On June 6, Federal Communications Commission Chairman Tom Wheeler will be in Pikeville for the SOAR summit to discuss the future of broadband in Kentucky and across the United States. His remarks are likely to turn into a pep rally for government-owned broadband.
Taxpayers shouldn’t cheer.
Government-owned broadband already has harmed Kentucky taxpayers. A few years ago, a handful of lawmakers dreamed up a plan for a statewide “middle mile” network calledKentuckyWired. The network would largely be financed by taxpayers, but managed by an Australian financing firm. The total cost of the project is pegged at more than $300 million with the state issuing $289 million in bonds to finance the project. State taxpayers would be on the hook for $30 million while federal taxpayers will kick in another $23.5 million.
KentuckyWired isn’t even finished and already it’s run into significant problems because state officials planned to allow KentuckyWired to provide service to state public schools. This maneuver would have allowed the state to use federal school broadband dollars to pay KentuckyWired for service.
That may not sound so bad — shouldn’t a government network provide service to government entities like schools? Perhaps, but for that plan to work, the state had to take away the schools’ contract from their current broadband provider and give it to KentuckyWired.
The gentleman who was in charge of that process later went to work for KentuckyWired. That’s not only unethical, it sends a message to private sector job creators that they shouldn’t invest in Kentucky. State officials cannot be trusted. They’ll change the rules in the middle of the game and throw private job creators overboard when it suits.