Governor Brown signs community broadband bond financing bills into law

by Steve Blum • , , , , ,

Cities and other local agencies in California will be able to issue bonds to pay for building broadband infrastructure, thanks to two new laws approved by Governor Brown yesterday. Assembly bill 2292 and senate bill 628 expand the use of infrastructure financing districts (IFDs), on the one hand specifically allowing broadband to be included in old-style IFDs and creating a new kind, called enhanced infrastructure financing districts, on the other. In both cases, the bonds can be repaid by earmarking the incremental tax revenue that the project is expected to produce.

It’s more like a win and a half than two solid victories for community-financed broadband, though. SB 628 creates enhanced IFDs, which only require a single two-thirds majority vote by the electorate and have more flexible structures. It goes a long way toward replacing the old redevelopment agencies that the legislature (and the governor and the courts) killed in 2012. It will be a very useful tool for upgrading California’s ageing and overused water and transportation infrastructure, among other things. But it doesn’t specifically allow enhanced IFDs to issue bonds to build broadband facilities. Nor does it prevent it, particularly. So until someone actually tries to use it for, say, a fiber network, broadband will be in a grey area of the new law.

Not so with traditional IFDs, though. AB 2292, authored by San Leandro assemblyman Rob Bonta, specifically allows the use of bonds to build broadband infrastructure, and defines it as “communications network facilities that enable high-speed Internet access”.

Legally, the two don’t overlap, so Bonta’s bill doesn’t directly affect the new and improved system created by SB 628. But as far as it goes, it gives broadband the same critical infrastructure status as roads, sewers and aqueducts.