State laws and regulations prevent municipalities from collaborating with Internet Service Providers in public-private partnerships that could bridge the urban-rural digital divide, the N.C. League of Municipalities says.
A group of municipal officials held a press conference Wednesday, March 21, with state Rep. John Szoka, R-Cumberland, to unveil a new report titled Leaping the Digital Divide: Encouraging Policies and Partnerships to Improve Broadband Access Across North Carolina.
“We believe this report contains concrete proposals that can help close the gap in broadband access both in rural communities that still lack basic connections, and in the many areas of the state that do not have optimal Internet service, and speeds that are required for businesses to thrive,” said Jacksonville Mayor Pro Tem Michael Lazzara, League of Municipalities president.
But an expert who acknowledges an urban-rural gap between the quality of available online services says government investment often funds technologies that are outdated by the time they become functional. Removing regulations and enabling private investment, in his view, could close that gap faster and cheaper than creating hybrid government/private entities.
Szoka urged legislative colleagues to use the report’s recommendations as guidance for action.
Among other things, the League’s report cites three potential public-private partnership models with varying levels of local government involvement, financial risk, and control. The goal is to connect 637,671 North Carolina residents identified by the Federal Communications Commission as lacking high-speed internet to a broadband service.
Among those, 95 percent of them, or 607,431, live in rural areas. Officials with the league say the FCC’s estimate of the number of underserved North Carolinians is too low.
In a telephone interview, David Williams, president of the Washington, D.C.-based Taxpayers Protection Alliance, agreed with the authors that connecting rural, isolated, and underserved areas to fast broadband Internet access is vital. But he firmly opposes public-private partnerships, favoring greater free market solutions.
“They just take way too long to build,” Williams said of public-private systems. “They’re way too expensive. They’re over budget. They’re behind schedule, and taxpayers are left on the hook for this for nothing. At the end of the day there’s nothing to show for it except a failed system and the waste of dollars.”
Szoka, a primary sponsor of House Bill 68, the BRIGHT Futures Act, was joined at the press conference by Rep. Kevin Corbin, R-Macon, who co-sponsored the measure.
“The purpose of that bill was to help people in rural and low-income areas connect to the economic development opportunities arising in the fastest-growing, emerging markets of the 21st century,” Szoka said. The measure passed the House 109-8. It is in the Senate Committee on Rules and Operations.
Szoka said the Senate needs to act on his bill in the upcoming short session. He believes senators could use the report’s recommendations to further strengthen H.B. 68.
“It’s absolutely necessary that we have to take the actions required to connect to every last house on the last dirt road, from the mountains to the sea, in this state to afford our citizens the opportunity to fully participate in the global economy,” Szoka said. “Without that we’re not fulfilling our obligations as elected servants, and without that our children are just going to fall further and further behind.”
He said the urban-rural divide wouldn’t be solved by throwing money at problems, or viewing industrial recruitment to rural areas as a silver bullet.
“The answer in today’s day and age is to get the whole state connected to high-speed broadband. Without that we lose a really valuable tool in luring companies to rural areas,” Szoka said.
“Public partners are very adept at building infrastructure,” said Erin Wynia, League of Municipalities general counsel. The report, which she co-authored, casts broadband as a modern equivalent to legacy government infrastructure such as roads, water and sewer service, electricity and natural gas.
Different types of technology are possible, along with differing ways government could help connect unserved areas, she said. They include fiber strands, the poles that the fibers run between, plastic conduit pipes buried underground, or antennas and electronics that light up fibers carrying data from one point to another.
But before local governments can engage in public-private partnerships they need legislation to raise money through taxes and bonds, to spend money on broadband infrastructure, and to lease infrastructure to private and nonprofit entities that would operate and profit from use of the infrastructure.
Williams counters that broadband isn’t a true infrastructure. Local governments characterize it as a utility, though, to open a floodgate of subsidies.
“We have found these systems to be awful, and have failed miserably across the country at the waste of billions of taxpayers’ dollars,” he said. He cited KentuckyWired as an example of a failed public-private partnership. It is supposed to wire all Kentucky counties with 3,400 miles of cable. In two years it has completed only about 60 miles.
The private company in a Utah public-private partnership wanted the government to impose a $20 fee on everyone’s electric utility bills to recoup its investment, even if the utility customer wasn’t using the broadband service, Williams said. A Wyoming partnership said it would break even in about 1,200 years.
Government involvement should be restricted to things such as temporary tax breaks for equipment purchases, or rescinding regulations that impede broadband access, Williams said.
The private sector has invested trillions of dollars into development and deployment of internet technology over the past 20 years, and is better suited to building out its networks than government is, Williams said.
He said government involvement doesn’t keep pace with emerging technologies. Taxpayers might foot a bill over decades for technology that becomes obsolete long before then.
Indeed, he noted, on the FCC meeting agenda for Thursday, March 22, is consideration of removing regulations on 5G internet, an emerging technology that’s faster, less expensive, and easier to install.
“I think that a lot of these issues may actually be solved by what the FCC is doing, by selling the [broadband] spectrum, by reconfiguring the spectrum for 5G,” Williams said. “I think what we’re seeing at the federal level could bear fruit very quickly, and I’m talking about within a couple of years, to address this digital divide.”