KentuckyWired Denies Accusations from Municipal Utilities

The Kentucky Communications Network Authority (KCNA) testified Friday morning that KentuckyWired is 98% complete. The progress update followed accusations in which municipal utilities accused OpenFiber/Accelecom, KentuckyWired’s business entities, of cherry-picking key customers. OpenFiber/Accelecom Chief Executive Officer David Flessas denied those accusations. “We are not looking to supplant municipal cooperatives,” insisted Flessas. “Our network and their network are much more complementary than they are competitive.”

On Thursday, cities that provide internet service voiced concern before the Interim Joint Committee on Tourism, Small Business, and Information Technology. They asked legislators to establish rules to keep OpenFiber/Accelecom from trying to take municipal utility customers.

At Friday’s hearing, committee cochair Representative Lynn Bechler (R-Marion) asked Flessas if KentuckyWired is trying to compete with local utilities. “We will end up being in competition with local service providers,” Flessas answered. “I don’t think that’s a new situation for any of them because we are all aware there are generally multiple service providers in any particular area. We are very optimistic and looking forward to working with those providers. There are a lot more services that we are not well-positioned to provide than we are, and that includes local business, local voice, small and medium business, residents, etc.”

KentuckyWired Executive Director Mike Hayden described “small gaps” in the final broadband rings: southwest of Louisville, between Paducah and Princeton, and between Murray and Hopkinsville. He hopes contractors will close these gaps by year’s end.

Hayden testified that many executive branch agencies have migrated to KentuckyWired, and all 877 should be on the system by the first quarter of 2022.

KCNA Chief Financial Officer Steven Murphy told Bechler that construction expenses as of June 2021 totaled $291 million, with another $25.3 million spent on equipment and $93 million paid in a settlement. Those figures brought the project’s total cost to $407 million. Murphy said he would have an updated cost after October 1.

Also Friday, State Budget Director John Hicks updated the committee on the effort to fund broadband for unserved and underserved Kentuckians. He said the request for proposals (RFP) period remains open until October 25.

The General Assembly appropriated $300 million from the American Rescue Plan Act (ARPA) Coronavirus State Fiscal Recovery Fund to deliver the service. Hicks said the Federal Communications Commission (FCC) map designating areas as unserved and underserved is incomplete and may not get finalized until the RFP closes.