Mayor Newman and Britt Dye butt heads over TVA grant

 

On Friday, August 28, following TVA’s announcement of a substantial contribution to their Community Care Fund, Mayor Bill Newman wrote a widely distributed letter to Fayetteville Public Utilities CEO Britt Dye, requesting that this money be invested in the expansion of internet service in Lincoln County. Three days after this letter was sent, Dye responded, not only declining Mayor Newman’s request, but also asking that the county invest their own funds in FPU’s work on broadband expansion.

The exchange was precipitated by a press release issued by TVA on Thursday, August 27. In said release, TVA announced three actions that had been approved for the benefit of their clients – the Back-to-Business credit program was extended; a $200 million pandemic relief credit was approved for the coming fiscal year; and, most crucially to this story, an additional $2 million contribution was applied to the Community Care Fund. As stated in TVA’s release, “these funds will be matched by local power companies,” including Fayetteville Public Utilities. It should be noted, however, that TVA’s release does not specify how local power companies such as FPU are to use the funds.

Prior to this announcement, Mayor Newman had already expressed concern with the limited internet access in Lincoln County, discussing the topic with United States Senator Marsha Blackburn when they spoke via video-conference on August 20. During that discussion, Mayor Newman said, “we’ve got 30-40% [of citizens] who don’t have [high-speed internet] access, or don’t have affordable access.” This figure is accurate, substantiated by Blackburn, whose sources indicate that only 63% percent of Lincoln County households have access to a high-speed internet connection, a figure that is 12% lower than the state average. This figure is also confirmed by the United States Census Bureau.

While his letter simply provides Dye with TVA’s update and makes the request for how FPU might use this increase in funding, Mayor Newman’s personal reasoning for said request was explained further when speaking to the Elk Valley Times. Discussing the matter, Mayor Newman said, “I just feel strongly about what’s going on now with not only school children [who are studying virtually] but also people who have businesses and are operating from their home, because now there are so many people who used to go to an office and are now operating from their house, maybe for the long-term. But for school children and people operating from their home, [the internet connection] is slow – even what used to be workable has become a real pain. It’s a real need, and I just thought that with that sum of money, [expanding internet] would be a good use for it.”

Britt Dye’s response, which was also widely distributed upon being sent, sees FPU’s counter-proposal described as “fair and transparent,” with Dye explaining that FPU had decided in advance that the funds would be used for a unilateral electric rate cut for all of their customers – “The purpose of the recent Pandemic Relief Credit approved by TVA’s Board of Directors is to aid in the recovery from the pandemic. During our last work session, the FPU Board discussed uses of the funds if they were to be approved by TVA. We are proposing an across the board electric rate decrease as the most fair and transparent way to benefit our customers. We are still working with TVA to confirm this approach and will be sharing the details once this plan is finalized.” Appealing to the general importance of reliable network infrastructure, Dye added, “In terms of broadband investment within our community, FPU has and continues to make significant investment in this area. To date, Fayetteville Public Utilities has invested more than $3.5 million to provide internet to portions of our county (outside of the Fayetteville city limits).”

Dye’s letter then goes on to note key details in the work that FPU is already doing to improve internet access in Lincoln County, chief among which are that FPU will be contributing an additional $2.7 million to the aforementioned $3.5 million for broadband expansion and said project is anticipated to benefit 2,000 customers and businesses. To avoid confusion, it should be noted that neither the $3.5 million figure nor the $2.7 million figure refer to or include the $2 million TVA grant.

For clarity and a sense of scope, the Elk Valley Times has independently analyzed the statement that 2,000 customers and businesses will be benefitted. According to the United States Census Bureau, there is a total of 15,714 housing units in Lincoln County, Tennessee. If individual housing units are taken to be “households” and the aforementioned 63% figure is taken into account, this would mean that approximately 5,814 households are without high-speed internet access in the county. If FPU’s projection is taken to be wholly accurate, this would mean that roughly 3,814 households (or 24% of the county) would continue to be without high-speed internet access after completion of their project as it is currently conceived. It is crucial to note, however, that it is unclear if or to what extent these figures would change under different financial circumstances.

The Times reached out to Britt Dye for a statement on what reasoning led the FPU Board of Directors to apply the TVA funding to an electric rate decrease. The following is his response, in full: “While the FPU Board could have chosen to invest TVA’s Pandemic Relief Credit in electric infrastructure, they agreed that reducing electric rates to all classes of customers is the most fair and transparent way to benefit our customers.” In Dye’s responses to both the Times and Mayor Newman, “fair” appears to be the key word, as the electric rate reduction would benefit all FPU customers where broadband expansion would only benefit some.

A key fact that is not yet available, however, is just how substantial this rate reduction would be, but, as stated in Dye’s letter, such information can be expected upon TVA’s confirmation of the plan.