In an announcement last week, Alexandria, Minnesota's (pop. 15,000) electric and water utility (ALP Utilities) announced it would be selling its business-facing fiber network to Arvig, a 40-percent employee-owned Internet Service Provider (ISP) that has 54,000 subscribers across urban and rural Minnesota. The deal was for 130 business accounts, including 77 routes miles of fiber and 13 additional miles of conduit, for a total of $3.25 million. Consideration of the move goes at least back to October of last year.

A Practical Solution With Added Local Benefits

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The move sunsets the last of the city's retail municipal network infrastructure, which began as a joint project with Runestone Electric Association in the 1990s that offered DSL service to homes and businesses before expanding to include some fiber offered to local businesses in the early 2000s, and continued today with some additional dark fiber offerings as part of its portfolio. The goal, then as now, was to see how the utility could intervene to improve connectivity options for residents in the area. Christopher spoke with General Manager Al Cowser in 2016 about the efforts' origins and progress in its first two decades of life.

To that end, the deal made sense, shared current General Manager Ted Cash in an interview with ILSR. The financial modeling the utility did when it considered expanding the fiber network to a larger proportion of the city, including the hiring of the staff required to run services in-house,  didn't return the numbers they needed to make it work, he also said. 

The final Board vote took place on January 17th via Resolution No. 2023-01, with no opposition.

What Happens Next?

The U.S. Treasury Department announced another six states have been approved to receive nearly $1 billion in Capital Projects Funds from the American Rescue Plan to bring new broadband infrastructure to more than 180,000 homes and businesses.

The latest tranche of CPF funds is heading to Florida, Georgia, Iowa, Minnesota, Missouri, and Utah, bringing the total number of states to have been approved for their share of the $10 billion fund to 22 states.

Previous awards were announced in June, July, August, early October and late October. According to a Treasury Department press release, the remaining funds for additional states and Tribal territories will be released on a rolling basis.

U.S. Treasury Deputy Secretary Wally Adeyemo said the announcement further underscored the Biden-Harris administration’s commitment to invest in the expansion of reliable, affordable broadband infrastructure as the Covid pandemic “exposed the stark inequity in access to affordable and reliable high-speed Internet in communities across the country.”

This funding will lay the foundation for the Biden-Harris Administration’s historic investments to increase access to high-speed Internet and reduce Internet bills for American households and businesses.

Florida

The Sunshine State is set to receive $248 million to fund new broadband infrastructure that will connect an estimated 48,400 households and businesses, or about 10 percent of locations in Florida that do not have access to high-speed Internet. That amount accounts for 68 percent of the CPF funds Florida will receive as plans for how the state will spend the remainder of funds is still under Treasury review.

AARP Minnesota has taken notice: “broadband infrastructure has not been deployed evenly to communities across the state.”

In an effort to raise awareness about the “good news” of state and federal investments to expand infrastructure and how local leaders and residents can learn how to push for better broadband access in their communities, the Minnesota chapter of the AARP will host a “Critical Access: Broadband Expansion in Minnesota” webinar beginning at 1 p.m. CT Wednesday, Aug. 24.

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Our own Christopher Mitchell, Director of Community Broadband Networks with the Institute for Local Self-Reliance, will be a featured speaker for the one-hour event and will be joined by Cathy McLeer, State Director for AARP Minnesota, as well as Lori Vrolson, Executive Director of the Central Minnesota Council on Aging.

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McLeer has been with AARP Minnesota since 2005, having first served as the Associate State Director for Communications in the South Dakota State Office, then as a Senior Advisor for the Central Region, before becoming the Minnesota State Director where she has been a powerful advocate on behalf of Minnesota’s 630,000 AARP members.

Like countless U.S. communities, Duluth, Minnesota (pop. 86,000) got a crash course on the importance of affordable broadband during the Covid-19 crisis. Those struggles in telecommuting and home education helped fuel a dramatic new broadband expansion plan that, if approved by the city council, could revolutionize affordable access citywide.

Last April, the Duluth Economic Development Authority signed a $65,000 contract with Entrypoint LLC to examine the possibility of building a community-owned fiber network in Duluth. The result: a new Digital Access Master Plan that proposes the city spend $7-9 million to build a pilot open access fiber network in Lincoln Park next year. 

“Reliable high-speed internet is no longer a luxury,” Duluth Mayor Emily Larson proclaimed in a recent state of the city address. “It’s an essential utility no less important to our future success than our roads, water, and electricity.”

A Pilot Project, and Potentially More

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Under the proposal, 75 percent of the new network would be buried fiber and 25 percent would be microtrenched along public roads. The $7 to $9 million estimated price tag is based on a 60% take rate, short-term interest at 5 percent, and a long-term interest rate of 3 percent for 20 years. The initial pilot project would bring fiber to an estimated 1,900 Duluth residents next year. 

“A 60% take-rate may seem aggressive given the strong market position of the incumbent cable operator,” the plan states. “However, the survey data suggests a strong desire among residents and businesses in Duluth to see competition, choice, better pricing, and the reliability of a fiber optic network.”

Like countless U.S. communities, Duluth, Minnesota (pop. 86,000) got a crash course on the importance of affordable broadband during the Covid-19 crisis. Those struggles in telecommuting and home education helped fuel a dramatic new broadband expansion plan that, if approved by the city council, could revolutionize affordable access citywide.

Last April, the Duluth Economic Development Authority signed a $65,000 contract with Entrypoint LLC to examine the possibility of building a community-owned fiber network in Duluth. The result: a new Digital Access Master Plan that proposes the city spend $7-9 million to build a pilot open access fiber network in Lincoln Park next year. 

“Reliable high-speed internet is no longer a luxury,” Duluth Mayor Emily Larson proclaimed in a recent state of the city address. “It’s an essential utility no less important to our future success than our roads, water, and electricity.”

A Pilot Project and Potentially More

Under the proposal, 75 percent of the new network would be buried fiber and 25 percent would be microtrenched along public roads. The $7 to $9 million estimated price tag is based on a 60% take rate, short-term interest at 5 percent, and a long-term interest rate of 3 percent for 20 years. The initial pilot project would bring fiber to an estimated 1,900 Duluth residents next year.

“A 60% take-rate may seem aggressive given the strong market position of the incumbent cable operator,” the plan states. “However, the survey data suggests a strong desire among residents and businesses in Duluth to see competition, choice, better pricing, and the reliability of a fiber optic network.”

Like numerous U.S. counties, large segments of Kandiyohi County, Minnesota (pop. 44,000) lack access to affordable Internet service at modern speeds. So like many underserved communities, the county—situated about ninety miles west of Minneapolis—is looking to take advantage of a once-in-a-lifetime collision of funding opportunities to help finance a massive fiber broadband expansion across numerous county townships. 

A recent survey by the county unsurprisingly reveals that residents are greatly annoyed by the lack of affordable Internet access options, with 64 percent of locals saying they’re dissatisfied with the Internet service provided by regional monopolies.

Ten Projects on Tap

Hoping to address the shortcoming, Kandiyohi County and the City of Willmar Economic Development Commission have been working on ten different projects to shore up Internet access around the county. 

Some of the proposed projects involve partnerships with national monopoly providers like Charter Communications, but others will involve the county and a local cooperative doing the heavy lifting. The county had hoped to fund the projects with a combination of subscriber fees, American Rescue Plan funds, NTIA grants, and upcoming Minnesota state grants.

The first major project closest to being “shovel ready” is a $10 million fiber-to-the-home (FTTH) project in partnership with the Federated Telephone Cooperative of Morris. Federated is expected to finance twenty-five percent of the overall project, with new subscribers expected to pay about $1,250 per household to connect to the gigabit-capable network. 

What’s it take to run fiber to the home? In a new animated video, ILSR Senior Researcher Maren Machles breaks down conduit, the central office, and the "last mile" to give you a birds-eye-view of a typical fiber optic network. Coming in at just under two and half minutes, this video is suggested for folks who need a quick overview of what the last-mile is, and what it takes to build a subterranean fiber optic network. 

Special thanks to USI Fiber, and their willingness to give our team an inside look of the building and operation of their network in Minneapolis. 

Writing and voice over by ILSR Senior Researcher Maren Machles. Animation by ILSR Digital Media Specialist Henry Holtgeerts.