West Virginia Tasked a Department with Selling Space for Fiber, Now Firms Complain of Rising Costs

Senate Bill 445 allows the Division of Highways to acquire right of ways and lease them out for utilities to use.

by Max Garland, The Charleston Gazette / August 10, 2018
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(TNS) — Following an outcry from Internet providers ranging from Frontier to Suddenlink on how a new state law slows telecommunications expansion, the West Virginia Broadband Enhancement Council aims to make recommendations to the state Legislature on how to remedy those issues.

Senate Bill 445 became law earlier this year, along with the similar House Bill 4447. The Senate bill allows the Division of Highways to acquire right of ways and lease them out for utilities to use.

SB 445 also says the utility has to pay “fair market value” for the lease as determined by the DOH Commissioner. All money received from the leases shall be credited to the State Road Fund, per the bill’s text.

Telecommunications companies have criticized the new law’s enforcement for holding up permits and not being economically feasible, according to public comment notes from a Broadband Council infrastructure meeting last month.

“What is happening is contrary to the legislative intent [of Senate Bill 445],” said Charlie Dennie, vice president of government relations at Alpha Technologies, which is constructing an underground fiber-optic loop through Charleston and South Charleston. “The intent was to promote construction and make it easier to do so in the permitting process, not make it more expensive and difficult.”

Broadband Council Chairman Rob Hinton said the bill “did a very good thing” in opening up right of ways to more companies looking to expand broadband infrastructure. But if the DOH makes it more expensive to deploy infrastructure in the state that’s already costly to build in, that will hurt efforts to upgrade and expand telecommunications networks, he said.

Maine-based Tilson Technology Management is writing a report for the council showing what neighboring states and those with similarities to West Virginia charge for right of way access. That report could be ready by the council’s September meeting, Hinton said.

Following the report, the council will advise the Legislature on what other states are charging, so language can be tweaked in the bill to make sure West Virginia doesn’t become a high-cost state, according to Hinton.

Cost was a chief concern among representatives of Internet providers at the infrastructure meeting last month, per the public comment notes.

Chris Morris, vice president of business development and external affairs of the Bridgeport-based Citynet, said the company is hesitant to apply for federal grant money because of the bill, since it doesn’t know if it’s going to have access to right of ways for a reasonable amount.

Scott Sherman, CEO and president of HardyNet in Hardy County, warned that costs will be passed onto customers through rate increases or pole attachment fees as a result of the law. And Erin Jones, a Suddenlink representative, noted that new permits are also needed for repairs and upgrades.

“The state as a whole will fall behind in technology because we won’t have incentive to go in [and] make upgrades to our systems just knowing it’s going to double and triple our costs,” Jones said.

Company representatives also discussed how the permitting freeze has affected projects.

“We have multiple other projects that are being held up, one of which is to provide service for a state park so basically, we have Highways delaying the [West Virginia Division of Natural Resources] from getting connectivity,” Morris said.

Council Vice Chairman Robert Morris noted that he didn’t recall “one area of disagreement” on the issue among providers at the meeting.

Sen. Bob Plymale, D-Wayne and a sponsor of SB 445, said at the meeting that making right of way access to expensive for providers was not the legislative intent of the bill.

West Virginia Department of Transportation spokesman Brent Walker did not immediately respond to requests for comment Thursday on the matter.

©2018 The Charleston Gazette (Charleston, W.Va.) Distributed by Tribune Content Agency, LLC.