Torpedo legislation aimed at municipal network initiatives don’t usually appear in October, but Michigan’s year-round legislature is making 2017 atypical. Last week, Freshman Representative Michele Hoitenga from the rural village of Manton in Wexford County introduced a bill banning investment in municipal networks.
HB 5099 is short; it decrees that local communities cannot use federal, state, or their own funds to invest in even the slowest Internet infrastructure, if they choose to do it themselves:
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
SEC. 13B. (1) EXCEPT AS OTHERWISE PROVIDED IN SUBSECTION (2), A LOCAL UNIT SHALL NOT USE ANY FEDERAL, STATE, OR LOCAL FUNDS OR LOANS TO PAY FOR THE COST OF PROVIDING QUALIFIED INTERNET SERVICE. (2) A LOCAL UNIT MAY ENTER INTO AN AGREEMENT WITH 1 OR MORE PRIVATE PARTIES TO PROVIDE QUALIFIED INTERNET SERVICE. (3) AS USED IN THIS SECTION, “QUALIFIED INTERNET SERVICE” MEANS HIGH-SPEED INTERNET SERVICE AT A SPEED OF AT LEAST 10 MBPS UPSTREAM AND 1 MBPS DOWNSTREAM.
The exception allows local communities to engage in public-private partnerships, but the bill’s ambiguous language is likely to discourage local communities from pursuing such partnerships. As we’ve seen from partnerships that have successfully brought better connectivity to towns such as Westminster, Maryland, communities often took the initiative to invest in the infrastructure prior to establishing a partnership. Typically, the infrastructure attracts a private sector partner. If a community in Michigan wants to pursue a partnership that suits the exception of HB 5099, they will first have to grapple with the chicken and the egg dilemma.
Rather than put themselves at risk of running afoul of the law, prudent community leaders would probably choose to avoid pursuing any publicly owned infrastructure initiatives.
Munis Gaining Ground In Michigan
Michigan already has a significant state barrier in place; municipalities that wish to improve connectivity must first appeal to the private sector and can only invest in a network if they receive fewer than three qualifying bids. If a local community then goes on to build a publicly owned network, they must comply with the terms of the RFP, even though terms for a private sector vendor may not be ideal for a public entity.
Nevertheless, several communities in Michigan have dealt with the restrictions in recent years as a way to ameliorate poor connectivity. They’ve come to realize that their local economies and the livelihood of their towns depend on improving Internet access for businesses, institutions, and residents.