Private companies complain that a broadband grant to the UW system is unfair for competition.

**Update: Wisconsin state legislators have backed off their controversial plan to cut $37 million in federal broadband money from the University of Wisconsin system amid sharp protest from the state’s schools. For details, see here.**

A federally funded effort to expand broadband service in Wisconsin is in jeopardy because some state officials don’t think the recipient of the grant, the University of Wisconsin (UW) system, should get the money. The grant to a public university makes it harder for private companies to compete in delivering broadband service, they say.

Area lawmakers from both parties are voicing concerns over a provision added to the proposed state budget to strip federal stimulus funding from a project to build telecommunications infrastructure—including high-speed, broadband internet cables—in the Chippewa Valley and elsewhere in Wisconsin.

But the leader of a Wisconsin-based firm that represents dozens of telephone companies applauds the move, saying it will prevent UW-Extension from competing with private telecommunications companies.

UW-Extension planned to use the money to fund its Building Community Capacity through Broadband, or BCCB, project. That project would have let UW-Extension plant cables and build other communications infrastructure in parts of the state to link government offices, libraries, schools, and medical centers.

“We all know that having that infrastructure of broadband capabilities is like having water, is like having roads. If you don’t have it, you’re losing stride with the rest of the world,” said Maria Alvarez Stroud, a UW-Extension employee in charge of the project.

The National Telecommunications and Information Administration, or NTIA—a Commerce Department agency chiefly responsible for advising the president on telecommunications and information policies—last year awarded UW-Extension $32.3 million in federal stimulus money to expand broadband communication technology in parts of Wisconsin that don’t have it.

Most of that funding came in a $29.9 million grant to build communications infrastructure in parts of Wisconsin—including in Chippewa, Dunn, and Eau Claire counties.

A roughly $2.4 million grant would have helped UW-Extension conduct educational campaigns across the state to teach about the benefits of broadband.

But earlier this month the Joint Finance Committee, the Legislature’s budget-writing panel, on a party-line vote—the committee has 12 Republicans and four Democrats—passed an amendment 12-4 that would prohibit the UW System or UW-Extension from “receiving funds from any award” from the NTIA to support the BCCB project.

Mark Weller, president and CEO of Madison-based Access Wisconsin, which represents the interests of about 30 private telephone companies, applauded the amendment.

“We take great offense at the idea that taxpayer money should be used to subsidize a government agency such as UW-Extension to duplicate and compete with our services,” Weller said June 7 in a written statement. “This is wasteful and inappropriate.”

State statutes bar the UW System Board of Regents from providing telecommunications services “that are available from a private telecommunications carrier to the general public or to any other public or private entity,” Joint Finance pointed out in the amendment.

State Sens. Terry Moulton, R-Lake Hallie, and state Sen. Kathleen Vinehout, D-Alma, both criticized the amendment, saying the BCCB project would connect agencies in rural parts of the state where broadband isn’t offered by the private sector.

“It simply defies reason,” Vinehout said of the amendment.

The same amendment also would prohibit the UW system, individual campuses, and UW-Extension from partnering with nonprofit organizations that provide “telecommunications services or information technology services to members of the general public.”

That effectively would sever the UW System’s membership with WiscNet, a nonprofit association that provides internet access and other network services to member organizations in Wisconsin.

WiscNet members include public entities such as schools, libraries, universities, and local governments. Area members include the Altoona, Chippewa Falls, Eau Claire, and Menomonie school districts; Eau Claire city and county governments; and UW-Eau Claire, UW-Stout in Menomonie, and Chippewa Valley Technical College.

WiscNet operates as a cooperative, meaning members pool money to pay for services. That helps keeps service costs low, said David Lois, WiscNet’s executive director. The amendment’s impact on his organization would be “devastating,” Lois said.

The UW System is a “key member” of WiscNet, Moulton said June 9. Pulling the university system out of the organization, he added, would be like pulling a major store out of a shopping mall: “WiscNet would be probably unable to survive without [the UW system’s] inclusion.”

In a memo last week to schools and libraries in Wisconsin, state schools Superintendent Tony Evers said the amendment “will very likely make it impossible for WiscNet to continue offering internet access.”

Evers said many of Wisconsin’s public schools and libraries get their internet access through WiscNet. Costs for schools and libraries to get internet access likely would double or triple if WiscNet disappeared, Evers said.

Bob Scidmore, the Eau Claire school district’s technology director, said June 9 that the district still was trying to verify how much it would cost to get internet service through another provider. If costs did in fact double or triple, he said, the district likely would have to spend between $21,000 and $42,000 more each year for its internet service.

Vinehout said the decision isn’t final and could be removed from the budget before it is approved. The Legislature is expected to start debating the 2011-13 budget this week, and it isn’t final until passed by both houses of the Legislature and signed by Gov. Scott Walker. It takes effect July 1.

Moulton said he has been working to get the measure out of the budget. He’d like the Legislature to discuss the issue more before acting on the BCCB project.

“I think it would be a shame to not be able to have that federal money to expand broadband services in rural areas,” Moulton said, noting the BCCB project likely would create jobs in the Chippewa Valley.

Walker spokesman Cullen Werwie said June 9 in an eMail message to the Leader-Telegram of Eau Claire that Walker would “evaluate those specific provisions once the final version of the budget” reaches his desk.

Project backers are urging lawmakers and Walker to strike the provision.

“Broadband is a critical health-care infrastructure that reduces costs, improves patient outcomes, and expands quality and accessibility for patients,” officials from Hospital Sisters Health System wrote in a June 7 letter to Moulton.

Illinois-based Hospital Sisters operates Sacred Heart Hospital in Eau Claire and St. Joseph’s Hospital in Chippewa Falls, as well as hospitals in Green Bay and Sheboygan. Officials said the amendment would destroy a planned broadband connection among its hospitals.

The Chippewa Valley Internetworking Consortium is a community area network that connects municipalities, libraries, educational institutions, and nonprofit medical centers in the region. It sent a letter to Walker last week urging him to remove the amendment’s provisions from the budget.

“These provisions are perplexing because they have no clear purpose in advancing your budget goals or your goal of adding jobs,” Ross Wilson, a fiscal agent for the consortium, wrote in the letter.

Besides the federal grants, UW-Extension also received financial contributions to fund the project from other sources, including a private company that had partnered with UW-Extension to lay cables once the project got under way. Contributions also came from the state Department of Transportation, schools, and cities, said Stroud, the UW-Extension employee in charge of the BCCB project.

Stroud said the goal ultimately was to lay hundreds of miles of cables from Superior to Wausau, running through Eau Claire. Cables also would have run from Platteville to the Madison area.

“It puts a halt to so many things,” Stroud said of the amendment, noting that without the federal funding, the project almost certainly will grind to a stop.

Calls to several Joint Finance Committee members who voted in support of the amendment were not returned last week.

Copyright (c) 2011, The Leader-Telegram, Eau Claire, Wis. To see more of The Leader-Telegram or to subscribe to the newspaper, go to http://www.leadertelegram.com. Distributed by McClatchy-Tribune Information Services.


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