Nov. 13 2018 10:49 AM

BWL alters policy after push by LightSpeed Communications

TUESDAY, Nov. 13 — Fiber-speed internet connections are poised to spread rapidly throughout the capital city as officials at the Lansing Board of Water & Light look to adjust their policies on utility pole attachments.


Pressured by East Lansing’s LightSpeed Communications, BWL General Manager Dick Peffley has announced plans to allow Internet providers to dodge obstacles to network expansion and streamline their access to 32,000 utility poles scattered across the city of Lansing.


“We’ve really been scrambling to get this far,” Peffley said, noting dozens of contracts with telecommunications companies like AT&T and Comcast will need to be rewritten before any changes can come to fruition. He said any meaningful policy changes could still at least a year away but emphasized them as a top priority.


The announcement arrived weeks after City Pulse detailed concerns voiced exclusively by LightSpeed CEO Jason Schreiber. He contended BWL’s policies on pole attachments were out-of-step with national trends and for years have stalled his company’s plans to connect to virtually every utility pole in the city.


Schreiber said any proposed changes would be a “huge win” for local residents looking for faster Internet speeds. “I’m looking forward to working with BWL on ways to reach Lansing homes as quickly as possible,” he added.


Here’s the situation:


New Internet lines, regardless of the service provider, need to be installed along every city street before service can be connected. The customary practice is to use existing utilities, Schreiber said. In Lansing, most of those utilities are installed on poles already owned by BWL.


Other utilities on those poles often need adjustment before another can move in. Sometimes lines need to be moved up or down a few inches to bring them into compliance with regulatory codes.


But the BWL requires providers to seek a permit from every other utility using those spaces before any newcomers can arrive.


And there’s where Peffley — and officials statewide — want to introduce some key changes.

Sometimes dueling utility providers disagree on the redesigned layout. Other times, companies will need to pay off their debts to one another before they’re willing to make changes. But in most circumstances, “it’s just plain politics,” Peffley said. Companies will often create delays simply to protect their share of the local market.


“One of the new attachers is trying to take business from the existing attachers,” Peffley added. “Well, we get stuck in the middle on that, as do a lot of utilities. We reach out and try to broker an agreement for the existing attachers and get things moved. It delays things. There are frustrations for everybody.”


The Federal Communications Commission voted in August to adopt one-touch, make-ready policies for most pole attachments. The practice essentially allows for one contractor — usually paid by the company requesting expansion — to make all of the necessary adjustments without waiting for each individual company to move.


The system, in other communities nationwide, has streamlined a process that in some cases has forced service providers to wait years while their competitors slowly make space. And Peffley suggested the BWL should also adopt the policies within the next year. The maneuver will drive up revenues and ease ongoing concerns, he said.


“We do believe one-touch, make-ready is the way to go but we’re not going to get there overnight,” Peffley explained to his board of directors. “We’ll continue to process permits as fast as we can. We’re hanging a lot out there and there are a lot of companies that want to be on one of our poles.”


Officials said more than 130,000 telecommunications attachments are affixed to the 32,000 poles across the city. More than 1,600 additional permit requests have been filed since January as the market continues to expand. And at about $7.30 per attachment, the potential for additional revenues continues to drive the discussion.


Peffley said the BWL collects just shy of $600,000 annually from the process, primarily from Comcast. If LightSpeed is able to expand their network as planned, then BWL stands to rake in hundreds of thousands more.


“We want everybody we can get on our poles,” Peffley said. “We have no authority to move them. By the end of next year, we hope to have the authority to move everybody. Contracts don’t contain that authority right now.”


In addition to rewriting contractual language, Peffley suggested the BWL would partner with a third-party firm that could handle the pole adjustments for every company. An in-house crew could also be assembled to help reduce costs but only if the ongoing permit requests continue to flood his office at the same rate, Peffley said.


Once those adjustments are made, the BWL would then back-charge companies for the completed work.


Peffley cautioned the board, however, that some utility providers might not like the policy adoption because the contractors hired to make the adjustments will soon be able to keep a sharper eye on existing pole attachments. Companies previously using a sort of regulatory honor system will now be checked for attachment compliance.


Any irregularities on the poles will automatically be adjusted, brought up to “best practices” and companies will be charged for the additional work, Peffley said. And some utilities may not like the added operational oversight.


“It would definitely be revenue-neutral for our customers,” Peffley added. “If anything, it’s a revenue source.”


The proposed changes stand in stark contrast from Peffley’s previous stance on the topic. He previously voiced plans to “look into” policy changes but emphasized that no other utility companies shared the same concerns as Lightspeed. He also noted last month he had no immediate plans to bring the matter to the board of directors.


“We can look into that, but I don’t want to get sued by every other utility on those poles,” he said previously.


Former BWL Board member Robert Nelson said the same issue had been repeatedly addressed as early as 2015, though Peffley and Board Chairman David Price claimed to have no recollection of the discussion. Nelson suggested board members, at the time, simply didn’t have any willingness to adjust their existing practices.


“There is virtually nobody else in the state that follows these outdated regulations,” Nelson explained. “The (BWL) is just way behind the times. I think it’s a matter of an inconvenience for them. They have to go through the process and negotiate with these other players and frankly, I think they’re beholden to these other carriers. It’s just easier for them to stay the course.”


But the pressure from Lightspeed — paired with the attention from City Pulse — has apparently shifted the tide, as Peffley explained to the board. As a member of the board of directors for the Michigan Municipal Electric Association, Peffley also voiced plans to float statewide policy changes at a meeting in December.


The association, a trade group for municipally owned electric utilities, is comprised of more than 40 communities across Michigan that own and operate a utility provider similar to the BWL. Peffley said the transition to one-touch, make-ready policies would be easier if the rest of the state can adopt the program as well.


“Maybe we can bring all the utilities together on it so we’re all doing the same thing,” Peffley suggested.


Jim Weeks, the association’s executive director, said he supported the proposed changes on a statewide scale. He labeled Lightspeed as the impetus for the policy shift but emphasized that public utility providers — regardless of the municipality — shouldn’t stand in the way of technological progress.


“It’s going to happen,” Weeks said. “We just want to do it in a way that our local governing bodies can have control of how they implement this. We’re not going to stand in the way of new technology. We’re going to embrace it but we’re going to work together and do this together in a safe way for everyone involved.”