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Islesboro and Rockport: So Near and Yet So Far (On FTTH Vote)

Rockport was the first community in Maine to build a fiber-optic network to serve businesses, but their pioneering initiative will not extend to Fiber-to-the-Home (FTTH). At their annual town meeting on June 15th, the local Opera House was packed as citizens showed up to speak on funding an FTTH engineering and network design study. After an extended debate, attendees voted on the measure and defeated the town warrant to spend $300,000 on the project.

According to the Penobscot Bay Pilot, passions flared as a number of people stood up to explain their vote. Several people in support of the project had previous experience with life after fiber:

Deborah Hall, on the other hand, said she led an effort in another state to take fiber optics to 500 homes. That effort resulted in the fact that the “average resident is now saving 100 dollars every month in getting rid of Comcast.”

She recounted how the fiber optic system already in place in Rockport was a draw for her family to return to live in the town. They improved their Internet on Russell Avenue by personally spending the money to extend the fiber to their home, and consequently “reduced our collective Internet and television bills by $155 a month. That’s over 50 percent.”

Rockport’s youth described their dilemma, living in a place where connectivity was less than adequate:

Thomas R. Murphy said he also grew up in town but said: “I am leaving this town to seek a technology career, and am moving to Austin. I have to do this because we do not have technology in this town.”

He warned that sticking with the status quo, residents were paying a company “to make profits and take profits to shareholders in other places.”

“We can keep our resources here and improve lives of everyone. This is an investment we need to make for our future. Costs can be spread thoughtfully by the town, and we can pay forward to the future of the town.”

People at the meeting who did not support the project did not like the idea of paying an estimated $150 more per year in property taxes, even though it would significantly lower monthly Internet access rates while offering better service. The measure failed 59 - 92.

Meanwhile in Islesboro…Islanders Sing A Different Song

Across the water of the West Penobscot Bay is an island community of fewer than 600 people. Once Islesboro began taking steps to improve connectivity with publicly owned Internet infrastructure in March 2015, they did not look back.

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On June 18th, voters at the annual town meeting authorized $3.8 million in borrowing with a final vote of 143 - 23. The community will issue a municipal bond paid for with a slight increase in property taxes.

The GWI Blog reports that Islesboro’s plan will provide Gigabit per second (Gbps) Fiber-to-the-Premise (FTTP) access to each business and residence on the island. The network should be completed by spring 2017 and all customers should be connected by the end of the summer. Gigabit connectivity will cost approximately $360 per year. GWI will provide Internet access via the city-owned fiber.

According to Town Manager Janet Anderson, the outcome of the vote relied on educating residents: “It came down to showing the voters how a municipally owned Internet system could be a benefit as well as a simple, good deal for them,” she said.

When folks in Leverett, Massachusetts, considered the financial implications of a fast, affordable, reliable municipal network, they also realized that owning their own infrastructure would give them the best deal. In addition to paying less overall, customers of LeverettNet are getting better Internet access than they can obtain from the incumbents. They keep dollars in the community and they make decisions about the services they will receive.

Page Clason, a member of Islesboro’s Broadband Committee who was instrumental in bringing the initiative this far said:

“We are building a digital bridge to the mainland. By making gigabit Internet available to everyone at an affordable price, we will step to the right side of the digital divide. By building and owning our own network, we control our own destiny. Self-reliance has always been a strong island value.”

Expansion Ahead For ECFiber

The East Central Vermont Community Fiber-Optic Network (ECFiber), a 235-mile Fiber-to-the-Home (FTTH) network that currently connects over 1,200 customers across 24 small towns in east central Vermont, is doing well. It’s doing so well, in fact, that a capital investment group will commit $9 million in long-term financing to the network, a loan that will allow ECFiber to expand and spend down some of its existing debt. 

ECFiber announced last month, that it will use about half of the funds to activate 110 miles of existing fiber this year and add 250 more miles of fiber in 2017 bringing the network to approximately 600 miles. Network officials will use the remaining funds to pay down $7 million in debt; the move will allow ECFiber to save money through reduced interest rates and spread out loan payments over a longer period of time.

Stability Begets New Financing, New Possibilities

The news of this new injection of debt financing comes several years after the original plan to build a larger 1,900-mile, $90 million FTTH network ultimately didn’t materialize in the aftermath of the financial crisis of 2008. When ECFiber failed to secure debt financing for that larger plan, the network scaled back its ambitions, turning to direct investments and raising $7 million from 479 local investors to construct the current network.

This self-financing strategy (for more, listen to our Chris interview Carole Monroe, former General Manager in Community Broadband Bits podcast #177) made ECFiber a reality. This new financing will allow the network to expand at a faster pace and allows ECFiber to significantly stretch its footprint. In the past, the crowd funding approach allowed for targeted, smaller expansions.

The network became eligible for the new debt financing after ECFiber officials took proactive steps in recent years to demonstrate the network’s commercial stability. First, they released audited financial statements for the past three years and showed positive cash flow since the end of 2014. In addition, ECFiber officials took advantage of a new Vermont law that allowed them to change the network’s official governance structure. The shift away from a somewhat unusual inter-local agreement into a “communications union district,” is more familiar and appealing to investors.

“[The restructuring] was an important thing,” said ECFiber Treasurer John Roy. “It would have been much more difficult to borrow by going to investors and financiers (as an inter-local agreement entity) and they would say, ‘Huh, what?’ But if you say you’re a ‘union district,’ that is a recognized ‘body corporate and politic’ and they understand that.”

In order to determine where to expand, network officials are asking Vermonters in the region to pre-subscribe. Communities with the highest number of sign-ups will move to the front of the expansion list.

BT Advisory Board and Community Agree: Local Is Best

As Burlington, Vermont, searches for a buyer for Burlington Telecom, the local residents and business owners continue to remain engaged in the future of their beloved Fiber-to-the-Home (FTTH) network. Most recently, they made it clear that their first priority is finding a local company to own and operate the fiber network.

VT Digger reported that, according to a survey conducted by the BT Board of Advisors:

Several residents have said they would like to see Burlington Telecom sold to a locally owned co-operative and that their greatest concern is the utility being sold to one of its larger competitors such as Comcast, AT&T or FairPoint.

From the report:

Though the City is precluded by the terms of its settlement Agreement with Citibank from continuing to own the Asset, a carried equity interest is permitted. It is important that all ownership options be explored and considered in light of the legal requirements and the City’s goals for BT. However, the BTAB [Burlington Telecom Advisory Board] agrees with the vast majority of interested participants in this process that the sale of BT to one of its existing, national competitors would likely not be in the overall best interests of the City. 

At a recent meeting, David Provost, chair of the advisory board said, “The best option from our perspective is finding a buyer with ties to the local community that will allow the city to have a minority stake in Burlington Telecom."

A Troubled Past, An Uncertain Future

After years of cover-ups by the city's past leadership, CitiBank eventually sued Burlington for $33 million. The parties settled and, as part of the settlement, Burlington transferred ownership to Blue Water LLC, a company formed by Burlington businessman Trey Pecor. In exchange, Blue Water provided $6 million in bridge financing to allow the city to settle the lawsuit with Citibank. The city is still leasing the network temporarily but the ultimate goal is to find a partner to purchase the network. 

According to the terms of the settlement, Burlington can choose the new buyer but the sale must be finalized by January 2019. If not, Blue Water can choose the buyer and residents are worried it may end up being a company like Comcast, with no interest in the local community.

In December, as the BTAB wrapped up public meetings about the future of the network, VT Digger reported:

“We’ve heard very little to date about the $17 million,” Provost said, which is the amount of taxpayer money that was spent without authorization during Mayor Bob Kiss’ tenure to prop up Burlington Telecom. Provost said that’s come as a surprise, given the angry reaction from the public when that was revealed in 2009.

But at Wednesday’s meeting, participants weren’t evenly split on the issue. Most said they would like to see the city or residents retain some level of ownership in Burlington Telecom. One resident explained that, as a taxpayer, she would rather be able to use the asset than recoup the loss.

Residents Take Action

In late 2012, the Keep BT Local! Cooperative formed in an effort to maintain public ownership of the network. The co-op has been collecting equity and loan pledges with the long-term goal of obtaining approximately 4,000 residential and business membership pledges. The effort is ongoing and the group has said on their Facebook page that Members will be hearing more soon.

OpenCape Institutional User Sees Internet Speed Double

A major institutional customer on the OpenCape fiber optic network in the Cape Cod region of Massachusetts is now enjoying Internet access at double the speed. 

CapeCod.com reports that local CapeNet, the supplier of service over the OpenCape network, has doubled the Internet speed for the Woods Hole Oceanographic Institution (WHOI) from 1 Gigabits per second (Gbps) to 2 Gbps. By switching to CapeNet as its primary provider, WHOI now also has the ability to expand up to 10 Gbps.

Previously, CapeNet provided 100 megabits to WHOI as a secondary provider, but the research and educational organization was interested in dramatically increasing its Internet capacity. In order to increase capacity, WHOI needed to make the switch to CapeNet.

CapeNet, the private provider that operates via the CapeNet fiber infrastructure, offers services across southeastern Massachusetts and to every town on the Cape. In addition to 150 institutional customers, the network connects businesses that handle large data, libraries, colleges, high schools, research facilities, municipal buildings, healthcare clinics, and public safety agencies. It is middle mile infrastructure, which means it links the Internet backbone to organizations and businesses that serve end users.

To become the primary broadband provider for WHOI, CapeNet installed additional equipment in Boston, Providence, and throughout the research campus. “It was actually quite a substantial undertaking in order to expand their capabilities,” said Alan Davis, chief executive officer of CapeNet.  

CapeNet On The Move...To Businesses and Residents?

CapeCod.com also reports that CapeNet is: 

...[C]ontinuing to expand services to educational institutions on the Cape. 

“We hope and expect that by the end of this year, certainly no later than next year, that we will actually be the primary provider of all the high schools on Cape Cod if not the middle schools and elementary schools as well,” said Davis.

The network will also be expanding fiber to 59 cell towers so a major mobile provider can expand coverage for customers in the area.

CapeNet recently announced that it would begin reaching out to residents and businesses in Falmouth, where the network serves 19 municipal facilities. OpenCape will soon host a survey on its website for local residents so the partners can obtain a better perspective on whether or not there is interest in the community. The results of the survey will determine if they move ahead with residential and business connectivity.

OpenCape History 

Started in mid-2013, the OpenCape is a 475-mile fiber-optic network serving more than 100 community anchor institutions in southeastern Massachusetts, the South Coast, and South Shore.  The middle-mile infrastructure was funded with a $32 million grant from the Broadband Technology Opportunity Program through the American Recovery and Reinvestment Act (ARRA) and about $8 million in funds from the state, county, and private-sector partner CapeNet.

Dan Gallagher, senior consultant to OpenCape Corp., and Davis wrote in an OpenCape blog last year: 

 “With the support and backing of the community, CapeNet and OpenCape are aggressively pursuing a broad range of funding sources to complete laterals and last-mile connections that will allow our region to unleash this great resource. Accomplishing this goal will allow OpenCape to fulfill its mission of improving the quality of life for the residents in our community.”

Not Nuclear Power, but the Power of Connectivity in Vernon, Vermont

Vernon, Vermont, is a little town in search of a boost to the local economy. The Commons reports that residents formed a Fiber Optic Committee in June and now are exploring the possibility of a municipal network.

First an Idea, Now a Plan

In December of 2014, the Vermont Yankee Nuclear Plant in the town began to shutdown. Over the next few years, as the plant ends operations, it will eliminate a total of 400 jobs in a town of 2,200. Vernon is looking for other keys to economic development.

A local resident came up with an idea -- fiber optics. Vernon's Munson Hicks, is now a member of the 5-person Fiber Optic Committee seeking to find a way to make the idea a reality:

“I couldn’t think of anything that would boost the town more quickly and more securely after the loss of VY [Vermont Yankee Nuclear Plant] than creating our own high-speed Internet” 

The committee has spoken with contractors, and consultants in order to develop a realistic idea of the cost. They estimate a price tag of $2 - 3 million for a Fiber-to-the-Home project. They are considering a consortium model - crossing state lines, with neighboring towns Hinsdale, New Hampshire, and Bernardston, Massachusetts.  

What’s Next for Vernon

The Vernon Planning Commission has not endorsed the plan yet; the Fiber Optics Committee still has a long road ahead of it. They have to confirm community support for the plan and find funding through grants or loans.

At the January 19th community forum, Committee members shared their findings with residents and explained the need for grassroots mementum:

“Really, I think we need to look at this as an economic development initiative for Vernon,” [Committee Member Martin] Langeveld said. “Businesses already need this kind of speed or very soon will need this kind of speed, so having that in town will really be a big plus in trying to get more businesses to locate here.”

Speeds Up, Prices Steady (or Down!) With EC Fiber

The East-Central Vermont Community Fiber-Optic Network (EC Fiber) recently announced plans to increase speeds across tiers with no increase in prices.

Changes will look like this:

  • "Basic" will increase from 7 to 10 Megabits per second (Mbps)
  • "Standard" will increase from 20 to 25 Mbps
  • "Ultra" will double from 50 to 100
  • The new "Wicked" plan will increase from 100 to 500 AND will include a price decrease. (Current subscribers to the Wicked tier who pay for 400 Mbps will also get the bump up to 500 Mbps and the price decrease.)

All speeds from EC Fiber are symmetrical so both download and upload are equally fast.

Self-Funded at the Start

Twenty-four communities in Vermont make up the consortium which began in 2009. The towns joined forces to deploy a regional Fiber-to-the-Home (FTTH) network when large corporate incumbent providers chose to invest elsewhere. Slow DSL was the best option in the area and local residents, businesses, and local institutions needed better connectivity.

Individual investors funded the initial network buildout but last year a new Vermont law took affect that allows towns to create "communications union districts." EC Fiber now functions under such a governance structure and organization officials expect to more easily attract larger investors and borrow at lower interest rates. EC Fiber hopes to answer requests to expand beyond its 24 member towns.

Characteristic Altruism

Increasing speeds with little or no rate increases is typical of publicly owned network communities. Tullahoma's LightTUBe, Chattanooga's EPB Fiber, and Lafayette's LUS Fiber have done it, often with little or no fanfare.

Publicly owned networks are also known to shun data caps, another tool big players like Comcast use to squeeze every penny out of subscribers. EC Fiber summed up why data caps are inconsistent with the publicly owned network philosophy:

An uncapped internet environment encourages entrepreneurs and economic growth. Despite the trend toward instituting data caps among commercial internet providers, ECFiber believes that caps are inconsistent with its mission as a community network. An unconstrained online environment frees businesses and individuals to be creative and innovative.

New Vermont Law Bolsters Prospects for Investing in Community Broadband Networks

A new state law is on the books in Vermont that supporters expect will encourage more investor activity supporting community broadband networks. 

The new law, which took effect this past June, allows for the creation of “communications union districts,” enabling towns and cities to band together to form geographic entities dedicated to establishing fiber-optic broadband networks for their area’s residents and businesses. 

A New Nomenclature

While Vermont towns have been able to work cooperatively via inter-local contracts, the new law is less cumbersome and uses a governmental nomenclature more familiar to most people—the union district. The union district governance model has been used for many years throughout Vermont, including by various utilities that have multi-town operations to handle, for example, sewer and water service.  

Carole Monroe; general manager of the East Central Vermont Community Fiber-Optic Network (ECFiber), a consortium of 24 Vermont communities that have banded together to provide broadband service; told our Christopher Mitchell there isn’t much practical difference for her group operating now as the East Central Vermont Telecommunications District instead of by an inter-local contract.  

“But I can say that in the municipal investment markets, they’re much more familiar with the municipal utility district, whether it’s a water district or sewer district or something along those lines,” Monroe told Chris in a recent edition of Community Broadband Bits podcast. “A municipal utility district is a common language for them. Inter-local contracts, not so much.” 

ECFiber Grew From Inter-Local Contract 

Irvin Thomae, chairman of the EC Vermont Telecommunications District board, agreed. He noted that seven years ago the east central Vermont communities created ECFiber through an inter-local contract. “But this (the inter-local contract) was unfamiliar to investors beyond our state borders,” Thomae told us.

“We needed a structure more capable of being recognized by large institutional investors. It (the communications union district) makes it easier for community broadband networks to appeal more for large investors.”

Jerry Ward, an ECFiber delegate from Randolph Center, earlier in 2015 urged residents of his community to vote to approve the governance change to a telecommunications utility district. He predicted in an opinion article in The Herald of Randolph, the union district model will be a boon for ECFiber: 

“Most of the money we’ve raised until now has come in small multiples of $2,500. The governance structure allowed by a Telecommunications Municipal Utility District should help ECFiber attract larger investors at more favorable interest rates. We expect that reorganizing along the lines of a municipal utility district will make it significantly easier to borrow enough money to build out our network much more rapidly than the 50 miles/year we’ve averaged so far.”

During the past four years, ECFiber, under its inter-local contract, has borrowed more than $7 million from predominantly about 450 local investors, connecting nearly 1,200 customers in parts of about a dozen towns, along 200 road miles of fiber-optic cable. Its customers include residents, businesses and institutions. The vast majority of the 24 towns in the ECFiber district are communities of less than 2,000 residents with a handful boasting between 4,800 to 10,000 people. 

Ward noted thousands of other residents still don’t have access to high-speed Internet.  “The rate at which we (ECFiber) can grow depends almost entirely on capital,” he said.  EC Fiber became a communications union district shortly after Vermont Gov. Peter Shumlin signed the new law on June 1, 2015.

ECFiber offers latest Internet speeds

Currently, ECFiber offers the latest generation symmetrical Internet access and a choice of five speeds (from 7 Mbps to 400 Mbps) that do not vary by time of day or according to the weather - as well as phone service with unlimited long-distance calling in the U.S. and Canada, according to its website.

Under Vermont’s communications union districts, the member towns can help facilitate the broadband networks with obtaining easements from property owners along the fiber-optic cable routes, including putting up poles and laying conduit. ECFiber’s union district board is comprised of one delegate per town with each community also able to send one or two alternate delegates to the board’s monthly meeting. 

Under the new Vermont law, a communications union district, such as EC Vermont Telecommunications, isn’t allowed to assess taxes for the initiative. (Note: This was also true for ECFiber when it carried out its operations under its inter-local contract.) A communications union district’s revenue come from subscriber fees. Currently, the ECFiber district is generating about $125,000 a month in subscriber fees, Thomae told us. 

Currently, while ECFiber is the only communications union district in Vermont, Thomae said he has had a few inquiries from other people in the state asking about the new governance structure. 

Monroe said the creation of the ECFiber network has given people in Vermont’s rural east central region an alternative to DSL service, which usually is poor at best. For people not connected to a high quality network, fast and reliable Internet service also can be a problem because the East Central region’s mountainous terrain inhibits satellite service and reception from cell towers, she told us.   

Maine House Representative Pushes for Better Internet Access - Community Broadband Bits Podcast 180

Eleven months ago, we noted the incredible energy in the Maine Legislature around improving Internet access. Maine State Representative Norm Higgins joins us this week for Community Broadband Bits Podcast episode 180.

Rep. Norm Higgins, a newcomer to the Legislature, pushed hard for legislation to encourage municipal open access networks as well as removing barriers to increased investment including a tax on the Three-Ring Binder project. He was part of a large majority that moved some key bills forward despite fierce opposition from Time Warner Cable and others.

We talk with Rep. Higgins about the various bills, including LD 1185, which would have created planning grants for community owned open access networks but passed without any funding.

Read the transcript from this episode here.

We want your feedback and suggestions for the show - please e-mail us or leave a comment below.

This show is 18 minutes long and can be played below on this page or via iTunes or via the tool of your choice using this feed.

You can can download this Mp3 file directly from here. Listen to other episodes here or view all episodes in our index.

Thanks to Arne Huseby for the music, licensed using Creative Commons. The song is "Warm Duck Shuffle."

Local Internet Improvement Districts in New Hampshire - Community Broadband Bits Podcast 179

Local governments in New Hampshire are quite limited in how they can use public financing to invest in fiber optic networks, but Hanover is exploring an approach to create voluntary special assessment districts that would finance open access fiber optic networks. Town Manager Julia Griffin joins us for Community Broadband Bits Episode 179 to explain their plans.

Though New Hampshire does not have any explicit barriers against municipal networks, the state has not authorized local governments to bond for them, which has certainly limited local authority to ensure high quality Internet access.

But Hanover is one of several communities around the country that is exploring special assessment districts (sometimes called local improvement districts) that would allow residents and local businesses to opt into an assessment that would finance construction and allow them to pay it off over many years. This approach is well suited to Hanover, which has access to the Fast Roads open access network.

Read the transcript from this episode here.

We want your feedback and suggestions for the show - please e-mail us or leave a comment below.

This show is 18 minutes long and can be played below on this page or via iTunes or via the tool of your choice using this feed.

You can can download this Mp3 file directly from here. Listen to other episodes here or view all episodes in our index.

Thanks to Arne Huseby for the music, licensed using Creative Commons. The song is "Warm Duck Shuffle."

Falmouth Saves With Cape Cod I-Net

Out on Cape Cod, municipal networks are taking hold. Public buildings throughout the town of Falmouth, Massachusetts, experience great connectivity and the town saves $160,000 each year with its own Institutional network (I-Net).

Public Savings

The Falmouth Area Network, maintained by CapeNet, connects 17 buildings throughout the town for a total of $3,000 each month ($2,500 from the school; $500 from the town). Were the town to go through a private provider, it would cost $1,000 for each building every month or $17,000 per month. By saving $14,000 each month, Falmouth's annual savings add up to approximately $160,000 a year. That’s a lot of money to be reinvested in the community of 31,000.

Falmouth Area Network intends to reach even more institutional buildings in the next few years. The 17 that are connected now are the libraries, the schools, the town hall, the police stations, the fire stations, the harbormaster’s office, and a senior center. Soon the Gus Canty Community Center will also gain a connection. At the Annual Town Meeting last week, the town approved the Capital Improvement Plan which included $80,000 to upgrade the network, including hooking up the community center. There are also plans to add a new wastewater treatment plan to the network in 2017.

The Role of OpenCape

The Falmouth Area Network came about thanks to another community-owned network project, the nonprofit OpenCape. Recently featured in an episode of eSTEAMers, OpenCape provides much needed middle mile connectivity throughout the Cape. The middle mile network does not connect business or residential users, but instead focuses on serving as a backbone of connectivity for towns. County, state, and federal grants funded construction of the $40 million OpenCape, which launched in 2013. The Falmouth Area Network connects to OpenCape, and a percentage of the city's annual fees go to OpenCape. 

Falmouth has more buildings connected than any of the other 15 Cape communities. The town’s success in capitalizing on access to OpenCape’s network has inspired other towns, such as Mashpee and Provincetown, to model their own networks after Falmouth.