When it comes to broadband, industry and lawmakers work hand in glove

When Joyce Coltrin emails local customers of her wholesale garden nursery, she makes sure to keep her messages brief and doesn’t attach photos or documents. “I try not to write lengthy emails, because people here are using very expensive ways of reading them,” she says. With no reliable broadband service available, many residents of this small community in rural Bradley County, Tennessee, rely exclusively on 3G cellular networks for Internet access. “People are paying in the range of $300 a month using their cellphones,” she estimates, and service can be slow. “Students have to go all the way into town to a McDonald’s or Starbucks and use their Wi-Fi networks just to do schoolwork.”

Even more frustrating for Coltrin and her neighbors is that just down the road, in the same county, communities have access to a publicly owned fiber optic broadband network that delivers speeds of up to 1 gigabit per second. That network is financed and operated by EPB, a local electric utility that has been selling affordable high-speed broadband to residential and business customers since 2009.

EPB has a fiber optic line just half a mile from her office Coltrin, said, so she was surprised to learn that they can’t sell their service to her. That’s because a 1999 Tennessee law prohibits a public operator like EPB from expanding broadband services beyond its utilities footprint. EPB’s network may be offered only to its electricity customers.

Tennessee is hardly an outlier when it comes to limiting what’s known as municipal broadband, networks run by public entities or in public-private partnerships like Google Fiber. Nineteen states have laws significantly restricting or effectively banning municipal broadband. And each year new bills surface in statehouses across the country in attempts to increase that number. Supporters of these laws argue that capital-intensive projects like fiber broadband are too risky for local communities to pursue, given that taxpayers are left to foot the bill should a project fail.

A look at the legislative process in some of these states, however, reveals very close collaboration between the cable industry and lawmakers where the primary goal is simply to protect private companies from public competition.

In May 2011, North Carolina passed H129, a bill that effectively blocks new municipal broadband efforts with strict limits on financing methods and minimum retail pricing while requiring municipal broadband networks to pay state and local taxes as if they were for-profit businesses. The bill’s House sponsor was Rep. Marilyn Avila, R-40th District. In February of that year she arranged a meeting to bring opponents and proponents together for negotiation over the legislation. Avila, according to multiple people who attended that meeting, shocked opponents of the bill by quickly handing over the proceedings to Marcus Trathen, a lobbyist for Time Warner Cable whose law office also houses the North Carolina Cable Telecommunications Association, the industry’s trade group. 

“Everybody on our side was like, ‘You’ve got to be kidding me,’” says Catharine Rice, a community broadband advocate. “[Trathen] ran the meeting, asked what was in the bill that people didn’t like and justified all the different pieces of it that he thought were fine. He was doing this without even looking at the bill, reciting it from memory. So we knew he was deeply involved in it.”

A second person that attended the meeting corroborated Rice’s account, speaking on condition of anonymity.

In a phone interview, Avila denied that Trathen led the meeting. “I led it. I called it. I brought all the participants together,” she said. Asked if Trathen wrote all or part of the bill, she stressed that the final version of the bill had “input from every stakeholder. No one person, group or entity can take ownership of that legislation.” When asked who had written the version of the bill that was discussed at the February meeting, the first opportunity opponents had to offer input, Avila declined to answer, dismissing the line of questioning as “way off of the whole issue.”

The charge of legislators submitting bills written by industry lobbyists is not without precedent in North Carolina. In a 2010 television interview with Charlotte’s NBC affiliate, retiring state Sen. David Hoyle admitted he did just that in a failed attempt to pass a bill earlier that year restricting municipal broadband. When asked, “Did the industry draw up that bill?” Hoyle replied simply, “Yes … with my help.”

In 2014 a restrictive anti–municipal broadband bill was submitted to the Kansas state Senate. It would have allowed new municipal broadband networks to be deployed only in “unserved areas,” defined in the bill as areas where at least 90 percent of households lacked access to wireless or satellite service, effectively putting the entire state off-limits. Although it listed no sponsor, public uproar followed once it was reported that the bill was written by John Federico, the president of the Kansas Cable Telecommunications Association, a trade group whose members include Comcast and Time Warner Cable. "Admittedly, that definition was overly broad," he told technology news site Ars Technica after his role in writing the bill was disclosed.

Local lobbyists aren’t the only source of bills for pro-business legislators. The American Legislative Exchange Council, an influential limited-government group funded by Charles Koch and David Koch and major U.S. corporations, prides itself on supplying model legislation on hundreds of issues. Written by industry representatives and member legislators working side by side, these bills are legislation-ready. As a result it’s not uncommon to see bills in various states containing nearly identical language.

A 2012 Georgia bill, SB313, proposing municipal broadband restrictions (it ultimately failed) includes several lines taken verbatim from ALEC’s model bill and whole sections with language identical to that used in Avila’s North Carolina law.

Despite these statewide attempts to subvert local control, there are more than 400 communities throughout the U.S. with publicly owned broadband networks, said Christopher Mitchell, director of the Community Broadband Networks Initiative. He added that if private companies want to avoid competition all they really have to do is offer services where residents are asking for them. “I don’t know of a place where [communities] haven’t started off by asking [a private provider] for investment. Local governments already have a lot of responsibilities. They don’t want to add a massive new responsibility if they don’t have to.”

There are state lawmakers keen to pass legislation rolling back some of the existing restrictions. In Tennessee, state Sen. Janice Bowling, R-16th District, has submitted a bill that would allow utilities like EPB to serve broadband customers beyond its utility footprint, a solution that would give Coltrin and her neighbors access to faster, more reliable and cheaper Internet access.

While optimistic about the odds of getting her bill passed, the defeat in last year’s session of a similar bill she proposed has left her with no illusions about what she’s up against. “Lobbyists do exert a lot of pressure,” she says. Referring to efforts that derailed her earlier bill, she notes that incumbent broadband providers spent “$250,000 to $300,000” on lobbyists to “wear people down. The Hill was crawling with them,” she recalls. And it’s not as if they have to convince huge numbers of lawmakers to kill pending legislation. “If you target the membership of the subcommittees in the House and the Senate, it’s not much more complicated than that.”

Hovering over this battle between local and state authority is the Federal Communications Commission’s Feb. 26 vote to pre-empt state laws that restrict the coverage area of municipal broadband networks. The move came in response to petitions from Chattanooga, Tennessee, and Wilson, North Carolina, seeking relief from existing state legislation. State attorneys general from Tennessee and North Carolina are expected to pursue litigation challenging the commission’s authority to override state law.