On May 30th, New Hampshire Governor Chris Sununu signed SB 170, a bill local community leaders had watched for more than a year. The measure will allow municipalities to bond for publicly owned Internet network infrastructure. Advocates, local elected officials, and citizens have been seeking the authority for years. SB 170 may raise some questions as it's implemented, but the bill is significant because it symbolizes this state's decision to expand local authority for broadband investment, rather than limit the power of local communities.

Read the final version of SB 170 here.

A Better Measurement

As we reported more than a year ago, SB 170 sought to make changes in existing law by allowing local communities to bond for Internet infrastructure. The bill sat in committee until last November, when it was amended and picked up again. The final version of SB 170 allows communities to bond for projects that will connect premises that don’t have access to broadband as defined by the FCC — 25 Mbps download and 3 Mbps upload.

On May 8th, voters in Sharon Township, Michigan, will decide whether or not they want to pursue an initiative to invest in a publicly owned fiber optic network. People in the community of less than 2,000 people don’t expect the national ISPs to bring them the connectivity they need, so they will decide if they should take another approach to connect every one with high-quality Internet access.

Like Nearby Lyndon

Sharon Township residents and businesses find themselves in the same type of situation Lyndon Township faced before they decided to take action to develop a network. There is limited wired Internet access in the community, but it’s almost always slow DSL from Frontier or AT&T. Many people must rely on expensive and unreliable satellite for service. Comcast also claims to have a small presence in Sharon Township.

When township supervisor Peter Psarouthakis tried to connect with representatives from incumbents to talk about improving services, he couldn’t reach anyone who could make decisions. Next, community leaders asked smaller companies to serve their areas, but "They told us they have no plans to operate in our township because we don't have enough people, and the return on investment isn't going to be there for them.”

Pressing On

When residents and business owners completed a survey in 2013 as the community considered what route to take, 70 percent of respondents said that their current ISP did not meet their needs; 95 percent expressed an interest in alternative choices for Internet access. Since then, community leaders have hired a consultant to develop a feasibility study and Sharon Broadband Yes, a grassroots group advocating for a fiber network, has formed to educate the public.

Things have been looking up for the Utah Telecommunications Open Infrastructure Agency’s fiber optic network (UTOPIA) in recent years and in December network officials reported they’ve reached a significant financial milestone. For the first time since the open access network began operations in 2003, revenue will cover bond payments and will provide a 2 percent dividend to most of the member communities.

Despite The Limitations

In keeping with state restrictions, UTOPIA can only provide wholesale services via their fiber infrastructure. Ten ISPs offer residential services on the network, which establishes ample competition and all its benefits for subscribers, including lower prices, better customer service, and the ability to switch providers. Businesses can choose from 25 ISPs.

The wholesale-only model, however, significantly reduces the revenue communities can expect from their investment, which was the case with UTOPIA. The eleven member cities bonded approximately $185 million, but revenue limits due to the restriction, some early management decisions, and general apprehension from member communities, created political controversy. At one point, member communities considered selling out to Australian investment firm Macquarie.

Fortitude Paying Off

In 2011, eight of the member communities created the Utopia Infrastructure Agency (UIA) in order to spur more network expansion. UIA collaborates with UTOPIA as a separate entity; its purpose is to deploy the network in more locations and connect more premises and has issued the dividend to its member communities.

On August 1, 2017, the Franklin County Infrastructure Bank awarded Grove City, Ohio a $2 million loan to support their construction of a municipal fiber optic network. 

The Grove City Plan

According to the city’s Request for Proposal (RFP), the city is focused on first establishing an institutional network (I-Net) and plan to expand it to serve local businesses over time. The initial fiber optic network will connect Grove City to the South-Western City Schools, the townships of Jackson, Prairie, Pleasant, and the Solid Waste Authority of Central Ohio (SWACO). The goal is to create a network with a baseline of ten gigabits symmetric service, ten times the speed of current connections provided by Spectrum (formerly Time Warner Cable).

According to Mayor Richard “Ike” Stage, the increase in network speed will attract businesses and will generate a 100 new jobs for the city. Josh Roth, Senior Program Coordinator for Economic Development and Planning, has said “that Grove City has committed to one hundred jobs over the next three years.”

During the August 1, 2017 general session, the Franklin County Board of Commissioners  passed the resolution to authorize the loan to the city of Grove City. 

Franklin County Commissioner Kevin L. Boyce celebrated the project:

“[T]he fiber optics really makes a difference because companies will look at whether to expand or move there [Grove City]. It could be a deciding factor. Those are jobs that are retained that you may not see."

In a record high turnout for a non-general election, voters in Lyndon Township, Michigan, decided to approve a bond proposal to fund a publicly owned Fiber-to-the-Home (FTTH) network. The measure passed with 66 percent of voters (622 votes) choosing yes and 34 percent (321 votes) voting no.

Geographically Close, Technologically Distant

The community is located only 20 minutes away from Ann Arbor, home to the University of Michigan and the sixth largest city in the state, but many of the Township’s residents must rely on satellite for Internet access. Residents and business owners complain about slow service, data caps, and the fact that they must pay high rates for inadequate Internet service. Residents avoid software updates from home and typically travel to the library in nearby Chelsea to work in the evening or to complete school homework assignments.

Lyndon Township Supervisor Marc Keezer has reached out to ISPs and asked them to invest in the community, but none consider it a worthwhile investment. Approximately 80 percent of the community has no access to FCC-defined broadband speeds of 25 Megabits per second (Mbps) download and 3 Mbps upload.

“We don’t particularly want to build a network in our township. We would rather it be privatized and be like everybody else,” Keezer said. “But that’s not a reality for us here.”

When local officials unanimously approved feasibility study funding about a year ago, citizens attending the meeting responded to their vote with applause. 

A Little From Locals Goes A Long Way

If you’re a regular reader at MuniNetworks.org, listen to our podcasts, or if you simply follow publicly owned network news, you know an increasing number of communities have decided to invest in local connectivity solutions in recent years. We’ve watched the number of “pins” on our community network map multiply steadily, but every now and then, a network drops off through privatization.

FastRoads Sold To N.H. Optical Systems

New Hampshire FastRoads received America Recovery and Reinvestment Act (ARRA), which combined with state funding, created the open access fiber optic network in the southwest section of the state. Over the next several years, the network expanded with private donations and local matching funds. Many of the premises that connected to the network had relied on dial-up before FastRoads came to town. But in part because state law makes bonding for network expansion difficult, Fast Roads will no longer be locally controlled.

The Monadnock Economic Development Corporation (MEDC), a nonprofit organization whose purpose is working to see like projects are completed that will improve economic development prospects in the region managed the project. MEDC contracted with another entity to maintain the network, which cost approximately $15,000 per month. Since they had achieved their core goal - the construction and launch of the network - MEDC had been looking for another entity to take over the network or to partner with them. They recently finalized a deal to sell the network to New Hampshire Optical Systems. 

In August, voters in Lyndon Township, Michigan, will decide whether or not they want to approve a plan to invest in publicly owned fiber optic Internet infrastructure.

It’s All In The Mills

Voters are being asked to approve a millage increase of 2.9 over a 20-year period. In other words, property taxes will increase approximately $2.91 per $1,000 of taxable value of a property. Those funds will be used to fund a bond to finance the project; city leaders have already determined that the principal amount of the project will not exceed $7 million.

Once the infrastructure has been completed, the community plans to partner with one or more Internet Service Provider (ISP). Estimates for monthly millage bond costs and monthly cost for Internet access at 100 Megabits per second (Mbps) are approximately $57 for Lyndon Township’s average homeowner. Gigabit access will be available and will cost about $25 more each month.

If funding is approved, the community expects to finish the project and be using their new Internet infrastructure by the end of 2018.

Supported By Citizens

The issue of better connectivity in Lyndon Township isn’t a new one. At a meeting in March 2016, Township Board members voted 5-0 to fund a feasibility study. The Board had approached providers about improving connectivity in the area, but none considered an investment in Lyndon Township a good investment. 

At the meeting, members of a broadband initiative started by local residents shared their stories. As is often the case, local residents described driving to the library or Township Hall to access the Internet because their own homes were unserved or connectivity is so poor. According to a Chelsea Update article, when the Board approved the feasibility funding, “[t]here was a vigorous round of applause from the crowd.”

Prince George County, Virginia, and its electric cooperative recently entered into an agreement that will allow Prince George Electric Cooperative (PGEC) to offer Fiber-to-the-Home (FTTH) to certain areas in the county. The arrangement came after a successful pilot project that proved residents and businesses in the rural community were interested in better connectivity. The agreement will inject funding into the cooperative's plans to bring high-quality connectivity to all its members.

From Rural Pilot To Proven

In February, officials from PGEC reported to the County Board of Supervisors that the pilot project was under way. The Virginia State Corporation Commission approved the cooperative's formation of its PGEC Enterprises subsidiary, which will offer connectivity to members. The co-op has connected premises along one stretch of Quaker Road in Prince George County, and received applications for installation from more than 40 property owners.

By the time PGEC had finished deploying in the pilot area in early May, a total of 49 premises were connected to the network. According to the co-op’s VP, Casey Logan, that figure represents approximately two-thirds of potential subscribers. 

Jumpstarting Co-op Broadband

The performance agreement between Prince George County, PGEC, and the Industrial Development Authority (IDA) will provide $1 million to the cooperative in IDA bond funding to expand the pilot project to a wider network. The funds are part of spring bonding that covers a number of county projects. The County Board voted unanimously to dedicate the funds to the broadband expansion project.

In addition to connecting all its substations, PGEC will connect any residence, business, community anchor institution, or public facility within 1,000 feet of a state road along the fiber route. Approximately 500 premises are located within the planned fiber route. The project should take about four years to complete.

Even though they don't have to chip in any local funds, the town of Shutesbury, Massachusetts, rejected Charter’s proposal to build a hybrid fiber coaxial network in their community. They don’t consider the proposal a “good long-term solution to bring broadband to our town" and prefer to build a publicly owned fiber-optic network for future-proof technology, provider accountability, and local control.

You Get What You Pay For

Unlike Charter’s proposal to serve only 96 percent of the homes in the community, the town made a commitment to include all members of the community some time ago. Charter would not extend its proposal to include about three dozen properties that are further out unless the town committed to providing funds above and beyond what the state offered to provide as part of the proposal. Board of Selectmen Chair Michael Vinskey went on to tell MassLive that Charter would not commit to a specific cost for extending a network to those additional homes.

In the words of Vinskey, committing to such an ambiguous arrangement, “would not be fiscally responsible.” No kidding.

Shutesbury authorized spending for a Fiber-to-the-Home (FTTH) network once already. In 2015, folks at the annual Town Meeting voted to approve $1.7 million in bonding to pay for the infrastructure. They’ll take another vote this May for the debt exclusion authorization, as required by state law.

Community leaders estimate deployment to every property at approximately $2.57 million. Their share of the state grants that are to be distributed by MBI come to $870,000 for construction and professional services. Like the community of Leverett, Shutesbury intends to use a modest property tax increase to fund the infrastructure investment.