The agony of rural broadband, the thrill of making it happen

This week City Pages has a nice feature on rural broadband. A good wake up for those of us in the Cities who aren’t living on the frontlines of slow Internet. They do a good job telling the stories…

Outside nearby Gibbon, Linda Kramer endured a similar fix. Her family grows corn, soybeans, and wheat, while her husband also works as a crop consultant. He’d attempt to send field data to clients, only to watch it take days to upload. So he’d find himself driving 40 miles just to deliver thumb drives.

“We weren’t being able to accomplish what people in the cities or other rural areas were able to accomplish,” Kramer says.

Their problems weren’t unique. Across hulking swaths of Minnesota, gas stations struggle to run credit cards. Counties see scant hope of nursing new businesses. And everyone worries the evacuation of their young will only accelerate. Forgive college grads who can’t see futures in places where it takes hours to load an Instagram photo.

They highlight a solution that is working in Renville and Sibley Counties…

Winthrop—population 1,399—was too small to build a high-speed fiber system on its own. So it resorted to a spirit of socialism practiced a century ago, the kind that brought electricity, phone lines, and farm cooperatives to the Minnesota backcountry.

It would seem a despairing quest. Sibley County is in the heart of Trumpland. “Out here, we’re quite conservative,” says Erickson. “When the Republican Party says something, people listen.”

Yet the resulting campaign would exhibit a savvy and insistence few lefty activists could match. It involved 10 cities and 17 townships across Renville and Sibley counties. Over 100 educational meetings spanning two years. Seventy volunteers to carry the load.

The final outcome: RS Fiber, a co-op that delivers better internet than most Twin Citians receive.

And the difference fast broadband has made…

For Jacob Rieke, it means no longer fearing for his daughters’ schooling. He can now employ all the weaponry of precision farming, saving between $5,000 and $20,000 annually on seed costs alone.

For Linda Kramer, it means getting 10 times the speed of her old service for the same price, allowing her family to be “good stewards of the land.” An ability to read the subtleties of a field prevents over-fertilizing, which has left most southwest Minnesota waterways too toxic for swimming. “The technology is really allowing people to do good things.”

RS is also fostering commerce. A new 3D printer business in Gibbon can send data-heavy files to clients. An industrial electrician in Winthrop does work all over the world.

They talk about Windomnet too, another innovative approach to service in rural areas…

Fortune’s success comes courtesy of Windomnet, among the nation’s first city-owned internet concerns. The company’s databases handle orders 24/7, a task impossible in much of outstate, since time-outs and dropped connections corrupt files, turning orders into horrors.

And Paul Bunyan…

The same thing could be said of Bemidji, home to Paul Bunyan Communications. It began as a telephone co-op in the 1950s, eventually moving on to TV and internet across multiple counties. “They’re really transforming that entire region,” says Coleman. “It’s becoming a high-technology center.”

And Lake Connections…

Lake County rode to the rescue. It created Lake Connections, with the unforgiving task of bringing broadband to 11,000 residents scattered across 2,100 square miles, an enterprise no private company would attempt.

 

$43.7 Million in USDA Smart Grid Funding, Could Help Drive More Rural Broadband: 3 projects in MN

Telecompetitor reports…

The U.S. Department of Agriculture awarded $43.7 million in funding for rural smart grid projects. The USDA smart grid funding was part of a broader announcement of a total of $398.5 million to improve rural electric service in 13 states. The funding came in the form of low-interest loans.

The USDA smart grid funding could be good news for rural broadband providers, as smart grid projects rely on advanced communications infrastructure and rather than build that infrastructure themselves, some electric companies partner with broadband providers for that purpose. In some cases, this can help build a business case for fiber deployment to support broadband services in areas where it previously was not economically feasible.

At least one rural electric company in the latest group of funding recipients has partnered previously with a small rural broadband provider.  Mille Lacs Energy Cooperative partnered with Consolidated Telephone Company on a previous buildout.

The need to deploy communications infrastructure to support the smart grid also is spurring some rural electric cooperatives to become broadband service providers themselves.

They list the award recipients; here are the three from MN:

  • Mille Lacs Energy Cooperative (MN)
  • Red River Valley Cooperative Power Association (MN)
  • Federated Rural Electric Association (MN)

And more info on the MN projects

Mille Lacs Energy Cooperative received $15,000,000 loan.
This Rural Development investment will add 575 consumers, build 42 miles of line, improve 38 miles and make other system improvements. The loan amount includes $2,961,860 for smart grid projects.  Mille Lacs Energy is headquartered in Aitkin. It serves about 15,150 consumers in Aitkin, Crow Wing and Mille Lacs counties.  The economy of the territory is principally based on tourism, recreational activities and light industry.

 

Red River Valley Cooperative Power Association received $8,000,000 loan.
This Rural Development investment will add 414 consumers, build 47 miles of line, improve 44 miles and make other system improvements.  The loan amount includes $1,545,000 for smart grid projects.  Red River Valley is headquartered in Halstad.  It serves 4,606 customers over 1,802 miles of line in Clay, Norman and Polk counties in northwestern Minnesota. The economy of the service area is primarily agricultural.

 

Federated Rural Electric Association received $4,500,000 loan.
This Rural Development investment will add 100 consumers, build 19 miles of line, improve 32 miles and make other system improvements. The loan amount includes $1,798,500 for smart grid projects.  Federated is headquartered in Jackson. It provides electric service to 6,789 consumers in seven counties in southern Minnesota and four counties in northwestern Iowa.  The service territory is primarily agricultural.

 

USDA to Implement Regulatory Reforms to Increase Access to Capital in Rural Areas

News on funding from the USDA. They are holding a few listening sessions and many are available online…

WASHINGTON, Sept. 5, 2018 – Assistant to the Secretary for Rural Development Anne Hazlett today announced that USDA is hosting listening sessions to solicit feedback on a plan to increase access to capital in rural areas by streamlining regulations for four Rural Development loan guarantee programs.

“At USDA, we know that for many rural communities the regulations that govern our programs can be outdated and difficult to navigate,” Hazlett said. “Under the leadership of Agriculture Secretary Perdue, USDA is committed to simplifying our regulations and streamlining our program resources so we can be a better partner to rural leaders in building prosperity.”

The changes will simplify the application process for four Rural Development loan guarantee programs that provide funding to start, improve and expand businesses and build critical infrastructure. They also will incorporate modern lending practices, accelerate the loan approval processes and increase the amount of capital available in rural communities. The programs are the Community Facilities Guaranteed Loan Program, the Water and Waste Disposal Guaranteed Loan Program, the Business and Industry Loan Guarantee Program and the Rural Energy for America Program.

The Rural Development Innovation Center is hosting listening sessions this month to solicit comments on the reforms.

Listening sessions will be held:

  • Sept. 10 in Denver from 9:30 a.m. to 12:30 p.m. MDT at the Denver Federal Center. To attend virtually, visit:  Attend virtually.
  • Sept. 10 in Lexington, Ky., from 1:00 p.m. to 4:00 p.m. EDT at the USDA Rural Development State Office. To attend virtually, visit: Attend virtually.
  • Sept. 12 in Lake Ozark, Mo., from 1:30 p.m. to 4:30 p.m. CDT at the Lodge of Four Seasons. To attend virtually, visit: Attend virtually.
  • Sept. 14 in East Stroudsburg, Pa., from 9:30 a.m. to 12:30 p.m. EDT at East Stroudsburg University. To attend virtually, visit: Attend virtually.
  • Sept. 19 (virtually only, focus on Tribal areas) from 3:00 p.m. to 4:30 p.m. EDT. To attend, visit: Attend virtually.
  • Sept. 20 in Washington, D.C., from 9:30 a.m. to 12:30 p.m. EDT at USDA Whitten Building, Room 107-A. To attend virtually, visit: Attend virtually.

Red River Communications speaks up for rural communities with good broadband

The Wahpeton Daily News recently posted a letter to the editor from Red River Communications as a reaction to someone assuming that all rural areas are bereft of good broadband. The letter details Red River’s network…

Reliable access to high-speed, broadband Internet is no doubt a huge driver for economic development and quality of life. It’s why we are continually reinvesting in the network we’ve built. In 2017, we completed a 12-year project that provided fiber-to-the-home to over 1,500 square miles of southeast North Dakota and west central Minnesota. Our efforts have been recognized regionally and on the national stage by US Senators and Representatives, the FCC, industry groups, and our peers.

The communities we serve in Richland County were awarded the status of “Smart Rural Communities” by NTCA – The Rural Broadband Association. Our entire fiber network earned Red River Communications the designation of being a “Gig Capable Certified Provider,” meaning every single one of our members on our fiber network in Richland and Wilkin counties can receive true gigabit Internet speeds.

The network we’ve built with other small communications providers across North Dakota and Minnesota is literally the envy of the nation in terms of connectivity and the speeds offered. The Internet speeds often far exceed what is available in major metropolitan areas. US News recently ranked North Dakota number 2 overall in the nation for Internet connectivity. Minnesota was ranked number 7.

And the problem with assuming the worst…

To suggest without inquiring with the local providers that many area residents don’t have access to quality high-speed Internet is misleading and damaging to economic development prospects in the Southern Valley. While it is true that there are areas of the country that lack adequate broadband access, that is simply not the case here. It appears local economic development leaders are buying into the narrative of national advocacy groups like Connect Americans Now without truly understanding the tremendous broadband opportunities in their own backyard.

What message does it send to business leaders, investors, and developers when they see local economic leaders bemoaning a perceived lack of Internet connectivity? We need to promote the advantages we have in our area and not highlight shortcomings that don’t exist.

Update on RS Fiber Financial Situation – shortfall notification

The Arlington Enterprise reports…

The RS Fiber Cooperative is facing a projected financial shortfall. Based on information recently provided by the RS Fiber Cooperative, a shortfall is projected within the next two years which will impact loan payments for the 2015 A General Obligation Tax Abatement Bonds issued to fund an economic development loan to the RS Fiber Cooperative.

“Our duty is to report the estimated shortfall for the next two years so that member cities can implement tax levies to fulfill their obligation to replenish any shortfalls in debt service payments,” Shannon Sweeney of David Drown Associates, Inc., said in a letter to the nine cities.

Here are the numbers…

The projected shortfall will be $298,964.25 on Feb. 1, 2019; $156,066.25 on Aug. 1, 2019; $446,066.25 on Feb. 1, 2020; and $152,542.75 on Aug. 1, 2020. Overall, the projected two year shortfall will total $1,073,639.50. The member cities include Green Isle, Gaylord, New Auburn, Fairfax, Gibbon, Winthrop, Lafayette, Stewart and Brownton.

Green Isle has already discussed the issue…

The Green Isle City Council discussed the projected financial shortfall at its regular meeting on Tuesday night, Aug. 14. Green Isle will be asked to replenish $18,356.40 on Feb. 1, 2019; $9,582.47 on Aug. 1, 2019; $27,388.47 on Feb. 1, 2020; and $9,366.12 on Aug. 1, 2020. The total will be $64,693.46. The consensus of the Green Isle City Council is that the RS Fiber Cooperative needs to be much more transparent with the member cities.

BroadbandUSA Webinar, Nov 15: Electric Co-ops bringing Fiber to Rural America

Another good webinar coming up…

BroadbandUSA Practical Broadband Conversations Webinar Series

Topic: Practical Broadband Conversations: Electric Co-ops Bringing Fiber to Rural America

 

Date: Wednesday, November 15 from 2:00-3:00 p.m. EDT

 

Overview: Electric cooperatives are capitalizing on existing infrastructure and deep community roots to bring gigabit communications to rural communities, and the results can be transformational. Just as rural electrification energized the country in the early 20th century, high capacity broadband connections are necessary for thriving communities in the 21st century. Join BroadbandUSA’s Practical Broadband Conversations webinar to learn how member-based co-ops are making the case for investment and creating new opportunities for economic prosperity.

 

Speakers:

Brett Kilbourne, Vice President Policy and General Counsel, Utilities Technology Council

Randy Klindt, Founder, Conexon; General Manager, OzarksGo

Paul Belk, President, North Georgia Network

 

Please pre-register for the webinar. After registering, you will receive a confirmation email with instructions on joining the webinar.

Case study of Cook County MN – building a case, building partnerships, building broadband

CoBank recently published a helpful (and inspiring!) report on Making the Move to Broadband: Rural Electric Co-ops Detail Their Experience. The whole report is worth a read if you’re looking at tackling rural broadband and even you’re not an electric cooperative. One of the communities they highlight is Cook County and old ARRA project deployed by Arrowhead Electric Cooperative.

A little bit of background on the project. IN 2009, Cook County was listed as least served counties in Minnesota; last I looked they had 94 percent coverage for speeds of 25/3 and 100/20. ARRA Funding is the impetus for the jump. (Although they were also part of Blandin’s MIRC program, which certainly helped boost use of the network.)

The case study is in the form of an interview – Jenny Kartes from Arrowhead talking to Mark Doyle from CoBank. I am just going to pull out the section (pg 43-44) that I think will have the most value for the greatest number of reader – so folks with and without a relationship to a cooperative – although I have to say the ethos for the cooperative certainly seems like a good fit for getting rural broadband done…

MD: Did you partner with anyone?

JK: We did. At the beginning of our project, we had a number of options as to how we were going to do this. Were we going to be the retail provider or the wholesale provider? We found quickly that there is a large learning curve especially related to phone and the assets you need for providing phone service. We wanted a partner with our same values and good industry knowledge. We found Consolidated Telecommunications Company (CTC) out of Brainerd, Minnesota, which as a cooperative really had our same values and has been doing this for a very long time. They were a good fit for us, and they were very excited to work with us as well. It was a good partnership as a small entity. There was a lot more on the front end than we had originally realized. We did indeed need that partnership and rely heavily on it.

MD: How are you funding the project?

JK: We funded this project through the American Recovery and Reinvestment Act, the broadband initiative program. It was funded through a $16.1 million federal grant and loan: $11.3 million in grant and $4.8 million in federal loan. After our application, we realized that due to our terrain and the seasonality of our customers, it was going to cost a bit more than that. We then went to our county, and they

provided $4 million more in grant funds to us. It was a $20 million project in total, roughly 75 percent grant funded.

MD: Did you collect contributions in aid to construction from your subscribers?

JK: On the initial rollout of our project we did not. We had a window of a few years, as we were rolling out our construction, when we allowed people to essentially sign up for free construction to the home. It did not require them to take service. Once that window closed, and if you did not sign up within that window, then we do require 100 percent aid to construction from the subscriber. Since our subscribers are not necessarily members of our cooperative, we do require them to fund that construction.

MD: Was the project on time and on budget?

JK: Based on our original projections, it was not. As I mentioned earlier, our original budget was significantly short and we required an additional $4 million to complete the project. We then reworked our budget a few times, and we did stay very close to our second budget that included the additional $4 million.

 

However, that did create a timing issue as far as securing the additional funds to complete the project. The project was initially to be done at the end of 2013, and we finalized the project in 2015. Construction delays were mainly due to the terrain. We have a lot of rock, and construction is slow going in our service area. Additionally, the very short construction season in northern Minnesota

slowed us down.

MD: Did you encounter any surprises or challenges along the way?

JK: Yes. I could talk for quite a while on that. Having detailed maps and accurate plant records would have saved us a lot of frustration and a lot of time as the project began. We also did not realize the importance of on-site engineering, on-site contractor management and constant quality assurance throughout the project, at every point. We ended the project with those elements in place. We also ended up changing some of our contractors/vendors mid-project. Many of our contract crews were a bit surprised by our service territory and the time it took to complete work, never doing work up here before.

MD: What is your long-term measurement for the success of this project?

JK: The long-term measurement for success, being that our goal was to just get our community connected, is that the broadband project and division can be financially self-sustaining. We do not want the project to have any risk for our electric members. We’re not looking to make large profits off of it. If it can stand on its own financially, and provide good customer service and good broadband service to our community, we will call it a success.