PRINTER'S NO. 1111
THE GENERAL ASSEMBLY OF PENNSYLVANIA
HOUSE BILL
No.
1075
Session of
2021
INTRODUCED BY SNYDER, KINSEY, HANBIDGE, DAVIDSON, CARROLL, LEE,
BERNSTINE, IRVIN, BOBACK, PASHINSKI, A. DAVIS, SANCHEZ,
HOHENSTEIN, HILL-EVANS, NEILSON, WEBSTER, SCHLOSSBERG,
STRUZZI, DELLOSO, KOSIEROWSKI, MATZIE, ZIMMERMAN, GLEIM,
SCHLEGEL CULVER, SCHWEYER, O'MARA, RABB, DRISCOLL, DeLUCA,
DEASY, KINKEAD, WARNER, DAVANZO, STAMBAUGH, PISCIOTTANO,
CIRESI AND ROZZI, APRIL 1, 2021
REFERRED TO COMMITTEE ON CONSUMER AFFAIRS, APRIL 1, 2021
AN ACT
Amending Title 64 (Public Authorities and Quasi-Public
Corporations) of the Pennsylvania Consolidated Statutes,
establishing the Pennsylvania Broadband Development Authority
to provide broadband Internet access to unserved and
underserved residents; and providing for powers and duties of
the authority, for financial assistance and for grants.
The General Assembly of the Commonwealth of Pennsylvania
hereby enacts as follows:
Section 1. Title 64 of the Pennsylvania Consolidated
Statutes is amended by adding a chapter to read:
CHAPTER 61
PENNSYLVANIA BROADBAND DEVELOPMENT AUTHORITY
SUBCHAPTER A
GENERAL PROVISIONS
Sec.
6101. Scope of chapter.
6102. Findings and declaration of policy.
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6103. Definitions.
§ 6101. Scope of chapter.
This chapter relates to the development and expansion of
broadband services to unserved and underserved areas of this
Commonwealth.
§ 6102. Findings and declaration of policy.
The General Assembly finds and declares as follows:
(1) Access to high-speed broadband Internet services is
rapidly becoming a necessity for most households and
businesses in Pennsylvania.
(2) High-speed broadband has applications for education,
health care, agriculture, economic and community development
and tourism, especially in terms of telehealth, distance
learning, precision agriculture and the economic value
inherent in Internet connectivity as well as other endeavors.
(3) Based on the state of technology in the year 2021,
mobile and fixed broadband services are not functional
substitutes for all uses and customer groups. Mobile
broadband service is an alternative, not a substitute, for
fixed-wired service. Wireless mobile technology connects the
user to a wireless facility that in turn routes the
communications via coaxial or fiber cable lines to the
Internet and thus is ultimately reliant on wired service as
well.
(4) Areas exist within this Commonwealth that are
unserved or underserved by wired, high-speed broadband
service.
(5) The economic and business incentives to deploy wired
high-speed broadband service infrastructure may be
insufficient to ensure full access to high-speed broadband
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services in low-density, rural locations and other locations
within this Commonwealth where the unit costs of providing
service may not provide an adequate return on investment for
commercial companies.
(6) Multiple departments, agencies and entities are
engaged in efforts to deploy, expand and support broadband
services which can lead to uncoordinated and potentially
duplicative actions. A single entity serving as point of
contact for all broadband-related activities can help align
and leverage otherwise isolated efforts.
(7) Support in the form of financial assistance and
grants for the deployment and expansion of wired high-speed
broadband service is in the policy interest of this
Commonwealth.
§ 6103. Definitions.
The following words and phrase as used in this chapter shall
have the meanings given to them in this section unless the
context clearly indicates otherwise:
"Authority." The Pennsylvania Broadband Development
Authority established under section 6111(a) (relating to
authority).
"Board." The board of directors of the Pennsylvania
Broadband Development Authority established under section 6112
(relating to board).
"Eligible cost." The cost of all labor, materials, machinery
and equipment, land, property, rights and easements, plans and
specifications, surveys or estimates of costs and revenues,
prefeasibility studies, engineering and legal services and all
other expenses necessary or incident to the acquisition,
construction, improvement, expansion, extension, repair or
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rehabilitation of all or part of a project.
"Financial assistance." Loans, grants, guarantees, sales,
leases, investments, lines of credit, letters of credit and
other financial arrangements which the authority may provide
under this chapter.
"Underserved area." A project area, as determined by
regulation of the authority, where service is limited by the
number of providers offering service in the area or the
percentage of the area that has coverage, but that has access to
at least one wireline or fixed wireless broadband service
provider offering the greater of:
(1) minimum speeds of at least 25 megabits per second
downstream and three megabits per second upstream; or
(2) minimum speeds adopted by the Federal Communications
Commission.
"Unserved area." A project area without access to wireline
or fixed wireless broadband service at the greater of:
(1) minimum speeds of at least 25 megabits per second
downstream and three megabits per second upstream; or
(2) minimum speeds adopted by the Federal Communications
Commission.
SUBCHAPTER B
STRUCTURE AND GOVERNANCE
Sec.
6111. Authority.
6112. Board.
6113. Audits.
6114. Annual report.
6115. Sources of revenue.
§ 6111. Authority.
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(a) Establishment.--The Pennsylvania Broadband Development
Authority is established as an independent authority. The
authority shall be an instrumentality of the Commonwealth and a
body corporate and politic, with corporate succession. The
exercise by the authority of the powers conferred on the
authority by this chapter shall be deemed and held to be a
public and essential government function.
(b) Governance.--The authority shall be governed by a board
of directors as provided in section 6112 (relating to board).
The powers of the authority shall be exercised by the board.
(c) Expenses.--Expenses of the authority shall be paid from
assets or income of the authority. Except as provided in this
chapter or by other law, the Commonwealth shall not be
responsible for funding the expenses of the authority.
(d) Fiscal year.--The fiscal year of the authority shall be
the same as the fiscal year of the Commonwealth.
(e) Existence and dissolution.--
(1) The authority shall terminate 20 years after the
effective date of this section, unless re-enacted and re-
established by law.
(2) The authority may be dissolved by law, provided that
the authority has no debts or obligations outstanding or that
provision has been made for the payment or retirement of all
of its debts and obligations. Upon any dissolution of the
authority, all property, funds and assets of the authority
shall be vested in the Commonwealth.
(f) Procurement.--The authority shall be considered an
independent agency for purposes of 62 Pa.C.S. Pt. I (relating to
Commonwealth procurement code).
(g) Applicability.--The following acts shall apply to the
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authority and the board:
(1) The act of February 14, 2008 (P.L.6, No.3), known as
the Right-to-Know Law.
(2) The act of July 19, 1957 (P.L.1017, No.451), known
as the State Adverse Interest Act.
(3) The provisions of 65 Pa.C.S. Chs. 7 (relating to
open meetings) and 11 (relating to ethics standards and
financial disclosure).
§ 6112. Board.
(a) Composition.--The board of directors of the authority
shall consist of members selected as follows:
(1) The Secretary of Agriculture or a designee.
(2) The Secretary of Community and Economic Development
or a designee.
(3) The Deputy Secretary for Technology and Innovation
in the Department of Community and Economic Development or a
designee.
(4) The Secretary of Education or a designee.
(5) The Secretary of Health or a designee.
(6) The Secretary of Labor and Industry or a designee.
(7) The Secretary of Policy and Planning or a designee.
(8) The executive director of the Pennsylvania Office of
Broadband Initiatives or a designee.
(9) A member of the Senate appointed by the President
pro tempore and a member of the Senate appointed by the
Minority Leader, or their designees.
(10) A member of the House of Representatives appointed
by the Speaker and one member of the House appointed by the
Minority Leader, or their designees.
(11) The executive director of the Governor's Center for
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Local Government Services of the Pennsylvania Municipal
League or a designee.
(12) The chairperson of the Pennsylvania Public Utility
Commission or a designee.
(13) The vice chairperson of the Pennsylvania Public
Utility Commission or a designee.
(14) The Small Business Advocate or a designee.
(15) The Consumer Advocate or a designee.
(16) The director of the Center for Rural Pennsylvania
or a designee.
(17) Persons appointed by the Governor, as follows:
(i) Two representative of broadband service
providers.
(ii) Two representatives of counties, boroughs,
towns or townships that are located in unserved areas.
(iii) A representative of a city that is, in whole
or in part, located in an unserved area.
(b) Organization.--The Governor shall select a member of the
board to serve as chairperson. The members shall select from
among themselves such officers as they shall determine to be
necessary.
(c) Quorum.--A quorum shall consist of 12 members of the
board at a meeting. Action may be taken and motions and
resolutions adopted by the authority by the affirmative vote of
at least 12 members of the board. No vacancy on the board shall
impair the right of a quorum of members or the board to exercise
the powers and perform the duties of the authority.
(d) Designees.--A public officer member of the board may
designate an officer or employee of the Commonwealth to
represent the public officer member at meetings of the board.
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Each designee may lawfully vote and otherwise act on behalf of
the public officer member. The designation shall be in writing
delivered to the authority and shall continue in effect until
revoked or amended in writing delivered to the authority.
(e) Services.--Research, investigation and other services
necessary for the operation of the board shall be carried out
from resources and by employees from the various executive
departments represented on the board. All applicable
Commonwealth departments and agencies shall cooperate with, and
provide assistance to, the board, which may, at its discretion,
provide financial reimbursement.
(f) Compensation.--The members of the board shall not be
entitled to compensation for service. The members of the board
shall be entitled to reimbursement for all necessary and
reasonable expenses incurred in connection with the performance
of their duties.
(g) Fiduciary relationship.--The members of the board and
the professional personnel of the board shall stand in a
fiduciary relationship with the Commonwealth and the authority
as to the money and investments of the authority.
§ 6113. Audits.
The accounts and books of the authority, including its
receipts, disbursements, contracts, mortgages, investments and
other matters relating to its finances, operations and affairs,
shall be examined and audited by the Auditor General.
§ 6114. Annual report.
The board shall provide the Governor and the General Assembly
with an annual report by December 31 of each year detailing all
projects funded under section 6131 (relating to financial
assistance). The annual report shall be published and maintained
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on the authority's publicly accessible Internet website and may
be submitted to the Governor and the General Assembly by
electronic mail.
§ 6115. Revenues of the authority.
(a) Sources of revenues.--The authority may receive money
from any source of revenue, including, but not limited to, the
following:
(1) Federal funds appropriated to or granted to the
authority.
(2) State funds appropriated to the authority.
(3) Proceeds from the sale of authority assets.
(4) Repayment of loan principal.
(5) Payment of interest on loans made by the authority.
(6) Interest earned on the investments of authority
moneys.
(b) Control of revenues and investment of funds.--The board
shall have exclusive control and management of all money of the
authority and full power to invest money not required for
immediate use in securities or other investments in which funds
of the Commonwealth are authorized to be invested and in any
other type of security or investment if, prior to the
acquisition of the security or investment, the board determines
by resolution that the type of security or investment is in the
best interests of the authority and the State Treasurer approves
of the type of security or investment.
(c) Funds or accounts.--The board shall establish and
maintain the following funds or accounts:
(1) A general fund from which the board may authorize
expenditures for any purpose authorized under this chapter.
(2) A nonrevolving fund or account as the board deems
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necessary or convenient.
(3) A separate fund and account as may be necessary for
the deposit of payments made under authority or requirement
of Federal or State law.
(d) Loan repayment.--Repayments of loan principal, together
with any interest, shall be deposited with the authority.
SUBCHAPTER C
POWERS AND DUTIES
Sec.
6121. Corporate powers and duties in general.
6122. Specific powers and duties.
6123. Financial powers and duties.
6124. Pledges.
§ 6121. Corporate powers and duties in general.
The authority shall have and may exercise all powers
necessary or appropriate to carry out and effectuate the
purposes of this chapter, including the following:
(1) Conduct examinations and investigations and take
testimony, under oath or affirmation, on any matter necessary
to the determination and approval of project applications.
(2) Sue and be sued, implead and be impleaded, complain
and defend in all courts.
(3) Adopt, use and alter at will a corporate seal.
(4) Make bylaws for the management and regulation of the
authority's affairs, and make, adopt, amend and repeal rules
and regulations governing the administrative procedures and
business of the authority.
(5) Notwithstanding paragraph (3), and in order to
facilitate the speedy implementation of programs under this
chapter, the board shall have the power and authority to
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promulgate, adopt and use guidelines which shall be published
in the Pennsylvania Bulletin. The guidelines shall be subject
to review according to section 204(b) of the act of October
15, 1980 (P.L.950, No.164), known as the Commonwealth
Attorneys Act, and shall not be subject to review under the
act of June 25, 1982 (P.L.633, No.181), known as the
Regulatory Review Act, and shall be effective for a period
not to exceed one year from the effective date of this
section. After the expiration of the one-year period, all
guidelines shall expire and shall be replaced by regulations
which shall have been promulgated, adopted and published as
provided by law.
(6) Make contracts of every name and nature and execute
all instruments necessary or convenient for the carrying on
of authority business.
(7) Procure insurance against any loss in connection
with authority property and other assets and operations in
any amount and from any insurer as the authority deems
desirable.
(8) Contract for the services of attorneys, accountants
and financial experts and any other advisor, consultant and
agent as may be necessary in the authority's judgment,
subject to the requirement that the chairperson shall ensure
that diverse and disadvantaged businesses as defined in 62
Pa.C.S. Ch. 22 (relating to diverse and disadvantaged
businesses) shall have an opportunity to participate to a
significant degree in the provision of any contractual
service purchased by the authority.
(9) Perform any act necessary or convenient to the
exercise of the powers enumerated in this section or
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reasonably implied from those powers.
(10) Prepare plans and reports and provide for public
participation as deemed appropriate.
§ 6122. Specific powers and duties.
(a) Single point of contact.--The authority shall serve as a
single point of contact for entities wishing to engage in
broadband development and deployment in this Commonwealth,
including coordination of public and private efforts to avoid
overbuilding of capacity in any given geographic area and to
efficiently utilize existing infrastructure.
(b) Funding resource base.--In addition to providing the
financial assistance authorized by this chapter to support
broadband deployment, the authority shall identify and
coordinate opportunities to access Federal funding,
nongovernmental organization funding and other funding
opportunities to eliminate duplicative funding requests and
synthesize multiple-provider joint efforts in any given
geographic area.
(c) Cooperation of other Commonwealth entities.--All
Commonwealth agencies and departments charged with specific
aspects of broadband development and deployment shall
communicate and cooperate with the authority so that it can
maintain a centralized database of all broadband deployment
activities occurring within this Commonwealth to avoid
duplication of efforts, as well as provide consultation on their
respective areas of expertise.
(d) Educational materials.--The authority may develop
educational materials and engage in public information campaigns
to encourage adoption of broadband where currently available and
increase consumer understanding of the need for broadband access
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for all Commonwealth residents.
(e) Municipal guidance.--The authority may develop
guidelines for municipalities to assist in streamlining zoning
processes in order to help expedite broadband deployment.
§ 6123. Financial powers and duties.
The authority shall have and may exercise all powers
necessary or appropriate to effectuate the programs established
under this chapter, including the following:
(1) Accept grants from and enter into contracts or other
transactions with Federal, State or local agencies.
(2) Take title by foreclosure or otherwise to any
project or other property pledged, mortgaged, encumbered or
otherwise available as security for a project financed in
whole or in part by the board, whether by loan, loan
guarantee or otherwise, where the acquisition is necessary to
protect the interests of the board with respect to a project
and pay all costs arising out of the acquisition from money
held by the authority and sell, transfer and convey all or
any portion of the project to any responsible buyer. The
board may require a dedicated source of revenue to be
available for repayment of any loan.
(3) Provide financial assistance, including, but not
limited to, loans, loan guarantees, grants for eligible costs
of projects fulfilling the purposes of this chapter.
(4) Collect fees and charges relating to projects funded
under this chapter, as the board determines to be reasonable,
relating to activities undertaken in furtherance of the
purposes of this chapter.
(5) Borrow money for the purposes of this chapter.
(6) Receive appropriations and apply for and accept
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grants, gifts, donations, bequests and settlements from any
public or private source.
(7) Acquire, own, hold, construct, improve,
rehabilitate, renovate, operate, maintain, sell, assign,
exchange, lease, mortgage or otherwise dispose of real and
personal property or any interest therein in the exercise of
the authority's powers and performance of the authority's
duties under this chapter.
(8) Fund prefeasibility studies from any authority
source of revenue.
§ 6124. Pledges.
A pledge of revenues, receipts, money, funds or other
property or instruments made by the authority shall be valid and
binding from the time when the pledge is made. The revenues,
receipts, money, funds or other property pledged and received by
the authority shall be immediately subject to the lien of the
pledge without its physical delivery or further act, and the
lien of a pledge shall be valid and binding against all parties
having claims of any kind in tort, contract or otherwise against
the authority irrespective of whether the parties have notice of
the lien. Neither the resolution nor any other instrument by
which a pledge under this section is created or evidenced need
be filed or recorded except in the records of the authority.
SUBCHAPTER D
FINANCIAL ASSISTANCE AND GRANTS
Sec.
6131. Financial assistance.
6132. Grants.
6133. Loans.
§ 6131. Financial assistance.
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(a) Criteria for obtaining assistance.--In reviewing
applications for financial assistance, the authority shall
consider:
(1) Whether the project will improve the health, safety,
welfare or economic well-being of the people of this
Commonwealth.
(2) Whether the proposed project will lead to an
effective or complete solution to the lack of wired high-
speed broadband service in an unserved area.
(3) The cost-effectiveness of the proposed project in
comparison with other alternatives, including other
institutional, financial and physical alternatives.
(4) The consistency of the proposed project with other
broadband deployment projects in the area.
(5) Whether the applicant has demonstrated an ability to
operate and maintain the project in a proper manner.
(6) The experience of the applicant in providing high-
speed broadband services.
(7) The financial condition of the applicant.
(8) The availability of other sources of funds at
reasonable rates to finance all or a portion of the project
and the need for authority assistance to finance the project
or to attract the other sources of funding.
(b) Potential applicants.--
(1) An applicant may be a commercial entity, a
community-based network, a municipality, a rural electric
cooperative or other group of investors or entity.
(2) If an applicant, public or private, proposes a
broadband development project but has no prior experience in
developing or operating high-speed broadband service, a bond
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shall be provided in an amount determined by the board
necessary to protect the authority's investment in the
project, whether as a grant or loan.
(c) Financing priorities.--In addition to any requirement of
Federal law imposed on the use of Federal funds, the board shall
determine priorities based on factors which include, but are not
limited to:
(1) The project's ability to deploy high-speed broadband
service in an area that is unserved.
(2) Improvement in the availability, adequacy or
efficiency of wired high-speed broadband service in an
underserved area, without creating duplicative services.
(3) The contribution to and impact of the project on
economic development as well as social and environmental
values.
(4) Benefits to public safety or welfare.
(5) Improvement in the ability of an applicant to come
into compliance with Federal and State statutes, regulations
and standards.
(6) The cost-effectiveness of the project.
(d) Decision of board.--
(1) Establishment of priority for financial assistance
under subsection (b) shall not be deemed to be a final action
under 2 Pa.C.S. (relating to administrative law and
procedure), nor shall it confer a right or duty upon the
board or any other person.
(2) A decision as to an applicant's eligibility under
subsection (a) may be appealed pursuant to 2 Pa.C.S., but the
priority assigned the project may not be raised in that
appeal.
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§ 6132. Grants.
The board may issue grants if the board, in its sole
discretion, determines that the financial condition of the
recipient is such that repayment of a loan is unlikely and that
the recipient will not be able to proceed with the project
without a grant. If the board determines that a grant is
necessary from the authority, the board shall attempt to mix the
grant funds with loan funds if financially possible.
§ 6133. Loans.
(a) General terms.--The board shall set terms applicable to
loans in any manner it deems appropriate, subject to the
provisions of this subsection. The board may consider such
factors as it deems relevant, including current market interest
rates, the financial and economic distress of the area which the
project serves and the necessity to maintain the authority funds
in a financially sound manner. Loans may be made based on the
ability to repay the loan from future revenue to be derived from
the project, by a mortgage or other property lien or on any
other fiscal matters which the authority deems appropriate.
(b) Deferral of principal.--The board may defer principal on
loans for up to five years. In the event of a default on the
repayment of a loan, the board may apply to the court of common
pleas of the county where the project is located for the
appointment of a receiver to assume operation and supervision of
the facility under the supervision of the court.
(c) Interest rate.--The minimum rate of interest to be paid
on any loan made under this chapter shall be 1%. The maximum
rate of interest shall not exceed the following:
(1) For a project in a county where the unemployment
rate exceeds the Statewide unemployment rate by at least 40%,
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1% for the first five years and 25% of the bond issue rate
for the remainder of the loan.
(2) For a project in a county where the unemployment
rate exceeds the Statewide unemployment rate, but exceeds it
by less than 40%, 30% of the bond issue rate for the first
five years and 60% of the bond issue rate for the remainder
of the loan.
(3) For a project in a county not described in paragraph
(1) or (2), 60% of the bond issue rate for the first five
years and 75% of the bond issue rate for the remainder of the
loan.
(4) For a project located within a city, township or
borough where the unemployment rates exist which would
qualify the project for lower interest rates than if the
relevant county unemployment rate were used, the unemployment
rate of the city, township or borough may be used in
determining the interest rate on the loan.
(d) Limitation on annual assistance.--The amount of
assistance approved by the board under section 6132 (relating to
grants) shall not in any fiscal year exceed the amount of
interest earnings, State appropriations and any money received
specifically for grants which are deposited by the authority.
(e) Inspection of project and records.--
(1) The applicant shall allow the authority and its
successors, agents and representatives the right, at all
reasonable times during construction and after completion of
the project, to enter upon and inspect the project and to
examine and make copies of the applicant's books, records,
accounting data and other documents pertaining to the project
and the financial condition of the applicant.
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(2) The applicant may be required by the board or its
agent to prepare independent audits of the applicant's
financial documents and financial condition and submit a
certified copy of the audits to the board.
(f) Financial analysis.--The financial analysis used by the
board to determine the need of all applicants for financial
assistance shall include, but not be limited to, the following:
(1) Fair and reasonable costs of wired high-speed
broadband service in comparable areas.
(2) The incomes of affected subscribers and their
ability to pay increased charges necessary to complete the
proposed projects.
(3) Other sources of financing available to individuals
or entities seeking assistance under this chapter.
(4) A determination that financial assistance provided
under this chapter will not be used to supplant financial
resources already available to the applicant.
(g) Steel procurement.--An application must contain a
certification that the applicant shall comply, in every contract
for the acquisition, repair, construction, reconstruction,
rehabilitation, extension, expansion, improvement, alteration or
maintenance of a water supply or sewage treatment system, with
the provisions of the act of March 3, 1978 (P.L.6, No.3), known
as the Steel Products Procurement Act.
(h) Definition.--As used in subsection (c), the term
"unemployment rate of the county" shall mean the average
unemployment rate for the county in the most recent calendar
year for which data has been finalized. For a project that
serves multiple counties, the highest unemployment rate from
among the counties involved shall be used. The unemployment data
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utilized shall be data reported by the Department of Labor and
Industry.
Section 2. This act shall take effect in 60 days.
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