The City of Hays has filed suit against Nex-Tech, LLC; Big River Telephone Company, LLC; and Eagle Communications, Inc., related to the imposition of franchise fees for services provided to customers in the city.
The suit, which was filed July 9 in Ellis County, seeks a court order requiring Big River to enter into a franchise agreement with the city intended to collect city franchise fees for Big River’s service to Eagle Communications for Eagle Communications’ IP-delivered telephone service. Cities with franchising authority currently collect franchise fees on traditional switched telephone service delivered through traditional methods, but not IP-based service, which is delivered entirely via internet.
The suit also asks the court to make a determination as to whether or not Eagle Communications, with or without services from Big River, should be required to enter into a franchise agreement to provide its internet-based telephone service. And, the suit seeks to establish that the city can continue to require Nex-Tech to enter into a franchise agreement to provide its service in Hays based on the technology Nex-Tech utilities.
“We have enjoyed a good and long-standing working relationship with the City of Hays and believe we have complied with all of the past franchise requirements and the legal requirements for delivering VoIP (Voice over Internet Protocol) technology,” said Eagle President and CEO Gary Shorman. “We are disappointed the city chose to use this process to pursue additional fees from our customers for the city, and we think the law is clear that no such fees are appropriate for the service and technology we provide.”