In the 1930s, rural communities joined together through electric cooperatives to bring electricity to their homes and businesses. Today, rural electric co-ops may have the power to bring Internet access to these same communities.

A recent Broadband Communities Magazine article highlights this potential for rural electric co-ops. In the article, Dr. Robert Yadon and D. Bracken Ross of the Digital Policy Institute at Ball State University explain the results of their recent study. 

Electric Co-Ops as Regional Networks

Yadon and Bracken looked into 30 private sector Fiber-to-the-Home (FTTH) providers in Indiana and 16 rural electric co-ops providing Internet service around the nation. After predicting engineering costs, the researchers highlighted a dozen Indiana rural electric co-ops that could serve as regional hubs of connectivity.

The researchers developed a specific process for rural electric co-ops interested in providing Internet access. In summary, they propose:

“For REMCs [Rural Electric Membership Cooperatives], the process begins with a commitment to a middle-mile, smart grid fiber deployment connecting their substations, followed by a phased-approach business model with strategic growth focusing on last-mile customer density. Exploring local business partnership underwriting opportunities, examining the use of an efficient regional network design and combining multiple federal funding programs are the keys to rural broadband deployment success down the road.”

We don’t necessarily agree with these proposals. Our Christopher Mitchell has written many times about how middle mile cannot solve the last mile problems. The incremental approach based on customer density can repeat some of the same problems we’ve seen with cable and telephone companies - skipping over the most rural and smallest localities. Relying on federal funds is not always necessary. In fact, the researchers point to the success of a co-op that continued on after being denied a federal grant.

Pioneering Electric Co-Ops are Models

The Land of 10,000 Lakes wants to become The Land of 10,000 Lakes With High-Speed Internet Access. 

The Minnesota Department of Employment and Economic Development (DEED) will begin taking applications for the Border-to-Border Broadband Development Grant Program on July 22, 2016. The program offers a total of $35 million in funding for projects in unserved and underserved areas. The application submission period closes on October 3, 2016.

The Grant Program

The Border-to-Border program will pay for up to 50 percent of project development costs, awarding a maximum of $5 million per grant. This round of funding sets aside $5 million specifically for underserved areas, and $500,000 will be set aside for areas that contain a significant proportion of low-income households. Officials estimate this year's $35 million in funding will impact an additional 2,000 Minnesotans.

Since May 2014, the Border-to-Border program has provided over $30 million in assistance to over 30 projects throughout Minnesota. This latest funding opportunity brings the total funding up to $65.4 million. It is the largest funding appropriation for the program to date.

Still Not Enough

The Governor’s Task Force on Broadband estimated that Minnesota needs $900 million to $3.2 billion of investment to bring high-speed Internet access to all in the state. The latest funding for the Border-to-Border program, although more than past years, is still not enough. Minnesota Lieutenant Governor Tina Smith stated:

“Broadband isn’t nice, it’s necessary if we want Minnesota’s economy to work for everyone, everywhere in the state. This new investment will connect businesses to customers, students to learning opportunities, and patients to their doctors. This is an important investment but we have a long way to go...”

Learn more about the Border-to-Border program and our suggestions for how to improve it by downloading our May 2016 policy brief Minnesota's Broadband Grant Program: Getting the Rules Right. 

This 4th of July weekend invites us to celebrate the accomplishments of our country. But, 23 million people in rural areas remain without high-speed Internet access.

Rural areas cannot stay unconnected. Agriculture has become a high-tech endeavor, and high-speed Internet access is necessary. Cooperatives, those democratic institutions formed by rural farmers years ago, are becoming an answer.

The Founding Fathers considered rural communities the life-blood of the country. In 1785, Thomas Jefferson, in a letter to John Jay, stated that:

“[C]ultivators of the earth are the most valuable citizens. they are the most vigorous, the most independent, the most virtuous, & they are tied to their country & wedded to it’s liberty & interests by the most lasting bands.”

High-Speed Internet Access Supports Agriculture

The Missouri Farmer Today recently wrote ofthe sorry state of rural Internet access for one family-owned business in Missouri, the Perry Agricultural Laboratory. They process soil samples and perform other agricultural testing for both local and international customers but the best connections available are via satellite. The lab constantly goes over its data cap and sometimes cannot send their reports to customers across the globe if the weather interferes with their signal. A high-speed cable runs along the edge of the property, but the company would have to pay $40,000 to connect to it.

Nonprofit Old Town Orono Fiber (OTO Fiber) is awaiting responses to a recently posted broadband survey. A fiber-optic network is in the works for both Orono and Old Town, but funds are limited. Local officials seek input from local residents and business to “determine both the interest in this project and where the Internet infrastructure would need to be established.”

Approximately 7,800 people live in Old Town; a little over 10,000 people are in Orono and there are also over 11,000 University of Maine students who attend classes there.

Old Town, Orono, and the University of Maine lost a funding battle against Time Warner Cable in 2015. That incident dealt with an area where only about 320 potential subscribers could be served with approximately four miles of fiber. A recent $250,000 grant from the Northern Border Regional Commission put the consortium back on track to finish that project. OTO Fiber is now gathering more information about where to best deploy a broader network; they have funding for about six miles of fiber in each community.

Locals are enthusiastic about high-speed fiber’s potential benefits to the community. OTO Fiber’s survey page states, 

“The purpose of having this infrastructure in our community is to bolster existing businesses that can take advantage of this connectivity and to attract and foster entrepreneurs, students and recent graduates to create new businesses and enterprises that rely on high-bandwidth connectivity. To help us advance this project, please complete one or both of the following surveys.”

A fast, reliable, affordable connection can promote job growth and keep college-age talent in the region. Residents can look forward to symmetrical high-speed connections (the same speeds on the upload and the download) that will open the door to improved video streaming, telemedicine, virtual reality gaming, and a number of other high bandwidth technologies.

In Colorado, the Delta-Montrose Electric Association (DMEA) saw record crowds at their Annual Meeting of Members. Hundreds of people came to check out the event on June 16th and try out the super fast speeds of Elevate Fiber, DMEA’s Fiber-to-the-Home (FTTH) project.  The project will bring speeds of up to a Gigabit per second (Gbps) to DMEA’s 27,000 members. 

Elevate Fiber

During the event, members were able to check out the speed in person and preregister their homes and businesses. It requires a 12-month contract at a minimum of $49.99 each month according to the DMEA’s website. Residents can sign up at https://join.elevatefiber.com/. 

Providing Internet access is a new role for the electric cooperative but DMEA has a plan: the co-op will build out the fiber incrementally. Phase I will encompass about 7,500 homes and businesses in Paonia, Cobble Creek, and the Montrose downtown business district. These locations are test cases of overhead and underground installations in urban and rural areas. 

Celebrate the Times

The Montrose Press reported that over 500 people came to the meeting, making it one of the largest in recent memory. The Annual Meeting of Members celebrated the past accomplishments of the co-op and looked ahead to the fiber future. In addition to free hamburgers and hot dogs, and an appearance by former American Idol contestant Jeneve Rose Mitchell,* attendees could see live demonstrations of Elevate Fiber.

In December 2015, the DMEA Board of Directors unanimously voted to proceed with the FTTH project. At the time, they considered building a middle mile network, but wisely chose to deploy last mile connectivity to members' homes and businesses.

The League of Minnesota Cities has honored ten communities in the south central part of the state for their role in assisting to launch the RS Fiber Cooperative.

At its annual state conference on June 16th, the League awarded its “City of Excellence Award” in the 5,000 to 19,999-population category to the cities of Brownton, Buffalo Lake, Fairfax, Gaylord, Gibbon, Green Isle, Lafayette, New Auburn, Stewart, and Winthrop.

 In a news release, League officials said: 

“These 10 cities, along with 17 townships, worked collaboratively for five years to provide South Central Minnesota residents with access to high speed, affordable, and reliable “gigabit internet service. The cities created a joint governance structure that aligned local taxpayer interests across entities, and initiated a public/private financing structure that enables residents to obtain internet broadband services at minimal risk.

The cities developed grassroots support for the project by hosting more than 150 meetings and by personally contacting hundreds of residents, local businesses, and government officials. Over the next five years, thousands of households and rural farm sites and hundreds of businesses and community organizations will be able to receive high-speed internet service access that greatly exceeds previous services provided by national telecommunications firms.

Communities need reliable broadband access to attract and retain new businesses and residents. The success of the “RS Fiber Cooperative Project” confirms the value of small communities working together with private interests to make a positive difference in lives of constituents.” 

Mark Erickson, former Winthrop city manager who was instrumental in developing RS Fiber, told us he was excited about the award.

"It was a cool award to get; an important recognition for our little towns," said Erickson, currently Winthrop economic development director. "I'm just proud of the mayor and councils in the ten communities for having the vision and patience to make the RS Fiber project happen. When communities take steps to insure better futures for their residents, good things can happen."

Salisbury’s fiber network, Fibrant, is about to connect to three more large customers in North Carolina.

The Salisbury Post writes that Rowan County government and two local manufacturing facilities will be connecting to Salisbury’s municipal fiber network. After considering the needs of several local manufacturers and the Rowan County Government, Rowan County Commissioners gave the necessary approval to expand Fibrant to serve their facilities.

Local Manufacturing Wants Fibrant

The manufacturing facilities, Gildan and Agility Fuel Systems, are both located outside of Salisbury’s city limits, but within Fibrant’s service area. State law requires they obtain permission from the Rowan Board of the Rowan County Commissioners to allow Fibrant to extend service to their location.

Rowan County government also wants to connect to Fibrant and the same law applies to them. The County will use Fibrant as a back-up to their regular Internet connection for a while before deciding if Fibrant should become their primary service service provider.

Meanwhile, Gildan and Agility Fuel Systems just want the high-speed and reliability of the Fibrant network. Gildan is a Canadian manufacturer that makes activewear clothing. Since 2013, the company has worked to expand its existing yarn spinning facility, bringing skilled manufacturing jobs to the region. Agility Fuel Systems makes alternative fuel systems for large trucks. Currently, Agility Fuel Systems uses a connection speed of 20 Megabits per second (Mbps). Fibrant can offer capacity connections up to 10 Gigabits per second (Gbps).

The Agility Fuel System’s North Carolina Director of Operations, Shawn Adelsberger, actively pushed for a Fibrant connection. According to the Salisbury Post, Adelsberger wrote to Rowan County in May:

In western Massachusetts, 44 small towns continue the push for high-speed, high-quality Internet access. WiredWest (a cooperative of these town’s municipal light plants) has been ramping up the pressure on the state. They need funding to build a regional network, but a state agency has been reluctant to distribute money.

To update everyone on the ever-changing situation, WiredWest has launched a revamped website, focusing on the latest news and most relevant information. Bookmark WiredWest.net to keep informed.

WiredWest and MBI? It’s A Long Story

WiredWest began in 2010 as folks gathered together to bring better connectivity to their unserved and underserved communities.  They wanted a regional Fiber-to-the-Home (FTTH) network that would bring future-proof fiber optic technology into their homes. After years of working on business plans and creating a governance structure to represent all the towns, WiredWest hit a major roadblock erected by a state agency.

The Massachusetts Broadband Institute (MBI) is in charge of distributing state funding to project that will improve Internet access in the state. Previously, the agency had built a middle-mile network (which connects community anchor institutes and could serve as a backbone for FTTH networks). When WiredWest asked for state funding to help develop its fiber infrastructure, MBI stalled the process – to the point that even the governor’s administration got involved. The agency has made some decisions about which projects it will help fund, but its choices have been criticized.

The Minnesota Legislature has just approved $35 million for the Border-to-Border Broadband Development Grant program for fiscal year 2017, the largest annual appropriation in the initiative’s two-year-old history.

But the Legislature’s action still falls short of dramatically helping bring universal, high-speed Internet connectivity to all non-metro Minnesotans. Try to find a Representative or Senator that doesn’t talk about how important rural Internet access is, but compare that list to those who are actually voting for solutions. The Blandin on Broadband website captured a glimpse of this dynamic in a recent post. 

Nice Gains And Noticeable Failures

The Legislature headed in the right direction this year to increase overall funding for broadband development. But we believe the Legislature’s action, which is moving at a snail’s pace, won’t help thousands of residents and businesses in Minnesota’s non-metro communities hurdle over the connectivity chasm. 

The state’s elected leaders also made changes to the program – some good and some bad – in the way projects are selected and the challenge process. 

Funding Fizzle? 

First, the funding fizzle. In its first two years, the state awarded about $30 million to 31 Border-to-Border projects. But that has been a miniscule appropriation compared with the Governor’s Task Force on Broadband’s estimate that Minnesota’s unmet broadband need is $900 million to $3.2 billion.

And the Legislature’s $35 million funding for the broadband grant program for the upcoming fiscal year seems particularly paltry given that the state has a projected $900 million budget surplus. 

“We are disappointed with the [broadband funding] number and the incredibly restrictive language” on eligibility for grants, said Dan Dorman, executive director of the Greater Minnesota Partnership, (GMNP), a non-metro economic development group established in 2013 that successfully lobbied for the creation of the Broadband Development Grant program. 

Sandpoint, Idaho, located in the state’s panhandle, is likely to host Ting’s Internet service over publicly owned Fiber-to-the-Home (FTTH) infrastructure. All that remains is for the service provider to determine that the demand exists in the anticipated service area of approximately 9,700 people. In addition to residents and businesses in Sandpoint, properties in nearby Dover, Ponderay, and Kootenai are anticipated potential subscribers.

Sandpoint, Idaho

Approximately 7,500 people live in the city, which is the Bonner County Seat. The community is popular as a ski resort town and is located on Lake Pend Oreille. In addition to tourism, the manufacturing, aerospace, software, and healthcare industries are important employers in Sandpoint. It covers approximately 4.8 square miles and, five years ago, was named “most Beautiful Small Town” by Rand McNally and USA Today.

Seeking Assistance Moving Forward

The city has recently issued a Request for Proposals (RFP) to find a firm to propose a plan to make the best use of their existing dark fiber network. According to the RFP, Sandpoint is looking for consultants to help them engage in conversations with stakeholders and providers, determine the city’s assets, use their assets for maximum economic development, and a variety of other tasks.

Sandpoint has had an existing conduit system in place for some time but, according to the RFP, has not been “proofed” and may not be suitable for larger cables. The city also has an underground fiber backbone and is in the process of installing more fiber-optic cable.

Bonner County also owns conduit within Sandpoint that can be accessed as part of the town’s project. The RFP describes more conduit in and around the city and Sandpoint’s preliminary plans to use it to improve local connectivity.

Important dates: