Analysis: Bills in VA. and MO. Would Double Down on Banning Municipal Broadband

Legislation proposed in Virginia and Missouri would tighten the noose that restricts local governments from creating broadband options. In Virginia, the bill comes from a state delegate with strong ties to the telecommunications industry and with ALEC, the national advocacy group that wrote similar laws for other states.

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A Virginia state delegate who has received contributions from six telecommunications corporations has introduced a bill to place further restrictions on municipal broadband.

“Virginia is being suckered by another industry-written public-broadband ban in a bill bought and paid for by Big Cable,” states Phillip Dampier, editor of Stop the Cap and long-time analyst of efforts to restrict local governments from getting into municipal network.

The Virginia bill is sponsored by Delegate Kathy Byron, R-Campbell County, a member of a national telecommunications task for of ALEC, the American Legislative Exchange Council. ALEC brings together state lawmakers and corporate leaders to craft model legislation.

Some Republicans who are free-market advocates can’t support Virginia’s latest attempt to quell public-owned networks. Conservative blogger Susan Sili says the bill allows state government to interfere with issues that ought to be the purview of local government. “This is completely frustrating from a local perspective where we have spent years trying to convince citizens in Caroline [County] to vote for less government and free enterprise in a blue county.  This kind of U-turn from our creed certainly isn’t helping.”

Meanwhile, a similar bill winds its way through the state legislature in Missouri.

Delegate Kathry Byron.
Delegate Kathry Byron.

Telecom and cable industries are doubling back to make already existing state restrictions tougher, reducing the ability of local governments to create competition for telecommunications services. This time incumbents (the telecommunications companies or successors that were in place before telecommunications deregulation) are giving their bills pro-community broadband titles (Virginia Broadband Deployment Act) and paragraphs of complimentary rhetoric that lead to innocuous sounding directives that are actually quite harmful for municipal broadband advocates.

 

Beware the Hemlock in the wine

Virginia’s State House Bill 2108 effectively stops cold all of the efforts the state has taken to get broadband in communities through seemingly benign definition. The bill allows municipal networks only in areas that don’t already have broadband – defined as 10 Mbps download speed and 1 Mbps upload.

First, there’s no “technology exclusions” for cellular or satellite coverage. If you look at a coverage map that includes cellular and satellite, almost the entire state appears to be served. However, cellular and satellite in the real world has problems (hills, foliage, rain, etc.) that hinder or prevent coverage where it’s most needed. Data caps and overage fees make cellular and satellite services unaffordable for many constituents.

Second, most residents that have students, adults who worked from home and owners of home businesses need more than 10 Mbps speed today, and the need is increasing. Additionally, quite of few regular businesses, medical facilities, libraries, and other organizations require many dozens or hundreds of megabytes of speed. These are why communities build their own networks.

Third, when incumbents game the data in broadband maps, an entire zone may be displayed as having coverage even if only two or three homes have 10/1 speeds. Furthermore, an incumbent can claim they have an area covered by advertising “up to 10 Mbps” in their materials, whether or not customers actually receive that maximum.

Has anyone actually read this Virginia broadband bill?” asks Dampier at Stop the Cap. “It requires any public broadband project planning an overbuild to get approval from the Broadband Advisory Council.” Members of the council include the chair, Delegate Byron, who introduced Bill 2108 and serves as president of the Virginia cable lobby. “I am guessing no project will ever make it out with approval!” Dampier wrote.

Michael W.S. Lockaby, a lawyer who analyzed Bill 2108 for the Friends of Municipal Broadband, said the bill virtually eliminates competition. “The rationale here is to remove local entities [public institutions] as effective competitors for private internet providers,” he wrote in his analysis. Because the bill is “essentially prohibiting competition in the marketplace, it plainly violates the spirit and intent of the Telecommunications Act of 1996, which was intended to promote competition.”

 

In Missouri, it’s déjà vu all over again – and again

In Missouri, meanwhile, the state’s current anti-municipal network law, written in 1997, bans public entities from owning and providing telecom services. But it’s always been an implied or assumed ban, even though an exception for broadband was written into the bill. One Missouri city built a network without challenge, and Columbia two years ago planned to play the same “Get Out of Jail Free” card.

The Missouri Legislature has been making annual efforts since 2014 to ban muni broadband. This year’s entry is SB 186, which would prohibit retail or wholesale competitive service. By banning wholesale efforts, the bill would prevent a municipality from working with private-sector companies to supply broadband.

“SB 186 sets up onerous hurdles that threaten to sabotage a network in the early days, discouraging local communities from pursuing a chance to serve residents, businesses, and municipal facilities,” says Christopher Mitchell, director of Community Broadband Networks at the Institute for Local Self-Reliance (ILSR). “The bill also dictates ballot language, establishes geographical limits on any local network, and clearly established that no funds from other municipal services can be directed toward a municipal network.”

The bill is now in the Local Government and Elections Committee, but no hearing has been scheduled yet. (View the entire text of SB 186 online.)

 

Opinion: Community broadband success gives truth to incumbent’s lies

 

The two most repeated and certifiably false claims by incumbents and the legislators who parrot them are: 1) most local governments have no expertise in managing or maintaining systems of that complexity, and 2) the vast majority of municipal broadband systems across the country have failed.

There are over 400 municipal and public utility broadband networks. Most are successful, covering entire cities and counties or providing partial jurisdiction coverage. Some networks are fully publicly owned while an increasing number are owned by public-private partnerships.

Thomasville, Georgia, a city of about 19,000 residents on the Florida state line near Tallahassee, had little more than dial up when the city built their own network in 1999. From humble beginnings, the network went on to become a success story. Their network now generates $2 million a year for city coffers. This enabled them in 2012 to eliminate taxes. The City of Santa Monica’s IT Department in California self-funded the city network and generated over $2 million in revenues, which it reinvested in the network.

In Virginia, over a dozen cities and counties have built successful networks. Danville’s public utility used its network as part of efforts to drive unemployment down from 19% to under 9% in six years. King and Queen County build its own network and hired a private company to run the service operations. Roanoke Valley Broadband Authority built its fiber backhaul and middle-mile infrastructure, is signing on private providers, and is ready to provide some internet service directly to constituents if need be.

More Virginia municipal broadband stories are contained in a report from the Institute for Local Self Reliance. Additional information on current state restrictions on publicly owned broadband available here and here.

It is hard to tell how the battles will pan out, but in Virginia and Missouri communities have a lot of fight and determination. There is a general feeling that there is too much riding on this battle to lose.

Craig Settles is a broadband industry analyst, consultant to local governments, and author of “Building the Gigabit City.” He also passionate believes in the right of rural and urban communities to set their own broadband destiny.

 

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