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Vermont Exposes the Lies of Broadband Maps Drawn With Broadband Industry Data

Phillip Dampier May 25, 2011 Broadband Speed, Public Policy & Gov't, Rural Broadband, Video, Wireless Broadband Comments Off on Vermont Exposes the Lies of Broadband Maps Drawn With Broadband Industry Data

Vermont officials this month are learning broadband maps purporting to represent widespread availability of high speed Internet access across the state are much less accurate than originally thought.  Now into its second week, the BroadbandVT project to identify service gaps and collect actual broadband speeds is showing a chasm between provider claims and actual broadband reality on the ground for the state’s 625,000 residents.

Vermont’s broadband service availability map was originally reliant on service providers voluntarily contributing data about where service was available — data that has rapidly found to be faulty as Vermont residents report their actual broadband experiences to the state’s website.

The state’s Broadband Mapping Team used data from a phone survey conducted in January by the University of Vermont-Center for Rural Studies to verify providers’ claims of broadband availability.  On May 12, state officials reported that their provider-inspired maps were not accurate, and officials wanted residents to help verify coverage.

“I’m bound and determined to have Vermont connected by 2013 — high-speed Internet and cell service to every last mile. One of our challenges is that we don’t have information that we can trust about who has service and who doesn’t,” Gov. Peter Shumlin said. “So we need Vermonter’s help, so we can figure out where to go. So we’re urging Vermonters to use our new website to help us get truth about your service in your home or business.”

In similar cases Stop the Cap! has followed, the biggest sources of inaccurate data turn out to be telephone companies and wireless providers.  Phone companies like FairPoint Communications may advertise DSL available in certain communities, but be unable to actually provide the service to every household due to the distance between the central telephone exchange and the customer’s home, or because of deteriorated infrastructure.  Wireless providers often theorize where service should be available, but real world experience proves otherwise.

FairPoint told the Brattleboro Reformer the phone company intends to do much better delivering DSL to Vermont residents in the coming weeks.  The company claims it already provides DSL access to 82 percent of the state and intends to increase that number considerably higher in June.

“We have a plan with the state to bring total broadband coverage to half of our telephone exchanges in the state, so that’s the first three digits of your phone number. Ninety-five percent of that will be done in the next six weeks,” said FairPoint spokeswoman Sabina Haskell.

Vermont residents appear to be enthusiastic participants in the project, with 1,500 visitors a day using the website’s broadband maps and taking speed tests to share results with the state, who can compare them against providers’ speed claims.

Vermont’s expansion of broadband service is a state priority, and directing resources to areas of need has proved critical as the state receives and spends broadband stimulus funding.  Crowdsourced maps can expose exaggerated claims of broadband availability or confirm them as accurate.  The state intends to update its maps regularly based on data it receives, all part of an initiative to deliver 100 percent broadband coverage across the state.

[flv width=”360″ height=”290″]http://www.phillipdampier.com/video/WPTZ Plattsburgh Lawmakers Debate Broadband 4-12-11.mp4[/flv]

WPTZ-TV in Plattsburgh explores Vermont’s new initiative to bring broadband to 100 percent of the state’s residents.  (2 minutes)

[flv width=”360″ height=”290″]http://www.phillipdampier.com/video/WPTZ Plattsburgh Website Identifies Broadband Availability 5-12-11.mp4[/flv]

WPTZ-TV also reports on the state’s new website to verify broadband mapping data and speed claims made by the state’s phone and cable companies.  (3 minutes)

West Virginia Upset With Current State of Broadband; Companies Losing Business Over Lack of Service

At least 41 percent of West Virginian economic development professionals responding in a new survey rate their area’s existing broadband service as “not very good,” a result that could have profound implications for high tech economic development in the state because of poor quality business broadband service.

Some of the results of the survey, conducted by Internet Service Provider Citynet:

  • 77% said government involvement in steering broadband policy was “very important.”
  • 78% believe modern, reasonably priced broadband Internet infrastructure is “extremely important” or “very important” in competing against other locations for jobs.
  • On a 10-point scale, broadband Internet infrastructure (8.56) rates as slightly more important than road improvements (8.26) and water infrastructure (8.26).

“Seventy-eight percent of respondents say it has been their experience that businesses considering locating in their areas place high priority on access to affordable, high-speed Internet when evaluating site selections,” said Jim Martin, president and chief executive officer of Citynet. “And 66 percent say cost and capacity of broadband service are factors more than half of the time when discussing new business prospects.”

Some participants in the survey said they are losing business prospects in part due to the lack of broadband capacity, its speed or cost. Most of the professionals said they were “very familiar” or “somewhat familiar” with broadband expansion programs, such as middle-mile infrastructure, being implemented in adjoining states.

In West Virginia, most broadband expansion is being done by “last-mile” service provider Frontier Communications, which took over most of the state’s landlines from Verizon.  For most homes and businesses outside of areas where cable companies compete, Frontier provides DSL broadband service ranging from 1-3Mbps in smaller communities, perhaps 7Mbps or slightly better in larger cities.

West Virginia has proved to be one of the least impressive states for broadband owing to its terrain and large number of rural communities, providing few incentives for robust competition.  That has meant slow speed service at high prices.

Survey respondents were less than impressed:

  • “I have a project pending [and] will probably lose it based on costs of broadband.”
  • “The lack of high speed service in the rural areas totally extinguishes the possibility of new small business start-ups.”
  • “Prospects don’t look here because of the lack of high speed, affordable, reliable broadband…. Current speeds of up to 3 mb while may be suitable for residential use are not suitable for business.”
  • “Not only do too many areas still not have broadband, but too many places where people live do not have it and that affects the quality of life issue when attracting a prospect to live, work and play in WV.”
  • “We were looking at a possible location of a data center and the lack of affordable, large capacity broadband was a deciding factor in them not locating in WV.”
  • “We need the middle-mile and trunk-line services in West Virginia to remain competitive for many of today’s industries. What good is it if we get high-speed to every place in West Virginia, when we can only reach each other and do not have the facilities to get out of the state and into the major lines?”
  • “[We] lost a company that looked at an existing building located in an area that doesn’t have high-speed access. They ended up locating in another area.”
  • “You are not in the game without it.”
  • “What are we waiting for?”

Citynet has a dog in this fight.  Martin has tangled with Frontier Communications in the past year over broadband stimulus funding and where taxpayer dollars are being spent in the state.  While Frontier has touted “fiber projects” in West Virginia, those are primarily directed at increasing capacity for Frontier’s middle-mile network between its telephone exchanges, in hopes of expanding DSL further out into rural areas.  The company is also trying to address congestion issues that have grown since buying out Verizon’s landline-based broadband business.

Martin has criticized state officials for supporting Frontier’s efforts because the company will end up owning and controlling the network built, in part, from taxpayer dollars.

Stop the Cap! hears regularly from ordinary consumers in the state who are dissatisfied with their broadband choices, especially when they come from just a single provider — Frontier.  Slow speeds, poor service, and repeated service outages have been documented here and by the state’s local media.  Some outages are attributable to Verizon’s poor quality infrastructure (now owned by Frontier), others to Frontier’s unwillingness to replace that infrastructure — instead choosing to repair it, even if further outages occur later.

Windstream Reports Increased Landline Losses, But Revenues Up from Acquisitions

Phillip Dampier February 22, 2011 Rural Broadband, Windstream 1 Comment

Windstream, one of America’s largest independent phone companies, has reported lower profits in the fourth quarter, declining four percent year-over-year to $72.4 million.  Windstream’s core business continues to decline — losing another 36,000 landline customers during the quarter, as Americans continue to drop traditional telephone service.

But Windstream’s ongoing acquisitions, as structured, are helping boost revenues on the company’s balance sheet.  Windstream completed four acquisitions in 2010: the phone companies Iowa Telecom, Nuvox and Q-Comm Corp, and a data center operator, Hosted Solutions.

Although boosted revenue numbers can temporarily improve a company’s share price, investors are unlikely to ignore Windstream’s ongoing decline in profits for much longer.  Windstream officials expect revenue growth for 2011 to remain flat, or potentially edge up by 3 percent. But part of that revenue growth comes from $40 million in broadband stimulus funding the company expects to receive from the Obama Administration during the year.

Windstream's 2009 announced purchase of Iowa Telecom expanded Windstream's reach.

Windstream has made inroads in expanding broadband service in its largely rural service areas.  The company added 12,000 broadband customers during the quarter, mostly for its DSL product.

Windstream’s results show a growing disparity between its residential customers and its business services unit.  While growth on the residential side has been flat to anemic at best, the company is finding better results from its business customers.  The decision to acquire a data center is part of the company’s growing strategy towards those clients.  Windstream plans to spend a considerable amount of its capital during 2011 on improving its data hosting and wireless backhaul product lines to service these customers.

“We’ve made great strides in our business channel, which now represents roughly half of Windstream’s total revenue and importantly, these revenues are growing,” said Brent Whittington, chief operating officer at Windstream.

Windstream’s acquisition plans for 2011 appear cooler than in previous years as it attempts to reduce its leveraged debt.  Most of Windstream’s growth has been attributed to its aggressive mergers and acquisitions strategy.  The company, created in 2006 from Alltel’s landline division and Valor Telecom has grown into a national player, serving nearly 3.4 million customers in 23 states.  Among its larger acquisitions — CT Communications (2007), D&E Communications (2009), and Iowa Telecom (2010).

Despite the lower profits, Windstream’s dividend payout ratio was 57 percent for the year, and the company expects to pay between 52 percent and 59 percent of earnings for 2011.

Frontier’s Press Releases Ignore Serious Service Problems Which Can Last for Weeks

Slaterville Springs is a hamlet in the town of Caroline, N.Y.

Frontier Communications issues press releases promoting the expansion of low speed DSL service into new areas, but for many existing customers, extended service outages ruin their broadband experience.

Just ask Stop the Cap! reader Paul from Slaterville Springs, just outside of Ithaca, N.Y.  Much of his hamlet was without Frontier’s DSL service for more than two weeks, leaving dozens of families with poor-to-non-existent access to broadband for the better part of January.

It Was Supposed to Be Restored in Two Days — But Three Weeks Was More Like It

“It was supposed to be restored in two days, but after repeated calls, they told me it was a “common cause” failure impacting a large number of subscribers,” Paul told us. “Later, we were told Frontier was waiting for parts to fix some equipment at the central office.”

Paul heard the same excuse a week later, as he and other local residents remained cut off from the Internet.

Paul has been underwhelmed by the attention Frontier has given to the town of Caroline, which includes Slaterville Springs.  He has complained to the town supervisor and the New York Public Service Commission.  Frontier has already offered him a refund for the extended interruption in service, but Paul would really like a stable Internet connection that performs well with today’s bandwidth-intensive Internet.

“Before the outage, I got about two-thirds of the promised 3Mbps speed from Frontier, which means any interactive applications can be difficult, and YouTube videos require lengthy buffering before one can watch,” Paul says.  “I think being able to watch YouTube without painful slowdowns should be a key metric for today’s broadband.”

At the end of January, Paul reached out to Ann Burr, Frontier’s regional president of operations.  She called up Claudia Maroney,  the general manager of Frontier’s Central New York division.

“I was told right away that I’d get a service credit for two months and that the problem would be dealt with quickly,” Paul said. “The technician in the central office contacted us and said the solution was to further reduce my speed, because he thought we were too far away from the central office to sustain even the slow speed we had before.”

That turned out not to solve the problem either.

Finally, Frontier brought Paul a new DSL modem which, in concert with repairs in the central office, finally resolved his problems.

Frontier claims it will also increase capacity in his area, which apparently also suffers from evening congestion.

Poor Internet service is not just limited to Caroline.  The entire Southern Tier region between Corning and Binghamton is hard-pressed to access high-speed service.

Eleven towns in Tompkins and Cayuga County have jointly applied for a federal grant to create the infrastructure needed to make high speed wireless or fiber optic-to-the-home service available throughout the area.

The Case of Proctor Creek and Coffield Ridge, W.V.

Wetzel County, W.V.

One of the most challenging areas to provide DSL service is in the Panhandle section of West Virginia.  Hilly terrain and large distances between neighbors assure a challenging broadband environment.  Cable television is out of the question in many areas, and Verizon’s legacy network was in decrepit condition before selling operations to Frontier and fleeing the state.

So it was with great excitement Frontier announced incremental progress in expanding DSL service to two small sections of Wetzel County.  Proctor Creek, close to the West Virginia-Ohio state line, and the relentlessly hilly Coffield Ridge area was finally getting DSL from Frontier — three years after Verizon promised to make the service available.

Wetzel County EMS President Jim Colvin and Del. Dave Pethtel joined Frontier’s Bill Moon at the Grandview EMS Squad station on Jan. 4, to learn more about Frontier’s expansion plans, as the Wetzel Chronicle reported.

Moon informed customers that DSL was now available in both areas and it’s only the beginning of Frontier’s plans to deliver expanded broadband service across West Virginia.  He said Frontier aims to “do things right the first time,” taking more time to establish service in efforts to prevent customers from dealing with the inconveniences of repeat visits from technicians.

“We want to bring the feel of a local company with the advantages of a big company,” Moon said. He went on to say that being a manager specifically for one region meant day-to-day decisions could be made at the local and personal level. “A lot of the red tape is gone,” he told the Chronicle. “We can make things happen directly and get things resolved quickly.”

“There is nothing quick or personal about Frontier Communications,” Shirley tells Stop the Cap! from her home in Proctor.  Her sister signed up for Frontier’s broadband service Jan. 15, and it has worked for exactly three days.  “She has never dealt with a more disorganized company.”

Shirley says nobody from Frontier ever marketed DSL to her sister’s family.

“I read the story in the Chronicle and called her right away, because they have been waiting for broadband for at least 10 years,” Shirley says.  “Calling Frontier was the first mistake — the company couldn’t bring up her account for 15 minutes.”

Shirley says her sister finally succeeded in ordering the service after her line was “qualified.”  She specifically told Frontier “no thanks” to a heavily pushed big package of services from the company, and she did not want to get into a term contract.  But Frontier signed her to one anyway.

“Installation turned out to take almost two weeks because the installer never showed up and she actually got her first bill with DSL charges on it before they installed the service,” Shirley says.  “She called me right away — they signed her up for a calling plan she didn’t want, a hard drive backup service she never ordered, and a one year contract she won’t accept.”

Frontier took all of the extra services off her bill without a fight, even as she still waited for the installer to show up.

“It worked for three days — three days,” Shirley reports.  “Ever since the last heavy rain, the modem lights just blink and Frontier tells her it must be a line problem, but she’s still waiting for someone to come fix it.”

Frontier is charging Shirley, and her neighbors, nearly $40 a month for 1.5Mbps DSL service.  It was supposed to be 3Mbps, but Moon admitted to residents the farther a customer is from a hub, the slower the connection will be.

Common Congestion Symptoms?  Frontier Promises Relief

National Radio Astronomy Observatory in Green Bank

Meanwhile, residents in Pocahontas and Webster counties in eastern West Virginia have DSL service, but intolerable congestion has made it practically unusable since last Thanksgiving.

Nate in Marlinton has had DSL service since Verizon ran it, and believes Frontier has successfully run DSL straight into the ground in the state.

“Frontier actually managed to achieve slower speeds than my neighbor’s satellite Internet service, which is simply amazing,” Nate tells Stop the Cap! “He had Frontier DSL as well, but he went back to the satellite because it was actually better in the evenings.”

Nate’s in a good position to know he has a good quality line to Frontier’s central office — he can see the building from his house.

“When Verizon ran DSL, I actually got better speeds than they promised because you can count the line length between me and the central office in yards, not tens of thousands of feet,” Nate says.  “Now the problem is with Frontier’s own pipeline to the rest of the Internet, which has become hopelessly congested.”

Nate criticizes Frontier for claiming their network has loads of fiber optics for their broadband service.

“Not for ordinary West Virginians they sure don’t,” Nate says.

The Pocahontas Times covered Frontier’s molasses-slow broadband speeds, getting promises that better broadband was on the way late last week.

“But you have to read further down in the story to find the company is spending its time, attention, and money on a fiber network connecting the National Radio Astronomy Observatory in Green Bank with West Virginia University in Morgantown,” Nate complains. “Although that fiber travels down the same phone poles and streets our phone lines do, that sure doesn’t mean we’ll be able to access it.”

Reed Nelson, Frontier’s Director of Engineering for West Virginia, vaguely offered the $5.9 million, 66-mile fiber project will indirectly benefit consumers through fiber loops installed along the way.  He was joined by an apologetic Dana Waldo, Frontier’s senior vice president for West Virginia.

“We know we’ve had some bumps in the road,” Waldo said at the outset of the meeting.

“This is very much like being on the Interstate highway at rush-hour,” he said. “It gets congested. What we’re trying to do is look for paths where we can reduce that congestion. That’s the short-term fix.”

Nate remains unimpressed.

“This is a residential broadband improvement project through osmosis — somehow Frontier’s congested network problems in the area will be resolved by an institutional network we cannot access,” Nate says. “The fact the company turned up at the Observatory to make these announcements before an audience of NRAO technical and executive staff, Pocahontas County Commissioners and representatives of the local schools and libraries, tells you all you need to know — this is an institutional, not residential network.”

Pocahontas County's Cranberry Glades: Go for Nature's Mountain Playground, but don't stay for Frontier's broadband.

Our regular reader DJ, also in the affected area, says speeds have been downright terrible since Thanksgiving, and despite Frontier’s “new capacity” coming online last week, his service is as slow as ever.

“I’m getting anywhere between 0.5Mbps – 2Mbps if I’m lucky,” he shares.

For most customers in eastern West Virginia, Frontier’s ironically-named High Speed Max service delivers a whopping 1Mbps broadband experience.

“Customers have been paying for value not received,” Pocahontas County Commissioner Martin Saffer told Nelson.

Constituents in both counties regularly complain to elected officials about the dreadful broadband service Frontier delivers.

“This company got more than one hundred million in broadband stimulus funding and it sure isn’t helping people in eastern West Virginia,” Nate says.

Another part of Frontier’s problems is an overcongested access point in Bluefield, where Frontier exchanges traffic with the Internet’s national backbone.  Sending the majority of the state’s traffic through one data center has proved untenable, so the company plans additional access points in Charles Town, Charleston, and Clarksburg.

Frontier promises speed boosts are forthcoming, bringing 5Mbps service in the days ahead, according to the Times.

John Mutscheller, Frontier’s Technical Supervisor in Marlinton, told the Times local crews are working to increase capacity whenever they go out to service equipment in Pocahontas County.

“When we put in a new site or we augment an existing site, if they’re at one meg–we have some at three–we’re jumping them up to 5 megs,” he said. “That’s the company policy.”

An installation at Thornwood will be the first 5 Mbps site to come online in Pocahontas County, Mutscheller said. Eventually, all sites in the county will be upgraded to that level, he said.

But as the newspaper points out, not everyone will get those speeds. Generally, with the copper lines that connect customers to Frontier’s equipment, connection speeds drop off as the distance from the equipment increases. Nelson said advances in modems, like those Frontier provides customers for connecting to its network, could fix that in coming years.

Frontier continues to navigate political minefields in the state with the help of employees hired from county governments. Reta Griffith, a former county commissioner today is Frontier’s General Manager for the territory that includes Pocahontas County.

Reporters pressed Griffith on the question of refunds for beleaguered customers experiencing very un-broadband speeds from Frontier:

“We will take those concerns into consideration,” Griffith responded.

Frontier’s service agreements with customers state that speeds received are not guaranteed, but rather will be ‘up to’ the specified speed, she added.

Frontier’s own marketing materials have added to the billing headaches of the company and its customers.

“‘High Speed Max’ doesn’t mean the same thing every place,” Griffith explained.

Investigating Wisconsin’s Broadband Stimulus Give Back: Political Ploy or Bureaucracy Gone Wild

For the first time, a state has announced it is returning stimulus funding made available by the Obama Administration to improve broadband service.

Wisconsin governor Scott Walker said thanks, but no thanks to the U.S. Department of Congress, returning $23 million in broadband stimulus funds allocated to build a fiber-optic “middle mile” network to 380 Wisconsin communities — including 385 libraries. 82 schools, and numerous public safety offices in rural areas.

The decision to reject the money came in concert with a public relations push by Republicans in Washington this week calling on governors to curtail “wasteful spending” and reject stimulus projects.  Walker’s timing of the rejection has political watchers suspicious of an orchestrated campaign by state and national Republicans to call out the president’s economic programs.  Critics of the Walker administration are also accusing the governor of doing AT&T’s bidding in rejecting the public money.

AT&T has plenty of good friends in the state government, which has historically granted most of AT&T’s legislative checklist in the past ten years.  Wisconsin has taken a “hands-off” approach to cable and phone companies.  Statewide video franchising makes AT&T’s efforts to expand its U-verse IPTV system easy, without having to answer to local communities.  Rural commitments to landline phone service have also been eased for AT&T, thanks to a large lobbying effort.  Publicly-owned municipal broadband networks open to ordinary consumers are few and far between in the state, thanks to heavy opposition from the phone giant.

Walker’s track record of being extremely pro-business, and the fact he accepted more than $20,000 in campaign contributions from AT&T made it easy to claim Walker was delivering another favor to the state’s largest phone company.

But is Walker’s rejection of the state’s broadband stimulus money a help or a hindrance to AT&T?  Is Wisconsin’s governor correct when he says federal government bureaucracy was at fault?

Stop the Cap! decided to investigate.

BadgerNet: An Introduction

Governor Walker

Wisconsin’s institutional broadband network, which delivers broadband connections to large educational facilities, public libraries, and government users, is named BadgerNet — which makes perfect sense for the Badger State.  State law limits who can utilize the service — ordinary residential customers cannot — so the network is not well known outside of the circle of groups authorized to access it.

Currently BadgerNet largely exists as an extension of AT&T’s network in Wisconsin.  That is a critical point.  Had BadgerNet initially been created as an independent entity, today’s stimulus rejection might never have happened.  Wisconsin, no doubt at the behest of AT&T, built its network with a leasing arrangement, signing five-year term contracts to rent space on AT&T’s fiber-copper wire facilities.  That kept initial construction costs down, and allows the state to theoretically “walk away” from part of the network if something better comes along — a highly unlikely proposition in a state like Wisconsin.  It’s not an economic leader and has large numbers of rural counties competitors would be unlikely to serve.

Wisconsin Republicans call this arrangement with AT&T a “public-private partnership.”  Democrats call it a giveaway to AT&T, and BadgerNet officials call it one big fat headache.

Wisconsin's BadgerNet

Obama’s Broadband Stimulus

President Obama

When the Obama Administration unveiled its broadband stimulus program, it not only promised to deliver new broadband projects, but also the employment prospects for an army of consultants hired to navigate through the terms and conditions that always accompany money from Washington.

The control measures established by the Department of Commerce, which administers the money from the federal government, are designed to protect against waste, fraud, and abuse.  Unfortunately, they are often more impenetrable than software licensing agreements.  If you want the money, you must follow every requirement, or risk forfeiting it back to the government.

Wisconsin’s proposal to expand BadgerNet with broadband stimulus funding would mean discarding slower speed data connections for super-fast fiber optics.  Some 203 new miles of optical fiber were to be laid, serving 385 school districts, 74 libraries, and eight community colleges.

The federal government liked what it saw and awarded nearly $24 million in funds to launch the “middle-mile” project.  Along with the virtual check came pages of fine print — rules about how the money could and could not be spent.

As state officials and BadgerNet 2.0’s planners poured over the documents, they began reaching for the Tylenol.  AT&T’s ownership interests in the existing network turned out to be a major problem.

The ‘AT&T Problem’

“We, as a state, do not own our network. We purchase a managed service through the BadgerNet contract,” Diane Kohn, acting administrator for the Division of Enterprise Technology in the Department of Administration told the Milwaukee Journal Sentinel.

Most grant recipients either plan to build a new network from the ground up or build on an existing non-profit network.  Neither is the case in Wisconsin because of AT&T’s involvement.

“From a federal perspective, it was like we were some kind of unknown start-up firm with all of these risks attached to it,” said Robert Bocher, an information technology consultant for the Department of Public Instruction. “In fact, our network has been around since the mid-1990s.”

But it got even more difficult when BadgerNet discovered the federal government requires new fiber networks built with stimulus funds to be utilized for at least 20 years.  This important control measure protects taxpayers from fronting the costs to build state of the art fiber networks, only to be later sold off to private interests or discarded as a budget cutting move.

Wisconsin’s agreement with AT&T runs for five years, not 20.  Additionally, since AT&T largely administers the infrastructure, much of the $23 million could have ended up going straight to AT&T to cover construction costs.  BadgerNet lacks sufficient funding to completely sever ties with AT&T and build its own network, and Gov. Walker isn’t about the deliver the money required to start a new network from scratch.

BadgerNet learned a lesson most grant recipients discover after winning the money — spending it comes with plenty of wires attached, and none of them transport data.

The Davis-Bacon Act

A Depression-era law is also being blamed for supposedly creating major hurdles for broadband network construction.  The 1931 Davis-Bacon Act was enacted to require public works projects be built at local prevailing wages.  The Act became law after contractors began importing cheap labor (typically underpaid African-Americans from southern states) to work competitively bid public construction projects during the Roosevelt Administration.

Mikonowicz

Republicans currently suspect the Act of being little more than a union protection law, raising labor costs artificially and helping to bust budgets.  Wisconsin Republican senator Ron Johnson used complications in a Sauk County broadband project to bash the Act, accusing it of being responsible for wasting taxpayer dollars.

David Mikonowicz, the utility superintendent for Reedsburg, complained the Act would require him to pay more than double his anticipated labor costs for a fiber project in the community.  Mikonowicz claimed the Act didn’t provide a prevailing wage for fiber contractors, so he was forced to bid out the project at wages suitable for high voltage wiring projects — $40 an hour.

That false premise made it to the pages of the Journal Sentinel in an earlier piece — a bit of political theater to bash unions, the federal government, and play up local communities as the innocent victims of both.

Stop the Cap! had no problems finding a prevailing Davis-Bacon Act wage covering Sauk County fiber installers, so we are unsure why Mikonowicz could not:

Teledata System Installer/Technician $11.70-21.26/hr

Low voltage construction, installation, maintenance and removal of teledata facilities (voice, data, and video) including outside plant, telephone and data inside wire, interconnect, terminal equipment, central offices, PABX, fiber optic cable and equipment, micro waves, V-SAT, bypass, CATV, WAN (wide area networks), LAN (local area networks), and ISDN (integrated systems digital network)

The Loyal Opposition & Everyone Else

The loss of nearly two dozen million dollars in federal government money was catnip for the loyal opposition.

Rep. Pocan

State Rep. Mark Pocan (D-Madison) said Walker’s broadband money giveback was hurting the state.

“Not only is he turning away construction jobs that would have come with the federal grant to expand broadband fiber to schools and libraries across Wisconsin, but he’s closing off potential to business growth that comes with bridging the digital divide,” Pocan said. “What’s worse, the root of his decision wasn’t what was in the best interest of Wisconsin, rather the best interest of his big telecommunications campaign donors.”

Gov. Walker used the occasion to blame the federal government for unnecessary bureaucracy. Mike Huebsch, appointed by the governor to serve as secretary of the state Department of Administration, issued a memo warning if they didn’t return the money, state taxpayers could be on the hook for the entire amount if the federal government found the state didn’t comply with grant requirements.

Ordinary Wisconsin residents would never see improved broadband in their homes from the middle mile project, so much of their reaction comes from a reflexive dislike of the governor, taxes and spending, AT&T, or a combination of all three.

AT&T has kept quiet through the entire affair, only stating it wasn’t interested in becoming a formal grant recipient stuck with the federal government’s rules.

Republicans and “tea party” members are thrilled Wisconsin is a leader in throwing federal money for broadband, railways, and other public works projects back to Washington, in hopes it will set an example for the federal government to follow.

What Happens Next

The state says it is negotiating an extension of the existing AT&T contract for another five years, and points to advances in copper wire-delivered bandwidth and the fact AT&T already provides fiber connectivity for certain parts of BadgerNet.

While AT&T has been labeled the ultimate culprit for the broadband stimulus debacle, it’s not as guilty as some might think for these reasons:

  1. The initial failure of the state to own and operate its own network, instead of leasing access from AT&T;
  2. AT&T gets the money whether Wisconsin leases another five years of service from AT&T, or stimulus funding gets diverted to AT&T to bolster BadgerNet’s existing network;
  3. AT&T is sitting pretty whether it has a five year lease or a 20-year stimulus-mandated contract.  In fact, AT&T could set its rates at today’s relatively high prices for network connectivity that Wisconsin would still be paying two decades from now.

That doesn’t mean AT&T is a good actor in Wisconsin.  While the company has steered clear of this debate, its lobbyists continue to fight off any potential competition from community-owned networks that threaten to deliver service to residential and business customers.  Few Big Telecom providers complain about institutional networks like BadgerNet, because heavy lobbying on their part several years ago won state laws that forever prohibit ordinary consumers from ever buying service from them.

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