By TRACEY GLAZENER
Capital News Service
LANSING — Taxation and government regulation issues fuel the debate surrounding broadband deployment, but some lawmakers are still not convinced of Michigan’s need or demand for increased access to high-speed computer services.
“The vast majority of my constituents would not benefit from the proposed legislation, so I feel that asking them to shoulder the financial burden is unfair,” said Sen. Alan Sanborn, R-Richmond.
Broadband services use technology that increases the rate at which a user can send and receive data, thus making the Internet easier and faster to use.
The goals of Gov. John Engler’s proposed three-bill package include leveling the playing field for telecommunications providers through uniform permit standards and fairness and creating a new state authority to work with providers to make investment in such ventures more profitable.
With those goals in mind, the package proposes a 5-cents-a-foot tax on telecommunications linesÑboth existing and futureÑto fund the project. While 4 cents would go to the local government, 1 penny out of each 5 cents collected would be used by the new state authority to fund broadband services in underserved areas.
According to Sanborn, there is no demand for increased access to broadband among his constituents, but there is apprehension over new taxes.
“My constituency put me in office, and they are not coming to me and telling me they need this,” he said. “They are more concerned about additional taxes.”
Rep. Leon Drolet, R-Macomb, supports a tax on telecommunications lines to fund broadband, but he strongly opposes the creation of a government-appointed agency to control the state’s broadband deployment.
“Everyone I’ve talked to agrees that broadband is good, and if we eliminate the barriers, broadband will flourish,” he said. “The government needs to stay out of the way and let it happen.”
The Senate Energy and Technology Committee held hearings for the high-speed Internet plan all week, and state officials hope the full Senate will be able to vote on the package next week.
Rich Studley, senior vice president of government relations at the Michigan Chamber of Commerce, attended the committee hearings and said the Chamber supports the ideas behind Enger’s proposal, but that important issues still need to be addressed.
“We support the concept of a tax-funded deployment of broadband, but we are concerned with how much it will cost and the return taxpayers will get on the investment,” he said.
As an incentive to investment, Sens.Valde Garcia, R-St. Johns, and Bill Schuette, R-Midland, introduced a bill that would provide a tax credit of 4 percent toward the purchase of telecommunications equipment for high-speed data transmission services. The tax credit would apply to expenditures for new equipment purchased only after Dec. 31.
Studley said the tax credits proposed by Garcia and Schuette are instrumental to the success of broadband deployment in Michigan.
The Chamber also has proposed alternative methods to eliminate another barrier to broadband deploymentÑover-regulation by local government. These alternatives would provide communities more freedom of choice on the need for broadband in their area.
© 2002, Capital News Service, Michigan State University School of Journalism
By TRACEY GLAZENER