More than a dozen people met in the Aitkin County Courthouse to talk about broadband with Senator Matt Schmit today. Four providers were in attendance (Mille Lacs Energy, Century Link, CTC & Frontier), a few politicians (Senator Schmit, Rep Sondra Erickson and Rep Joe Radinovich) and county economic developers. This was a follow up with communities who were brave enough to come out in the severe cold in January to discuss the need for broadband. It was an opportunity for folks to ask questions about the broadband fund. Senator Schmit made the point that funding will be made available, the priority is unserved areas and the competition is going to be stiff. So if you’re thinking about applying for funds, it would make sense to start the discussion now.

It was also a great opportunity for policymakers to ask questions of the providers. I was most interested in what they had to say. Someone asked the providers if the fund could help support existing business plans. Yes! They said. The providers have plans. They know how much it will cost to reach every home in their service area. I have not heard a provider say this in the past. I think it’s a good sign that the broadband fund may open the door to some frank discussions among policymakers, provider and community stakeholders about what really needs to happen to build border to order broadband.

Providers are interested in funding and plan to incorporate it into their normal business plan equations. It will help deploy faster to areas where the business case is otherwise difficult to make. The providers also mentioned that while the money is helpful, it’s not the only way government can help. As discussed in the video (and previously on the blog) providers would also appreciate a smoother path for processing and permits…

Senator Schmit is visiting a few towns this week. I hope to meet up with them again on Wednesday and will report in. It will be interesting to see if different communities have different questions.

 

(Read on for more detailed notes on the meeting.)

Questions

A big thanks to the House for pushing this through. It’s an economic game changer and will hopefully foster an environment for partnership. We need to break silos on the Capital and broadband is an opportunity to unite different silos. In 2009, we adopted speeds goals. This year we created the broadband fund.

Office of Broadband Development and DEED will be ironing out a process for the funds this summer. In the meantime, we invite communities to think about how broadband can help in the community – for education, or healthcare or for economic development. Providers can work with communities.

The $20 million is a great down payment on the larger amount that we need. We need good applications. People can prepare now.

Unserved versus underserved?

We wanted to ensure that public dollars would be targeted at areas of greatest need. The state law defines undeserved (10-20M down/5-10M up); the FCC definitions defines unserved (4M down/1M up). We want to prioritize the unserved. We also want all areas to meet state speeds goals. DEED has discretion to make decisions but the legislature wanted to make the point that we want to reach the hardest areas to reach.

Is this a wait and see?

If you fall short of the state speeds goals, you qualify for the grants. We just wanted to make sure that the funding got beyond regional centers to reach the outposts. A wide range of constituents signed off on the original speeds goals (businesses, providers, communities…) so we continued on with it. We need to be astute with the funding, so that we provide the point and are ins a good position to get future funding from the State.

We are technology neutral. It doesn’t have to be fiber. Tax money just needs to be spent on infrastructure that is scalable. It doesn’t need to scale immediately, but it needs to scale. We will gave DEED the flexibility to make decisions.

What’s the application process?

You need eligible applicants but that can be a business. The Legislature has been structure together but DEED will be finalizing the qualifications over the summer. We would like to see partnership get rewarded. It doesn’t have to be formal partnership but at least include some dialogs. We’d love to see a united vision among stakeholders. We want to see broadband community buy-in.

Is there a maximum?

All funds have to be at least a one-to-one match and grants cannot be larger than $5 million. Many folks are already looking at larger local match. The initial trial we want to reward 10-12 applicants who will really show folks what can be done with the money. We can’t have the money go to one applicant; we need to spread it around.

The FCC asked for projects ideas from rural areas. Minnesota had more than 50 communities offer proposals. When the Governor and legislators saw that response, that made a difference. Lots of communities are looking for improvements. To be competitive you need to start thinking now.

The nature of rural broadband is that the farther you get out the more expensive it gets. Getting provider participation is a plus for the proposals but what about the really far-reaching areas that don’t’ have willing providers?

The Task Force said it could cast $900 million to $3 billion to upgrade statewide infrastructure. We do want to reach the areas where economics don’t make sense. We hope that the economics would help the other areas. We are giving priority to the areas that are hardest to reach. We want to make sure that they are successful too. It’s a challenge.

What are the funding priorities?

There were about 10 criteria in the bill.

From the providers:

It’s cheaper to expand existing networks rather than build a new.

We now have several providers in some areas. The challenge is how to administer the grants so that it benefits the communities and doesn’t disadvantage provide business. Maybe we can get providers to work together in a community.

It does come down to a cost/benefit analysis. We ran into this when we created solutions for public safety and we ended up needing to upgrade. I know satellite is going to be a major player.

People looking to relocate are asking about local access to broadband.

What about technology?

Wireless runs into data caps. Fiber is nearly future-proof. Satellite

Is there a deadline for applying?

DEED is working out the details. We are looking at awarding early 2015 and are cognizant of winter-restrictions for building broadband in Minnesota.

Does improvement work when 5/10 Mbps isn’t logical?

We don’t want perfect to be the enemy of the good. We have the flexibility so long as the network is scalable. SO this might open the door to wireless solutions or fiber to the node options – options that build toward improvement

The flexibility might allow for network extensions beyond where extension would meet the speeds goals and/or might create an opportunity for local match investment.

Any stipulations such as open infrastructure?

DEED has an opportunity to make adjustments. Open infrastructure would be interesting to consider but it does seem like providers may back up from that option. The number one goal is how do we reach state speed goals. DEEED would also like to see some return on investment – which makes it easier to make future investment

Not everyone will get funded but the conversation can continue.

Question for providers…

Aitkin County is served for several providers . We have unserved areas. DO you have projects on the drawing board that could be shovel-ready for the grant? Does a 50 percent match help you come to us with a project? We’d like to work with you. We can get the community behind any project.

Providers say yes. We have a plan for every corner of the exchange. We know how much it would cost to reach them. We know the possible support (CAF, MN Broadband Fund). A plan exists. When we have 1.5 access – that means we need to build fiber. We need the fiber backbone.

Where is the bang for the buck?

We need a level of density.

We have a road plan would an extra couple feet of right of way be helpful to you?

Yes it would. We always try to partner with anyone building trenches. We can spend millions on BAU (road moves). The money gets spent but it doesn’t provide any benefit.

We need to talk. Communication and coordination.