COMMUNICATIONS DAILY: MUNIS OPT OUT OF COLORADO BAN ON COMMUNITY BROADBAND

June 8, from Communications Daily
By Adam Bender

A Colorado state legislator cheered an increasing number of communities that have voted to allow broadband deployment by their local governments, opting out of a 2005 state restriction. In a live-streamed keynote Tuesday at the Mountain Connect conference in Keystone, Colorado, Rep. Diane Mitsch Bush (D) supported the 57 communities that have voted to opt out. In another panel, financial consultants advised how to attract funding for communities that are moving ahead with muni broadband projects.

A 2005 Colorado law (SB-152) included an opt-out provision allowing local governments to hold public votes on whether to honor the muni ban, which includes public-private partnerships. Many municipalities opted out in the November 2015 election, with nine more opt-out votes in April, according to the Institute for Local Self-Reliance. Some argue that opting out means local governments will unfairly compete with the private sector, said Mitsch Bush. “I certainly agree that government at any level should not be directly competing with the private sector where the private sector is in fact providing or can provide for need and demand.” But local governments should step in where that’s not the case, she said.

Distance, density and terrain meant “fragmented” broadband in Colorado, Mitsch Bush said. Even areas with great broadband lack redundant networks, making them less resilient, she said. Poor broadband holds back local businesses, high-tech startups, education and public safety, she said.

Montezuma County citizens will vote in November whether the county should opt out from SB-152, said Rick Smith, general services director of the city of Cortez. The ballot also will ask whether to create a countywide broadband authority, and whether to support that body with a 1 cent sales tax increase, he said on a panel of public sector broadband officials Tuesday. “It’s a pretty ambitious plan” and, with the November ballot, the county aims to “hit the ground running,” he said.

“If broadband is important to your community, then you should find whatever method necessary to fund it properly [and] to make it happen,” said Bob Farmer, director of information services for the city of Glenwood: “Because broadband is important.” Service revenue supports Glenwood’s community broadband network, but that approach has disadvantages, he said. “When you’re a small network and you have small revenues, it takes a lot longer to do anything.” It’s difficult to hire enough people, making it harder to expand quickly, he said. “We have really good growth rate — even without advertising, word of mouth is really strong — but we can’t meet demand.”

Municipalities wanting to attract financing for community broadband should write sharp plans, said financiers for community projects in a panel Monday. Municipalities should have a clear understanding of what’s realistic, what the community needs, and what resources they have available when planning a community broadband project, said Jason Gredell, head of the J.P. Morgan public infrastructure advisory group. Hiring an adviser may be helpful for guiding governments through the process, he said. “Too many times I’ve had discussions” where the municipality has lofty goals but doesn’t want to pay for it, he said. Also, It’s important for a municipality to put some “skin in the game” by providing some of the funding, Gredell said. It may need to put in more money for more difficult-to-serve areas, he said. Communities should look to bring in all available resources, including capital, commitments to rights of way and construction permits. “Make sure that you have come up with all the resources that the city or authority is capable of giving.”
Municipalities should design a project that’s right for them, rather than try to copy what other places have done, advised Brian Garcia, Aegis Capital managing director of municipal finance. “Put together a clear plan of what you want, what you need [and] why you need it.” A community should have a strong advocate for its project, said Kevin Padrick, chairman of Symmetrical Networks, a community broadband consultancy that coordinates public-private partnerships. “As a provider of financing, we want to make sure … that you’re committed to the process, and then we’re happy to commit our capital and our time to the process.”

Communities should act fast, Garcia said. “If you’re thinking about doing this, really start accelerating it,” because within five years telecom incumbents may start “cherry picking communities so that you can’t … economically deploy a municipal broadband network.”