FCC authorizes $524 million for broadband CAF Auction ($3.5 million in MN)

The FCC reports

The FCC today authorized over $524 million in funding over the next decade to expand broadband to 205,520 unserved rural homes and businesses in 23 states, representing the third wave of support from last year’s successful Connect America Fund Phase II auction. Providers will begin receiving funding this month.
In total, the auction last fall allocated $1.488 billion in support to expand broadband to more than 700,000 unserved rural homes and small businesses over the next 10 years. The FCC has already authorized two waves of funding in May and June, and funds from those first two waves are expanding connectivity to nearly 100,000 homes and businesses that lack service. Today’s action brings total authorized funding to nearly $803 million, or over half of the $1.488 billion allocated through the auction, expanding connectivity to 305,518 homes and businesses.

In the coming months, the FCC will be authorizing additional funding as it approves remaining applications of the winning bidders from the auction.

Here are the awardees in Minnesota:

  • Federated Telephone Cooperative receives $1,431,039 (over 10 years)
    to bring minimum speeds of 1 Gbps/500 Mbps to 808 locations
  • Roseau Electric Cooperative receives $2,081,770 (over 10 years)
    to bring minimum speeds of 1 Gbps/500 Mbps to 326 locations

FCC Approves Priority Window For Tribes To Expand Broadband

CBS reports on tribal access to licenses…

The Federal Communications Commission has approved a priority filing window for tribes to obtain licenses that could boost internet service in rural communities.

The commission voted 3-2 Wednesday in favor of the filing window for federally recognized tribes.

The 2.5 Ghz-band of spectrum largely is unassigned in the U.S. West and is seen as key to expanding 5G access.

The licenses could help tribes establish or expand broadband coverage in underserved areas. Tribally owned entities, including colleges and universities, also would be given priority for licenses.

US House Ag meeting on broadband Archive – rural areas need gig access

Earlier today the Subcommittee on Commodity Exchanges, Energy, and Credit (Committee on Agriculture) met to hear about: “Building Opportunity in Rural America through Affordable, Reliable and High-Speed Broadband“. I’m pleased to report that two Minnesotans were there to tell the story in our state – Neela Mollgaard at Red Wing Ignite and Dave Hengel at Greater Bemidji.

All of the speakers shed a light on what better broadband and supporting locals to better use that broadband make a difference in a rural community.

Here’s the meeting:

And access to Dave and Neela’s written testimony.

[Update July 15, 2019]

The story of Minnesota’s state broadband funds past, present and future from Matt Schmit

Recently, the Daily Yonder posted an article by (former Senator) Matt Schmit on Minnesota’s Border to Border Broadband grants, specifically the history of the legislation (which he authored) that made it happen in 2014…

The first bill, which created the grant fund, focused on improving service in unserved areas while not ignoring the underserved; achieving technology neutrality while requiring scalability of all state-funded deployments to 100 Mbps /100 Mbps speeds; and encouraging meaningful partnerships among various entities, such as local communities, tribal governments, incumbent and competitive providers, and rural cooperatives.

He mentions the obstacles…

At each turn, we overcame these obstacles, but not without consequence. Concerns over statewide prevailing wage mandates on public funding in rural markets led to a bipartisan exemption in state law, a tweak to the program that has worked well and enhanced program purchasing power. A desire to improve service in underserved areas inspired a small carve-out for targeted investment but to date has produced scant proposals. An infusion of new federal CAF dollars and an interest, however idealistic, in coordinating scarce public resources and leveraging federal funding to maximum benefit led to a challenge process that has failed to push incumbent CAF recipients to provide more competitive service.

And remembers a plan that didn’t work…

As beneficial as Minnesota’s Border to Border program has been, I remain convinced that my other bill was the better bill – and far more likely to inspire greater impact. The bill’s overarching goal was to facilitate local and regional cross-sector collaboration and partnership by introducing new public financing tools to the rural broadband conversation. After all, if lack of private investment capital for scarcely populated service territories remains the fundamental challenge underlying broadband service gaps, this bill sought to address the problem head on.

Intended to provide new tools for local and regional solutions, the legislation clarified and enhanced local bonding authority, enabled creation of regional broadband districts to strengthen cooperatives and public-private partnerships with new taxing authority, and provided a critical source of non-state match funding for state grant program applicants.

Dramatically mischaracterized by one industry lobbyist as the “most radical legislation ever introduced in Minnesota,” the bill never even received a hearing.

And makes some recommendations going forward…

At the same time, the broadband grant program would benefit from a few upgrades. First, multiyear base funding, preferably through a dedicated source that limits its exposure to general fund competition, would provide more stability to the program. Second, a reconsidered incumbent challenge process would help achieve the intended purpose of pushing CAF recipients to invest in better technology and offer faster speeds. Third, new tools and clear authority for local and regional entities to raise non-state funds to match a state grant or forego state funding altogether would improve rural broadband providers’ access to capital.

San Francisco Mayor says whoa to FCC proposal to allow landlords to limit broadband competition

The San Francisco Chronicle reports…

San Francisco Mayor London Breed has spoken out against the Federal Communications Commission’s attempt to overrule a provision of a city ordinance.

In a letter sent on Tuesday to House Speaker Nancy Pelosi, D-San Francisco, Breed wrote that the FCC’s proposal to preempt part of a city law that prevents landlords of multi-unit buildings from blocking tenants from accessing the internet service provider of their choice would hurt residents by reducing competition for communications services.

The provision of the ordinance, known as Article 52, says property owners can’t deny internet service providers access to existing wiring within multi-unit residential and commercial buildings. It was the first such rule in the nation when the Board of Supervisors unanimously passed it in 2016, according to then-supervisor Mark Farrell.

I mostly write about rural broadband – so why the notice of an urban post dealing with multi-unit homes? Because rural areas can feel the same pinch when policy impedes competition. It looks a little different – but the result is the same: lack of choice.

We’ve seen that with CAF II funding where incumbent providers had access to federal money to upgrade to a minimum of 10 Mbps down and 1 up. Once the incumbent accepts that money, they have dibs. (To use a playground term.) Another provider will have a hard time getting federal funding to move into that area – even if they promise better connectivity.

And the even more difficult part of it is that the CAF II is that it isn’t a clear win for the incumbents. The funding isn’t enough to offset the real cost, nor enough to spur a real focus on unserved areas when there are areas with a better return on investment. But there are providers, often cooperatives, whose business model do allow for broadband upgrades that do meet customer need and sufficient ROI. (Last fall, tax changes were suggested that would have made it even more difficult for cooperative to offer broadband.)

The policy impact on rural communities may be familiar to more readers but again the result is the same. One choice! And with one choice, you run the risk of service, speed and prices that suit the provider. In rural areas, it’s federal funding or tax changes. In urban areas, it’s giving that power to one landlord – who may be compensated for making a broadband choice for the building.

There is one proposed budget amendment that may get in the way of the FCC plan…

The FCC proposal has hit at least one bump: The House of Representatives last week approved a budget amendment introduced by Rep. Katie Porter, D-Irvine, that would prevent the FCC from finalizing a draft rule that would overturn a provision of San Francisco’s local ordinance. The amendment was passed as part of a group, but it could still fail in the Senate.

“The communications industry is in dire need of more competition,” Porter said in a statement. “San Francisco’s Article 52 has been incredibly effective in promoting broadband competition — giving residents the benefit of competition and choice in the market, increasing their service quality while decreasing their monthly bills.”

DEED Commissioner Grove plans to put MN on the tech map

 

MinnPost reports

When Steve Grove was appointed commissioner of the state’s Department of Employment and Economic Development (DEED) in January, one of his first priorities was to grow the state’s technology sector to compete with cities like Seattle, Boston and Austin.

 

That agenda is now taking shape with help from the Legislature. In the two-year budget approved in May, lawmakers passed a slate of proposals made by Grove and Gov. Tim Walz to foster startup businesses and build tech companies.

The Legislature re-instituted an “angel” tax credit for people who invest in startups and created “Launch Minnesota,” an initiative focused on nurturing the tech scene with grants, mentorship and collaboration with private businesses. The Legislature also agreed to spend $40 million on a grant program that helps build infrastructure for rural high-speed internet.

DEED did not get everything Grove had wanted, including more spending for broadband internet grants. But Grove, a former executive at Google, said the state is taking critical steps to support a sector that can help create jobs, attract young workers in a tight labor market and put Minnesota on the economy’s cutting edge.

They also report on where Minnesota currently stands in terms of the tech/entrepreneur map…

As a tech region, the Twin Cities is unexceptional. In a 2018 report on tech hubs by commercial real estate firm Cushman & Wakefield, Minneapolis/St. Paul ranked in the second tier of its top 25 cities and regions in the United States and Canada. The Twin Cities were below 10 other places, including Silicon Valley, San Diego, Raleigh/Durham, Seattle and Boston.

The report found the Twin Cities had the 15th highest share of tech employment and its growth in that sector was below average between 2010 and 2017. The Twin Cities also ranked low in venture capital spending, which is used to seed startups.

The report even found Minneapolis/St. Paul had $40 million less venture capital spending in late 2017 and early 2018 than it did in 2011, in a section comparing post-recession funding to current seed money. Chicago had $645 million less venture capital spending than in 2011, but every other tech hub cited by Cushman & Wakefield saw increases.

In 2018, PitchBook reported Minnesota as having the 15th most venture capital spending in the U.S., ahead of some states with similar populations like South Carolina and Wisconsin, but below others like Colorado, Maryland and Utah. “The lack of capital is a disadvantage,” Grove said. “It’s growing, but it’s not where you’d like to see it.”

In the Cushman & Wakefield report, the Twin Cities also had one of the smallest millennial populations by percentage among tech hubs. Many see a large millennial workforce as critical to a tech economy, especially as the country deals with workforce shortages.

The report did cite low rent and property values in Minnesota as positives — at least compared to other tech areas, which have seen extreme surges. And Grove said Minnesota’s tech scene has a lot going for it, including a host of big companies to learn from, startups with a high “survivability” rate and strong “civic pride” in the tech sector.

Senators Introduce American Broadband Buildout Act, A $5 Billion Plan for Rural Broadband Buildout

Benton Foundation reports…

Senators Susan Collins (R-ME) and Doug Jones (D-AL) introduced the American Broadband Buildout Act of 2019 (ABBA), a bipartisan bill to ensure that rural Americans have access to broadband services at speeds they need to fully participate in the modern society and economy by directing the Federal Communications Commission to provide up to $5 billion in matching grants to help states improve broadband infrastructure. The American Broadband Buildout Act of 2019 would:

  • Require that projects that receive funding must be located in “unserved” areas, where broadband is unavailable at speeds that meet the FCC’s standard. Narrowing the focus to these areas will ensure that the money goes where it is needed most, and will also protect against “over-building” where broadband infrastructure is already in place.
  • Require that this federal funding be matched through public-private partnerships between the broadband service provider and the state in which the infrastructure project will be built.
  • Require that projects be designed to be “future proof,” meaning that the infrastructure installed must be capable of delivering higher-speeds as broadband accelerates in the future.
  • Direct the FCC to prioritize the funding of projects in states that have traditionally lagged behind the national average in terms of broadband subscribers and are at risk of falling further behind as broadband speeds increase.
  • Provide grants to states and state-designated entities for digital literacy and public awareness campaigns highlighting the benefits and possibilities of broadband service.

Parts of this plan sound very much like the Minnesota Border to Border Broadband grant program.