How States Are Fighting To Keep Towns From Offering Their Own Broadband

from the lobbying-dollars-at-work dept

Thu, Jul 2nd 2015 7:25am — Leticia Miranda, ProPublica

Earlier this year, the Federal Communications Commission voted to ease the way for cities to become Internet service providers. So-called municipal broadband is already a reality in a few towns, often providing Internet access and faster service to rural communities that cable companies don't serve.

The cable and telecommunications industry have long lobbied against city-run broadband, arguing that taxpayer money should not fund potential competitors to private companies.

The telecom companies have what may seem like an unlikely ally: states. Roughly 20 states have restrictions against municipal broadband.

And the attorneys general in North Carolina and Tennessee have recently filed lawsuits in an attempt to overrule the FCC and block towns in these states from expanding publicly funded Internet service.

North Carolina's attorney general argued in a suit filed in May that the "FCC unlawfully inserted itself between the State and the State's political subdivisions." Tennessee's attorney general filed a similar suit in March.

Tennessee has hired one of the country's largest telecom lobbying and law firms, Wiley Rein, to represent the state in its suit. The firm, founded by a former FCC chairman, has represented AT&T, Verizon and Qwest, among others.

James Tierney, director of the National State Attorneys General Program at Columbia Law School, said it is not unusual for attorneys general to seek outside counsel for specialized cases that they view as a priority.

Asked about the suit, the Tennessee attorney general's office told ProPublica, "This is a question of the state's sovereign ability to define the role of its local governmental units." North Carolina Attorney General's office said in a statement that the "legal defense of state laws by the Attorney General's office is a statutory requirement."

As the New York Times detailed last year, state attorneys general have become a major target of corporate lobbyists and contributors including AT&T, Comcast and T-Mobile.

North Carolina is no exception. The state's Attorney General Roy Cooper received roughly $35,000 from the telecommunications industry in his 2012 run for office. Only the state's retail industry gave more.

The donations are just a small part of contributions the industry has made in the states. In North Carolina's 2014 elections, the telecommunications industry gave a combined $870,000 to candidates in both parties, which made it one of the top industries to contribute that year. Candidates in Tennessee received nearly $921,000 from AT&T and other industry players in 2014.

The FCC's decision came after two towns – City of Wilson in North Carolina and Chattanooga in Tennessee – appealed to the agency to be able to expand their networks.

The vote has rattled some companies. In a government filing earlier this year, Comcast cited the FCC's decision as a risk to the company's business: "Any changes to the regulatory framework applicable to any of our services or businesses could have a negative impact on our businesses and results of operations."

If the court upholds the FCC's authority to preempt restrictions in North Carolina and Tennessee, it may embolden other cities to file petitions with the agency, according to lawyer Jim Baller, who represents Wilson and the Chattanooga Electric Power Board. "A victory by the FCC would be a very welcome result for many communities across America," said Baller.

For some residents in and outside of Chattanooga, clearing the way to city-run broadband would mean the sort of faster Internet access that others might take for granted.

For 12 years, Eva VanHook, 39, of Georgetown, Tennessee, lived with a satellite broadband connection so slow that she'd read a book while waiting for a web page to load. In order for her son to access online materials for his school assignments, she'd drive him 12 miles to their church parking lot, where he could access faster WiFi.

Charter, the local Internet service provider, declined several requests by her husband to build lines out to her home. Only last month did Charter connect her home to the Internet. "Even the possibility to jump on [the local utility's] gigabit network would blow our minds right now," VanHook said. "There is nothing faster than Chattanooga. Just through meeting them and hearing them speak and having them understand what's going on, that's the kind of place I want to do business."

Republished from ProPublica.

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Filed Under: broadband, fcc, isps, lobbying, municipal broadband, north carolina, states, tennessee
Companies: at&t, verizon, wiley rein

23 Comments

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Ninja (profile), 2 Jul 2015 @ 5:49am

You see, other ISPs can still offer their services even with a municipal broadband in place. As far as I understood being municipal doesn't mean being free or altruistic but rather actually making the service available with quality where the private sector has failed to do so.

Then the question is: what is the problem with municipal broadband again?
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TheResidentSkeptic (profile), 2 Jul 2015 @ 7:05am

Comes down to a simple decision
We have 2 million in profit to spend... we can either upgrade and expand our service offerings to our customers and get more customers and grow our business....
or we can just pay 1 million to a few politicians to tell everyone how wonderful we are and give ourselves bonuses with the other million.
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Ninja (profile), 2 Jul 2015 @ 7:31am

Re: Comes down to a simple decision
As long as short term profits keep being good and not greatly damaging the company in the long run they'll keep at it.
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DigDug, 2 Jul 2015 @ 7:56am

State Attorney Generals - Listen Up
Your job is to protect your people, not Corporate Greed you ignorant miscreants.

Right now those corporations you hold so dearly are doing the absolute minimum they can get away with, while taking state money in one hand, and tax breaks in another.

You rant and wail and gnash your teeth that the FCC is taking away your "rights" to hold your cities hostage, to take away their "rights" to be self controlling.

If your Cities want municipal broadband, you don't have the right to stand in their way. The FCC is correct and just in holding a knife to your throat so that you stop protecting corporate greed over community rights to decide what is best for themselves.

You hold your job by the will of the people, not by will of the Corporations.

Think about whether or not you want to continue to fuck the people of your state over like this.

The people who decide your political fate, and hold your career in their hands might just take offense at your choice to serve Big Media Empire instead of your constituents.

That could end up being your a very big mistake.

People get angry, and when they get angry, bad things happen. Something to ponder on, don't you think?
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Berenerd (profile), 2 Jul 2015 @ 8:11am

The good fight....
I learned a long time ago, you pick your fights. In this case, these AGs are picking the wrong fights for the people but the right fights for their financial futures.
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Anonymous Coward, 2 Jul 2015 @ 8:34am

Comcast cited the FCC's decision as a risk to the company's business: "Any changes to the regulatory framework applicable to any of our services or businesses could have a negative impact on our businesses and results of operations."

Comcast cited the FCC's decision as a risk to the company's business: "Any changes to the regulatory framework applicable to any of our services or businesses could have a negative impact on our bloated businesses and interfere with us gouging customers as our principle operation."

There fixed it for you.
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Anonymous Coward, 2 Jul 2015 @ 9:11am

"This is a question of the state's sovereign ability to define the role of its local governmental units."

'This is a question of the state's sovereign ability to define the role of its local governmental units... in lining our pockets here at the state level.'

Someone cut off the quote too early.
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Anonymous Mouse, 2 Jul 2015 @ 9:27am

"This is a question of the state's sovereign ability to define the role of its local governmental units."

But not a question of the local governments' sovereignty? Who are the corporations to say that they can't spend the tax dollars on things that the taxpayers actually want to spend them on?
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Anonymous Coward, 2 Jul 2015 @ 9:54am

Re:
Corporations are the only thing that matters. Hence corporate sovereignty. Corporations are more sovereign than voters, states, countries, and governments. After all who is it that keeps greasing the palms of politicians and regulators?
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Anonymous Coward, 2 Jul 2015 @ 10:00am

Re:
Who are the corporations to say that they can't spend the tax dollars on things that the taxpayers actually want to spend them on?

The same corporations who take money off of customers to lobby against their customers interests.
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BW (profile), 2 Jul 2015 @ 10:19am

Re: State Attorney Generals - Listen Up
They don't care at all, and they're NOT afraid of the people. In a best case scenario we get to choose from a field of three or four people, but often there is no choice. Even if there is a choice, our cognitive limitations ensure that we aren't likely to remember which candidate is the lesser evil.

When Attorney General Eric Holder was cited for contempt of Congress no one prosecuted him. When Attorney General Kathleen Kane refused to prosecute corrupt Democratic officials who were caught on video and audio taking bribes to oppose Voter ID, she responded by accusing critics of racism and sexism, and was never prosecuted.

Attorneys General are laws unto themselves, and frequently run unopposed. The only deciding factor for them is "where's the money?" Fear the poeple? Don't make me laugh!
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connermac725 (profile), 2 Jul 2015 @ 1:19pm

IN THE ISP'S POCKET
I'd bet that attorney general in Tennessee has gotten some payout/"campaign contribution"(wink wink) from the ISP's there to stop those town from getting good internet forcing them to stay with the lacking service they provide
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DigDug, 2 Jul 2015 @ 2:10pm

Re: Re: State Attorney Generals - Listen Up
You don't think that some angry rebel red-neck (who also happens to be a Marine Recon Sniper) wouldn't just open season on them?

Don't make me laugh... Of course they would...

Our Government better wake the hell up, or there's going to be hell to pay, and they don't have enough to pay what they owe.
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Pragmatic, 3 Jul 2015 @ 5:25am

Re: Re: Re: State Attorney Generals - Listen Up
Then get labeled a terrorist, then be sent to jail for a bazillion years...

...I don't recommend violence as an approach. Try getting more people involved in the democratic process. The fact that we don't or won't work together is the problem. And due to Partisan Nitwit Disease, it's a feature, not a bug.
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Pragmatic, 3 Jul 2015 @ 5:27am

Re:
"This is a question of the state's sovereign ability to define the role of its local governmental units."

It seems that democracy does not extend to local governmental units or the people therein. Why do the people put up with this crap?
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A. Nnoyed (profile), 3 Jul 2015 @ 5:32am

Instant replay, ISP'S are using the same scheme as the power cartel used in the 1930's.
In the 1930's the Power Cartel refused to construct their power distribution systems in rural areas because it was TO EXPENSIVE. When the Roosevelt administration founded the Tennessee Valley Authority the power Cartels fought government deployment of power distribution systems in rural areas, like the ISP"s are doing against broadband WAN deployment by Government Agencies. See discussion in this article:

https://en.wikipedia.org/wiki/Tennessee_Valley_Authority

Here in Central Florida the City of Mount Dora and the City of Leesburg constructed their own power distribution systems which they still operate. Residents receive a combined Water, Electric and Trash pickup bill.
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Odyss, 3 Jul 2015 @ 6:11am

Municipalities Expect the State Government to Bail them out if they are wrong!
Of course the states should win the court case, reassuring their jurisdiction over towns and cities in their state. Any other suggestion is silly. Towns and cities are expected to be bailed out by the state government if they go bankrupt through stupid decisions. Why should the state government, who is bankrolling these bailouts, not be able to control the spending decisions of the municipalities? In fact, I would assume cities and towns exist at the whim of the state government.

In NC, Apex, a suburb of Raleigh, and other towns the municipal leaders were so much smarter than the energy experts they invested in nuclear reactors. Apex municipal electric board has higher electricity rates than surrounding municipalities because of it. And these municipalities blocked electricity market reforms unless they got bailed out of their bad decisions over 30 years ago. I would hope the state government stands firm and stops these fools from delving into areas they know nothing about.
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odyss, 3 Jul 2015 @ 6:16am

Re: Instant replay, ISP'S are using the same scheme as the power cartel used in the 1930's.
Well, if it is a loser why would anyone invest? No, we do not have a right to both lower home prices from living in the middle of nowhere AND forcing our neighbors to subsidize delivery of services.

Wikipedia is a rotten source of info. The TVA not only brought power to rural areas, it brought it to areas already served by private firms and drove them out of business with government subsidized power. How would you like to play a sport where your opponent is also the referee? How would you like to be in business where your competitor also gets access to lower interest loans AND can send out all sorts of inspectors to harass you?
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That One Guy (profile), 3 Jul 2015 @ 1:40pm

Re: Municipalities Expect the State Government to Bail them out if they are wrong!
Completely unlike the cable companies of course, who demand huge tax breaks and other financial incentives to lay out networks, fail utterly, and then basically bribe their way out of fulfilling their half of the bargain by getting them pet politicians to nullify the deal after the fact.

No, you're completely right, municipal broadband always fails, and taxpayer funded private broadband always delivers, so clearly people should be blocked from being able to decide where their taxes are being spent. /s
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Anonymous Coward, 3 Jul 2015 @ 6:33pm

Re: Re: Instant replay, ISP'S are using the same scheme as the power cartel used in the 1930's.
Are you Rupert Murdoch by any chance?
He hates any competition he can't buy out & shut down either.
To hell with what the citizens want or even need, it's what the rich & powerful desire that matters.
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tqk (profile), 4 Jul 2015 @ 4:08pm

Re:
... what is the problem with municipal broadband again?

No predator appreciates competition predating on their territory, and for the predator's food supply to rise up and attempt to eliminate him is a vile affront. How dare they?!?
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tqk (profile), 4 Jul 2015 @ 4:30pm

Re: Re: Instant replay, ISP'S are using the same scheme as the power cartel used in the 1930's.
Wikipedia is a rotten source of info.

Bull shit! It's a free encyclopedia and a work in progress, under constant revision and update, ongoing. No, it's not a grand a year subscription from Elsevier for a prestigious journal, but it's hardly dog shit.
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rstat1, 4 Jul 2015 @ 9:14pm

Re: State Attorney Generals - Listen Up
Oh but don't you remember, Corps are people now >_>
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