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Tennessee Governor Bill Haslam’s proposal to let power cooperatives get into the broadband business looks like an improvement for Tennessee consumers. But, in my view, the proposal is mostly a bait and switch.
The plan, which the governor announced at a press conference last month, maintains strict limitations on the ability of public entities to improve their citizens’ broadband options. And it provides a $45 million subsidy that will go mostly to the same for-profit telephone and cable companies that are already doing a poor job of reaching all Tennesseans with affordable, quality broadband.
In 2010, the state Legislature put significant restrictions on both municipalities’ and co-ops’ ability to provide broadband. Jurisdictions that manage their own public utilities can provide broadband only within their service areas, and that’s only if they survive a series of legal and reporting hoops. Despite these roadblocks, several municipal utilities have successfully started providing broadband service in Tennessee. Chattanooga is the best known network, but six others are also in operation.
Several legislators, including State Senator Janice Bowling (R- Tullahoma) and State Representative Kevin Brooks (R-Cleveland), have tried to repeal the law. Eight repeal bills were introduced in one legislative session alone. In 2016, legislators and constituents put up such a cry that it repeal seemed imminent. However, legislators influenced by large incumbent communications corporations played one last card, which was to hire a consulting firm (Strategic Networks Group) to study the issue, thus giving incumbents another year to stall.
The numbers from that research are in. Data from more than 23,000 Tennessee individuals and businesses revealed 68% believe Internet speeds are not fast enough or reliable. A third of rural households, 725,000 people, are without access. Fifty-four percent of all households are connected to lower performing DSL, mobile wireless, satellite and dial-up services. More than two-thirds of businesses are below the FCC-designated minimum of 25 Mbps download speed. The report concludes: “Overall, demand for bandwidth is increasing and will continue to increase dramatically in the coming years.”
The Tennessee Proposal
Governor Haslam’s proposed Tennessee Broadband Accessibility Act appears to create opportunities for the state’s 22 electric co-ops to get into broadband delivery. Currently, the co-ops are banned by the state law from providing broadband. Collectively, these entities provide power to 800,000 homes, farms, and organizations.
While the proposal removes restrictions that keep co-ops from providing broadband services, the measure prevents co-ops from using any existing resources such as fiber cables, electronics, etc, which were installed to facilitate their business operations. A co-op subsequently can see the Promised Land, but they have to build a new bridge to get there. And that requires building a duplicate set of expensive internal infrastructure.
Currently, municipalities can get into broadband only if they do so through that municipality’s public utility, but utilities can’t offer broadband to areas adjacent to their service areas. So, if there’s no city-owned utility company, there’s no municipal broadband. The proposal will allow municipalities to be wholesalers for co-op projects.
Restricting public utilities to a wholesaler role provides no benefit if there’s not a nearby co-op. There’s also another restriction. Municipal networks can’t offer video services, which is how they can afford to underwrite networks.
Adding insult to injury, the governor offers $45 million to in grants and tax breaks, primarily to the large incumbents, to induce them to build out broadband with the same business practices that currently lead to disappointing results.
Senator Bowling feels the measure only goes halfway in removing limits.
“Incumbents confuse the conversation by trying to make it about what is fair for the provider, instead of focusing on what is right for the consumer,” she .told the Chattanooga Times-Free Press. “It is disingenuous to say you don’t want municipal utilities to compete with the private sector when you are giving another $45 million of taxpayer money to these private businesses.” Senator Bowling introduced legislation to take all handcuffs off of public utilities.
Virginia, Missouri Proposals Gets Pushback
Two other states have state broadband measures in play with their legislatures.
In Virginia, a proposal from Delegate Kathy Byron would prevent municipal networks in all parts of the state except those that lack broadband (defined as 10Mbps download and 1Mbps upload. Since cellular and satellite – expensive and frequently capped technologies – provide those speeds, few places in Virginia could legally provide municipal broadband if the measure passes.
Since the bill’s introduction, some residents and businesses have expressed displeasure with state legislator. The media in particular spoke out with dozens of stories, editorial’s, and op-eds. Brette Arbogast, Director of Technology for the Appomattox County School District, was interviewed by several publications about their public-owned network, a state success story.
“Media coverage [of the municipal broadband issues] has been fantastic,” said Arbogast. “People in the community have come together over this because broadband is so important to everyone. I’ve called and emailed state legislators, local officials, congressman, everybody I could think of to get their support.” Apparently this “all hands on deck” strategy by the media and the communities appear to be working.
In Missouri, co-ops have held open houses for legislators to show them the success of their network. The open houses are attractive to legislators, who love to hang their hats – and photo ops – on high profile, successful community projects. Community broadband supporters hope this reservoir of good feeling helps them beat back yet another legislative attempt this year to further restrict public broadband. (The bill [Senate Bill 186 — full text] is scheduled for a hearing in the Local Government and Election Committee on February 14, 2017.)
Learning from Others
Restrictions on publicly supported broadband are a regular feature of the state legislative calendar in many states. Groups in Tennessee and Colorado that support municipal broadband can learn from how other states have responded to such measures.
In Kansas in 2014, broadband supporters successfully beat down a bill that threatened to kill publicly owned broadband. Supporters there harnessed social media to educate and rally individuals, businesses and allies in the Legislature.
That same year, a state legislator tried to tighten Utah’s existing municipal broadband restrictions . Citizens opposition expressed in letters to legislators helped silence that bill.
The editor of the blog FreeUTOPIA in Utah, Jesse Harris, says online access gives activists new tools to organize and communicate. He recommends interested parties go to the bill’s page and subscribe to updates if this is a possibility. “If I saw something noteworthy, I published it and put it on Reddit for maximum exposure.” He also recommends that activists take advantage of any streaming of hearings and floor debates if they can’t attend in person.
Such online civic participation is just one more reason people need fast, affordable Internet connections.
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.