Should NH allow cities to borrow money to build broadband anywhere?

Published: 07/19/2022 17:10:05

Modified: 07/19/2022 17:09:41

Over the past few decades, high-speed Internet access has become an increasingly important issue for many rural towns in New Hampshire. In the wake of the COVID-related lockdowns and resulting shift to remote working, the topic is more relevant than ever. Yet despite the demand, creating the infrastructure needed to connect distant cities comes with significant costs. In this article, we’ll examine the potential solution of “municipal broadband” as well as a recent proposal — SB 247 — to implement it.

What is Municipal Broadband?

Private companies that provide Internet services can make big profits by building Internet infrastructure in major cities where many potential customers reside. Unfortunately, sparsely populated cities are often left behind, as their customer base may be too small to justify the large initial investment ISPs would have to make. This is where the idea of ​​municipal broadband comes in.

Rather than a large company providing the Internet (think Xfinity or AT&T, for example), municipal broadband networks are run by local governments or utilities. They are designed to keep costs low and expand high-speed Internet access rather than making a profit. There has been a boom in municipal broadband since 2018, with growth of more than 600% in recent years.

In a variant of municipal broadband, cities can fund partnerships with private companies to expand broadband.

NH Municipal Broadband

In 2018 and 2020, significant legislation was enacted regarding local broadband in New Hampshire. SB 170 (2018) clarified that cities could borrow money in the form of bonds to pay for the construction of broadband infrastructure. Importantly, New Hampshire law states that municipalities must determine that an area is “not served” by broadband before issuing bonds for broadband expansion.

Later bills clarified how cities must identify underserved areas, which includes communicating with internet service providers. Some Granite Staters are not satisfied with this process to identify “unserved” areas. Historically, Internet service providers have counted a census block as “served” if only one or two residences are covered in that area. A 2021 report from Broadband Now examined this discrepancy and estimated that only 82% of Granite Staters have broadband access, compared to the Federal Communications Commission’s official estimate of 97%. The legal definition of “unserved” also doesn’t take into account whether residents want faster speeds than what’s available or whether residents struggle to pay for the service.

Many want to see New Hampshire communities take a more proactive stance in expanding high-speed Internet. That’s where SB 247 (2022) comes in. SB 247 would allow municipalities and counties to purchase bonds to expand high-speed Internet access anywhere, not just in places determined to be unserved by Internet service providers.

SB 247 was sent for interim consideration, which is usually a polite way to kill a bill in an election year. However, the proposal could very well come back in a later legislative session.

An opportunity for growth

Proponents of the proposal at the heart of SB 247 believe that, in today’s world, broadband is as much “essential infrastructure” as water and sewer. Therefore, it makes sense that cities would have broad authority to borrow money to ensure equitable Internet access for residents – even if those residents don’t live in completely “unserved” areas. This could be an economic boon for New Hampshire, allowing more businesses to operate there. It would also help New Hampshire students who use the internet for school or homework.

Unintended consequences of municipal broadband

Some worry that this proposal and others like it will put cities in direct competition with internet service providers and jeopardize the investments these companies are now making across the state. The costs of building and operating Internet networks are enormous – municipalities would not only have to set up the infrastructure, they would have to continually upgrade it and deal with outages. Such changes could create a situation where a provider that has borrowed millions to make its own investments in the state would see its efforts undermined by the municipal grid. Alternatively, it could impose inflated costs on taxpayers.

What do you think?

Although SB 247 failed to become law this year, similar proposals may arise in the future. Whether you like this idea or think it’s not good for the Granite State, you can make your voice heard! Start by finding out who represents you (and who is vying to represent you) by visiting citizencount.org. Sitting lawmakers can request bills for next year as early as September, so let your elected officials know if you have an opinion on municipal broadband or other bills.

Citizens Count is a nonprofit organization serving the New Hampshire community by providing unbiased information about issues, elected officials, bills, elections, and candidates. These articles are shared by partners of The Granite State News Collaborative. For more information, visit collaborativenh.org.

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