The Office of the Comptroller of Currency recently published the November issue of Community Development Investments. The theme is expanding broadband. They really get into the nitty gritty. I think it’s great reading for anyone who is thinking about financing options. So I’m going to include the annotated table of contents:
- Community Reinvestment Act Consideration for Rural Broadband Development Initiatives Banks financing certain broadband development initiatives can receive Community Reinvestment Act (CRA) consideration for promoting economic development in certain rural communities and helping to revitalize distressed and low- and moderate income communities across the nation.
- Closing the Digital Divide: How Banks Can Help Rural Communities With Broadband The National Telecommunications and Information Administration, part of the U.S. Department of Commerce, provides an overview of broadband technologies and explains how banks financing broadband initiatives can help reduce the digital divide in rural communities in need of reliable, high-speed internet access.
- Cooperative Connection: Banks Back RS Fiber to Bring Broadband to Rural Minnesota First National Bank of Fairfax, Minn., and other local banks are helping to finance a cooperative formed by 10 cities and 17 townships determined to provide quality, high-speed internet access in southwestern Minnesota. The case study serves as a working model for rural communities interested in establishing public-private cooperatives to deliver quality internet.
- Falcon National Bank: Financing Wireless First, Then Broadband in Rural Minnesota A community bank’s decision to finance Palmer Wireless began a successful partnership that turned into a decade-long relationship, benefiting the bank, Palmer Wireless, and the communities the bank serves by expanding an existing broadband network.
- U.S. Bank: NMTC Helps Expand Internet Access in Appalachian County in Ohio U.S. Bank used the national bank public welfare investment authority and helped to finance a new market tax credit project that expanded an existing broadband network for rural residents in Appalachian communities in northeastern Ohio.
- United Bank, Alabama: Wiring Branches, Several Business Customers With Broadband United Bank invested in a fiber-optic network solution to communicate more effectively between its rural branches using video conferencing and other online communication channels. This investment also benefited several local businesses that needed high-quality internet service.
- Wiring Alaska: Two National Banks Help Connect Remote Native Communities First National Bank Alaska and U.S. Bank made loans backed by federal loan guarantees to benefit Alaska’s Native communities by financing the expansion of fiber-optic networks in geographically remote areas that for too long had poor or no internet access.
The article on RS Fiber was of course of special interest to me. I won’t summarize the whole article, as the value is in the details, but here’s a taste…
The RS Fiber Cooperative (RS Fiber) is bringing low-cost and high-speed fiber-optic broadband to an area of southwestern Minnesota that includes 10 cities and 17 townships in Renville, Sibley, and portions of Nicollet and McLeod counties. Serving more than 6,000 households, businesses and farms, schools, public and private institutions, and hospitals with Fiber-to-the-Home (FTTH) connectivity, the cooperative serves an area of over 700 square miles at a development cost of $53 million.
RS Fiber’s success was made possible by a multilayered approach to financing involving banks; federal, state, and local governments; a community development financial institution; a private foundation; private equity investors; and member revenues. Playing a key role in the effort was First National Bank of Fairfax. The bank’s $50,000 investment helped finance initial engineering and predevelopment work. The bank’s capital was the catalyst for securing construction financing from other lenders. The bank made the investment using the public welfare investment (PWI) authority