State Legislators Disagree on Muni Broadband Merits

“The urban legend that comes from the legacy providers is these municipalities are not well run” and are “using tax dollars to compete against the private sector,” said Tennessee Sen. Janice Bowling (R), author of SB-1045, which would reverse the state ban on municipal broadband expansion that held back Chattanooga Electric Power Board. “The municipalities are not going to be cherry picking anything. They’ll be going where they’re asked to go, where the people have been held hostage by the profit margins of the legacy providers.”

Bowling’s bill is due for hearing Tuesday in the Senate Commerce and Labor Committee. The House Business and Utilities Subcommittee plans to hear a House version (HB-970) and other broadband bills the same day. If SB-1045 doesn't get enough votes, Bowling plans to propose two variations of the bill as the session goes on, she said. At a hearing last week, an official representing Gov. Bill Haslam (R) said the governor deferred to the committee’s opinion but isn’t supporting Bowling’s bill because he feels last year’s broadband bill is working. That bill, written by the administration and signed by Haslam, gave ISPs $45 million in broadband grants and tax credits (see 1704110014). The law has provided broadband to about 5,000 people at a price of $10 million so far, but there are still nearly 800,000 people who need service, Bowling said. Removing muni broadband restrictions can extend service into rural areas at no cost to the state, she said.

“I don’t support municipal networks because the technology is changing and improving so quickly,” emailed Washington state Rep. Mary Dye (R). “They are very expensive and municipalities have a very difficult time keeping up with the pace of the changes. Municipal networks tend to hang on to obsolete technologies too long and again, consumers get left behind in the race to the digital revolution.”

Dye prefers public-private partnerships and has a bill (HB-2664) to allow all ports to build wholesale fiber infrastructure within and outside district limits, building on a 2000 law that enabled only rural ports. The telecom industry initially resisted, and it has taken three years to get consensus, she said. Industry “saw the ports as direct public competition in their service area,” Dye said. But “many of the loudest opponents … are the companies that are utilizing the extra capacity that the port fiber offers,” she said.

Industry resistance dissipated this year, Dye said. The Washington Senate voted 48-0 last Tuesday in favor of Dye’s bill after a similarly unanimous Feb. 14 vote in the House (see 1802280027). The telecom industry grew more comfortable “when they realized the change would allow more capacity to be constructed and that fiber network would be available to lease on an open access basis that allows all kinds of new market development in areas that were less attractive but obviously have potential,” she said. Dye said she expected the House Friday to concur with Senate amendments, including one requiring ports to focus on unserved and underserved communities. Dye expects Gov. Jay Inslee (D) to sign the bill, given the bipartisan, unanimous support, and because the governor “has been wanting to have a rural broadband success” and Dye’s bill is this year’s “only opportunity,” she said.

“If the private sector is not interested, somebody needs to provide [broadband] service,” said Georgia state Sen. Steve Gooch (R), who has a bill (SB-232) that would authorize electric cooperatives to get in the internet business in unserved places. Government-owned municipal networks should be the last resort, but shouldn’t be banned, Gooch said, noting he voted against a state ban proposed in a previous session. ISPs should have first shot, followed by electric cooperatives and then municipalities, he said. Electric cooperatives “have the customer base” and “last-mile footprint” to effectively serve broadband, he said. The state Senate voted 54-0 Wednesday to send Gooch’s bill to the House.