New telecom foreign ownership rules could cost millions to property
taxpayers, says Municipal Federation

Vancouver decision key as municipalities rally online ahead of telecom stampede

VANCOUVER, April 29 /CNW Telbec/ - The Federation of Canadian Municipalities (FCM) says new fibre technologies and proposed changes to telecom foreign ownership rules have the potential to create a "perfect storm" that could swamp municipalities and cost Canadian property taxpayers hundreds of millions of dollars.

At issue is the growing cost to property taxpayers of accommodating telecom companies that lay cable and install equipment on public property.

The Federation, in Vancouver today launching a campaign to mobilize municipalities and the federal government on this issue, thinks a 2009 CRTC ruling on a dispute between the City of Vancouver and telecommunications giant MTS Allstream could be the key to a solution.

"The coming on stream of new technologies at the same time as an increase in telecom foreign ownership could benefit consumers and businesses by expanding services and increasing competition," said FCM vice-president, Edmonton councilor Karen Leibovici. "But it has the potential to create a perfect storm that will spell huge new costs for municipalities and property taxpayers."

"When the City of Vancouver argued its case before the CRTC in 2009 it was just trying to get a favourable decision and fair deal for its taxpayers," said Vancouver City Councillor Raymond Louie. "This ruling could help rewrite the book on dealing with the telecoms and save Canadian taxpayers hundreds of millions of dollars along the way".

A 2008 study conducted by FCM found that municipalities subsidize telecommunications companies to the tune of more than $107 million per year. FCM fears that with the federal decision to open up foreign ownership in the telecommunications industry, things could get worse.

"With the federal government now set to change foreign ownership rules and invite even more competition, we want to rally municipal governments to present a common front to telecommunications companies and make it clear to the federal government that the Telecommunications Act must be changed to reflect the Vancouver decision and protect property taxpayers," added councilor Leibovici.

The landmark Vancouver decision broke important new ground and helped correct the power imbalance between municipalities and telecoms. FCM thinks it can serve as the basis of a stronger municipal bargaining position and ultimately for legislative changes.

FCM is turning to social media to help its 1800 member municipalities protect their property taxpayers. It has set up an online "campaign central" (www.knowyourrights.fcm.ca) to inform municipal officials of the 2009 CRTC decision and create a virtual space where they can share information and advocacy strategies as well as get expert advice on strengthening their bargaining position.

The City of Vancouver plans to introduce a bylaw incorporating the key elements of the 2009 decision. The ruling and the bylaw are expected to save the City and taxpayers upwards of $1 million per year.

For further information: Eric Collard at [phone] or [email protected]; City of Vancouver, Corporate Communications at [phone] or [email protected]