TACIR Hearing on Broadband

Last month on October 21, TACIR held a hearing on broadband in Tennessee as part of its study on the topic. The hearing was broken down into two panels: a panel of broadband providers and a panel of communities and broadband users. The broadband providers’ panel included incumbent providers like AT&T, cable, and telephone cooperatives, along with municipal and cooperative electric systems. The panel of communities and broadband users included representatives from the sectors of education, public safety, economic development, local officials, and the Tennessee Farm Bureau.

Testimony went about as anticipated: incumbent providers trumpeting that their services are meeting the needs of Tennessee, while municipal electric broadband providers came under attack as they advocated to change state law so they can better serve their communities. Meanwhile, local officials and representatives of different interest groups are clamoring for better internet service and sometimes they said they don’t get service at all.

One of the more frustrating aspects of the hearing were the usual attacks by the cable industry that local electric systems are the increasing costs (i.e., pole attachment rates) that prevent more expansion of broadband, and that not a single one of municipal electric broadband providers were a success. On the first attack, Mike Knotts of the Tennessee Electric Cooperative Association used maps of several states that each have different pole attachment rate regulations to show that density is the determining factor in broadband deployment. Also, Rep. Mike Carter reminded the cable industry representative and the commission of current state law that allows for half-off pole attachment rates for broadband deployment in underserved areas, for which the cable industry representative didn’t have a response.

On the second attack, TMEPA issued a press release setting the record straight on the financial condition of municipal electric broadband providers. (That press release and a Myths document is also in this newsletter under Association News). The cable industry attempted to confuse the issue of debt and deficits, essentially arguing because municipal providers have debt they are therefore in bad shape. Ken Webb, President/CEO of Cleveland Utilities who is also a CPA, told the panel, "The existence of debt itself is not the determining factor. The determining factor is the ability to pay that debt back." All current municipal electric broadband providers that are offering full broadband service are cash flow positive with a net positive monthly income.

Ben Lovins of Jackson Energy Authority (JEA) shared JEA’s story of how and why it began offering broadband service, the benefit to the area, and the mission of JEA. Ken Webb of Cleveland Utilities discussed his utilities study of the issue, what broadband in a community should be like, and the benefits of being able to partner with other systems under if TMEPA’s bill passed. As the stated mission of the TACIR study is to look at all broadband in Tennessee, municipal electric broadband providers were only a portion of the hearing.

Perhaps the most striking takeaway from the hearing were the local elected officials that still need better broadband service, and in some cases any at all. The TACIR commission is comprised primarily of legislators and local officials like county and city mayors. Many county and city mayors shared stories from their communities of businesses and offices in the heart of their community’s downtown area with poor or nonexistent access to broadband service, questioning the claims of coverage by the incumbent private providers. The Hickman County mayor said he gets internet service at his home through a mobile hotspot through his smart phone and that when his son tried to download a game for his PlayStation it took four days.

The panel of communities and broadband users brought the expected examples of poor broadband service and calls for better and expanded broadband service. Schools need better service since TCAP testing will be offered all online soon. The public safety sector needs it for interconnectedness, and how right now it’s behind. The need for fast upload speeds because of the rapid adoption and use of cloud services that connect mobile, tablet and desktop devices instantaneously. Rural areas need quality broadband to compete with urban and suburban areas, and that rural areas need quality wireless service in the field along with a quality wired connection in the home to download the data gathered in the field.

Currently, TACIR will have a preliminary report ready in January 2016, with the final report due at the end of March 2016. The Tennessee Department of Economic and Community Development is conducting its own study of broadband availability in Tennessee, which is scheduled to be completed in February 2016. All of these developments are sure to add to the excitement for the legislative session on this issue. TMEPA staff and everyone involved with municipal electric broadband providers are in regular contact with TACIR staff to make sure they have the information that need to put together a complete report.

 

TMEPA’s press release from the hearing can be found at HERE. Video of the hearing is available HERE.