State and Local Governments Must Stop Restraining Broadband Expansion | Citizens Against Government Waste

State and Local Governments Must Stop Restraining Broadband Expansion

The WasteWatcher

The proposed expenditure of $65 billion for broadband in the bipartisan infrastructure bill that passed the Senate on August 10, which would be added to the tens of billions of dollars already made available through prior spending bills, could be delayed for months, and end up being more costly, if barriers to increased deployment continue in local communities.  These persistent obstacles include high pole attachment fees and a lengthy application process for permitting. 

On August 18, 2021, the North Carolina Cable Telecommunications Association (NCCTA) released a report detailing the economic benefits of deploying broadband to local communities and the adverse effect of high pole attachment rates. The report noted that the success of federal efforts to provide additional taxpayer funding to deploy broadband, which could provide “an estimated $3.5 billion in new economic gains to the state’s businesses and households,” will require “efficient, unimpeded attachment of broadband wires to existing utility pole networks.”  NCCTA also found that, “current policies allow municipal and cooperative (‘Muni and Coop’) electric pole owners to exercise significant market power over pole attachment rates and terms, including onerous timetables and permitting fees, various pre- and post-construction requirements, and full pole replacement as part of the ‘make-ready’ process that occurs on the front end of pole attachment.”

If communities hope to expand broadband deployment efficiently and at a reasonable cost, they should ensure that companies seeking to build infrastructure are allowed to access poles without being forced to pay onerous fees or pick up the entire cost to replace poles that are used by more than just the broadband provider.  According to the NCCTA report, the delays caused by these “inefficient charges and practices” could create an estimated “deadweight loss” statewide of between $14 to $16 million monthly, or up to $186 million per year.

Problems with high pole attachment fees have existed for many years.  On June 9, 2017, Citizens Against Government Waste (CAGW) filed comments with the Federal Communications Commission (FCC), which discussed problems for companies trying to access municipally-owned poles as part of building broadband networks in local communities.  As CAGW noted, “Congress excluded such poles from Section 224 when it adopted the Pole Attachment Act in 1978 for reasons very specific to that time and place.   Congress was concerned about the deployment of cable systems, which it considered to be a local issue, and presumed that the managers of such entities would be responsive to the needs of the community.”  CAGW further noted that, “some providers reported rates for municipally-owned poles at double or even triple the rates they pay for access to other poles.”

On September 2, 2020, CAGW submitted comments to the FCC on the Petition for Expedited Declaratory Ruling by NCTA in the matter of Accelerating Wireline Broadband Deployment by Removing Barriers to Infrastructure Investment (WC Docket No. 17-84).  CAGW strongly urged “the FCC to work with pole owners, state regulators, and broadband providers to expedite the attachment application process so that rural broadband deployment is not unduly delayed due to bureaucratic red tape.”  The comments also asked the FCC to “approve the NCTA petition to have the specific cost of pole replacement shared between the new attacher and the pole owner when a pole is determined to be near the end of its useful life and would need to be replaced by the pole owner regardless of any new attachment. “

The NCCTA report is the latest in a series of reports that demonstrate the serious adverse consequences of impeding and delaying broadband deployment.  The intent of the bipartisan infrastructure bill and prior federal funding efforts make it clear that Congress wants to deploy broadband to underserved and unserved areas of the country as quickly and effectively as possible.  While CAGW has expressed serious concerns over the necessity of providing such a large amount of money, if it is going to be spent, state and local officials must assess the economic impact of high pole attachment rates and delayed applications on their state and local communities like the NCCTA has done, and make sure these restrictions are eliminated.

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