Even as high-speed Internet access is widely considered a basic utility akin to electricity and clean water, there are still 17 states with preemption laws that either ban publicly-owned broadband networks or have barriers that make it all but impossible for municipalities to compete with monopoly Internet Service Providers. This, despite the major incumbents having received billions in taxpayer subsidies over the years and having failed to deliver universally reliable and affordable connectivity.

However, as it has become increasingly clear that the private market alone is not going to solve America’s connectivity crisis, last year two states (Arkansas and Washington) rolled back their preemption laws that were protecting monopoly incumbent providers from competition, allowing local and regional governmental entities to build the telecommunications infrastructure their residents need.

Now, one Nebraska lawmaker has recently filed a bill that, if passed, would significantly remove his state’s current barriers to municipal broadband. Nebraska State Sen. Justin Wayne of Omaha filed LB916 last week with the state legislature’s Transportation and Telecommunications Committee.

As it stands now, according to the Coalition for Local Internet Choice (CLIC), Nebraska “generally prohibits agencies or political subdivisions of the state, other than public power utilities, from providing wholesale or retail broadband, Internet, telecommunications or cable service. Public power utilities are permanently prohibited from providing such services on a retail basis, and they can sell or lease dark fiber on a wholesale basis only under severely limited conditions. For example, a public power utility cannot sell or lease dark fiber at rates lower than the rates incumbents are charging in the market in question.” 

Bill to Let Local Communities Decide on Broadband

The Institute for Local Self-Reliance has partnered with Southeast Nebraska Development District (SENDD) and the Nebraska Economic Developers Association (NEDA) to present a broadband seminar series to provide education to local elected officials, economic developers and other stakeholders. The series covers everything from the basics of broadband infrastructure and technology to financial models to the longterm benefits of investing in fast, reliable Internet access.

The series was developed by Christopher Mitchell, in collaboration with SENDD and NEDA, and produced and edited by ILSR Senior Researcher and Multimedia Producer Maren Machles.

Episode 1

In the first episode, Christopher introduces broadband technology and terminology, including network basics, infrastructure development, and business models. 

 Episode 2

In the second episode, Christopher is joined by Brent Comstock (CEO and Founder, BCom Solutions), Thomas Magnuson (Geriatric Psychiatrist at University of Nebraska Medical Center), Kyle Arganbright (Mayor of Valentine, NE and Executive Vice President and co-founder of Sandhills State Bank), and Brook Aken (Economic Development Manager, Omaha Public Power District) to discuss the longterm benefits of fast, reliable broadband on everything from economic development to telehealth. 

Episode 3

Christopher is joined by David Young, Chief Information Officer for the City of Lincoln and Lancaster County in the third episode of the series. The two give guidance on state and federal broadband programs as well as barriers, challenges, and solutions for broadband infrastructure deployment.

Episode 4

Snapshot

Nebraska Senate rejects amendment supporting municipal broadband in spending plan

Michigan Governor vetoes bill granting private ISPs property tax exemptions

Montana, Iowa and Maine channel Rescue Plan funds towards new broadband grant initiatives

The State Scene

Nebraska

The Nebraska Senate approved a plan to spend $40 million over the next two years on expanding rural access to high-speed Internet by a unanimous vote on Tuesday, but only after an amendment to L.B. 388 that would have allowed municipalities to offer retail broadband services was rejected.

State Sen. Justin Wayne introduced the amendment, saying that “broadband should be considered a critical infrastructure need and that private telecommunications companies have not stepped up to serve the whole state,” the Lincoln Journal Star reports.

Wayne urged Nebraska Senators “to look to Nebraska's history of public power as a model, as well as to the example of other states that are allowing cities to offer broadband.” The amendment ultimately failed by a vote of 20-24. Wayne assured fellow Senators that he will reintroduce the amendment in the future. 

The bill marked the first time the Nebraska Legislature has suggested using state tax dollars to fund broadband deployment. As it was submitted to Gov. Pete Ricketts for his signature, the bill would annually allocate, until funds run out, $20 million in grants to projects that increase access to high-speed broadband in unserved regions of Nebraska. It would prioritize projects in regions which lack access to Internet service with speeds of at least 25 Megabits per second (Mbps) download/3 Mbps upload. Grant recipients would be required to deploy networks capable of providing service of at least 100/100 Mbps within 18 months. 

Michigan

Snapshot 

Colorado House passes bill that reduces broadband board membership and conceals mapping data

Michigan legislature approves bill granting ISPs property tax exemptions 

New Mexico and Virginia bills await governors’ action 

The State Scene

Tennessee

Tennessee is home to some of the most creative local solutions to bridging the digital divide. Municipal fiber networks across the state, including Chattanooga’s EPB Fiber network, Morristown’s FiberNet, and Bristol’s network, have been a boon to economic development, job creation, educational initiatives, and overall quality of life in the past decade.

The next city to potentially join the ranks of providing municipal broadband in Tennessee is Knoxville. On March 11, the Knoxville Utility Board approved a business plan to provide Internet services across its service area. 

Despite the widespread success of municipal networks across Tennessee, the state restricts what populations they can serve. Although Tennessee law allows cities and towns to offer advanced telecommunications services if they have a municipal electric utility, the networks are not permitted to offer those services to residents who live outside of the utility’s service area. Removing these restrictions would permit substantial fiber expansion to connect more residents at no cost to the state or taxpayers.

When Lincoln, Nebraska, developed their extensive network of conduit back in 2012, they were working within the confines of restrictive state law to encourage better local connectivity. Jump ahead seven years and we find that the city has established a fruitful partnership with private sector partner ALLO Communications. The relationship has brought a long list of benefits to the community, but the latest will help nonprofit sector organizations — Lincoln and ALLO will provide free gigabit Internet access for 10 years to 75 local nonprofits.

The list contains 35 organizations that ALLO has already selected. The remaining 40 will be chosen through a lottery managed by the city’s Community Connect Program. In order to qualify, nonprofits must have fewer than 75 full-time employees, be certified as a 501(c)(3) tax-exempt organization, and have been operating for at least two years. There are other criteria that apply and interested local nonprofits can review the application here [PDF]. In January 2020, the city and ALLO will announce the list of nonprofits to receive the benefit. 

Local Control

The concept of offering the service to local nonprofits was an important element of the partnership between the city and the Internet access provider. Even though Nebraska’s state law prevented Lincoln from offering Internet access directly to the general public, the city recognized the need for fast, affordable, reliable connectivity. When large national providers didn’t provide the types of services businesses and residents needed, they made an investment that would encourage competition.

Lincoln’s conduit infrastructure investment has allowed them to gain a measure of control over connectivity in the community. They considered future needs and varying sectors of the community when they penned the partnership with ALLO, which led to the ability to support local nonprofits.

By extension, nonprofits will be able to divert more of their limited resources to the needs of the Lincoln community.  Cause for Paws, an organization focused on helping local shelter animals hopes to be one of the beneficiaries:

When utilities, including broadband providers, need to cross railroad rights-of-way to serve customers, some railroad operators have been known to press their advantage. Several states have addressed utility complaints by establishing standardized rates and setting up processes to create a more reasonable and predictable system. Eliminating this obstacle to deployment is another step in bringing broadband to the communities that need it the most.

Party Concerns

Often railroads obtained title to real property during 19th century acquisitions as the infrastructure was being built. They want to preserve as much of their authority and title rights as possible and to ensure that they can receive the maximum value for their interest in the land.

For utilities, cost of deployment is a primary concern. When railroads demand unreasonable fees at crossings or drag out negotiations as a delay tactic, they also impinge on a utility’s ability to meet operational deadlines. Safety and engineering integrity can be negatively impacted by difficult negotiations, unreasonable demands, or exorbitant costs.

Different States, Different Stories

Few states have addressed the problem with statutes establishing standard utility fees for railroad right-of-way crossings. David L. Thomas, Managing Member of the strategic utility planning firm Eagle 1 Resources (E1R) has worked with telecommunications companies and other utilities to negotiate railroad crossing arrangements. He's seen that standard crossing fees set down in statute benefit deployment by ending delay and reducing costs and would like to see the trend pass to every state.

Lincoln, Nebraska, home of the University of Nebraska Cornhuskers, will soon boast another fan favorite — a citywide fiber network that will make gigabit speeds available to all residents and businesses.

The City of Lincoln and ALLO Communications, a Nebraska-based Internet service provider (ISP), are approaching the end of the deployment phase of their partnership aimed at building fiber out to every home and business in the city of about 285,000. To expand the fiber network, ALLO has leased access to Lincoln’s extensive conduit system, which hastened the buildout and lowered costs. With only minor construction remaining, all of Lincoln will soon have access to fast, affordable, reliable gigabit connectivity.

In November, ALLO’s President Brad Moline announced that the company would be “substantially done with boring and conduit placement” by the end of 2018. After that step, which is considered the most intrusive of the construction process, ALLO stated that they still needed to connect approximately 3,000 - 4,000 homes to fiber.

City Owned Conduit Leads the Way

Lincoln began its conduit project in earnest in 2012, taking advantage of downtown redevelopment to deploy conduit along public Rights-of-Way. As of 2016, the city had spent approximately $1.2 million building and maintaining the 300-mile-long conduit network.