On Sunday, the Federal Communications Commission put out the 2016 Broadband Progress Report, and it showed that broadband access in West Virginia is improving.
Thirty percent of West Virginians now lack access to broadband compared to the 2015 statistics of 56 percent. But rural communities suffer the most – 48 percent of residents in these areas are without access to broadband.
While gains have been made, 70 percent broadband access still means that 554,124 West Virginians are limited in their ability to access online education, tele-health, expanded economic markets, and online government services. There is still work to be done, and it’s happening now.
There are three bills relating to broadband that have been proposed in the 2016 legislative session so far.
Defining “High Speed”
HB 2551 would prohibit internet service providers from offering to provide high speed internet service that is not at least 10 megabytes per second. This bill protects consumers from unfair or deceptive marketing from a telecommunications provider.
Tax Credits for Servicing Underserved Areas
SB 16 would provide tax credits to telecommunications companies that bring high-speed Internet service to homes and businesses that currently don’t have it.
The companies would receive a $500 tax credit for each new area they provide service to, and the state would award no more than $1 million a year in tax credits for all Internet providers combined.
These tax breaks are expected to cost the state about $6.1 million over the life of the program — about six years. This bill represents the “last mile solution,” providing an option to incentivize companies to build out internet from the off ramps of the “middle mile” interstate system to individual homes and businesses.
This solution is like building the internet equivalent of state and county roads. The original version of the bill would have allowed companies to simultaneously collect state tax credits and federal subsidies like Connect America Funds. On Friday, members of the Senate Transportation and Infrastructure Committee revised the bill so that companies can not take the tax credit on construction paid for with federal funds. The bill passed and now goes to the Senate Finance Committee. It is not yet on the agenda.
Building the Middle Mile
SB 315 would allow the state to sell bonds to create a 2,500 middle mile fiber loop throughout the state, estimated to cost a total of $72 million to construct.
After completion, Internet service providers would lease access to this middle mile network, with the proceeds used to cover construction costs and upkeep of the line.
The state’s current middle mile network is owned by large ISPs who can charge smaller providers a high price for access, limiting competition.
The idea behind this “middle mile solution” is that a state-owned middle mile network would increase competition and level the playing field for internet providers of all sizes, resulting in faster, more affordable internet.
Senator Walters’ SB 315 passed out of the Senate Transportation and Infrastructure Committee and now goes to the Senate Government Organization Committee. It is also not yet on the agenda.
SB 315 has seen significant pushback from the cable and telecommunications companies, who instead support SB 16 as a solution. In the Charleston Gazette on Sunday, Mark Polen, executive director of the West Virginia Cable Television Association, said that while SB 16 isn’t necessarily a “cure-all,” it “sounds like a reasonable approach.” This same article highlights support from Senator Ed Gaunch as well: “I like the idea of incentivizing [Internet providers] to get broadband to these unserved areas.”
The challenge of broadband access has been framed as an either/or debate – Last Mile or Middle Mile. However, I think the problem lies in both a middle mile network that limits competition, and a lack of last mile infrastructure to homes and businesses. We need to invest in strong middle and last mile solutions to see serious broadband improvements in the state.