In hopes of spurring broadband network development in rural areas, FCC Commissioner Ajit Pai called on the FCC and the federal government to cooperate in establishing “Gigabit Opportunity Zones” (GOZs) where Internet service providers (ISPs) would receive financial incentives for deploying gigabit-speed broadband networks.
Pai detailed his proposed GOZ initiative during a speech in Cincinnati on Tuesday. Modeled after the “enterprise zone” concept which was championed by the late U.S. Senator Jack Kemp (R-NY) as a means of boosting federal and local government efforts to bring economic improvements to low income areas, federally-recognized GOZs would cover any area of the U.S. where the average household income falls below 75% of the national median. Pai said that ISPs building gigabit-speed networks in such zones would receive tax incentives that include the ability to immediately expense all capital spending and carry over losses for up to seven years. Start-up ventures would receive additional tax credits to offset payroll taxes for employees who work in a GOZ, and state and local governments would be required to implement “deployment-friendly policies.”
To ease potential regulatory barriers, Pai called on the FCC to (1) reform its pole attachment rules and (2) develop a model code with the assistance of a new Broadband Deployment Advisory Committee (BDAC) that would cover local franchising, zoning, permits and rights-of-way. One function of the BDAC, said Pai, would be to “recommend to the FCC an appropriate shot clock for local action.” Pai further remarked that the BDAC “should identify categories of deployments for which there should be minimal regulatory hoops for providers to jump through.” As TechFreedom President Berin Szoka welcomed Pai’s speech as “a breath of fresh air,” Shirley Bloomfield, the CEO of rural broadband association NTCA, thanked Pai for “placing a spotlight on the fact that more public and private resources are needed to address and overcome our nation’s rural broadband challenges.”