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Wheeler Tells Cable Industry He Intends to Remove Anti-Competitive State Laws

FCC Chairman Tom Wheeler is prepared to roll back restrictions that prevent local governments from deciding if a municipal network would be a wise investment. At the Cable Show Industry conference in Los Angeles, Wheeler told cable industry leaders the FCC will wield its powers to reduce state barriers on municipal networks.

Wheeler spoke before the National Cable & Telecommunications Association (NCTA) on April 30. These words perked up our ears and those of community networks advocates across the U.S. From a transcript of Wheeler's speech

"One place where it may be possible is municipally owned or authorized broadband systems. I understand that the experience with community broadband is mixed, that there have been both successes and failures. But if municipal governments—the same ones that granted cable franchises—want to pursue it, they shouldn’t be inhibited by state laws. I have said before, that I believe the FCC has the power – and I intend to exercise that power – to preempt state laws that ban competition from community broadband."

As our readers remember, a January DC Circuit Court of Appeals decision opened the path for the FCC to take the action Wheeler proposes. Since then, communities have expressed their desire for local authority with resolutions and letters of support. Communities in Michigan and Louisiana, Georgia and Idaho, Illinois, Maryland and Kansas, have shared their resolutions with us. A number of other communities have issued letters of support encouraging action under section 706.

Ars Technica contacted the FCC for more information on Chairman Wheeler's statements. Ars reported:

An FCC spokesperson contacted by Ars said that Wheeler "is not trying to make a distinction between 'ban' or 'limit.' The point is to look at the effect of the law."

The spokesperson said, "We will be taking up this issue in the technology transitions proceedings, and there should be an announcement about this in the next few weeks." It's too early to say "how [Wheeler] will address existing state laws."

As the big companies like Comcast consolidate, enforce bandwidth caps and continuously raise prices, municipal networks are more important than ever. Community owned networks are accountable to the people who use them and put the public good ahead of profit. Community networks are managed in your neighborhood, not in a corner office thousands of miles away.

The content of Wheeler's statement and his choice of venue inspires advocates for publicly owned networks. In order to keep a strong momentum rolling, we encourage you to express your support. The cable and telecommunications lobbyists are already working to prevent the FCC from taking action. When the FCC begins to act, we will want to demonstrate support.

Join our one-email-per-week newsletter to stay in the loop on these developments! If you are excited to demonstrate local support via a resolution or similar effort, let us know.

GovTech Reports on Broadband Legislation in Five States

Broadband is a topic of interest in several state legislative chambers this session. In a recent Government Technology article, Brian Heaton focused on five states where community broadband is particularly contentious. In some cases, legislators want to expand opportunities while others seek to limit local authority.

We introduced you to the Kansas anti-competition bill in January. The bill was pulled back this year but could be back next year. When the business community learned about the potential effects of SB 304, they expressed their dismay. From the article:

Eleven companies and trade organizations – including Google – signed a letter opposing SB 304 as a “job-killer” that restricts communications services expansion in the U.S.

Minnesota's leaders introduced legislation to expand broadband. Efforts include financial investment earmarked for infrastructure:

Senate File 2056 – referred to as the Border-to-Border Infrastructure Program – would take $100 million from the state's general fund to be applied to broadband projects. A companion bill in the House, HF 2615 was also introduced.

As we reported, there is bipartisan support for the bill in the House, but the Senate and Governor have not prioritized SF 2056.

New Hampshire's legislature wants to open up bonding authority for local communities that need help:

Legislation is making its way through the New Hampshire Legislature that would give local government expanded bonding authority for areas that have limited or no access to high-speed Internet connectivity. Sponsored by Rep. Charles Townsend, D-Canann, HB 286 passed the House earlier this year and is up for a hearing in the Senate Energy & Natural Resources Committee on April 23.

Heaton also reports on the Utah bill that targeted UTOPIA. The bill concerned potential private partners and appears defeated, but broadband advocates remain alert.

The agency [UTOPIA] has 11 member cities, but communities located outside the limits of member cities can pay to have the network built out to them.

HB 60 would prevent that from happening with specific language that targets only municipal fiber networks – potentially including a Google Fiber rollout in Provo, Utah. That means other forms of broadband such as DSL or cable would be exempt.

Tennessee is especially busy this session. Lawmakers introduced a collection of legislation aimed at enabling local communities to develop community networks. All appear stalled in committee or forgotten by leadership. Heaton spoke to Chris Mitchell about action in Tennessee:

Christopher Mitchell, director of the Telecommunications as Commons Initiative of the Institute for Local Self-Reliance and a national expert on community broadband, told Government Technology that he wasn’t surprised that the bills stalled. He explained that for years, broadband advocates have tried to remove some of the barriers to network expansion in the state, but to no avail.

“The ironic result is that the federal government may be subsidizing obsolete DSL because the state will not allow local governments to expand next-generation community fiber networks even when they are not subsidized in any way,” Mitchell said.

“Many of the elected officials still don't [have] enough pressure on them from constituents to stand up to AT&T and Comcast,” he added. “Those two firms have a lot of power in the [Tennessee] Legislature.”

Voters Approve Local Telecommunications Authority in Montrose, Colorado

By a 3,982 in favor and 1,397 opposed, the voters in Montrose decided on April 1st to take back local authority for telecommunications services. The state revoked the community's ability to establish a telecommunications utility in 2005. 

Jim Branscome covered the election results in the Daily Yonder. Branscome, a resident of Montrose, knows the local broadband situation:

Internet service here is currently a hodgepodge. Some of us depend on broadcast towers, some on DSL from CenturyLink and some on cable service from Charter. Service is generally at less than 10MB. It’s expensive, and customer service is erratic.

Community leaders state that they want to encourage fair competition and ensure every one has the opportunity to fast, reliable, affordable connectivity. 

In addition to ensuring that local businesses are in a position to compete with any large corporations that might attempt to establish a major share of the market, Turner said the city also wanted measures to enable lower income households to benefit from the advantages of gigabit speeds and capacity. “We don’t want to create two levels of society here, those who are connected and those who are not,” he said.

While Montrose is a long way from getting every person connected, the community is discussing the idea of financing a network with revenue bonds. 

This election result demonstrates Montrose's desire to be in control of their own connectivity. They understand the need to think of the future. From the Daily Yonder article:

It used to be that if a town wanted to prosper, it needed a river, then a railroad, then an Eisenhower Interstate highway, and then a cell phone tower. Today it needs to be a “gigabit city.”

Tennessee Legislature Considers Four Pro-Muni Bills

Even though there are several publicly owned networks in Tennessee, existing state statutes create barriers discouraging investment. This year, there is a movement at the state Capitol that may change the environment.

The Jolt Digest and CivSource recently reported that four bills aimed at expanding municipal networks in Tennessee have strong support in Nashville. These Tennessee bills are a refreshing change from bills that are pushed by the cable and telephone companies to limit investment in next-generation networks.

However, these bills are often killed quickly in committee or subcommittee due to the tremendous lobbying power of the big cable and telephone companies.

According to the Jolt Digest, two bills are location specific. From the article:

S.B. 2005 and H.B. 1974 would expand the municipal electric system’s provision of broadband service in Clarksville, Tennessee’s fifth largest city, while S.B. 2140 and H.B. 2242 would allow Trousdale County  to contract with a rural electric cooperative to provide broadband services.  

As the rules stands, municipal electric utilities that offer broadband cannot expand beyond their electric service territory. Clarksville would like to reach out further to offer services to schools, hospitals, and industrial parks. CDE Lightband now provides a gig product that community anchors need. According to Christy Batts at CDE Lightband, the network recently upgraded residential customers without raising rates. The lowest Internet access speed available to new customers is now 50 Mbps for $44.95 per month.

The Jolt Digest describes the remaining bills as intended to redefine the state's current definition of "telecommunications." The change would allow electric cooperatives to use their existing dark fiber to reach customers that are not served by rural telephone cooperatives. The goal is to encourage economic development, education and health care.

As we so often find, these bills have bipartisan support. Though Republicans at the state and federal level tend to support big cable and telephone company positions more often than Democrats, both Republicans and Democrats at the local level overwhelmingly support the decision being made at a local level rather than state or federal preemption.

PDFs of the full text of the bills are available online:

SB2005, HB1974 - Affecting Clarksville

SB1240, HB2242 - Affecting Trousdale County

SB2428, HB2364 - Addressing the definition of "telecommunications"

SB2562, HB2482 - Facilitates the expansion of municipal utilities’ broadband services for economic development, education, and health care.

Georgia and Idaho Communities Pass Resolutions in Support of Local Authority

Two more communities recently passed resolutions in support of local authority for broadband networks.

We have written about Ammon and its open access network in southeast Idaho. The municipal network connects anchor institutions and wireless towers in the community of approximately 14,000 people. Chris spoke with Bruce Patterson, Ammon's Technology Director, in Episode 86 of the Community Broadband Bits podcast.

Their Resolution 2014-0005, signed by Mayor Dana Kirkham, reads:

WHEREAS, the universal availability of affordable high speed Internet access for all citizens has been identified as a national priority; and

WHEREAS, community/municipal broadband networks provide an option for market competition, consumer choice, economic development, and universal, affordable Internet access; and

WHEREAS, historically, local governments have ensured access to essential services by banding together to provide those services that were not offered by the private sector at a reasonable and competitive cost. This involvement has included electrification, water supply, public libraries, and other important services; and

WHEREAS, the City Council of the City of Ammon recognize that their economic health and survival depend on connecting the community, and they understand that it takes both private and public investment to achieve this goal; and

WHEREAS, state constitutions and state statutes exist that may limit or prohibit local government deployment of municipal Internet services, which has the potential of prohibiting or limiting the ability of local government to provide important information and services to their citizens in a timely, efficient, and cost effective manner; and

WHEREAS, local governments, being closest to the people are the most accountable level of government and will be held responsible for any decisions they make; and

WHEREAS, the DC Circuit Court has determined that Section 706 of the Federal Telecommunications Act of 1996 unambiguously grants authority to the Federal Communications Commission (FCC) to remove barriers that deter network infrastructure investment;

NOW, THEREFORE, BE IT RESOLVED that the City of Ammon supports FCC efforts to ensure local governments are able to invest in essential Internet infrastructure, if they so choose, without state-imposed barriers to discourage such an approach.

In Georgia, Mayor William M. McIntosh of Moultrie also signed a similar resolution on March 4th. Moultrie is part of the Community Network Services (CNS) region where member towns in Thomas County enjoy the benefits of a municipal network.

We spoke with Mike Scott, Moultrie City Manager, in episode 39 of the Broadband Bits podcast. Scott told us how local government, schools, and residents enjoy services the large corporate incumbents would not provide.

Nearby Thomasville was able to eliminate a city tax due in part to savings and revenue directly related to the network.

CNS Logo

Moutrie's Resolution R03-2014-02 language:

WHEREAS, the universal availability of affordable high speed Internet access for all citizens has been identified as a national priority; and

WHEREAS, community/municipal broadband networks provide an option for market competition, consumer choice, economic development, and universal, affordable Internet access; and

WHEREAS, historically, local governments have ensured access to essential services by banding together to provide those services that were not offered by the private sector as a reasonable and competitive cost. This involvement has included electrification, water supply, public libraries, and other important services; and

WHEREAS, historically, local government leaders recognize that their economic health and survival depend on connecting their communities, and they understand that it takes both private and public investment to achieve this goal; and

WHEREAS, attempts have been made at the state level to limit or stop further local government deployment of municipal Internet services through legislation, which has the potential of reducing the ability of local government to provide important information and services to their citizens in a timely, efficient, and cost effective manner; and

WHEREAS, local governments, being closest to the people are the most accountable level of government and will be held responsible for any decisions they make; and

WHEREAS, the DC Circuit Court has determined that Section 706 of the Federal Telecommunications Act of 1996 unambiguously grants authority to the Federal Communications Commission (FCC) to remove barriers that deter network infrastructure investment;

NOW, THEREFORE, BE IT RESOLVED that the City of Moultrie supports FCC efforts to ensure local governments are able to invest in essential Internet infrastructure, if they so choose, without state-imposed barriers to discourage such an approach.

As more communities pass resolutions, we will share their activities. If your community has officially stated that it supports the FCC in its efforts to restore local authority, let us know so we can spread the word.

Chris Mitchell Hosts March 18th Webinar: Tech in The City

On March 18th, our own Chris Mitchell will host a webinar that you don't want to miss. Tech In the City: A Conversation About Community Broadband Access will be an engaging discussion about municipal networks in light of the recent Verizon v. FCC decision. The court delved into the FCC's authority, clearing up ambiguities from past decisions.

The event, presented by the Media Action Grassroots Network (MAG-Net)'s Community Media Cohort begins at 11 a.m. Pacific / 2 p.m. Eastern. From the event announcement:

Earlier this year, a court order ruled against the Open Internet also known as network neutrality. However, this same order reaffirmed the FCC's role ensuring that communities and cities can create their own broadband infrastructures.

In the last decade hundreds of communities across the U.S have started their own community broadband networks via local governments, cooperatives, or other nonprofit arrangements. But cable and telephone companies, like Comcast and Verizon have a history of redlining in low-income, rural, historically marginalized communities. Led by cohort leader and community broadband expert, Chris Mitchell of Institute for Local Self Reliance, we will have a dialogue about what we can do to protect the future of community broadband networks.

RSVP for the event and spread the word!

On the Media Talks Cable Consolidation, Municipal Networks With Crawford and Baller

The possible merger between Comcast and Time Warner Cable and the FCC's recent announcement to review state barriers have created a significant buzz in the world of telecommunications. Two recent NPR interviews with Susan Crawford and Jim Baller provide insight into how the merger may affect consumers and why a new light is shining on municipal networks.

Crawford spoke with Brooke Gladstone for a recent interview for On the Media. The two addressed some of the consequences of the potential merger. Crawford also discussed the option of municipal broadband investment is an alternative gaining traction. As our readers know, Crawford authored Captive Audience: The Telecom Industry and Monopoly Power in the New Gilded Age. Crawford joined us in a past episode of the Communiy Broadband Bits podcast.

Jim Baller, President of the Baller Herbst Law Group, also joined On the Media when he spoke with Bob Garfield. Baller and Garfield talked about the cable and telecom lobby's efforts to block municipal authority to build networks. Baller supplied a few of the many examples of successful communities that have blossomed as a result of their investment. We have interviewed Baller three times for our podcast.

 

Each interview is a little over six minutes.

Westminster and Chanute Pass Resolutions Supporting FCC's Authority to Remove State Barriers

In light of the recent announcement, community leaders in Maryland and Kansas are rallying behind the FCC as it considers its authority under Section 706 of the 1996 Telecommunications Act. In a show of support, the Westminster Mayor and Common Council passed Resolution 14-01, a statement in support of restoring and preserving local authority to build networks. Twelve hundred miles away in Chanute, the City Commission took the same action with Resolution 2014-17.

Readers will remember Westminster as the central Maryland town that has carefully progressed forward in realizing better connectivity. The community recently approved a fiber pilot project as a way to test the water. Our contact in Westminster, Dr. Robert Wack, reported that interest in the network has blossomed even before the start of construction. The network has already attracted one new employer from New York.

Our 2012 case study, Chanute’s Gig: One Rural Kansas Community’s Tradition of Innovation Led to a Gigabit and Ubiquitous Wireless Coverage, tells the story of how the community incrementally built a world-class network. Without borrowing or bonding, Chanute's next-generation fiber network has enhanced education, economic development, and saved millions of taxpayer dollars.

This legislative session, Chanute has contended with threatening state legislation that could derail their expansion plans. The community is very close to a project that would offer fiber services to every premise in town.

Westminster Seal

Westminster's resolution, passed unanimously on February 24, reads:

RESOLUTION NO. 14-01 RESOLUTION of The Mayor and Common Council of Westminster

SUBJECT: STATEMENT IN SUPPORT OF THE FCC RESTORING AND PRESERVING LOCAL AUTHORITY TO BUILD NETWORKS

WHEREAS, the universal availability of affordable high speed Internet access for all citizens has been identified as a national priority; and

WHEREAS, community/municipal broadband networks provide an option for market competition, consumer choice, economic development, and universal, affordable Internet access; and

WHEREAS, historically, local government leaders recognize that their economic health and survival depend on connecting their communities, and they understand that it takes both private and public investment to achieve this goal; and

WHEREAS, attempts have been made at the state level to limit or stop further local government deployment of municipal Internet services through legislation, which has the potential of reducing the availability of local government to provide important information and services to their citizens in a timely, efficient, and cost effective manner; and

WHEREAS, local governments, being closest to the people are the most accountable level of government and will be held responsible for any decisions they make; and

WHEREAS, the DC Circuit Court has determined that Section 706 of the Federal Telecommunications Act of 1996 unambiguously grants authority to the Federal Communications Commission (FCC) to remove barriers that deter network infrastructure investment;

NOW, THEREFORE, BE IT RESOLVED that the City of Westminster supports FCC efforts to ensure local governments are able to invest in essential Internet infrastructure, if they so choose, without state-imposed barriers to discourage such an approach.

Local Authority

Chanute's resolution was very similar with special attention focused on local authority:

Preserving Local Control and Restoring Community Determination for Broadband Deployment

WHEREAS, local governments, being closest to the people are the most accountable level of government and will be held responsible for any decisions they make; and

WHEREAS, community/municipal broadband networks provide opportunities to improve and encourage innovation, education, health care, economic development, and affordable Internet access; and

WHEREAS, historically, the City of Chanute, has ensured access to essential services by providing those services that were not offered by the private sector at a reasonable and competitive cost. Chanute’s infrastructure investments have included electricity production and distribution, gas distribution, water treatment and distribution, wastewater collection and treatment, sanitation and landfill, streets, parks, and other vital community services; and

WHEREAS, local government leaders recognize that their economic health and survival depend on connecting their communities, and they understand that it takes both private and public investment to achieve this goal; and

WHEREAS, the universal availability of affordable, high speed internet access for all citizens has been identified as a national priority; and

WHEREAS, attempts have been made at the state level to limit or stop further local government deployment of municipal Internet services through legislation, which has the potential of reducing the ability of local government to provide important services to their citizens in a timely, efficient, and cost effective manner; and

WHEREAS, the DC Circuit Court has determined that Section 706 of the Federal Telecommunications Act of 1996 unambiguously grants authority to the Federal Communications Commission (FCC) to remove barriers that deter network infrastructure investment;

NOW, THEREFORE, BE IT RESOLVED that the City Commission of the City of Chanute, Kansas, supports FCC efforts to ensure local governments are able to invest in essential telecommunications infrastructure, if they so choose, without state-imposed barriers to discourage such an approach.

ADOPTED by the Governing Body on February 24, 2014.

Communities know their futures depend on the ability to bring fast, affordable, reliable access into their community. Because local leaders recognize that large corporate providers seldom build past low hanging fruit, a growing number now invest in their own infrastructure.

Utah Senate Bill Attacking UTOPIA on the Fast Track: SB190

UPDATE: According to Pete Ashdown, the amendment has been pulled. Stay vigilant, these things rarely just go away.

We reported earlier this month that UTOPIA was once again facing legislative attack at the state level in the form of HB60. While the House has focused on other issues, the Utah Senate is launching its own attack. SB190 has also put UTOPIA in the crosshairs and events are happening quickly. Time to contact your elected officials, Utah!

According to Jesse Harris at FreeUTOPIA.org, SB190 as originally crafted, could have curtailed a pending deal between UTOPIA and Australian firm Macquierie. From Harris' February 19 story on the bill:

It appears the legislature is determined to chase off a $300M investment in our state’s broadband infrastructure to appease CenturyLink. Sen. John Valentine is running SB190 which has been very specifically crafted to prevent any UTOPIA city from using the same utility fee that Provo has to pay down the bonds. Moving to a utility fee to provide transparency on the cost of the UTOPIA bonds has been a key part of the Macquarie discussions so far, so it could very well put the deal in jeopardy.

Since its introduction, the bill was heard in the Senate Business and Labor committee. There was broad and fierce opposition and Sen. John Valentine, the sponsor of the bill, amended it. The changes made the bill palatable to Macquarie and it passed through committee to the Senate Floor on Feb. 24.

After the bill passed through the committee, Valentine introduced a floor amendment that will prevent new cities from joining the network. Harris now reports:

His floor amendment to SB190 makes it so that only current UTOPIA cities can use a utility fee to finance construction of the network. Any new cities that join would be unable to do so at all.

Why does this matter? Because Macquarie has structured the entire deal around it. If future cities can’t do it, they can’t get the same terms that Macquarie is offering UTOPIA. This could derail their rumored plans to cover the entire state in gigabit fiber with over a dozen competing providers.

The bill is now awaiting a vote on in the Senate. It is imperative that you contact the Senate, especially your own elected offical, to voice your opposition to the bill in its current form.

These types of end runs around legislative procedure are common place. In my own limited experience working at the state legislature, I have seen contentious sections of proposed bills added or removed to make a deal, only to be added or removed later on the floor and during conference commitee. In places that do not have a full time legislature, changing proposed legislation on top of a deadline is an effective way to take advantage of the clock to achieve an unpopular goal. It is important to remember that legislation is fluid until the gavel comes down sine die.

KKFI in Kansas City Interview Mitchell and Todd O'Boyle on Kansas Legislation

On February 13, KKFI Community Radio from Kansas City, Missouri, interviewed ILSR's Chris Mitchell and Todd O'Boyle from Common Cause. Tom Klammer, host of the "Tell Somebody" show covered Kansas legislation SB 304 aimed at preventing municipalities from investing in their own broadband networks.

Chris and Todd co-authored our 2013 case study, The Empire Lobbies Back: How National Cable and DSL Companies Banned The Competition in North Carolina. They reviewed the events in Wilson, North Carolina, home of municipal network Greenlight. As in Kansas, powerful cable company lobbyists attacked municipal networks in North Carolina through the state legislature.

Klammer writes on the program website:

Recently Todd O’Boyle of Common Cause brought my attention to a Kansas Senate bill, authored by a cable industry lobbyist, which would outlaw community broadband in Kansas.  Subsequently I came across an article online written by O’Boyle’s colleague Christopher Mitchell who wrote that the bill in question, if passed, would create some of the most draconian limits on building networks that we have seen in any state.

You can listen to the interview from the program website. The interview is a little under one hour.