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Transcript: Community Broadband Bits Episode 151
Thanks to Jeff Hoel for providing the transcript for the episode 151 of the Community Broadband [no-glossary]Bit[/no-glossary]s podcast with Doug Hammer and Krista Allen on what reporting requirements mean for smaller ISPs. Listen to this episode here.
Doug Hammer: What is getting tedious is the compounding of new and additional reporting requirements. And, again, because we're a multiple provider, not only do we see all of us spending an inordinate amount of time on telecom, but we also are seeing the reporting for electric, gas, and water go up.
Lisa Gonzalez: Hello, and welcome to the Community Broadband Bits Podcast, from the Institute for Local Self-Reliance. This is Lisa Gonzalez.
In this interview, Chris talks with Doug Hammer, Director of Marketing from Harlan Municipal Utilities, and Krista Allen, who is the Director of Finance and Customer Service. They help us learn more about why the reporting requirements are a very different thing for a small municipal utility than they are for giants like Comcast or AT&T, especially when the municipal utility also manages electric, gas, or another essential service.
Now, here's Chris, speaking with Doug and Krista, from Harlan Municipal Utilities.
Chris Mitchell: Welcome to another edition of the Community Broadband Bits Podcast. I'm Chris Mitchell. And today I'm talking with Doug Hammer, Director of Marketing for Harlan Municipal Utilities in Iowa. Welcome to the show.
Doug Hammer: Good morning and thank you.
Chris: And we also have Krista Allen, the Director of Finance and Customer Service for the Harlan Utilities. Welcome to the show.
Krista Allen: Thank you.
Chris: So, I think we should start by noting that we ran into each other at the always excellent Iowa Association of Municipal Utilities Conference -- the broadband conference in Des Moines that happens -- usually it's around March. I like to think of it as spring, but usually it's more wintry. And I've actually not been to Harlan. So, can you tell me a little bit about it?
Doug: Well, let's see. Harlan is located in west central Iowa. We're a typical small town, rural Iowa community, very agriculture based. Population is about 5,200 people. We provide electric, gas, water, and telecommunications to the city. And under telecommunications, we provide cable television, Internet, and voice services.
Chris: And how did you decide to get into telecommunications?
Doug: This would have been about 1995. HMU was actually one of the first municipal providers in the state after the laws in Iowa changed. And HMU was also one of the first people that launched the new-for-that-time DOCSIS 1.0 Internet services.
Chris: Wow! [laughs]
Doug: And the vote was passed in 1995. And I believe television and Internet services were up and running by 1996. We added voice services in 2001. So, we were very much an early adopter. And we used a hybrid fiber coax infrastructure, which at that time was fairly unique. We also had a fiber MAN network, too. We were probably one of the first in the country to start using that type of an architecture, and one of the first small towns to start to invest in a fiber, even at that point.
Chris: Well, and not only that, but you're also -- I mean, you're right at the threshold. You have about 2,200 premises. I was looking on Wikipedia. Or at least you do now. I don't know how many you had then. But that's -- it's very difficult to make the triple play work -- particularly the cable model. So you kind of pushed the boundaries in multiple ways.
Doug: We have. And, by way of background, if they say competition is good, then Harlan is great. Because we actually have three cable television providers serving 5,200 people. Plus satellite service. We have four Internet providers. And we have four telephone companies in this town. Most towns probably have one -- maybe two -- providers of each one of those services. We have up to four providers in this town.
Chris: Yeah. I don't remember if it was Decorah or Ames. But there's an Iowa town that's reliably chosen the most literate town in America. And I'm guessing they don't have four television providers there.
Doug: Probably not. Like I say, it's a little unique for this market. Mediacom -- at the time, it was actually a smaller provider that got absorbed into AT&T. And then the Iowa markets were spun off to Mediacom. I believe about 2000 or 2001 is when Mediacom purchased all of the Iowa properties. So they were the incumbent. We have had a telco move in. And, of course, you've seen the rise of Dish and DIRECTV the other satellite providers.
Chris: And so, what's been the impact on the community of the municipal's utility services?
Doug: I would say that early on, because we had a lot of good support from the institutional organizations in town. The hospital was probably one of the first that was able to start to use telemedicine at that time. And, of course, the impact on the school districts that we were able to provide at that time -- and, again, it's all relative -- a high-speed Internet access. I would say the generation that has grown up in Harlan since 1995 has known nothing but broadband in this town. I don't ever recall there ever being a reliable dial-up provider. And our speeds, amongst all of us, have always been very competitive. It's always been a very competitive broadband market. So, like I said, we have a whole generation of kids that have always grown up with broadband here. They're used to a faster speed. We were able to do -- with the MAN network, we were able to help the county move data a little bit more efficiently between the main courthouse here in town and some of their satellite offices within and around the town. We had some other early people that were sharing, at that time, a mainframe. And they had, of course, high-speed Internet access to the world, and then in between the buildings too. So, we've always been pretty much ahead of the curve when it comes to advanced business services and government integration of transfer data and sharing. We are part of the Iowa Communications Network. We were an early provider of them, giving connections to the schools and the libraries in town.
So, from the very beginning -- again, 1995 -- we have been very well-connected to the world, in ways that other towns are just now starting to experience.
Chris: And it seems like we've saved some of the hardest questions for Krista. When we were talking in Des Moines, one of the things that I really wanted to ask you about is what it's like being such a small provider, with a small staff, and having to deal with all the paperwork, the forms you have to fill out from the FCC, and that sort of thing. And so, now, I'm curious, Krista, if you can give us an overview of what sort of obligations you have as a utility. I guess we'll just start with an overview of it.
Krista: Sure. Absolutely. We do spend a large amount of our time on the different reporting for FCC. There's forms that are due on a quarterly basis, several that are due on kind of a semiannual or annual basis. And we are fortunate enough to have an ability in software that allows to get a lot of the information that we need for these reports from there. But it is time-consuming to try to get into those reports and make sure the data is accurate, and to complete those forms for the FCC, and get those uploaded and sent off.
Some of them that are changing right now are like the Form 497, the Form 477. Those two do take a lot of time. We are fortunate to have a third party who does assist us with a lot of the reporting regulations. So it kind of helps keep us on our toes, and help us meet those deadlines. Also keeps us abreast of anything that's changing, moving forward. And helps us prepare for those changes in a timely fashion, so that we can still continue to meet those deadlines.
Chris: When it comes to all this paperwork, do the big providers have to do more paperwork than you? Or do they have to do the same amount? I mean, I guess I'm curious if small providers are currently exempted from any of these filing requirements?
Krista: We are not exempted from any of the filings. We still have to do the same filings as the larger companies do. We just don't have a designated department that handles the reporting. So, the same people who answer my phones and greet my customers when they walk in the door are the same people who are working on the reporting as well.
Chris: And what -- can you tell us what some of these reporting requirements are? You mentioned some of the form numbers. But they sound about as opaque as the IRS forms that a lot of us just filled out.
Krista: [laughs] Absolutely! The Form 497 is your Lifeline worksheet. It provides, for low-income customers, the ability to have phone at a discounted rate. And so, we have to complete this form, to let the FCC know how many people we have that are on Lifeline. And kind of what the discount is that they are getting it. And to also show that we have received documentation proving that each individual qualifies for Lifeline.
There's also the 499-Q, which is the quarterly reporting. There's a 499-A, which is the annual part of that. And that just basically goes out and it says what our revenues are, what our accounts are, and just kind of a brief overview of what our telecom utility has done in the last quarter or year, depending on the report.
There's a lot of them that have to do with the Lifeline Basic or the Lifeline worksheet. And we do that on a quarterly basis.
We do what we call a CPNI, which is a certification of Customer Proprietary Network Information. All of our individuals who are associated with the telecom utility have to be CPNI-certified on an annual basis. And that is primarily making sure that the customer name, customer account, customer address, and service information -- that we don't release any of that information to the public, or to any type of third-party organization. It's all confidential information. And you have to be trained on how to handle that type of information before you have access to it.
Chris: Is this sort of like, every time I go to my doctor, I have to sign the form saying that I'm aware of all the HIPAA rules, and that I consent for them to share my information with my doctor, and that sort of thing? I mean, is that - you're basically recertifying every quarter that you're uphold- -- you're standing -- you're following the law?
Krista: Right. We're recertified on an annual basis. And it is very similar to the HIPAA regulations. You may notice, if you call to make a change to your telephone plan, we will now be asking you what's your password on your account. And that's just a way for us to verify that the individual we are talking to is the actual accountholder on there. And any time that you make a change to that, we have to notify you through mail that, OK, we've been notified of a change on the account, and this is what was changed. And so, those are all the different CPNI regulations that we have to follow.
Chris: And I can see how that would make sense. But I also just shudder to think of people who are already struggling to keep track of all their passwords and that sort of thing. I have a -- it must be really difficult on your CSRs -- your customer service folks -- to help people out who are calling, and, I just want to solve this, I don't want to remember a password.
Krista: It can cause some frustrations for the customer. So, thankfully, with us being a small community, we know most of the customers, too, by name, by face. So if they're not able to remember it, they can always come directly to the office. And if we know them personally, we can help them. Otherwise, they can show us a photo ID, to prove that they are the individual on the account.
Chris: Yeah, that's one of the big benefits of being a local provider, is that you can -- you know, I don't get that sort of benefit from Comcast.
Krista: Correct. Yes.
Chris: Um. Well, what are some other issues? You had mentioned that there's some mapping requirements that is -- or, that are challenging for a small ISP to handle.
Krista: There are -- one of the more challenging reports is what we call the TR-1. It's the annual report for the telecom. And what that does is, it basically -- you have to tell them how many miles of fiber you have, or how many miles of hybrid fiber coax that you have out there. And you also have to let them know -- more on your assets level. So, more on the financial side. And so that can get a little trivial. And it can also -- you have to know much you've done in the last year, as far as any improvements that you've done to your facilities and to your distribution system. So, if you've put in an extra five miles of line, you have to account for that. If you've replaced five miles of hybrid fiber coax, and you've made it fiber to the home, you have to account for that, too. And we -- one thing that we have started doing is mapping our distribution system. Which helps on many different levels. With reporting, so we can see exactly where our distribution is, where the drops are. And they'll ask for accounts easier that way. The other thing about it -- helps on the mapping side is doing locating for any type of construction as well.
Doug: If I may, please?
Chris: Yeah, sure, Doug. Please.
Doug: You know, when you're looking at a small physical area, like a -- we're a town of 5,200 people -- you're looking at the granular census data, and they want it down to the block. It gets to be a little silly for us -- I mean, we're a small town, and I believe there's two -- maybe three -- census blocks. And when you're looking at serving an entire town, like a municipal utility, your ability to serve the customers within those census blocks is NEVER going to change. It's not like we are -- we're defined territory, in that we pretty much don't leave the city limits. And those census blocks, and the city limits, aren't going to change, because you're not going to have annexation. You're not going to have growth outside of the city limits. So what we're doing is, we're continually reporting the same data that will NEVER change.
Chris: So, there's no option to just basically say, "same as before"?
Krista: No. You have to actually complete the form. You can look at last year's form. But the one thing that we've noticed recently with the FCC is, they make these small adjustment to the form from time to time -- from year to year. And so it's not quite as easy as just copying everything over. You have to actually read what they're asking for, to make sure that that has not changed from the previous year's form.
Chris: Yeah. That -- it seems somewhat remarkable, because they clearly have a method to certify that you're -- that, you know, what you're doing works. It seems like they should have an opportunity for you to certify that you're serving the same addresses you were last year.
Doug: It just becomes a bit redundant. And, in and of itself, every one of these individually makes a lot of sense. What is getting tedious is the compounding of new and additional reporting requirements. And, again, because we're a multiple provider, not only do we see all of us spending an inordinate amount of time on telecom, but we also are seeing the reporting for electric, gas, and water go up. And, again, any one, by itself, is certainly justifiable. But the continuous increase and number of details in reporting across all of the utilities. And we're dealing with a limited number of staff, here, again. So you've got people reporting -- somebody's always reporting something somewhere within this building.
Chris: And, has there been any effort, or do you have any sense of -- a way of streamlining it? I mean, would it be simply a matter of trying to get them to require less reporting from you, to make it easier? Or do you see obvious ways that they could lessen the burden on small providers?
Doug: Well, I think what's required from us, from an ongoing basis, is different from what's required from a Comcast. And I understand, when you're trying to write rules and regulations, you need to have some consistency in what you're doing. But the impact and the value of the year to year data gained -- at some point, it is just not worth it. Again, as a small, rural community, we're actually seeing a DECREASE in population. So the benefit to the data that we can continue to provide, year to year, is going to have somewhat of a diminished value, because of the population. And, again, it's static. It's not going to change. Some of our data may change maybe 5 to 10 customers, year over year. You don't see the wide swings in the areas served from us. Is there a way that they could lessen the burden on us, and make a viable rule and reg? I think, at some point, you look at the -- how many people somebody's actually serving over time. Has there been that much of a change? And at that point, your data's going to pretty much remain static. It's just not going to change that much. So, yeah, at a certain point, a small provider, below a certain threshold, it would be nice to see a lessening of the regulation burden at some point.
Chris: And, to your knowledge, has there been any effort -- I mean, you know, sort of, task force within the FCC to say, you know, we really should treat small providers differently from the big guys that have multiple, you know, departments that just deal with compliance issues?
Krista: Not that I'm aware of. They're -- I mean, they're always talking about certain things in legislature, but nothing that's ever come out and actually made it very far down the pipeline.
Chris: Yeah. That's -- unfortunately, I'm -- you know, it's one of those things that, if you don't have a lot of people in Des Moines, or in DC, then you're kind of locked out of the process, I think.
Krista: Well -- and the one thing, too -- as, being a small provider -- there are a lot of us that are small providers. But even when you add us all up, the number of voices, compared to those for some of the larger providers -- we just don't equate to that. So we don't get the same amount of recognition in the legislature as some of the big folks do.
Chris: You know, it's one of those things that I wish there were something that we could do. We're going to -- we're doing our best to try and raise some of the issues that small providers uniquely face, so that it's appreciated by people in office, and regulators.
But I'm curious if there's anything you want to note before we end the show?
Krista: You know, there's a lot of the reports that we do on a quarterly basis that maybe we don't need to do on a quarterly basis, being a small provider. There's not a lot of change from one quarter to the next. So maybe we could just do that on an annual basis. Or try to consolidate some of these reports so that we're not giving the same information in June that you gave on another report in January -- type of a mentality.
Chris: Right. I think that would make a lot of sense. Doug, did you want to leave us with any thoughts?
Doug: Just in terms of the uniqueness of being a small provider. One of the advantages that we did kind of touch on is that you DO know all of your customers. You DO run into them at the grocery store. You DO go to church with them. You see them at ball games. And I think a small proprietor can offer that service. But the reality of one of the other challenges we have is the financial, and that you can only amortize a piece of equipment over so many people. And so you do have some financial issues with the smaller providers that you don't see in the larger providers. Your -- you know, you are dealing with a limited population base. And it's wonderful that communities like ours were forward-thinking, and saw to where we are today, and said, look, we need to get ahead of this. And they did that 20 years ago. So I think we've been very fortunate from that standpoint. Small providers have their own unique challenges, that -- you know, we don't have the economy of scale, from the Comcast’s and Time Warner’s and things like that. But there definitely needs to be the option, for these small communities, that if they do choose to go down that route, that they aren't burdened by overregulation or anything else, and that the communities can do it on their own and thrive, as communities in this country have shown for hundreds of years. If you leave them to their own devices, give them a chance to succeed, they probably will.
Chris: Well, I hope so. That's sort of the driving focus of our group, is that we can make those decisions at the local level, and we'll have better results when we do.
So, thanks for coming on this show and sharing your experiences with us.
Doug: Thank you, Chris.
Krista: Thanks for having us.
Lisa: Send us your ideas for the show. E-mail us at firstname.lastname@example.org . Remember to like us on Facebook, and follow us on Twitter. We are @communitynets . Thanks again to Persson for the song, "Blues walk," licensed through Creative Commons. We want to thank you for listening. Have a great day.
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