Fast, affordable Internet access for all.
Mason PUD 3 is Snaking Its Way Through the Unserved and Underserved Parts of Washington State - Episode 560 of the Community Broadband Bits Podcast
This week on the podcast, Christopher is joined by Justin Holzgrove, Director of Engineering & Utility Services, and Mike Rientjes, Telecommunications Manager, both from Mason County Public Utility District 3 in Washington State. The PUD provides electric service to more than 35,000 households across an area the size of Rhode Island, and began connecting its grid infrastructure to fiber in the late 1990s. Since 2003, it has operated an open access ftth network for households; an endeavor that has sped up since 2015, when residents began clamoring for more.
Justin and Mike join to talk about how the PUD's efforts have been aided because of the fiberhood model they're using. Once enough households in a region register interest, the PUD's trucks roll into town. Interested homeowners then join those fiberhoods and pay a $25/month construction adder for a period of 12 years - no matter how long a drop their home requires.
The result? Strong word of mouth and indirect marketing have meant some of the highest take rates we've seen on community-owned networks, with an average of 80% across Mason PUD 3's existing service territory, and 100% in some areas. Demand is so strong that the PUD has been working overtime to keep up and deal with supply chain shortages on things like vaults to keep up with the demand.
Watch the video below for more on the history of PUD 3, and the one below that for how the PUD's fiberhood approach works.
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Thanks to Arne Huseby for the music. The song is Warm Duck Shuffle and is licensed under a Creative Commons Attribution (3.0) license.
Justin Holzgrove (00:07):
Bad Internet is worse than no Internet because it gives you that hope that you will be able to connect. And we're taking folks from bad Internet to the best you can find. So it really is a, a game changer.
Christopher Mitchell (00:20):
Welcome to another episode of the Community Broadband Bits podcast. I'm Christopher Mitchell at the Institute for Local Self-Reliance in St. Paul, Minnesota, and today I'm talking with Justin Holzgrove, the Director of Engineering and Utility Services at Mason Public Utility District number three. Welcome to the show, Justin.
Justin Holzgrove (00:41):
Hello. Thanks for having us.
Christopher Mitchell (00:43):
Great to have you back. It's your third time around. And we have a first time guest as well, Mike Rientjes, who is the Mason, p u d number three, telecommunications manager. Welcome to the show.
Mike Rientjes (00:54):
Thank you very much. Glad to be here.
Christopher Mitchell (00:56):
Justin, I think that was your old job, is that right? And you got promoted since we talked last.
Justin Holzgrove (01:00):
That's right. But Mike is filling the shoes better than I ever could have done the job, so we're actually in a better place now with Mike in that place, so
Christopher Mitchell (01:08):
That's terrific. So we have talked as we mentioned, we talked about previously how Mason PUD three got started. Some of the background, you do electricity, there was smart grid type stuff and use service zones. We did an entire show talking about service zones from cos or c o s depending on how you wanna pronounce it. And so people can check on that. But let's jump in, Mike, with the quick refresher of, of how and why P number three is doing broadband services.
Mike Rientjes (01:41):
You know, we're, we're doing broadband services. We, we've started about 23 years ago now, you know, and at first it was to bring broadband out and deploy it to our facilities, our substations, our grid, and we had an excess capacity model where we brought fiber to the home. And that's expanded year after year seeking grants as well. That's helped us extend our distribution network to serve many, many residents here in Mason County. And we're continuing to fulfill that need to those who are unserved or underserved.
Christopher Mitchell (02:13):
So, and you're doing it Justin, with an interesting model that I feel like you kind of pioneered. There's probably someone out there who's saying, oh, someone, oh, I did it first, but but it's something that we didn't run into a whole lot a construction adder to help pay for the infrastructure. So can you walk us through how that came about?
Justin Holzgrove (02:32):
It was a team effort here, and, and you're right, we kind of dreamed it up ourselves. If anybody would know about a model that was similar to it, I would look at you, Chris, and and if you've heard of one, so if you've haven't heard of one that I'm gonna stick with it. <Laugh> we've heard the, the name Fiber Hood from a Google Fiber pilot project early so we didn't come up with that name, but Google didn't trademark it. So we're using it to expand broadband to the unserved and underserved here. It essentially works in a similar rate model as the electric utility which is a melded rate philosophy. It's the idea that the customer's electric service that is right outside the substation is much cheaper to s serve and provide than the, the person at the end of the line, but yet they all pay the same electric rate.
And the, in the fiber hood model, it's very similar. When we identify a zone and when a zone reaches a 75% commitment level, that's when we move it to the construction list. We build the zone, but in order to connect to the fiber that the PUD builds, it's a flat application fee, $250 app fee, and then a $25 per month construction adder on top of what the retail service provider charges to the customer. And that is the same cost. Whether you have a driveway that's a thousand feet underground, or a a 50 foot service drop from, you know, overhead from the road. One is much more expensive to build than the other, but it's a melded rate philosophy. Everybody's paying that same construction adder. We did a whole podcast several years ago about that fiber hood model. Nothing's changed in how it's operated. Or how it is, is formatted. It only lasts for 12 years, it expires after that. And then you don't have to pay that construction adder. If you join in year three, for example, you only pay the remaining nine years of construction adder. If you leave after five years, move out of the area or whatnot, you no longer pay the rest of that.
Christopher Mitchell (04:35):
And is that per zone? So that's,
Justin Holzgrove (04:36):
That's how it works? Yes, that's right. It's per zone. Yeah. That's when the clock starts, when we can connect the first customer in the zone.
Christopher Mitchell (04:43):
So you have some zones that are presumably more than half done or pretty close to that?
Justin Holzgrove (04:48):
Oh, certainly. So one of the, the critical pieces for the success of the program is that we are only building in areas that are unserved or, or really underserved. And so we're not building to other areas that have solid coax cable plant networks or fiber to the home Networks already existing. They're already being taken care of. Mesa County has a lot of areas that don't have any service or have really poor dsl. And so we're focusing on those. What we have found is when we come in and build the fiber hood we are hitting incredible take rates right off the bat. 80% or so is kind of what our sort of average take rate is on existing fiberhoods right now that have been up and running for about a year or so. We hit that 60% take rate really quickly kind of on the initial, Hey, everybody, you've seen the construction neighborhoods built, it's time to apply to get connected. You know, we hit 60% right away, and then it, it doesn't take long, just another year or so to get from 60 to 80%. And some of 'em are actually a hundred percent connected. So really excited about the program, but I think the key is that we're focusing on the unserved and underserved areas.
Christopher Mitchell (05:58):
Yes. And we didn't mention it, but Mason P is p D three is on the Olympic Peninsula. It is enormous by the standards of most of the rest of the country in terms of land mass very large county but has some pockets of density but a ton of forest land. Mike, is there anything you'd add to that in terms of helping people understand what it's like out there?
Mike Rientjes (06:23):
Yeah, we have definitely rural areas and we are building to those that, you know, it's just not profitable for private sector companies to build to. And, and we're really trying to answer that call, answer that challenge and get to those people and serve them, you know, they're, there are customers on the electric side, you know, as far as we provide services to them. So we, we definitely hear the call and, and the need to, to get to the most remote places and come up with a great program, like a fiber hood program to make it to make the numbers work, to, to expand those services in those tough reach areas.
Justin Holzgrove (06:56):
So I have a fun fact about the size of Mesa County. You mentioned it's such a large area our service territory is approximately the size of the state of Rhode Island.
Christopher Mitchell (07:05):
That's enormous. Huge. Yes. And you have how many people there?
Justin Holzgrove (07:09):
We have 35,000 electric meters, but there are about 70 to 80,000 residents in Mason County.
Christopher Mitchell (07:16):
Now Mike, you set the service zones boundaries. Do you have areas then where there are people living who have no Internet service, who don't have a service zone defined yet? Probably because of cost or other issues of getting out there?
Mike Rientjes (07:32):
Yes. and, and those will be forthcoming as well. Our service zone are set up right now with where we have distribution facilities where we can easily reach those areas and then to build a network within that community. Eventually, you know, with, with planning and design we're putting into it, we want to build to all of Mason County over time. You know, or at least have the infrastructure in place to be able to serve them. But right now, defining those zones is key. So we are leveraging the assets that we already have seeking grant dollars of course, to extend those middle mile resources to reach those areas, but being very strategic in how we cultivate those, those fiber hood zones for now. But like I said, with the eventuality that we want to hit all over time or have a network that's capable of that,
Justin Holzgrove (08:17):
One of the things that we had talked about in previous episodes was the term of disappointment. And that was exciting of a base and then disappointing them that we either couldn't build to them or it was gonna be a very long time to get, you know, to get them actually constructed. And so we really have prioritized our list of unserved and underserved communities to areas that we can feasibly and technic technically and reasonably build to within a, within a timeframe that, that we can all see and we can touch and we can work towards. And as the network expands, as Mike said, we add more zones continually. So just cuz you're not in a service zone now, doesn't mean you're never gonna be in a service zone. It means you'll be in a one
Christopher Mitchell (08:59):
Later. Right. And we are previously on episodes 2 74 and three 16 for people who wanna check it out. That was a time when I felt really like we've been doing this show for a while and now it's been we have twice as many episodes. It's wild <laugh>. The state of Washington recently returned authority to PUDs to decide if they'd like to pursue retail service themselves. Most PUDs are not doing that. In fact, I think there's only one that is doing it and another one that might. But you're firmly in the open access camp still, right?
Justin Holzgrove (09:33):
Absolutely. Yeah. We believe that our network will always remain open access. We think that's best for the consumer best for the retail service providers that have a, have a, a source of income. You know, it's, it's great. We have some service providers who own their own plant and, and run and operate their own networks as well, but we also service providers that only provide service on PUD networks. And so it works for all, all players.
Christopher Mitchell (09:58):
Right. And I think in that the second episode, three 16, I think it was, we talked about some of the niche business models and I think that's one of the coolest things about open access, but there's several other things we want to talk about. So Mike, I want to ask you about grants. The state of Washington has also been generous with grants. And so how has that gone in terms of pursuing grants for your public utility district?
Mike Rientjes (10:21):
Yeah, you know, we are currently just closing out our our curb grant. We had first round of curb grant that expanded service to the southwest portion of our county. Some area on Stein kind of spread throughout the county, the southwest corner, the north corner and Teya. And that one's just wrapping up now. We have a second curb grant that we're working on through the end of this year which picks up off of more communities, more pockets, scattered equally throughout the, throughout the county, working on an r u s grant as well for a pocket area in great view underground construction that's to be completed by 2026. Lots of lots of work involved in that one with 100% underground for the most part, which is the most difficult type of work to extend services.
And then we recently just were awarded Washington State Broadband office grant for our co Callum communities, which is about 680 customers overhead, primarily through the middle of our county. So so that's what we're working with now. We're seeking these grant opportunities to build that middle mile out and then to get to the end users in these and, and just trying to leverage our existing network infrastructure as well, and to make best use of those to hit these areas. You know, we've, we have comprehensive data about the inquiries we take in, you know, people who need service and we, we leverage that data and in seeking these grants and where the density is and where people are screaming for the most and don't have opportunity.
Christopher Mitchell (11:59):
Now, a thought popped in my head as you were describing that, and I know that your area is, well, at least I know that a lot of the Olympics are considered rainforests. Do you face significant fire, Dan, danger out there as well?
Mike Rientjes (12:11):
You know, there, there are, over the last few years not, not like Eastern Washington, but over the last few years we have seen some more fire issues. The, the utilities took an aggressive measure on our fire prevention program, which is great on the electric side, but like every utility these days prevention is, is key. And, and making sure that, you know going forward, we have plans in place and our infrastructure is built to the best standards possible. That is something that we're actively considering. And, and, you know, looking at fiber network, also levered is able to be leveraged in remote disconnect devices, which will be a benefit to that fire prevention as well. If a line goes down, having a, a future device that they can open up without having to mobilize out there for, for our SCADA system is a benefit. And that's kind of where our vision is focused in preparing for that.
Christopher Mitchell (13:02):
Yeah, I learned from Douglass electric cooperative in, in below you in Oregon that being underground doesn't protect you from the, the worst fires, but it seems like it's gotta help somewhat depending on the various things that you face. So I assume it's one of those things that you're looking at the cost of going underground on these long lengths and, and it's horrifying, but it's gotta be at least helpful knowing that it'll be very rare they'll ever have any problem. Most of those areas are not where you're gonna have the old fiber seeking backhoe problem, probably.
Mike Rientjes (13:32):
Yeah. you know, primarily where we're driven to go underground, where we're looking at our existing utilities is where our primary cable we, we have a dig once policy, right? So if we're looking to expand our fiber, we ensure our electrical facilities are right there with it, whether it's underground or overhead. We're, we're digging once where we have to dig, we're placing future electrical conduit in facilities at our expense outside the grant, just to ensure that we're digging, digging once and making the best use of those resources while they're in the field.
Christopher Mitchell (14:03):
So, and we're gonna talk in a, in a minute about supply chain challenges, which I'm sure you hit on the electric side as well as on the the fiber side as your, or I should say on the telecom side, because fiber is used for both the electric and the telecom side. But I'm curious, before we talk about supply chains, if we can finish up on the, the telecom services. Have you had any like great success stories or people you know widows and orphans being having their lives changed, you know, <laugh> the kinds of enthusiastic stories that help people understand why this is a valuable work?
Justin Holzgrove (14:38):
You know, I personally have been a little bit disconnected to the individual stories lately. Mike maybe has some but I do know that we're not building to places that adequate broadband before. They're going from zero to a hundred, zero to a thousand, you know, to use our numbers correctly. And it's, it's life-changing. It really is life-changing for homes for the way that our community runs. You know, Maye County has 73%, I think is the number of home-based workers that live outside of, in, live, outside of the city centers in the rural areas. And that's gotta be really helpful to be able to work from home to be able to take care of, you know, all, all of the basic necessities. I often joke with friends that bad Internet is worse than no Internet, because it gives you that hope that you will be able to connect, and we're taking folks from bad Internet to the best you can find. So it really is a, a game changer.
Christopher Mitchell (15:42):
Yeah, I've spoken with Melvin John from the Ho Tribe and they were early on starlink, and it was clear that they loved it and it was great, but also they have the canopy to deal with not in like Western Arizona, where there's a broad, wide open sky. And so they I know that that's a challenge probably for a lot of your customers where they, they may not be able to take advantage of even low earth orbit satellite breakthroughs that have helped some people out.
Justin Holzgrove (16:08):
Right. We have heard some success stories of starlink. One of our team members here uses starlink to be able to work remotely from occasion. So we know that it is possible, but you know, nothing beats a fiber connection directly to the home.
Christopher Mitchell (16:23):
Yeah, absolutely. Mike, are there any stories that are fresh in your head of local businesses or residents?
Mike Rientjes (16:28):
No, no stories specifically just emails that, that come in thanking us so much for, for connecting them. You know, we, we hear this, the, the desperation, you know, when we get the inquiries that come in, and then to see something fulfilled on the backside and to see a thank you note come through, it's just those ones and twos that, that come in. But, but thank you so much. My, my child's able to attend school online or able to download a lesson without having to drive somewhere to, to get that, that, that's really that what what makes it worthwhile for us, you know, is, is, is just seeing those emails come through and, and then, you know, understanding it's heartfelt. It really is.
Christopher Mitchell (17:07):
Yeah. That's excellent. So let's talk about some of the challenges that you've then faced more recently with supply chain challenges. I understand that that falls on your face, Mike <laugh>.
Mike Rientjes (17:17):
Yeah, you know, over this last couple years especially we've seen supply chain shortages for all types of components from the fiber optic cable itself, the distribution terminals, line hardware, P V C products like conduit faults, pedestals, and it really forced us to kind of look outside the box to find alternative vendors who are not only producing those products, but who could get them to us in a timely manner to continue on with the construction schedule that, that we're maintaining right now. We looked at, we found one resources right across the street from us, which was awesome. Fiberglass manufacturing facility create some fiber vaults for us, which turned out to be really nice. Just kind of a painstaking process going through, looking at all the parts and processes, because there's always a downstream effect whenever you change out a part or have an alternate part come through, there's a downstream effect for all the attachment hardware that's associated, all the other parts and pieces that go along with it. So trying to match that up from cable diameter specifications to glass specifications to, you know, made up with our existing infrastructure. It's, it was challenging, but worthwhile to bring on these alternate items and see success in getting lead times shortened that way as well, and still maintaining a network that that can fully function and and, and serve as needed. So
Christopher Mitchell (18:42):
Let's talk about the fiber vaults for a second. So what does that entail? I mean are there open access designs on the Internet where you can sort of take them a, a CAD file and they can figure it out? Or is it, is it a lot of work for them to figure out how to manufacture it to make sure it works with all of the, the attachments you have that, that are expecting? I don't, I don't even have a sense exactly of what might be involved, but I assume that it's not just a box <laugh>.
Mike Rientjes (19:07):
Yeah, you know, for you know, there, there's H D P E vaults, there's P V C and concrete is specifically what, what's out there. We order, we borrow from the electric side here and there, looking at some of the concrete vaults if and when needed, but it's nothing that we could like take to a manufacturer and have them produce. It's kind of finding what's already out there and where it is, and then adapting hardware to match up with that. So a couple of examples would be just getting a vault that's similar in size that meets the bin radius for the cable can be set with trucks and equipment that we already use. The dig out spec is similar to what we have for when customers perform any type of rest or trenching in restoration but then also the bracketry that holds the terminals.
We have a local machine shop who creates brackets and we had to go back and forth a couple times on more of a universal type bracket and just making sure that our terminals can mount inside those vaults that we have the hardware we need, and that the cable penetration points come in at the right spaces so we can go in and outta those vaults. The other thing is making sure they're identifiable. So a uniform tagging system that adheres to all those types of materials, whether it be concrete or PVC for, for our labeling and, and mapping standards. Yeah, it was, it's it's been a challenge, but we have a great team and, and we found a lot of great products that they work for us, and that'll serve going forward as well. Having those alternates
Christopher Mitchell (20:34):
And all of those are delays and challenges while you're trying to meet your schedule. Right. It's not like when you, when you set up your construction timelines and your pipeline that you thought, oh, we'll just need a lot of extra time to like go back and forth in the machinists.
Mike Rientjes (20:47):
Exactly. You know, and we, we have, we budgeted projects off of our traditional standards that we had on, and we've all seen the prices of goods go up here lately as well. So trying to match that, finding something that's comparable yet fits within the budget as well. And, and it will work for our application and just multiply that on you. Even the smallest components in some cases pull attachment hardware you know, there's only so many man manufacturers out there and finding something that meets your specifications and making sure that it, it will fit with the other components that actually fit in the assembly. Overall, that's been some of the most challenging resources. But I'm happy to say that, you know, we completed our curb one deadline on time actually in spite of those delays and setbacks. So that, that's a real win for us for sure. But we definitely are, you know, focused on making our goals, making our commitments in light of these challenges and doing absolutely the best we can to, to make that happen.
Christopher Mitchell (21:44):
There's and I'll come to you Justin for this. I, I'm curious, there's discussion about this being a once in a generation funding. I've tried to avoid that discussion cuz I know that there's gonna be a great need both in I think urban areas as well as we'll still have more need in some rural areas when all this money is spent. But when you look at the amount of money that the Washington Broadband office will be distributing do you have a sense of whether you could say, you know, you have to predict what share of it you may be eligible for and able to get, but would you say it is likely possible or not likely that you would be able to meet the vast majority of the rural need when that money comes through?
Justin Holzgrove (22:31):
It's a great question and really is the billion dollar question perhaps you know, multi-billion dollar question. And you know, Mason PD three is a local government and we're, we're audited. We follow all the rules, we make sure that we are only committing to what we can complete. And, and we're fully engaged in this process. So we're all in and we're all in the right way. I think that we, in that mindset, we have a challenge because we're only gonna say that we want the money for what we know we can accomplish,
Christopher Mitchell (23:11):
Right? I think if this is the hamster in the snake, which people always cringe at, like, there's only a certain amount you can digest at any given time.
Justin Holzgrove (23:18):
Exactly right. And, and we're not gonna, we're not gonna bite off more than we can chew, but we, we definitely need to be fully engaged in this, in this whole thing. And I am concerned that there are companies who have been, I, gosh, I, I don't know how to say this delicately, but playing the telecom money game for a lot longer than we have. And, you know, they, they take as much as they can and they make it work for whatever works within their business model. That's not how Mason PUD three operates. You know, we, we establish a plan, we try to fund the plan, and then we build the plan and then we start again to do the rest. We're, we're gonna be around for a long time. We're building infrastructure that lasts nobody's cutting corners around here, and we're making sure that we're providing the best and the most reliable.
How do we do that with the large goal of connecting everybody in Mason County as soon as possible? I don't know that we have the answer for that yet. I know that we can build you know, the areas that are unserved and underserved, we've identified those. We're ready to make our application when the no flow is released. And, and when it's when more details emerge, we're gonna be fully engaged. But it's a little bit of a mind shift a mindset shift for us. And, and we're trying to make sure that we're, we have all of our, all of our ts crossing our i's dotted in that a lot of money has gone out for calf calf two you know, we're funding ten one, you know, there's a lot of money that was spent on that and we haven't really seen it solve actual problems at the home. And we don't wanna, we certainly don't wanna be, and we will not be involved with receiving funding and then underperforming,
Christopher Mitchell (24:56):
There's strict timelines and there's very realistic challenges that come to having to build a system like this in the environment you are. And, and on top of that, I mean, I don't know, I haven't looked at the full analyses, but my experience with Washington State suggests that that money will not solve a hundred percent of the unserved needs in Washington, no matter how it is spent.
Justin Holzgrove (25:14):
Yeah, I would agree.
Christopher Mitchell (25:16):
Mike, is there anything you'd add onto that? Just to give a perspective on it?
Mike Rientjes (25:19):
You know, like Justin was saying, the money that's out there, there, there's been money out there for years. We're seeing a, a large influx now and you know, utilities like us going forward with our plans and our approaches, the way they're defined are really seeing results. And that's what I'm encouraged to see. We've seen this, we're, we're replicating the model. We have areas to find that need, the service, we have the backing of the customers out there that we already have on the electrical side, say they need the service, we have a plan. It's just staggering out the amount, you know, that we get. So we can confidently meet these commitments on time and on budget. We, we hope this continues for a while to, to fund the system, just not in the short term, but, you know, in the years to come. So we can be right there with it and, and continue on. Cuz that's, that's what we need to do.
Christopher Mitchell (26:05):
Thank you so much Mike and Justin really appreciate the time and I'm hoping, I mean, I'm, I'm hoping to get out sometime in the next year or two with my family to do some hiking in the Olympics and the Cascades. So maybe I'll be giving you a little, a little ring that I'm coming through town. But until then thank you so much.
Justin Holzgrove (26:22):
Yeah, of course. Look us up. Stop by. We'd love to take you on boots on the ground tour of a fiber hood.
Ry Marcattilio (26:27):
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