The House voted 115-3 to approve House Bill 366 , sending it to the Senate for more debate. The measure would allow Mississippi’s 25 electric cooperatives to form subsidiaries to offer broadband internet service. They’re currently prohibited from doing so by law.
Supporters said the bill would provide an opportunity for the state’s many rural residents to fully participate in an economy and society that assumes people have good digital access, although they warned it would take time for service to become widespread.
“They are being penalized now today because they chose to live in Mississippi in the country,” said Rep. Tommy Reynolds, a Water Valley Democrat.
The measure is sponsored by House Speaker Philip Gunn, and got the early-session push that the Clinton Republican gives to some of his priorities.
House leaders had held pre-session talks to try to smooth out concerns of private companies that offer internet service and landowners. That resulted in a bill that says cooperatives wouldn’t be required to offer internet service and couldn’t use electrical revenues to prop up their internet subsidiary. Cooperative members couldn’t be required to buy internet service and cooperatives couldn’t cut off power if someone’s behind on their internet bill.
The proposal requires a feasibility study and an annual audit and does allow cooperatives to invest money, loan money or guarantee loans to their affiliates. Cooperatives could apply for hundreds of millions in grants and loans offered by the U.S. Department of Agriculture to finance rural broadband if the measure passes.
Questions Tuesday came from another quarter, with some African-American Democrats saying cooperatives aren’t democratic enough and are holding back money that they should pay out to members. They succeeded in getting amendments requiring cooperatives to send out separate notices of elections and publish election results in a newspaper, but failed in an effort to require cooperatives to submit quarterly financial statements to the Public Service Commission. Some cooperative members are suing over the issue of money they say they’re owed.
“This amendment would put some oversight, just a little bit, on what they’re doing,” said Rep. Willie Bailey, a Greenville Democrat, speaking of the failed proposal on quarterly financial statements. The cooperatives, governed by member elections, have long resisted oversight by the three-member Public Service Commission.
One of those utility regulators, Northern District Commissioner Brandon Presley, has been a champion of rural broadband. Presley held a series of meetings statewide to build support. He downplayed arguments that cooperatives, like telecommunication companies, would conclude that rural areas couldn’t financially support high-speed internet.
“Electricity was expensive in the 1930s,” Presley said, likening the law to when electric cooperatives were created. “The same arguments you hear today you heard then. This law is going to bring rural Mississippi out of the digital darkness.”
Jason Siegfried, CEO Southern Pine Electric Cooperative, said the prospect of being allowed to offer high-speed internet service was “very exciting” and said the Taylorsville-based utility had already conducted some preliminary feasibility studies.
Siegfried said rollout could begin months after a bill becomes law, but said it would take years for the cooperative to construct facilities throughout its territory.
“There’s a lot of work to be done toward rolling out what will be a very, very capital intensive service.”
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