Proposed bill to outlaw community broadband service in Kansas met with opposition
02/26/2014 7:23 PM
08/08/2014 10:21 AM
A bill to outlaw community broadband service across the state will come before a Kansas Senate committee Tuesday.
Senate Bill 304, introduced by a lobbyist for the cable TV industry, would prohibit cities and counties from building public broadband networks and providing Internet service to their businesses and citizens.
Officials in the southeast Kansas city of Chanute, population 9,100, say they’re the primary target of the proposed legislation. As part of its public utility system, the city runs an ultra-high-speed broadband network that now serves schools, city buildings, the town hospital, banks and other key businesses.
On Nov. 23, the City Commission voted to work toward “fiber to home,” which would extend access to all residents and businesses within about a three-mile radius around the city, said Larry Gates, Chanute utilities director.
“This bill (SB 304) is an attack on competition, an attack on municipal government,” Gates said. “It takes away our local control and local decision making. It will hurt our efforts in economic development.”
John Federico, a cable industry lobbyist who introduced the bill, was out of the office and could not be reached for comment Friday.
Sen. Julia Lynn, R-Olathe and chairwoman of the Commerce Committee where the bill will be heard, said the main argument in favor of it is philosophical – the concern of government competing with private enterprise for broadband customers.
Lynn said she doesn’t think that’s a fair competition because “They (municipalities) don’t have to pay property taxes, and they don’t have to pay franchise taxes.”
Lynn said she doesn’t oppose government stepping in when private-sector broadband service is nonexistent or substandard.
“It ought to be up to the town to decide if they want the local city hall to take care of it,” she said. However, she added, “I think that would only happen in very rare instances where there’s no service.”
As written, the bill contains an exemption for “unserved” communities. However, there’s nowhere in Kansas that would actually be unserved under the bill’s definition.
According to the bill, an area is deemed served if nine out of 10 residents can get satellite Internet. Beamed from space, satellite service is available anywhere in the 48 contiguous United States that has a view of the southern sky. Satellite is generally slower and considerably more expensive than cable or telephone broadband.
“I think it (SB 304) is bad for our local rural communities,” said Sen. Tom Holland, D-Baldwin City, the ranking minority member of the Commerce Committee.
He said several small towns in his district are considering setting up their own networks or partnering with smaller providers because “they’ve had a heck of a time trying to provide high-speed Internet to their constituents. This (bill) would just about shut that down.”
Lynn said she was taken aback by the furor over the bill, which has reached national technology-trade publications.
“It’s more of a complicated issue than I anticipated,” she said.
Lynn said she has been criticized for even allowing the bill to be introduced, but she said that it’s a routine part of the process.
In committee meetings, “I say ‘Are there any objections?’ ” she said. “If nobody objects, it’s introduced.”
Mike Taylor, the lobbyist for Kansas City, Kan., said his city could also be adversely affected by provisions of the bill.
Kansas City has partnered with Google Fiber to install an ultra-high-speed network in the city. Google’s paying the bill, but the city gave the company expedited permit consideration and a discount on rent for space on utility poles, Taylor said.
“In exchange, they run Google high-speed fiber for free to about 135 school buildings, City Hall and community buildings, that sort of thing,” he said.
“We didn’t spend any tax money doing it,” Taylor added. But SB 304 “would probably prohibit future arrangements like that” and could possibly affect renewals of existing contracts when they expire.
But while Kansas City is big enough to have alternative sources for broadband, Chanute’s too small to attract that kind of investment from the private sector, Gates said. As a result, he said, the local cable service is so balky that nearly half the town’s residents subscribe to satellite TV instead.
In addition, he said, people go to the library if they have to download large files because it’s much faster than what they can do at home with cable or phone broadband service.
The city has been a state leader in broadband development since the 1980s, Gates said. In addition to its fixed broadband network, the city has free wi-fi in all its parks and public green spaces and a 4g mobile data network.
Gates said that advanced data infrastructure has paced economic and social development in Chanute, one of the few rural Kansas cities that’s growing while most are bleeding population. The local hospital can provide advanced telemedicine services and the local college, Neosho County Community College, is the fastest-growing in the state and among the fastest-growing in the country, he said.
Chanute hasn’t spent any tax money on the system, Gates said, using proceeds from the electric company to pay for building it. If access is expanded to all residents, those who use it will be billed for the service at rates projected to be comparable to what the cable and phone companies charge, he said.
Gates said he expects SB 304 to clear the committee. But he will be at the Capitol on Tuesday to testify against it anyway.
“I will do everything in my power to squash it,” he said.