Building Next- Generation Networks

Transcription

1 Local Strategies for Building Next- Generation Networks: The Evolving Role of Permitting and Environmental Review in U.S. Communications Policy Alex Braunstein, Associate, Kearns & West, USA Broadband and wireless infrastructure has traditionally faced pre- deployment barriers from local government review network infrastructure build- out through exercising their land use powers to manage telecommunications infrastructure. Recent cases of network deployment in the U.S. use programmatic agreements and streamlining measures to fast- track environmental review, permitting, and rights of way processes that are part of building and upgrading network infrastructure. In 2008, the California Broadband Task Force identified model permitting standards, public- private partnerships, and reform of rights of way policies to encourage deployment to underserved areas. Broadband access programs funded by the American Recovery and Reinvestment Act (ARRA) have embraced similar strategies in an effort to expedite lengthily review and revision cycles. Development agreements reached in California s Central Valley and, notably, between Google Fiber and Kansas City are evidence of emerging strategies for encouraging innovation. Recent initiatives to bring municipal fiber and other infrastructure upgrades to Los Angeles provide additional context for thinking through the challenges of advancing communications projects that balance the goals of broadband deployment and protection of public, and make clear competing models of decision- making that inform the debate. Introduction Extending and enhancing broadband infrastructure across the United States is increasingly understood as both a national imperative to ensure America s competitiveness in the global information economy and as a major investment in job creation that carries an array of benefits. The National Broadband Plan (NBP) represented a major step forward in building consensus on the need for communications infrastructure and the transformative power of high- speed wired and wireless connectivity across industries, including education, medicine, agriculture, and entertainment. Significant progress in broadband access and technology along with substantial investments in high- speed facilities has helped narrow the digital divide and provide a platform for new innovation and civic growth. While recent public policy initiatives as well as public and private sector investments have lead to major advances in U.S. communications infrastructure, remaining challenges include uneven adoption, connection speed, and disparities between urban and rural access. Recent proceedings at the FCC, and reports by government agencies and carriers have identified streamlining of permitting processes and rights of way (ROW) access as key strategies for achieving these goals. Addressing the issue of Federal permitting requirements in specific, a 2013 federal working group report suggests that permitting reform would lead to multiple benefits, including an increased number of critical mile broadband facilities serving rural communities: [N]atational incumbents and small competitive carriers currently face significant challenges when working to secure access to Federal rights of way (ROW) or buildings to deploy broadband 1

2 infrastructure. Improved processes for providing access to Federal lands and buildings for broadband deployment would increase the number of critical middle mile broadband facilities serving rural communities, improve services in urban areas, help increase competition between broadband providers, and multiply the public benefits of existing Federal infrastructure investments. 1 The report highlights interagency coordination, stakeholder input, and the role of new technological tools as important components for securing these investments. Recent policy statements and infrastructure projects suggest an evolving relationship between local governments, land- use issues and the deployment of next- generation networks (NGN). The shifting terms of national, state, and local environmental compliance and permitting requirements have the potential to shape broadband deployment in the United States in the short and long term. Addressing nexus of regulatory issues around permitting and environmental review is not simply a matter of granting regulatory relief, eliminating redundant requirements, and/or determining best practices for categorical exemptions and reclassification under NEPA, NHPA, and state laws such as CEQA. Agencies, local government, and carriers have recognized that securing community input and encouraging coordination and partnership building, and pooling information are key components to the development of new permitting practices. One consideration raised in recent filings is whether effective reform in this area will amount to incremental adjustments in current practice or a fundamental reorganization of planning and oversight responsibilities at the state, local, and federal levels. To the extent that these developments represent an organizational (or inter/intra- organizational) shift within agencies, this raises policy- level questions regarding the composition and distribution of responsibility between states, local governments, and carriers, as they work to achieve national goals in ways that address local demand and adequately balance the need for communications infrastructure with the imperative to minimize impacts to public resources. In practice, the uncertainty from which permitting reforms emerge leads to varying results regarding the distribution of responsibility within governance collaborative structures. State and federal agencies have often provided structure by developing general guidelines and identifying core goals, while local partners have brought together diverse interests and proposed plans to build and upgrade broadband facilities in their respective jurisdictions. 2 Perhaps not surprisingly, California has been noted as a special case in permitting reform, and as I ll discuss below, Los Angeles may be more special still. The case studies and proposed policy solutions I examine here emphasize coordination and public- private partnerships, as well as the importance of public input and monitoring to understand the varying needs of communities. Developing practices that encourage learning- by- monitoring, information pooling, and benchmarking are fundamental to assessing the challenges and successes of next- generation networks, and, I suggest will be particularly critical to building last- mile connections, where collective interests that help achieve regional middle mile facilities are liable to break down. 3 2

3 Google Fiber Kansas City In June 2009, Google submitted initial comments in support of the National Broadband Plan that offered additional proposals for advancing US communications infrastructure to meet the demands of the 21 st century. 4 Highlighting the need for new strategies to achieve fiber deployment, by early 2010 Google announced its experimental fiber- to- the- home pilot project, asking for interested communities between 50,000 and 500,000 people to respond to Google s request for information (RFI). 5 On the day of deadline, Google project manager James Kelly wrote that the RFI had received 600 community responses. By the time the RFI deadline had passed, the tally had exceeded 1, Selecting the Kansas City Metropolitan area as the first recipient of the fiber- to- the- home (FTTH) service, Google carved the metropolitan services into 202 neighborhoods, and asked interested subscriber to pay $10 to preregister for the service, establishing quotas ranging from 5 to 25 percent per neighborhood depending on the population density, before going forward with the street- level installation. 7 Speaking about Google s selection of the Kansas City area, Milo Medin, Vice President of Access Services, said that Google wanted to find a location where we could build quickly and efficiently. Kansas City has great infrastructure. And Kansas has a great, business- friendly environment for us to deploy a service. The utility here has all kinds of conduit in it that avoids us having to tear the streets open and a bunch of other stuff that really differentiates it from other places in the country. 8 In testimony to Congress, Medin further emphasized issues of rights of way and environmental compliance, stating that: Governments across the country control access to the rights of way that private companies need in order to lay fiber. And government regulation of these rights of way often results in unreasonable fees, anti- investment terms and conditions, and long and unpredictable build- out timeframes. The expense and complexity of obtaining access to public rights of way in many jurisdictions increase the cost and slow the pace of broadband network investment and deployment. Medin stated further that Google recognizes the importance of certain types of state and local environmental rules, but that laws like California Environmental Quality Act (CEQA) make it prohibitively expensive for companies to invest in new projects, such as our fiber project, within California. 9 In practice, Google s approach to choosing service areas and building street- level services to a select number of fiberhoods has been labeled by some as cherry picking. 10 At the same time, the project has also gained attention because it does extend service to previously unconnected costumers, representing a departure from the approach by carriers to offer fiber upgrades to areas with existing wireline DSL service. Verizon, for example, invested eight years and $23 billion in its FiOS service, with a business model that focused on the strongholds of Verizon country. As a Verizon spokesman put it: Our business model does not call for FiOS to be built out into areas where we have not historically provided wireline service. 11 Verizon first made its service available to 18 million U.S. households and then proceeded to sell the service plans. Google took a demand- driven approach, taking measures to pre- guarantee subscribers, and allowing citizen to determine deployments to Kansas City service areas. While Google is not bound by universal service or build- out obligations, the development agreement between Google Fiber and 3

4 Kansas City does commit Google to build in neighborhoods that are economically distressed. According to the terms of the development agreement, Google is obligated to offer commercially reasonable efforts to offer service at speeds up to 1Gbps; build, operate and maintain the FTTH network; provide high speed internet to the city at 300 locations at cost of establishing service (and then free of charge); and manage all coordination with resident community groups, neighborhoods, blocks, and residents individually regarding the project s logistics, impacts, and schedule. 12 In exchange, Kansas City granted Google access to city rights of way, as well as access to all related assets and infrastructure, including conduit, fiber, poles, rack space, nodes, buildings, facilities, and available land (all free of charge). The development agreement also secured cooperation form Kansas Power and Light. Additionally, the City agreed to fast- track all related permits, cooperate with Google in efforts to gain access to poles and rights of way owned by third parties. Kansas City and Google Fiber also agreed to terms for integration of municipal and Google staff for the project: Kansas City would create a dedicated project team and provide a single point of contact to oversee coordination across all city departments and an Executive Sponsor to facilitate interaction between Google and the City Council. The public- private partnership- between Google and Kansas City achieved timely implementation, gaining efficiencies through a programmatic agreement that covered all permits and negotiating access to public resources. Notably, the project combines such relief with outreach efforts and commitments that bring high- speed internet connections to households that have not traditionally received service. Some claim that Google Fiber has put pressure on incumbents and cable operators in Kansas City to increase the speed of their service offerings, however, the evidence behind these claims is mixed. 13 The project presents interesting organizational and inter- organizational models for building next- generation networks, though there may be potential for additional franchising costs for Kansas City, depending on how the network evolves. 14 The extent of the service area, its impact on the regional and national communications market, as well as the extent of the carrier s commitment to providing service to economically disadvantaged communities will be further revealed as the project expands. 15 Central Valley Next Generation Broadband Infrastructure Project Deploying a 1,371- mile fiber backbone connecting anchor institutions in 19 counties, the Central Valley Next Generation Broadband Infrastructure Project received a $46.6 million award from NTIA s Broadband Technology Opportunities Program (BTOP) as well an additional grant from the California Advanced Services Fund. BTOP middle mile broadband projects have largely funded fiber (89 projects) and fiber and wireless (24 projects) infrastructure investments. The construction of middle mile infrastructure is seen as critical to connecting underserved communities to the internet backbone and reducing cost to broadband service providers of building the last mile infrastructure. 16 Lowering the cost of last mile connections, these middle mile facilities funded by the American Recovery and Reinvestment Act (ARRA) are meant to enable enhanced ISP offerings to homes and businesses. 4

5 The Central Valley project followed BTOP guidelines in defining critical needs, proposing comprehensive community infrastructure projects that engage a wide range of local partners and address the needs of multiple target groups, while leveraging public and private resources. The project, a joint effort between the Central Valley Independent Network (CVIN) and Corporation for Education Network Initiatives in California (CENIC, a non- profit) captures these characteristics on an ambitious scale. The project plans to provide fiber connectivity to 19 county offices of education sites, 14 community college sites, three state universities, 20 county/main libraries, and seven public safety sites as anchor institutions. 17 Seven of the ten cities served by the project have among the highest unemployment rates in the country. 18 Through providing high- capacity internet access to anchor institutions, residents, and businesses across the project area, the CVIN/CENIC project brings broadband to underserved communities, both urban and rural. The current plans for the network also includes 10 Gbps service to 350 existing cell towers, to extend last mile wireless build- out in Fresno, Kings, Kern, and Tulare counties to provide services to more than 1.5 million households. 19 The project was granted a negative declaration by the CPUC and secured CEQA categorical exemptions from local authorities, along with rights of way access, and other public resources through development agreements with cities and counties. 20 In the development agreement between CVIN and the City of Fresno, the carrier agreed to provide upgrades to city facilities that the City will own free and clear in the case of termination of the agreement, while the ownership of other CVIN project elements are retained by the carrier, which pays for the cost of the project (including maintenance and repair), as well as $100,000 for City staff time. In exchange, the city identifies infrastructure for exclusive use by CVIN, waives all fees related to permitting requirements, and agrees to cooperate with the carrier in enabling it provide the services detailed in the agreement. In navigating challenging NEPA and CEQA requirements to extend a fiber network to underserved communities in California, thus far, the Central Valley Next Generation Broadband Infrastructure Project has been impressive. The organizational structure of the project aims to pool expertise and resources from private sector providers, regional institutions, and local governments. As conduit is laid, and middle mile facilities continue to be turned up, the project will not only connect education institutions and provide public resources, it promises to significantly lower costs to provide connections to residents and businesses. The later stages of the project will not only test the goals of the project to extend service to rural and underserved communities, it has the potential to act as a test case for addressing coordination challenges between the carrier, partnering institutions, and communities throughout the region. Building the infrastructure to extend last mile connections across 19 counties will require understanding a divergent interests, and likely present significant challenges. The project plan aims to address these challenges at the local level by forming strategic relationships with incumbent providers, ultimately allowing commercial providers to connect to the CVIN/CENIC backbone, and working with Sustainable Broadband Adoption (SBA) and Public Computer Center (PCC) projects on demand stimulation initiatives. 5

6 Los Angeles FTTH Network In late 2013, Los Angeles City Council, the Mayor s office, and the city s Information Technology Agency began circulating details of an RFP to run fiber to every residence, business, and government within city limits. Recently elected council member Bob Blumenfield quickly became the project s most visible advocate, touting the proposal for a citywide network that would include free access at a speed between 2Mbps and 5Mbps, and paid tiers up 1 Gbps. Though the full RFP has not yet been released, early indications are that the city would favor carriers that can offer not only fiber internet but also wireless and data center hosting. The city would require the network would be open, and that the carrier sell wholesale access to other network providers that want to deliver services over fiber. 21 Still in the conceptual stages, the network as the L.A. City Council and Information Technology Agency have proposed it differ from both Google Fiber and the Central Valley Information Network in several respects, including that the vendor to win the project would be required to secure the necessary permits. Steve Reneker, ITA General Manager, has said that the city is requiring vendors that respond to pay for the city resources needed to expedite any permitting and inspection associated with laying their fiber we're going in with the assumption that the vendor is going to absorb those up- front costs to make sure they can do their build- out in a timely fashion." 22 The city has said that it will act as anchor tenant for the project, though without the details of the full RFP, it remains to be seen how the project will move forward, or how the city will shape the project to meet the needs of residents, and attract a carrier to invest. Discussions of a possible citywide network have occurred in proximity to other major infrastructure and planning initiatives in Los Angeles, including the mayor s Great Streets Initiative, which singles out L.A. s street system as the city largest public space asset, covering 13 percent of the city s land area, and spanning 6,500 miles. 23 The initiative aims to establish a dig once 24 policy for city streets and also forms an interdepartmental Working Group to devise a comprehensive strategy for focusing on specific improvements to defined corridors. The executive order states that the working group will coordinate closely with Los Angeles Department of Water and Power, though the impact of the initiative on the proposed fiber network or other telecommunications projects remains to be seen. 25 In addition to presenting substantial coordination challenges within the City of Los Angeles as well as between the city and a service provider, the project may potentially be shaped by policy developments at the state and federal level. The California Public Utilities Commission recently vacated its 2011 decision and reopened the rulemaking proceeding to make the Commission the only agency able to issue discretionary permits for communications projects in California. Under General Order 170, the CPUC would become the lead agency under CEQA for all communications projects, pursuant to its commitment to ensure the continued affordability and widespread availability of high- quality telecommunications services to all Californians. 26 Intended to create regulatory certainty and uniformity in public resource requirements, the 2011 Final Decision was vacated and concerns surrounding preemption of local control, colocation rules, and categorical exemptions of DAS equipment continue to fuel controversy around the order. 6

7 The FCC s Acceleration of Broadband Deployment proposed rulemaking (FCC ), may also impact plans for the project, as the proceeding threatens to limit local authority in managing the expansion of broadband facilities, and potentially even erode the city s bargaining power. 27 In November 2013, the Los Angeles City Council passed a resolution in opposition to FCC , citing specific provisions on colocation of wireless devices and utility cabinets, and claiming that the proposed rulemaking in its current form would impede the city s ability to protect its policy interests with regard to wireless siting. 28 As it evolves, state and federal proceedings to streamline permitting and rights of way access have potential to shape the policy goals and underlying practices at stake in balancing efforts to accelerate broadband deployment with the claims of local control. These proceedings will help define comprehensive broadband infrastructure policy, but also identify programs and educational activities that work towards a coordinated effort at all levels of government. 29 The CPUC is reviewing legacy, centralized, and hybrid approaches to CEQA, while the FCC is considering race to the top - style competitions and other initiatives to encourage uniformity and reporting on best practices. The outcomes of these proceeding will help inform implementation of the National Broadband Plan, and also may help decide the role municipal broadband networks have in Los Angeles and elsewhere, in reaching NBP goals. Conclusion The evolving relationship between local authority, permitting, and the development of next- generation networks raises important policy questions tied to building the infrastructure that will enable the U.S. to close the digital divide catch up in deploying broadband to all Americans. Both voluntary agreements between carriers and municipalities, as well as state and federal policy statements have recognized that efforts to programmatically address permitting represent a key strategy for building 21 st century infrastructure. Proposals to centralize and streamline permitting practices face a major challenge in reconciling imperatives for fast- tracking with the needs of local communities, both metropolitan and rural. Notably, recent streamlining strategies have been tied to extending service to rural and underserved communities, tying new permitting practices to not only needed upgrades of existing facilities, but also deployments that reach Americans who are without a high- speed internet connection. Reaching these populations and accomplishing the Nation Broadband Plan s public safety goals should continue to be key motivations for streamlining practices going forward. Public and private actors should engage in monitoring and reporting practices to build knowledge of best practices for understanding demand in local communities, 30 and create new strategies for pooling information and benchmarking to identify powerful and durable models for building next- generation networks. 31 7

8 1 Broadband Deployment on Federal Property Working Group, Implementing Executive Order 13616: Progress on Accelerating Broadband Infrastructure Report, (2013). 2 As this process moves forward, the choices and experiences at each of these levels should inform policy, give direction to future projects, and influence reforms. 3 See Michael Dorf and Charles Sabel, A Constitution on Democratic Experimentalism in Columbia Law Review 98:2, 1998 (309, 325, 345). On municipal broadband, collective action, and divergent interests see Ting (2009). 4 Google submits initial comments supporting a National Broadband Plan, June 6, 2009, 5 Think big with a gig: Our experimental fiber network, February 10, 2010, For a discussion of Google s pilot project in the context of municipal fiber and the goals of the NBP, see Susan Crawford. The Costly Gift, in Captive Audience: The Telecom Industry and Monopoly Power in the New Gilded Age (New Haven, CT: Yale UP, 2013), Next steps for our experimental fiber network, March 26, 2010, 7 When Will the Rest of Us Get Google Fiber? MIT Technology Review, February 4, 2013, 8 How Kansa Won the Google Fiber Jackpot and Why California Never Will, Forbes, August 4, 2012, 9 Testimony of Milo Medin, Vice President of Access Services, Google Inc, Committee on Oversight and Government Reform Field Hearing On Innovation and Regulation, April 18, 2011, 10 Karl Bode and others have worried about how the publicity around Google Fiber effectively validates cherry picking practices. See for example: Four Years Later: Just How Big is Google Fiber s Impact, November 19, 2013, Fibers-Impact Bill Kula, Verizon spokesman, quoted in the MIT Technology Review. 12 Development Agreement between City of Kansas City and Google Fiber Missouri, 13 Metrics that suggest that the incumbent telephone company (AT&T) and cable company (Time Warner Cable) have turned up speeds since Google Fiber Kansas City deployments began have come under criticism. 14 For example, potential costs from market power, information advantage, and lock-in. See Carol Ting, Municipal broadband Internet initiatives: Lessons from US history, in Madden and Cooper eds. The Economics of Digital Markets (Northampton, MA: Edward Elgar Publishing, 2009),

9 Importantly Ting also notes that optimal ownership structure changes with technology and the nature of demand. 15 Notably, under the franchising model, adequate expansion can be a source of dispute, with governments preferring large scale expansion and private providers insisting on incremental growth to extant sources to minimize risk (Ting, 314). 16 Executive Office of the President, Recovery Act Investments in Broadband: Leveraging Federal Dollars to Create Jobs and Connect America, (2009) pages Fierce Telecom, Central Valley Independent Network to begin work on California middle mile project, November 29, 2011, 18 Level 3's Advanced IP Network Plays Important Role in the $46.6 million ARRA-funded California Central Valley Broadband Project: Federal-Funded Project to Bring Economic, Educational Benefits of Advanced Internet Services to Underserved Rural Region using Level 3 Network, December 19, 2011, City of Fresno, Documents Pertaining to the Agreement Regarding Installation and Use of Telecommunications Fiber Optic Cable and Related Infrastructure Between CVIN LLC and CIT of Fresno 21 Bigger than Google Fiber: LA plans citywide gigabit for homes and businesses, November 5, 2013, 22 ibid. 23 Great Streets Initiative, City of Los Angeles, Executive Directive of Eric Garcetti, Mayor, issued October 10, On the Great Streets initiative, Mayor Garcetti has stated that "Their first priority will be to make sure streets projects are coordinated. No more Bureau of Street Services paving a street on Monday, DWP digging it up on Tuesday," said Mayor Garcetti. "Let's also combine a DWP pipe project with some street furniture funds and with a sidewalk repair project all at the same time." See Mayor Garcetti Issues First Executive Directive to Launch Great Streets Initiative, ve 25 Great Streets Initiative, City of Los Angeles, Executive Directive of Eric Garcetti, Mayor, issued October 10, CPUC Rulemaking , FCC , Acceleration of Broadband Deployment by Improving Wireless Facilities Citing Policies, September 26, Los Angeles City Council Resolution, S141, November 27,

10 29 Omnibus Broadband Initiative, FCC, Connecting America: The National Broadband Plan, Heather E. Hudson, Muncipal wireless broadband: Lessons from San Francisco and Silicon Valley, Telematics and Information 27 (2010), Rob Frieden discusses existing FCC and NTIA information gathering practices on broadband service and notes the tension between these practices with claims by carriers that where they do and do not provide service constitutes a trade secret. Rob Frieden, Winning the Silicon Sweepstakes: Can the United States Compete in Global Telecommunications? (New Haven: Yale UP, 2010)