A long-shelved city broadband plan is rising from the dead in Lakeland, Florida, with city commissioners pondering a property tax increase that would help fund a nearly $100 million network.
City Commissioner Justin Troller, who will leave office next year, has been aggressively pushing the issue in recent commission meetings, proclaiming he will “be a champion of this issue as long as I have breath in me.”
He said at the most recent meeting that a 0.5 millage increase in property taxes for Lakeland residents over the next seven years would yield the $17 million the city needs to get the project started, according to The Ledger/Gainesville Sun. That tax increase would mean about $35 to $45 would come out of the average homeowner’s pocketbook, whether they chose to use the internet or not.
“It has to be a commitment from our community,” Troller said. “With that level of commitment we can show we are serious, our people are serious and they are willing to invest in the infrastructure of our community.”
But as Troller plans a series of community meetings in Lakeland over the next several months to pitch the issue, skeptics warn the city to tread carefully in pursuing the plan.
Christopher Yoo, a University of Pennsylvania law professor who released a study in 2017 that found the vast majority of government broadband projects hemorrhage money, told the Ledger that a city considering a network should “study the track record closely.”
“What we see in many examples are promises these projects will generate cash, when in the majority of cases they do the opposite,” he told the newspaper. “The best justification for building fiber to benefit your citizens is to construct it on a break-even basis.”
BroadbandNow.com, which tracks internet availability across the country, shows that Lakeland is well-covered with broadband, with Charter’s Spectrum servicing nearly every resident with download speeds of up to 400 megabits per second (mbps) and Frontier Communications covering nearly 90 percent of the city with speeds up to 30 mbps. Viasat and HughesNet cover all residents with satellite broadband.
Troller has admitted his push is largely due to dissatisfaction with the services provided by incumbent providers. He has said he expects that Lakeland could capture 50 percent of the market share. That’s despite a city survey that found only about one-third of homeowners and businesses were unhappy with their current internet provider, according to The Ledger.
Even John Honker, president and CEO of Denver-based Magellan Advisors, a company that the Taxpayers Protection Alliance Foundation has found almost never dissuades cities from building internet networks, told Lakeland leaders that sales and marketing is one of the trickier aspects of being successful in the business.
Yoo told the Ledger that this overestimation of market share is one of the great downfalls of government broadband.
“What I find, by and large, is the networks are generally well run, but the biggest problem is they don’t generate enough revenue,” he said.
Not everyone in Lakeland is gung-ho for the proposal. City Commissioner Bill Read asked Honker questions of failed government broadband projects at the August 19 commissioners’ meeting, and Mayor Bill Mutz expressed his concern that the projected cost of $97.5 million may be too low and not properly accounting for changes in technology such as the deployment of high speed 5G wireless service. He said the costs could be understated by 30 percent.
The Magellan plan calls for Lakeland to also offer phone and cable service, even as American consumers continue to largely eschew such services for cell-only and streaming options.
A 2005 Florida law generally prohibits new government internet projects, but Lakeland has a certificate to provide communications service from the Florida Public Services Commission that it obtained in 1994. Even though the designation of that certificate is for the city to create a telephone network, Troller believes Lakeland can use the document as a basis for building its own broadband network.