Gov. Charles S. Robb, responding to an urgent plea by Fairfax County, today introduced legislation to exempt local governments from antitrust lawsuits when they award exclusive cable television franchises.
Fairfax officials said later that unless the bill is passed before the General Assembly adjourns March 13, the county would be unable to proceed with plans to award a $100 million cable franchise to one of two applicants this summer.
"There's absolutely no way that Fairfax County could award a franchise without the bill ," county Board Chairman John F. Herrity said. "We could be hit with a lawsuit for monopolistic practices and there could even be individual and personal liability on the board members. And there's probably a lot of teed off applicants out there who might be interested in doing that to us."
Similiar legislation is pending in the Maryland legislature. It would allow Montgomery County and other localities to award exclusive franchises for cable television without the threat of antitrust lawsuits.
The antitrust threat arose out of a Supreme Court ruling in January involving a challenge brought by the losing bidder for a cable award in Boulder, Colo. In an opinion some legal analysts say has far-reaching implications for local governments around the country, the court said localities were not exempt from such antitrust suits unless they acted under specific state authority.
In response to an inquiry from Fairfax County Attorney David Stitt, Attorney General Gerald Baliles said on Feb. 16 that existing state law did not provide that authority for the award of cable franchises. That means about 25 to 30 Virginia cities and counties that have already awarded cable franchises, including Arlington and Alexandria, as well as many others such as Fairfax that are in the process of awarding them, could be challenged for antitrust violations unless state law is changed.
The implications of the ruling, however, could go beyond that. A recent article in the National Law Journal suggested that countless other exclusive awards by localities, such as for garbage collection, taxi cab service and electric utility services, might also be challenged under the ruling.
A Robb spokesman said today the governor originally had hoped to introduce a comprehensive bill that would address the full array of local services that might be affected by the ruling. He finally decided to restrict the bill to cable awards because "it would have a much more realistic chance of passage," the aide said.