Sibley County Discusses Joint Powers Agreement for Rural Fiber-to-the-Farm

Last night, local officials from all over Sibley County gathered in Arlington to learn about the potential fiber-to-the-farm broadband network they could build as early as 2012. Dave Peters, from Minnesota Public Radio, attended and discussed the meeting on MPR's Ground Level blog.

More than 50 elected officials -- county commissioners, city council members, township board supervisors -- gathered in the Arlington Community Center last night to inch ahead a plan to lay fiber optic lines to every home and business in the county plus those in and around neighboring Fairfax in Renville County.

It's an ambitious plan that would require the community to borrow $63 million and then pay off those bonds with revenue from the service. The county-owned operation would offer the usual cable-phone-Internet triple plays, and backers are promising that right out of the gate it would be at a speed of 20 megabits per second, upload and download. That's quite a bit faster than what area residents get now via DSL or cable or wireless.

If the project will move forward, the communities will have to form a Joint Powers Board and seed it with some start-up funds. The next steps will be to do a pre-subscription campaign to get a real sense of how many residents would take service from a new network. Responses are non-binding but will give a better measure of support as well as create an additional sense of responsibility for the project. From Dave Peters:

By the end of February, the 10 governments -- Sibley and Renville counties and the cities of Gaylord, Arlington, Winthrop, Fairfax, Henderson, Gibbon, Green Isle and New Auburn -- will each decide whether they want to create a joint powers board.

The best scenario is that all communities would join. But if one or a few do not, the project may be able to continue as long as some of the remaining communities are willing to take additional risk (which would be rewarded with a higher percentage of net income down the line). As long as the JPA is able to continue, all communities will still be passed by the network and residents able to subscribe. The exception is Sibley County itself; if the County does not join, the project would be hard-pressed to run the fiber out to the farmers and residents outside town limits.

A representative from Frontier attended and passed out some financial data from Windom (I did not see it) - likely suggesting that Windom has "failed" because it has not yet broken even financially. But, as we have frequently discussed, these networks (especially small, rural networks) take many years to break even. I doubt the Frontier rep included a discussion of how many jobs Windom's network has created or preserved, or the many other benefits that have accrued as a result of the network.

This project is still very much in consideration -- even if they move forward to create the Joint Powers Agreement, they will need to have a healthy response to non-binding pre-subscription and will then likely have to pass a 65% referendum required by MN law for such telecommunications projects. And then they will have to finance it, likely with non-recourse revenue bonds or a lease arrangement.

They are asking the right questions -- now we will wait to see how the towns and County react to creating the Joint Powers Agreement.