An Anonymous Amendment To Ohio's Budget Could Block Broadband Expansion

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Editor’s Note: The Ohio state legislature voted early Tuesday morning to fully fund Gov. Mike DeWine’s broadband expansion request.

One of the lessons learned from the pandemic is the importance of high-speed internet service for business and online learning. But in Ohio, an anonymous amendment proposed in the state budget could halt efforts to increase access.

Gov. Mike DeWine wants to expand broadband grant funding by $250 million over the next two years. But the House recommended reducing those funds to $190 million and the Senate proposed removing it entirely.

The Senate amendment also would place restrictions on communities offering their own broadband services. One of those cities is Fairlawn, where officials have been working to provide municipal broadband options since 2013.

“This is an important utility that we put in,” said Director of Public Services Ernie Staten. “Our residents want it. Our businesses want it. We've served it to them.”

The town tried to attract a telecom company to set up affordable broadband service nearly a decade ago, Staten said, but no one was interested in serving Fairlawn’s 7,500 residents.

“We really wanted to just bring the service to our residents, to our businesses, to make that happen. And they declined,” Staten said.

The city opted to pursue offering broadband on its own, like a utility, without the help of a traditional internet service provider. It began operating Fairlawn Gig in 2013, though officials had to defend the service in court, suspending it briefly until 2016. But now, residents in the town and surrounding area can get the fiber optic connectivity they want, locally.

“We're just trying to supply the best service possible,” Staten said. “And if there is money in it, then that money is just going back into the system to lower prices or upgrade services.”

Fairlawn Gig has a high user approval rating, Staten said, based on numerous surveys since it was put in place. Many businesses and residents rely on broadband just as much as they do other utilities like electricity or water, Staten said, and the municipal option provides them what they need.

DeWine has tried to expand the same kind of internet access to other underserved areas of Ohio. A statewide initiative launched in East Cleveland in April leverages public-private partnerships to offer broadband to residents who need an affordable, high-quality alternative to traditional telecom companies.

A replica of the towers going up through DeWine's grant program to increase broadband access, starting in East Cleveland. [Taylor Haggerty / Ideastream Public Media]

The amendment to the Senate version of the budget wouldn’t allow such partnerships to continue, said Bryan Mauk with PCs for People, the national group working to provide the hardware and service for the pilot program in East Cleveland.

“It's funny. I mean, three months ago, this was heralded as the best, best practices and public private partnerships or how we get stuff done,” Mauk said. “And this is the kind of stuff we need to preserve.”

The state has additional broadband projects in mind for future funding, said Lt. Gov. Jon Husted. The budget amendment is cause for concern, he said.

“When you take the money out and you say that you don't want any of the private-public partnerships to occur that were solving the problem, it certainly makes one pause and wonder what the true motivation is here,” Husted said.

Supporters of the amendment, though, argue municipalities shouldn’t be focusing on areas where internet service providers are already willing to work. Instead,  the work to increase connectivity should be concentrated in areas that need it the most, said Ohio Senate President Matt Huffman (R-Lima).

“If they're using tax dollars to compete with the private sector, that's not what we want,” Huffman said.
“What we want those local governments is to go to the places that don't have service.”

But competing with private providers isn’t a bad thing, according to Sean Gonsalves with the Institute for Local Self-Reliance’s Community Broadband Network Initiative. Municipal broadband often leads to higher-quality connections and lower prices, Gonsalves said. Restrictions like the Senate budget amendment aren’t aiming to improve broadband service or access, he said.

“What these bills are designed to do is protect the regional monopolies, mostly cable companies, but also telecom companies who are internet service providers,” Gonsalves said. “They're looking to prevent any competition to their service whatsoever.”

Other states have put restrictions or outright bans on broadband access in the past, Gonsalves said, but Ohio is the first to do so in about 10 years. The pandemic has actually pushed a few places to make broadband more widely available, he said, including in Arkansas and Washington state.

It’s telling that Ohio’s amendment was slipped into the budget, where it might be easily overlooked, Gonsalves said.

“No one that we've seen in the Senate is willing to stand up and say it was me that submitted that budget proposal,” he said. “I think that is a pretty good indication that it's a bad proposal.”

The proposed amendment signals a preference for corporate tax cuts over residents’ needs, said Policy Matters Ohio Senior Researcher Amanda Woodrum.

“These are the communities hardest hit by the pandemic and COVID,” Woodrum said. “We should be focusing our investments into, essentially, areas of concentrated poverty, not pulling out the rug from underneath them.”

For cities like Fairlawn, it could be bad business, Staten said. The reliable, affordable municipal broadband access has brought 20 businesses and about 750 jobs to the area, he said, and improved the local real estate market.

“The effects have been just incredible. The schooling, the job market,” he said. “It's really grown the city when you thought we were landlocked, if you will. We didn't see a lot of growth. It is really made a difference.”

The Greater Cleveland Digital Equity Coalition is calling on Ohio state lawmakers to remove the amendment’s proposed restrictions on municipal broadband programs.

“[The coalition] is concerned that the effect of HB 110, in its current form will be to prevent Cuyahoga County, the City of Cleveland, and numerous other local jurisdictions from implementing much needed community broadband initiatives and public-private broadband partnerships,” the statement said, “and even prevent our plans to leverage federal funds to address the county’s digital divide through broadband deployment, broadband adoption, and digital inclusion efforts.”

The coalition, which includes the city of Cleveland and other local stakeholders, also called for the restoration of the House’s recommended $190 million in funding, as well as expanded funding for local programs.

The House and Senate have until Wednesday to reconcile their respective budget proposals, including determining how much funding will go toward broadband grant expansion and what restrictions will stand.

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