FCC To Vote On Municipal Broadband Rules Thursday; Overshadowed By Net Neutrality Debate

When the Federal Communications Commission meets Thursday to vote on proposed net neutrality regulations, the federal regulatory panel’s controversial rules on an “independent, fair and open” Internet are expected to overshadow another important issue on the same agenda.

The five-member panel also plans to take up the Obama administration’s proposal to halt regulations in several states that prevent local communities from building their own broadband networks, a ruling that supporters say could narrow the broadband gap between rural and urban areas in Arkansas.

According to the FCC’s agenda for Thursday, the commission will address whether two municipalities in North Carolina and Tennessee can preempt provisions of state laws that restrict the ability of local communities to provide their own broadband service.
Christopher Mitchell, spokesman for the Washington, D.C.-based Institute for Local Self-Reliance (ILSR), said the FCC ruling is expected to eliminate barriers to setting up municipal networks that allow communities to reap all the benefits of high-quality Internet connections at lower costs.

“In the short-term, it will only affect those communities in North Carolina and Tennessee,” said Mitchell, director of ILSR’s Community Broadband Networks Initiative. “But in the future, it will open the door for communities in Arkansas who want to offer broadband to petition the FCC to do so.”

ARKANSAS PSC SPOKESMAN SAY FCC RULING WON’T HAVE SIGNIFICANT IMPACT ON STATE BROADBAND SERVICES
According to the FCC, Arkansas is one of 21 states that have limitations or restrictions on the expansion of municipal broadband networks. The Obama administration and FCC Commissioner Michael O’Reilly have signaled that they have enough votes to pass the ruling on Thursday.

Currently, Conway and Paragould are the only Arkansas communities among the 150 municipalities nationwide that offer broadband service. In 2012, Siloam Springs voters defeated an $8.3 million measure to run fiber optic cable directly to homes and businesses and add cable, Internet and phone services to its city-owned utilities. Siloam Springs is served by Cox Communications and CenturyLink for cable, telephone and Internet access.

A year before, lawmakers passed new legislation in the 2011 regular session that amended the state Telecommunications Regulatory Reform Act restricting government entities’ ability to create their own networks, except for specific purposes.

Before 2011, state law prohibited any government entity from offering, directly or indirectly, basic exchange services. Under those rules, an Arkansas town couldn’t create its own telephone company that offered the traditional concept of telephone service.

Provisions in Act 1050 of 2011 expanded the prohibition to data, broadband, video and wireless. With the exception of those owning municipal electric utilities or cable television systems, Arkansas towns are now prohibited from offering broadband services to nonpublic entities.

Mitchell said the amended Arkansas law actually opens up the uses of those networks created for electric system or television signal distribution system use. The new language adds permission, directly and indirectly, to use those capacities to provide, voice, data, broadband, video and wireless.

There is also an entire new subsection in the Arkansas that allows government entities to purchase voice, data, broadband, video, or wireless telecommunications services from a private carrier – even if the local government is operating a network that could serve them.

The new 2011 exception creates an environment that expressly allows municipal electric and cable television systems to provide a number of telecommunications services, Mitchell said, “including broadband.”

“But the law is also more clear in preempting local authority for communities that do not own electric or cable television systems,” he said.

Still, John Bethel, executive director of the Arkansas Public Service Commission, said he doesn’t believe the FCC ruling will have a major impact in the state.

“There are no significant limitations on the provision of broadband in Arkansas,” Bethel said. “So, I do not think that the FCC action … will be significant in Arkansas.”

NET NEUTRALITY VOTES LOOMS OVER THURSDAY’S FCC MEETING
In addition to the vote on municipal broadband expansion, lawmakers in the nation’s capital are also bracing for a big fight on Thursday’s highly-anticipated vote on net neutrality.

On Wednesday, a House Energy and Commerce subcommittee held a hearing called “The Uncertain Future of the Internet” as a precursor to the FCC’s meeting. According to news reporters, subcommittee Chairman Rep. Greg Walden, R-Ore., invited FCC Chairman Tom Wheeler, but the Obama appointee refused to attend.

As part of President Obama’s technology agenda, the FCC is scheduling a vote on its 324-page set of new guidelines to regulate the Internet like utility services because the agency’s 2010 rules were tossed out by a federal court last year. Republican critics have lambasted the president’s proposal, siding with traditional cable and Internet providers who oppose the new regulations.

In a recent statement concerning net neutrality, the National Cable and Telecommunications Association said nearly $11 billion will be added to consumers’ bills as a result of the FCC’s alterations.

“The Internet works for Americans because government has wisely chosen to let the web grow and thrive without burdensome regulation and onerous red tape that can increase consumer bills, choke progress and smother innovation,” the NCTA said. “But instead of continuing this path of tremendous success, some want to radically change course and are urging the government to force a heavy-handed regulatory model on the Internet – called Title II – and to run it like a public utility.”

The Arkansas Cable and Telecommunications Association is affiliated with the NCTA. Talk Business & Politics reached out to a number of supporters and critics of the FCC’s proposal. This story will be updated as necessary.