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What Happens When Municipal Broadband Fails? You Pay.

November 19, 2014

iStock_000003994351MediumRecently a New York Times article on Federal Communications Commission (FCC) Chairman Tom Wheeler’s effort to overturn state municipal broadband laws highlighted what happens when government-owned broadband goes wrong. The story cited a study this year by New York Law School’s Charles M. Davidson and Michael J. Santorelli that found “several municipal systems have failed, including those in Burlington, Vt.; Monticello, Minn.; and Dunnellon and Quincy, Fla.” (An editorial by the Monticello, Minn. Times agreed its city network has failed. The editorial said, “We concur entirely with this point in the report. … The city’s attempt to run a high-tech business that will continue to be highly capital intensive has not been successful.”)

The New York Times said state laws limiting the growth of municipal broadband networks are “intended to keep taxpayers from being stuck with a bill” when networks like Monticello’s fail. The article also notes many state municipal broadband laws simply require that citizens be able to vote on whether or not their local government enters the broadband market. While opponents of these state laws argue these requirements prevent municipal networks from being built, The New York Times says that’s not right either, noting in Colorado “two cities and six counties approved ballot measures this month allowing for local broadband.”

The New York Times also argues the FCC Chairman Wheeler’s preference to overturn state laws may be on shaky ground. The newspaper quotes Free State Foundation President Randolph J. May who said, “I am pretty confident that if the F.C.C. pre-empts state laws, they ultimately will lose those cases … The Supreme Court jurisprudence is pretty clear.”

State municipal broadband laws are meant to protect taxpayers and consumers by preserving a level playing field between private sector broadband providers and public ones and by making sure local governments have done their due diligence before entering the broadband marketplace.

And now that you’ve read The New York Times story – and the Davidson and Santorelli report it cites – about government broadband failures, you know why these laws are necessary and why the FCC should let them stand.