California Lawmakers Ease the Rules for Rural Munis

Shortly after Republican FCC Commissioners repealed federal network neutrality protections late in 2017, state lawmakers began introducing legislation to protect their constituents. California’s AB 1999, introduced as one possible antidote to the FCC failure in judgment, passed the General Assembly on August 29th and is on its way to Governor Jerry Brown.

Read the final version of the bill and the Legislative Counsel Digest here.

Let the People Serve the People

As local communities have investigated ways to protect themselves from throttling, paid prioritization, and other activities no longer banned, they’ve looked at investing in publicly owned infrastructure. Rural communities where national Internet service providers are less motivated to deploy have always struggled to attract investment from the same large companies known to violate network neutrality tenets. Assembly Member Ed Chau’s AB 1999 addresses rural communities’ need for better connectivity, solutions that can preserve network neutrality, and challenges in funding broadband infrastructure.

California’s community service districts (CSDs) are independent local governments created by folks in unincorporated areas. CDSs provide services that would otherwise be provided by a municipality. Residents usually join together to form a CSD and do so to establish services such as water and wastewater management, garbage collection, fire protection, or similar services. A CSD also has the ability to create an enhanced infrastructure financing district (EIFD) in order to finance the development of a broadband network.

The EIFD statute granting the authority allows communities, including CSDs, to join together regional projects for a range of financing purposes. Tax Increment Financing (TIF) and various bonding mechanisms are a few examples.

The law currently on the books, which AB 1999 will change, requires CSDs to first determine that no private entity or person is willing to offer broadband in their sector before they are allowed to invest to do so. If they manage to get past the requirement but an entity or person enters the picture and is willing to provide those services, the CSD must sell or lease the infrastructure they’ve developed. AB 1999 will remove the “private sector first” requirement and allow CSDs to finance, build, and operate broadband networks in rural areas.

In addition to the changes in how CSD investment can be handled, the bill establishes that networks developed by CSDs must adhere to network neutrality policies.

On to the Governor

The bill worked its way through the committee process with strong support and along the way our Christopher Mitchell testified to lawmakers. You can listen to his testimony and a short discussion of the bill in the Communications and Conveyance Committee here. When AB 1999 appeared before the General Assembly for its final vote, lawmakers passed it 57 - 22.

Governor Jerry Brown now has 12 days to sign, approve without signing, or veto AB 1999. If you live in California, especially if you're in a rural region, you can still support this measure by contacting the Governor's office and letting him know that you want him to support and/or sign AB 1999.