Upton Sinclair's "It is difficult to get a man to understand something, when his salary depends upon his not understanding it" seems relevant here.
It's illegal, but it's also murkey enough that it can be made effectively exclusive through permitting delays, etc.
If the incentives were flipped (say, a federal road fund multiplier that scaled with average speed * number of options), I feel like we'd have a lot more competition.
As is, in the contracts I've read, they're essentially "ISP gets a non-exclusive franchise right in exchange for paying local government x% of their fees from the area, and both parties agree that the portion rebated to the local government may not be separately itemized on the bill."
Which sets up some pretty perverse incentives for most part-time commissioners.