Broadband for All – The Need for a Communications Union District

Broadband for All – The Need for a Communications Union District

By Dr. Michael Shank

On the Rutland Regional Planning Commission, where I serve as the Vice-Chair of the Regional Board of Commissioners, the issue of broadband service throughout Rutland County is front and center. It’s an urgent priority for us, especially as COVID-19 has moved even more work, communication and education online.

There’s been a lot of discussion among State Senate candidates, as there should be, about the need for better broadband throughout Rutland County. In fact, everyone should be talking about this.

Our communications infrastructure isn’t sustainable. My internet service at my rural farm isn’t reliable, for example, and it’s incredibly frustrating given that my work with cities around the world and my graduate school teaching depend on reliable internet.

If we want our students, self-employed, small businesses, first responders and medical workers, farmers, and anyone else working remotely, to be successful, we must do better at ensuring that everyone has reliable access to internet service.

Too many places in Rutland County still don’t have reliable internet. How can a student succeed in that environment? How can a small business, operating out of the home, succeed in that environment? How can a start-up thrive in that environment? They can’t.

We need more competition, we need more providers, and we need this to be a priority for every elected official who cares about the future viability of Vermont businesses, educators and innovators.

This should be a priority for every elected leader in Rutland County. The map above (and linked here) says it all. We need broadband for all. In this digital economy, it’s as essential as any other utility.

Thanks to my Town of Brandon’s leadership, a new Otter Creak Communications Union District is being formed now. This gives us leverage in getting broadband for all. It’s exciting and necessary and what I’ll continue to push and promote and implement for all of Rutland County as state senator.

So that everyone has all the information they need on next steps, I’m appending an important Q&A from Vermont’s Department of Public Service.

Check it out and get involved.

COMMUNICATIONS UNION DISTRICTS

FAQ

  1. What is a Communications Union District (CUD)
  • A CUD is a Communications Union District, allowing two or more towns to bond together as a municipal entity for a means of building communication infrastructure together. For more information see Title 30: Public Service, Chapter 82: Communications Union Districts.
  • Other types of municipal districts include Solid Waste Districts, Consolidated Sewer Districts, Emergency Medical Service Districts, Natural Resources Conservation Districts, and Consolidated Water Districts.
  1. Is there a map of current Communications Union Districts (CUDs)?
  1. What are some reasons for creating a CUD?
  • Aggregate demand – Mixing dense and less dense towns makes the project more attractive to providers (with more negotiating power for the CUD).
  • The entire region can benefit rather than creating a digital divide with town-by-town buildout by different carriers.
  • Efficiency – Network design, construction, and operation can all be more efficient when planned together from the onset.
  • Risk mitigation – Individual towns are not on the hook.
  • Additional funding opportunities – Easier access to federal and state grants and loans that require providing services to those least served.
  1. How are CUD boundaries determined?

This is what our Broadband Innovation Grant funded feasibility study will assess:

  • What is the critical mass? You need people, area, subscribers; more towns = increased negotiating power.
  • Topography and geography – Are towns connected by roads?
  • What is the most efficient group size (number of representatives) for the CUD?
  1. What is the cost to the taxpayer and town in order to be part of a CUD?
  • Neither the taxpayer nor the town is required to pay anything in relation to a CUD. Section 3056(a) of Title 30states that the “district shall not accept funds generated by a member’s taxing or assessment power.” This means that a CUD cannot accept funds derived from a local options tax to finance a CUD. A CUD must fund its operations by bonds backed by the revenue derived from the project, grants, or gifts.
  1. Can a town use funds derived from taxes to pay for any expenses incurred by or in support of a CUD, including feasibility studies, cost assessments, legal counsel retention, grants, build-out or make-ready costs?
  •  A CUD, as a municipal organization, must obtain funding via grants, gifts, or loans backed by revenues derived from the operation of the CUD or the CUD itself.  See 30 V.S.A. § 3056for more detail.
  1. Is the taxpayer or town liable for CUD losses or insolvency?
  • CUDs are obligated to ensure that any and all costs related to revenue losses or curtailment or abandonment of services are not borne by the taxpayers of CUD members
  1. If tax dollars cannot be used to fund the launch of a CUD, how can the CUD be initially funded?
  • The CUD can be initially funded with revenue bonds, loans, grants, gifts or any source of funding not generated by a member’s taxing authority.  Loans must not be backed by anything other than revenues derived from the operation of the CUD or the CUD itself.  See 30 V.S.A. § 3056for more information.
  1. How does a town join a CUD?
  • Currently and for a limited time only during the COVID-19 State of Emergency, a CUD can be created through a selectboard vote of at least two towns. A town meeting vote is not required. See Act 119. Under normal conditions 30 V.S.A. § 3051 and 30 V.S.A. § 3082 would apply.
  1. Can a town withdraw from a CUD?
  • In order to withdraw, the CUD member must publicly warn its voters of its intention to withdraw and subsequently hold a vote. A CUD member can only withdraw if a majority of its voters vote to withdraw from the CUD. The vote must be held at an annual or special meeting of the town or city. The town member must then give other CUD members notice of the vote to withdraw and hold a meeting to determine if it is in the best interest of the CUD to continue operating. Another vote by the CUD must then be held to either withdraw the town member or dissolve completely. See 30 V.S.A. § 3081for more information.
  1. Can a town apply a special assessment to finance a build for the town?
  • A special assessment can be used to fund a CUD only ifit will serve a limited area of the town. In other words, if the entire town will be served by the CUD, a special assessment cannot be used. Furthermore, any tax or assessment on property requires advanced authorization of the General Assembly. See 30 V.S.A. § 3056 (b) for more information.
  1. How does a CUD operate?  Are there examples of bylaws?
  • A CUD is a municipal organization.  Each town sends a delegate or an alternate to meetings of the CUD.  Operating procedures and powers are detailed in 30 V.S.A. Chapter 82.