Testimony of Tom Giovanetti
President, Institute for Policy Innovation (IPI)
Before the State Affairs Committee
Texas House of Representatives
March 18, 2021
Thank you Mr.\Madam Chairman for this opportunity to share our thoughts. My name is Tom Giovanetti, and I am the president of the Institute for Policy Innovation, a 34 year old conservative, free-market policy think tank in Dallas. We appreciate this opportunity to share our thoughts on HB 1505.
The broadband rollout both in Texas and nationwide has been an amazing success, and a testament to the power of using the private sector rather than depending on government to build necessary infrastructure. With the Rural Digital Opportunity Fund (RDOF) phase 1 funding, and the financial commitments of the private sector companies that have stepped up, Texas is going to see an explosion of new broadband deployment in unserved rural areas of this state.
But as we all know, barriers remain and even small barriers become significant in marginal and rural areas where the business case for broadband buildout may not be as compelling as in more densely populated areas. In fact, to accomplish the next stage of the broadband rollout to unserved areas, we have to focus on identifying logistical barriers that create unnecessary friction, delays, and costs.
It’s well understood that those who control access to necessary infrastructure may both directly and indirectly, and both intentionally and inadvertently, place barriers in the way of broadband deployment that creates unnecessary friction and delay. This is why the FCC has moved in several instances to put shot clock requirements and other regulations in place so that the broadband rollout is not hampered.
As proponents of free-markets, we still recognize that there are such things as natural monopolies, and utility poles are certainly a natural monopoly. No one would want every single provider of services to have to erect their own competing utility poles. So electricity delivery systems and their infrastructure remain a natural monopoly. Some pole owners (electric cooperatives) in a position where they can, again either intentionally or inadvertently, slow or even block broadband rollout by refusing to act promptly on requests for pole access, by extracting exorbitant fees, and by using requests for pole access to try to force broadband providers to pay for the replacement of aging poles, an expense of maintaining their infrastructure that is already figured into their rates.
HB 1505 creates a system to fairly allocate the costs of replacing utility poles without making it unnecessarily costly to roll out broadband. It creates hard timetables and shot clocks for permitting and approval, and it also creates a system for prompt dispute resolution.
This talk of shot clocks, timetables and promptness is critical, not only because it is urgent to get broadband service to unserved areas, but also because time is money, and unnecessary delays directly contribute to making it too expensive to serve some areas.
HB 1505 directly addresses the Governor’s emergency item of lowering barriers to expediting broadband deployment. It is the low-hanging fruit. There’s more that needs to be done, to be sure, and some of those proposals will be controversial, but HB 1505 should be a no-brainer and an obvious bill for passage in addressing the digital divide and ensuring that all Texans have access to broadband services as quickly as possible.