The Next Generation of Technology Legislation

One of the hottest topics in technology right now is the deployment of fifth generation or “5G” networks in the United States. When fully deployed, 5G networks promise a wide array of improvements over 4G networks, including download and upload speeds that are anywhere from 10 to 100 times faster, almost instant connection times and higher reliability.

But with new technology comes new challenges and, in this case, the likelihood of new regulations. To achieve higher speeds and reliability, 5G networks operate on a much higher frequency radio band than previous generations did. The higher frequency results in a much shorter transmission range and a diminished ability to pass through walls. This means antennas must be placed every few hundred meters throughout buildings.

And it’s where the potential for new regulations enters the picture. In order to help facilitate the deployment of 5G antennas, the Federal Communications Commission (FCC) is proposing expansion of the rules which govern antenna users’ ability to install over-the-air reception devices, known collectively as the “OTARD” rule. The new rules could have major implications for real estate managers and their clients.

The original OTARD rule was adopted by the FCC as part of the Telecommunications Act of 1996 and has been amended several times since. The FCC wants to amend the rule once more with the coming of 5G. The commission published a Notice of Proposed Rulemaking on May 2 recommending further expansion of the OTARD rule to permit the installation of fixed wireless hubs or relay antennas on leased property without the consent of the property owner.

While many are excited by the widespread benefits that could become a reality when using a 5G network, availability is still quite limited. As of June, 5G networks were live in only 23 cities spanning 14 states. However, these figures are expected to grow quickly, making this proposed rule change all the more worthy of industry attention.

New Rules with New Risks

According to Megan Booth, director of federal housing, valuation, commercial real estate policy and programs for the National Association REALTORS® (NAR), this proposal could impact the real estate market in two ways. First, it could give apartment residents or commercial tenants the right to install 5G small cells or other wireless infrastructures on their balconies or within their leased space, not only to boost their individual coverage and reception but also to transmit the signal to other customers of the telecom provider by serving as a “hub.” In addition, it may allow a telecom carrier that already leases rooftop space from a property owner (for antennas or other equipment) the ability to attach a 5G small cell or other wireless infrastructure on that existing equipment without amending their agreement with the owner.

This is why, on June 3, IREM joined NAR and a coalition of other industry stakeholders in submitting comments to the FCC urging it to refrain from extending the OTARD rule such that it would permit the installation of antennas or similar devices on leased property without the consent of the owner. IREM supports the deployment of broadband infrastructure but is concerned that these modifications could harm its expansion. The proposed amendment could increase the risks and costs to property owners, potentially causing them to reconsider leasing space to the telecommunications providers.

Making Amendments

Looking back over its history, it is clear that the 1996 signing of the Telecommunications Act was a major milestone in the continuing development of the nation’s communications infrastructure. The act is very broad in its application and addresses national issues such as universal service guarantees to all individuals; deregulation of local telephone and cable television service to promote competition; reforms to regulations that inhibit access to the internet; and greater access to advanced technologies such as satellite communications.

Though the act’s scope is far-reaching, the issues of satellite dish/antenna placement and telecommunications provider access to interior wiring quickly became important issues for the real estate management industry. They were first addressed by the OTARD rule in October 1996. Originally, the rule prohibited restrictions that impaired the installation, maintenance or use of antennas that received video programming. It only applied to video antennas such as direct-to-home satellite dishes that are less than one meter in diameter (or of any size in Alaska), TV antennas and wireless cable antennas. The rule started by prohibiting most restrictions that:

• Unreasonably delay or prevent installation, maintenance or use;
• Unreasonably increase the cost of installation, maintenance or use; or
• Preclude reception of an acceptable quality signal.

In 1999, the rule was amended to apply to rental property where the renter has an exclusive use area, such as a balcony or patio. A year later, the FCC amended the rule once more to include customer-end antennas that receive and transmit fixed wireless signals. This broadened rule applies to individuals who place antennas meeting size limitations on property they own or rent and that is within their exclusive use or control, including condominium owners and cooperative owners, and tenants who have an area where they have exclusive use. The rule also was extended to townhomes, manufactured homes and single-family homes.

The Right to Set Limits

Local governments, community associations and landlords are allowed to enforce certain restrictions so long as they do not impair the installation, maintenance or use of the covered antennas. Restrictions needed for safety or historic preservation may also be permitted. Under some circumstances where a central or common antenna is available, a community association or landlord may prohibit the installation of individual antennas. The rule does not apply to common areas that are owned by a landlord, a community association or jointly by condominium or cooperative owners where the antenna user does not have an exclusive use area such as the roof or exterior walls.

Looking ahead, it is vital that Congress, the FCC and the states be cognizant of the potential problems created by regulations preventing building owners and managers from managing access to private rights-of-way and to the outsides of their buildings. For this reason, IREM will continue to monitor this issue as the rulemaking process moves forward.