The Federal Communications Commission is siding with Wilson against North Carolina, voting Thursday that the city’s Greenlight broadband service can be sold outside the city limits in a victory for so-called municipal broadband services.

State lawmakers four years ago placed limits on cities and counties offering their own Internet services.

The decision also is seen as a setback to cable companies that have fought against municipal broadband efforts.

“This is an important moment for communities in North Carolina, Tennessee, and other states that have barriers to local investments in advanced communications networks,” Jim Baller, the lead counsel for Wilson in the dispute, said in a statement. “Not only has the Commission confirmed that it has authority to remove such barriers, but it has also made clear that local Internet choice is critically important to the vitality of our communities and to America’s global competitiveness.”

The City of Wilson also embraced the decision, saying it will allow rural areas to get the super-fast Internet service many seek to remain competitive in the global economy.

“By its action today, the FCC has empowered local North Carolina communities to do whatever it takes for all of our citizens to realize the benefits of access to essential Gigabit infrastructure in our beautiful state,” Greenlight General Manager Will Aycock said in a statement. “All possibilities are now on the table, whether through public-private partnerships or municipally-owned broadband networks, to ensure North Carolina’s businesses and residents remain competitive in the global economy.”

Baller also represented the city of Chattanooga, Tenn., which faced similar state restrictions after building its own fiber network.

North Carolina is among 19 states that have laws against cities and counties setting up their own broadband infrastructure, and President Barack Obama had said earlier this year he wants the FCC to override those laws.

Republican U.S. Sen. Thom Tillis of North Carolina and Congresswoman Marsha Blackburn of Tennessee immediately drafted legislation that would prevent the FCC from overriding state and local municipal broadband laws.

“It is disturbing, yet not surprising, that the FCC and Chairman (Tom) Wheeler are attempting to deny the sovereign right of states to make their own laws,” Tillis said in a statekment. “After witnessing how some local governments wasted taxpayer dollars and accumulated millions in debt through poor decision-making, the legislatures of states like North Carolina and Tennessee passed common-sense, bipartisan laws that protect hardworking taxpayers and maintain the fairness of free-market competition.”

North Carolina Congresswoman Renee Ellmers and congressmen David Rouzer, Robert Pittenger and Mark Meadows are co-sponsors of the bill.

Frustrated by its inability to attract Internet service providers to the city, Wilson leaders borrowed $35 million in 2008 to build Greenlight, saying the service would be crucial to the city’s economic future. Aycock said it has helped recruit new business to Wilson.

Various groups wanting more broadband access hailed the decision.

“Cities can’t compete in a global economy without robust broadband infrastructure, Joshua Stager, policy counsel for New America’s Open Technology Institute, said in a statement. “Local government can play a critical role in network development, particularly in areas where incumbent providers are not meeting local needs. Indeed, our research has consistently found that some of the fastest and most affordable broadband in America comes from community networks. All localities should be free to make these kinds of smart investments in their own infrastructure.”

“Bandwidth should not be a barrier to innovation, nor outdated regulation a barrier to investment,” Heather Gold, president of the Fiber to the Home Council Americas, said in a statement.