Bohnak plan would create state tax exemption for broadband expansion grants

State Rep. Karl Bohnak on Wednesday secured House passage of his plan to expand high-speed internet connectivity in the U.P. and across Michigan. The Michigan Broadband Accessibility Act, House Bill 4287, would maximize the impact of broadband grant funds, ensuring critical connectivity infrastructure is extended to as many communities and Michiganders as possible.

“In today’s increasingly digital world, a lack of reliable access to the internet can place a huge burden on residents and communities at large,” said Bohnak, R-Deerton. “At the household level, internet is often needed for at-home telehealth care, online banking, remote work, homework, and other aspects of day-to-day life where connectivity has become more of a need than a want. On a larger scale, the U.P. and Michigan are losing population at an alarming rate. That trend isn’t going to be reversed if a significant number of communities don’t have reliable connectivity. What young family is going to move into a town where they have to drag their kids to the local library every time they need to get online?”

Digital deserts – regions with little to no reliable internet access – have become a significant concern in rural communities. Recent reports have found that less than 50% of homes in several U.P. counties have reliable internet access. Because of this rising concern, various state and federal grant programs have been implemented to encourage broadband providers to expand access into rural areas. However, under Michigan tax law, these grants are considered income and not tax-exempt.

Bohnak’s plan would create a tax exemption for all broadband grants. The exemption would ensure a tax-free process for companies and organizations to leverage broadband grants to expand high-speed internet access. The legislation is supported by Democrats and Republicans.

The bill now moves to the Senate for further consideration.

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