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West Virginia Lawmakers Unveil $138M Broadband Initiatives

West Virginia Department of Economic Development Secretary Mitch Carmichael unveiled a four-prong approach to spending $138 million of federal American Rescue Plan Act funds to expand broadband Internet in the state.

West Virginia Capitol
West Virginia Capitol
(David Kidd)
(TNS) — West Virginia Department of Economic Development Secretary Mitch Carmichael unveiled a four-prong approach to spending $138 million of federal American Rescue Plan Act funds to expand broadband internet in the state.

He told the interim Joint Committee on Government and Finance that two programs are intended to rapidly expand accessibility, with both rolling out this summer, and two will help fund major investments in broadband infrastructure.

"As you know, economic development is tied to broadband expansion. Not much can happen unless we have broadband," said Carmichael, who was appointed as executive director of the Development Office in February. In March, legislation raised that office to a cabinet level department.

As outlined Monday, the programs will include:

* Existing network line extension, which will provide about $25 million to encourage existing providers to expand service "the last mile or two" to reach remote locations that otherwise would not be profitable.

"It might cost $20,000 and you get back $100 a month," he said of extending broadband to an isolated location with one or two customers.

Carmichael said that, by definition, line extensions will involve existing providers, some of whom have less-than-stellar performance for internet speeds, but said participation in the program will require meeting speed valuations.

"We're not interested in funding anything that's less than 25/3 [Mbps]," he said, referring to the minimum download and upload speeds required to be considered broadband.

* Rapid wireless deployment using Statewide Interoperable Radio Network towers.

Also to receive about $25 million in funding, fixed wireless using the SIRN towers can reach remote areas where broadband expansion would otherwise take years, Carmichael said.

"The areas which we're trying to reach with fixed wireless would be years to build out broadband," he said, saying that would include State Parks that currently have no internet service.

Longer term projects include providing about $40 million for major broadband expansion projects, and $30 million in matching funds for projects funded by counties and municipalities, which are receiving American Rescue Plan Act funds, he said.

Carmichael said the Department of Development will be able to assist localities with mapping and cost analysis of local broadband projects.

"We want to provide last-mile service to people who don't have it," he said. "There's plenty of places where that does not exist."

Carmichael, who formerly co-chaired the Joint Committee as Senate president, opened his presentation by asking committee members, "Have you ever heard the song, "I've looked at life from both sides now?"

Also during the Joint Committee meeting:

* Deputy Revenue Secretary Mark Muchow said April tax collections slightly topped projections even though moving the income tax filing deadline from April to May caused income tax collections to come up $81 million short.

Muchow said sales tax collections of $126.08 million topped estimates by $22.28 million, which he attributed to many West Virginians receiving and spending $1,400 federal stimulus checks in March.

Corporate net collections of $63.3 million also far exceeded estimates and were up 200% from April 2020, he said.

"Major corporations did very well during the pandemic," he said. "If you check your stock portfolio, it shows up there as well."

On the down side, Muchow said April payroll withholding taxes were down about 5.8% from April 2019, as the state still has about 30,000 fewer jobs than before the pandemic. At the peak of the pandemic, the state lost 94,000 jobs, he said.

* Craig Slaughter, executive director of the state Investment Management Board, said it has been a good year for the state's investment portfolio, with state pension fund investments up 21.4%, or more than $3.3 billion, for the budget year-to-date.

That pushes the 20-year outlook for the various pension plans to between 7.7% to 7.9%.

The pension funds need to grow by 7.5% a year to avoid the Legislature having to appropriate general revenue funds to keep the plans solvent. Slaughter has previously told legislators that the goal of 7.5% annual growth may not be realistic long-term.

On Monday, Slaughter advised that the current upturn won't go on forever.

"Things change," he said. "Things tend to smooth out over time, and a really bad year could hit you really hard."

© 2021 The Charleston Gazette (Charleston, W.Va.). Distributed by Tribune Content Agency, LLC.

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