Stay on Top of Enterprise Technology Trends
Get updates impacting your industry from our GigaOm Research Community
One of the obstacles to more communities getting faster, better broadband is the collection of 20 states with legal restrictions on public-owned broadband networks. In 2015, we should expect to see many of these restrictions aggressively challenged because, frankly, communities are mad and aren’t going to take these impediments to local economic growth any longer.
“Google Fiber, in particular, has inspired some cities to go all in to find a way to get super-fast broadband to their constituents,” Kent Wyatt, founder of Emerging Local Government Leaders, said. “Most local officials, though, haven’t had an opportunity to inform citizens of all their options for broadband and asking voters what they want to do. So why are state legislatures limiting our options preemptively?”
Two organizations have formed to organize and focus efforts by public, private and nonprofit sector stakeholders to find paths to greater broadband coverage. The Coalition for Local Internet Choice (CLIC) unites public and private interests that support local choice and provide communities practical advice and tools to prevent new state barriers from being enacted and remove existing barriers. Next Century Cities is a membership organization providing knowledge and peer support for communities and their elected leaders, including mayors and other officials, as they seek to ensure that all have access to fast, affordable, and reliable internet.
For these groups and other communities to successfully push back on these state laws, everyone needs a good understanding of the various laws and the nature of their restrictions.
Breakdown of public network laws
The 20 state laws restricting public-owned networks can be divided into three categories: the “if-then” laws, the “minefield” laws and the “total ban” laws. Each category presents communities with a different degree of difficulty in pursuing broadband deployments.
The “if-then” laws are fairly straightforward: if you meet requirement X, then your community can build a network. A couple of laws, such as the one in the state of Washington, are pretty simple. Several states such as Iowa and Colorado require communities hold a referendum: if a city gets a certain percentage of the vote, then it can build a network. Pennsylvania communities need to present their broadband wishes to the incumbent for the area. If the incumbent won’t build it, then the community can move forward.
The biggest barrier in the “if-then” states, though, appears to be one of perception. Compared to other states’ laws, “the law in Pennsylvania is one that’s straightforward to work through,” said Beth McConnell, policy director at the Philadelphia Association of Community Development Corporations. “Unfortunately, many communities honestly believe that the state has a complete prohibition of any kind of public-owned networks.” One county here (Cambria) navigated the waters and built a network. But despite its success, only two Pennsylvania communities appear to be interested in following its lead.
Several years ago, many communities feared a referendum as a near-impossible mountain to climb because the incumbents could crush them in an electoral battle. However, first Longmont, Colorado, and then 10 more cities in the state plus a couple in Iowa, passed ballot measures in the last two years, creating a roadmap for winning referenda.
Meeting the requirements of many of the If-Then Laws actually contributes to the success of a community broadband network.
These state laws were written with the primary intent of prohibiting public-owned networks, but without coming right out and stating it. They create multiple layers of rules that are so onerous as to make compliance a significant financial burden, or they are worded so vaguely that they become minefields in which one wrong step could trigger incumbents to take legal action. North Carolina and Louisiana are two states with this type of law. Wilson, North Carolina is one of two cities petitioning the FCC to have its state laws rescinded.
Small and rural communities in these states are particularly disadvantaged because they don’t have the legal resources and experience to go battle giant incumbents’ legal teams. Mid-size cities such as Lafayette have greater resources and overcame their legal challenges. But most would prefer to avoid the addition to costs and time delays while legal battle rage toward uncertain conclusions.
In general, these laws have so many levels of restrictions and requirements that the best (though not only) ways for cities to move forward is to get legislators to reverse all or parts of the laws, or for the FCC to use its authority to rescind the laws.
“Total ban” laws
These laws typically are short and unambiguous — public entities are prohibited from providing services, or they can provide services to a limited audience and only on a wholesale basis. However, there may be a loophole in a couple of states that can be exploited.
It may surprise a lot of people that Texas is not part of the list at all, particularly since it has a law that says public entities cannot own or operate telecommunications services. However, Texas telecom attorney Clarence West pointed out in a filing with the FCC that “Texas cities are not prohibited from providing Internet connectivity, as it is a federally classified as an ‘information service, not a ‘telecommunications service.’ There are Texas cities that have provided internet connectivity on a city-wide basis and Greenville, Texas currently provides both cable and Internet access service.”
This brings up an interesting discussion point. Why don’t public entities just do as Texas does and ignore those statues that only prohibit or restrict telecommunication services? For now, let it suffice to say that this battle has to play out in each state on its own. The complexity of these laws must be studied in depth, and the politics of each state is a big factor on how to approach these laws.
In my next post, I’ll explore some potential ways forward in addressing these restrictions.
This is a list of which states fall in which category.
|If-then laws||Minefield laws||Total bans|