Legislators act on net neutrality

MONTPELIER — The Scott administration and members of the Vermont Legislature are in agreement that something needs to be done to maintain public access to the internet in Vermont, but they may be at odds over how to do it.

The House and the Senate both have bills pending that provide pushback against the Federal Communication Commission's December vote repealing Obama-era net-neutrality rules — a sweeping act amounting, in effect, to deregulating the internet.

But there is concern in the Scott administration, specifically about the potential for lawsuits.

The FCC vote has been widely seen as a loss for consumers and a boon for broadband providers. The so-called net-neutrality rules put in place by the Obama administration were aimed at ensuring the public free and ready access to all content on the internet. Loss of the protections could result in major changes to how internet service is provided. Internet companies could start charging for access to certain content; they could block websites, or promote them; they could take action to slow down, or speed up, internet service to online companies, including news organizations and citizens groups.

The two Vermont bills, one passed by the Senate last week and currently before the House Energy and Technology Committee, and a House bill before the same committee, would replace federal regulation with state regulation, but to varying degrees.

Senate bill S.289, which was approved by a vote of 23-5, would require internet service providers to certify compliance with net-neutrality provisions as a precondition for winning state contracts. The bill's sponsor, Sen. Virginia Lyons, D-Williston, said the legislation would be a critical step toward protecting public access to state websites, government access television, and other online information portals.

"We don't want to see information held back or slowed down or deviated in any way when it relates to our state or local government," Lyons said.

The House bill, H.680, takes a more sweeping approach to regulation, requiring internet service providers doing business in Vermont to apply to the Public Utility Commission for net-neutrality certification. Rep. Tom Stevens, D-Waterbury, the bill's lead sponsor, said it would ensure companies adhere to strict "consumer protection and net neutrality standards."

But in a memo sent to the Senate Committee on Finance earlier this month, two agency secretaries and the state's director of telecom and connectivity expressed concern that the Senate bill could leave the state vulnerable to "costly litigation."

The memo was written Susanne Young, secretary of the Agency of Administration; John Quinn, secretary of the Agency of Digital Services; and Clay Purvis, the Department of Public Service's director of telecom and connectivity.

"The FCC's recent net neutrality order made clear that the new rules preempt any state attempts to regulate internet traffic," the memo said. "Although this bill may ultimately evade the scope of the FCC's preemption decision, it likely still lead to lawsuits with providers."

A separate memo from the state Public Service Department, written in January and addressed to Kendal Smith, state director of policy development and legislative affairs, expressed similar concerns.

"The Department strongly cautions that any sort of net neutrality law passed by a state would almost certainly result in a costly and protracted lawsuit in federal court with slim prospects of the state prevailing," the memo said.

Jim Porter, the director of the Public Service Department's Public Advocacy Division, who was involved in writing the memo, said he does not regard the FCC ruling as in the best interest of consumers. "That said, they have gone to great pains to warn the states `Don't try to regulate this,'" Porter said.

Porter said the memo was not written with specific legislation in mind, but it would be "applicable" to H.680.

Lyons said she for one was willing to risk a lawsuit. "Having an open, neutral internet is worth a great deal," she said. Much of what is being said about the bills before the Legislature, "is hypothetical and it's fearful and we should not act based on fear. We should act positively to protect what we need."

Vermont is one of a growing number of states, including Montana, New York, Hawaii and New Jersey, to take up the challenge, either through legislation or executive orders.

Chris Curtis, who is chief of public protection, in the office of the attorney general, said it was too early to talk about litigation risk. "I think it's premature to speculate on where lawmakers may land on this issue," he said.

John Quinn, the state's chief information officer and secretary of the Agency of Digital Services, stressed that the Scott administration supports net neutrality. The administration's hope is to address the matter in a way that doesn't put Vermonters at risk, such as with a House resolution, or an executive order.

"We really want to get this right to make sure we're protecting the citizens of Vermont," Quinn said.

Vermont is already involved in a lawsuit over the FCC ruling, one of its own making.

The suit, by attorneys general from 21 states, plus Washington, D.C., was filed in January, and seeks a federal appeals court ruling reversing the FCC on the grounds that the deregulatory act was "arbitrary, capricious, and an abuse of discretion."

"Vermonters deserve and expect fair treatment when it comes to internet access," Vermont Attorney General T.J. Donovan said in a statement at the time.

"The FCC's unjustified action threatens the lifeblood of businesses and consumers to transact commerce freely and fairly."

According to the statement from Donovan's office, the policy change would have "dire consequences" for businesses and consumers in Vermont and beyond.

Said Stevens, the sponsor of the House bill, "If we close off any more access to information, then we're dooming our rural economy. We already pay for access to the internet, but if we have to pay extra for access to information on the internet, then it really puts us at a disadvantage to more densely populated areas that have easier access."


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