State Legislative Challenges to Community Broadband Wisconsin Act 278 sets up barriers to entry David J. Benforado, Executive Director Municipal Electric Utilities of Wisconsin (608) APPA National Conference June 21, 2004

2004 APPA National Conference Seattle, Washington June 21, 2004 Intro/Background of Muni Telecom in Wisconsin 1999 first Muni CLECs approved May 1, 2004 – 29 total; four non public power communities Incumbent-led legislation Senate Bill 272/Assembly Bill 588 marked the 11 th and 12 th attempts to limit, inhibit or prohibit muni telecom in Wisconsin

2004 APPA National Conference Seattle, Washington June 21, Legislative Session In February 2003, Senate Bill 54/Assembly Bill 110 introduced by Republican sponsors Third attempt at such legislation (99-00; 01-02) The legislation was intended to limit a municipal cable television system’s financing options Bill passed Senate committee, but not scheduled for a full Senate vote as (SB 272) follow on legislation would replace it

2004 APPA National Conference Seattle, Washington June 21, Legislative Session – cont’d Senate Bill 272 introduced on October 9, 2003 Sent to Committee on Transportation and Information Infrastructure; rather than the Energy and Utilities Committee Passed Senate on November 13 (23-9) Passed full Assembly on March 9, 2004 (voice vote) Signed into law on April 16, 2004

2004 APPA National Conference Seattle, Washington June 21, 2004 Senate Bill 272 (Wisconsin Act 278) Three components, four amendments  Cable system financing non subscriber money not allowed  Ordinance requirements: If a community wishes to create a telecom ordinance authorizing a telecom utility, they must have a public hearing and open the business plan for 30 days prior to the hearing, and publish notice of the hearing.

2004 APPA National Conference Seattle, Washington June 21, 2004 Senate Bill 272 (Wisconsin Act 278) (cont’d)  Total System Long Run Incremental Cost calculations (TSLRIC) Four amendments: A community is exempt from the provisions of the statute (under certain conditions) if:  CLEC granted prior to 11/1/03; AND the telecom project is subjected to an advisory referendum within the community

2004 APPA National Conference Seattle, Washington June 21, 2004 Senate Bill 272 (Wisconsin Act 278) (cont’d)  Community submits request for service to incumbent cable television and telephone providers and are turned down (unable to or refuse to serve area within 9 months)  A community may own and operate a wholesale services network if area is currently served by less than two providers  Your community is currently operating a cable television system (only two in Wisconsin)

2004 APPA National Conference Seattle, Washington June 21, 2004 Incumbent tactics/strategies Capitalized on make up of Legislature; sentiment of “beat up on local gov’t” “Bipartisan” support for bills Bill was not “outright prohibition,” rather it is “just to level the playing field.” Business group support Soft pedal Bill written to limit financing methods of municipal networks

2004 APPA National Conference Seattle, Washington June 21, 2004 Our Response Municipal groups support MEUW on issue (Municipal Telecom Consortium) Grass roots stories to individual Legislators Public hearing attendance Editorial boards

2004 APPA National Conference Seattle, Washington June 21, 2004 Lessons Learned Need to increase level of awareness sooner and continually Reach out to unlikely groups for support Members must be energized and passionate, which means YOU must be energized and passionate You will not win the philosophical debate

2004 APPA National Conference Seattle, Washington June 21, 2004 Lessons Learned Have sound legal counsel (Anita Gallucci, Boardman Law Firm) Lean on regional and national support (Jim Baller, APPA, Fiber to the Home Council) Expect to be outmanned, outgunned, out- financed, and deceived Don’t be fooled – there is a tremendous amount of money at stake

2004 APPA National Conference Seattle, Washington June 21, 2004 Never, never, never give up April letter from APPA President Alan Richardson – appeal for help with federal telecom re-write If we, public power communities do NOT stand up, together, speaking for the consumer, who will?

2004 APPA National Conference Seattle, Washington June 21, 2004 Remember… “The legitimate object of government, is to do for a community of people whatever they need to have done but cannot do, at all, or cannot so well do, for themselves – in their separate and individual capacities.” --Abraham Lincoln, 1852