Voters in 26 Colorado cities and towns, along with 17 counties, on Tuesday will be deciding whether to lift a decade-old law that prohibits their local governments from getting into the broadband Internet game.
By far, it’s the largest group of municipalities to take on the 2005 law, the aim of which was to ensure that private Internet providers weren’t forced to compete with government-funded data networks in providing high-speed Web service to homes and businesses.
The reasons vary for the ballot measures across the state. Some communities want to provide Wi-Fi in public buildings and parks while others have plans to partner with the private sector on building out a fiber-optic backbone.
Others, mostly rural and small cities, say their current broadband service is lousy and they want to improve it.
“It’s not that we want to compete with the private sector — it’s that the private sector isn’t providing the level of service the community needs,” said Ken Fellman, general counsel with the Colorado Communications and Utility Alliance.
Geoff Wilson, general counsel for the Colorado Municipal League, said his organization hears a “constant drumbeat” of complaints from cities and towns that their Internet service is unreliable and slow. As high-speed data connections have become increasingly crucial to luring high-paying jobs to Colorado, Wilson said the issue has become that much more critical to a community’s economic well-being.
“Broadband Internet is the streets, sewers and water lines of our time,” he said.
But Pete Kirchhof, executive vice president of the Colorado Telecommunications Association, said developing a broadband data network is not as simple as laying some fiber under ground and watching the gigabits pour in. He said the 2005 law, SB-152, “is working exactly how it is supposed to” in that it requires voter approval before a municipality embarks on a major broadband initiative.
“If government is going to be getting into this risky business, taxpayers ought to know about it and approve it,” said Kirchhof, whose organization represents more than two dozen rural independent phone companies in Colorado.
He points to the troubles faced by EAGLE-Net, the quasi-governmental entity that in 2010 secured $100.6 million in federal stimulus money to expand broadband coverage across Colorado, promising to connect every school district to its high-speed network. EAGLE-Net has been slammed for overbuilding and laying fiber-optic cables in communities that already have multiple networks.
And next door in Utah, a consortium of cities put together broadband provider UTOPIA, which has struggled with heavy debt, mismanagement and construction problems.
“You better know what you’re getting into because it’s very risky,” Kirchhof said.
He also points out that city-run broadband services can be inherently unfair in the marketplace, since governments don’t pay taxes, act in a regulatory capacity and control the rights-of-way in which fiber-optic cable is laid.
Most cities, however, don’t want to replace the private sector, Fellman said. Centennial, which exempted itself from SB-152 in 2013, is working with a consultancy, Magellan Advisors, to design a fiber-optic backbone for the city, which it would run in partnership with the private sector.
“I really think that most municipalities do not want to be broadband providers,” Fellman said. “But if you own your own fiber, you know how much capacity you have at any given time.”
In the past four years, 10 cities and towns — including Boulder, Cherry Hills Village, Red Cliff, Montrose and Wray — have voted to exempt themselves from the constraints of SB-152.
Longmont stands as the prime example of a city that went all in on municipal broadband. It failed in 2009 in its first attempt to defeat the state law at the ballot box, after it was heavily outspent by the industry, but managed to get out from under SB-152 during the 2011 election.
Two years ago, Longmont voters approved a $40.3 million bond issue to build out the city’s 17-mile fiber-optic loop within three years.
Tom Roiniotis, general manager of Longmont Power and Communications, said the city had grown tired of trying to make a deal with private Internet providers to light up broadband service in Longmont.
Comcast and CenturyLink base their investments on where they will get the greatest return for their shareholders, and not on the interests of a particular community, he said.
“Had they done it, we wouldn’t be having this conversation,” Roiniotis said.
Longmont has nearly 20 percent of the city covered by its NextLight gigabit Internet service, and Roiniotis thinks the entire city will be wired by the end of next year.
Earlier this year, speed testing company Ookla declared NextLight’s one gigabit per second the country’s fastest Internet service. Downloading a digital movie on gigabit speed takes less than two minutes.
“We’ve already had businesses tell us they are staying here — or relocating here — because of this service,” Roiniotis said.
Comcast announced last month that it would be bumping up speeds for most of its subscribers to a maximum of 150 megabits per second — more than six times slower than NextLight. Cindy Parsons, a Comcast spokeswoman, said gigabit speed Internet from Comcast is available but it is priced at $300 a month.
Longmont charges $50 a month.
But unlike Longmont, which has its own electric utility, most other municipalities in Colorado would be starting from a much different point.
Virgil Turner, director of innovation for Montrose, said residents in his city were feeling “pretty desperate” about the quality of their Internet service before the city voted to exempt itself from SB-152.
“We had businesses that were on the verge of leaving Montrose,” he said.
Since the election 18 months ago, Turner said the city has partnered with a private company to run high-speed fiber to a new co-working facility where the city has meeting space. It’s also looking to team up with a local electric cooperative to extend fiber to homes in Montrose.
“We didn’t know exactly what we’d do,” Turner said. “But we no longer are under this dark cloud of not being able to be innovative.”
John Aguilar: 303-954-1695, [email protected] or @abuvthefold
Cities and towns with broadband issue on ballot tuesday
Source: Colorado Municipal League