The Governor’s Broadband Plan, Ad Valorem Action And Google Fiber

Posted: February 7, 2017

The Governor’s Broadband Plan

Even before Gov. Bill Haslam took time out of his State of the State address to discuss rural broadband, the TTA legislative team was expecting significant legislation on the topic.

“We’ve talked about infrastructure with regards to transportation, but having the right infrastructure to handle Tennessee’s potential growth also means talking about access to broadband,” the governor said in his annual address. “We live in a world where if you have a strong internet connection, you can just about work from anywhere. If we’re serious about putting our rural counties on a level playing field, then opening up broadband access is one of the largest steps forward we can take.”

TTA Executive Director Levoy Knowles says the administration’s plan is encouraging but imperfect. “The governor has great intentions, and that’s to be commended,” Knowles said. “How he gets there is always debatable.”

The plan, dubbed the “The Tennessee Broadband Accessibility Act,” would provide $45 million in incentives for providers to expand broadband to unserved Tennesseans. The funding is broken up into incentive grants available to any provider and tax incentives that encourage electric cooperatives to buy equipment. The governor also pledged to focus on digital literacy so Tennesseans can maximize the benefits of broadband. “Accessibility without adoption doesn’t accomplish very much,” he said in the address.

Knowles said TTA fully supports connecting unserved Tennesseans and appreciates the governor’s thoughts on digital literacy. TTA members will also likely be pleased that the act does not allow for municipal electric providers to expand broadband using unfair advantages with taxpayer backing.

“While I’m encouraged by Gov. Haslam’s plan, TTA members would like to see more guardrails in place so the objectives are accomplished without hurting members,” Knowles said. “In the best-case scenario, this should create some exciting partnership opportunities between electric cooperatives and TTA members. We’re working to be sure that all of the parties involved understand that no one knows more about providing broadband to rural Tennesseans than TTA members.”
Reaction to the plan:

The Tennessean: Gov. Haslam broadband plan offers $45M in grants, incentives
Chattanooga Times Free Press: Haslam snubs EPB with broadband expansion plan that won’t include city-owned utilities
The Commercial Appeal: Haslam on target with broadband push
Nashville Post: Haslam pushing for broadband expansion

Ad valorem bill progressing

For years, the TTA lobbying team has made the case for rolling back antiquated ad valorem tax rules that put most TTA members at a disadvantage against cable companies and other providers. TTA members still pay ad valorem tax based on 55 percent of their assessed value of assets, a number that was set decades ago when phone companies were monopolies in their service areas. But as cable companies and other providers entered the broadband market, those companies were taxed at 40 percent of the assessed value of their assets. This year, a bill would seek to reconcile that difference. At the time of publication, the bill does not have a number, but it is being sponsored in the Senate by Sen. Paul Bailey, R-Sparta, and in the House by Charles Sargent, R-Franklin.

Google Fiber in Nashville

In other news, The Nashville Business Journal has the latest on Google Fiber in Nashville. According to the report, it appears that two years after committing to build fiber in the Music City, Google has attached its fiber lines to 44 poles out the of the 88,000 poles they initially expected.