Resource Central: TN and NC Appeal FCC Decision to Restore Local Authority

Nine months ago, the FCC voted to peel back laws in Tennessee and North Carolina that eliminate local authority and discourage expansion of broadband investment. As was expected, both states filed appeals and those appeals were consolidated for review by the U.S. Court of Appeals for the Sixth Circuit covering Michigan, Ohio, Kentucky, and Tennessee.

It has been a long and arduous journey for the parties, their attorneys, and local authority advocates. In order to help readers stay informed of the parties and their arguments, we gathered together a collection of resources related to the original Order and the Appeal. 

Downloads of briefs are available as attachments here.

Upper Arlington, Ohio Forges Ahead with Public Partners on City-wide Fiber-Optic Network

The City Council of Upper Arlington, Ohio on Oct. 26 approved several contracts that will enable the community to build a municipal fiber-optic network to key anchor institutions for an estimated $2.5 million.

Upper Arlington’s project will provide high-speed Internet service for the city’s buildings, the Public Library, Upper Arlington city schools, and most city parks according to a news report from the Upper Arlington News. The 30-mile fiber network will serve about 40 locations around the boundaries of the city (population 34,000).

Besides establishing better connectivity between the three public partners’ buildings, the network is expected to provide opportunities for commercial companies to lease telecommunications services. The network would allow the city to lease some of the 288 fiber strands to commercial companies, such as other Internet Service Providers (ISPs).

Financing and Break Even

Under the cooperative arrangement, the library will contribute $17,616 annually, the city $68,484 per year and the school district $177,900 each year until the project is paid off. “These costs are derived from the amounts that each entity is currently paying for leased broadband connectivity between their facilities,” Upper Arlington Assistant City Manager Dan Ralley told us. 

The period anticipated to pay off the network construction is nine years with the school district and library able to extend the parties’ shared-services agreement for an additional 15 years after. The extensions would occur in three five-year segments.

Cost savings, broader bandwith

Ralley says the primary benefits of the new city fiber-optic network will be significantly lower long-term bandwidth and broadband access costs.  For example, the city of Upper Arlington expects to save about $1,280 a month for Internet service by building its own fiber network. Over 10 years, the city’s savings would total about $150,000.

And the municipal network will be a boon for the Upper Arlington public schools. In an Oct. 19, 2015 staff report, Ralley said:

Upper Arlington Schools’ available bandwith capacity is a growing concern given the current and future 21st century learning initiatives that are premised upon the use of technology. With increased bandwith between buildings, the potential for ubiquitous computing is possible along with more collaborative learning tools delivered through online learning management systems.

Network will enable access to two major data centers

Another benefit: the new network will enable Upper Arlington to “gain direct access to two different data centers located on the periphery of our community,” Ralley told us. Those are “the Ohio Supercomputing Center and a private facility owned by Expedient that will allow us to locate our servers in a carrier neutral facility that has redundant power feeds and lower broadband access costs,” he noted. 

“Expedient can provide the City an internet connection of 30 Mbps which is burstable to 100 Mbps at a much lower cost than our current provider,” Ralley said in his Oct. 19 staff report. 

New network incentive for economic development

Not to be overlooked, Upper Arlington’s new fiber-optic network is also expected to boost the community’s desirability for economic development.

“The number of businesses that are looking for access to affordable, high bandwith is increasing,” Ralley said in his staff report. He added:

While Upper Arlington does not have a large number of businesses that would typically utilize fiber optic data connections, we have attractive commercial development areas where access to available fiber can be used to attract businesses that require large bandwith. The City could leverage the community fiber optic network for economic development incentives or use it to help lower the cost of operating a business in UA, thereby providing a competitive advantage.

In one case, the city will be providing dark fiber to a new Ohio State University Medical facility that is currently under construction, Ralley told us. That arrangement is a condition of a $500,000 grant that the state of Ohio has given Upper Arlington to build its fiber-optic network. Dark fiber, fiber-optic cable currently not in use, is particularly important for medical centers because it offers more control over network quality and allows for very fast networks at affordable budgets. 

Also the city will be entering into an IRU (Indefeasible Right of Use) with the fiber construction contractor Thayer, that will enable them to market and sublease fiber strands by other third parties, he said.

Given the direction of the Upper Arlington broadband network, the community will be getting a system that will have many potential benefits but little risk with the city serving as its anchor tenant.

Self-Financed EC Fiber Continues to Grow - Community Broadband Bits Podcast 177

Carole Monroe is back on Community Broadband Bits for Episode 177 this week, to discuss the East Central Vermont Fiber network and its unique financing model. Carole is now the General Manager for EC Fiber. She previously joined us for episode 36 to discuss Fast Roads in New Hampshire. And we previously discussed EC Fiber with Leslie Nulty in episode 9.

Years later, EC Fiber is approaching 1,200 subscribers in rural Vermont and is growing much more rapidly with some open access dark fiber connections created by the state in a specific effort to enable last mile connectivity.

We discuss the impact on the community, how much people in rural regions desire high quality Internet access rather than slow DSL, and also a brief mention of some progress in New Hampshire to expand the Fast Roads network.

Read the transcript from this episode here.

We want your feedback and suggestions for the show - please e-mail us or leave a comment below.

This show is 21 minutes long and can be played below on this page or via iTunes or via the tool of your choice using this feed.

You can can download this Mp3 file directly from here. Listen to other episodes here or view all episodes in our index.

Thanks to Arne Huseby for the music, licensed using Creative Commons. The song is "Warm Duck Shuffle."

Lake Oswego Seeks Out Expert Advice: Video

Lake Oswego, Oregon, was pegged as a potential target for Google Fiber in 2014 but this town of 35,000 may not wait for the tech giant to bring fast, affordable, reliable connectivity. They may just do it themselves.

In order to get more information about municipal fiber networks, our Chris Mitchell visited during an October City Council meeting at the request of community leaders. The Lake Oswego Review covered the meeting.

According to the Review, the northwest community issued an RFP in June and received two responses. City leaders are still pondering the responses and feelings are mixed over whether or not to make the investment.

City Manager Scott Lazenby told the Council:

Just getting this network would put Lake Oswego on the map…I think increasing that level of service, especially for the demographics we have here — highly educated, many tech-oriented folks in our community — that would be a real service to make available.

Chris pointed out that the area is ripe with a number of high-tech companies and other entities that will find a fiber network attractive. “Not everyone has that regional connectivity that you have here,” he told the Council.

He also asked them to consider all the long term possibilities if Google does eventually enter into the market in Lake Oswego:

“When I think about relying on Google, if Google decides to get out of this business, the community has no say about who takes it over,” he said.

After discussion, the Council voted to negotiate an agreement with one of the RFP respondents for further review, contingent on a market study.

To view Chris's entire presentation to the Lake Oswego City Council, watch the video below: 

Community Broadband Media Roundup - November 13


Colorado Residents Vote Overwhelmingly In Favor Of Municipal Broadband by Karl Bode, TechDirt

Boulder, Colo., To Light Up Fiber Optic Network by Alex Burness, GovTech

Boulder, Colo., Explores Benefits of Municipal Broadband by Julian Kimble, State Tech Magazine



Portland to pursue building municipal high-speed broadband network by Whit Richardson, Portland Press Herald, Maine Public Radio & Washington Times



Seattle officials debate $5M proposal to test municipal broadband network by Jacob Demmitt, GeekWire



What Comcast Doesn't Want You to Know About Data Caps by Timothy Karr, The Huffington Post

In documents leaked onto reddit last week, Comcast instructs its customer service representatives how to spin the expansion of data caps. The reasons for the caps, the documents say, are "fairness and [the need to provide] a more flexible policy to our customers." But what could be more fair and flexible than giving customers the unlimited data plan that many originally paid for?

DOJ won’t help FCC fight state laws that harm municipal broadband by Jon Brodkin, ArsTechnica

Four paths to abundant Internet bandwidth by Blair Levin, Brookings Blog

Silicon Valley Sides With FCC, Says Muni-Broadband Networks Can Close 'Digital Divide' by Wendy Davis, MediaPost

"The inadequate state of broadband competition has had a measurable impact on both an economic and societal level in the United States, and has created a gaping digital divide. Essentially, it has wrought a nation of two Internet access speeds: the fast lane -- where many Americans living in dense populations areas enjoy fast access to the Internet -- and the slow lane or even no lane -- where Americans lack similar abilities to access the undisputable benefits that broadband provides," the Internet Association says.

The group says the FCC's decision to lift restrictions on muni-broadband is "one component" of the effort to close that digital divide.

Markey Backs FCC Muni Broadband Preemption by John Eggerton

Roanoke Valley Broadband Authority Moving Forward

After multiple delays, the much anticipated Roanoke-Salem fiber network in Virginia has its feet on the ground. The network has secured an executive director who will provide greater project oversight and find Internet service providers (ISPs) to operate on the open access network.

Now that the project is under way, it is moving at a rapid pace. The Broadband Authority already secured a contract for $2.9 million to lay the conduit for the fiber optic cable, and crews are already at work. By year’s end, the project should finally be complete.

Two years ago, a completion date seemed far-fetched. The cities of Roanoke and Salem and the counties of Roanoke and Botetourt met to discuss the growing problem of poor Internet access in the region. The area had the reputation for being in a "doughnut hole" - too large to qualify for federal grants but too sparsely populated to attract investment from large telecom providers. The city of Roanoke, for instance, ranked 409th out of 429 US metropolitan areas for basic Internet access.

Officials knew the situation was bad for economic development. Affordable, reliable broadband access could help grow, and keep, local companies in the region and attract new businesses and institutions - especially the important textile and manufacturing jobs that had driven the local economy for generations. The two cities and two counties came together to fund a $50,000 study. The study recommended the creation a Roanoke Valley Broadband Authority and a 60-mile, $8.2 million, open access network.

After the initial stage, disagreements between the entities complicated the project. Botetourt County already had open access fiber managed by Mid-Atlantic Broadband Communities Corporation and felt additional redundancy from another fiber line was not worth the investment. Botetourt County Administrator Kathleen Guzi:

“We don’t believe we need the redundancy yet.” 

In Roanoke County, officials were hesitant to fund the network. Each government entity had agreed to provide $2 million to the project, and that presented a budget concern for Roanoke County. The county board also saw it as government encroachment on the private sector, distinct from an infrastructure project. Eventually, both Roanoke and Botetourt Counties withdrew from the project.

The cities of Roanoke and Salem expressed disappointment but acknowledged that they would move forward without the counties, according to Salem City Manager Kevin Boggess:

“If whatever we decide to do ends up going into a community that’s not fully participating, it’s still open access broadband for whatever business happens to be there. We’re not going to restrict anybody’s access to it. That’s the whole idea of this. We’re going to create something that’s open to every potential provider, every potential customer. It’s open access. That’s what it’s there for.”

After Botetourt and Roanoke counties withdrew, Roanoke and Salem entirely revamped the project. Scaling back the network to just 47 miles, they cut down the cost to less than $4 million. Salem's Municipal Electric Department uses existing fiber that can be integrated into the project, so the majority of the new fiber will run through Roanoke. Some of the fiber will still extend into parts of Botetourt and Roanoke counties.

The Virginia Resources Authority has issued a $6.2 million bond to cover the network’s construction and any unforeseen costs. Both cities have committed to repaying the debt on the bond until the network generates enough revenue to cover network costs and debt service. 

From philosophical disagreements to changing plans, it has been a long road for the fledgling Roanoke-Salem network. Now with an executive director and a $6.2 million bond, the Roanoke Valley Broadband Authority should complete the 47-mile, open access network by the end of 2015.

Roanoke Valley map from Foundation For Roanoke Valley

Hillary Clinton: Stop State Laws that Restrict Local Choice

In a position piece released in October, Hillary Clinton voiced strong support for local authority:

“Three-quarters of US households have at most one option for purchasing the Internet service families now depend on for shopping, streaming, and doing homework. When alternatives do emerge, however, as they have in places like Kansas City, prices go down and speeds go up……Closing these loopholes and protecting other standards of free and fair competition—like enforcing strong net neutrality rules and preempting state laws that unfairly protect incumbent businesses—will keep more money in consumers’ wallets, enable startups to challenge the status quo, and allow small businesses to thrive.”

The effort to stop state laws that limit local choice on broadband initiatives requires more political leaders to take a stand like the one Mrs. Clinton takes here against local monopoly power in favor of fair competition. Voters must become better informed about the insidious impact of centralized corporate power on their local freedom and demand that elected officials embrace policies to decentralize power.

As the Federal Communications Commission has made clear, broadband access is crucial to addressing quality of life issues including economic developmentgovernment performanceeducationmedical carepublic safetyenergy & environmental innovation, and civic engagement. Regardless of party affiliation, candidate platforms must acknowledge that fast, affordable, reliable Internet access for all is one of the biggest challenges facing communities around the nation.

Ting! Holly Springs, NC to Get a Gig

While Google Fiber and AT&T focus on the large cities of the Research Triangle of North Carolina, the small town of Holly Springs is pursuing a third option. 

Holly Springs will be the third town to see Ting’s “crazy fast fiber Internet.” After a successful foray into the U.S. mobile service market, the Toronto-based company Ting has started to provide Internet service by partnering with local governments. Ting will offer 1 Gbps in Holly Springs by building on the town’s $1.5 million municipal fiber network. 

Muni network restricted by state law

Holly Springs, with a population of almost 30,000, has worked hard to improve its connectivity. In mid-2014, they completed a 13-mile fiber Institutional network (often called an “I-Net”) to connect the municipal buildings and other public institutions, such as schools and hospitals. 

Unfortunately, when business and residents wanted to connect to the network, a North Carolina state law prevented the town from providing Internet services directly.  As it became obvious that Google Fiber would not pass through the town, leaders worked with a consulting company to try to draw in a private Internet service provider (ISP).

Ting! Innovative Partnerships

The locked-up potential of that fiber helped attract Ting. The municipal network's unused fiber will function as a backbone for Ting to deploy its own last-mile infrastructure, which will provide connectivity directly to homes and businesses.

Ting has had success with small towns. The first Ting town was Charlottesville, Virginia, where the company bought a local ISP’s existing fiber network, improving the speeds and prices. Most recently, Ting partnered with the city of Westminster, Maryland, to expand broadband access. The National Association of Telecommunications Officers and Advisors dubbed it 2015’s “Community Broadband Innovative Partnership of the Year” and presented the partnership with an award in September. Check out our podcast conversations with Dr. Robert Wack from Westminster and Elliot Noss, CEO of Tucows (parent company of Ting).

Local networks are the solution

Construction on the Holly Springs network is likely to begin in early 2016. Although not all public private partnerships prove successful, Ting’s approaches support the philosophy that communities should be empowered to make these decisions locally. Noss explained in the press release [PDF]:

The problem of slow, expensive and unreliable Internet access is national but agreements like the one reached with Holly Springs further demonstrate that the solution is local.

Grand Junction Asks "Fiber? Where?"

While other communities in Colorado are just starting to reclaim local control over their broadband futures, the city of Grand Junction has moved forward. In April, the people overwhelmingly overturned SB 152 – the state law that prohibited them from pursuing the best broadband solution for their community. Now Grand Junction is investigating its options.

The city council and the Downtown Development Authority (DDA) are in the process of hiring a consulting firm to develop a broadband strategic plan for the city of 60,000 and seat of Mesa County. One of the main tasks is to determine where to locate the fiber backbone of the proposed municipal network.

Where Will the Fiber Go?

In September, months after the vote, the city agreed to enter into a contract with the consulting firm. The city will pay for the majority of the cost – up to $83,000. According to DDA meeting minutes from September, the Authority will pitch in up to $16,000 [pdf].

The study will take two or three months and will look specifically at the pros and cons of a fiber backbone deployment through downtown Grand Junction. The downtown area houses many banks and businesses, as well as both city and county government buildings. Fiber would provide much needed high-speed connectivity for those facilities, reports the Daily Sentinel. Available office space, ideal real estate for tech firms, is also plentiful in downtown Grand Junction.

Next Steps

After the consultants complete the study, the city may choose to issue bids for Requests For Proposals (RFPs) from contractors interested in constructing the network. The DDA has a $1 million line of credit backed by the city and will take responsibility for the cost of installing fiber in the downtown area.

The hope is to encourage tech start-ups to come to Grand Junction, as the DDA Board Chairman Jason Farrington explained

“Any company that needed to play in that (world wide web) sandbox would have Grand Junction as a place to relocate.”

How Lobbyists in Utah Put Taxpayer Dollars at Risk to Protect Cable Monopolies

Facing the threat of municipal broadband networks disrupting their cable and telephone monpolies, big telecom lobbyists wrote a law to restrict municipal networks under the guise of protecting taxpayers. Here's the irony: the law put taxpayers at much greater risk even while restricting their choice of Internet and cable providers.

Before Business Week became Bloomberg Business, Brendan Greely and Alison Fitzgerald published a remarkable story entitled, "Pssst ... Wanna Buy a Law?" It offers chapter and verse on the role of cable and telephone incumbents using the American Legislative and Exchange Council (ALEC) to push Internet anti-competition restrictions in many states.

We have been reflecting on these laws that discourage or bar municipal broadband networks while drafting a brief for the 6th Circuit regarding the FCC decision to strike down monopoly-protection statutes in North Carolina and Tennessee. We realized that the Utah law isn't just anti-competitive, it dramatically increased the risk to taxpayers from building a municipal network in the state.

The Debt-Financed Wholesale-Only Model

Industry lobbyists convinced Utah legislators to restrict local authority over municipal networks to "protect" taxpayers and that argument is still frequently used today by groups opposing local Internet choice. The law does not actually revoke local authority to invest in networks, it monkeys around with how local governments can finance the networks and requires that municipalities use the wholesale-only model rather than offering services directly.

However, the debt-financed citywide wholesale-only model has proven to be the riskiest approach of municipal networks. Building a municipal fiber network where the city can ensure a high level of service is hard and can be a challenge to make work financially. Trying to do that while having less control over quality of service and splitting revenues with 3rd parties is much harder. This is why we recommend either incremental efforts or subsidizing the upfront capital costs for those who want to use the wholesale-only model (which we continue to believe has tremendous potential).

Spanish Fork vs Provo

The Utah law, while purporting to be about protecting taxpayers, puts them at greater risk. Consider two Utah municipal networks: Spanish Fork Community Network and iProvo. Both were studying municipal broadband at the same time with the same consultant. Spanish Fork moved quickly to build its network and was grandfathered into the 2001 Utah law designed to discourage municipal networks. Provo, being larger and needing to inform the public and get feedback before embarking on the project lost its opportunity to use the retail model because the state revoked its authority to do anything but wholesale-only.

We checked in with Kevin Garlick, Provo City Energy Director from 1997-2013, about this time period and he shared interesting details, including this:

As a successful and reliable municipal electric utility, we wanted to leverage our customer relationship by offering telecom services. The community and municipal council supported that. We wanted and planned to use the same retail model that Spanish Fork used. However, the state law essentially forced us to the adopt the more risky wholesale-only model that led to our financial problems.

Thanks for the Protection, Jerks!

The results from Spanish Fork, where the taxpayers were not "protected" by the laws drafted by cable and telephone lobbyists, the city has paid off all of its debt, regularly reinvested net income into local budgets, and is on its way to gigabit fiber. More details on Spanish Fork here.

Provo, saddled with the state restrictions that forced a riskier business model on it, was not financially sustainable. The network generated some benefits but the costs were too great and it eventually became Google Fiber. Many envy the network they now have but the intervening years certainly were part of the plan to improving Internet access.

Since the 2001 law to protect taxpayers from having a real choice in Internet providers, the only two municipal networks (iProvo and UTOPIA) that have been built have encountered major financial challenges and required subsidies to operate. Anyone trying to justify that law on the basis of helping taxpayers has some serious explaining to do. Local governments should be able to make these decisions without interference from states or Washington, DC.