Analysis by the Legislative Reference Bureau
This bill does the following: 1) makes changes to the broadband expansion
grant program; 2) eliminates requirements that apply to local government
telecommunications, video, and broadband service facilities; and 3) changes the
manufacturing and agriculture tax credit.
Broadband expansion grants. This bill appropriates $200,000,000 in
general purpose revenues in the 2017-19 fiscal biennium for the broadband
expansion grant program administered by the Public Service Commission under
current law. Under that program, the PSC makes grants to eligible applicants for
the purpose of constructing broadband infrastructure in underserved areas
designated by PSC. The bill's appropriation is in addition to appropriations from the
universal service fund for the grants under current law.
The bill creates a definition for “broadband infrastructure,” which is not defined
under current law. The bill defines “broadband infrastructure” as infrastructure
that provides broadband service at a minimum download speed of 25 megabits per
second and a minimum upload speed of 3 megabits per second. Under the bill,
infrastructure is eligible for a broadband expansion grant only if it satisfies the
foregoing definition. The bill requires a person who receives a grant to reimburse the
PSC for the grant if 1) the person fails to complete construction of the infrastructure;
or 2) the infrastructure that is constructed fails to provide minimum download or
upload speeds specified in the bill's definition of “broadband infrastructure.”
The bill changes the priorities that apply to the PSC in awarding grants.
Current law requires the PSC to give priority to projects that satisfy various
requirements, including projects that affect “unserved areas,” which current law
defines as areas without specified types of Internet service. The bill requires instead
that the PSC give first priority to projects for areas in which no broadband service
is available and secondary priority to projects that satisfy the requirements specified
under current law, except that the bill eliminates the priority for unserved areas. In
addition, the bill requires the PSC to award no less than 85 percent of the grants in
a fiscal year for projects to construct broadband infrastructure in counties with
populations of 65,000 or less.
The bill also changes eligibility requirements for the grants. Under current law,
telecommunications utilities are eligible to apply. Under the bill, a
telecommunications utility is eligible only if it has not applied for or received support
for broadband deployment under certain federal programs administered by the
Federal Communications Commission. The bill also allows a city, village, town, or
county to apply for a grant without submitting the application in partnership with
a telecommunications utility or for-profit or not-for-profit organization, which is
required under current law. The bill also specifies that a city, village, town, or county
may use a grant for planning related to broadband infrastructure construction,
including broadband feasibility reports. Also, the bill requires all applicants for
grants to specify the broadband infrastructure the applicant intends to construct
with a grant and requires the applicant to complete that construction before applying
for a subsequent grant.
The bill also does the following:
1. Requires persons who receive grants to submit reports to the PSC on the
progress of broadband infrastructure construction, the number of broadband service
connections provided by that infrastructure, and the average download and upload
speeds for those service connections.
2. Beginning on January 1, 2019, requires the Legislative Audit Bureau to
conduct biennial performance audits of the broadband expansion grant program.
3. Requires the PSC to require retail electric utilities and cooperatives to
survey customers and members about broadband service availability. The PSC must
reimburse the utilities and cooperatives for conducting the surveys and use the
survey results to improve broadband mapping.
Local government telecommunications, video, and broadband service
facilities. The bill eliminates a requirement for a city, village, or town (local
government) to prepare a report before holding a public hearing on a proposed
ordinance or resolution authorizing the local government to construct or operate
facilities for providing telecommunications service, cable television or similar video
service, or broadband service to the public. With exceptions, current law prohibits
a local government from enacting an ordinance or adopting a resolution authorizing
the local government to construct or operate such a facility unless the local
government gives notice and holds a public hearing on the proposed ordinance or
resolution. In addition, at least 30 days prior to the hearing, current law requires
the local government to prepare and make available to the public a report that
estimates the total costs and revenues for the facility and includes a cost-benefit
analysis of the facility for a period of at least three years. Under this bill, a local
government is not required to prepare that report.
Manufacturing and agricultural tax credit. The bill provides that an
individual whose income is greater than $2,000,000 a year may not claim the
manufacturing and agriculture tax credit for taxable years beginning after
December 31, 2017. Under current law, any person who has qualified production
activities income from manufacturing or agriculture may claim the credit in an
amount equal to the income multiplied by 7.5 percent.
For further information see the state fiscal estimate, which will be printed as
an appendix to this bill.
The people of the state of Wisconsin, represented in senate and assembly, do
enact as follows:
SB847,1
1Section
1. 20.005 (3) (schedule) of the statutes: at the appropriate place, insert
2the following amounts for the purposes indicated:
-
See PDF for table 
SB847,2
1Section
2. 20.155 (3) (a) of the statutes is created to read:
SB847,4,42
20.155
(3) (a)
Broadband expansion grants; general purpose revenue funding. 3Biennially, the amounts in the schedule for making broadband expansion grants
4under s. 196.504 and for reimbursing electric providers under s. 196.504 (3) (e).
SB847,3
5Section
3. 20.155 (3) (g) of the statutes is created to read:
SB847,4,86
20.155
(3) (g)
Broadband expansion grants; program revenue funding. All
7moneys received as broadband grant reimbursements under s. 196.504 (2g) (c) for
8making broadband expansion grants under s. 196.504.
SB847,4
9Section
4. 66.0422 (2) (c) of the statutes is repealed.
SB847,5
10Section
5. 66.0422 (4) of the statutes is repealed.
SB847,6
11Section
6. 66.0422 (5) of the statutes is repealed.
SB847,7
12Section
7. 71.07 (5n) (c) 6. of the statutes is created to read:
SB847,4,1513
71.07
(5n) (c) 6. For taxable years beginning after December 31, 2017, no
14individual may claim the credit under this subsection for a taxable year in which the
15individual's adjusted gross income is greater than $2,000,000.
SB847,8
16Section
8. 71.28 (5n) (c) of the statutes is amended to read:
SB847,5,217
71.28
(5n) (c)
Limitations. Partnerships, limited liability companies, and
18tax-option corporations may not claim the credit under this subsection, but the
19eligibility for, and the amount of, the credit are based on their share of the income
20described under par. (b). A partnership, limited liability company, or tax-option
21corporation shall compute the amount of credit that each of its partners, members,
22or shareholders may claim and shall provide that information to each of them.
23Partners, members of limited liability companies, and shareholders of tax-option
24corporations may claim the credit in proportion to their ownership interests
, but, for
25taxable years beginning after December 31, 2017, no partner, member, or
1shareholder may claim the credit for a taxable year in which the adjusted gross
2income of the partner, member, or shareholder is greater than $2,000,000.
SB847,10
5Section
10. 196.504 (1) (ac) of the statutes, as affected by
2017 Wisconsin Act
659, is renumbered 196.504 (1) (g), and 196.504 (1) (g) 2. and 3., as renumbered, are
7amended to read:
SB847,5,98
196.504
(1) (g) 2. A telecommunications utility
that has not received or applied
9for A-CAM or phase II support.
SB847,5,1110
3. A political subdivision
that submits an application in partnership with an
11eligible applicant under subd. 1. or 2.
SB847,12
14Section
12. 196.504 (1) (ae) of the statutes is renumbered 196.504 (1) (j).
SB847,13
15Section
13. 196.504 (1) (af) of the statutes is created to read:
SB847,5,2016
196.504
(1) (af) “A-CAM support” means support for the deployment of voice
17and broadband-capable networks from the federal Connect America Fund that is
18made to telecommunications utilities regulated as rate-of-return carriers by the
19federal communications commission and that is based on the federal
20communications commission's Alternative Connect America Cost Model.
SB847,14
21Section
14. 196.504 (1) (am) of the statutes is renumbered 196.504 (1) (k).
SB847,15
22Section
15. 196.504 (1) (b) of the statutes is renumbered 196.504 (1) (L).
SB847,17
25Section
17. 196.504 (1) (d) of the statutes is created to read:
SB847,6,3
1196.504
(1) (d) “Broadband infrastructure” means infrastructure for the
2provision of broadband service at a minimum download speed of 25 megabits per
3second and a minimum upload speed of 3 megabits per second.
SB847,18
4Section
18. 196.504 (1) (f) of the statutes is created to read:
SB847,6,65
196.504
(1) (f) “Electric provider” means a retail electric public utility or retail
6electric cooperative.
SB847,19
7Section
19. 196.504 (1) (i) of the statutes is created to read:
SB847,6,118
196.504
(1) (i) “Phase II support” means the federal communications
9commission's 2nd phase of support for rural broadband deployment from the federal
10Connect America Fund that is made to telecommunications utilities regulated as
11price cap carriers by the federal communications commission.
SB847,6,2214
196.504
(2) (a) To make broadband expansion grants to eligible applicants for
15the purpose of constructing broadband infrastructure in underserved areas
16designated under par. (d)
and to political subdivisions for project planning related
17to such construction, including broadband feasibility reports. An eligible applicant
18shall specify in its application for a grant the broadband infrastructure the applicant
19intends to construct with the grant. Grants awarded under this section shall be paid
20from the appropriations under s. 20.155 (3)
(a), (g), (r)
, and (rm).
Not less than 85
21percent of the grants awarded in a fiscal year shall be for the construction of
22broadband infrastructure in counties with populations of 65,000 or less.
SB847,7,18
1196.504
(2) (c) To establish criteria for evaluating applications and awarding
2grants under this section. The criteria shall prohibit grants that have the effect of
3subsidizing the expenses of a provider of telecommunications service, as defined in
4s. 182.017 (1g) (cq), or the monthly bills of customers of those providers.
The criteria
5shall give first priority to projects for areas in which no broadband service is
6available. The criteria shall give
secondary priority to projects that include matching
7funds, that involve public-private partnerships,
that affect unserved areas, that are
8scalable, that promote economic development, that will not result in delaying the
9provision of broadband service to areas neighboring areas to be served by the
10proposed project, or that affect a large geographic area or a large number of
11underserved individuals or communities. When evaluating grant applications
12under this section, the commission shall consider the degree to which the proposed
13projects would duplicate existing broadband infrastructure, information about the
14presence of which is provided to the commission by the applicant or another person
15within a time period designated by the commission; the impacts of the proposed
16projects on the ability of individuals to access health care services from home and the
17cost of those services; and the impacts of the proposed projects on the ability of
18students to access educational opportunities from home.
SB847,23
21Section
23. 196.504 (2g) of the statutes is created to read:
SB847,8,222
196.504
(2g) (a) The commission shall require persons who receive grants
23under sub. (2) (a) to submit reports to the commission on the progress of construction
24activities for infrastructure specified in grant applications, the number of broadband
1service connections provided by that infrastructure after construction is completed,
2and the average download and upload speeds for those service connections.
SB847,8,53
(b) A person who receives a grant under sub. (2) (a) may not apply for a
4subsequent grant under sub. (2) (a) until completion of construction of the
5infrastructure specified in the application for the prior grant.
SB847,8,76
(c) A person who receives a grant under sub. (2) (a) shall reimburse the
7commission an amount equal to the grant if any of the following applies:
SB847,8,98
1. The person fails to complete construction of broadband infrastructure that
9is specified in the person's application under sub. (2) (a).
SB847,8,1210
2. The infrastructure constructed with the grant fails to provide broadband
11service with an average minimum download speed of 25 megabits per second or an
12average minimum upload speed of 3 megabits per second.
SB847,8,1713
(d) The commission shall promulgate rules for submitting reports under par.
14(a), determining completion of construction for purposes of par. (b), and making
15reimbursements under par. (c). If a person fails to make a reimbursement as
16required under the rules, the person is not eligible for any other grant under sub. (2)
17(a).
SB847,24
18Section
24. 196.504 (2r) of the statutes is created to read:
SB847,8,2119
196.504
(2r) Biennially, beginning on January 1, 2019, the legislative audit
20bureau shall conduct a performance evaluation audit of the broadband expansion
21grant program under sub. (2).
SB847,25
22Section
25. 196.504 (3) (d), (e) and (f) of the statutes are created to read:
SB847,8,2523
196.504
(3) (d) Require electric providers to survey customers and members
24about the availability of broadband service and provide the survey results to the
25commission.
SB847,9,2
1(e) Reimburse electric providers for the cost of conducting surveys under par.
2(d).
SB847,9,33
(f) Use survey results under par. (d) to improve broadband mapping.
