entity
26designated by that local unit of government to manage public,



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1education, and government access, information sufficient to
2calculate the public, education, and government access
3equivalent fee and any credits under paragraph (1) of this
4subsection (d).
5    (3) The fee shall be due on a quarterly basis and paid 45
6days after the close of the calendar quarter. Each payment
7shall include a statement explaining the basis for the
8calculation of the fee. If mailed, the fee is considered paid
9on the date it is postmarked. The liability of the holder for
10payment of the fee under this subsection shall commence on the
11same date as the payment of the service provider fee pursuant
12to subsection (b) of this Section.
13    (e) The holder may identify and collect the amount of the
14service provider fee as a separate line item on the regular
15bill of each subscriber.
16    (f) The holder may identify and collect the amount of the
17public, education, and government programming support fee as a
18separate line item on the regular bill of each subscriber.
19    (g) All determinations and computations under this Section
20shall be made pursuant to the definition of gross revenues set
21forth in this Section and shall be made pursuant to generally
22accepted accounting principles.
23    (h) Nothing contained in this Article shall be construed
24to exempt a holder from any tax that is or may later be imposed
25by the local unit of government, including any tax that is or
26may later be required to be paid by or through the holder with



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1respect to cable service or video service. A State-issued
2authorization shall not affect any requirement of the holder
3with respect to payment of the local unit of government's
4simplified municipal telecommunications tax or any other tax
5as it applies to any telephone service provided by the holder.
6A State-issued authorization shall not affect any requirement
7of the holder with respect to payment of the local unit of
8government's 911 or E911 fees, taxes, or charges.
9    (i) Except for a municipality having a population of
102,000,000 or more, the fee imposed under paragraph (1) of
11subsection (d) by a local unit of government against a holder
12who is a cable operator shall be as follows:
13        (1) the fee shall be collected and paid only for
14    capital costs that are considered lawful under Subchapter
15    VI of the federal Communications Act of 1934, as amended,
16    and as implemented by the Federal Communications
17    Commission;
18        (2) the local unit of government shall impose any fee
19    by ordinance; and
20        (3) the fee may not exceed 1% of gross revenue; if,
21    however, on the date that an incumbent cable operator
22    files an application under Section 21-401, the incumbent
23    cable operator is operating under a franchise agreement
24    that imposes a fee for support for capital costs for
25    public, education, and government access facilities
26    obligations in excess of 1% of gross revenue, then the



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1    cable operator shall continue to provide support for
2    capital costs for public, education, and government access
3    facilities obligations at the rate stated in such
4    agreement.
5(Source: P.A. 99-6, eff. 6-29-15; 100-20, eff. 7-1-17.)