Baller Callenbach Deichler - Leveraging City Assets: Fiber & Beyond - GCS16

1. Leveraging City Assets for
Fiber and Beyond
Jim Baller, Baller Stokes & Lide, PC
Brett Deichler, City of Kansas City, KS
Anne Callenbach, Polsinelli Law Firm

2. Public Assets
• Public Rights of Way
o “Routine” permitting, inspection processes
o Streamlined processes
• Public Facilities
o Fiber, wireless, combined
o Poles, ducts, conduits, street lights, etc.
o Towers, rooftops, etc.
o Collocation spaces
• Other Public Assets
o Purchasing power
o Demand aggregation
o Financing – bonds, access to grants and loans, E-Rate, etc.
o Tax incentives, Enterprise zones, special districts, etc.
o Publicity

3. Ways to Leverage Assets
• Use Assets to Provide Communications Services
o Retail service model (e.g., Chattanooga, TN; Lafayette, LA; Wilson, NC)
o Wholesale service model (e.g., UTOPIA; Washington PUDs; Danville, VA)
• Public-Private Partnerships
o Public entity provides incentives, private entity builds and operates network
(e.g., Google Fiber; C-Spire)
o Public entity builds core network, private partner expands network and provides
services (e.g., UC2B, IL; Westminster, MD; Santa Cruz, CA; Huntsville, AL)
o Public entity pays private sector partner monthly “availability payment” to
finance, design, build, operate, maintain, and market network (e.g.,
Commonwealth of Kentucky)
• Numerous Other Creative Models Emerging Now

4. Key Issues in Leveraging Assets
• Legal Authority
o Check for federal, state and local restrictions and procedural requirements
• Federal “private use” restrictions on tax-favored bonds
• State P3 laws or barriers to local broadband initiatives
• Self-imposed local restrictions in franchises, pole agreements, etc.
• Non-discrimination
o Incumbents claim right to equal treatment, but non-discrimination does not
necessarily mean equal treatment – look to totality of circumstances
• Allocation and Negotiation of Risks, Benefits, Rewards
o Need to address hundreds of issues, contingencies, options

5. Public-Sector Considerations & Concerns
• Gigabit Fiber - Community Connections
o Residential Connections vs. Public-Sector Facilities
• Immediate benefits to community at-large
• Separation between service profiles
• Wired vs. Wireless connectivity – wireless “hot spots”
• Using Gigabit Fiber to…
o Support outbound communications to community at-large
o Backhaul wireless content – effectively communicating data from an end user to a node in a major network such as the Internet or
the proprietary network of a large business, academic institution or government agency
o Deploy physical assets into the communications environment – adding geospatial assets (wireless kiosks, public works &
emergency management sensors, etc.) into the surrounding community
• Tomorrow’s Gigabit Governments
o Public & Private Entity Business Partnerships – cost to develop infrastructure, support exponential increase in data demand, etc.
o Performance Metrics – stop talking about business and actually determine how to become an effective business resource for the
community at-large
o Open-Data Portals – financial/budgeting/expenditures, 3-1-1 operations, & public works data sets
o Organizational Transparency – what it takes to become transparent

6. Potential Legal Barriers to City Broadband
• Approximately twenty states currently have laws that restrict or condition municipal
broadband. In two states, Tennessee and North Carolina, the FCC has pre-empted
certain key anti-competitive state laws. Certain restrictions or conditions on municipal
broadband may be justifiable state government practices (e.g., holding a public
hearing when taxpayer funding may be utilized), but the impact of a restriction or
condition will likely depend upon context.
• For example, several states require a referendum or other ballot initiative such as a
supermajority (65%) by a municipality seeking to offer broadband services. (e.g.,
Colorado, Louisiana, Minnesota).
• Other states require public hearings, evaluation of the costs and benefits of municipal
broadband, (Wisconsin, Florida) or require a city to provide the incumbent with a right
of first refusal or to solicit bids from private providers (California, Michigan, Montana).
• Tennessee permits municipalities that operate their own electric utilities to provide
cable, two-way video, Internet service, and other “like” services, but only within their
electric service area and also subject to certain other public disclosure requirements.
• Several states, such as Missouri, South Carolina, and Utah have such burdensome
and rigorous requirements that they effectively inhibit public broadband projects.

7. Diminishing Barriers
• Know your state’s law: Comprehensive knowledge of state laws
allows municipalities to create a better infrastructure and ensure
more effective broadband strategy planning; in essence, navigating
state requirements and restrictions creates the opportunity to build a
better network.
• Stay aware of FCC matters: following pending FCC petitions to
reduce or eliminate state restrictions on municipal broadband can
create momentum through supportive comments.
• Explore new and developing funding strategies: The FCC has
four programs that could fund potential grants. Reforms of these
programs occur relatively often.