Blandin Webinar Archive: Broadband Finance Strategies

Webinar April 2017 Broadband Finance Strategies
April 27, 2017 03:00 PM

Financing public sector investment in broadband projects can be complex, requiring both financial and political accountability. Learn from finance and local economic experts about how these deals are put together.

Speakers include:

  • Shannon Sweeney, David Drown Associates
  • Paul Donna, Robert W. Baird & Co.
  • Nancy Hoffman, Chisago County HRA-EDA
  • Mark Erickson, City of Winthrop

Home grown technology-spurred innovation: Live.Give.Save – the FitBit for finances

Our friends at Red Wing Ignite are celebrating a local win …

Last week four southern Minnesota entrepreneurs pitched their businesses to judges at the second annual Ignite Cup business competition. The winner, Susan Sorensen Langer, founder of Live.Give.Save., will go on to be an automatic semi-finalist at Minnesota Cup, the nation’s largest startup business competition. Live.Give.Save. is located in Red Wing and is a member of Red Wing Ignite.  The other businesses participating were Thaddeus Medical Systems, How to Babysit and Rad-Path.  The Ignite Cup is a way to encourage southern Minnesota entrepreneurs to take the next step. It is a collaboration of community builders, including Red Wing Ignite, Mayo Clinic Business Accelerator, Minnesota Department of Employment and Economic Development (DEED) and Southern Minnesota Initiative Foundation (SMIF).

Here’s a little bit more about Live.Give.Save …

Live.Give.Save. calls itself the “Fitbit” of personal finance. Its mobile-first technology enables people to spend wisely, save for a secure future and help others in need without changing behavior.  Live.Give.Save seeks to address the problem that 62 percent of Americans don’t have an emergency savings for a $1,000 hospital visit or $500 car repair and the 50 percent of Americans not saving for retirement.

And their take on how valuable it is to have infrastructure around to support good ideas …

“We appreciate the great partnerships which enable events at Red Wing Ignite to take place,” said Pam Bishop, Vice President of Economic Development. “Events like the Ignite Cup and Minnesota Cup greatly benefit our work of economic development; the energy and innovation our region’s entrepreneurs provide are crucial to regional vitality.  “Winning the Ignite Cup, earning a spot as a semi-finalist at the prized MN Cup, blew a big burst of wind in our sails,” said Langer, founder of Live.Give.Save. “The exposure alone is immense. Much like Shark Tank, just being a presenter (at MN Cup) offers tremendous opportunity to connect with much-needed resources. Being part of Red Wing Ignite in 2015 was the best business decision I made.”

Usually when I talk about infrastructure I mean broadband and Red Wing has plenty with the partnership with HBC. But this heads up from Red Wing Ignite is a reminder that ideas aren’t made from broadband alone, Ideas need support with marketing, training, tech support, financial acumen and sometimes just a little cheer leading!

What do rural Minnesotans think? Broadband is essential!

Yesterday the Minnesota Farmers Union unveiled their report – What Do Rural People Think? It is the distillation of 14 conversations in 14 rural communities held between March 27 and April 6, 2017.

Here’s the quick summary (broadband is #3!)

Since the 2016 national, state, and local elections, there seems to be an ever-present question on the minds of policymakers, elected officials, the media, and organizations of all kinds: What do rural people think?

  • $43,429 per year is too much to pay for health insurance that you don’t use.

  • St. Paul politicians need to come out to rural Minnesota to listen to us about what works, and what doesn’t work, before they tell us what to do with our farms.  Rural people need to be consulted, not told.

  • Broadband Internet is an essential utility, like electricity.  It has to be affordable and available throughout all rural areas if we are going to survive and thrive.

  • Rural Minnesota does not deserve to be left behind on transportation, roads, bridges, healthcare, wages, and everything else.

  • We need to be able to pay rural health care workers more for their work in nursing homes, homes, and healthcare facilities. Right now, big box stores pay more than health care jobs can pay them. It’s our people being taken care of in those nursing homes.

  • Politicians need to really get out here and listen to us; not listen and tell; just listen and hear.

And here is what they say more specifically about broadband:

Broadband in rural Minnesota is an essential utility

High speed broadband internet is not a luxury for family farmers and rural communities.  Without it, farmers and communities cannot retain residents, or be a part of the world’s economy.  Additionally, without adequate internet, youth cannot compete with the rest of the country, to complete homework or education programs.  Farmers need it for everything ranging from working with FSA to communicating with state government to running their farm’s operations.  As more than one person indicated, broadband internet needs to be considered an essential utility, and significant state and federal funding is required in order to make it universally available.

MN Conference Committee on SF1937 Broadband Update – sounds like more next week

Today I attended the Conference Committee on SF1937. The high level takeaway? They are working on the bill. They are hoping for a conference committee meeting scheduled early next week. I will keep an ear to the ground and will hope to attend, take notes and livestream if the session isn’t already being broadcast.

Here are today’s documents (from the legislature website):

 

Conference Committee on SF1937 (Omnibus that includes broadband) to meet Wed April 26 at 4 pm

I am hoping to attend and to take notes. You can find video and notes from the last meeting here.

Wednesday, April 26, 2017 – 4:00 PM

Conference Committee on S.F. 1937
Chairs: Sen. Jeremy R. Miller and Rep. Pat Garofalo
CONFEREES: SENATE: Miller; Anderson, P.; Champion; Dahms; Osmek – HOUSE: Garofalo; O’Neill; Mahoney; Hoppe; Newberger
4 p.m.
Room 1100 Minnesota Senate Bldg.

Representative Garofalo will Chair the meeting

Agenda:
S.F. 1937-Miller: Omnibus jobs, commerce, energy, labor and industry, and employment and economic development appropriations bill.

Broadband feasibility studies are a step toward grant applications, RFPs, getting networks built!

Last week, the MN Broadband Task Force heard from practitioners on the utility of feasibility studies. I’m on the Task Force and found the topic interesting and worth a deeper dive, especially given Blandin Foundation’s experience with and commitment to the feasibility study as a key step in moving a broadband project closer to reality.

Since 2007, Blandin Foundation had provided matching grants totaling $718,321 to 24 rural Minnesota communities to support the cost of a broadband feasibility study through its Robust Network Feasibility Fund. This grant program requires communities to produce a one-to-one cash match for awarded grants.

In 2013, Blandin Foundation published Lessons from Rural Minnesota Broadband Feasibility Studies: What can rural communities learn about broadband expansion, based on feasibility studies completed to date?” It looks at grants made between 2007 and 2012 to 11 communities to fund broadband feasibility studies, and identifies some best practices and recommendations for maximizing the effectiveness of such studies.

Five of these funded communities have gone on to deploy broadband networks; six have not.

The difference: access to capital.

Four of the five communities were able to build networks based on their completed studies due to ARRA (American Recovery and Reinvestment Act) funding. (Actually four networks were deployed, as two communities with feasibility studies became one ARRA project.) Having feasibility study results in hand played a key role in positioning the awarded communities to be competitive for federal funding.  The studies provided the communities with the data required in the application process and demonstrated that they were shovel-ready projects, which was a major requirement of projects seeking ARRA funding.

One community, Red Wing, successfully deployed a fiber optic network without ARRA funding, through partnership with Hiawatha Broadband Communications. HBC applied for ARRA funding, but was not awarded funds. Despite this setback, HBC moved ahead with the Red Wing project using their own source of funds.

State broadband funds were not available at this time, so that was not an option for communities.

In 2013, Blandin Foundation made three more broadband feasibility study grants:

As communities and counties increasingly feel the pain of being left behind, Blandin Foundation is experiencing increased demand for feasibility study grants.

In 2015-16, Blandin Foundation funded broadband feasibility studies in 10 communities.

The grant applications for this round of feasibility studies all emerged from an inclusive community engagement process.  Community members identified the need to conduct a study in order to move ahead on their technology goals and then shaped the study’s purpose, goals, and scope, and selected a consultant.

Broadband networks are now being built in six of the 10 communities that conducted feasibility studies in 2015-2016; four with state grant dollars, and two without.

Some conclusions I draw from this experience:  

  • Feasibility studies can be an effective tool in helping communities advance their broadband goals.
  • Feasibility studies inform both sides of prospective partnerships: public sector leadership and private sector providers.
  • Feasibility studies should be designed to drive decision-making throughout an interactive and iterative process defining public sector role, technology choices and partnership options.

A telecom deregulation warning from Sen Simonson and Sen Johnson

The Post Bulletin posted a letter to the editor from Senators Erik Simonson and Sheldon Johnson

AT&T, Comcast, and the Minnesota Cable Communications Association are coming for your consumer rights as local phone customers.

Be afraid. Be very afraid — especially if you live in Greater Minnesota.

These companies are asking the Minnesota Legislature to completely deregulate local phone service if it’s provided by a new technology — Voice-over-Internet Protocol (or VoIP). They claim they shouldn’t have to follow any rules at all because they’re providing phone service using this more modern technology.

But don’t let them fool you. You don’t even need an Internet connection for calls to travel over VoIP technology. Basically, VoIP is just a method of getting calls from one place to another. To the consumer, the phone call is the same if it travels by VoIP, copper, fiber, carrier pigeon, or two tin cans and a string.

And if you’re a consumer, you couldn’t care less how the call gets to its destination, but you do care that calls to 911, your doctor, your families, your friends are reliably completed. You care if the company drags its feet on installing your new phone or if you have service problems and the company doesn’t fix them. You care if you go on vacation and perhaps the bill is late, you’ll still have a phone when you get home. And you care if you get bogus charges on your bill, you have recourse if the company refuses to refund them.

If AT&T, Comcast and the other cable companies get their way this year at the Legislature, all those basic protections will vanish in a heartbeat. Immediately, consumers whose telephone company sends your calls in whole or in part using VoIP technology will lose those protections.

It would be disastrous for consumers if this bill became law, especially for those who live in Greater Minnesota, where the local phone company is the only reliable provider they have.

First, under the bill there will no longer be a right to have phone service. It is expensive and unprofitable to serve rural customers and maintain infrastructure. Companies will invest their money in densely populated, more profitable urban areas and disinvest in maintenance of the network in rural, more expensive-to-serve, less profitable areas. Rural consumers will experience decreasing service quality and more outages as the system is allowed to deteriorate and resources are moved elsewhere.

Second, existing protections against charging exorbitant connection or reconnection charges would be gone. If the bill becomes law, phone companies can shut you off for no reason even if you always pay their bill on time or without notice if you are late. Companies can shut off customers simply because they are too expensive to serve and not sufficiently profitable. Who are these customers? They are older Minnesotans, people with disabilities, people on fixed incomes, and people who live in Greater Minnesota.

Third, AT&T and Comcast tell legislators that deregulation will produce more competition, lower prices, better service, more jobs, and broadband for everyone. Beware of would-be deregulated telecommunications companies bearing “gifts.”

Broadband is already deregulated – and there has been no investment. The Legislature has ponied up $50 million over the last two years (and more is proposed this session) to give to our cities to bring broadband to Greater Minnesota. If there was money to be made private sector money would be flowing.

Every part of their rationale is wrong. There isn’t a single legislator who represents rural Minnesota communities and citizens who should be supporting this bill.