Wireless Kleptocracy

If you want to put a chill to the job market and reduce economic growth, all you have to do is stop businesses from investing or make it more costly.  This is exactly what is happening in Georgia and elsewhere.

Wireless infrastructure investors are facing major roadblocks, as a number of counties and municipalities across the country have put up barriers to entry, delayed investment and extracted payments and fees that have no bearing on costs from wireless investors.  For consumers, this could mean higher prices and a poorer quality of service; for the Georgia economy, it means decreased investment and economic output; and for workers, it means fewer jobs.

Despite policies that should encourage innovation and investment, local counties and municipalities are using local zoning rules, application approvals and rights-of-way regulations are impede wireless investment in Georgia.  Some counties are prohibiting wireless companies from adding or making changes to existing wireless antennas; requiring full hearings just to upgrade an existing cell tower; and dictating the scope, size and type of facilities for investment.  Making it harder to invest makes for less investment.

But here is the catch – the delays and threatened prohibitions can be resolved with sizable payments to local governments in the form of application and permitting fees, placing moneys in escrow, and requiring payments to government consultants.  Local governments can also require that facilities be placed only on public land, which conveniently extract additional funds for years to come.  For investors, it means paying up and passing these costs along to their consumers (you) in the form of higher prices, and it means delaying services or letting the quality of services degrade.  For the local government it is a kickback, it is klepo-bureaucracy and its business as usual.

The issue is not a new one.  The Federal Communications Commission recognized the problem in 2009, when it ordered local jurisdictions to decide applications to existing infrastructure within a 90-day “shot clock” and new construction applications within a 150-day shot clock.  However, some local governments have figured out ways to delay an application process, such as arguing over the completeness of an application or requiring payments to consultants who confirm an application’s completeness before starting any shot clock.  In some local areas, a one-year delay or more in the application process is common, which is ironic since it can take only one or two months to erect a cell tower and mount an antenna.  Can you hear me now?

Companies are trying to invest in high-speed wireless services that Georgia consumers want.  These services enable Internet browsing, video services and applications like free navigation, messaging, remote medical monitoring, e-books, telecommuting, shopping and banking.  In Georgia, there are about as many wireless subscribers as there are people living in the state.  Consumers want these services and that requires investment.

It is time for state policymakers to step in, end the kickbacks and refocus on the public’s interest.  From a state policy perspective, these barriers result in real costs to businesses, consumers, workers and the Georgia economy.  With more than one billion dollars of broadband and communications investment in the state each year, that investment generates more than 12,000 jobs and it creates services that consumers want.  Even on a small scale, at about one-half million dollars per tower, that creates the equivalent of 4 full time jobs for an entire year.

President Obama has called for increasing broadband deployment, lawmakers desperately want the economy to stronger, workers want jobs and consumers want new and innovative services.  It is time for state policymakers to step in for the sake of consumers, workers and the economy.  Let’s stop these kleptocrats.

Steve Pociask is president of the American Consumer Institute Center for Citizen Research, a nonprofit educational and research organization.  For more information, visit www.theamericanconsumer.org.

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