Tag: "preemption"

Posted September 10, 2014 by tanderson

In an excellent piece titled “How Republicans Flip-Flopped on Government-Run Internet,” the National Journal outlines the disappointing political evolution of municipal broadband, from a bipartisan local choice issue to an anti-Obama Administration, pro-incumbent telecom, states’ rights issue. 

It was not so long ago (2005, to be precise) that three Republican senators (John McCain, Lindsey Graham, and Norm Coleman) joined three Democrats in sponsoring legislation that would enshrine the principle of local choice explicitly in law, preempting anti-muni state laws pushed by incumbent lobbyists. A year later, 215 House Republicans voted for a bill that included a similar preemption provision. In 2007, even more Republican Senators joined McCain and Graham, including Olympia Snowe, Ted Stevens, and Gordon Smith. Their communications bill, including local choice provisions, narrowly missed becoming the law of the land due to fights over unrelated net neutrality issues. 

Yet somehow, in 2014, we have the Blackburn anti-muni amendment passing the House floor with nearly unanimous Republican support: 223-200. There are multiple reasons for this, including the generational shift in the Republican Party away from moderates like McCain and towards the more insurrectionist Tea Party. The Journal article also cites the ubiquitous hostility to anything associated with President Obama, even extending to statements made by his nominees at the FCC in favor of federal preemption. Ever greater lobbying spending by cable and telecom incumbents has helped muddy the water for municipal broadband as well.

Yet even some of the same Republicans who once supported local choice now oppose it. Rep. Fred Upton of Michigan, the current and former Chairman of the House Energy and Commerce Committee that handles communications issues, was one of the leading figures in pushing the bill that included preemption in 2006 and 2007. In 2014, he joined his caucus in voting for Blackburn’s amendment to stop such preemption. From the Journal:

An Upton spokesman claimed there's nothing inconsistent about supporting a bill to nullify state restrictions and opposing FCC action that would do the same thing.

"Voters...

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Posted September 9, 2014 by tanderson

The Boulder Chamber of Commerce has come out in favor of ballot measure 2C, which would restore the City of Boulder's authority to provide telecommunications services to its residents. From the Chamber's website:

City of Boulder 2014 Ballot Measure 2C – Affirming the City’s Right to Provide Telecommunication Services

Colorado State Bill 152 precludes cities from offering broadband services without an exemption provided by a vote of the people. Boulder currently has over 100 miles of fiber-optic cable providing high-speed Internet capabilities to city offices, the University of Colorado and the federal labs.  If 2C passes,  the City would be granted the authority to expand that network to residents or businesses.

The Boulder Chamber has taken a leadership role on 2C, stating: “[P]artnership with the private sector may well represent the fastest, most seamless path to providing service to our residents and students, and to attracting and retaining the companies that drive our innovation economy. And there are partners in the community who could leverage such an opportunity.”

Local business communities are often the first to benefit from the cheaper, better, faster service when municipalities expand their networks. As the Chamber's statement notes, Boulder already has over 100 miles of fiber installed but is blocked from leveraging those assets by SB 152, which effectively outlaws community networks unless voters pass a referendum restoring local authority. Because deep-pocketed incumbents typically spend heavily to defeat such referenda and public agencies are blocked from lobbying on their own behalf, support from local groups like Chambers of Commerce are crucial.

Boulder stands to join the ranks of Longmont, Centennial, Montrose, and other Colorado communities that have voted to restore their local authority. So far, despite the obstacles and incumbent spending, every Colorado municipality that has put the issue on the ballot has passed it - eventually. 

Posted August 21, 2014 by tanderson

REMINDER - Today is the last day to file comments in the opening round of the FCC petitions of Wilson and Chattanooga. Information on how to file here.

Last month, we covered the progress of U.S. Representative Marsha Blackburn’s amendment to strip the FCC of its authority to restore local decision-making as its budget wormed its way through committee and into a larger appropriations bill. Her quest to keep state bans and restrictions on community networks in place (including in her home state of Tennessee, where Chattanooga EPB has filed a petition to start serving neighbors in need) is impressive for its boldness, if not its logical consistency. Impervious to many observers and commenters who noted her extensive financial support from incumbent telcos, she succeeded in passing the amendment on the House floor by a vote of 223-200.

The points raised by Representative Blackburn on the House floor in support of her amendment deserve some attention, as does the rebuttal offered by Representative Jose Serrano of New York’s 15 district, who rose against the amendment and in defense of the right of local communities to decide for themselves how to meet their broadband needs. Few of Blackburn’s arguments will surprise regular observers of the telco incumbent playbook, but there are some highlights that deserve special focus.

Rep. Blackburn based nearly her entire argument against FCC preemption on the idea that states are closer to the people than Washington, and that the FCC shouldn’t tell the local folks what to do:

“[Chairman Wheeler] wrongly assumes that Washington knows best, and forgets that the right answer doesn’t always come from the top down.”

“...Twenty states across this country have held public...

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Posted August 14, 2014 by tanderson

SB 152, the telecom incumbent-supported Colorado law that restricts municipalities from building broadband networks or even partnering with other entities to do the same, is increasingly coming under fire. The City of Longmont passed a referendum to restore its local authority in 2011 and has started construction on a project that will make it Colorado's first gig city.

Centennial and Montrose voters have chosen to restore their authority as well. Boulder plans to put a similar measure to the test in elections this fall. So far, every community in Colorado that has put restoring local authority on the ballot has gotten it done - despite heavy incumbent spending and astroturf activism.

Now, an editorial in the Denver Post has called even more attention to the issue of SB 152 and the anti-competitive, undemocratic environment it has created in the State of Colorado: 

The statute created by SB 152 needs to go away. While civic and business leaders tout ambitious projects to connect the state with the rest of the world, Colorado is falling behind because of artificial constraints to broadband expansion.

Longmont pioneers saw past all of that and pushed through, even in the face of well-financed opposition. A few other communities are starting to see the advantage of bucking SB 152.

Longmont's Roiniotis says the question he hears almost constantly is, "When am I going to get my gig?"

It is a question the entire state should ask.

We couldn't have said it better ourselves. 

Posted August 1, 2014 by lgonzalez

The Institute for Local Self-Reliance recently submitted comments to the FCC as part of its Protecting and Promoting the Open Internet proceeding. ILSR focused on the issue of paid prioritization, reclassification, and regulation of content. We also provided some examples of municipal networks that provide fast, reliable, affordable service and do not rely on paid prioritization to serve customers.

From the ILSR comments:

The FCC should be extremely wary of any arguments that claim paid prioritization or other discriminatory practices are necessary to increase investment in next-generation networks. These networks are already being built and paying for themselves in both public and private approaches (as well as partnerships mixing the two). ILSR sees no reason to believe any additional revenues gained by discriminatory pricing would be reinvested in improving DSL and cable networks as the largest firms operating these networks generally face little competitive pressure to upgrade. That is the problem, not a lack of revenue in the current model.

Our reading of the various court decisions suggest the only option for the FCC to preserve the open Internet and prevent big cable and telephone companies from tinkering with the established principle of non-discriminatory carriage is reclassification and urge the FCC to take this step. However, we also urge the FCC to take actions to prevent any regulation of content. The FCC should concern itself with the transmission of information, regardless of what that information is, consistent with long-held Internet principles.

The Open Internet proceeding has inspired an estimated 1 million+ comments. The outpouring strained the FCC's system and as a result, the FCC extended the comment period to July 18th.

The full document is available below for download and available on the FCC's electronic filing system.

Posted July 31, 2014 by christopher

For the first time in many years, we have an opportunity to repeal some particularly destructive state laws limiting investment in community networks. To be clear, this is our best shot. I've already covered the background and offered a blanket encouragement for you to post comments.

Chairman Wheeler has been looking for an opportunity to expand local authority by removing state laws that limit investment in Internet networks. The cable and telephone companies are marshalling their considerable forces to stop him. But we can, and must help.

We have spent years analyzing these state barriers for ways to restore local authority. The FCC, using its Section 706 power, is our best shot. The carriers have far too much power in the state capitals, which means that even when we have public opinion squarely on our side, the carriers easily kill state bills to restore local authority.

Anyone who thinks we have a better shot at rolling back state barriers individually in the states rather than with this FCC is wrong. Really wrong. Between Art Pope and Time Warner Cable lobbyists, there is no hope for any legislation that would threaten cable monopolies in North Carolina.

These petitions on municipal networks are not some FCC smokescreen related to the network neutrality proceeding. In fact, we at ILSR remain publicly frustrated with the FCC's failure to act more strongly in protecting the open Internet. But Chairman Wheeler, for reasons that seem somewhat personal to him, is particularly motivated to remove the anti-competitive laws passed by big cable and telephone company lobbyists. It strikes a chord with him and I, for one, am glad to see him taking action on it.

Anyone who claims action on municipal networks is some sort of trade for giving up on network neutrality is, once again, really wrong. For one thing, a trade requires two parties and I have yet to identify a single entity that would trade meaningful open Internet protections for rolling back a few barriers to municipal networks. Haven't found one. Not even us.

Further, restoring local authority on municipal networks is not a trade for the FCC later preempting local authority over the rights-of-way because once again...

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Posted July 31, 2014 by lgonzalez

Sallisaw, home of DiamondNet, is the latest community to publicly express its desire to put telecommunications authority in the hands of the locals. On July 14, the Sallisaw Board of City Commissioners approved Resolution 2014-17 in support of the FCC's intention to preempt state anti-muni laws.

A Resolution Supporting Telecommunications Infrastructure For Local Governments

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 Sallisaw has ensured access to essential services by providing those services that were not offered by the private sector at a reasonable and competitive cost; and

WHEREAS, in 2004 the City of Sallisaw took steps to construct its own Fiber to the Premise telecommunications system and now provides the community with quality state-of-the-art broadband services including video, High Speed Internet and telephones services, that otherwise would not be available today; 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 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 Board of City Commissioners of the City of Sallisaw, Oklahoma, 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 14th day of July, 2014.

When City staff began researching the possibility of a municipal network in 2002, they discovered that dial-up was the only option for residents; businesses had the option of T1...

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Posted July 30, 2014 by tanderson

Wabash County, Indiana wants to expand its access to high speed internet through a fiber optic network build out, and is planning to use a distinctive financial tool to do so. The Wabash County Redevelopment Commission has begun the process of assigning a special Economic Development Area designation for the purpose of helping to finance new fiber deployment through parts of the mostly rural county of 33,000 people.

Tax Increment Financing (TIF) is a method of public financing that uses future gains in property or sales taxes within a defined area to subsidize a redevelopment or infrastructure project. A local jurisdiction can borrow money up front, build the project, and then use the increased tax receipts it generates to pay off the debt over a period of years. The concept is actually pretty simple: capture the value that something will have in the future to build it now.

TIF  has been a popular approach among local politicians around the country for decades as a way to work around tight budgets and finance improvements in blighted areas, often in the form of public infrastructure. It has sometimes drawn criticism, especially in cities like Chicago where it is very heavily used. One downside is that it effectively takes properties off the general tax rolls. 

More important for our purposes, however, is that the use of TIF for next generation fiber optic networks is a fairly new phenomenon. While municipal networks around the country have used a wide range of financing approaches to cover upfront costs, most have revolved in some way around bonds that are repaid from network revenue. Using TIF to capture the increased property value that a fiber optic network would create is an interesting approach.

In the case of Wabash County, it’s not yet clear exactly how the funds would be used. There is a local private incumbent provider, Metronet, which received $100,000 last year to match its own $1 million investment to bring fiber to a town on the north edge of the county. The county also has a cooperative utility (Wabash County REMC) that provides power and telephone services in rural areas and has expressed interest in using TIF to build out a fiber network. Whichever entity ultimately receives TIF money, it does not appear that...

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Posted July 25, 2014 by lgonzalez

On June 18 Holly Springs, home to approximately 25,000 people, started saving money with its new fiber I-Net. Last summer, the Town Council voted to invest in fiber infrastructure as a way to take control of telecommunications costs. Just one year later, the 13-mile network is serving community anchor institutions.

After exploring options with CTC Technology and Energy, Holly Springs determined that deploying their own $1.5 million network was more cost effective than paying Time Warner Cable for data services. Annual fees were $159,000; over time those costs certainly would have escalated. According to the Cary News, Holly Springs anticipates a future need for more bandwidth:

“And we wouldn’t have been able to actually afford as much (data) as we need,” [Holly Springs IT Director Jeff Wilson] said. “Our costs were going to be getting out of control over the next couple of years.”

Because state law precludes the town from offering services to homes or businesses, Holly Springs plans to use the new infrastructure in other ways. State law allows the community to offer free Wi-Fi; the town will also lease dark fiber to third-party providers. According to the News article, the town has already entered into a 20-year contract with DukeNet, recently acquired by Time Warner Cable. DukeNet may expand the fiber to the Holly Springs Business Park for commercial clients.

The community's free Wi-Fi in public facilities is approximately 20 times faster than it was before the deployment, reports the News:

When the town activated the network on June 18, “People told us they could tell the difference immediately,” said Jeff Wilson, Holly Springs’ IT director.

According to the News, the fiber network allows the city to expand free Wi-Fi to more green spaces. Cameras at baseball fields now stream live video of games; parents and grandparents can watch activities online if they cannot attend games in person.

For more on the community and the project, check out Chris' conversation with Jeff Wilson in...

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Posted July 24, 2014 by christopher

Chattanooga and Wilson, North Carolina, are two of the most successful municipal fiber networks by a variety of metrics, including jobs created, aggregate community savings, and more. This has led to significant demand from surrounding communities for Wilson and Chattanooga to expand. We have profiled both of them in case studies: Wilson and Chattanooga.

Expecting this outcome, the big cable and telephone companies had pressured the states to limit where municipal networks can offer service, unlike the private companies that can invest anywhere. Wilson cannot expand beyond county limits. Chattanooga already serves its entire electrical footprint, which stretches into northern Georgia and includes a few other towns but cannot serve anyone beyond that.

FCC Chairman Wheeler has been quite clear that he intends to remove barriers to competition that limit local authority to build community networks.

Today, Wilson and North Carolina have filed petitions with the FCC to remove restrictions on their ability to expand and offer services to nearby communities. These barriers were created after major lobbying campaigns by Comcast, AT&T, and Time Warner Cable, one of which we chronicled in The Empire Lobbies Back. We have also explained how the FCC can take this action and interviewed Harold Feld on the matter.

Read press statements from Chattanooga EPB and Wilson, North Carolina [PDF below]. Also, take a look at Wilson's Full Petition and Exhibits and...

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