Wilson Largely Exempted, but NC Takes a Big Step Backward

NC Legislative BuildingAfter four years of heavy lobbying, the cable company is probably getting what it wants. New municipal broadband NC probably won’t be developed if H129 clears the final hurdle at the Governor’s office. She has the option to veto, but no one knows what will happen.

More on that in a second, but there is a bit of important news for people in Wilson. Greenlight has been largely exempted from the bill’s effects. If you’re one of our 5,700+ members or you live in Wilson County, you don’t have to worry about service. Greenlight is here to stay.

If you live outside Wilson, the news isn’t so good. We have the fastest broadband in the Raleigh/Durham region, but we’ll have to keep it in Wilson. The bill dictates that people outside Wilson County can never hook up to our fiber. We’ve had requests to extend to Raleigh, but this bill ensured that our friends there will be stuck with you-know-who.

For those of you outside of Wilson, let me tell you what you’re missing.

  • Greenlight’s minimum residential broadband speeds are 10Mbps up and down
  • Our all fiber network is maintained by local crews 24/7
  • Our Police are using the network for security cameras in public places
  • Our Firefighters are using the fiber network for remote training
  • Input from our members has helped determine our video channel lineup
  • The costs are reasonable, and have forced even Time Warner Cable to lower its rates to its Wilson customers.

We’re glad to see Wilson exempted, but our state has allowed an outside company to place limits on it. Representative Bill Faison (D-Chatham) said it best in an interview with WUNC News:

“This bill should be retitled the Time Warner cable anti-competitive bill, it’s a New York company bill, it’s not even folks from around here’s bill, to keep our municipalities from providing services to their citizens. “

One more thing: thank you to all of you who have helped our state in this fight. We were surprised and encouraged by how many of you called a lawmaker or spoke up on NC’s behalf. Thank you so much.

Municipal Broadband Untouched. Session is Over. Thank you!

NC House Chamber

NC House Chamber- Courtesy NC General Assembly

Thanks to you and your participation in the process, lawmakers saw that protecting decades-old monopolies isn’t the slam dunk the cable company had made it out to be. The NC General Assembly wrapped up the year early Sunday morning without taking action on municipal broadband. This year was the biggest battle friends of community broadband had faced. Bottom line, municipal broadband, including Wilson’s Greenlight, will continue to improve NC broadband speeds and provide critical infrastructure for our citizens. Thank you!

Here’s a note from Catharine Rice of SEATOA who stayed up all night Saturday to watch S1209 wrap up. This may sound like a lot of government-speak, but roughly transalated, there was a lot of zigging and zagging on broadband right up until the end.

From Catharine:

Saturday morning, July 11, at 5 a.m., the NC House of Representatives killed Senator Hoyle’s (D-Gaston) attempt  to force a moratorium on municipalities seeking to provide their communities broadband service. This was the industry’s 3rd (actually 4th) attempt to stop municipalities from providing superior bbnd infrastructure to the communities.

The bill died on Saturday after a one-two punch. First, the House Ways & Means Committee had refused to hear S1209 since June 8, under the hands of Committee Chair-Rep. Faison (D-Orange, Caswell), when it crossed from the Senate to the House. Then late Friday evening, the House itself added an amendment to its Study Authorization Bill (SB900) permitting, but not requiring, the Revenue Laws Study Committee to study the laws and circumstances surrounding municipalities providing broadband service to their communities, but dropping all other terms of S1209, mainly  the moratorium. The Senate concurred with House bill 900 unanimously later in the evening (9:49pm) and it was enrolled for review and signature by the Governor. (See Sections 7.5 (a) and (b) here)

Ten minutes later, Sen. Clodfelter introduced H455, a bill whose effect would have changed the approach of the House’s version of the municipal bbnd study. With H455, Senator Clodfelter gutted a House kidney awareness bill, and poured into it the “study” portion of S1209 (Hoyle’s Anti-Muni broadband bill), changing the House version by setting a date certain when the study (and recommended legislation) would have to be completed (March 2011), and increasing the number of seats on the subcommittee from 12 to 14, adding assigned seats for telephone coops and the NC County. The House version did not mandate a study, but made it optional, did not specifically authorize the committee to recommend legislation, and set the seats for the subcommittee at 12, naming 8 with an additional four unassigned seats. Clodfelter’s H455 contained two other sections, one addressing a fluke in sales tax refunds for MI-Connection, the Mooresville-Davidson muni bbnd system.

Around 2:45 Saturday morning, on Rep. Paul Luebke’s (D-Durham) motion, the House denied concurrence with the Senate on H455 (96 to deny, 1 to allow). At 3:45 a.m., the House approved a Senate/House conference committee report for the purpose of keeping only one section of H455, (effectively deleting H455’s changes to the House study version of S1209). H455 (here) now provides a state sales tax refund status for Davidson and Mooresville’s MI-CONNECTION system, status the two towns would have if individually providing cable service, but from which they were disqualified by having  joined together to provide broadband cable  service.  On a vote of 91 to 6, the House approved the Senate/House conference report. At 4:55 a.m. the Senate concurred with that report and it was enrolled for the Governor’s attention.

Dismal speeds from most providers still the norm in the US

Yahoo! News has a good story today about Internet access speeds, and the news is no surprise. In spite of millions of dollars of slick advertising and cartoon characters, we’re still slow in this country. This line sums it up best. “When it comes to Internet performance, in the aggregate, none of us are exactly living it up. The fastest throughput in America clocks in, on average, at a measly 1.22Mbps.”

These figures include the cable giants who are charging you big bucks for “blazing” speeds and such.

Greenlight’s slowest residential speed is 10Mbps upload and download. Why is Greenlight different? The network is all fiber optics, plus we serve a smaller area. Most of the cable companies, including the one with the most customers in NC, rely on old copper lines that simply can’t carry the same speeds as fiber optic networks. PC Mag recently said, “Those results are clear: fiber-to-the-home is the way to go nationwide…”

Wilson invested in its own network, and other NC cities and towns deserve the same chance. If they’re forced to wait on the outdated cable and telecom companies, the US will continue to lag behind other developed countries.

Paper: Muni Broadband Bill Quietly Tucked Into Another Bill

Okay, I know there’s a lot to keep up with in this ongoing battle, but there’s a new development you need to know about. According to the Greensboro News and Record’s Mark Binker, the municipal broadband moratorium from senate bill 1209 has been moved to another bill, house bill 1840; apparently to get around a committee that the sponsor, Sen. David Hoyle (D-Gaston), considered unfriendly.

Here’s today’s story, courtesy of the News and Record:

Muni broadband moratorium put in another bill

For those watching the municipal broadband moratorium bill (background from me here and from the N+O here) you have another bill to keep track of.

The Senate Rules Committee attached the broadband study and moratorium as constructed in S 1209 and dumped it into H 1840, which has to do with extending E-NC authority.

I asked Sen. David Hoyle, chairman of the Rules Committee, why he was sending over a bill that has already passed the Senate.

“I’m sending it over with something the House likes,” Hoyle said. “I can’t get a committee hearing on the broadband.”

Rep. Bill Faison, the House committee chairman holding onto the bill, attended Senate Rules to watch the proceedings but did not comment to the committee.

This is the legislative version of trading paint. If the House fails to concur on H 1840, the measure will be sent to a conference committee. At that point, if no senator signs off on a conference report, the bill goes nowhere. So Hoyle can say, give me a hearing on the muni broadband bill or I lock up you E-NC bill.

“All I’m asking for is a hearing, an up or down vote,” he said. “It’s not fair for someone just to hold my bill and not hear it.”

That collective coffee spit you just heard was Senate Republicans thinking to themselves about all the bills they can’t get heard in their own chamber.

Clarifications to News and Observer Article About NC Broadband Bill

The News and Observer published an article this week about the broadband fight in NC. While the reporter did his best to cover a big issue in a relatively small amount of space, some important points were left out.

First, you should know two things:

  • Before building our fiber optic network, Wilson asked the cable company to upgrade its network or to partner with us to build something better. They turned us down.
  • Broadband from the City of Wilson is much, much faster than cable modems. Local homes can get up to 100 Mbps upload and download.

The article is below in its entirety. My comments and clarifications are in blue italics. The copy is owned and copyrighted by the News and Observer of Raleigh. Now, on to the article…

Cable TV fights municipal broadband

BY JOHN MURAWSKI – Staff Writer

Alarmed by the prospect of competing for customers against local governments, the cable TV industry is pushing for a state law to prevent North Carolina cities from offering Internet and cable systems to their residents.

The industry, led by Time Warner Cable, wants to protect itself from what it calls unfair competition. The industry’s concerns are gaining urgency as some two dozen towns in the state are either planning or exploring their own telecommunications and television service for residents and businesses.

A proposed moratorium on municipal broadband has sailed through the state Senate and is now awaiting debate in the House of Representatives. But some lawmakers in the House are intent on derailing any proposal that would delay the development of local broadband networks. They say the future of the state depends on unfettered broadband access.

The bill is pending in the House Ways and Means Committee, whose chairman, Rep. Bill Faison, sees the moratorium as an attempt to protect the powerful cable monopoly. Faison, a Democrat who represents Orange and Caswell counties, is meeting Wednesday with representatives of the telecommunications industry and local government leaders to discuss options.

“I decide what gets put on the agenda,” Faison said. “It’s unlikely that any bill with a moratorium in it has a chance of getting through the House.”

Local growth

Virtually unheard of just a few years ago, a high-speed Internet and cable TV service offered by your local government is becoming a reality for some.

The City of Wilson’s $28 million Greenlight service is the prototype of municipal broadband in this state, launched just two years ago and now claiming about 4,800 customers. The City of Salisbury will be next with its $30 million Fibrant service, scheduled to be offered later this year. Meanwhile, Fayetteville is set to study its own version of municipal broadband this summer and could decide this year whether to proceed.

Additionally, the towns of Davidson and Mooresville recently bought telecom assets from Adelphia Communications during bankruptcy proceedings, and now both provide municipal broadband. Their jointly owned system has been hobbled by revenue shortfalls as the towns seek to convince more citizens to subscribe.

City officials say municipal telecom service is an economic development strategy that will increase competition and provide high-speed Internet access to those who lack any kind of broadband. They point out that local governments traditionally provide public services – water, sewer, electric, natural gas, transportation – where the options are nonexistent or inadequate.

“We’re running this as a public utility,” said Doug Paris, assistant to the city manager in Salisbury. “It’s really not a luxury anymore – it’s a necessity.”

Potential dangers

Opponents warn that towns run a major risk of defaulting when competing against Wall Street-backed industries. In addition to contending against Time Warner Cable, the state’s dominant cable provider with 1.7 million customers, government broadband networks would also have to compete against satellite services, AT&T’s U-verse where it’s offered, and the expected spread of Internet-streaming services.

Sen. David Hoyle, a Democrat from Gaston County, says he heard similar arguments from government officials decades ago when city halls were eager to get in on the business of selling electricity. Several dozen North Carolina towns, including Wilson, joined to buy a share in utility-owned power plants, and now their residents pay some of the highest power bills in the state.

Wilson is one of 32 cities in the NC Eastern Municipal Power Agency (NCEMPA) and yes, our residential electrical costs are higher now, but they are temporary. We are paying down debt from the early 80s after the 32 cities and towns helped CP&L (now Progress Energy) finish construction at Shearron Harris Nuclear Power Plant. We passed the peak of that debt a few years ago. Our internal costs are actually less than the state average.

A similar proposal last year was also deferred for study by the General Assembly’s Joint Revenue Laws Committee, which led to the bill proposed by Hoyle this year.

Hoyle originally proposed restricting municipal broadband by requiring a public vote on a general obligation bond issue before a town could invest in a broadband network. Hoyle said such a vote would essentially prevent the systems from being built once citizens see the costs involved.

But the Senate preferred a year-long moratorium so the matter could be further studied by a panel to be named by the Joint Revenue Laws Committee. If municipal broadband expands, Hoyle worries that it’s just a matter of time until local towns are asking the state for bailouts.

“They’re going to have debt up the ying-yang,” Hoyle said. “It’s people getting into business they don’t know anything in the world about.”

(Okay, a freebie here. We all trust local government to put out house fires, arrest bad guys and provide our drinking water. Providing better communications services is relatively simple.)

Faison’s concern is promoting universal broadband access. It’s estimated about 10 percent of the state’s population, mostly in rural and remote areas, lacks access to high-speed Internet. Still, the networks being developed by local governments largely overlap with existing networks.

While the networks overlap, the services don’t. Wilson provides much faster broadband speeds than the cable company – up to 100 M residential. It’s apples and oranges.

The argument

About half the nation’s states restrict municipal broadband. The N.C. Cable Telecommunications Association says local governments have an unfair advantage over Time Warner or other providers because they don’t pay taxes and consequently have significantly lower operating costs.

Other conflicts can arise as well. For example, in 2007, when Wilson was developing its Greenlight service, the town tripled its rate for using municipal utility poles from $5 to $15 a year. That raised the pole fee for Time Warner Cable from $82,000 to $246,000 a year, but Time Warner is still paying the old rate while it negotiates with town officials over the issue.

Before 2007, Wilson’s pole fee had stayed the same since 1975. The attachment fee increase was not related to Greenlight. The old fee schedule was outdated. By comparison, the cable company’s standard rates have doubled since 1997.

“When the regulator becomes your competitor, it’s not a good situation,” said Marcus Trathen, a lawyer for the cable lobby.

Wilson and other cities regulate only the pole attachments. The cable and telecom companies are regulated by the State of NC. The local regulation of cable services ended in 2007 after intense lobbying from the cable/telecom companies.

The moratorium provision before Faison’s committee is the result of a compromise between the N.C. League of Municipalities, the city government’s lobby, and the N.C. Cable Telecommunications Association, the industry’s lobbying arm. The moratorium doesn’t apply to towns that are already planning or developing municipal broadband, towns that received federal stimulus grants for broadband deployment, or towns chosen by Google for its Fiber Project.

Restrictions on municipal broadband also are opposed by Google, Intel, Alcatel-Lucent and several other telecom companies that wrote a letter to lawmakers in May.

“North Carolina should be lowering barriers to public broadband initiatives rather than establishing new ones,” their letter says, arguing that the state would be cutting off potential federal stimulus grants.

Both sides accuse the other of putting profits before the public interest.

“It’s like, say, Barnes & Noble saying we shouldn’t have a public library system because it stops private sector investment,” said Kelli Kukura, the League’s director of governmental affairs. “The bottom line is they need to get busy working on this or get out of the way so we can serve our citizens.”

S1209 exempts Wilson; goes to the full Senate today

Sen. David Hoyle (D-Gaston)

Sen. David Hoyle (D-Gaston)

The Senate Finance Committee made some pretty big changes to Senate Bill 1209 yesterday. It is being heard in the Senate today. You can listen to the discussion here. Just click on Senate Chamber.

Wilson was fully exempt from the bill. That means the 28-million dollar investment our community made three years ago wasn’t made in vain. Our broadband network continues to sign new customers. We’re rapidly approaching 5,000 households; pretty good for less than two years of availability.

While I’m glad that Wilson was exempt, the bill still pits NC against the national trend of improving broadband service. As one lawmaker noted yesterday, the private companies simply aren’t moving fast enough, or at all in some cases, to make broadband available to rural communities.

Senator Hoyle, the sponsor of the bill, told the committee that both the cities and the cable/telecom companies dislike the bill, so it must be good.

S1209 in Finance Committee Tuesday, plus a surprise from Rep. Faison

Rep. Bill Faison

Rep. Bill Faison

Been a busy couple of days on the issue of next-generation broadband in our state.

First, unless they change the date again, Senate Bill 1209 should come up in the Senate Finance Committee this Tuesday, June 1st, at 1pm in the Legislative office building; room 544.

Yes, it’s scheduled for the first day back after a three-day weekend. :)

Now stick with me, here. This gets a little complicated, but it’s good news.

Rep. Bill Faison (D-Caswell, Orange) has introduced a second bill, House Bill 2067,  that would specifically allow Caswell County to build its own broadband network.

Mr. Faison’s bill lists broadband as a public utility, and that’s important. Some lawmakers, including the cable and telecom companies, have portrayed broadband as a luxury. The Independent Weekly of Durham covered the story.

More as this develops. I hope to see you Tuesday.

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