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Lawmakers consider bill providing additional oversight to broadband deployment

Delegate Daniel Linville, R-Cabell, introduced a bill to provide more oversight for the new Department of Economic Development and hold internet service providers accountable. (Photo Provided)

CHARLESTON — Hoping to not make the same mistakes as the past when it comes to broadband expansion, lawmakers are looking at a bill that will give them more oversight and say in how the state spends its broadband and economic development dollars.

House Technology and Infrastructure Committee Chairman Daniel Linville, R-Cabell, is the lead sponsor of House Bill 4001. His committee learned more about the bill Monday afternoon. HB 4001 would create the Legislative Oversight Commission on Department of Economic Development Accountability.

The new commission would consist of 14 members from the House of Delegates and state Senate from all committees dealing with infrastructure and economic development, with Senate President Craig Blair, R-Berkeley, and House Speaker Roger Hanshaw, R-Clay, as non-voting members.

The goal of the commission would be to provide oversight for all financial investments made by the Department of Economic Development, the new state agency created last year out of parts of the Department of Commerce and led by former senate president Mitch Carmichael. The commission would create a line of communication between the Legislature and the department as it prepares to spend millions of mostly federal dollars on broadband expansion projects across the state.

“From a policy perspective, we want to make sure those policies that we attempt to put into place are being followed through upon, and that we keep the dialogue open between the executive branch and the legislative branch all throughout the year on these initiatives,” Linville said in an interview prior to Monday’s meeting.

The Legislature already has joint oversight commissions for the Department of Education, the Department of Health and Human Resources, and the Department of Transportation – all agencies that received millions of state taxpayer dollars and federal funding.

With the Department of Economic Development already receiving millions in federal funds and state dollars for major manufacturing projects, Linville said it only made sense to create a new oversight commission.

“First and foremost, we want to make sure the dollars we’re deploying are done well,” Linville said. “The department was created last year and most other departments do have a legislative oversight commission that is tasked with overseeing and protecting and balancing the work they’re doing. We proposed creating that, because certainly there is a very significant amount of dollars that are going there.”

The Legislature passed several bills during a two-day special session last week prior to the start of the 2022 60-day legislative session Wednesday, including a new set of tax breaks aimed at large manufacturing companies that require more than 200 workers.

Lawmakers transferred $315 million to the Department of Economic Development to use as matching funds for the proposed Nucor steel mill project in Mason County. Those funds were taken from other state agencies, who will be reimbursed with federal COVID-19 funds from the American Rescue Plan. The project would create as many as 1,000 new construction jobs over two years, with 800 full-time jobs once the mill is completed, resulting in a $2.7 billion investment.

Another $15 million was transferred to the department from surplus tax dollars for a project between West Virginia University Health System (WVU Medicine) and Owens & Minor Inc. for a new health care products preparedness center. The project would create over 125 jobs and represent about $50 million investment in the state.

West Virginia is set to receive $138 million for broadband expansion through President Joe Biden’s American Rescue Plan. The state can also use part of the $1.355 billion it’s receiving through the American Rescue Plan for infrastructure projects, such as broadband expansion. And Under the Infrastructure Investment and Jobs Act passed by Congress in November, West Virginia will receive at least $100 million broadband coverage.

These federal investments don’t include the more than $362.1 million awarded to nine internet service providers in West Virginia for Phase I of the FCC’s Rural Digital Opportunity Fund auction, or the federal funding through the FCC’s Connect America Fund phases and the various grants and loans through the Appalachian Regional Commission and the U.S. Department of Agriculture.

The Department of Economic Development and its State Broadband Office launched a number of programs since last year to capitalize on all of these funds in order to expand broadband to unserved and underserved areas, expanding last-mile broadband projects, “dig once” policies and opportunities to install fiber on state rights of way, accurate mapping of broadband services and public-private partnerships with internet service providers.

Aside from creating the oversight commission, HB 4001 also creates a number of funds to invest dollars for various broadband programs, such as middle mile broadband expansions, pole replacement and relocation, conduit installation and right of way mapping.

“House Bill 4001 is our next effort in further expanding broadband and enhancing the broadband that people currently have, as well as protecting the consumer,” Linville said. “One of the things we’re doing from a funding standpoint is creating the buckets we can put money into … These can be unexpected costs and we want to make sure they’re accounted for.”

The bill also includes additional consumer protections, and a requirement for telecommunications companies that offer internet service to apply for “eligible telecommunications carriers status” with the Public Service Commission to show that the companies are in compliance with the FCC’s Universal Service Fund. The bill empowers the state Office of Broadband to check with the FCC to determine any specific commitments and obligations made by companies regarding broadband and require companies to meet those obligations.

“The state has that option to be the one to issue that status to any provider in the State of West Virginia,” Linville said. “In the past, we’ve largely relied upon the FCC to do so. It’s one more avenue we have to hold providers accountable in order to participate in those programs.”

The bill empowers the PSC to fine any company that misrepresents their compliance once a hearing is conducted. Companies would also be ineligible for future state grants.

“The bill seeks to hold providers accountable such that if they’re not going to keep their promises, they’ll no longer be able to participate in those programs both from a state and federal level,” Linville said. “If they lie to us after taking these grant dollars, this is essentially the provider death penalty.”

HB 4001 will be taken up by the committee at a later date.

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