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Action Alert: Stop Sen. Hoyle’s Anti-Municipal Broadband Bill in North Carolina

A retiring state senator wants to throw North Carolina consumers under the bus with new legislation that could cost residents millions in savings on their cable, telephone, and broadband bills.

Senator David Hoyle (D-Gaston), has introduced S1209 — what Hoyle calls “The Nonvoted Local Debt for Competing System Act.”  We call it “The Anti-Consumer Muni-Killer Act,” representing little more than a lavish parting gift to telecommunications companies that have supported Hoyle for years.

As we have been reporting here, here, here and here for the past few months, the telecom industry has pulled out all the stops looking for friends in the state legislature to do their bidding.  This year, the industry is following the game plan it has used successfully in other states to kill potential community-based competition for their broadband duopoly.

The state’s cable and phone companies (and their legislator lackeys) argue that taxpayers should not be on the hook for municipally-owned networks.  In the guise of “protecting consumers,” Hoyle and his bill’s co-sponsors would compel municipalities to fund municipal broadband projects with General Obligation B0nds — a regulatory minefield that includes referendums held at taxpayers’ expense and direct taxpayer involvement in the funding process.

As we’ve discussed earlier, Hoyle’s proposal would compel endless referendums for everything from system construction and financing to basic system upgrades and repairs.  The implications of such legislation:

  • It makes municipal broadband projects untenable. What local government would consider a municipal project that would require endless referendums?  The only thing Hoyle didn’t include in his bill was a mandatory public referendum about where the engineers should order lunch.
  • Someone has to pay for the referendum process — North Carolina taxpayers.  So much for protecting the taxpayer!
  • The legislative minefield Hoyle lays for local communities is tailor-made for well-financed telecom industry opposition campaigns that are designed to demagogue municipal competition while tying the hands of communities to fight back.

The irony is, the current system already in place in North Carolina protects state taxpayers.

Both proposed and operational municipal broadband systems rely on Revenue Bonds that have to be approved by the North Carolina Local Government Commission.  These Revenue Bonds are not taxpayer-funded, and local residents are not on the hook should something go wrong.  The financing agreements with investors are designed to pay off the costs of such systems over time and they then become self-supporting.  But even from day one, municipal broadband represents an asset to a community’s efforts to attract digital economy jobs.

They also save you money.  Just ask the residents of Wilson, who didn’t face a rate increase outpacing inflation and finally had an alternative for “good enough for you” broadband from current providers.

Unfortunately, the current system is no good for Senator Hoyle because it doesn’t protect his friends in the phone, cable, and broadband industry, threatened with competition that would derail their duopoly gravy trains for good.

Hoyle should be willing to admit as such, considering his friends in the cable industry already have.  Marcus Trahen, a lobbyist for the North Carolina Cable Telecommunications Association told legislators at a Revenue Laws Study Committee meeting, “We don’t care if cities have internal systems; what we are worried about is competition.”

Under the guise of “protecting” taxpayers, Hoyle only manages to guarantee fat profits for Time Warner Cable, AT&T, and CenturyLink (formerly Embarq) without better pricing and service for you.  Perhaps Hoyle forgot North Carolina is ranked 41st out of 50 states for its comparatively-mediocre broadband services, mostly provided by those three companies.

Hoyle also argues that publicly owned systems harm private industry, despite the fact many in private industry support municipal broadband.  Several letters of opposition to S1209 have been sent to legislators from companies like Google, Intel, Alcatel-Lucent, and five private provider trade associations.

Hoyle doesn’t plan to stick around and watch the damage his proposed bill would create for North Carolina’s economic and high tech future.  After he retires from public office, his bill would leave a legacy of tied hands among local communities from Asheville to Greenville, and all points in-between.  Doesn’t your community deserve a better option?  If you want a third option that could dramatically lower prices and offer better service, shouldn’t local officials have the right to offer it if current providers won’t?

The fact is, none of these municipal projects would even be proposed if the cable and phone companies delivered the service communities want at fair prices. Cable and phone companies don’t need to spend hundreds of thousands of dollars to defeat these projects — they could simply lower their prices and offer the kind of service consumers demand.

For Hoyle’s part, he’s shocked…  shocked to discover consumers are offended by his telecom-friendly attitudes.  He told Indy Weekly, “the lobbyists don’t influence me; I’m in the pocket of the people that provide jobs for this state, and Time Warner Cable employs 8,500 — I can’t imagine anyone that would want to compete with that.”

Senator Hoyle weighed the interests of Time Warner Cable against 9.4 million North Carolina consumers and sided with the cable company.

Let’s push the scale in the other direction.

What You Need to Know

The author of S1209 is  Sen. David Hoyle (D-Gaston).

The bill currently lists five co-sponsors:

  • Sen. Peter S. Brunstetter (R-Forsyth)
  • Sen. Clark Jenkins (D-Edgecombe/Martin/Pitt)
  • Sen. Jerry W. Tillman (R-Montgomery/Randolph)
  • Sen. Dan Blue (D-Wake)
  • Sen. Fletcher Hartsell (R-Cabarrus/Iredell)

The latter two, Sens. Blue and Hartsell were formerly on our supporters list, and we’re reaching out for clarification as to why they are listed as co-sponsors on this bill.  We’ll update our readers about whether they will stand with North Carolina consumers or the telecom industry as soon as we hear back from their offices.

Your Action Alert

You must immediately contact legislators on the Senate Finance Committee, set to consider Hoyle’s bill this week, most likely on Wednesday.  But don’t wait until then.  You should be making contact today, just in case the bill gets voted on earlier, before opposition has a chance to build.

Tell the senators to oppose S1209 for the benefit of North Carolina’s economic future:

  • Make it clear voting for this bill is just another way to stop municipal broadband from delivering the kind of broadband service North Carolina wants and needs to grow its economy.
  • S1209 was custom-crafted to protect the interests of incumbent phone and cable companies, not North Carolina consumers.
  • The current system already protects taxpayers because they are not paying for municipal broadband projects.  S1209 forces local governments to spend taxpayer funds on endless referendums.
  • Explain you are already empowered to stop unwanted municipal projects through organized vocal opposition at town meetings as well as at the ballot box.  But your town would not be empowered to offer services private providers refuse if S1209 becomes law, because the legislation forces such projects into miles of red tape.
  • Worst of all, S1209 gives phone and cable companies plenty of time to demagogue such projects, spending ratepayer funds in a hopelessly mismatched fight.
  • Let them know you see through S1209’s anti-competitive intent, and you’re prepared to vote for those who stand up for North Carolina consumers and oppose these types of telecom industry-friendly bills.

Important! When writing, -DO NOT- simply carbon copy everyone on a single e-mail message.  Those mass mailings are discarded, unread.  For maximum effectiveness, send an individual e-mail to each legislator and another to their legislative assistant. Calling the legislator’s office can be even more effective and immediate.

Here is the list:

County First Name Last Name Tel (919) Party Email Address Leg Asst email
Alamance Anthony E. Foriest 301-1446 Dem [email protected] [email protected]
Buncombe Martin L. Nesbitt 715-3001 Dem [email protected] [email protected]
Cabarrus Fletcher L. Hartsell 733-7223 Rep [email protected] [email protected]
Carteret Jean R. Preston 733-5706 Rep [email protected] [email protected]
Catawba Austin M. Allran 733-5876 Rep [email protected] [email protected]
Chatham Robert Atwater 715-3036 Dem [email protected] [email protected]
Cherokee John J. Snow 733-5875 Dem [email protected] [email protected]
Columbus R. C. Soles 733-5963 Dem [email protected] [email protected]
Cumberland Margaret H. Dickson 733-5776 Dem [email protected] [email protected]
Cumberland Larry Shaw 733-9349 Dem [email protected] [email protected]
Davie Andrew C. Brock 715-0690 Rep [email protected] [email protected]
Duplin Charles W. Albertson 733-5705 Dem [email protected] [email protected]
Durham Floyd B. McKissick 733-4599 Dem [email protected] [email protected]
Edgecombe S. Clark Jenkins 715-3040 Dem [email protected] [email protected]
Forsyth Linda Garrou 733-5620 Dem [email protected] [email protected]
Gaston David W. Hoyle 733-5734 Dem [email protected] [email protected]
Haywood Joe Sam Queen 733-3460 Dem [email protected] [email protected]
Henderson Tom M. Apodaca 733-5745 Rep [email protected] [email protected]
Johnston David Rouzer 733-5748 Rep [email protected] [email protected]
Mecklenburg Daniel G. Clodfelter 715-8331 Dem [email protected] [email protected]
Mecklenburg Charlie Smith Dannelly 733-5955 Dem [email protected] [email protected]
Mecklenburg Bob Rucho 733-5655 Rep [email protected] [email protected]
Moore Harris Blake 733-4809 Rep [email protected] [email protected]
Nash A. B. Swindell 715-3030 Dem [email protected] [email protected]
New Hanover Julia Boseman 715-2525 Dem [email protected] [email protected]
Onslow Harry Brown 715-3034 Rep [email protected] [email protected]
Orange Eleanor Kinnaird 733-5804 Dem [email protected] [email protected]
Randolph Jerry W. Tillman 733-5870 Rep [email protected] [email protected]
Robeson Michael P. Walters 733-5651 Dem [email protected] [email protected]
Rockingham Philip Edward Berger 733-5708 Rep [email protected] [email protected]
Scotland William R. Purcell 733-5953 Dem [email protected] [email protected]
Surry Don W. East 733-5743 Rep [email protected] [email protected]
Union W. Edward Goodall 733-7659 Rep [email protected] [email protected]
Wake Daniel T. Blue 733-5752 Dem [email protected] [email protected]
Wake Neal Hunt 733-5850 Rep [email protected] [email protected]
Wake Joshua H. Stein 715-6400 Dem [email protected] [email protected]
Wake Richard Y. Stevens 733-5653 Rep [email protected] [email protected]
Watauga Steve Goss 733-5742 Dem [email protected] [email protected]
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Becky Carlson
13 years ago

Thanks so much for this helpful and informative “Call to Action” against S1209! As an internet business owner that lives in Wake County this could have a large impact. I am going to continue getting the word out but thank you for giving us the means.

Phillip Dampier
13 years ago
Reply to  Becky Carlson

Thanks for the comments, Becky. Even though I’m up in Rochester, NY I am a big believer in muni-broadband as an option for consumers and small businesses that, especially these days, need every break they can get. We already consider the Triangle and Triad sister regions to western New York — considering most of the people leaving here are moving there!

Fiber optic broadband is the future. The only question is how long will incumbent providers drag their feet before offering it. Communities should not have to wait around to find out.

Beverly Jones
Beverly Jones
13 years ago
Reply to  Becky Carlson

Finally the News & Record had the first article concerning this debatable in today’s paper. I’m completely disgusted with how little press this issue is getting. I have a T- shirt idea…—- Stops the Broadband Monopoly in NC TWC= Tierney Wins, Contempt
Contempt has several appropriate meanings here: Feeling of being despised…. – A law showing disrespect for the dignity of a court or legislature. I will continue to write the appropriate people. I hope others, who care about the future of our state will do the same!

Becky Carlson
13 years ago

That fact that you care about the Triangle area when you are not here makes your efforts even more special. I couldn’t AGREE MORE that Fiber optics is the future! An online business is the one of the best things we have ever done and the Bluemoonistic Images team support all your efforts and hope we can help get the message out!

13 years ago

Time Warner’s S1209 is trying to place the financial burden of these systems directly on the taxpayers, when to date that is not the case. Current NC municipal bbnd providers in the state are using COPS financing (Certificates of Participation), where the system itself is used for the collateral on the debt. That means, in worse case scenario, if the system were to fail (not expected), the community could always sell the system to pay the debt. TWC wants to flip that and make the taxpayer directly liable for the debt by limiting the financing of these systems only to… Read more »

Phillip Dampier
13 years ago
Reply to  katyB

Time Warner loves to whine about taxpayer money funding their competitors, but is strangely silent when they cash in on state taxpayer money themselves through economic stimulus grants, tax credits, and other goodies.

They constantly argue these kinds of projects are risky and dangerous for taxpayers and are destined to fail, yet they are terrified of letting them get established.

It doesn’t add up.

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