By Mark Binker
RALEIGH — A bill utility companies say would protect them from unfair competition has raised the ire of city leaders and public interest advocates, who complain it will stifle competition.
The measure would require cities and counties to clear a series of hurdles before offering services such as cable television, phone and broadband Internet.
Bill opponents are most concerned about the ability to offer Internet access, which is increasingly seen as a necessity for businesses and education. They say the proposed restrictions could hurt municipal efforts to recruit businesses or help bring affordable broadband Internet to lower-income areas.
"Broadband is just that important. It's just like bringing in electricity or water or gasoline, it's that much of a need," said ToNola Brown-Bland, an assistant city attorney for Greensboro.
Businesses say the measure merely ensures governments won't use their powers to undercut prices offered by private companies.
Under the proposed requirements, governments would have to hold hearings and referenda before getting into a communications business. Also, the bill places restrictions on how a government could subsidize its efforts and would require that the government-run system pay for itself in four years. The city doesn't have any plans to get into the cable business, Brown-Bland, said, but it could have unintended consequences later.
Utility company officials say the measure is simply a matter of fairness.
"What we're talking about here is municipal entities that are entering into direct competition with services provided by companies in the communications business," said Randy Fraser, a vice president for government affairs with Time Warner.
Governments, he said, should not be allowed to subsidize their communication businesses with tax revenues or fees collected for other services.
AT&T spokesman Clifton Metcalf said the referendum requirement is reasonable because it forces government leaders to justify their actions to taxpayers, similar to how a business justifies its work to stockholders.
"So in this case, a government would approach its stockholder, its citizens, and present its business case," he said.
Public interest advocates, including the AARP and N.C. Public Interest Research Group, have lined up against the bill.
"It appears to be an anti-consumer, anti-competition bill," Rep. Pricey Harrison said.
Legislation that passed last year allowed communication companies to not serve an area if it wasn't economically feasible. This bill, she said, would keep government from stepping into the gaps in service as a result of that law.
Rep. Hugh Holliman, a Davidson County Democrat and one of the measure's sponsors, said he agreed the original version leaned too far toward business. When the House Public Utilities Committee hears the measure today, Holliman said its language should be softened, perhaps taking out the requirement for a referendum.
Rep. Nelson Cole, a Rockingham County Democrat and co-sponsor of the measure, said he was concerned for cities and counties that are already offering some form of Internet service. Reidsville, for example, offers free wireless Internet access in its downtown area, Cole said.
Bill sponsors and utility companies say the measure would not affect such free wireless offerings. Municipal leaders are less sure.
"The bill says you can't offer the service for less than the cost of providing it, and free is less," Brown-Bland said.
