Broadband Legislation Information Packet

• Complete Packet (pdf)
  • Letter from the Governor (pdf)
  • Legislation (pdf)
  • Summary of legislation (html below) or (pdf)
    • >> Executive Summary
    • >> Section by Section
  • Broadband bill press release (pdf)
  • Briefing documents (pdf)
  • Map (pdf)
  • Contact information (pdf)

An Act Establishing and
Funding the Massachusetts Broadband Institute

Executive Summary

What problems does this legislation address?

• High-speed Internet, or broadband, access is essential infrastructure that has been proven to stimulate economic development, create jobs, and increase property values and tax receipts. Yet 32 towns in Massachusetts are completely unserved: they have no broadband availability whatsoever. An additional 63 are underserved, with broadband access available in only some areas of the community.
• All but one of the unserved communities, as well as many of the partially served ones, are located in the four Western Massachusetts counties (Berkshire, Hampshire, Franklin and Hampden).
• Governor Deval Patrick has identified ubiquitous broadband as a key element of the Commonwealth’s economic development strategy. The goals of this legislation are to bring service to unserved areas and ultimately ensure equitable access to broadband infrastructure throughout the Commonwealth.
• Since the Governor’s announcement of the Broadband Incentive Fund in August, the Executive Office of Housing and Economic Development has been working closely with the DTC, the John Adams Innovation Institute, Berkshire Connect, Pioneer Valley Connect, and various stakeholders across the Commonwealth, not only on the proposed legislation, but also on comprehensive analysis of the challenges and potential solutions to the lack of broadband access.
• This legislation is the necessary next step to pave the way for the economic development and job creation opportunities that go hand-in-hand with being wired for the 21st Century.

What are the key elements of the proposed legislation?

• The Massachusetts Broadband Institute will be created within the Mass. Technology Collaborative to leverage existing resources and expertise and to achieve the Governor’s aggressive timelines for broadband deployment.
• The Institute will make strategic and targeted public investments, analogous to government support for rural electrification in the early 20th century, with the objective of serving all unserved communities by 2010. This will be accomplished by:
  • creating a Massachusetts Broadband Incentive Fund, capitalized by the issuance of a $25 million, general-obligation broadband bond;
  • seeding public-private partnerships to develop broadband infrastructure; and
  • targeting the citizens and businesses in unserved areas who currently have no broadband access.

• The Institute will be led by a governing board made up of key state policymakers and governor-appointed experts from a range of experiences and backgrounds that are central to the Institute’s success.
• The Institute will be responsible for measuring existing broadband access conditions in the Commonwealth, creating a central plan, subject to approval by the Secretary of A&F and the Secretary of EOHED, to address broadband access deficiencies, and managing the $25 million Broadband Incentive Fund to achieve the maximum benefit to the citizens of the Commonwealth.
• Having a clear picture of the landscape of service availability is a key component to success. The Institute will be charged with collecting detailed information to ensure that the investments made leverage the highest possible return. This legislation empowers the board to work with state agencies, municipalities, and private entities to create detailed reports of actual service conditions, location of existing assets, and assessment of needs, all of which will be integral to formulating an efficient and effective operating plan.
• The Institute will invest public funds into essential, long-lived broadband infrastructure assets, such as fiber and wireless towers, thereby lowering overall cost of deployment for private providers. o We believe $25 million provides sufficient incentive to attract private partners to make complementary investments and provide complete broadband solutions to customers in unserved areas. The fund will facilitate deployments by private operators, leveraging limited, but strategic, public investment. o Partners will be selected via a competitive procurement process that will be open to all firms, including incumbents.
• As a quasi-public organization, the Institute will have the necessary flexibility to make the most efficient use of public investment dollars by creating partnerships with private providers. The Institute will have the ability to work closely with both incumbent providers of telecommunications and broadband services and new market entrants to foster competitive and innovative solutions.

Why does this approach make sense?

• Alternative approaches have failed to solve rural broadband deficits. Government loan programs, such as the U.S. Rural Utilities Service and Michigan’s Broadband Development Authority, have not turned up enough private companies willing to shoulder the full costs of building infrastructure in low-density areas. Similarly, the non-profit “Connect” model of demand stimulation and aggregation, pioneered a decade ago in Western Massachusetts, succeeded in raising customer awareness but did not have the necessary resources to invest in developing infrastructure where it is lacking.
• Investing in long-lived elements of broadband infrastructure, such as conduits, fiber, and towers, does not subject the Commonwealth to risk of technology obsolescence. Considered on a lifecycle cost basis, broadband assets are very inexpensive compared to more traditional publicly funded infrastructures. Fiber costs much less than highways but provides similar economic benefits.
• Massachusetts is not the only state recognizing this need. Vermont has just passed an ‘e-state’ bill that authorizes $40 million in bond backing using a similar approach of partnering with the private sector to invest in critical infrastructure. California has access to a $60 million fund designed to leverage $250 million in private investment. At least six states, led by New York and South Carolina, have established broadband task forces to develop local solutions to broadband deficits.

An Act Establishing and
Funding the Massachusetts Broadband Institute

Section by Section Summary

Section 1: Finding and Declarations

This section highlights the importance of high speed Internet, or broadband, to the growth of the knowledge-based economy and the general benefit of the Commonwealth. Given that many communities across the Commonwealth have unacceptable levels of broadband access, efforts to promote affordable, ubiquitous broadband access are a clear public purpose and governmental function. Therefore, the Massachusetts Broadband Institute (the Institute) is established with the powers to assess and improve broadband access conditions in the Commonwealth, with particular focus upon communities with no access. The initial investments of the Institute are intended to support future statewide, comprehensive strategies to create conditions that encourage economic competitiveness and growth.

Sections 1A, 2, and 3: Massachusetts Broadband Incentive Fund (the Fund)

These sections provide for the issuance of bonds in an amount up to $25,000,000 for the purposes of the Incentive Fund.

Section 4: Wireless and Broadband Development Fund

This section requires MTC to transfer all moneys in the Wireless and Broadband Development Fund to the newly created Massachusetts Broadband Incentive Fund.

Sections 5, 6, and 7: Technical Corrections

The original purpose of the Broadband and Wireless Affairs Director, established pursuant to Chapter 123 of the Acts of 2006 (Economic Stimulus Legislation), is maintained but redirected to work in consultation with the newly created Institute. These are also technical amendments reflecting the creation of the Institute within the Massachusetts Technology Collaborative.

Section 8: Creation and Duties of the Massachusetts Broadband Institute

Creation of the Massachusetts Broadband Institute The Massachusetts Technology Collaborative (MTC) will establish the Institute with the stated purpose of investing in broadband infrastructure in the Commonwealth in order to achieve affordable, ubiquitous broadband access for every citizen of Massachusetts. The first priority of the Institute shall be to assess and improve the broadband conditions in Massachusetts communities that have no broadband access. MTC will also establish a fund to be known as the Massachusetts Broadband Incentive Fund.

The Institute will have a governing board that consists of the following 9 members:

• The Secretary of Administration and Finance, or designee;
• The Secretary of Housing and Economic Development, or designee;
• The Commissioner of Telecommunications and Cable, or designee;
• The Executive Director of the MTC, or designee;
• The Chairman of the Governing Board of the John Adams Innovation Institute, or designee; and
• 4 members appointed by the Governor who have knowledge and experience in fields consistent with the mission of the Institute.

The Institute will have an Executive Director, appointed by the Institute’s board.

In addition, this section requires the board to consult with the Joint Committees on Telecommunications, Utilities and Energy and Economic Development and Emerging Technologies during the preparation of a detailed plan for the operation of the Institute and the Fund. This plan will be subject to final approval by the Secretary of Housing and Economic Development, the Secretary of Administration and Finance, and the MTC corporation board before implementation by the Institute.

Institute Duties

The Institute is directed to leverage private sector and federal investment by financing the construction and acquisition of broadband infrastructure, such as fiber and towers, to promote the development and deployment of broadband access. Any equipment or other property financed by the Institute would be owned by MTC, the Commonwealth, or one or more other public entities, but could be leased or licensed, for a fee or otherwise, for use by not-for-profit or for-profit private-sector entities. Any fees paid will be credited to the Fund.

The Institute is further directed to clearly define key terms that describe the current conditions of broadband service in the Commonwealth, in particular terms of affordability, data transmission speed, un-served, and underserved.

Also, the Institute is charged with the collection of data from all available sources to develop and maintain a specific inventory of current broadband service, service gaps, existing infrastructure, and any assets that may be leveraged to support the provision of services to unserved and underserved areas across Massachusetts. This will be critical both 1) to correctly identify the areas of greatest need so that Institute resources can be targeted accordingly and 2) to measuring the Institute’s progress going forward. Finally, the Institute will file an annual report of its activities with the Governor, the Joint Committee on Telecommunications, Utilities and Energy, the Joint Committee on Economic Development and Emerging Technologies, and the House and Senate Committees on Ways and Means.