July 23, 2021
RE: Broadband Infrastructure Spending
Dear Senators:
We write to you today over some concerning developments in the bipartisan infrastructure negotiations on broadband. We are guided by the principles of limited government and believe that the flaws in the infrastructure framework go well beyond the issues discussed here. Nonetheless, our present aim is to advocate specifically against proposals that would enact price controls, dramatically expand agency authority, and prioritize government-controlled internet.
The infrastructure plan should not include rate regulation of broadband services. Congress should not authorize any federal or governmental body to set the price of any broadband offering. Even steps that open the door to rate regulation of broadband services will prove harmful in the long run.
Nor should Congress continue to abdicate its oversight responsibilities to executive branch agencies like the National Telecommunications and Information Association. Giving NTIA unchecked authority to modify or waive requirements, renders all guardrails placed by Congress meaningless. There must be oversight of the programs to ensure that taxpayer dollars go toward connecting more Americans to broadband as opposed to wasteful pet projects.
Historically, attempts by NTIA to close the digital divide through discretionary grants have failed, leading to wasteful overbuilds,[1] corruption,[2] and improper expenditures.[3] The American Recovery and Reinvestment Act of 2009 created the billion Broadband Technology Opportunities Program (BTOP) grant program administered by NTIA. From 2009, when BTOP was instituted, to 2017, at least one-third[4] of all the reports made by the Inspector General for the Department of Commerce were related to the BTOP program, and census data showed that the BTOP program had no positive effect[5] on broadband adoption. And this was with only billion in taxpayer dollars. We cannot afford to make the same mistake with much greater sums.
Legislation must be clear and not create ambiguities that are left to the whims of regulators. While “digital redlining” is unacceptable, the FCC should not be allowed to define the term however it sees fit and promulgate any regulations it thinks will solve problems—real or imagined. Doing so would give the agency carte blanche to regulate and micromanage broadband in any way it desires. This would be an egregious expansion of FCC authority. Moreover, definitions and regulations could change whenever party control of the agency changes, leading to a back-and-forth that creates uncertainty for consumers and businesses.
Legitimate desire to ensure that low-income Americans have access to broadband infrastructure should not be used as a smokescreen to codify aspects of the recent Executive Order on Competition, which should not be included in any bipartisan infrastructure agreement. Republicans fought hard to support the FCC’s Restoring Internet Freedom Order. Any legislating on the functions and deployment of Internet technologies must move as a standalone bill through regular order with committee review. These questions are far too important to shoehorn into a massive bill without rigorous debate.
Any funding for broadband buildout must target locations without any broadband connection first, and this should be determined by the Congressionally mandated FCC broadband maps. Congress has oversight over the FCC and the FCC has already conducted several reverse auctions. Reverse auctions get the most out of each taxpayer dollar towards closing the digital divide. Areas where there is already a commitment from a carrier to build out a network, should not be considered for grants, and the NTIA should not be able to override the FCC’s map to redefine “unserved” and subsidize duplicative builds.
Government-controlled Internet should not be prioritized in any grant program. With few exceptions, government-owned networks (GONs) have been abject failures.[6] For example, KentuckyWired is a 3,000-mile GON that was sold to taxpayers as a 50 million project that would be complete by spring of 2016. Those projections could not have been more wrong. More than five years past the supposed completion date, fiber construction for KentuckyWired is still “in progress”[7] in some parts of the state and a report from the state auditor has concluded[8] that taxpayers will end up wasting a whopping .5 billion on this redundant “government owned network” over its 30-year life. NTIA should certainly not encourage these failures to be replicated.
We appreciate your work to help close the digital divide and agree that access to reliable internet is a priority, however we should not use this need to serve as a cover for unnecessary government expansion. Please feel free to reach out to any of the undersigned organizations or individuals should you have questions or comments.
Regards,
Grover G. Norquist President Americans for Tax Reform Jennifer Huddleston* Director of Technology & Innovation Policy American Action Forum Phil Kerpen President American Commitment Krisztina Pusok, Ph. D. Director American Consumer Institute Center for Citizen Research Brent Wm. Gardner Chief Government Affairs Officer Americans for Prosperity Jeffrey Mazzella President Center for Individual Freedom Andrew F. Quinlan President Center for Freedom and Prosperity Jessica Melugin Director Center for Technology and Innovation Competitive Enterprise Institute Matthew Kandrach President Consumer Action for a Strong Economy Roslyn Layton, PhD Founder China Tech Threat Ashley Baker Director of Public Policy The Committee for Justice Tom Schatz President Council for Citizens Against Government Waste Katie McAuliffe Executive Director Digital Liberty Adam Brandon President FreedomWorks George Landrith President Frontiers of Freedom Garrett Bess Vice President Heritage Action for America Carrie Lukas President Independent Women’s Forum Heather Higgins CEO Independent Women’s Voice Bartlett Cleland Executive Director Innovation Economy Alliance Tom Giovanetti President Institute for Policy Innovation Seton Motley President Less Government Matthew Gagnon Chief Executive Officer Maine Policy Institute Matthew Nicaud Tech Policy Specialist Mississippi Center for Public Policy Brandon Arnold Executive Vice President National Taxpayers Union Tom Hebert Executive Director Open Competition Center Eric Peterson Director Pelican Center for Technology and Innovation Lorenzo Montanari Executive Director Property Rights Alliance Jeffrey Westling Resident Fellow, Technology & Innovation Policy R Street Institute James L. Martin Founder/Chairman 60 Plus Association Saulius “Saul” Anuzis President 60 Plus Association David Williams President Taxpayers Protection Alliance* individual signer; organization listed for identification purposes only
[1] Eggerton, John, “Taking Aim at EAGLE-Net,” Multichannel News (Sept. 28, 2012), https://www.nexttv.com/news/taking-aim-eagle-net-381202
[2] See “Corruption in Tallahassee? FBI to Decide.,”Tallahassee Reports, (Mar. 29, 2011), https://tallahasseereports.com/2011/03/29/corruption-in-tallahassee-fbi-to-decide/
[3] Wyatt, Edward, “Waste Is Seen in Program to Give Internet Access to Rural U.S.,” New York Times, (Feb. 11, 2013), https://www.nytimes.com/2013/02/12/technology/waste-is-seen-in-program-to-give-internet-access-to-rural-us.html
[4] See: “NTIA,” U.S. Department of Commerce; Office of Inspector General, (2011-2021), https://www.oig.doc.gov/Pages/National-Telecommunications-and-Information-Administration.aspx
[5] Beard, T. Randolph, et al., “Bridging the Digital Divide: What Has Not Worked But What Just Might,” Phoenix Center, (June 2020), https://www.phoenix-center.org/pcpp/PCPP56Final.pdf
[6]A 2020 report catalogued 30 examples of government-owned networks across 18 states which resulted in poor performance and poor use of taxpayer dollars. See: “GON with the Wind: The Failed Promise of Government Owned Networks Across the Country,” Taxpayer Protection Alliance, (May 13, 2020), https://www.protectingtaxpayers.org/report/gon-with-the-wind/
[7] See: https://kentuckywired.ky.gov/Pages/index.aspxi.
[8] See: “State auditor: Kentucky ignored concerns about KentuckyWired project, WKYT, (Dec. 16, 2019), https://www.wkyt.com/content/news/State-auditor-Kentucky-taxpayers-on-the-hook-for-15-billion-for-KentuckyWired-566243771.html