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Ms. Coralie A. Wilson January 10, 2003 Page 10 • initial matter, any. such additional authority would not apply to the obligations of the Franchisee under the Franchise, which are the subject of the Notice, because the Franchise clearly is a cable franchise issued pursuant to the franchising authority of the member cities under state law and subject to Title VI. Furthermore, in the case of the Commission and. its member cities, state law does not .provide any additional authority that would allow the imposition of franchise fees on interstate information services such as cable modem services. Specifically, Section 237.163, Subd. 7 states: "no local government unit may ... require a telecommunications right-of-way user to obtain a franchise or pay for .the use of the right-of-way." 22 This restriction applies to all private non-cable. entities using local rights of way for the purpose of transmitting voice or data communications.23 Thus, even if there were a credible argument that Section 622 does not apply to the Franchise, Section 237.163 would nonetheless flatly prohibit the .Commission and member cities from. imposing franchise fees on Franchisee's cable modem services. B. Franchisee Dispu#es the Claim that it has Violated Section. 8.5: Franchisee's Exclusion of Cable Modem Service Revenues from Its Report on Gross Revenues Does Not Violate the Franchise And, In Any Event, Franchisee Hereby Satisfies the Requirements for Cure. • As discussed above, Section 13.4 of the Franchise provides that both Franchisee and the member cities must automatically conform their actions to the dictates of federal law.. Upon the FCC's determination that cable modem service was not a cable service, the Franchisee properly conformed the reports associated with the Franchise Fee to the changed federal law by excluding cable modem service revenues from the calculation of gross revenues. Franchisee's reports therefore met the requirements of the Franchise. - ~ Minn. Stat. § 237.163, Subd. 7. Section 237.162-163 of the Minnesota Statutes imposes detailed restrictions on the fees and regulations a local government may impose on .entities using local rights-of-way for purposes other than the operation of a cable system. Section 237.163 provides that any entity (other than a cable operator and certain public utilities) owning facilities in local rights of way for the purpose of transporting telecommunications or other voice or data information may -use local rights of way subject only to the local government's right to "manage the public right-of-way" and recover its "right-of-way management costs." Minn. Stat. § 237.163, Subd. 2. While Section 237.163 details the local government's right to manage public rights-of-way and recover appropriate costs as including a variety of standard construction and engineering permit requirements, Section 237.163, Subd. 7 (quoted above) expressly provides that such rights-of-way management does not include the right to franchise or impose franchise fees on rights-of-way users. - za See Minn. Stat. § 237.162, Subd. 4 (defining a telecommunications right-of-way user as any person with a facility in the public right-of-way that is used or intended to be used for transporting telecommunications or. other voice or data information; only cable communications systems and certain municipal and cooperatively organized entities are excluded from this • definition).