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KY Broadband Internet Project Threatening State’s Economy

In 2015 Kentucky began a public-private project to extend high-speed internet across the state, the first such effort in the nation. But that project, Kentucky Wired, which was initially projected to be completed by late 2018, has run into delays due in part to difficulty obtaining permission from phone companies to use their transmission poles.

 

Those delays have resulted in millions of dollars in additional contractor costs. The state negotiated a deal with its private-sector partners to cover $88 million in outstanding claims and shift the project completion date to mid-2020 to avoid incurring further charges. But state lawmakers refused to approve the legislative authorization for that deal, SB 223.

 

Sen. Chris McDaniel (R), who chairs his chamber’s budget committee, said he wasn’t convinced the network would generate enough revenue to justify the additional expense.

 

Without legislative approval, the project could collapse, resulting in a significant downgrade of the state’s credit rating, according to Fitch Ratings. That would not only make borrowing money more costly for the state, but also make it more difficult for the state to put together other public-private infrastructure deals.

 

“It’s a threat to the entire economy of the state,” said Phillip K. Brown, executive director of the Kentucky Communications Network Authority, the entity that oversees the broadband internet project. (NEW YORK TIMES, LEXISNEXIS STATE NET)