House Bill 1336 (HB 1336) and Senate Bill 5383 (SB 5383) both passed the legislature and were signed into law by Governor Inslee on April 24^th. Both bills attempt to address the need to improve rural broadband access but do it in different ways. Additionally, separate to the policies itself, there is also some controversy in the order the bills were signed which is currently under review by the Secretary of State’s office.

HB 1336 and SB 5383 differ in the authority that is granted to Public Utility Districts (PUD) and Port Districts to offer internet service directly to consumers. Many PUDs and Port Districts already have networks built for their power delivery services. However, while HB 1336 allows a PUD and Port District to compete with internet service providers, SB 5383 only allows the PUD or Port District to offer services if an internet provider is unwilling or unable to provide services. In the case where a PUD or Port District is offering internet services and a retail internet provider begins to offer service (effectively making the area no longer underserved), under SB 5383 the PUD or Port District has to stop offering internet service.

SB 5383 also has requirements to qualify service demand before and a new reporting requirement to justify the PUD or Port District offering the service when no other internet provider is able to.

The PUD or Port District has an advantage over retail internet providers as the infrastructure the communications network is built on, is funded by taxpayer dollars. A private company has to invest heavily in building a communications network before one consumer connection can be made.

SB 5383 offers a reasonable compromise to allow underserved end consumers to get access to high-speed internet until there is enough demand to support an internet provider offering the service directly.

HB 1336, however, creates a government funded internet service which will result in duplication of staff and services and costing the taxpayer more money. Additionally, HB 1336 gives authority to towns, cities and counties to directly provide internet services to consumers which will effectively use taxpayer dollars to build the network infrastructure. As with all monopoly situations, the municipality providing the service will have an unfair competitive advantage over private companies, eventually pushing them out of the market. Without competition, prices will rise in the long term.

A preferable solution to a PUD or Port District offering internet connectivity directly, would be for the PUD or Port District to lease the network to an internet provider in a competitive bid scenario and allow an internet provider to offer services on those leased lines. This is a possible scenario under both bills (but needs additional rule clarification) and avoids both the PUD or Port District having to hire network administration staff and the retail internet provider from building duplicative network infrastructure in many rural deployments.

Underutilized PUD and Port District networks are a solution for underserved areas to gain access to highspeed broadband internet, but it needs to be carefully regulated to prevent a government run internet service and all the duplicative costs, monopoly and privacy concerns that such a service would raise.