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Taking the Field: For a 21st Century Economy, High-speed Broadband is a Necessity 

By Paul Meyer, NCLM Executive Director

In August, a U.S. appellate court issued a ruling that is almost certain to damage small cities and towns and their residents. The U.S. 6th Circuit Court of Appeals pretty much recognized that fact, but found that the Federal Communications Commission did not have the authority to preempt state laws that limited the expansion of municipal broadband systems. “We do not question the public benefits that the FCC identifies in permitting  municipalities to expand Gigabit Internet coverage,” the ruling concluded.

This federal court case came in response to an FCC ruling on behalf of the City of Wilson and the City of Chattanooga, Tenn., which both operate high-speed municipal broadband systems, preempting state laws. Both North Carolina and Tennessee sued to challenge that ruling.

In the aftermath of the court decision, the FCC announced that it would not appeal the case to the U.S. Supreme Court. So, it would appear that North Carolina municipalities are back to where they were prior to the FCC ruling, with the 2011 law passed by the General Assembly which severely restricted the expansion of community broadband back in force.

The League, of course, opposed that law, and had beaten back similar bills for four straight years until the measure finally passed. It was disappointing to see the federal appeals court undo the FCC ruling, which we had supported with public comments filed with the federal agency. But if the issue has been settled before the courts, there is no reason that has to be the case with the General Assembly.

As I said when the FCC issued its decision in February 2016, the discussion prompted by the case provides an opportunity for the General Assembly to re-evaluate its 2011 decision. In doing so, cities and the state can find some middle ground. After all, while the League will always support individual municipalities having the tools and decision-making authority required to address their vastly different challenges, the larger issue here is not who owns what.

The larger issue – which has become crystal clear as the FCC considered the Wilson petition, approved it, and the case then made its way before the courts – is that smaller cities and towns and rural areas of North Carolina will be left further behind economically without high-speed broadband, and market forces alone are unlikely to bring about a solution anytime soon. In many respects, the issue here is no different than the electrification of rural America in the 1930s and 1940s. The creation of the electric cooperatives that provided that electricity came about only because of a policy decision reached by Franklin Delano Roosevelt and Congress with the passage of the Rural Electrification Act of 1936.

High-speed Internet service is the equivalent today of electric service in 1930s and 1940s America. It is a utility service that is crucial if small towns and cities are to thrive and prosper economically. The 6th Circuit court decision noted that Wilson’s top seven employers are all customers of its Greenlight broadband network. The New York Times recently pointed to Wilson’s ability to attract a movie visual effects company, Exodus FX, which has worked on movies like “Captain America” and “Black Swan,” because of its Greenlight service. North Carolina legislators are right to be concerned about the solvency of municipalities and the protection of taxpayers – two factors that supporters of the 2011 law cited regarding that support. But those concerns won’t matter much if rural communities cannot access high-speed Internet service and, as a result, are left in the dust of an accelerating 21st century economy.