Crown Castle, a “Public Utility” for Affluent Communities

Crown Castle uses its status as a “public utility” to force its way into the public right of way often against the will of the targeted municipality and nearby residents.  This investigative report present detailed evidence suggesting Crown Castle targets Distributed Antenna System (DAS) deployments toward communities based on factors other than service need.  State law requires public utilities provide just and equitable service regardless of location and prohibits discriminatory practices.  In contrast, Crown Castle utilizes its utility status to involuntarily force its way into primarily affluent communities, while seemingly ignoring the service needs of economically-disadvantaged communities.  A plausible though likely unlawful explanation is higher cell tower return on investment potential in affluent communities . 

 

Last week, we briefly mentioned the fact that the “community projects” shown on Crown Castle’s website were all in affluent enclaves.  It seemed to us that a “utility” was obligated to provide fair and equitable service regardless of community economic status.

Augusta_Pines_Crown_Castle

Augusta Pines, Texas, one of Crown Castle’s touted community projects.  Not your typical American community.

In California, Crown Castle is considered a “public utility” by virtue of it’s Certificate of Public Convenience and Necessity (CPCN).  A CPCN is, in effect, an agreement where the state grants an entity certain privileges such as public Right of Way (ROW) access in exchange for widespread provision of a desired commodity that the state deems to be in the public good (e.g. electric power, phone service).

Key to this agreement, and a requirement under state law, is that a “public utility” provide equitable service regardless of location.  For example, it is illegal for public utilities to target high-quality service toward affluent communities while providing low-quality or non-existent service to economically-disadvantaged communities.

A “Utility” With the Benefits but Without the Responsibilities

As any municipality that has dealt with Crown Castle knows full well, they aggressively assert their right to install cell towers in the ROW.  They adamantly maintain they are a “telephone corporation” under state law, thus they are entitled to ROW access privileges granted to those entities under Public Utility Code Section (PUC) Section 7901.  They proclaim this as holy writ with a near evangelical zeal.  They’ve got their CPCN, and those who question their ROW entry face a barrage of legal threats and even lawsuits.  Calabasas, Davis, and Irvine have all courageously withstood lawsuits, and won.

But what about the other side of the coin?  State law is clear that “public utility”  privileges come with obligations. State law is also explicitly clear that “telephone corporations” are public utilities.  PUC Section 216(a) spells it out (emphasis added):

“Public utility” includes every common carrier, toll bridge corporation, pipeline corporation, gas corporation, electrical corporation, telephone corporation, telegraph corporation, water corporation, sewer system corporation, and heat corporation, where the service is performed for, or the commodity is delivered to, the public or any portion thereof.

Now that we’ve established Crown Castle is a public utility, let’s take a look at their obligations under state law.  PUC Section 451 requires public utilities provide service in a just manner:

Every public utility shall furnish and maintain such adequate, efficient, just, and reasonable service, instrumentalities, equipment, and facilities, including telephone facilities, as defined in Section 54.1 of the Civil Code, as are necessary to promote the safety, health, comfort, and convenience of its patrons, employees, and the public.

PUC Section 453(a) makes clear public utilities can’t discriminate in the level of service provided:

No public utility shall, as to rates, charges, service, facilities, or in any other respect, make or grant any preference or advantage to any corporation or person or subject any corporation or person to any prejudice or disadvantage.

This obligation is further extended in PUC Section 453(c).  Here state law explicitly requires equitable service and facilities with respect to location:

No public utility shall establish or maintain any unreasonable difference as to rates, charges, service, facilities, or in any other respect, either as between localities or as between classes of service.

The point is clear, state law prohibits utilities from discrimination with regard to economic status implicitly (just service and facilities) and explicitly with regard to location.  Public utilities can’t pick and choose who they serve.  As Crown Castle’s utility status extends across California and they are required to provide equitable service and facilities across the state.

Crown Castle’s Touted Community Projects are Virtually All Affluent

Take a look at Crown Castle’s DAS community projects in California (here) and you’ll see some striking similarities regarding economic status.  We can’t speak for all of them, but we can say with certainty that they were not invited to come to Palos Verdes.  They are bullying their way into our ROW using their CPCN, something that primarily seems to happen when they want to install their cell towers in well-off communities.

Here’s the community projects  Crown Castle currently touts in California:

San Francisco’s Sunset and Richmond Districts

Crown Castle Richmond SF

A pleasant San Francisco residential district with a median household income of about $90K/year, 145% of the California average income.

Palos Verdes Estates

Palos Verdes Estates Crown Castle

One of the wealthiest and most beautiful cities in southern California with a median household income of $171K, 276% of the California average income.

Rancho Palos Verdes

Rancho Palos Verdes Crown Castle

The next door neighbor to Palos Verdes Estates.  Not quite as wealthy but very nice and doing quite well with a median household income of $121K, 195% of the California average income.

Palo Alto

Palo-Alto_Crown-Castle.jpg

Neighbor to Stanford University and a great city, a really nice place to live.  Median household income of $127K, 203% of the California average income.

Long Beach Waterfront

Crown Castle long beach

While Long Beach itself is quite economically diverse, this deployment will only serve the waterfront area.  According to the available stats, the waterfront median household income is $92K, 142% of the California average income.  It’s also well above the average Long Beach median household income of $52K.

Records Show Crown Castle’s Projects are Primarily Affluent

Perhaps Crown Castle singled out these neighborhoods for some reason but they aren’t representative of their typical projects.  To see, we pulled all of CPUC’s Distributed Antenna System (DAS) CEQA filings from California’s Office of Planning and Research.  Going back to 2007, we found about 130 specifically-described DAS projects from Crown Castle or its prior entities NextG Networks or NewPath Networks.

After processing the data, it was immediately evident the median household income of the DAS-targeted communities was well-above California averages.

  • California median household income:  $61,489
  • Average DAS project community median household income: $78,209

Sometimes medians can be misleading, so we plotted the distribution of Crown Castle’s DAS projects versus that of California Census Designated Places (CDPs).  We wanted to see if a bias was present toward well-off communities.  Here’s the neighborhood income distribution of their projects:

Crown Castle DAS project distribution A

California median household income distribution for Crown Castle DAS Projects (red bars) versus Census Designated Places of 1500 or more people (blue bars).

If Crown Castle was providing equitable service, you’d expect these two distributions to look somewhat comparable, they obviously don’t. This, coupled with the median household income disparity, provides compelling evidence that Crown Castle’s DAS projects are skewed toward more affluent areas.

In reviewing the Crown Castle DAS targeted communities, some patterns start to emerge:

Communities that appear over represented:

  • Affluent enclaves – Malibu, Marin County, Palos Verdes, Manhattan Beach, Rancho Sante Fe, Montecito
  • Affluent neighborhoods in large cities – Noe Valley (SF), La Jolla (SD), Sunset (SF), Bel Air (LA), Oakland Hills (Oakland)
  • Upper middle class suburbs/satellites – Lake Forest, Gilroy, Huntington Beach, El Segundo, Carlsbad, Santa Clarita, Chino Hills, Laguna Niguel

Communities that are more lightly represented:

  • Traditional “blue collar” cities and communities – Spotty but they do appear and include National City, Riverside, Pico Rivera, Long Beach, El Cajon, Silverlake (LA) and Bellflower

Communities that are virtually absent:

  • Inner city communities – almost none, a few filings for Compton, no others found
  • Central Valley and ethnic farm communities – virtually none

The pattern is pretty clear, Crown Castle’s projects aren’t representative of typical California communities and are biased toward well-off neighborhoods.  To understand why they would do this one must understand that a cell tower is an asset.  Once in place they can be used to provide services other than just simple cell phone coverage.  Towers in affluent areas are more valuable assets than towers in less well-off areas.

However, public utilities can’t favor affluent areas under the law.  Consider if Southern California Edison or Pacific Gas and Electric (genuine public utilities) behaved this way.

Are There Other Explanations?  Apparently Not

Could the disparity be caused by topography or municipal height limits that favor DAS deployments?  Unlikely as the explosion of DAS growth is supposedly based on increased capacity needs, not coverage.  In Palos Verdes, Crown Castle is claiming they need a new DAS site only 850 feet from an existing AT&T macro site despite very high existing signal levels.  Wouldn’t this apply to economically-disadvantaged communities also?

Also it doesn’t explain why they are forcing themselves into the ROW in affluent areas completely uninvited.  No one asked them to come here, they approached Palos Verdes Estates and Rancho Palos Verdes, and demanded access to the ROW with a barrage of legal claims as part of their CPCN.  Residents strongly prefer cell towers be located elsewhere and not in the ROW in close proximity to homes.  Crown Castle isn’t interested in doing so.

“Required” Service Levels

Even more damning, there appears to be a large disparity with the Crown Castle-claimed “required” signal levels in affluent areas versus the existing signal provided in low income communities.  They have 22 sites proposed for Palos Verdes Estates just for AT&T alone.  In their site justification and Planning Commission hearings , they steadfastly claim -75 dBm RSRP signal level is required hence the high number of required sites. This value is absurdly high, about 20 dB higher (100 times as it’s logarithmic) than typical LTE RSRP levels.

This isn’t isolated just to Palos Verdes.  We were sent maps depicting “required” signals for another Crown Castle deployment currently proposed for Piper Glen, an affluent golf course community in Charlotte, NC.  (Crown Castle is also targeting primarily affluent neighborhoods in other states so this isn’t just a California issue.)  Here they they also claim -75 dBm RSRP is required, and they need nine new cell towers within residential neighborhoods to “fix” it.  The areas shown in blue are alleged to have inadequate service (that is, lower than -75 dBm).

Crown Castle Piper Glen

Crown Castle drive map showing existing service in Piper Glen, another targeted affluent community.  Note “required” in-building service is the green shades with a minimum level of -75 dBm RSRP.

There’s more to the story that they aren’t telling us and it begs an important question:

If -75 dBm RSRP is a minimal acceptable level for Palos Verdes and other affluent areas, then does Crown Castle provide this service level in economically-disadvantaged neighborhoods?  If not, wouldn’t this be evidence of discriminatory practices? 

Crown Castle is a public utility required under state law to provide equitable service, right?  So do the neighborhoods that Crown Castle completely ignores have -75 dBm RSRP service levels?  Not based on our tests.

Our Own Drive Test

We did our own drive test through the residential neighborhoods of Wilmington, an economically-disadvantaged community within the City of Los Angeles.  We chose Wilmington for it’s close proximity to Palos Verdes and economic status.  Wilmington’s median household income is $46K/year, 74% of the California average income.

Our tests measured LTE RSRP for AT&T’s network (the same provider in Crown Castle’s proposed Palos Verdes deployment).  Here’s our results:

wilmington drive map

Drive map results conducted in Wilmington (Los Angeles), California on 8/21/2016.  Crown Castle’s “required” signal levels in Palos Verdes Estates is -75 dBm (dark green and light green).  Of the 1070 measured data points in Wilmington, only 83 (7.7%) meet the requirement.  Median measured value is -95 dBm.

As you can see, Wilmington’s AT&T RSRP is well below the -75 dBm Crown Castle claims is required in Palos Verdes.  It’s median value is -95 dBm which is actually pretty typical for LTE coverage.  So where is Wilmington’s “required” Distributed Antenna System deployment?  We won’t hold our breath.

Though we have not yet run full drive tests, measurement sampling in other communities of comparable economic status (Harbor City, North Long Beach, and Carson, California) show similar results to Wilmington.  Crown Castle’s absurdly high “required” signal levels in Palos Verdes have no justifiable basis.

Crown Castle and its CPCN

In our opinion, the legitimacy of Crown Castle’s CPCN is a highly questionable.  It’s doesn’t appear to be used for the public convenience but for their own convenience.  It’s a hammer to force cities they choose into relinquishing access to the ROW against their will.  Most cities would never voluntarily accept these highly intrusive cell towers in their ROW, particularly right next to homes and without compensation to boot.  Due to Crown Castle’s CPCN and army of lawyers, most cities think they have no choice.

Crown Castle claims all the benefits of a public utility but doesn’t appear to accept the responsibility.  The data shows it does not provide equitable service across locations as would be expected of a public utility.  They appear to ignore economically-disadvantaged communities and heavily target more affluent areas with their alleged “public convenience and necessity”.  This is almost certainly driven by Crown Castle’s own profit potential.  Remember that Crown Castle is cell tower company, not a wireless carrier.

Once in place, these sites can be used by Crown Castle for other services.  A cell tower in a Palos Verdes neighborhood is a far more valuable corporate asset than one located in a Wilmington neighborhood.  Crown Castle demands ROW access to provide alleged “required service” in Palos Verdes despite the fact signal levels in Wilmington and other economically-disadvantaged communities are much lower.  How is this legal for a public utility?  We think it isn’t.

Can you imagine the anger if a genuine utility such as SC Edison or PG&E focused on affluent areas and only supplied intermittent power to low income neighborhoods?  Consider the justifiable outrage in Flint, Michigan regarding the cities tainted water supply and the suspicion it wouldn’t have happened in an affluent suburb.  People were rightly angry, real public utilities can’t do this, they must provide service in a just and equitable fashion.

It seems to us that Crown Castle’s “public utility” persona is an integral and well-executed aspect of their business model.  All the benefits without the responsibilities.  Pretty sweet deal.

 

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