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Bill would bar Michigan communities from using public money for internet infrastrucure

Oct 17, 2017

Proposed legislation in Lansing would prevent local governments from using federal, state or local funds to invest in internet infrastructure unless the municipality already has a deal with a private company to provide the internet service.

Rep. Michele Hoitenga (R-Manton), introduced the bill last week. She said government should not be competing against the private sector, and she is particularly concerned about communities that already have private broadband providers.

"I feel strongly that this needs to either be stopped or it needs to, at least at the very minimum, go to the vote of the people within the area."

Hoitenga said she has heard from taxpayers who do not want to be taxed for local government to invest in internet connectivity.

She said some communities put up regulatory barriers that hinder the private sector from providing internet services, although she acknowledged that it is difficult for some rural communities to attract private investment in internet services without public support.

Critics of the bill say it would harm Michigan communities with inadequate internet access and hurt their economic development.

According to Christopher Mitchell, Director of the Community Broadband Networks Initiative with the Institute of Local Self Reliance, the bill would leave the businesses in underserved communities less competitive, hurt their children's education, and result in declining property values.

Mitchell said the bill is about private providers' fear of broadband competition and of local communities' providing faster and more reliable service at the same or lower prices.

"If they face any competition, then they're either going to have to lose those customers or invest significantly to keep them. So the big companies want to prevent that," said Mitchell. "The other concern, even in areas where they don't have customers, is the threat of a good example."

Hoitenga said she expects the bill to be substantially amended after hearings take place next week before the House Communications and Technology Committee, which she chairs. She said her goal is to improve internet access throughout Michigan, and she introduced this bill to spark a conversation.