Request By:
Mr. Paul L. Madden
Hancock County Attorney
P.O. Box 207
Hawesville, Kentucky 42348
Opinion
Opinion By: Robert F. Stephens, Attorney General; By: Charles W. Runyan, Assistant Deputy Attorney General
Hancock Fiscal Court has under consideration the issuance of a cable television franchise covering the unincorporated portion of Hancock County.
An issue has developed as to whether the fiscal court may adopt an ordinance advertising for an exclusive franchise or whether an exclusive franchise would be in violation of § 3, Kentucky Constitution.
The court wrote, in Ray v. City of Owensboro, Ky., 415 S.W.2d 77 (1967) 80, that "only where the public interest demands should competition be restrained or limited." (Emphasis added). Thus under the holding in Ray, above, if the fiscal court, after a due consideration of the pertinent factors [including quality of service and cost] involving the public interest, determines that an exclusive franchise [issued under §§ 163 and 164, Kentucky Constitution] would be in the public interest, it may validly issue an exclusive franchise after the required bidding procedure. Specifically, if the fiscal court has good reason to believe, upon investigation, that excessive competition could result in poor service or even no service, then it can take steps to make service available, even if it involves an exclusive franchise.
The word "monopoly" has been defined as "any combination the tendency of which is to prevent competition in the broad and general sense, or to control prices to the detriment of the public. " (Emphasis added). Kenton v. Campbell Benev. Burial Ass'n v. Goodpaster, 304 Ky. 233, 200 S.W.2d 120 (1947) 126.
The court said, in Akers v. Floyd County Fiscal Court, Ky., 556 S.W.2d 146 (1977), that under KRS 67.080 and § 164, Kentucky Constitution, the fiscal court may divide a county into cable television districts and award a cable television franchise to the highest and best bidder in each district, where the fiscal court had determined, as a legislative matter, that such a method of operation will be for the best interest of the community. Justice Sternberg wrote in Akers that the fiscal court has the right to make reasonable classifications relating to cable television service, provided that there is some reasonable relationship between the regulation and the avowed purpose to be accomplished. See § 2, Kentucky Constitution. He said the resolution [relating to the franchise] must tend toward the accomplishment or promotion of public safety, health, peace, good order, or morals. Where an exclusive franchise is in the public interest, § 3 of the Constitution would not be violated, since the consideration is public services and the public interest.