The city of Philadelphia and Verizon struck an agreement Tuesday that would allow the city to provide wireless Internet access as a municipal service even if Gov. Ed Rendell signs legislation to give Verizon the power to scuttle the project. It would allow the city to provide city-wide WiFi as a municipal service for a fee, according to KYW-TV and WNEP-TV. According to the AP, lawyers for the city and Verizon came to the agreement, today.

UPDATE: Governor Ed Rendall did sign House Bill 30, allowing incumbent telcos to kill municipal networks. Systems operational by Jan. 1, 2006 will be grandfathered in.

Details of a Philadelphia agreement were not immediately available, but it would guarantee that Verizon waives its right to bar the city from providing the service for a fee, both sides said. “We would waive our right of first refusal,” Verizon spokeswoman Sharon Shaffer said Tuesday, prior to an agreement being reached.

Ms. Shaffer provided Broadband Wireless Access World with this written statement , issued at 5:40 pm, Eastern Standard Time today, November 30, 2004, from Verizon:

“Verizon and the City of Philadelphia have reached agreement that resolves the concerns about the City’s ability to build a WiFi network in Philadelphia. The agreement itself is not being released. The execution of the terms of this agreement will make crystal clear that the City has the unimpeded right to build a WiFi network in Philadelphia as it sees fit. The City has communicated to the governor’s office that an agreement has been reached.”

This in-depth phone interview with Shaffer (about 20 minutes .wma) covers many details and implications.

Dianah Neff, the city’s chief information officer who is overseeing the wireless project, said the governor’s office had asked last week that Verizon and the city settle its differences over the bill.

House Bill 30 would have likely killed Philadephia’s “city cloud” project without a “grandfather” clause. November 30th was the final day he could veto it.

Verizon helped draft House Bill 30 [markup of bill], which would have essentially banned wireless “hot zones” run by municipalities in the state. Both Verizon and the city of Philadelphia have been discussing a compromise that would allow the city’s Wi-Fi plan to go forward, but would still ban other similar efforts in the state. Pittsburgh, apparently, will have to obey the Verizon Law — along with other cities in the state.

The Pittsburgh Wireless Neighborhoods Cooperative was formed to provide advanced network services to traditionally underserved communities. No cloud for you! Pittsburgh Wireless is the community lan group there (although pghwireless.com no longer seems to work).

Initiatives like ConnectKentucky.org, Kentucky Governor Fletcher’s prescription for a comprehensive broadband deployment statewide could come under fire if carrier lobbyists get there first. A Report of the Oregon Telecommunications Coordinating Council was presented to the Joint Legislative Committee on Information Management and Technology on November 16, 2004 for the Seventy-Third Legislative Assembly.

Other states have similar broadband plans. Most were created by legislators and carriers with the best of intentions. But the cost/effectiveness of WiMax and other wireless technologies is rarely factored in.

Philadelphia’s $10M Wi-Fi plan would expand access to the entire city — and to charge for it in some cases. The city projects a full deployment date of June 2006 with $1.5 million annually for upkeep.

Philadelphia’s Wi-Fi plan has received worldwide press attention along with some some bad press for Verizon and Pennsylvania legislators.

George Burrell, a top advisor to Mayor Street, says if Rendell signs the bill, some compromise with Verizon would likely be worked out:

“This is clearly an idea whose time has come, and it doesn t serve anybody well to be in the way of trying to create opportunities for people who would otherwise not be able to get access to technology. And I think Verizon recognizes that.”

Verizon, stung with bad publicity over House Bill 30, the bill to block Philadelphia’s WiFi “city cloud”, has marshalled their well oiled PR machine with a counter-attack:

Contrary to misleading claims by competitors, a recent telecommunications bill [House Bill 30] passed by the Pennsylvania General Assembly represents the most aggressive, comprehensive broadband network deployment plan in the United States, providing significant benefits for the state s consumers, as well as its educational and business communities.

House Bill 30 provides the right incentives and mechanisms to foster telecom competition, accelerate broadband deployment to meet customers needs and stimulate economic development, said O Rourke. We will continue to invest in broadband as aggressively as we can to help Pennsylvania become a national leader in technology deployment and telecom policy.

… This bill recognizes the ongoing changes in our industry and provides for fair and open competition for all broadband providers, said O Rourke. House Bill 30 brings the recently expired Chapter 30 statute in line with the competitive marketplace and creates a framework that encourages investment, innovation and risk-taking by the state s telecommunication providers.

The bill began 19 months ago as a proposal drafted by lobbyists for telecommunications companies. Wall Street Journal reports, House Bill 30 was originally prompted by the fiber deployment of a small town called Kutztown in Pennsylvania. But people involved in the legislative process say the provision took on added importance for legislators and the state’s big phone companies after Philadelphia announced its Wi-Fi plans.

The Information Communications Technologies Working Group — a 25-member committee composed of public officials, local telecommunications providers and non-profit advocates — say the question is not when but if the city should jump on the bandwagon.