The Free State Foundation has a big issue with the way the House Ways & Means Committee is reconciling President Joe Biden's $3.5 trillion spending plan, which includes big bucks for broadband.

Both houses of Congress have passed a general outline of the budget, but committees in both chambers are now charged with filling in matching details. 

Randolph May, president of the Potomac, Maryland-based free-market think tank, is calling ill-conceived a provision that would provide a tax break to municipal broadband buildouts.

Also Read: More Muni, More Money

The president has favored such municipal broadband in his proposals for billions of dollars in subsidies to promote universal, affordable and competitive high-speed internet service.

But May said Congress should not give a tax break for the maintenance and operation of government-owned broadband systems.

One knock on such systems historically has been that once funded, they can't cover operating expenses and have been known to fold, leaving taxpayers to foot the bill.

Also Read: Biden Broadband Plan Favoring Government-Owned Networks Lacks a Constitutional Foundation

But May said government-owned networks already get preferential treatment when it comes to “accessing public rights of way, avoiding cumbersome permitting processes, and benefitting from taxpayer-funded subsidies.”

He said the tax break would make it harder for private operators who have to invest their own risk capital to upgrade service. “Marketplace competition for broadband services would be dampened and consumers will be the losers” if the tax break for munis is granted, he said.

Local broadcasters are urging the Senate to provide tax credits to stations that staff up their newsrooms, citing, in part, Big Tech's "devouring" of their local ad market.

In a letter to Senate leadership, all 50 state broadcaster associations called for passage of the Local Journalism Sustainability Act.

They said the bill "would provide local newsrooms a lifeline that would enable them to sustain, and in some cases, significantly improve the critical public service these local media outlets provide their communities."

The associations said that lifeline is needed in part because their advertising market has been disappearing, "devoured by massive online technology platforms."

The bill, which was introduced last month by Sen. Maria Cantwell (D-Wash.), chair of the Senate Commerce Committee, along with Sens. Mark Kelly (D-Ariz.), and Ron Wyden (D-Ore.), would provide tax breaks for stations as well as small businesses that support local media with their ad dollars.

Also Read: Local TV News Employment Up During Pandemic

The goal, according to the bill's sponsors, is to "revive and sustain trusted local media," in which broadcast TV and radio play a central role. The credits go to support local newspapers, digital news operations, TV and radio.