Sunrise Township moves forward to petition for Subordinate service district bond

Last night I attended the township meeting in Sunrise Township to discuss the next steps for their better broadband plan. Spoiler alert – the residents are going to work on a petition to get 50 percent of the 532 households in CenturyLink territory to say they are interested in bonding for $500,000. That money along with CenturyLink using CAF 2 funding will be used as match for a Minnesota Border to Border grant application.

They are interested in using a subordinate service district bond, which means only the houses that qualify for the service will play back the bond. The payback will be around $100/year for each household.

The town board agreed to continue with the grant application.

CenturyLink says they are excited to work on the project. If the funding doesn’t come through they still will use CAF 2 funds in the area to do fiber to the node – but with fiber to the node they will also coil fiber at intervals (650 ft) to streamline a FTTH upgrade in the future or to allow someone to upgrade themselves – although the cost of the individual upgrade will be on the customer. (That seems like a step to scalability to me. Although there wasn’t a promise of that next step without grant funding.)

Good news – the partnership seems strong, the local residents are invested (there were at least 50 people at the meeting, not bad for community of 532 homes) and they are willing to work to demonstrate public interest in the project. Also – with CenturyLink as a partner, it seems they will fly by the challenge process.

Bad news – CenturyLink doesn’t serve the whole township; Frontier is the other local provider they apparently did not respond to invitations to discuss such a partnership.

Lessons – The subordinate service district bond seems like a good way to have only households that experience the upgrade pay back the loan. The petition cannot be internet-based.

Read on or watch the videos for more info…

We cannot tax the whole of sunrise to get service for CL customers only. We can use a Subordinate service district bond – where the town provides services to part of a town and pays it back with revenue generated from the project.

What needs to happen to move forward:

  • A petition (not internet-based) by at least 50 percent of the property owners.
  • There are 532 households in the area served by CL
  • Public hearing by 30 days
  • Board approval within 30 days
  • Notice within 20 days of resolution – where if 25% want to put this to a vote, you put it to a vote
  • It begins 60 days after resolution to be accessible

The board is not against this. BUT it’s a federal offense to put something in a mailbox. So they don’t appreciate folks putting letter in the mailbox of local residents. People have called about these things going into the mailbox.

The board needs the petition to go through the process.

There were arguments about why a letter didn’t go out after the July meeting to inform the 532 households.

The board says they would hold an informational meeting but they didn’t have information. Some argument about whether the

Info from CenturyLink

CL has committed to put in fiber line into the park to serve 230 households. (Some debate on number of houses.)

Sunrise qualifies for CAF 2 funding

We planned to upgrade in 2017 – at least 10/1 service

They will put fiber to the nodes and nodes in the community – making copper faster

We said we’d move it to 2016 after being approached by Nancy and others.

If you’re close to the node – you’ll get good service (60-80Mb). Every 600 ft we’re putting in coiled fiber so that we can build out at some day in the future even if we don’t get OBD funding.

IN 2017 (after second deployment) every resident should get 10/1 service.

We modeled our numbers off past FTTH deployment. With CAF that brings fiber closer to Sunrise. We were looking at $1+ million before assessing CAF impact. Now we just need $500,000.

Regardless of bond CL will do this:

  • Fiber to the node – two nodes in Sunrise: one in 2016 and one in 2017. If you are close to the node, you will l have good speeds. If you are farther out, you won’t. We can invest

With bond CL will do this:

  • FTTH

How will funding work:

  • CL puts in Fiber to node with CAF 2 dollars
  • We ask for OBD funding
  • We ask Sunrise for local match (match will also look to OBD)

We may be talking to other communities about CAF 2 – but because Sunrise is willing to match funds it is the project we’re spending time on.

What does “up to”? We’ve been burned by satellite.

Voice from Frontier –  So we’ll get nothing. (In fact 4 young gentlemen stormed out.)

Back to CL:

What does a VoIP call take?

50K – but it’s the latency that matters not the speed.

FTTH – up to a gig.

We have a 5 gig access at home – the real problem there is the hosting of the websites you’re visiting.

Fiber to the node – is up to 10/1

Who would apply for the OBD grant?

Sunrise

How much are we seeking?

We’re asking for $1,038,000 – less than 50%

CL would pay 55% of remaining budget; Sunrise will pay 45%.

Grant would be contingent on successful bond, which means more than 50 percent of impacted households agree it’s OK.

Why can’t the town help with the petition?

We’ve been told that we can’t do this work. We couldn’t pull together the numbers in time to get a letter out.

We are frustrated that residents weren’t informed.

In July we knew about the October deadline. Why wasn’t this more urgent? Funds will go to communities that

Is there a way we can have contact info for the people we need to sign petitions? Yes.

BUT you need to know that everyone in the CL area will be taxed for this project.

We judge households by 911 access.

CL is shovel ready.

If you get the signatures we can hold a special meeting.

OK we’ll go door-to-door.

There is a law firm that can help with this. They have the format down. Ehlers can start to work with the lawyers to get it going.

We need a point of contact to coordinate the effort. OK let’s do it!

What’s the deadline?

Grant is Oct 3.

Need to establish subordinate district support. That’s separate from the grant.

The board can put the petition online for folks to download. Just like they announce public meetings.

What is the household payout?

We’re working with a bond attorney. This is a little bit different than

Can do a tax exempt bond, which will lower cost. Need to look at rates. But know that is is a historic low rate. (Kind of like mortgage rates.)

15 yr bond – $150,00 house will be $53/annually – $250,000 will be $100/annually

10 yr bond – $150,00 house will be $72/annually- $250,000 will be $135/annually

OR not considering value of house

15 yr bond – $1100 or $97/year

10 yr bond – $133 year

CL prices –

  • Gig is $179/moth
  • 40Mb is most popular is lowest tier you can get with FTTH product for $30-ish
  • Pricing will be same as in metro areas.

No matter what we’ll be getting 10/1 access to everyone (in CL area)

Doesn’t the quick turnaround on the petition for bonding help the grant proposal?

It might so will the movement forward.

IN CL – we don’t have any other municipality in our area that is doing this.

So the petition goes through. You’ll call a special meeting – can the info be sent out at that time?

Having meetings that communicate is valuable. The board will decide whether the pay back is dependent on house value or a straight rate.

Doesn’t the quick turnaround on the petition for bonding help the grant proposal?

It might so will the movement forward.

If this doesn’t get done now. CL will have fiber coils ready to deploy – but the customer will pay for drop and install. (There is no charge for drop less than 750 feet.)

Only Sunrise will get FTTH. But we will not have fiber that goes outside Sunrise. We say that we not serve areas outside Sunrise since Sunrise is helping to pay for the deployment.

Will new copper go in with Plan B? No. (Not confirmed, not mentioned by CL.)

Thank you for moving forward to this. I moved here a year ago. We hoped we might get better broadband someday. I need it for my business. Just last week I realized it was faster to drive a disk to a client in Minneapolis that upload it from here.

Motion to apply for OBD funds – unanimous vote.

 

 

This entry was posted in Community Networks, Conferences, MN by Ann Treacy. Bookmark the permalink.

About Ann Treacy

I have a Master’s Degree in Library and Information Science. I have been interested or involved in providing access to information through the Internet since 1994, when I worked for Minnesota’s first Internet service provider. I am pleased to be a part of the Blandin on Broadband Team. I also work with MN Coalition on Government Information, Minnesota Rural Partners, and the American Society for Information Science and Technology.

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