MON AM News: Broadband task force pushing for more state investment; MMAC survey finds ‘lackluster’ outlook

July 29, 2024

— The Governor’s Task Force on Broadband Access is pushing for more state funding to expand broadband in Wisconsin, arguing “federal funds alone won’t solve internet access issues” for state residents.

The task force on Friday issued its fourth annual report, providing an update for ongoing state efforts around improving internet access as well as preparations for the more than $1 billion Wisconsin is receiving through the federal Broadband Equity, Access, and Deployment Program, or BEAD.

Starting next year, competitive BEAD subgrants will be awarded under the program’s timeline at the state Public Service Commission website.

The task force’s report includes a number of recommendations for preparing for this process, such as: supporting training and credentialing for the workforce needed for broadband infrastructure development; streamlining grant administration; supporting permitting coordination between the federal government and internet service providers, and many more.

The report also calls for investing more state budget dollars for broadband expansion “address gaps left behind” in the BEAD allocation process, as well as considering line extension funding to support broadband installations.

The task force is urging targeting “areas where experienced speeds differ from advertised service due to aging and less-reliable technology, and where prior federal funding awards default and are left incomplete.”

To support affordability and adoption of high-speed internet, it’s calling for updating grant criteria under the State Broadband Expansion program to include cost of service or affordability for low-income households, among other changes.

And the group wants state officials to advocate for federal action to fund the Affordable Connectivity Program. A release from Gov. Tony Evers noted federal lawmakers “failed to extend” the ACP program, which included one in every six Wisconsin households in February of this year. The monthly benefit — $30 per month for eligible households and up to $75 per month for qualifying households on tribal lands — ended in June.

Evers’ release notes the governor has allocated more than $345 million in state and federal funds to expand high-speed internet, supporting new and improved internet service for more than 410,000 homes and businesses.

“I’ll be calling on the Legislature to make real, meaningful investments in broadband in our next budget so we can continue building the 21st-century infrastructure Wisconsinites need and deserve,” Evers said in a statement.

In his previous budget proposal, Evers recommended allocating $750 million in state funding to supplement the federal funding, but he notes that didn’t make it into the final budget.

He also notes “we’ve got more work to do,” as Wisconsin still has more than 180,100 unserved locations and 195,200 underserved locations.

See the release and report.

— The third-quarter outlook among Milwaukee-area business leaders is “lackluster,” the latest MMAC survey finds.

The Metropolitan Milwaukee Association of Commerce on Friday released its latest quarterly outlook report, which shows 49% of businesses surveyed expect higher real sales levels in the third quarter compared to last year. Another 32% expect sales to decline and 19% expect no change.

While the share of those expecting sales gains is up from 44% for the second quarter, the survey marks the fourth consecutive quarter that less than half of respondents expect sales to increase in the near future.

“While optimism remains low by historical standards, there has been some modest improvement in the quarter-to-quarter trend, particularly in regard to sales and profit levels,” said Bret Mayborne, MMAC’s vice president of economic research. “Whether this momentum translates into stronger second-half business growth is still an open question.”

Forty-two percent of respondents expect to add jobs in the third quarter, while 24% expect job declines and 34% predict no change. MMAC notes businesses are “somewhat less optimistic toward job prospects” than in the previous survey, which had 48% expecting second-quarter job gains.

Both manufacturers and large businesses with 100 or more employees generally are more optimistic about third-quarter employment trends, with 50% and 54% predicting job gains, respectively.

Looking ahead to the entire second half of 2024, plans for capital spending “remain low,” MMAC found. While 25% expect to increase capital spending, 24% predict lower capital spending and 51% expect no change in their capital spending.

“Those currently expecting 2024 increases rank well below the 43% who forecast such gains at the beginning of 2024,” report authors wrote.

MMAC’s survey tapped 63 firms from the Milwaukee area that collectively employ more than 13,000 people.

See the full survey results.

— A lack of housing inventory in Milwaukee is driving ongoing racial disparities in home ownership, according to a leader of the city’s Community Development Alliance.

Teig Whaley-Smith is chief alliance executive for this organization and an adjunct associate professor of law at Marquette University. He spoke Friday during a Wisconsin Policy Forum webinar focused on housing affordability and related challenges in the state.

“For the first time in decades, we’re actually seeing an increase in Black and Latino homeownership in Milwaukee, which is super exciting,” he said. “But we can’t possibly maintain that growth and make up for all the losses in the past, because we don’t have enough inventory. The lack of inventory is making us continue to be a very segregated city.”

An earlier report from the Wisconsin Policy Forum found all of Wisconsin’s major cities have large racial gaps in homeownership rates. In Milwaukee, the owner-occupancy rate was 56% for white residents, 37% for Hispanic residents and just 27% for Black residents.

“We have had the highest cost increases in the Midwest, and we’ve had displacement of owners by predatory investors and short-term rentals in our housing market,” he said. “And so really the next step is how do we boost inventory.”

He touted a citywide planning effort called Growing MKE, led by the Department of City Development, which would make changes to Milwaukee’s zoning code to allow for “a wider mix of housing types” across all neighborhoods, according to a July 15 draft plan. Plan authors say the proposed changes “aim to improve equity by increasing the amount of affordable and attainable housing for all.”

Whaley-Smith argued low housing inventory is a racial equity issue, as it drives cost increases and “people of color bear the brunt of that cost.” He also referenced the city’s history of discriminatory zoning designed to exclude communities of color from certain communities.

The plan will “allow for additional housing use types and density in high-demand areas, so they don’t cause displacement, but also slowly increasing the density throughout the rest of the city without displacing people,” he said. That includes allowing families to add new dwelling units onto their homes, he noted.

See more program details.

— The head of Stark Company Realtors in Madison says south central Wisconsin’s housing market is “functioning reasonably well” despite an ongoing shortage of homes.

CEO David Stark in a recent newsletter said the market has “settled into somewhat of a groove,” as the impact of higher borrowing costs has diminished and buyers adjust to the higher mortgage rate environment.

While a lack of housing inventory is the top challenge, the region has seen its first bright spot on this front since the pandemic, Stark notes.

Dane County now has 1.5 months of inventory — up 40% over the year — and Sauk and Columbia counties have 2 months of inventory, an increase of 23%, according to his report.

“While that’s still well below what would be considered a ‘balanced’ market, it’s the first meaningful increase in the last four years,” he wrote.

Meanwhile, residential sales in Dane County were 9.5% higher in the second quarter and 6% higher for the year. For Sauk/Columbia, those increases are 14% and 10.5%, respectively. But June sales were 7% lower over the year in Dane County and 15% lower for Sauk and Columbia counties, which Stark says is surprising.

“June is normally the busiest month of the year for closings, and the expectation was that the momentum from earlier in the year would continue,” Stark wrote. “Perhaps June was just a blip, and we’ll continue to grow in July and beyond.”

While he emphasizes that one month doesn’t make a trend, he also questions if “resistance to rising prices” is slowing the market. Data from the coming months will determine if that’s the case, he wrote.

See the newsletter.

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