In July, the Community Affairs Department of the Federal Reserve Bank of Kansas City released Disconnected: Seven Lessons on Fixing the Digital Divide, a report that touches on Internet access, adoption, and affordability. Overall, this is an insightful primer on the digital divide and how banks can help. 

The CRA and the Digital Divide

Banks have a responsibility to invest in disadvantaged communities under the Community Reinvestment Act. The report broadly outlines the state of high-speed Internet access, including the differences between rural and urban access problems, and explains why the digital divide remains so persistent.

Part of the problem is that our data on Internet access and adoption is woefully lacking. The report includes a section on how FCC data overstates coverage and compares it to the ways Microsoft has attempted to verify actual home Internet connections: 

“The FCC’s data measure availability of broadband while the Microsoft data measure broadband usage. The company shared its analysis with the FCC, which is looking at how it might improve its broadband measurements. While the FCC says 24.7 million Americans lack access to broadband, Microsoft found the actual number was 162.8 million.” (P. 26)

Another related problem that the report identifies is that the technology needed for high-speed Internet access seems to be constantly changing. Companies do not continue to invest consistently in rural or low- and middle- income communities, leaving both with last-generation networks. At the Institute for Local Self-Reliance, we've learned from years of research that fiber connectivity has the ability to meet current and future needs.

Closing the Digital Divide

Expanding high-speed Internet access can expand access to banking. The report notes that:

“Among low-income households, research by the Federal Reserve Bank of Kansas City shows that lacking Internet access has a higher correlation to being unbanked than a variety of other characteristics, including employment status and race.” (P. 11) 

Supporting community networks is one way banks can improve high-speed Internet access, and our research appears throughout the report. One of the example explained...

Local communities continue to search for ways to tackle the digital divide and in San Francisco, the city is making strides by working with a local Internet access company. The City by the Bay and ISP Monkeybrains have adopted a new model to bring high-quality connectivity to residents in public housing. The approach not only creates new opportunities for people who were once denied economic and educational opportunities, but does so in a way that is financially self-sustaining. With modest maintenance and start-up costs, Monkeybrains and San Francisco has found a way to bring the same high-speed Internet access to low-income households at an affordable rate. Read our new report, A Public Housing Digital Inclusion Blueprint: Monkeybrains and San Francisco Deliver a Sustainable Gig, to learn how the partners found a way to shrink the digital divide in public housing facilities.

Download A Public Housing Digital Inclusion Blueprint: Monkeybrains and San Francisco Deliver a Sustainable Gig [pdf], here.

Lessons for More Communities

Every community, regardless of population, must contend with digital inequity. As local communities continue to recognize all residents’ need for high-quality Internet access, models such as the approach developed by Monkeybrains and San Francisco spark further innovation. 

From Christopher:

“These households need Internet access to search for jobs, improve their education, access government services, and for many other reasons common to modern living. Monkeybrains' work in San Francisco shows how smart one time investments in public housing can guarantee high-quality access to all in public housing.”

Erie County, New York, and its county seat of Buffalo have had high-quality Internet access on their minds for several years. Now, County Executive Mark Poloncarz proposes a project to deploy middle mile infrastructure to attract local ISPs and generate competition. We're pleased to see county leadership taking another shot at better connectivity for the people in Erie County, but we hope community leaders will approach the project realistically; in order to bring high-quality Internet access to everyone, the county may need to play a more significant role in the future.

A Lingering Problem, A Possible Solution

Even though it's the county seat, a 2015 report from Erie County's Municipal Broadband Committee noted that the Buffalo Metropolitan Area's peak speeds ranked 294th in the state and that areas existed where there was no option for Internet access of ANY kind. The results horrified elected officials at the time; they issued a Request for Proposals (RFP) to study the feasibility of a county-wide publicly owned broadband network. 

After a survey of residents and businesses, and an assessment of the current situation in Erie County, the final feasibility study recommended several actions, including a middle mile open access network investment. You can review the entire 2017 feasibility study here.

Problems with lackluster and even nonexistent Internet access have lingered in Buffalo and Erie County throughout the past two years. Community leaders have considered the feasibility study and given providers Verizon, Spectrum, AT&T, CenturyLink, and others operating in the region the chance to improve services to the entire county.

Now, County Executive Mark Poloncarz has announced that enough is enough and the digital divide won't narrow unless the public takes control. Taking the recommendation of the 2017 feasibility study to heart, Poloncarz has announced that he'd like Erie County...

Last year, city leaders in Hillsboro, Oregon, decided to pursue a Fiber-to-the-Home (FTTH) network for all premises after studying the possibilities since 2014. Crews have started construction and the city has now introduced the name of its newest utility, HiLight.

Equity Matters

Throughout the process of exploring municipal network possibilities, community leaders in Hillsboro have kept digital equity high on their list of priorities. In order to meet one of their goals — to bring high-quality connectivity to lower income neighborhoods — one of the first areas of the city where HiLight will deploy is in Southwest Hillsboro and the premises around Shute Park. Connectivity rates in these areas are the lowest in Hillsboro, where many residents qualify as lower income.

In order to expedite deployment, the city has decided to start construction in the South Hillsboro area, a section of town where new roads and homes are being built. By taking advantage of the current excavation, the city’s dig once policy will ensure conduit goes in the neighborhood now, which will greatly reduce the cost of deployment. Hillsboro will also install conduit whenever roads are excavated in other areas of town to prepare for future deployment.

By late 2019, HiLight should be connecting residents and businesses to the network. They plan to take an incremental approach to connecting all areas of the city and will strategically consider locations of businesses, busy travel corridors, and schools as they decide where to expand. Hillsboro will invest approximately $4 million toward deployment per year for the next seven years and anticipate subscriber revenue will cover operating costs.

Schools as A Building Block

Earlier this year, Hillsboro and the Hillsboro School District (HSD)...