The community of Rock Falls, Illinois, is well on its way to developing a gigabit municipal network to offer better connectivity to residents, businesses, and public facilities. Last week, the City Council adopted an ordinance that allows the city to issue general obligation bonds to fund citywide fiber-optic Internet infrastructure.

Following Demand

The city’s plan will expand first in business corridors and then use the fiberhood approach in residential areas, building only after a certain percentage of households preregister. The plan divides the city into 14 fiberhoods with each area’s build out cost estimated to be approximately $250,000. Residential fiberhoods will require 45 percent participation prior to construction. Consultants estimate citywide buildout costs will be $13 million; the City Council authorized bonding for that amount. The first bond issue will be $4.1 million likely to happen in early May if approval proceeds as planned.

The City Council authorized the first phase of the project to begin - network design and project administration - which will cost approximately $207,000. The process to issue GO bonds will start in March and city leaders hope to have the backbone completed by the end of June.

Most publicly owned Internet infrastructure is funded by revenue bonds, avoided costs, or interdepartmental loans rather than GO bonds. When funded by general obligation bonds, a project is backed by the credit and taxing power of the issuing jurisdiction and the resource is always publicly owned. Clearly, the community of Rock Falls recognizes how critical the investment is to the community's future.

From The Mayor

In his recent State of the City address, Mayor Bill Wescott focused on three factors that drove the initiative: growth, the city’s strong finances, and local control.

While it’s common knowledge that economic development needs better connectivity than what is now available in Rock Falls, Wescott noted that residents stuck with 10 - 20 Megabits per second (Mbps) download Internet access need and deserve higher capacity connectivity to participate in the modern economy. He defined “growth” broadly, encompassing jobs, education, innovation, public safety, and government.

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When we first learned of the Lookout Lane fiber-optic project in the Kitsap Public Utility District in Washington, we knew we wanted to learn more. Kitsap PUD General Manager Bob Hunter and Telecommunications Superintendent Paul Avis join us for episode 237 of the Community Broadband Bits podcast.

KPUD has historically focused on water and wastewater services but they increasingly hear from residents and businesses that Internet access is a major priority. We talk about their approach and how neighborhoods are able to petition KPUD to build fiber to them. The first area to use this option had very poor Internet access from the incumbent telephone provider.

The discussion covers a lot of interesting ground, from how it is financed to where the demand is heaviest, and why public utility districts should have the option of using a retail model in some areas rather than continuing to be limited solely to wholesale-only by state law. 

For related information, consider our coverage of the Northwest Open Access Network.

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About a year ago, we reported that Rock Falls, Illinois, had decided to develop a fiber network to offer connectivity to local businesses. Now, the town of less than 10,000 is closer to expanding that network to offer Gigabit Internet access and voice to residents.

Considering Expanding Services

In September, community leaders began considering the expansion after consultants suggested investing in Fiber-to-the-Home (FTTH) as the best way to make use of the city’s resources. They offered a “fiberhood” option so Rock Falls Electric Department could connect new subscribers incrementally; they suggest starting with business corridors where many commerical entities are already taking service. The fiberhood approach requires people in specific areas of the city to sign up first, then after a certain percentage of the households committ, construction begins.

Rock Falls began planting fiber and conduit in the 1990s and have connected the municipal electric utility substations, schools, and other municipal facilities. They have also leased out excess capacity to private providers who want to offer connectivity to commercial customers in prior years.

Funding - It's Complicated

The fiber backbone is already in place but a complete citywide FTTH system will cost approximately $13 million, estimate consultants. After consulting bonding professionals, city leaders discovered that they needed to consider a few issues before deciding how to proceed. SaukValley.com reported on the financing discussion:

“We need either a feasibility study or our most recent audit that includes revenues from the broadband business to show we can make our bond payments,” [City Administrator Robin] Blackert said. “But a new feasibility study would cost us between $60,000 and $80,000, and we have no past revenue history with the new utility.”

Blackert said it was previously thought that the new fiber utility could be the primary alternate revenue source, and the electric department, which has been handling the broadband operations to this point, could be...

This is the transcript for episode 232 of the Community Broadband Bits podcast. In this episode, General Manager Josh Byrnes of Osage Municipal Utilities joins the show to share how fiber connectivity has benefited the Iowa community. Listen to this episode here.

Josh Byrnes: Everything is live about it, you can lock in your commodity prices, all your inputs and all those things can be done. We've got to have connectivity, in rural Iowa.

Lisa Gonzalez: Welcome to episode 232 of the Community Broadband Bits podcast from the Institute For Local Self-Reliance. I'm Lisa Gonzalez. In Osage, Iowa, the community's electric utility has served the town and some of the rural areas around it for about 125 years. Osage Municipal Utilities also offers natural gas services and invested in its own communication system in the early 2000s. They offer telephone, cable TV and Internet connectivity via their cable network. Clearly Osage is one of those rural communities that think about the future. In this interview Christopher speaks with Josh Byrnes, the general manager of Osage municipal utilities, who discusses their long term plans to bring Fiber-to-the-Home to the community. Josh who is also a former state representative spends some time discussing Iowa's approach to rural connectivity and its investment in the Iowa communications network. Now here's Chris talking with Josh Byrnes, general manager of the Osage municipal utilities and a former member of the Iowa House of Representatives.

Chris Mitchell: Welcome to another edition of the Community Broadband Bits podcast. I'm Chris Mitchell and today I'm speaking with Josh Byrnes, the general manager of Osage Municipal Utilities in Iowa. Welcome to the show.

Josh Byrnes: Thanks for having me Chris.

Chris Mitchell: I'm excited to talk to you, as I was saying in our pre-interview I actually have this memory and I'm excited to be reminded of the story that you'll be telling us in a few minutes about these cattle prices and an app, around how it's important to have Internet access out on farms near your community. Let's start with a little bit of background for people who aren't familiar with Osage. Where are you in Iowa? What's the community like?

Josh Byrnes:...