Virginia May Nix Muni Broadband Curbs, Under Democratic Trifecta

Democrats won a political trifecta. They took a 21-19 majority in the Senate and a 55-45 majority in the House; the single-term limited Gov. Ralph Northam also is a member of that party. Levine told us his public broadband bill “had no chance prior to the Democratic takeover” of the legislative chambers. Now, it has “a real good shot” with the GOP in the minority, he added. “Democrats are the party of the free market and Republicans are the party of monopoly interests.”

Virginia Democrats are filing a flurry of bills on issues that would have been tough to pass under Republican rule. Levine said he’s introducing more than 40 progressive bills and isn’t putting all his eggs in one basket. “The change in the legislature has brought hope that we can put forward a progressive symbol like HB-1052,” said Detta Kissel, member of Our Revolution Arlington, which worked with Levine on his bill. “We’re hoping that this rises to the top, but we realize there’s a large pent-up demand for progressive legislation.”

The state doesn’t completely ban municipal broadband now, but public broadband supporters cited several hurdles. Levine’s bill would remove rules banning cross-subsidization, requiring feasibility studies, stopping a locality from charging less than incumbents, and limiting which localities qualify by population and whether they provide electric utility service. “Provisions in the current law that would require localities to charge at least as much as the incumbents charge today are anticompetitive and need to be removed,” said Kissel.

“The legal barriers are so high, they have the effect of prohibition,” Levine said. For example, “you have to make so much money in so much time,” which isn’t realistic for a broadband business, he said. “This is about competition,” said the Democrat, saying his only choice in Alexandria is Comcast, and that city wants to offer service. The bill protects private ISPs’ ability to compete, he said, and if they can’t, “that’s their problem.” Levine doesn’t see why his caucus or Northam wouldn’t support the measure. Northam didn’t comment Thursday.

The Virginia Senate Republican Caucus won't comment before the muni broadband bills "come before the Senate as a whole or a committee on which the Republican Leader [Tommy Norment] serves," a spokesperson emailed Thursday. House Minority Leader Todd Gilbert (R) didn't comment.

Industry Concern

The telecom industry disagrees with some types of muni broadband. ISPs have backed public-private partnerships. “The best way for municipalities to increase deployment, close the digital divide and best serve their communities is by lowering the barriers to private sector deployment,” emailed a USTelecom spokesperson. Verizon declined to comment. State cable group Broadband Association of Virginia didn’t comment.

Virginia muni internet-service providers operate under current law, said CEO Frank Smith of the Roanoke Valley Broadband Authority. RVBA is a regional fiber internet partnership including Roanoke and Botetourt counties and the cities of Salem and Roanoke. “We’re not restricted,” Smith said. The authority has business customers and doesn’t directly sell residential service, but it could in the future, he said. Muni broadband entities have needed to be vigilant of attacks on their authority, Smith said.

A 2017 bill by Del. Kathy Byron (R) was a potential “death star” for government broadband that backfired on industry backers and ended up bringing more positive attention to public broadband providers, Smith said. Sometimes, anti-muni language gets slipped into budget and grant language, for example by requiring funding applicants to be nongovernmental, he said. Byron didn’t comment.

“It’s a new day in the General Assembly,” with many good broadband bills coming from both sides of the aisle that “eliminate artificial swim lanes” and recognize local governments’ role, said Smith. Virginia lawmakers introduced many other broadband bills since the 2020 session opened last week, including on state funding, tax exemptions, and utilities and easements rules.

"If we can change the politics of the statehouse,” advocates can get some state restrictions rescinded, said industry analyst and local broadband supporter Craig Settles. Incumbent telecom companies seem to have a lock on Republicans in statehouses, where they have an easier time controlling policy than at the local level, he said. If local-government broadband supporters can take advantage of the Democratic majority and cut restrictions, it should be easier to fight off future attempts to restrict the practice, Settles said: “If you just clean the books entirely, you make it more difficult to bring an onerous bill.”

The three muni broadband bills would remove most Virginia barriers to community broadband and public-private broadband partnerships, emailed local-government law firm Baller Stokes’ Jim Baller. They “reflect the growing realization across America that localities can play a critical role in accelerating the deployment, adoption, and use of advanced communications capabilities and that state barriers to their participation in broadband initiatives are bad.”