To the Members of the Tennessee General Assembly,
On behalf of National Taxpayers Union’s (NTU) Tennessee members, I strongly urge you to reject SB 1134 and HB 1303. These calamitous bills would expand the scope of failed government-owned networks (GONs) in the Volunteer State. Taxpayers deserve better.
As the dreadful history of GONs demonstrates, these schemes almost always fail to live up to supporters’ expectations. A 2014 study by New York Law School found these networks often cost significantly more to build and operate than initial projections. The same study found that Chattanooga’s publicly-owned Electric Power Board’s GON has accumulated nearly $430 million in debt. Other studies have shown 70 to 80 percent of GONs fail to ever make a profit and several cities have sold their networks at huge losses.
The private broadband market is highly competitive. As a result, it has largely produced good quality service at affordable rates. When government competes with the private sector, taxpayers are usually stuck with the tab. The networks created pursuant to SB 1134 and HB 1303 would be no different. Simply put, creating broadband networks is not a legitimate function of government. Accordingly, NTU encourages you to defeat the ill-conceived ideas encapsulated by SB 1134 and HB 1303.
Sincerely,
Clark Packard
Policy and Government Affairs Manager