Municipal networks in the United States have proven that when dollars are invested in publicly owned information infrastructure, they often return value back to the community several times over. This new fact sheet [pdf] highlights municipal broadband success stories from across the country and some of the many benefits the networks have brought to the communities they serve. 

These networks are directly accountable to the community and have proved themselves for more than 20 years in some cases, bringing lower prices to households than the large private providers. Municipal networks and partnerships account for 9 of the top 10 fastest broadband networks in the nation.

Download Snapshots of Municipal Broadband: A Much-Needed Part of America's Digital Ecosystem [pdf] here.

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Since it was first introduced in Congress in March, the Community Broadband Act of 2021 has gained widespread support from over 45 organizations representing local governments, public utilities, racial equity groups, private industry, and citizen advocates. 

The legislation -- introduced by U.S. Representatives Anna Eshoo, Jared Golden, and U.S. Senator Cory Booker -- would authorize local communities to build and maintain their own Internet infrastructure by prohibiting laws in 17 states that ban or limit the ability of state, regional, and local governments to build broadband networks and provide Internet services. 

The Act also overturns state laws that restrict electric cooperatives' ability to provide Internet services, as well as laws that restrain public agencies from entering into public-private partnerships.

States have started to remove some long-standing barriers to public broadband on their own. In the last year, state lawmakers in both Arkansas and Washington removed significant barriers to municipal broadband networks, as high-quality Internet with upload speeds sufficient for remote work, distance learning, telehealth, and other online civic and cultural engagement has become essential. 

Community broadband networks offer a path to connect the unconnected to next-generation networks. State barriers have contributed to the lack of competition in the broadband market and most communities will not soon gain access without public investments or, at the very least, the plausible threat of community broadband.

The Many Benefits of Publicly-Owned Networks

It’s official. Senate Bill 74 became law last week when Governor Asa Hutchinson signed it, significantly reducing (but not completely removing) barriers to municipal broadband in the state of Arkansas, with both chambers voting unanimously in approval of the legislation. While the legislation doesn’t completely eliminate existing barriers to municipal broadband in the state, we consider it an historic moment and a significant step forward.

The central win in SB 74 is that it allows government entities “to acquire, construct, furnish, or equip facilities for the provision of voice services, data services, broadband services, video services, or wireless telecommunications services” so long as they “partner, contract, or otherwise affiliate with an entity that is experienced in the operation of the facilities,” as well as conduct due diligence, and provide ten-days’ notice and hold a public hearing.

Importantly, it also allows municipalities to issue general obligation bonds or impose special taxes to do so; prior, they could only do so after acquiring third-party funding through grants or loans. Finally, the legislation also expands the emergency provisions clause to include health and public safety operations.

SB 74 was first filed in early January, making its way through the Agriculture, Forestry, and Economic Development Committee before returning to the floor in the third week of the month. There it was amended once more to remove language expressly permitting municipalities from construction, owning, and operating broadband networks, leaving the law a bit unclear where local authority ends. We, along with the Coalition for Local Internet Choice, take this to mean that municipalities without electric utilities that try build communications facilities to do retail service could run into some legal challenges. On the whole however, SB 74 remains a significant win for municipalities to pursue projects. 

Director of Community Broadband Networks Christopher Mitchell had this to say:

Chickens, peaches, and college students. Those may be the first things that come to mind if you have ever visited Clarksville, Arkansas – a small town of about 9,200 residents situated at the foot of the Ozarks.

Clarksville’s largest employer is a Tyson poultry facility. Every summer, Clarksville hosts the oldest food festival in the state, the annual Johnson County Peach Festival (which was cancelled in 2020 because of the COVID-19 pandemic). And, just two blocks north of downtown Clarksville is The University of the Ozarks, which gives Clarksville a bit of that college town flavor.  

But, if you ask Clarksville Connected Utilities (CCU) Business Development Director Barry Sellers, he will tell you: “the biggest thing we have [in Clarksville] is this fiber network. That’s why we put up a billboard right off I-40 that says: ‘Clarksville is Arkansas’ first two gig city.’ I get calls weekly asking if it’s true.”

Yes, it’s true. Last summer CCU began the last step of a Fiber-to-the-Home (FTTH) build-out with the project already nearing completion.

“We are starting to light people up, about 200 so far. We should be able to have 1,000 customers lit up and being served before end of 2021,” CCU GM John Lester told us last week, adding that they have a 30% take-rate so far and are hopeful that as many 50% of the city’s 4,300 potential residential and business customers will sign up for service within the next 3 to 4 years.

Birth of a Network

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It was in 2013 that CCU operators were looking for a way to provide better connectivity for its utility operations and its Supervisory Control and Data Acquisition (SCADA) systems, which monitors and manages its utility infrastructure. After studying what kind of network to put in place, CCU found that a fiber network would be the best fit.

Conway is right in the middle – in the middle of Arkansas with its utility company, Conway Corp, in the middle of beefing up its broadband network.

In this city of 66,000 – home to the information technology company Acxiom Corporation and three colleges – residents and businesses have long relied on Conway Corp for more than just electricity since the utility first launched its cable and Internet service in 1997.

Conway Corp, which has been Conway’s electric utility for the past 90 years, has a unique relationship with the city’s government. “We are different in the way we are set up as compared to many other municipal networks. We are set up as a non-profit. We lease the network and operate it on behalf of the city,” explained Conway Corp Chief Marketing Officer Crystal Kemp.

At the heart of the utility’s network management has been the on-going work to stay ahead of the curve.

Prepared for the Pandemic

“When we launched Internet services in 1997, upstream capacity wasn’t a concern and systems were built with the average homes (and) businesses per geographic area, or node, at 500. Today those numbers are less than 95 per node. That’s been achieved through physical changes in the network and changes in our engineering practices,” Conway Corp’s Chief Technology Officer Jason Hansen told us last week. 

Upgrades to the Hybrid-Fiber-Coax (HFC) network began to take shape in 2019 with the deployment of DOCSIS 3.1, allowing Conway Corp to double its downstream capacity. They also began upgrading equipment that paved the way for expanded use of the RF (Radio Frequency) spectrum to boost the network’s bandwidth. As of December 2020, about 50 percent of the upstream upgrade work had been completed with the remainder expected to be finished by the summer of 2021.

On Monday, a new bill introduced into the Arkansas State Legislature has the potential, if passed, to remove almost all existing barriers to municipal broadband in the state. SB 74 was introduced in the 93rd General Assembly, Regular Session 2021 by State Senators Breanne Davis and Ricky Hill and their counterparts Representatives Brian Evans and Deann Vaught. 

The legislation would substantially amend the state’s Telecommunications Regulatory Reform Act of 2013, which in most scenarios bans government entities from building and owning networks and delivering services to residents in pursuit of promoting competition and bringing Internet access to unconnected parts of the state.

SB 74 keeps an existing ban on providing basic local exchange service in place (i.e. telephone), but otherwise allows municipalities to build, buy, and operate network infrastructure to deliver digital voice, broadband, data, and wireless telecommunications service to anyone in the state. 

Slow Progress in Recent Years

Currently in Arkansas, municipalities are allowed to build or partner with private companies to build broadband infrastructure, but only if they acquire a grant or loan to do so and only do so in unserved areas. When policy veterans last commented on these particulars of the legislative landscape in 2019, they were worried that such geographic and financing restrictions would effectively preclude new networks, and they were right. 

SB 74 eliminates these two restrictions, which represents a significant step forward. It also adds consolidated utility districts to the list of eligible entities, removes the requirement to file a public notice, and dramatically expands the emergency services clause to include healthcare services, education, and “other essential services.”

A host of cities and counties in Arkansas are about to get a major broadband boost thanks to local officials taking steps to act on a grant program deployed by the state last year. Borne out of the state’s 2020 1st Extraordinary Session at the end of March 2020 in response to the Covid 19 pandemic, the new Rural Broadband I.D. Expenses Trust Fund Grant Program will disburse $2 million in funds divided into 30 one-time grants of $75,000 each to towns, cities, and counties to tackle the digital divide in the Toothpick State. The program is financed via Arkansas’ Restricted Reserve Fund with money given to the state by the CARES Act, and is administered by the University of Arkansas for Medical Sciences (UAMS) Institute for Digital Health & Innovation. And while an array of projects have been awarded funds, money remains available and applications are being accepted on a rolling basis for those who have yet to take advantage.

A Win for Local Self-Reliance and Increasing Competition

The program is expressly designed to bridge the gap for communities that want to begin to improve local Internet access but are stymied by a necessary first step: paying for those economic, design, and feasibility analyses which require pulling together the wide range of options available in the context of local conditions. That’s where this program comes in, according to Rachel Ott, the UAMS Institute’s for Digital Health and Innovation Grant Director. Communities can use the work produced to apply for federal grants down the road, including the recently concluded Rural Digital Opportunity Fund (RDOF), the U.S. Department of Agriculture’s ReConnect Program, funds from the Agriculture Improvement Act of 2018, and any other forthcoming federal funding programs. 

All across the country, municipal networks, cooperatives, and cities have been putting in extra effort to make sure that Americans have the fast, affordable, reliable Internet access they need to conduct their lives in the midst of the COVID-19 pandemic. 

AT&T has decided to take another route. A USA Today report last week revealed that the company has stopped making connections to users subscribing to its ADSL Internet as of October 1st. Anyone calling the company to set up new service is being told that no new accounts are being accepted. 

The decision comes right as the National Digital Inclusion Alliance has released a report detailing that only 28% of AT&T’s territory can get fiber from the company. AT&T has deliberately focused investment in more urban areas of higher income. From the report:

The analysis of AT&T’s network reveals that the company is prioritizing network upgrades to wealthier areas, and leaving lower income communities with outdated technologies. Across the country, the median income for households with fiber available is 34 percent higher than in areas with DSL only — $60,969 compared to $45,500. 

The Deep South Hit Hardest

As of today, it looks like the most conservative number of those affected by the decision will be about 80,000 households that have no other option. Our analysis using the Federal Communication Commission’s (FCC) Form 477 data shows that the Deep South will be hit the hardest (see table at the bottom of the page). 

Collectively it means more than 207,000 Americans who, if disconnected, will have no option for Internet aside from their mobile devices or satellite service. The number of Americans affected by the decision but which have additional wireline options is higher: roughly 2.2 million American households nationwide subscribe to the service (see map, below).