Ohio Budget Amendment Aims to Kill Municipal Broadband

The Ohio State Senate is set to vote today on the state budget bill that includes an amendment which, if signed into law, would be a major setback for municipal broadband projects in the Buckeye State and protect the big incumbent Internet Service Providers from competition. 

If passed and signed into law it would make Ohio the first state in a decade to erect barriers to the establishment and expansion of municipal broadband networks. This is a surprising and disappointing move, especially for families who have spent the last year experiencing firsthand the poor Internet connectivity that comes with a broadband market dominated by monopoly providers with no incentive to put the interests of the public ahead of shareholder returns.

Erecting Barriers

When the Senate version of the state budget bill was unveiled earlier this week, it included an amendement with an array of conditions designed to prevent, stifle, and discourage cities from following through with any plan for a city-run network to meet the connectivity challenges of its residents.

The first is a provision that would only allow for municipal broadband networks to be built in “unserved” areas of the state, defined as geographic regions where residents do not have access to “broadband service capable of speeds of at least 25 Mbps downstream and at least 3 Mbps upstream.”

But a recent Ohio Broadband Strategy report released in 2019 under the direction of Ohio Lt. Gov. Jon Husted pegged the number of Ohioans without access to broadband at just around 1 million. According to the independent broadband tracking firm BroadbandNow, which ranks Ohio 24th in the nation on the broadband access scale, as of June 2021 there were 618,000 Ohio residents who did not have access to broadband with speeds of 25/3 or faster, which means that approximately 94 percent of Ohioans have access to wired broadband with speeds of 25/3 or faster. Restricting municipal networks to only those households with no service whatsoever would effectively preclude new networks in large parts of the state.

Broadband access is one thing, but municipal networks also exist to bring competition into markets dominated by incumbent monopoly providers and result in lower prices and increased local accountability. As it relates to affordability in Ohio, according to BroadbandNow, only 47.7 percent of Ohio residents have access to Internet plans at less than $60 per month, which is a lower percentage than the national average of 51.5 percent of Americans with access to plans less than $60 per month.

The last minute budget amendment also prohibits municipalities from offering broadband service outside of its municipal boundaries and requires any new proposed network to have a business plan that does not use local tax revenues to fund construction. Furthermore, the amendment would prevent municipalities from accessing federal funds just as the American Rescue Plan is pouring billions of dollars into state and local government coffers to invest in broadband infrastructure.

Opposition

In an email sent out Tuesday afternoon, Vice President of External Affairs for the nonprofit American Municipal Power (AMP) and the Ohio Municipal Electric Association, Michael Beirne, wrote that the amendment was “of great concern” because it “would effectively ban municipal broadband projects.”

“Please contact your state senator today and tomorrow morning to request they remove this onerous and detrimental provision,” he urged community broadband advocates in the state.

The budget amendment is a direct shot at the City of Columbus, which has been working to bring broadband to the many families in the city that have been left behind by the private sector in which as many as 1 in 4 students have not been able to fully participate in remote learning because of poor Internet connectivity.

As is the case in most cities across the nation, a major barrier to broadband access in Columbus is affordability, which the proposed Senate budget amendment does not address. The affordability gap is why city officials last year initiated a pilot program that offers a wireless connection to two low-income neighborhoods on the South Side and the Near East Side that would provide up to 200 homes with download speeds of up to 30 Mbps service for $15 to $25 a month. 

If the budget amendment passes and is signed into law, it would put Ohio on the ignominious list of states that outright ban or erect barriers to municipal broadband networks. Currently, there are 17 states with such anti-competitive laws in place, though in the past year two states - Washington and Arkansas - reversed legislation that had previously restricted public entities from building and operating municipal networks.

Read the amendment here, below.

Read our new fact sheet [pdf] on all the ways Ohio's community networks have brought value to the state.

Header image by Wikimedia Commons user MJ CC BY-SA 4.0

Inline image by Wikimedia Commons user Antony-22 CC BY-SA 4.0