A state lawmaker in Michigan wants to prevent cities and towns from using any government funding to provide Internet service. Michigan Rep. Michele Hoitenga, a Republican from Manton, last week submitted a bill that says cities and towns "shall not use any federal, state, or local funds or loans to pay for the cost of providing qualified Internet service."

Hoitenga is the chair of the Michigan House's Communications and Technology committee, which will consider the bill.

About 20 states, including Michigan, already have laws restricting municipal broadband in some way, effectively shielding private broadband providers from competition even as many residents lack robust broadband options. But while these states generally let cities and towns offer Internet service if they meet certain criteria, the Hoitenga bill doesn't give local governments much leeway.

Hoitenga's bill does say that a city or town "may enter into an agreement with one or more private parties to provide qualified Internet service," as long as no government funds are used.

Even with that exception, the bill could discourage cities and towns from pursuing public-private partnerships, according to an analysis by the Institute for Local Self-Reliance's Community Broadband Networks project:

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.

Hoitenga's bill defines "qualified Internet service" as anything with speeds "of at least 10Mbps upstream and 1Mbps downstream." That may be a typo in the bill, since Internet services generally have higher downstream speeds than upstream. But it seems that a city or town could theoretically offer only very slow Internet service in order to avoid violating the proposed law.

When asked about this on Twitter, Hoitenga said she would have to "speak with the attorneys who wrote the bill" to determine whether the listed speed was a mistake. "I will speak with the attorneys who wrote the bill. They changed the language I submitted but will ask why they changed it," Hoitenga wrote. (She later set her Twitter account to private, hiding her tweets from the public.)

The bill doesn't provide an exception for existing projects, though it could be amended later.

"What HB 5099 is really about is the continuation of a war on broadband competition by CenturyLink, AT&T, and Charter Spectrum," Community Broadband Networks said in a press release. Because Hoitenga chairs the Communications and Technology Committee, "this bill is not likely to die the quick death it deserves."

Rep says she’s helping taxpayers

The government in Holland, Michigan, recently decided to offer fiber Internet service and let any ISP offer service over the municipal network by buying wholesale access. Hoitenga appears to be motivated partly by that project—even though Holland is outside her district.

When questioned on Twitter, Hoitenga wrote that "When a municipality has 37 providers in their area and use taxpayer $ to run their own broadband companies-taxpayers are thanking me."

Hoitenga pointed to Broadband Now, a database that lists a few dozen Internet providers in Holland. But that site double-counts ISPs that offer both residential and business Internet service. The site also lists only three residential ISPs covering more than half the town, and two of those offer DSL instead of a modern technology like cable or fiber.

In places where broadband is lacking, Hoitenga wrote that taxpayers should be able to vote on whether to offer Internet service.

We pointed out to Hoitenga that her bill makes no mention of letting cities or towns vote. There are "amendments coming," she replied. "This bill was presented to get the much needed conversation going. I'm a proponent of [broadband] expansion."

We also e-mailed Hoitenga with more extensive questions yesterday but didn't receive an answer.

"Rep. Hoitenga seems to believe we have 37 ISPs serving the City," a local Holland group wrote. "Anyone who lives here knows we effectively have two: Comcast and AT&T. Neither provide gigabit fiber to residents, and where they can offer fiber, it is not affordable. BPW’s [Board of Public Works] gigabit fiber will be 10x faster than these providers at a lower price. Plus, BPW is building an open-access system that other ISPs can use."

Michigan’s existing restrictions

Existing Michigan law already requires municipalities to seek bids before providing telecom services, and they can move forward only if they receive fewer than three qualified bids from private entities.

"If a local community then goes on to build a publicly owned network, they must comply with the terms of the RFP [request for proposals], even though terms for a private sector vendor may not be ideal for a public entity," the Community Broadband Networks article said. "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."