With an unprecedented amount of federal funds to build broadband networks flowing into individual states, lawmakers in some states are doing the bidding of the big monopoly Internet Service Providers and potentially blowing a once-in-a-generation chance to invest in the locally-accountable infrastructure that offers the best chance to bridge the broadband gap for millions of families once and for all.  

Two weeks ago we wrote about the anti-competition broadband legislation making its way through the State Legislatures in Illinois and New York as state lawmakers across the nation establish high-speed Internet grant programs.

That trend looks like it’s continuing in Michigan where Democratic Gov. Gretchen Whitmer and the state’s GOP-dominated Legislature recently reached a deal to pass a nearly $5 billion spending bill.

While the “Building Michigan Together Plan” is being “celebrated” by the governor’s office as a way to “grow the economy, create jobs, and benefit families in every region of the state,” the main supplemental spending bill, known as Senate Bill 565 (SB 565), may sink some hope community broadband advocates have for leveraging the windfall of federal funds the Great Lakes State is getting from the American Rescue Plan Act (ARPA) and the forthcoming funds in the Infrastructure Investment & Jobs Act (IIJA).

Protecting Incumbents from Competition

Now that the fight over federal funding to expand broadband access has been largely settled with the passage of the American Rescue Plan Act (ARPA) and the Infrastructure Investment and Jobs Act (IIJA), states and local communities are preparing to put those funds to work.

The Biden Administration had initially hoped to tip the scales in favor of building publicly-owned broadband networks as the best way to boost local (more affordable) Internet choice, and inject competition into a market dominated by monopoly incumbents. And while the Treasury rules on how Rescue Plan money can be spent does give states and local governments the ability to do just that, the rules for how the IIJA’s Broadband Equity, Access, and Deployment (BEAD) program can be spent have yet to be finalized by the National Telecommunications and Information Administration (NTIA), the agency in charge of allocating those funds to the states.

Predictably, the big monopoly incumbents are focusing their lobbying efforts on state lawmakers as states funnel those federal funds into state broadband grant programs. In some states, Big Telco is getting the desired result: the shunning of publicly-owned network proposals to shield monopoly providers from competition. Of course, we expected some states – especially those with preemption laws that either erect barriers to municipal broadband or outright ban such networks – to shovel most of their federal broadband funds to the big incumbents, even though they have a long track record of over-promising and under-delivering. 

But while we might expect Florida and Texas to favor the private sector and stealthily move to shut out projects that are publicly-owned, we’re surprised that the first place it’s happening is actually Illinois and New York.

Illinois Lawmakers Thumb Nose at Federal Law

Located in southeastern Iowa, Dubuque (pop. 60,000) has considered the advantages of building a municipal network a number of times over the past fifteen years. Back in 2005, the city – as well as several other Iowa communities – voted to “grant the right to create municipal systems” (Telegraph Herald, 2009). The new legislation, however, did not result in many new telecommunications utilities. 

The road to better connectivity has been a long one, marked by repeated battles between locals served by poor or no service and the city’s incumbent providers. In 2009, Mediacom used the state’s right of first refusal law to keep competition out of its territory, causing the city to “cry foul” and Dubuque to reconsider a public network. In 2015, the city of Dubuque and the Greater Dubuque Development Corporation joined forces to expand local connectivity in response to community demand. The partnership included convening private and public sectors to identify last mile infrastructure and foster collaboration, and supporting opportunities for expanded connectivity. By 2017, private providers including Wisconsin Independent Network, CS Technologies, Unite Private Networks, CenturyLink, and Mediacom had made efforts to serve some of the unserved areas, but pockets of the community were still left out. 

Only more recently has a formal proposal been set forth, with the potential to create a robust middle-mile network designed to dramatically improve competition and incent private ISPs to invest in the un- and underserved pockets of the community. 

A Formal Proposal for Public Broadband Infrastructure 

Like numerous U.S. counties, large segments of Kandiyohi County, Minnesota (pop. 44,000) lack access to affordable Internet service at modern speeds. So like many underserved communities, the county—situated about ninety miles west of Minneapolis—is looking to take advantage of a once-in-a-lifetime collision of funding opportunities to help finance a massive fiber broadband expansion across numerous county townships. 

A recent survey by the county unsurprisingly reveals that residents are greatly annoyed by the lack of affordable Internet access options, with 64 percent of locals saying they’re dissatisfied with the Internet service provided by regional monopolies.

Ten Projects on Tap

Hoping to address the shortcoming, Kandiyohi County and the City of Willmar Economic Development Commission have been working on ten different projects to shore up Internet access around the county. 

Some of the proposed projects involve partnerships with national monopoly providers like Charter Communications, but others will involve the county and a local cooperative doing the heavy lifting. The county had hoped to fund the projects with a combination of subscriber fees, American Rescue Plan funds, NTIA grants, and upcoming Minnesota state grants.

The first major project closest to being “shovel ready” is a $10 million fiber-to-the-home (FTTH) project in partnership with the Federated Telephone Cooperative of Morris. Federated is expected to finance twenty-five percent of the overall project, with new subscribers expected to pay about $1,250 per household to connect to the gigabit-capable network. 

Welcome to In Our View. From time to time, we use this space to explore new ideas and share our thoughts on recent events playing out across the digital landscape, as well as take the opportunity to draw attention to important but neglected broadband-related issues.

As federal funds to expand high-speed Internet access began to flow to states and local communities through the American Rescue Plan Act, and with billions more coming under the Infrastructure Investment and Jobs Act, Big Telecom is beginning to mount its expected opposition campaign designed to discourage federal (and state) decision-makers from prioritizing the building of publicly-owned networks.

Predictably, a centerpiece of this anti-municipal broadband campaign is the trotting out of well-worn - and thoroughly debunked - talking points, arguing that federal funding rules should not “encourage states to favor entities like non-profits and municipalities when choosing grant winners” because of their “well-documented propensity to fail at building and maintaining complex networks over time.” That’s what USTelecom, a trade organization representing big private Internet Service Providers (including the monopolies) wrote in a memo sent last week to President Biden, the FCC, cabinet secretaries, House and Senate members, Tribal leaders, as well as state broadband offices. 

Fairfield City, California is one of several cities in the state hoping to lean on both California’s broadband expansion initiative and the American Rescue Plan Act to provide faster, less expensive Internet access for city residents. The city says it will soon exit the research phase of its project and outline what they believe is the best path forward.

Last May the city council approved a plan to deploy a city-owned broadband network to expand broadband options in the city using Rescue Plan funds. Last August, the city launched a Broadband Action Planning (BAP) process to measure the scope of Internet access gaps and propose a solution, the results of which will soon be shared with the city council and the public.

Digital Divide Exacerbated

Like so many U.S. communities, the lack of affordable, equitable Internet access was particularly pronounced during the Covid crisis, the city said. 

“Access to broadband is becoming a prerequisite for improving economic and social welfare,” Fairfield City Communications Manager, Bill Way, told ILSR. “It provides a conduit to enable open and accessible government, enhance business competitiveness, and improve the quality of residents’ lives through improved delivery of services such as telework, telehealth, distance learning, and digital inclusion.”

The city recently completed a survey of community members, and the majority of the almost 300 responses cited limited competition and a lack of affordable Internet access options. 

“While a few comments were positive, most comments indicated lack of options, low speeds, and high costs,” Way said. “One specific consideration to note, although city staff coordinated with outside agencies to cast a broad reach for the survey, and utilized in-house engagement efforts, the responses did not generally capture vulnerable populations, most at-risk of being digitally excluded.”

Known for decades as the "Sweet Onion Capital of the World," tourists are still drawn to the rural farmlands of Toombs County in east central Georgia for the annual Vidalia Onion Festival.

But in early November 2021, officials from the member-owned electric cooperative Altamaha Electric Membership Corporation (EMC), flanked by an assortment of state and local officials, gathered at the sprawling L.G. Herndon Farms to announce the cultivation of a new venture. Through its newly created subsidiary Altamaha Fiber, the 86-year-old cooperative recently started construction of a fiber-to-the-home network to serve its 14,000 members who live in Toombs County and in the six neighboring counties (Emanuel, Johnson, Laurens, Montgomery, Tattnall, and Treutlen).

A 5,000-acre spread where they grow Vidalia onions, greens, soybeans, and corn (with over 1,600 cattle and a trucking company on the property), L.G. Herndon Farms was chosen as the site to make the announcement because the farm also happened to be the first business test customer for Altamaha Fiber.

Fiber-to-this-farm will allow for precision agriculture. And, as reported by The Advance, Phil Proctor, the engineer overseeing network construction, noted an added benefit, especially in an area that prizes college football in the ACC: “The lines coming into this building would allow owner Bo Herndon to live stream the Georgia Tech vs. Virginia Tech football game in vivid 4k resolution.”

Beyond the Herndon farm, Georgia Public Service Commissioner Jason Shaw spoke of the far ranging benefits of broadband for the region:

Sworn in earlier this month as president of the newly created Maine Connectivity Authority (MCA), Andrew Butcher says he is ready “to hit the ground running,” shepherding Maine’s efforts to bring universal access to high-speed Internet service in one of the most rural states in the nation.

The MCA, first proposed last year by Gov. Janet Mills and created through bipartisan legislation, will oversee the influx of federal funds the state has received from the American Rescue Plan Act and funds the state will get from the recently passed Infrastructure and Investment Jobs Act.

The quasi-governmental agency will remain distinct from (but coordinate with) the ConnectMaine Authority, which administers the state’s broadband grant programs.

In a statement released after Butcher was sworn-in, Gov. Mills said:

I am grateful for the Senate’s unanimous confirmation, which is a testament to their confidence in Andrew’s experience and expertise to lead the Maine Connectivity Authority. With Andrew at the helm, and with the Authority’s Board fully in place, it is time to build on our work to expand access to affordable broadband. Broadband is no longer a luxury; it is a necessity for every person, every family, and every business across Maine, and with today’s vote, we are taking another step forward in our effort to make universal broadband a reality for Maine people.

For his part, Butcher said he was “humbled by (the) unanimous confirmation of the Senate and am honored for the opportunity to serve Maine as we look to build the infrastructure of the future. We can get there from here. Many have forged the path to get here and I'm eager to get to work connecting everyone.”

Getting ‘there from here’

Hoping to leverage both a major new California broadband expansion initiative and American Rescue Plan (ARP) funds, Chico, California is moving forward with its plan to deliver affordable fiber broadband to historically-underserved city residents. 

The Chico city council last year began exploring using $4.8 million of the city’s $22 million in American Rescue Plan (ARP) funds to build a citywide fiber network. After spending $250,000 to research its options, the city council voted last week to move forward with the plan.

Dual Purposes

City leaders hope the network will provide more reliable connectivity for the first responders battling historic wildfires in the region. But like many communities, Chico was also spurred to action by telecom market failure, a lack of competition among regional monopolies, and the slow speeds, spotty coverage, and high prices that routinely result. 

“All of us have had experience with the existing incumbents and what we pay for versus what we get,” said Chico's Information Systems Manager Josh Marquis. “There's a lot of areas of our region that do not have access either through affordability gaps or through service gaps.”

Much like Fort Pierce, Florida, Chico will begin by running a pilot project first targeting lower income parts of the city like the Chapman Mulberry neighborhood. There, residents will be provided inexpensive access to symmetrical fiber either through the city or a partner, made cheaper still once the FCC’s Emergency Broadband Benefit (EBB) discounts are applied. 

It can be difficult to track all of the federal funding opportunities out there these days for communities looking to improve local Internet access. Even more difficult is parsing through all the ways they can be used, and charting a path to successfully weave them together to achieve local broadband goals. To help, we published our "Community Guide to Federal Funding Opportunities" in September, followed up by a look at what the recently passed Infrastructure Investment and Jobs Act (IIJA). 

But Common Sense Media recently put out a Federal Broadband Funding Guide packed with useful information and well worth bookmarking for future use. It breaks down the buckets of broadband money not only in the IIJA, but from the American Rescue Plan, the Consolidated Appropriations Act of 2021, and the other ongoing programs like USDA ReConnect. 

The value of the guide comes from Common Sense including clear and concise descriptions of the legislation, the amount of money allocated in them, who the funds will be flowing to and in what ways, what the deadline is to use the funds, and if they can be dedicated to infrastructure, devices, affordability, or equity and inclusion projects. Check it out here, or download below.