The City of Auburn is calling out Verizon on a debt the city says is long overdue. But the telecommunications provider claims it doesn't owe nearly the amount being sought and is taking the city to federal court over the dispute.

According to city officials, Verizon New York, Inc. has not paid to use municipal infrastructure since 2001 for its phone and Internet lines. City officials claim that the company owes more than $500,000 in missed payments and interest and are seeking help from an outside law firm to collect the money.

However, Verizon has claimed the city is illegally charging an unreasonable rate for use of its underground conduit network. The company filed a complaint last month in U.S. Northern District Court and is seeking a court order to prevent the city from pursuing the money.

Auburn City Council will vote Thursday on whether to hire Bond,

Schoeneck & King, PLLC, to aid the city with the case. Under the resolution, the law firm would be retained to work at rates between $175 and $275 per hour. The council meeting, which is usually held at 6 p.m. every Thursday, was rescheduled to 3 p.m. today.

According to city attorney John Rossi, the consultant is needed because cases are handled much differently in federal court than the state Supreme Court.

“Rules in federal court are very specific and unique to federal practice,” Rossi said. “We don't have the experience locally to handle (the case), unfortunately.”

Verizon is allowed to use a duct system under downtown Auburn for its telecommunication lines under a lease between its predecessor, New York Telephone Company, and the city. When it was signed in 1977, the lease allowed the company to use the system for an annual payment of 5 cents per linear foot.

Over the years, the city has raised the annual rate to 15 and then 20 cents, Rossi said. Verizon stopped paying in 2001 when the city raised the rate to 60 cents. At that rate, Verizon would have to pay the city approximately $64,000 each year to use the duct system, according to the complaint.

In 2006, city officials sent a letter to Verizon informing the company that it owes more than $370,000 in unpaid bills. Last month, the city received a check for $37,338.85 from Verizon, according to court documents. That amount would cover for the last seven years of use under the rate of 5 cents a foot. Under the 60-cent rate, Verizon currently owes more than $580,000.

The case is being heard in federal court because Verizon claims the city is violating the federal Telecommunications Act of 1996, which does not allow state or local governments to prohibit any entity from providing interstate telecommunications service, according to the complaint. The act allows a municipality to manage its own right-of-way in a way that is “fair and reasonable,” and “completely neutral and nondiscriminatory.”

In the complaint, Verizon representatives claim that the 60-cent rate is “unreasonable and discriminatory.” The complaint also accuses the city of breaking the lease, which indicates that any increase must be approved by a controlling board and must be limited to an amount necessary for a rise in maintenance costs, according to the complaint.

Rossi said the company's decision to pursue this case in federal court is “highly unusual.” There is no court date set, and it will probably take months before the case appears before a judge, he said.

“It is a very interesting argument, to say the least,” Rossi said. “We're just going to have to await the court's decision.”

Staff writer Christopher Caskey can be reached at 253-5311 ext. 282 or christopher.caskey@lee.net.