How at the MN CAF II funded providers doing with deployments? It varies

USAC has just released an update on how providers that received CAF II funding are doing with their deployments. Here’s a high level summary from the USAC website…

Connect America Fund (CAF) Phase II Auction, commonly called “CAF II Auction,” provides support to carriers to deliver service in areas where the incumbent price cap carrier didn’t accept CAF Phase II model-based funding and in extremely high-cost areas located within the service areas of the incumbent price cap carriers. After a reverse auction bidding process (Auction 903) completed in 2018, the FCC awarded a total of $1.49 billion over 10 years to more than 100 winning bidders to provide fixed broadband and voice services to over 700,000 locations in 45 states. Learn more.

CAF II Auction data reflecting total deployment as of December 31, 2021, and reported to USAC as of March 7, 2022, can be found here. This spreadsheet lists the total number of CAF II Auction locations deployed through the end of 2021 by Study Area Code (SAC) and state.

They have a table of how many units each provider has reached; I added a column of how many each provider was assigned/award.

Holding Company State Certified_Units Assigned Units
Federated Telephone Cooperative MN 1,165 808
Paul Bunyan Rural Telephone Cooperative MN 1,207 315
Midcontinent Communications MN 42 7,410
Farmers Mutual Telephone Company MN 68 163
Metronet Holdings, LLC MN 370 672
Garden Valley Technologies MN 86 95
Halstad Telephone Company MN 7 7
Interstate Telecommunications Cooperative, Inc. MN 207 209
West Central Telephone Association MN 491 532
Broadband Corp MN 0 128
Consolidated Telephone Company MN 315 358
Roseau Electric Cooperative, Inc. MN 149 326
Wikstrom Telephone Company MN 53 56
LTD Broadband LLC MN 442 840
Fond Du Lac MN 0 13

As you can see some folks are rocking it; Paul Bunyan is and Midcontinent is not. That being said, the race isn’t over yet. Providers had six years to meet their obligation and we’re only into year three. There are staggered goals. (Posted below.) Especially given the labor and supply chain shortages, there are many reasons a project may not look to be on track. And network building isn’t linear, you deploy communities at a time. But all things being equal, the folks living in areas exceeding required deployments are probably happier.

Carriers must complete:

  • 40 percent of deployments by the end of year 3 (2022)
  • 60 percent of deployments by the end of year 4 (2023)
  • 80 percent of deployments by the end of year 5 (2024)
  • 100 percent of deployments by the end of year 6 (2025)

Wisconsin wary of giving state funding to big broadband providers who already have federal funding

The Racine County Eye reports…

Big telecommunications companies including Frontier and AT&T are asking the state for millions in the most recent round of broadband expansion grants, according to the list of applications submitted to the Wisconsin Public Service Commission.

Many of these companies have already received tens of millions from federal programs to improve service in Wisconsin and across the country. Critics are wary of giving them more public cash.

“My fear is that companies like Frontier, Charter and AT&T will simply use this money to substitute for their existing capital expenses,” Barry Orton, a professor emeritus of telecommunications at the UW-Madison, wrote in an email. “As they have multiple times in the past, they could cherry-pick service areas based on revenue expectations, leaving their less lucrative Wisconsin customers unserved and underserved yet again.”

Past federal programs like the FCC’s Connect America Fund distributed hundreds of millions of dollars to large telecommunications companies with the intention of upgrading service in areas without high-speed internet. But the programs were poorly designed and poorly enforced, said Christopher Mitchell, director of the Community Broadband Networks Initiative, a Minnesota-based think tank that aids communities’ telecommunications efforts. For example, the Connect America Fund only required that projects provide internet speeds of 10 megabits per second of download speed and 1 megabit per second of upload speed, a standard that has quickly become obsolete.

Burying fiberoptic lines in the ground for high-speed internet is expensive, and national companies have little financial incentive to make that investment in rural areas with few potential customers. Experts like Orton and Mitchell accuse those big telecommunications companies of using the federal funds in more populous profitable areas rather than rural ones, saying the federal grant programs were too lax.

Some of the players may be different in Minnesota but the federal funding isn’t.  Right now the frustration with federal funding in Minnesota is in RDOF fund limbo areas such as Le Sueur County where LTD Broadband has been given the opportunity to get federal funding but it hasn’t yet been awarded but for the last year it has had “dibs” on that area and therefore locals were unable to apply for state funding.

Part of the frustration on the frontlines is having experience similar to Wisconsin with providers who have received federal funding that has not improved home access for their customers. If the wait were the worry, there would be some frustration but a wait for an award similar to those that have not panned out in the past is like Waiting for Godot.

Three data points to help plan for IIJA broadband funding

The Benton Institute for Broadband and Society has come out with a helpful help report on three data points that will help plan for Infrastructure Investment and Job Acts Broadband Funding. Here are their three points…

As policymakers begin to plan how to use Infrastructure Investment and Jobs Act (IIJA) funds to increase broadband connectivity, there are three important data points from two recent surveys to keep in mind:

  1. Some 32% of households are subscription vulnerable, that is, they struggle to maintain service and have a very difficult time affording service.
  2. Only 18% of cellphone-only respondents were “very satisfied” with their online access for activities such as school or work, activities that moved online during the COVID-19 pandemic.
  3. Some 35% of households with no internet connectivity were largely unable to use outside resources (e.g., friends or community organizations) for “proxy” internet use during the pandemic.

These data points offer “do’s” and “don’ts” for broadband planners and other decisionmakers:

  • Do not think that getting people online is a one-time transaction; prepare for the long-term to provide resources to keep people online.

  • Do not expect those relying only on smartphones to effectively engage online with educational or health resources; have laptop or tablet computer distribution programs in place.

  • Do not underestimate the challenge, given how many low-income people have very limited internet experience; prepare to provide them with one-on-one help.

Jayesun Sherman running for State Representative in SW MN – broadband makes his shortlist

The Worthington Globe reports

Jayesun Sherman, a four-year member of the Windom City Council as Councilman-at-Large (Mayor Pro Tem), has announced his candidacy for the Minnesota State Representative seat being vacated by Rep. Rod Hamilton, who is retiring at the end of this year.

Broadband seems to make his top list of concerns…

“There are a host of needs in southwest Minnesota, which include childcare, broadband and infrastructure repair/replacement,” Sherman said. “In Windom alone, we are more than 250 childcare slots short. Statewide, the number is closer to 19,000. Government daycare centers may help to some degree, but we need much more. The mile-long red tape must be curtailed, and reasonable minds must prevail.”

MN House introduces bill to exempt fiber for broadband from sales and use taxes

Minnesota House of Representatives reports…

Taxes can be complicated, but sometimes tax law makes things more complicated than they need to be. Take, for example, the Border-to-Border Broadband Development Grant Program that Minnesota launched in 2014.

It was designed to make the internet more accessible to residents throughout the state, and, in 2017, its accompanying tax provisions were revised to create a sales tax exemption for such telecommunications capital equipment as fiber and conduit. Or so legislators thought.

It turns out that the Department of Revenue had a narrow interpretation of what constituted “telecommunications capital equipment,” applying it only to telephone service. Hence, companies providing both phone and internet through their fiber optic cables have had to, for tax purposes, separate out the portions of fiber that have data or information from those used exclusively for telephone service. And that’s hard to do.

HF4422 is out to fix that. Sponsored by Rep. Julie Sandstede (DFL-Hibbing), it would exempt from state sales and use taxes any fiber and conduit purchased by broadband or internet service providers to provide retail internet access service. The exemption would be effective retroactively for sales and purchases made after July 1, 2017, with a special refund provision governing refund claims for the retroactive purchases.

The bill was laid over…

The House Taxes Committee laid the bill over, as amended, Thursday for possible inclusion in the omnibus taxes bill, which is expected to be released on Monday. Its companion, SF3480, sponsored by Sen. Torrey Westrom (R-Elbow Lake), awaits action by the Senate Taxes Committee.

The Department of Revenue estimates the change would reduce the General Fund by $14 million in fiscal year 2023 and $6.3 million in the 2024-25 biennium.

Telehealth Benefit Expansion for Workers Act offers telehealth as standalone service

Healthcare IT News reports

The House of Representatives has drafted a bill that would provide new virtual care options for American employees.

WHY IT MATTERS
The proposed Telehealth Benefit Expansion for Workers Act would enable job creators to offer standalone telehealth service programs – not unlike dental and vision plans – in addition to existing health insurance plans.

The legislation was introduced by Reps. Suzan DelBene, D-Wash., Jackie Walorski, R-Ind., Tim Walberg, R-Mich., and Angie Craig, D-Minn. It would expand access to employer-sponsored health benefits by classifying telehealth as an excepted benefit.

Specifically, the bill would amend HIPAA and the Affordable Care Act to allow employees to receive this benefit, maintaining that any standalone telehealth service would remain separate from traditional health plans, rather than as a replacement.

FCC announces latest RDOF winners including $15M to Qwest in Minnesota

The FCC announces the latest (8th round) RDOF Winners

By this Public Notice, the Rural Broadband Auctions Task Force (RBATF), Wireline Competition Bureau (WCB or Bureau), and the Office of Economics and Analytics (OEA) announce they are ready to authorize Rural Digital Opportunity Fund (Auction 904) support for the Auction 904 winning bids identified in Attachment A of this Public Notice.

There is one winner in Minnesota:

Qwest Corporation
Census blocks: 516
Locations: 3,265
Total Award: $15,646,133.10

On a related note, CNS has updated their interactive map to include the latest awards.

No awards or mention, that I could see, of LTD Broadband, which leaves a lot of people, especially in Minnesota, in the lurch about will they or won’t they get funding and how can they prepare for their next steps.

MN Rural Broadband Coalition Day on the Hill notes

Today the MN Rural Broadband Coalition held their Day on the Hill. I was a little late to the meeting as it conflicted with a hearing at the MN House – where they move two bills to put $100 million into broadband in general funding to Ways and Means. Throughout the day, we heard from legislators, providers and community leaders about broadband. Some high level observations:

  • Broadband education is never a waste of time. The issues become more complex and it’s difficult to keep up.
  • The MN House and Senate have slight differences in their bills to invest in broadband grants but seems like maybe the $5 million project cap and 50 percent match may change.
  • There are concerns with slowness of the federal process, labor shortages and supply chain issues
  • Broadband funding in Minnesota general funds would help bridge the gaps created by federal decision making

Here are some screenshots of various presentations and I have details (but probably not complete) notes from the day below.

 

Presentation from Commissioner Grove
Q: How much to get broadband to everyone?
A: $1.3 billion
DEED: We have $500 million on the horizon from feds. We anticipate more funding and investment from provide providers. We think we need $170 million in State funding Continue reading

EVENT Mar 30: Broadband Bill hearing in House – Industrial Education and Economic Development Finance & Policy

Looks like this will happen immediately before the MN Broadband Coalition Day on the Hill

Wednesday, March 30, 2022 at 8:30 AM

Chair: Rep. Gene Pelowski, Jr.
Location: Remote Hearing
Agenda:

HF 14 (Ecklund) Broadband grant program money deposit transferred.
HF 4375 (Ecklund) Commissioner of employment and economic development required to prepare and submit federal fund application, and money appropriated.
Additional items may be added to the agenda.
**If you are interested in providing written or oral testimony please email the Committee Administrator by 5 pm the day before the hearing.
CA: Owen.Wirth@house.mn
This remote hearing may be viewed via the House webcast schedule page: https://www.house.leg.state.mn.us/htv/schedule.asp

New federal law reduces maternal mortality – in part with access to telehealth

KNSI (St Cloud) reports

A bipartisan bill to reduce the country’s high maternal mortality rate has been passed into law as part of the omnibus bill.

Senator Tina Smith, author of the Rural Maternal and Obstetric Modernization of Services, or MOMS, Act, says the U.S. is 46th in terms of maternal mortality rates and the only industrialized country where the number of women who die in childbirth is getting worse and not better. When she learned about those statistics, she also learned that half of the rural counties in Minnesota have birthing services in their hospitals. Both the Pew Trust and the Commonwealth Fund have written about the increase in the closure of OB units and the heavy reliance on midwives to fill the gap, potentially placing women and babies at risk.

Smith explains the MOMS Act “provides additional resources and training to rural hospitals and clinics to help them improve their maternal care, prenatal care, and as well as postpartum care when moms and babies go home it even allows for additional use of telehealth, which can make a big difference in improving prenatal care and postpartum care when babies come home.”

Smith stressed the telehealth angle in that when new parents in more rural areas who have a long drive to get to their prenatal or postpartum care stay connected to their providers, instances of postpartum depression can be identified early and treated before it becomes serious. She added that telehealth is not a replacement for face-to-face care, “but it can make a difference for moms as they do some of that more routine prenatal care, which is important because that reminds you; am I eating the right things? Am I taking the vitamins that I need? And also maybe I have some symptoms I don’t understand that can be evidence that you need to get into the doctor’s office because you might be having issues with hypertension or other kinds of early warning signs for a meeting that meaning that you have a higher risk pregnancy and needs to be seen the doctor more often.”

Views on the MN Broadband Line Extension bills

Public News Service reports on the Line Extension bill…

Thanks to state and federal commitments, Minnesota soon will unleash a large sum of funding to ensure more residents have broadband internet access, but industry groups warn of missing homes as work ramps up and hope a legislative plan addresses logistical issues.
Last year, Minnesota lawmakers approved spending $70 million dollars to expand the state’s networks for high-speed internet. A House bill would create a specialized grant program to convince providers to extend cable lines to homes in far-flung areas.
Rep. Jordan Rasmusson, R-Fergus Falls, the bill’s sponsor, said Minnesota needs to get the effort right.
“Policymakers and stakeholders need to examine every part of the funding and construction process and eliminate as many barriers to deployment as possible, ensuring no one is left behind,” Rasmusson asserted.
Issues include some homes showing up on broadband maps as served, even though they are not connected, hurting their eligibility for assistance. Rasmusson added existing grant programs are too large to cover a handful of smaller properties. The $70 million comes from American Rescue Plan funding, on top of other federal dollars being made available to the state for broadband development.
The bill, which has bipartisan support, cleared a House committee this week and was sent to another panel in the chamber.

MN Broadband Task Force March Meeting: Fond du Lac story and adoption in MN

Today the MN Broadband Task Force got presentations from two of its members: Jason Hollinday from Fond du Lac Band of Lake Superior Chippewa and Bernadine Joselyn.

Jason talked about the history of Fond du Lac’s broadband network. They started working on broadband in 2005. They approached all angles – they built demand, wrote grants, realized fiber was the answer and became the fiber broadband provider and ETC (eligible telecom company). They overcame challenges of ruralness and internal capacity.

Bernadine talked about the three legged stool of digital equity – access to broadband, devices and the knowledge to use them. Broadband access is lower in rural areas – in part because of the demographics of rural areas – older people, low income and less education. She included a video of speakers from rural areas on why they appreciated and/or needed better broadband depending on their situation.

The group also looked at what topics they would address in 2022:

  • Funding and investments
  • Updated Mapping and Usage
  • Affordability and adoption

FCC Announces Third Application Window, Emergency Connectivity Fund Commitments

The FCC reports on another funding opportunity…

The Federal Communications Commission today announced that it is opening a third application filing window to award at least $1 billion in Emergency Connectivity Fund support. The third application filing window will open on April 28, 2022 and close on May 13, 2022.
During this third application filing window, eligible schools and libraries can submit requests for funding to purchase eligible equipment and services between July 1, 2022, and December 31, 2023. Given past demand, the third application filing window will likely be the last opportunity for schools and libraries to request funding before the remaining Emergency Connectivity Funds are exhausted.

Additional information on the third application filing window can be found here.

MN House Committee moves forward bill to use Border to Border funding for line extensions to individual homes

This morning the House Industrial Education and Economic Development Committee referred HF 3605 to Judiciary Finance and Civil Law Committee. This bill looked at two tools that will help broadband providers reach more households: Line Extension and Easements.

This bill was heard in a Senate Committee earlier this month. The quick take is that the bill takes money from the Border to Border grant program to award to homeowner projects rather than communitywide projects. The bill asks that the Office of Broadband create a portal where people who feel underserved can submit a request for better service; every 6 months those addresses will be made available to broadband providers who can bid (up to $25,000) to extend their connections to the homes. (I have written about the bill in previous posts.)

The railroads had concerns about the easement portion of the bill in the Senate. That concern seems to have dissipated. (The cooperatives received the ability to use easements last year; the railroads seemed to not notice that bill.)

The big question from Representatives is how long it might take to get broadband to everyone spurred by the fact that this bill sets a cap of $5 million per year for the first three years of the program. The cap would be lifted after the third year. The answer given was it could take a few years.

MRBC Update: House Committee Hears Line Extension Bill

From the MN Broadband Coalition…

House Committee Hears Line Extension Bill
The House Industrial Education and Economic Development Committee heard HF 3605 this morning. This bill is the Line Extension/broadband easements bill sponsored by the Minnesota Cable Communications Association that was heard last week in the Minnesota Senate. The committee adopted an amendment to the bill (more details below) and then unanimously passed the bill to the House Judiciary Committee for further consideration. The bill is authored by Rep. Jordan Rasmusson (R-Fergus Falls) and has 15 bipartisan coauthors. The Coalition sent a letter (more details below) to the committee outlining our support for the changes made to the bill, but also our concerns that more funding is needed in the Border-to-Border program to make sure larger, community-based projects are not pushed out for lack of funding.
You can read more details about the bill here.
The amendment that was adopted makes several major changes to the proposed program. These changes were requested by the Coalition:

  1. Confirmatory language that grants would only be issued for projects that are scalable to speed requirements of 100mbps download and 100mbps upload. This language assures that potential projects would not be built to standards below those of the existing Border-to-Border grant program.
  2. Precluding grants from being issued to households that are part of a grant already issued by the Office of Broadband Development for the Border-to-Border grant program. Additionally, if this bill becomes law, the Coalition will request that OBD issue Border-to-Border grants first so larger, community-based project applications wouldn’t need to be altered from conflicting line extension project application.
  3. A cap of $5 million per year for the first three years of the program. The cap would be lifted after the third year.

The Coalition also requested that a separate appropriation be made for this program, but that request was not amenable to the bill author or MCCA. The Coalition remains concerned that his new program would put stress on the limited amount of funding currently available for the Border-to-Border program. Federal funding from various programs has still not arrived in the state—and may not for some time—and we are skeptical that the RDOF program’s preliminary auction awards will be fully approved, with potentially several hundred million dollars not coming to Minnesota. We will continue to advocate for additional funding for the grant program this session and will soon be asking you to write to your elected officials to let them know that you support more funding for the grant program.

You can read the letter the Coalition wrote to the committee below:

March 23, 2022

Dear Chair Pelowski and Committee Members,

On behalf of our member organizations, we write to you today to share our thoughts on HF 3605. The Minnesota Cable Communications Association has worked with the Coalition to incorporate suggestions from our member organizations that are reflected in an amendment before you today. These include confirmatory language that grants would only be issued for projects that are scalable to speed requirements of 100mbps download and 100mbps upload. This language assures that potential projects would not be built to standards below those of the existing Border-to-Border grant program. Additionally, MCCA and the bill author included language that would preclude grants from being issued to households that are part of a grant already issued by the Office of Broadband Development for the Border-to-Border grant program. Finally, a cap of $5 million per year for the first three years of the program has been included in today’s amendment. The Coalition supports these changes.

The Coalition is concerned that, with limited funds currently available, some larger, community-based projects will be passed over by the Border-to-Border grant program. Any grants for this new pilot program would use the same funding source as the Border-to-Border grant program. There is $35 million for FY22 and $35 million for FY23 from the American Rescue Plan Act’s Capital Projects Fund that was allocated by the Legislature during the last legislative session. More funding is desperately needed to reach the 240,000 households across the state that lack access to our state’s 2026 speed goal of 100mbps/20mbps. Additional funding would ensure that communities that have worked hard to partner with internet service providers for a Border-to-Border grant do not miss out because there isn’t enough money in the bank.
The Coalition supports Section 3 of the bill related to broadband easements. This language would streamline the process of rolling out service to households in rural Minnesota.
The Coalition would like to thank MCCA for graciously incorporating the changes listed above. We will continue to work with them as HF 3605 moves through the legislative process.  
Respectfully yours,
Jay Trusty
Chair
Minnesota Rural Broadband Coalition