Watertown assemblyman urges repeal of broadband fee
New York lawmakers are pushing to repeal a controversial state broadband fee that’s disrupted several high-speed internet expansion projects across regions of rural upstate — especially as internet connectivity remains essential during the coronavirus pandemic.
The state Department of Transportation started charging fees this year to fiber-optic cable installers who build lines in a state-controlled highway right of way. The 2019-20 state budget contained language that enacted a right-of-way tax or use and occupancy fee, allowing the DOT to require installers to enter annual fee-bearing permits to charge corporations per foot, per cable for fiber-optic lines they own.
The fee does not apply to other utilities in the same area, including phone, water or sewer lines. The extra cost applies to lines constructed before the fee went into effect this year.
Assemblyman Mark Walczyk, R-Watertown, sponsors bill A10932 to repeal corresponding provisions of state highway and transportation corporations law to reduce the cost of expanding broadband access. It has remained in the Corporations, Authorities and Commissions Committee since Aug. 17.
“People are upset,” Walczyk said. “I view this tax as excessive, unreasonable and unfair. When we get back to session, whether that’s in a special session (this fall) or back in January, I hope to finally repeal this thing because it lacks common sense.”
DOT charges corporations three types of fiber-optic permit fees depending if they are underground, aerial or cross a highway right of way. Companies are typically charged when they pass through privately owned rights of way.
Fiber-optic-owning corporations in the North Country and other parts of the state are annually charged $200 per foot, per cable for up to 96 strands; $316 per foot between 216 and 431 strands; and $549 per foot for 432 strands or more when cable lines cross a highway right of way. The fee is significantly lower for aerial liens at 26 cents per feet, per cable for up to 96 strands; 42 cents per foot for 97 to 216 strands; and 80 cents per foot for 217 aerial strands or greater, according to dot.ny.gov.
Fiber-optics utility companies are prohibited from passing the new DOT fee costs to consumers.
The North Country assemblyman spoke with DOT Commissioner Marie Therese Dominguez about the legislation to repeal the fee, which was projected to raise as much as $30 million this fiscal year.
“The commissioner said, ‘I read your bill; it was very straightforward; I understand where you’re coming from,'” Walczyk recounted Friday. “We’ve made great strides with DOT, and they’ve kept an open line of communication, which I appreciate.”
The fee is based on formulas that consider the length and amount of fiber installed and location of fiber within the state, according to a statement Friday from a DOT spokesperson. Payment amounts and due dates vary based on the particular projects.
Department representatives declined to comment on the pending legislation.
Fee rates will increase by 2% each year and may be adjusted when DOT renews a permit. Fee-bearing permits are required for existing fiber optic line occupancies and new installations, according to dot.ny.gov.
Upstate New Yorkers have grappled with lacking high-speed broadband connectivity for more than a decade. Gov. Andrew Cuomo and many representatives have argued internet access is no longer a luxury but an essential utility comparable to electricity or water lines — especially as people have largely depended on working from home or attending school online during the COVID-19 pandemic.
“The governor needs to be reminded of his promise to expand rural broadband,” the assemblyman said.
Cuomo launched the Broadband For All initiative in summer 2015, investing more than $550 million through three rounds of grants to secure high-speed internet upgrades for the most rural, underserved parts of the state.
Projects funded with a state grant award through the Broadband For All program are exempt from the DOT fee. Broadband For All projects are the fee’s lone exemption.