The Benton Institute for Broadband & Society has a reputation for looking at today’s reality with an eye toward tomorrow’s needs. In their report, Broadband for America’s Future: A Vision for the 2020s, Benton Senior Fellow Johnathan Sallet continues that perspective and offers insightful recommendations for a new National Broadband Agenda.

Download the report, Broadband for America’s Future: A Vision for the 2020s here.

Broadband for All Needs a New Approach

As access to high-quality connectivity becomes more critical each day, those without fast, affordable, reliable Internet access lose ground more quickly as time passes. In addition to the opportunities that come with broadband access, lack of adoption translates into lack of technical skills. Innovation isn’t slowing down for folks who don’t have broadband. 

As Sallet notes, access to and adoption of broadband improves our economy, strengthens communities, and empowers American workers. Obtaining that access and expanding that adoption, however, is proving more challenging than it should be.

In his report, the author reviews in detail the barriers that have prevented the U.S. from achieving its goal of ubiquitous access and adoption of broadband. He’s able to make recommendations based on four key policy areas:

Deployment of networks where adequate broadband does not exist;

Competition to increase choices and spur lower prices and better-quality service to their residents;

Affordability and Adoption for those who wish to have broadband in their homes but lack the means or the skills to acquire it; and

Community Anchor Institutions, such as schools and libraries, that increasingly serve their users wherever they are. 

Deploying Better Networks, Creating Choice

Applicants in the first round of the U.S. Department of Agriculture’s (USDA’s) ReConnect Loan and Grant Program requested over $1.4 billion to finance rural broadband expansion, exceeding available funds by more than $800 million. Despite tough competition, much of the funding may go to community broadband networks, since more than half of the applicants are publicly or collectively owned, including electric and telephone cooperatives, local governments, and federally recognized tribes.

As was the case in previous federal programs, most community broadband providers applying for ReConnect funds plan to deploy modern, high-speed fiber networks. Unlike the large telecom monopolies, which are letting their rural networks rot even while raking in government subsidies, community owned networks frequently leverage federal funds to deploy future-proof fiber optics in their rural service areas.

ReConnect Review

In 2018, Congress authorized $600 million for the ReConnect program to expand high-quality connectivity in rural America by providing grants and loans to Internet access providers. The first round of ReConnect applications closed earlier this summer with $200 million available in each of the three funding categories:

• 100 percent grant
• 50 percent grant - 50 percent loan
• 100 percent loan

Earlier this year, Congress approved an additional $550 million for the program, which the USDA will distribute after awarding round one funds.

In June, Governor JB Pritzker signed the Rebuild Illinois capital plan, a $45 billion effort that will repair and improve all manner of infrastructure in the state. Within the plan, state leaders intend to dedicate $420 million to upgrade and expand broadband infrastructure. Such a significant investment can make a real difference in the state, as long as decision makers adopt smart policies and allow local communities to receive funding for broadband projects.

Gas Tax for Gigabits

An increase in the state’s motor fuel tax will fund most of the broadband initiative. The increase in gas prices at the pump, which took effect on July 1, jumped from 19 to 38 cents. Similarly, a special fuels tax on diesel, liquefied natural gas, and propane increased from 2.5 cents to 5 cents. State analysts anticipate the increase will garner an additional $1.24 billion to state coffers in 2020.

The Rebuild Plan also grants state bonding authority for infrastructure projects and Cook County municipalities are permitted to raise their gas taxes by an additional three cents per gallon. There are also title and registration fees that will contribute to the fund.

As part of the plan, Illinois created the Connect Illinois initiative, which is part of the Illinois Department of Commerce. One of the goals of the initiative's Broadband Office is to provide all K-12 students with high-speed Internet access at no charge. As part of the Rebuild Illinois plan, $20 million will be used to update and expand the Illinois Century Network, which serves K-12 schools, colleges and universities, public libraries, and Internet access providers.

Connect Illinois and the initiative’s Broadband Office will administer the grants made possible by the fuel tax increase. The office will also work to determine federal grants that are available and how best to access them to advance the state's goals.

Connectivity Council

Earlier this week, Presidential hopeful Elizabeth Warren released her Plan to Invest in Rural America, which contained a framework for improving broadband policy and expanding high-quality Internet access.

You can read her full plan on Medium.

Funding Needed, Spent Wisely

Some of Warren’s goals for proposed policy changes include:

• Passing federal statute that ensures municipalities have the right to invest in network infrastructure
• Ending anti-competitive behavior from big corporate Internet access companies that engage in activity designed to reduce competition
• Pass a Digital Equity Act, which will provide $2.5 billion over 10 years to states in order to help them develop digital inclusion projects

Warren’s plan also focuses on financing infrastructure development in rural areas, and creates some guidelines to address the problems with the current system. Her plan includes:

• Dedicating $85 billion to expand broadband networks with grant funds awarded exclusively to cooperatives, non-profit organizations, tribes, and local government
• Funding will be reserved for regions that are unserved, underserved, or where there is minimal competition
• Grants will only go to projects that offer one discount plan and must include a 100 Mbps symmetrical tier, along with specific requirements for low-income subscribers
• $5 billion will be earmarked for grants to projects that will benefit people on tribal Native American lands

Improving the FCC

Warren also wants FCC Commissioners who will restore network neutrality protections and improve mapping. By making changes in the FCC’s Office of Native Affairs and Policy, Warren plans to further attack the digital divide for indigenous people.

Read more of Elizabeth Warren’s Plan to Invest in Rural America at Medium.

The Office of Broadband Development (OBD) at the Minnesota Department of Employment and Economic Development (DEED) recently released a call for Border to Border Broadband grant applications. The deadline to submit your application is September 13, 2019. 

This year, the State Legislature has appropriated $20 million in funding for projects located in unserved or underserved communities. As a reminder, Minnesota has established the thresholds as:

Unserved area: households or businesses lack access to wire-line broadband service at speeds of  25 Megabits per second (Mbps) download and 3 Mbps upload.  

Underserved area: households or businesses do receive service at or above 25 Mbps / 3 Mbps, but lack access to wire-line broadband service at speeds of 100 Mbps download and 20 Mbps upload.

The OBD has posted a map of the state which allows users to to input addresses and quickly determine if their location qualifies for grant funding. Check it out here. 

Who Can Apply?

As other states have shaped their broadband grant programs, they’ve looked to Minnesota for guidance. One of the shining characteristics of the Border to Border Broadband Broadband Development program has been the diverse field of eligible applicants. In some states, grants can only go to private sector companies, but Minnesota takes an “all hands on deck” approach. Eligible applicants include:

• Incorporated businesses or partnerships
• Political subdivisions
• Indian tribes
• Minnesota nonprofit organizations organized under chapter 317A
• Minnesota cooperative associations organized under chapter 308A or 308B
• Minnesota limited liability corporations organized under chapter 322B for the purpose of expanding broadband access

Eligible Program Costs and Matching Funds

Applicants can only receive grant funding if they provide matching funds, which can come from any public or private source. The project infrastructure must be able to support minimum symmetrical speeds of 100 Mbps.

The fifth anniversary of the announcement of the KentuckyWired project is approaching later this year. As voters start to assess their candidates’ job performance, the unfinished and over budget middle mile public-private partnership (P3) has become an albatross that incumbents aren’t able to easily cast off. When we last discussed the project in 2017, we shared our observations and misgivings. Not much has changed, except some of our concerns have played out and the project has become troubled by new problems.

In Case You’re Just Arriving to the Party… 

The statewide, massive middle mile project officially began when Kentucky announced in late 2014 that they would build a fiber optic network in order to bring better connectivity to rural areas. They planned to find a private sector partner and sought bids. In the fall of 2015, Australian firm Macquarie won the contract for what soon became an even larger endeavor — a fiber optic network that would enter every county in the state at a minimum of one location. The network would consist of approximately 3,200 miles of fiber and connect about 1,000 public facilities. At the time the project was developed, the state estimated that deployment would cost approximately $300 million.

With early bipartisan support, the state allocated $30 million from their budget, which they expected to combine with $23.5 million in federal grants. When the Kentucky Economic Development Finance Authority issued $232 million in tax-exempt revenue bonds and $58 million in taxable revenue bonds to complete financing, Bond Buyer named the issue the “Deal of the Year” for 2015. Macquarie’s timeline estimated an optimistic one-year completion for the entire statewide project.

During this legislative session, state lawmakers in several states passed bills that allocated funds to broadband deployment and planning programs. In many states, elected officials are listening to constituents and experts who tell them that they need fast, affordable, reliable connectivity to keep their communities from dwindling. States that refuse funding to public entities, however, block out some of the best opportunities to connect people and businesses in rural areas. In places such as Michigan, Tennessee, and Virginia, states need to trust their own people to develop necessary broadband networks.

The Great Lakes State: Not Great at Supporting Local Broadband

Michigan’s HB 5670 caught the attention of community broadband advocates when it was introduced by Representative Michele Hoitenga in 2018. The bill was firmly anti-municipal network and after some investigation, it became clear that Hoitenga received guidance from lobbyists from big cable and telephone monopolies. HB 5670, with its sad definition of “broadband” and attempt to fork over state funds to big national ISPs didn’t go anywhere alone after word spread.

Folks from the Michigan Broadband Cooperative (MBC) and other constituents in rural Michigan voiced their concern and the bill seemed to disappear. In reality, the House folded the language into SB 601, a large appropriations bill, which has now become law. Section 806 lists the types of entities that are eligible to receive grants from the $20 million set aside for infrastructure -- public entities are specifically eliminated.

For several years now, Tacoma, Washington, has pondered the fate of its Click! municipal open access network. In the spring of 2018, the community issued an RFI/Q searching for interested private sector partners that would lease the network from the Tacoma Power Utility (TPU). After reviewing responses, consulting experts, and comparing potential arrangements, Tacoma has narrowed the field of possible partners. The goal is to put the network on a sustainable and competitive footing both financially and technologically. Tacoma is following a path that will retain public ownership of the Click! network as the network continues to expand.

Click! has offered considerable benefits during its lifetime, but the network retains considerable debt even as it will soon require more upgrades to continue competing with Comcast. The cable television system is rigged against small operators and while the open access Internet side creates many benefits, Click!’s ISPs just don’t have enough subscribers to make the network financially viable into the future.   The discussion around Click’s finances are complicated because the broadband network is used for both external customers and internal utility uses -- the rate modeling around how to allocate costs is a process that requires subjective analysis (e.g. should the costs be allocated based on bandwidth or evenly split among each service). Some have credibly accused past TPU officials with cooking the books to make Click!’s financial status worse than it actually was. Nevertheless, Click! still doesn’t appear to be financially sustainable when costs are allocated more reasonably. Given the upgrades needed by the cable system, we fear that preserving the status quo will do more harm than good to the community over the medium and long terms; Tacoma needs to make a change to avoid being stuck solely with the broadband monopolies that plague the rest of us.

Current lawmakers in the Vermont House have rapidly advanced H 513, a bill that addresses both policy and funding hurdles in an attempt to expand broadband throughout the state. After a vote of 139 - 2, the bill went on to the Senate on March 26th.

Looking at Local Models

H 513 recognizes that more than a quarter of the state’s premises don’t have access to broadband speeds as defined by the FCC, 25 Megabits per second (Mbps) download and 3 Mbps upload. The state’s Department of Public Service, which assembled the data, also determines that almost a fifth of premises can’t obtain speeds of 10 Mbps / 1 Mbps. With so many rural communities hurting for access to fast, affordable, reliable connectivity, state lawmakers are anxious to find tools to expand broadband across Vermont.

Legislators note in the language of H 513 that they believe the FCC’s “light-touch” approach toward expansion of broadband:

“…does little, if anything, to overcome the financial challenges of bringing broadband service to hard-to-reach locations with low population density. However, it may result in degraded broadband quality of service.”


H 513 goes on to acknowledge that grassroots approaches that use local knowledge and support will be the most successful in Vermont.

Lawmakers and their staff have lauded ECFiber as one model that works in a place like Vermont, where many smaller communities can pool their resources and work together to develop a regional network. As the Communications Union District has developed over the years and dealt with funding challenges head-on, it has become apparent that access to capital is one of the most difficult hurdles to overcome.

Funding for Innovation