Five steps to help rural communities decide federal broadband subsidies

Jonathan Chambers outlines an interesting proposal in the Daily Yonder – “to move the decisions about rural investment from Washington policymakers to individual rural Americans.”

Here are his 5 steps (abridged):

  1. Use the FCC’s data to identify all areas unserved by broadband. Census blocks would be considered unserved if they lack broadband as defined by the FCC. Broadband is defined today as an evolving standard consisting of four attributes: speed (currently 25/3 Mbps), capacity (150 GB per month of data or the median household usage), latency (100 milliseconds) and price (median national price).
  2. Use the FCC’s Connect America cost model to determine the appropriate level of public funding for each location in each census block.
  3. Make available such support to all internet service providers (ISPs) that are certified in states as eligible telecommunications carriers (ETC). The count of each ETC’s subscribers should only include broadband service and should be limited to one subsidy per location, similar to the limitation of the Lifeline program of one subsidy per household.
  4. Every six months, when ISPs submit data to the FCC indicating geographic area, speed, technology and numbers of customers, each eligible telecommunications carrier that wishes to participate in the Connect America Fund would submit their data to the Universal Service Administrative Company. The fund administrator would compensate each carrier based upon the number of locations served with broadband and the subsidy per location per census block. The FCC would also continually update its information on where services were provided without the use of a subsidy in order to eliminate those areas from further public funding.
  5. Any ISP could win back a customer it loses, and thereby win back the subsidy amount.

There are two things I really like about these steps. First the data requirements!  It opens a door to wireless solutions that are affordable. And when/if wireless options are affordable it will create much needed competition in rural areas. If I had a magic wand, I might include consumer protections around contracts – don’t require/expect multi-year contracts.

Next – I like the idea that any ISP could win back a customer. Competition motivates. Handing off rural consumers from one provider to another without incentive for improving services leaves service to the discretion of the provider and as Chambers points out that doesn’t work everywhere. (Some providers are great! Some are not motivated – hopefully this will help.) Knowing that with a customer comes government support increases the consumer protection.

State funding and coordination can only help Minnesota make the most of any federal funding opportunities. State funding provides match (when needed/desired), which makes it easier for companies to invest here. State coordination helps providers work together, work with communities and leverage broader resources. With state coordination, we’re like the kids who study for the test – we’re prepared and we do better.

Mesabi News reports on MN State Broadband funding issues

Mesabi Daily News reports on how budget talks were going at the Capitol…

Broadband funding varies in the three budget proposals on the table.

Dayton suggests spending $60 million, the Senate $20 million and the House slightly more than $7 million.

Miller indicated that he wants to spend more than his bill’s $20 million. “Hopefully, we will be able to find more resources.”

Communities with little money and little broadband connectivity would especially benefit from Miller’s bill, he said. It lowers local contributions the state requires from the existing 50 percent to 35 percent.

The $20 million in Miller’s bill would provide broadband to 8,000 more Minnesotans.

MN House Job Growth Budget – $7 million for broadband grants for one year only

Earlier today I posted the Senate budget for broadband ($10 million a year for 2 years). Now I have the House Job Growth and Energy Affordability Policy and Finance Committee posted proposed budget today.

Here’s what they have for broadband: Broadband (HF1618 Baker/HF841 Sandstede) (Border to Border Grants)

  • FY 2018 – $7 million
  • FY 2019 – 0
  • FY 2020 – 0
  • 2021– 0

They budget $250,000/year for the Office of Broadband Development from 2018-2021.

Both the Senate and the House are far from the $50 million a year proposed by the MN Broadband Task Force and the $30 million a year proposed by the Governor.

MN Senate Jobs Omnibus Budget Spreadsheet – Broadband Grant funding through FY 2018-19

I try to follow what’s going on at the State in terms of funding for broadband. Yesterday I ran across the Senate Jobs Omnibus Budget Spreadsheet. There are a couple of interesting items related to broadband.

  • The Governor’s proposed appropriation for Border to Border grant for 2018-19 is $60 Million ($30 million per year) with $500,000 ($250,000 per year) for the Office of Broadband Development
  • The Senate’s proposed appropriation for Border to Border grant for 2018-19 is $20 Million ($10 million per year) with $500,000 ($250,000 per year) for the Office of Broadband Development
  • Neither have proposed funding for the grants for FY2 20-21
  • Both have proposed funding of $500,000) ($250,000 per year) for the Office of Broadband Development for 2020-21

Kandiyohi County & CTC get started on their Border to Border project

The West Central Tribune reports on a fantastic way to start a Border to Border Project…

A series of “meet and greets” will be held over the next three weeks for residents and businesses within the proposed service zone of a broadband project by Consolidated Telecommunications Co.

The meetings are scheduled for this coming Monday; Thursday, March 23; and April 4. All three will be held from 5 to 6:30 p.m. at the Dethlefs Senior Center in Spicer.

The sessions will be an opportunity for residents to meet representatives of Consolidated Telecommunications Co., ask questions and sign up for future broadband services.

Those who aren’t sure whether their home or business is within the proposed project area may go to the company’s website at www.connectctc.comand enter their street address and zip code.

Kandiyohi County residents who live or own a business outside the project zone are also encouraged to attend. Their input will help Consolidated Telecommunications gauge local interest in future broadband expansion projects.

So smart to get the community involved at the onset. AND I want to highlight the door that has opened because of the grant. They are inviting others to come to help decide where to go next.

Grants for library white space projects – deadline March 27

It would be great to see some funding come into Minnesota…

“Beyond the Walls” Deadline EXTENDED!
Apply before March 27, 2017
$15,0000 subgrant awards to fund five community TV WhiteSpace projects.
Tens of millions of people in the U.S. rely solely or in part on public libraries to access Internet. Libraries are crucial in connecting communities. With TV WhiteSpace technology people can connect beyond library walls. The “Beyond The Walls” Awards will provide five $15,000 grants to libraries for the most innovative proposals to use TV WhiteSpace (TVWS) technologies to enable new library hotspots in the service of their communities.

Thank you to those who have already submitted proposals. There have been some very strong proposals already, but the door remains open for two more weeks! Spread the word about this opportunity and apply today.

Apply now!

Kandiyohi County to sell bonds next month to finance broadband project

According to the West Central Tribune

Tax abatement bonds will be issued this spring to finance Kandiyohi County’s matching share of a $10 million private-sector project to bring broadband to some of the rural neighborhoods that need it most.

The County Board of Commissioners set the process in motion Tuesday with the adoption of a pair of resolutions. The first resolution sets a tax abatement hearing for 10:15 a.m. April 4. The second clears the way for the sale of $5 million in bonds.

The amount is the local match for a $4.9 million grant awarded earlier this year by the Minnesota Office of Broadband Development to Consolidated Telecommunications Company.

It’s the county’s first foray into the realm of tax abatement bonds, said Larry Kleindl, county administrator.

The article goes on to explain the tax abatement bonds…

Proceeds from the bonds will be loaned to Consolidated Telecommunications Company for the broadband project.

The debt service for the bonds will be paid from tax abatement revenues and property taxes which will be reduced or cancelled by the loan payments from Consolidated Telecommunications Company, explained Shelly Eldridge, senior municipal adviser with Ehlers.

“We believe that this is the most cost-effective way to finance this project,” she told the County Commissioners.

A fact sheet on Ehlers web site further explains that tax abatement, in practice, is a reallocation of taxes. All taxes are still paid in full, but the abated amount is redirected to a specific project rather than going to the general fund. Bonds may be issued to finance the project and repaid with proceeds of the abatement.

I think it’s helpful for other communities to see how it’s getting done. The Border to Border grants are a huge boost to rural broadband in Minnesota – but it’s only a piece of the puzzle. Generally the community and the provider hold a piece too.