While other states are preempting municipal broadband, the Vermont legislature is attempting to fund it. Yesterday, policymakers in the General Assembly approved a bill that would create a new state-backed loan program community broadband networks.
The loan program will be administered by Vermont Economic Development Authority, which will provide business loans of up to $1.8 million to community broadband providers.
Alongside the loan program, the measure sets aside $700,000 for up to 12 grants to support towns that submit plans to build their own networks. The bill also creates a new broadband advisory role in state government.
The funding will come from a 0.5 percent tax hike on the universal service fund fee that is part of consumer phone bills in Vermont.
The bill must now go to the Senate where it is expected to pass. According to an Associated Press piece, local policymakers recognize that it is difficult for small broadband providers to start offering services in rural Vermont. Building the network is costly and the relatively low number of subscribers make it difficult to source funding in the capital markets.
The proactive approach on the part of local lawmakers is a departure from what other states have done. Many states have opted to pass bills backed by the telecommunications industry that make it difficult to set up municipal networks and funding mechanisms to support them. In those states, localities sometimes have to make a choice to vote against the preemption rule. As CivSource recently reported, several towns in Colorado recently made that choice, approving municipal networks that will provide coverage through an underserved region of the state.
17,000 Vermont residents lack even basic connectivity and another 50,000 have connections that fail to meet federal minimum standards.