NEWS

Lawmakers dial up broadband expansion bill

Jason Noble
jnoble2@dmreg.com

Gov. Terry Branstad's top-priority effort to spur expansion of broadband Internet access in Iowa received its first legislative hearing Thursday.

The "Connect Every Acre" proposal creates a $5 million grant program that Internet service providers could tap to expand their coverage areas and contains a tax break for new broadband Internet investments.

At a packed subcommittee hearing on Thursday, industry officials offered modest praise for the bill, which they said could at least reduce the high costs of expanding service in underserved and sparsely populated areas, if not significantly increase high-speed Internet access.

"I don't know that I'd use the word significant, but it is helpful," said Michael Sadler, a lobbyist for the telecommunications company CenturyLink. "Obviously it will fund some projects, and we're supporting anything that will move the ball forward in that regard."

The incentives would be aimed at projects expanding service in so-called "targeted service areas" — regions of the state where current Internet speeds are below 25 megabits per second for downloads and 3 megabits per second for uploads.

Such speeds are currently unavailable via in-home broadband service in much of rural Iowa, including wide swaths of southern Iowa that are effectively unserved.

Private companies and other Internet providers could apply for grants from the $5 million pool of funds on a competitive basis, with applications vetted and awards handed down by the state's Office of the Chief Information Officer.

Those grants would be available to traditional Internet service providers like CenturyLink or Mediacom, rural telecoms, public utilities and even wireless data providers, officials said.

The grant program is the most significant addition to the bill from a version that failed to win approval in 2014. Also significant, though, is the absence of language on cellular tower siting and private access to the state-run Iowa Communications Network. Both provisions were stumbling blocks last year.

One holdover from the previous legislation is a property tax exemption for new broadband Internet investments. Companies building out their Internet infrastructure would see a three-year break on property taxes, although lobbyists on Thursday said they'd like to see a longer term.

State Rep. Peter Cownie, R-West Des Moines and the bill's handler, said extending the timeframe for the exemption is a possibility.

Cownie and other members of the House subcommittee hearing the bill declined Thursday to advance it to the full Commerce Committee. Discussion will continue in the weeks to come, and changes are likely.