Broadband Intro at Senate Committee on Jobs and Economic Growth Finance and Policy

Today I attended the Informational Hearing on Broadband at Senate Committee on Jobs and Economic Growth Finance and Policy. The Senators heard from a few people, including many from the rural frontlines about broadband in their community.

The speakers were in favor of continued support of the Office of Broadband Development and the Border to Border Broadband funds. They were hoping that the grants could be changed slightly to help cover a larger percentage of a project (u to 70 percent) because there are areas in the state where with even a 50 percent match, a provider would have a difficult time with return on investment.

A few speakers had issue with the challenge process and wanted to find ways to encourage funding from providers beyond the CAF/ACAM funding, which might only upgrade connections to 10 Mbps down and 1 up.

I livestreamed the meeting; the archive – minus one small hiccup – is posted below.

And following are my notes…

Danna MacKenzie – Office of Broadband Development

State involvement in Broadband

  • 2008 – first TF
  • 2009 – firs state broadband map created
  • 2010 – Statutory broadband goals established 10-20 Mbps down & 5-10 up
  • 2011 – New TF under new Governor
  • 2013 – Office of broadband created
  • 2014 – Border to Border grant created
  • 2015 – TF appointments renewed
  • 2015 – 2nd round of border to border grants appropriated
  • 2016 – speed goals renewed at 25/3

Office of Broadband Development tasks –

  • Tech assistance
  • Administer grants
  • Measure & map
  • Inform policy discussions
  • Clearinghouse for broadband info
  • Support digital inclusion
  • Support inclusion of community broadband need into local planning

Currently 209,000 households do not have access to 25/3 broadband

Q: Do you track advertised speeds vs actual speeds?
A: NO we don’t – we don’t have a concrete way to do that but we do get anecdotal info

Info on grant program:

Meant to fill a gap in an economic model that doesn’t work in very rural areas.

44 challenges – left to 6 projects that weren’t considered for grants.

Highlighting 4 projects worth watching for modeling potential:

  1. Sunrise Township and CenturyLink
  2. Kandiyohi – combining state and federal
  3. Lismore –
  4. Mille Lacs – electric cooperative

Q: If there’s an incumbent and someone else applies for funding – how long does a provider have to make good on a challenge?
A: It’s detailed in law. They have 18 months from award date to provide services at 25/3. Letter went out to challengers. We will track that – the consequences is that if they don’t honor the commitment, they can’t challenge through the next two grant periods.

Q: Can they apply for grants?
A: the law is silent.

Q: have the projects been on budget and on time?
A: Yes they seem to be. Grants are awarded on reimbursement basis and we haven’t seen any deviation.

Q: What is your confidence in meeting the 2026 goals?
A: If the state stays on track with current interest we are in line to reach those goals.

Q: Can you talk about scalable – esp in terms of equipment?
A: In the law, funds can only be used for technology that will scale to 100/100 Mbps. We are trying to avoid obsolete projects.

Margaret Anderson Kelliher – MHTA/ Minnesota Broadband Task Force  

About the Task Force – the history. There are 15 members representing wide range of interests. TF provides recommendations to the Governor.

The idea is to create an action plan for broadband in Minnesota.

Why is broadband so important? After all there are private providers?

Broadband allows for local business to compete globally.

Broadband allows households to save money and make money. From

53 million Americans freelance – $700 billion annually. 42% work online. They need broadband.

7 in 10 teachers assign homework that requires broadband at home

Many education organizations use broadband to provide virtual field trips and online curriculum.

Broadband and healthcare – Broadband allows people to live in their homes longer with access to healthcare and support.

  • The Task Force recommends $100 million for a biennium and we need an ongoing commitment.
  • The Task Force recommends base funding for the Office of Broadband Development
  • The Task Force recommends a cyber security commission
  • The Task Force recommends continued funding for libraries
  • The Task Force recommends Dig Once
  • The Task Force recommends encouraging embracing a computer donation program.

Q: TF recommends $100 million – how close is the state to making speed goals. How does $100 million help achieve those goals?
A: We changed the speed goal a year ago. We adopted 25/3 as base standard; it aligns with FCC goals. Then we have “stretch goal” for 10 years out. These are puzzle pieces we need to fit together.

We have private investment – but that will also go to most profitable areas. They make decisions based on ROI.

In the Task Force, we realized that the ROI doesn’t and won’t exist. There were market failures. So we decided to set up a fund. There is also CAF & ACAM money that goes into the state through regulated providers. For us to reach everyone – we need the State to help lower costs and improve ROI. If you can provide service to a home and connect it for $1500-2500 the ROI is doable. Where cost is $7000-13000 it’s hard to get ROI.

Bill Coleman – Community Technology Advisors

  1. To understand how important broadband is – read provider Facebook pages. Some are excited to get online – others are dismal.
  2. Public-private partnerships are essential to better broadband.
  3. We cannot solve broadband one community at a time – we need regional approach with higher support, lower timelines.
  4. We need infrastructure that will support rural areas for generations.
  5. Communities need broadband providers that are responsive to long term community needs not short term stakeholder ROI.

Tom Johnson – Nobles County

We got a Blandin Grant – that supported 11 broadband projects, including a feasibility study. Lismore and Frontier each asked for our feasibility study. Lismore applied for and got a Border to Border grant ($2.4 million). There was a challenge for Bigelow – so we had to remove that community from the project.

Marc Johnson – ECMECC & Co-chair for Kanabec County Broadband Initiative (KBI)

KBI recognizes the need for better broadband. We have worked on it since 2011. We have been supporting broadband adoption projects (via Blandin Foundation support). We have had countless meetings with incumbents and potential providers. We don’t have a provider partner with a strong enough drive to make a project work. IN Mora, the broadband service is fine. But most of population lives outside the city. CenturyLink services much of the area – they tell us there isn’t a business case, even with Border o Border funds. Providers are telling

CenturyLink has accepted CAF money – but it will be one step forward, one step back. It means we may only get 10/1 access. And it doesn’t introduce competition. And with minimal upgrades, it makes the area less attractive for an outside provider to consider our area. Our county is not alone.

Vince Robinson – business person Lincoln County

We have a 5-county regional effort to get better broadband. We are almost entirely unserved. 90+ percent of our area is not being served. Being rural and remote – it would be expensive to bring broadband to us. We are doing a feasibility study. We don’t want to leave people behind. A problem with CAF 2 money is that the provider can choose to upgrade only some areas – it leaves the least served still being the least served. We need more than 50 percent incentive to attract a provider partner. The costs to upgrade are increasing; we need funding too. We need to compete with South Dakota. I know people who have left Lincoln county because they could not get broadband. I know businesses that I have left Lincoln because of broadband. I know businesses that haven’t started. We are being held captive by CenturyLink and Frontier.

Joe Buttweiler – CTC

We need better than 50 percent support to reach the far ends of the digital divide. We suggest that the State grant cover up to 70 percent support for projects.

Q: What are drivers behind higher cost?
A: Population density

This entry was posted in Conferences, MN, Policy 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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