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The following opinion is presented on-line for informational use only and does not replace the official version. (Mich Dept of Attorney General Web Site - www.ag.state.mi.us)


STATE OF MICHIGAN

FRANK J. KELLEY, ATTORNEY GENERAL

Opinion No. 6004

October 30, 1981

METROPOLITAN TRANSPORTATION AUTHORITY:

Payment of costs of the relocation, extension or improvement of utility facilities located within public rights-of-way

UTILITIES:

Costs incurred by privately-owned public utility in the relocation, extension or improvement of facilities within public rights-of-way

Costs incurred by municipally-owned public utility in the relocation, extension or improvement of facilities within public rights-of-way

Privately-owned public utilities are responsible for bearing the costs which may be incurred in connection with the relocation or improving of their facilities located within public rights-of-way necessitated by a downtown people mover and light rail system project to be installed by the Southeastern Michigan Transportation Authority, but the Authority is responsible for the costs of extension of service by the utility for such people mover and light rail system projects.

The Southeastern Michigan Transportation Authority must pay the costs of relocating, extending or improving municipally-owned public utility facilities located within the streets of the municipality necessitated by the construction of a downtown people mover and light rail system projects.

Honorable David A. Plawecki

Senate Majority Floor Leader

The Capitol

Lansing, Michigan

The Metropolitan Transportation Authorities Act, 1967 PA 204, Sec. 6(c); MCLA 124.406; MSA 5.3475(106), grants the Southeastern Michigan Transportation Authority (SEMTA), a public benefit agency and instrumentality of the state, the right to reasonable use of the spaces and areas over, under and upon public streets and highways in order to carry out its statutorily imposed responsibilities.

You have informed me that SEMTA has proposed a downtown people mover for the central business district of the City of Detroit, with a light rail system traveling through the Cities of Detroit and Highland Park in Wayne County, and the Cities of Ferndale, Pleasant Ridge and Royal Oak in Oakland County.

You have also stated that in order to accommodate construction of the light rail and people mover projects, both public and privately-owned public utilities will be requested to extend and/or relocate their facilities, and additionally, municipal codes may require improvement of those facilities which connect or are adjacent to those facilities which must be relocated.

You have, therefore, requested my opinion on whether SEMTA or the public and privately-owned public utilities are responsible for bearing the costs which the utilities may incur in connection with the relocation, extension or improvement of the utilities' facilities necessitated by the SEMTA downtown people mover and light rail projects.

In considering the question posed, a distinction must be made between the relocation, extension or improvement costs incurred by municipally-owned public utilities and the relocation, extension or improvement costs, if any, incurred by privately-owned public utilities.

With regard to the facilities of privately-owned public utilities being relocated, extended or improved from within public rights-of-way as a result of the SEMTA projects, 1925 PA 368, Secs. 13-15; MCLA 247.183-185; MSA 9.263-265, are applicable.

1925 PA 368, Secs. 13-15, supra, statutorily permits telegraph, telephone, power and other public utility companies and cable television companies and municipalities to construct and maintain utility facilities within public rights-of-way subject to the paramount right of the public to use such public rights-of-way, and as long as the facilities do not interfere with the public uses of the public rights-of-way. 1925 PA 368, Sec. 15; MCLA 247.185; MSA 9.265, specifically provides, in pertinent part:

'[Nor] shall anything in this section or sections 13 and 14 be construed to grant any rights whatsoever to any public utilities or cable television companies whatsoever, nor to impair anywise any existing rights granted in accordance with the constitution or laws of this state, but shall be construed as a regulation of the exercise of all such rights.' (Emphasis provided.)

In a letter opinion addressed to Representative Scott dated March 21, 1973, reported in OAG, 1973-1974, p 229, 231, 1925 PA 368, Secs. 14-15, supra, were reviewed and it was stated:

'These sections make it clear that a utility obtains no property rights in a road right-of-way when it places equipment there. The maintenance of the equipment is subject to the paramount right of the public to make use of the right-of-way. When some other use of the right-of-way arises, the utility must bear the expense of removing its own equipment.' (Citation omitted.)

The same letter opinion noted, at p 229:

'It has been held that public utilities must pay the cost of removal and relocation of their facilities when necessitated by improvement by governmental entities in control of the site. Detroit Edison Co. v City of Detroit, 332 Mich 348 (1952). In Detroit Edison, the plaintiff, a privately-owned public utility, declined to pay the cost of the removal and relocation of its poles and lines necessitated by the defendant city's construction of a sewer system. The plaintiff argued that it erected its facilities under the easement rights given by private grants [dedication to the use of the public]. However, the Court disagreed. In its final remarks, the Court said:

"We conclude that within the limited terms of the dedications here involved the city's right of control over and user in the designated strips are the same as in areas dedicated to the city for streets or alleys. This being so, it follows that, as plaintiff concedes under such circumstances, the expense of removing and replacing plaintiff's utility poles must be borne by plaintiff. . . .' (at p 354).'

In Consumers Power Co v Costle, 468 F Supp 375, 379 (1979), aff'd 615 F2d 1147 (1980), the federal district court noted:

'Although a utility does have a property interest in the exercise of its franchise, it has been held that the cost of moving or replacing equipment, even if caused by governmental action, must be borne by the utility. The easements granted to utilities are in trust for the public and not a grant of right to private individuals, New Orleans Gaslight Co., supra, 197 U.S. at 460, 25 S. Ct. 471; Detroit Edison Co. v. Detroit, 332 Mich. 348, 352-53, 51 N.W. 2d 245 (1952).'

It is my opinion, therefore, that privately-owned public utilities are responsible for bearing the costs which may be incurred in connection with the relocation or improvement, if any, of their facilities located within public rights-of-way necessitated by SEMTA's downtown people mover and light rail system projects.

As to extension of utility services to accommodate the needs of SEMTA's downtown people mover and light rail system projects, it is my opinion that the costs of extending the services of a privately-owned public utility within public rights-of-way must be borne by SEMTA pursuant to tariffs and rates approved by the Public Service Commission.

With regard to the facilities of municipally-owned public utilities, attention must be focused on Const 1963, art 7, Sec. 29, which provides:

'No person, partnership, association or corporation, public or private, operating a public utility shall have the right to the use of the highways, streets, alleys or other public places of any county, township, city or village for wires, poles, pipes, tracks, conduits or other utility facilities, without the consent of the duly constituted authority of the county, township, city or village; or to transact local business therein without first obtaining a franchise from the township, city or village. Except as otherwise provided in this constitution the right of all counties, townships, cities and villages to the reasonable control of their highways, streets, alleys and public places is hereby reserved to such local units of government.' (Emphasis supplied.)

1925 PA 368, Secs. 13-15, supra, recognizes the rights of municipalities set forth in Const 1963, art 7, Sec. 29, by requiring municipal consent to the use of its streets, alleys and public places.

1925 PA 368, Sec. 15, supra, provides that sections 13-15 shall not

'[b]e construed to grant any rights whatsoever to any public utilities or cable television companies whatsoever, nor to impair anywise any existing rights granted in accordance with the constitution or laws of this state, but shall be construed as a regulation of the exercise of all such rights.'

It is patently clear from a reading of the above statute that 1925 PA 368, Sec. 15, supra, does not abrogate municipalities' constitutional rights to control their streets and operate municipally-owned public utility facilities therein.

It is my opinion, therefore, that SEMTA must pay the costs of relocating, extending or improving municipally-owned utility facilities located within its own streets necessitated by the construction of the downtown people mover and light rail projects within the limits of the municipality.

Frank J. Kelley

Attorney General

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