VIDEO SERVICE DISPUTE RESOLUTION S.B. 190: COMMITTEE SUMMARY
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Senate Bill 190 (as introduced 2-4-09)
Sponsor: Senator Buzz Thomas
Committee: Energy Policy and Public Utilities


Date Completed: 2-12-09

CONTENT The bill would amend the Uniform Video Services Local Franchise Act to establish a process for the resolution of disputes between a customer and a video service provider, between providers, and between a provider and a franchising entity (i.e., the local unit of government in which a provider offers video service through a franchise).

Provider/Customer Dispute The Act requires each video service provider to establish a dispute resolution process for its customers, and notify them of it. Under the bill, each provider would have to notify its customers at least annually, and include the process on its website.


Under the bill, before a customer could file a complaint with the Public Service Commission (PSC) (as described below), the customer first would have to attempt to resolve the dispute through the provider's established resolution process. If the dispute could not be resolved, the customer could file a complaint with the PSC. The provider would have to give the customer the Commission's toll-free customer service number and website address.


The PSC would have to handle a complaint involving a dispute between a customer and a provider as described below.


An attempt to resolve the dispute first would have to be made through an informal resolution process. Upon receiving a complaint, the PSC would have to forward it to the provider and attempt to mediate a resolution informally. The provider would have 10 business days to respond and offer a resolution. If the dispute could not be resolved through the informal process, the customer could file a formal complaint. A formal complaint would have to be in writing and state the section or sections of the Act that the customer alleged the provider had violated, sufficient facts to support the allegations, and the exact relief sought from the provider. The formal complaint would have to comply with the requirements for a written complaint filed under the Michigan Telecommunications Act (MTA).


If the dispute involved an amount of $5,000 or less, the PSC would have to appoint a mediator within seven business days of the date the complaint was filed. The mediator would have to make recommendations for resolution within 30 days from the date of appointment. Within 10 days of the date of the recommendations, any named party in the complaint could request a contested case in the same manner as provided under the MTA.


If the dispute involved an amount greater than $5,000, the complaint would have to be resolved by a contested case hearing as provided under the MTA.


Provider/Provider or Provider/Franchising Entity Dispute


 Under the bill, if a dispute were between a provider and a franchising entity or between two or more providers, an attempt to resolve it first would have to be made through an informal resolution process. If a provider or franchising entity believed that a violation of the Act or the franchising agreement had occurred, the provider or franchising entity could begin an informal complaint process with the PSC. The provider or franchising entity could file with the PSC a written notice of dispute identifying the nature of the dispute, request an informal resolution, and serve the notice of dispute on the other party. Commission staff would have to conduct an informal mediation in an attempt to resolve the dispute. If a satisfactory resolution were not achieved, any named party could file a formal complaint.

A formal complaint would have to be in writing and would have to state the section or sections of the Act or parts of the franchising agreement that the party alleged had been violated, sufficient facts to support the allegations, and the relief requested. A provider's or franchising entity's attorney would have to submit to the PSC a written formal complaint that contained all information, testimony, exhibits, or other documents and information within the moving party's possession on which the party intended to rely to support the complaint. For 60 days after the complaint was filed, the parties would have to attempt alternative means of resolving it. If the parties could not agree on an alternative means within 10 days after the complaint was filed, the PSC would have to order mediation. Within 60 days from the date mediation was ordered, the mediator would have to issue a recommended settlement. Within seven days after that, each party would have to file with the PSC a written acceptance or rejection. If the parties accepted the recommendation, it would become the final order in the contested case. If a party rejected or failed to respond within seven days, the complaint would proceed to a contested case hearing in the same manner as provided in the MTA.

A party that rejected the recommended settlement would have to pay the opposing party's actual costs of proceeding to a contested case hearing, including attorney fees, unless the PSC's final order were more favorable to the rejecting party than the recommended settlement. A final order would be considered more favorable if it differed by at least 10% from the recommended settlement in favor of the rejecting party.


If the recommendation were not accepted, the individual Commissioners could not be informed of the recommended settlement until they had issued their final order.


MCL 484.3310

BACKGROUND

The Uniform Video Services Local Franchise Act required the PSC to submit to the Legislature by June 1, 2007, a proposed process to be added to the Act that would allow the Commission to review disputes not resolved through an individual provider's process, disputes between a provider and a franchising entity, and disputes between providers. In May 2007, the Commission issued a proposal containing a multistage approach and distinct processes for disputes between providers and customers, and those between providers or between a provider and a franchising entity. In developing the process, the PSC considered dispute resolution processes for other telecommunications and energy issues and solicited comments and suggestions from various stakeholders.
Legislative Analyst: Julie Cassidy


FISCAL IMPACT
The Michigan Public Service Commission has a dispute resolution process in place for customers; thus, the process in the bill for customers would impose no additional costs. The bill would implement the requirements of the Act by establishing a process for dispute resolution between providers and between providers and franchisers. This proposed dispute resolution has the potential to reduce costs by requiring the parties to use alternative dispute resolution methods before moving to a contested case hearing.


The Public Service Commission is funded primarily by assessments and fees paid by regulated industries. The authorization to charge video service providers these fees is included in Section 6(13); however, the section includes a sunset of December 31, 2009.

Fiscal Analyst: Elizabeth Pratt
Maria Tyszkiewicz

Analysis was prepared by nonpartisan Senate staff for use by the Senate in its deliberations and does not constitute an official statement of legislative intent. sb190/0910