“The FCC said local cable franchising authorities (LFAs) cannot regulate a cable operator’s broadband service and that in-kind services or equipment they require those cable operators to provide must count toward the FCC’s 5% cap on franchise fees,” B&C reports.

The vote today at the FCC’s public meeting was 3-2 along party lines, the report notes.

“The vote was on a Report and Order (R&O) responding to a court [remand] of an earlier deregulatory decision the court said had been insufficiently explained,” B&C reports. “There is an exception from the in-kind counting for some, but not all, capital costs of providing public, educational and government (PEG) channels, whose public interest value the FCC said it continues to recognize.”

FCC Chairman Ajit Pai is quoted in the story saying that counting in-kind “exactions” from LFAs was necessary “to prevent local authorities from unlawfully evading the 5% statutory cap on franchise fees” via those non-monetary conditions.