Hartford Business Journal

14 Hartford Business Journal • May 21, 2018 • www.HartfordBusiness.com By Matt Pilon mpilon@HartfordBusiness.com I t's been a tough slog for cities and towns that want to build ul- tra-fast fiber internet networks to benefit residents, businesses and their local economies — so tough, in fact, that virtually none has managed to do it. This month, a ruling by the Public Utilities Regulatory Authority further diminished their odds. PURA's May 9 decision, which may end up in state court, blocks municipali- ties from using their legally reserved space on utility poles to build fiber networks that offer broadband internet service to residents and businesses, including through contracts with third- party developers. The reserved pole space, called "mu- nicipal gain," has been enshrined in state law since the early 1900s. PURA's decision limits communities' use of pole space to local governmen- tal activities like building networks for schools and other public buildings. The ruling takes away what was once seen as the most economical and realistic avenue to forming municipal broadband networks in Connecticut, imperiling the hopes of communities desiring more affordable, gigabit- speed internet to spur economic growth, attract younger workers and close the "digital divide" for lower- income residents. "We are very disappointed in the decision," said Consumer Counsel Elin Katz, a chief proponent of municipal broadband efforts. "It ignores the plain language of the statute, and by deciding that [municipal gain] cannot be used by our cities and towns to provide broad- band to those affected by the Digital Divide, denies our municipalities a tool provided by the legislature for just that purpose." The decision likely delays plans for a multi-town fiber network in northwestern Connecticut, where faster speeds are less ac- cessible. Officials there are soliciting network develop- ers and hoped this year to seek local participation approvals from about 25 area communities. "This is a complication, a serious complica- tion," said Kim Maxwell, presi- dent of Northwest Connect, the partnership that's been pursuing the estimated $100 million project since 2015. "PURA is denying us ac- cess to the future." Manchester and West Hartford have also been talking to potential broad- band partners for the past few years. Manchester hopes to build out a network with speeds as high as 10 gigabits-per-second for two key com- mercial corridors. The town's Chief In- formation Officer Jack McCoy said he continues to work on a technical plan for the expansion, but acknowl- edged that PURA has just removed one of few avail- able options. With above- average affluence and population density, West Hartford has seen telecoms and oth- er competitors build out faster service within its borders, but Mayor Shari Can- tor said not all neighborhoods are adequately covered. The town wants to keep its options open in the com- ing years, as the needs of resi- dents, businesses and students shift. "We're open to ideas and maybe having a relationship with companies that might offer afford- able broadband to our residents," said Cantor, who has called telecom op- position to municipal broadband an effort to insulate the industry from competition. Incumbents rejoice While broadband advocates are decrying PURA's recent ruling, the telecom industry is heralding it. Frontier, which owns utility poles across the state, said the final decision was "fully consistent with the law." "Frontier Communications continues to support efforts to expand broadband access in Connecticut," said spokes- man Andy Malinowski. "PURA reached the correct result. This decision helps ensure the continuation of robust broadband competition in our state." Other petitioners included the New England Cable & Telecommunications Association (NECTA), wireless com- munications industry group CTIA, and the Communication Workers of America, which represents a large number of Frontier workers. NECTA CEO Paul Cianelli said, "Our members, who pay millions of dollars annually to rent space on utility poles, offer competitive broadband services with speeds ranging up to 1 gigabit- per-second for residential Connecticut customers, in addition to offering speeds up to 10 gigabits for business customers." Unless a court overturns PURA's decision, or the legislature steps in to clarify state law, it could be a death blow for municipal broadband efforts that have been underway for much of the past decade, backed by the state's Office of Consumer Counsel and mu- nicipal leaders, but opposed strongly by major internet providers as an unfair, anti-competitive and govern- ment-subsidized encroachment. OCC Principal Attorney Joseph Rosen- thal said the agency may appeal PURA's decision in state court. "We're seriously exploring it," Rosen- thal said. If that happens, there could be plenty of municipalities willing to join in. The Connecticut Conference of Municipalities, Connecticut Council of Small Towns, and more than two doz- en individual municipalities sought to intervene in the PURA proceeding. Many of them agreed with CCM's at- torneys, who wrote that PURA's March draft decision (which reached the same conclusion) "blatantly contorts and violates the plain meaning" of language put into state law in 2013 — namely, that municipalities could use their gain space "for any purpose." "We would intend to show in court that the statutory revision in 2013, by plain language, was intended to give the municipalities the opportunity to use the municipal gain for any pur- pose," Rosenthal said. Advocates hope the legislature will further clarify the intent of the state law allowing the use of municipal gain "for any purpose." That tweak came at the last minute in 2013, slipped into the state budget implementer bill, with no public hearing. State Sen. Beth Bye (D-West Hart- ford) wrote to PURA in January that she had played a central role in the re- vision, and insisted that the language is "direct and clear." "I worked to make sure it would Community concern In addition to the Connecticut Conference of Municipalities, the Connecticut Council of Small Towns and several regional councils of government, the following municipalities lobbied during PURA's seven-month municipal gain proceeding to preserve their ability to use utility poles to establish high- speed internet service for businesses and residents: Barkhamsted Beacon Falls Bethany Bloomfield Branford Cornwall Danbury Derby Guilford Madison Manchester Marlborough Monroe Montville New Britain Newington New Haven Plainville Sharon Wallingford West Hartford Weston Wethersfield Winchester Wolcott Woodbridge High-Speed Headaches Telecom industry books major win in municipal-broadband fight Utility regulators have struck a new blow to cities and towns hoping to build their own internet networks for businesses and residents. However, East Hartford continues to pursue its own network. Here, Mayor Marcia Leclerc holds a fiber cable at town hall. PHOTO | CONTRIBUTED

• Cover