Over the summer, Oregon took a second swing at revising its state Universal Service Fund program by passing SB 1603, a bill which will create a larger rural broadband development fund by including retail wireless and VoIP service (in addition to traditional telephone service) in the fees it collects to bring basic connectivity services to unconnected parts of the state. The new law lowers the current tax rate on telecommunications service provider's gross revenue (from 8.5% to 6%) but dramatically broadens the collection base, which will bring in needed dollars to expand broadband access to state residents without it in coming years. The move comes on the heels of the state’s move to establish a Broadband Office in 2018 to “to promote access to broadband services for all Oregonians in order to improve the economy and quality of life.”

Nuts and Bolts

SB 1603, which passed the state legislature on June 26 and was signed into law on July 7, directs the Oregon Business Development Department  (OBDD) to transfer up to $5 million of the funds collected each year to a broadband fund for rural development projects, administered by the OBDD. While the amount that will be collected remains unknown at the moment, it will no doubt represent a significant boost: the current mechanism for funding rural information infrastructure projects — the Rural Broadband Capacity Pilot Program — received 25 applications for almost $5 million in requested funding, but was only able to grant $500,000, or 10%. SB 1603 caps the money to be collected by the Oregon Universal Service Fund at $28 million annually.

As a result of SB1603, Oregonians can expect the average cell phone bill would go up by about $4 a year, and those with landline telephone service will see an annual decrease of $12 a year. Some VoIP providers had contributed willingly prior to the bill — that voluntary opt-in is removed.

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Granite Staters with poor Internet access in rural areas should soon realize the benefit of HB 1111, which just passed the state legislature and was signed into law by the governor. The measure provides for the establishment of communications districts to pursue Internet infrastructure projects in New Hampshire. In addition, the law makes it easier for municipalities to determine which areas under their purview are unserved in order to target broadband expansion efforts and expand access to all. 

Removing Barriers, Providing New Tools 

Two years ago SB 170 passed the legislature, allowing communities in the state to bond to develop publicly owned Internet infrastructure for the first time. The bill, however, made such moves contingent upon proving that the proposed areas were “unserved” by a connection of 25/3 megabits per second (Mbps). To do so local governments were required to issue an RFI to the existing Internet Service Provider (ISP). At the time we anticipated trouble with existing providers who had a history of claiming service to large areas when the reality was that many were unserved, and it turns out that worry was well-founded: communities reported that ISPs were ignoring requests for information, making it difficult for them to make progress. 

HB 1111 changes that. If an RFI to a provider goes unanswered for 60 days, it is assumed the latter is unable to deliver broadband. Municipalities can then come together and form communications districts which have the authority to use general obligation bonds to fund an overbuild of the area and seek out public-private partnerships to provide new service.

“Access to consistent broadband and high-speed internet was a problem long before this crisis and the remote learning, work, and health care environment has only exacerbated those inequities,” State Senator Jay Kahn told news outlets. “As we prepare for the possibility of a second wave, we must take steps that efficiently use public funds to leverage private investment to deliver high-...