August 11, 2017
Lawmakers in Kentucky are growing more and more worried about the government’s statewide, taxpayer-financed broadband network, KentuckyWired. According to WFPL, during a legislative hearing on August 3 “lawmakers expressed anger” about the system’s “delayed launch and uncertain financial outlook.”
Lawmakers expressed other concerns as well. Rep. Michael Meredith suggested that he was worried that the network would dampen private sector investment in broadband. Rep. Jim Wayne said, “I think what we’re seeing here is a very ill-conceived program that had been designed with very good intentions.”
Phillip Brown, executive director of the Kentucky Communications Network Authority (KCNA), testified at the hearing. (KCNA oversees KentuckyWired.) He blamed the delays on “difficulties” KCNA has had “setting up agreements with owners of telephone poles that the fiber optic wire needs to hang from.” Brown testified during the hearing that KCNA still needs the agreements for about 6,600 poles, or 12 percent of the total required to finish the system. If KCNA cannot secure those agreements, he said, KCNA would “have to take the unfortunate step of redesigning the network so that we don’t need those poles anymore … And what that means is we wouldn’t be building into those locations.”
Kentucky Senate Appropriations Committee Chairman Chris McDaniel was one of the many other lawmakers who criticized KCNA and KentuckyWired. Sen. McDaniel argued the state should simply abandon the project. He said, “I want a shutdown plan, with financial costs to shut it down, stop work.” He asked, “What’s it going to cost us to get out of this?” Rep. Tim Couch, said KentuckyWired is “boondoggle” that should be cut back.
KentuckyWired will cost $324 million. About 10 percent of that total came from the state government in the form of bonds.
According to the Kentucky League of Cities, Rep. Phil Moffett pointed out that the bonds used for KentuckyWired “were based on $11 million that was supposed to have been put into the project by school systems,” but never materialized. Moffett said, “We actually issued $30 million worth of bonds under fraudulent revenue projections and the people who bought those bonds ought to sue.”
Lawmakers also discovered during the hearing that KCNA has no idea when KentuckyWired will be finished. According to the League of Cities, KCNA’s Brown told lawmakers that construction “will go beyond 2018.” Brown also “couldn’t provide a new end date.”
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