Broadband Bill in Senate (SF3049): Senators recommend $30 million more for broadband grants

Senators Draheim, Simonson, Westrom, Koran, and Utke introduce a broadband bill (SF3049) to the MN Senate. (A similar bill was introduced in the MN House earlier.)

S.F. No. 3049: A bill for an act relating to telecommunications; providing an annual statutory appropriation for the broadband development grant program; appropriating money; amending Minnesota Statutes 2018, section 116J.396, subdivision 3.

Here’s the full text:

A bill for an act
relating to telecommunications; providing an annual statutory appropriation for
the broadband development grant program; appropriating money; amending
Minnesota Statutes 2018, section 116J.396, subdivision 3.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

Minnesota Statutes 2018, section 116J.396, subdivision 3, is amended to read:

Subd. 3.

Transfer; appropriation; use.

$30,000,000 each fiscal year is transferred from
the general fund to the commissioner of employment and economic development for deposit
in the border-to-border broadband fund under subdivision 1. 
Money in the account is
appropriated to the commissioner for the purposes of specified in subdivision 2.

EFFECTIVE DATE; APPLICATION.

This section is effective July 1, 2020. The first
transfer under this section must be made in fiscal year 2021.

The Bill  was referred to Agriculture, Rural Development, and Housing Finance.

The power of state broadband grants to match fed is building networks for the future

Doug Dawson (Pots and Pans) is a smart guy. Yesterday he wrote about the FCC’s latest brand of rural broadband grants (RDOF) and a clause that seems to disqualify recipients that receive other state or federal funding. That means (and Doug points out below) that communities that have received MN Broadband grants would not qualify…

It’s important to remember that the RDOF grants are aimed at the most remote customers in the country – customers that, by definition, will require the largest investment per customer to bring broadband. This is due almost entirely due to the lower household densities in the RDOF grant areas. Costs can be driven up also by local conditions like rocky soil or rough terrain. Federal funding that provides enough money to build broadband in the plains states is likely not going to be enough to induce somebody to build in the remote parts of Appalachia where the RDOF grants are most needed.

State grant programs often also have other agendas. For example, the Border-to-Border grants in Minnesota won’t fund broadband projects that can’t achieve at least 100 Mbps download speeds. This was a deliberate decision so that government funding wouldn’t be wasted to build broadband infrastructure that will be too slow and obsolete soon after it’s constructed. By contrast, the FCC RDOF program is allowing applicants proposing speeds as slow as 25 Mbps. It’s not hard to argue that speed is already obsolete.

I know ISPs that were already hoping for a combination of federal and state grants to build rural infrastructure. If the FCC kills matching grants, then they will be killing the plans for such ISPs that wanted to use the grants to build fiber networks – a permanent broadband solution. Even with both state and federal grants, these ISPs were planning to take on a huge debt burden to make it work.

If the matching grants are killed, I have no doubt that the RDOF money will still be awarded to somebody. However, instead of going to a rural telco or electric coop that wants to build fiber, the grants will go to the big incumbent telephone companies to waste money by pretending to goose rural DSL up to 25 Mbps. Even worse, much of the funding might go to the satellite companies that offer nothing new and a product that people hate. I hate to engage in conspiracy theories, but one of the few justifications I can see for killing matching grants is to make it easier for the big incumbent telcos to win, and waste, another round of federal grant funding.

Minnesota has had great success encouraging larger providers to use their federal funding (CAF 2) to build to higher speeds in communities such as Sunrise Township. CenturyLink is the provider there. The community, federal and state grants have built a better network with CenturyLink.

The recipe of state and federal funds worked well in Sunrise and Fish Lake Townships. While on the other hand, both CenturyLink and Frontier have reported that they “may not have met” statewide benchmarks set up for their CAF 2 funding.

Maybe the FCC should check out the Minnesota model. It seems that having the state support, which in itself requires more local support, is an asset to making it happen and happen as Doug notes above – so that government funding wouldn’t be wasted to build broadband infrastructure that will be too slow and obsolete soon after it’s constructed.

Duluth appreciates economic boon to rural broadband

The Duluth News Tribune reports…

There was much fanfare in late January when Gov. Tim Walz rolled out $23 million in rural broad grants.

But what does that mean for businesses?

Access to high speed internet is paramount for rural small businesses, Business News Daily reports. Quicker internet may speed up production for some businesses.

The National Federation of Independent Businesses points out another factor that comes with increasing rural broadband: businesses’ investment in new cities.

Larger companies may select to invest in towns with higher internet speeds as it impacts their ability to translate large amounts of data, according to the NFIB.

MN Broadband grants in Houston MN (Houston County)

Winona Daily News reports…

Rural residents of Houston, Minnesota, will benefit from a $2.9 million grant awarded to AcenTek by the Border-to-Border grant program. …

The project, estimated to cost more than $9.6 million, is the largest (in square miles) of the areas the company provides service to.

AcenTek was awarded the grant for $2,895,318, which will cover 30% of the total cost of the project.

The project in rural Houston will positively impact residents at more than 900 locations (farms, residences and businesses).

Once the fiber build is complete, farmers will have more opportunities for using technology within agriculture, employees of area medical facilities will have options for telecommuting and students will have faster Internet speeds for research and study materials.

Broadband grants in Scandia – broadband team wins Good Neighbor Award (Washington County)

Country Messenger reports…

“Reliable access to broadband is essential and some underserved people in Scandia have been clamoring for it. This grant moves us closer to closing the digital divide in this community,” said Midco Sr. Director of Government Relations Justin Forde. “It was a highly competitive process, and we’re grateful to the state of Minnesota for supporting our vision of providing excellent services to underserved areas of the state.”

The City of Scandia also supplemented the grant with $160,085 and is planning to work with Midco on the expansion in the summer of 2020. With this expansion, residents will have faster, reliable Internet connection that will improve access to necessary health care resources, learning applications, and more. Midco is confident that the network extension will, “enable telecommuting options for residents and make businesses and city institutions more efficient.”

In an effort to bring reliable Internet services to underserved Minnesota communities, $23 million dollars in aid have been granted to 30 projects with Scandia being a recipient of $510,358 to extend their current services. In a show of appreciation, Scandia Mayor Christine Maefsky awarded the Scandia Internet Focus Group the Good Neighbor Award for their help in researching the lack of reliable Internet service in the community that helped in receiving this chance for network extension.

The $510,358 grant was awarded to Internet service provider, Midco, through the Border-to-Border Broadband Development Grant Program which will use that to extend their services to 219 households in five different areas of the Scandia community. The need for this expansion reflects the concerns of the Scandia Internet Focus Group in the fall of 2017 when they first assessed the lack of reliable coverage.

MN Broadband grants in Rosemount (Dakota County)

Hometown Source reports on the MN Broadband Grant awards…

The Office of Broadband Development announced that the Rosemount North Project in northwestern Rosemount has received $499,072 grant from the state’s Border-to-Border Broadband Development Grant Program.

This middle and last mile project will upgrade approximately 40 unserved and 225 underserved locations in northwestern Rosemount. In a funding partnership with the state of Minnesota and Dakota County, Charter Communications will improve broadband service levels up to 940 mbps download and 35 mbps upload, exceeding the 2022 and 2026 state speed goals.

MN Broadband Grants in Koochiching County and a nod to Rep Ecklund

The International Falls Journal reports…

Koochiching County will benefit from more than $23 million [actually the state will benefit from $23 million, benefits to Koochiching are listed below] in Border-to-Border Broadband Development Grant Program funds to 30 broadband projects across the state.

Projects receiving funding include $2.5 million toward Paul Bunyan Communications’ upgrades in Koochiching, Cass, Itasca, and St. Louis counties and on the Leech Lake Band of Ojibwe Reservation, and $1.2 million toward upgrades on the Bois Forte Reservation.

The article highlights local broadband proponent and International Falls legislator Rep Ecklund…

Rep. Rob Ecklund, DFL – International Falls, championed funding for the grants during the 2020 legislative session.

“There are numerous reasons for continued public investment in high-speed broadband. For our students, it’s unacceptable that many of them need travel to a coffee shop, restaurant, or library to connect to Wi-Fi just to do their homework,” Ecklund said. “My region and others in greater Minnesota also have a ton of potential for new economic opportunities, and I’m hopeful we can see current companies and emerging entrepreneurs prosper. By taking advantage of these opportunities, we can keep our rural communities thriving and vibrant.”