Special Interim Committee on Broadband Development January 2022 January 5, 2022 Rob Yescovo, Speaker House of Representatives State Capitol Building Jefferson City, MO 65 IO 1 Dear Mister Speaker: The Special Interim Committee on Broadband Development has met, taken testimony and concluded its review. The below listed committee members are pleased to submit the attached report: Represcntatt e es Rogers /'1..::--- /J _.,. ~&w.6 ( p!/£/f Representative Travis Smith - Sincerely, Representative Louis Riggs Committee Chairman 2 SPECIAL INTERIM COMMITTEE ON BROADBAND DEVELOPMENT Table of Contents Introduction and Summary of Public Testimony…………………………………………….4 Chapter 1: Access……………………………………………………………………………9 Chapter 2: Speed…………………………………………………………………………….10 Chapter 3: Affordability……………………………………………………………………..11 Chapter 4: Digital Literacy and Inclusion…………………………………..……………….12 Chapter 5: Emerging Trends……………………………………..………………………….13 Chapter 6: Accountability…………………………………………………..……………….14 Chapter 7: Online Education…………………………………………..…………………….15 Chapter 8: Telehealth………………………………………….…………………………….16 Chapter 9: Workforce Development…………………………….…………………………..17 Chapter 10: Precision Agriculture………………………………………………….………...19 Chapter 11: Economic Development/Entrepreneurship………………………….…………..20 Chapter 12: Resource Partners……………………………………………………………….21 Chapter 13: Federal Funding………………………………………………………………...23 Chapter 14: Competition…………………………………………………………....………..24 Challenges………………………………………………………………………....…………25 Findings of Fact and Recommendations…………………………………....………………. 26 Appendix Table of Contents…………………………………………………………………27 Appendix A: Links Appendix B: Committee Materials Appendix C: Supporting Materials Appendix D: Provider Materials 3 SPECIAL INTERIM COMMITTEE ON BROADBAND DEVELOPMENT Introduction and Summary of Public Testimony Speaker of the House Rob Vescovo appointed the Interim Committee on Broadband Development to investigate the status of broadband internet deployment in the State of Missouri in 2021, to conduct public hearings in Jefferson City, to conduct town hall meetings across Missouri, to take written testimony, and to prepare a report covering every facet of the importance of increasing broadband internet access across the entire State of Missouri. At the conclusion of this process, Speaker Vescovo requested recommendations for legislative and fiscal action that would ensure that all Missourians have access to broadband internet resources. The members of the Committee included Representatives Louis Riggs (Chair), Cyndi Buchheit- Courtway, Bishop Davidson, Travis Fitzwater, Jay Mosely, Wes Rogers, and Travis Smith. Each member assisted with at least one town hall meeting in addition to their regular duties. The lack of access to Broadband (high-speed) internet in much of rural America has been compared to the lack of access to electricity in rural American in the 1930’s, when many utilities refused to provide electricity to areas that deemed “unprofitable.” As of the date this report is released, Missouri is ranked 32nd in the United States in terms of access. With an estimated 150,000 households unserved/underserved based on data released by the Federal Communications Commission (FCC) in 2020, that is nearly 400,000 Missourians who do not have access to State-minimum 25/3 speeds at a time when the Federal government is increasing the minimum speeds it will fund to 100/20 (with 100/100 serving as the new benchmark). Within the last three years, Missouri was ranked as low as 49th in speed. While Missouri has seen some progress, moving from 41st in access to 32nd due in some measure to the influx of funds from Connect America Fund (CAF II) funds, the USDA, and the US Department of Commerce, as well as significant expenditures from the State of Missouri Broadband Fund, there is still a tremendous amount of work to do in order to move Missouri from below the middle of the pack into the Top 10 states in the country. As of this writing, Missouri ranks 44th in terms of home use of fixed broadband (64.6% in Missouri, national average 70.8%), 44th on reliance on cellular data for internet (14.4% in Missouri, national average 11.8%), 11th on reliance of satellite internet (8.3% in Missouri, national average 6.5%) and 15th for households with no internet access at all (15.0% in Missouri, national average 13.4%). As we approach 2022, none of these numbers is particularly encouraging and all demonstrate significant room for improvement across Missouri. Much of the attention to gaps in broadband coverage has been focused on Missouri’s Rural areas, again with ample justification. The major problem for Rural Missourians is lack of access itself. However, the broadband “digital divide” is not limited to Rural areas. The Interim Committee has heard significant testimony that the digital divide is also acute in Missouri’s urban cores as well as in many suburban areas where the obstacle to broadband access hinges on the issue of affordability as well as physical access, particularly in low-income housing developments. Data from Pew Research Center identified household income as the primary determinant whether a household has a broadband connection. Some 57% of households making less than $30,000 per 4 SPECIAL INTERIM COMMITTEE ON BROADBAND DEVELOPMENT year and 74% of households making between $31,000-$49,999 per year have access in the home. In contrast, 98% of households with more than $75,000 have access in the home. One of the key take-aways of the COVID-19 situation is that online education access is a critical issue in every area of the State of Missouri, from the smallest Rural K-8 district to the largest urban and suburban school districts. School districts deployed thousands of wi-fi “hot spots” across the State of Missouri, with decidedly mixed results. Far too many students found that they could not make the hot spots work because they did not have a sufficient cell phone signal to activate the hot spots to begin with, rendering thousands of tablets issued to bridge the gap between in-seat and online classes completely useless. Another key takeaway of the COVID-19 situation is that far too many Missouri senior citizens were unable to access remote medical services, known as “Telehealth,” for a variety of reasons, including lack of bandwidth to enable Zoom and other technologies to work in their homes, but also due to lack of knowledge regarding operations of the computers in their homes. Significant testimony regarding the lack of digital literacy also points to a barrier to broadband adoption that has not been addressed in a meaningful sense at the statewide level in Missouri. Testimony heard by the Committee also points to significant broadband-related barriers to workforce development as well deployment of precision agriculture resources using GPS technology. With the acceleration of the Internet of Things (IoT) and work from anywhere (WFA) remote workforces across the United States, now is the time to take significant steps to bridge the digital divide in Missouri once and for all. Additional testimony concerned the negative impact that the Federal government has had on broadband development across the State of Missouri. The Federal approach has been based on deeply flawed premises, starting with using census block methodology that “checks the box” that every person within a census block is served if one household is served, a fallacy that affects hundreds of thousands of Missourians. The second deeply flawed premise is that the FCC maps that are used to determine those who are served, underserved and unserved are based on voluntary data furnished by providers that populate maps that are obsolete the moment they are released and do not accurately reflect the reality on the ground in real time. The third premise is that by shoveling huge sums of money into a reverse auction process that exalts quantity over quality, much of the Federal funding has been wasted on “solutions” that not only do not solve problems, they exacerbate existing digital gaps because many areas are deemed “served” have no semblance of universal access to Broadband (high-speed internet) whatsoever. On the plus side, the Missouri Broadband Fund has been praised for its effective challenge process as well as its nearly 7:1 return on investment using matching funds that has attracted significant follow-on capital. The flexibility and responsiveness of the Missouri Broadband Office has also received high marks, administering matching fund grants as small as $25,000 using community standards instead of census block methodology to better reflect reality on the ground compared to the federal approach. The Parson Administration has signaled its willingness to invest a significant portion of Missouri’s American Rescue Plan Act (ARPA) funding to broadband internet, a most welcome development in 2022 and immediately thereafter. 5 SPECIAL INTERIM COMMITTEE ON BROADBAND DEVELOPMENT Meetings were held around the state as part of the fact-finding responsibilities of the Interim Committee on Broadband Development. These meetings were coordinated and hosted both by members of the committee and other state officials with the intention to engage stakeholders and providers in a discussion regarding various broadband issues facing a particular region. The dates and locations of these meetings are listed below: • 6-11-21 Palmyra: [No recording available] o Host: Rep. Louis Riggs, Rep. Greg Sharpe, Rep. Ed Lewis, and Rep. Danny Busick • 7-26-21 Independence o Host: Rep. Wes Rogers o Participants: Rep. Doug Richey, Rep. Emily Weber, Rep. Bill Kidd, and Rep. Ashley Aune • 7-28-21 Perryville o Host: Rep. Cyndi Buchheit-Courtway o Participants: Rep. Rick Francis, Rep. Dale Wright, and Sen. Elaine Gannon • 8-9-21 Springfield o Host: Rep. Bill Owen and Rep. Bishop Davidson • 8-10-21 Ava o Host: Rep. Travis Smith o Participants: Sen. Karla Eslinger • 8-17-21 Hazelwood o Host: Rep. Jay Mosely o Participants: Sen. Angela Walton Mosley • 8-24-21 Ashland o Host: Rep. Travis Fitzwater o Participants: Sen. Mike Bernskoetter • 9-10-21 Albany o Host: Rep. Randy Railsback o Participants: Rep. J. Eggleston, Rep. Dean Van Schoiack, Sen. Dan Hegeman • 9-24-21 St. Louis, HSSU o Host: Rep. LaKeySha Bosley • 9-27-21 Poplar Bluff o Host: Rep. Hardy Billington, Rep. Darrell Atchison o Participants: Sen. Holly Rehder • 10-28-21 Eminence: [No recording available] o Host: Rep. Bennie Cook, Rep. Ron Copeland Additionally a Northeast Missouri Broadband Steering Committee was created to address broadband issues in that region of the state. • 11-3-21 • 11-18-21 • 12-28-21 6 SPECIAL INTERIM COMMITTEE ON BROADBAND DEVELOPMENT The following providers and organizations supplied testimony before the Interim Committee on Broadband Development during its committee hearings in Jefferson City: • 6-10-21 o MO Department of Economic Development – Timothy Arbeiter (Director of the Office of Broadband Development) • 7-20-21 o The Pew Charitable Trusts – Kathryn de Wit (Project Director – Broadband Access Initiative) and Anna Read (Senior Officer – Broadband Access Initiative) o Association of Missouri Electric Cooperatives (AMEC) – Caleb Jones (CEO) and Co-Mo Electric, Ralls County Electric, SEMO Electric o Farm Bureau – Garrett Hawkins (President) • 8-16-21 o University of Missouri System - Marshall Stewart – Vice Chancellor for Extension and Engagement & Chief Engagement Officer o Google Fiber – Peter Cunningham (General Manager) o Ameren o AT&T – Christopher Pickel (Regional Director, External Affairs) o LUMEN/Century Link – Claudia Sands (Government Relations Manager) o Bluebird Network – Michael Morey (CEO) o Socket Telecom - Matt Kohly (Director of Carriers Relations and Government Affairs) o City of Kansas City - Melissa Kozakiewicz (Assistant City Manager) o Chariton Valley - Kirby Underberg (President & CEO) o Wisper Internet – Shannon Shores (Vice President of Sales and Marketing) and Chris Sigley (Chief Technology Officer) • 9-16-21 o Missouri Cable Telecommunications Association (MCTA) – Andy Blunt (Executive Director) o Charter/Spectrum - Mike Lodewegen (Senior Manager, Government Affairs) o American Public Power Assoc. - Joy Ditto (President) o MPUA, City Utilities of Springfield, Marshall Municipal Utilities, City of Houston o Coalition for Local Internet Choice (CLIC) o Bollinger County Library – Eva Dunn (Director) o Von Technologies - Michelle Vondrasek (President) o MO Chamber of Commerce – Kara Corches (Vice President of Governmental Affairs) o MO 911 Service Board - Brian Maydwell (Executive Director) o MoreAble o KCFiber – Aaron Wendel (Managing Partner) o Kingdom Telephone Company, Green Hills Communications, and Mark Twain Telephone Company • 10-18-21 o FFA - Marie Davis (NE District Supervisor in Agricultural Education and MO FFA) 7 SPECIAL INTERIM COMMITTEE ON BROADBAND DEVELOPMENT o MO Department of Higher Education – Zora Mulligan (Commissioner) o MO Department of Elementary and Secondary Education – Dr. Margie Vandeven (Commissioner) o Ralls & Shelby County Presiding Commissioners – Wiley Hibbard (Ralls) and Glenn Eagan (Shelby) o MO Municipal League – Richard Sheets (Executive Director) o UM System Telehealth Network – Rachel Mutrux (Senior Program Director of Telehealth) o BNSF Railway – Jeffrey Davis (Director of Government Affairs) o MACOG – Doug Hermes (Statewide Planner) o Meramec Regional Planning Commission - Bonnie J. Prigge (Executive Director) o Intelligent Community Forum – Louis Zacharilla (Co-Founder) o LTD Broadband – Haley Tollefson (Marketing Director) o Health Forward Foundation – McClain Bryant Macklin (Director of Policy and Strategic Initiatives) o Kansas City Public Library – Carrie Coogan (Deputy Director for Public Affairs & Community Engagement) o Fortinet o MO Developmental Disabilities Council – self advocates o Motorola o S2K Tech – Day Veerlapati (CEO) o Microsoft – Vickie Robinson (General Manager, Microsoft Airband Initiative) o Satellite Broadcasting & Communications Association (SBCA) – Steven Hill (President) o SSM Health – Sue Kendig (Women’s Health Integration Specialist) o BJC Medical Group – Dr. Michele Thomas o AARP – Jay Hardenbrook (Associate State Director – Advocacy) • 11-22-21 o AgriExperts - Keith Eisberg and Abner Womack o MO MODOT - Eric Schroeter (Assistant Chief Engineer) o MO Department of Agriculture – Chris Chinn (Director) o MO DED – Timothy Arbeiter (Director of the Office of Broadband Development) 8 SPECIAL INTERIM COMMITTEE ON BROADBAND DEVELOPMENT Chapter 1: Access Missouri is currently ranked 32nd in the United States in terms of access, an improvement from 41st in access within the last three years. That is a significant improvement, but as mentioned in the introduction, Missouri lags behind the rest of the United States in every key factor that determines meaningful broadband access. The General Assembly enacted a state standard of minimum 25/3 access in 2018 through H.B. 1872. This was based on the Federal standard announced by the FCC in order to determine eligibility for Federal funding as discussed previously. In 2021, ARPA guidelines announced a new recommendation (not yet a requirement) of 100/100 speeds, with approval of 100/20 when 100/100 was not practical. The Missouri General Assembly also enacted a ‘hierarchy’ of needs in 2018 to determine who was served and who was not: 10:1 or less speed is classified as “unserved,” 10:1-25:3 access is “underserved” and anything above 25:3 is deemed “served.” It is reasonably foreseeable that the Federal standard will only increase from this day forward, rendering existing statutes and standards obsolete (as will the march of technology itself). As mentioned previously, physical access remains a barrier to deployment in Rural areas (also commonly classified as ‘last mile access’). As of this date, 15% of all Missouri households have zero access at all. Currently 66,583 households or about 177,617 people fall into unserved/underserved census blocks. An assumption can be made that the Federal standard will be increased, with “unserved” reclassified as no service but not quite 25/3, “underserved” reclassified as above 25/3 but not quite 100/20, and “served” reclassified as above 100/20. Based off the December 2020 FCC data and 2010 Decennial Census information, reclassifying these definitions would place 362,967 households or around 948,853 people in the unserved/underserved category—a quantum leap backwards on the heels of Federal funds being plowed into technologies that only provided 10/1 and then 25/3 standards over the last decade. It is also reasonably foreseeable that the Federal government will continue to “move the goalposts” regarding sufficient broadband access, and Missouri must be in a position to move forward as a result. Fortunately, the preferred method of building out broadband resources, fiber to the home (FTTH) is already future-proof and its providers will be able to keep pace with increasing Federal standards as well consumer demand for higher speeds. 9 SPECIAL INTERIM COMMITTEE ON BROADBAND DEVELOPMENT Chapter 2: Speed As late as 2018, Missouri was ranked 49th in the nation for internet speed. While that number has improved along with overall access, speed remains a significant challenge across Missouri. Advertised rates mention the words “Up to,” but all too often real speeds measured in real time fall far short of the advertised rates. Another takeaway that no one saw coming from the COVID-19 situation was the lack of resiliency in the system itself. At one point during the period when Missouri students were sent home to learn remotely, business owners across the state noticed slower internet speeds than usual in populated areas. According to the Department of Economic Development, at any given moment, 40-45% of all available bandwidth in the State of Missouri was being soaked up Netflix and YouTube. In the event that remote learning should take place again on such a scale, the lack of available bandwidth will prove an obstacle to normal business operations again. In order to more accurately gauge the real speeds being used, other states have incorporated maps that demonstrate real-time usage through various means, including state-operated websites. The University of Missouri-Columbia has such a feature available today through the Missouri Resource Rail. There is no Federal equivalent to this and the FCC coverage maps in current use are appallingly inadequate in terms of accurate information as well as out of date. West Virginia currently uses a map that provides real-time data that is administered through the auspices of its Broadband Enhancement Council. Due to the deficiencies inherent in the Federal approach, it has become evident that Missouri needs to provide its own mapping resources to provide a clear picture of not only where broadband resources are located, but also what speeds are routinely being delivered across the state. Site Selectors choosing to bring businesses to different states use “desk-top eliminations” to decide whether or not to proceed further with their inquiries. One of the first eliminations is based on lack of sufficient internet. While communities like Houston and North Kansas City have introduced city-wide broadband services and Hannibal has pursued “100 Gig” certification to differentiate themselves from other communities to attract new businesses, the entire state could be pursuing similar distinctions with sufficient mapping resources that reflect actual speeds. North Kansas City at this moment offers free residential internet to most of its residents and its businesses have access to some of the fastest broadband internet speeds in the world. The net result has been a business boom that any community in Missouri could replicate. 10