A battle for broadband: Counties talk need for funding, partnerships and changes in regulations
SLAYTON — Broadband is to people today what electricity was a century ago. People don’t know what they’ve never had, but once they realize the potential, everyone wants access. The struggle is finding private industry to make the investment and leveraging state and local dollars to fund infrastructure.
A Friday morning gathering at the Southwest Regional Development Commission office in Slayton brought together leaders and broadband representatives from multiple counties to share the struggles of broadband expansion with District 22 Sen. Bill Weber (R-Luverne) and District 23A Rep. Bob Gunther (R-Fairmont).
Gov. Mark Dayton is requesting $100 million in bonding for Greater Minnesota broadband infrastructure this session, and Weber said the same amount has been identified in both the House and Senate. Miron Carney, mayor of Slayton and chairman of the SRDC, said a request for $100 million is also on the organization’s legislative agenda.
Expanding broadband border to border in the state
Travis Thies, general manager of Southwest Minnesota Broadband Services (SMBS), expressed the importance of broadband access for economic growth. That agency received a federal grant to provide broadband service and overbuild eight communities, and Thies said, “We’ve been very successful.”
Thies introduced one of his customers, a rural Jackson resident who developed two companies. Troy Rasmussen created a mobile X-ray company in 2010 that relied on a broadband connection to send images. With the help of SMBS, he was able to send the images without having to drive to Worthington to reach a fiber link. Four years later, Rasmussen created a wireless Internet company, which he has now built to more than 100 customers.
“I can’t stress enough how beneficial broadband is,” Thies said.
Jim Sykora, of the First Independent Bank of Russell, said his bank is using T1 lines to digitally connect their nine offices — a process that costs tens of thousands of dollars per month.
“Our bread and butter is agriculture and small business customers. Without them, we don’t exist,” Sykora said. “Farmers need that technology and that connection to the outside world. It’s critical for all of the small businesses we have in this area.”
In Rock County, construction is slated to begin April 19 on a project to deliver broadband service to everyone in the county. Currently, Luverne is the only community considered to be served by broadband — all other areas are either unserved or underserved.
The county received a $5 million grant to build the system, and the county approved $1 million in bonding for its buy-in, while Alliance Communications is investing $8.5 million into the more than 600-mile system.
Rock County Commissioner Jody Reisch said it took a lot of work, including testifying before the House and Senate, to get to where Rock County is today.
“A lot of folks don’t realize the importance of broadband. They think it’s a luxury, not necessarily driven by commerce,” Reisch said. “We wanted to make sure no one in Rock County was going to be slighted. For our board to spend a million bucks, that’s kind of a big deal.”
Reisch, who was recently appointed by Dayton to serve on the Minnesota Broadband Task Force, said if Rock County could share what it learned with its sister counties around the state — perhaps aid in streamlining the process — it may be of some value.
He also said the $100 million proposed in the governor’s budget this year is “just a drop in the bucket.”
Dan Dorman, executive director of the Greater Minnesota Partnership, said it will take at least $300 million, and up to $1 billion, to expand broadband to all of the state’s unserved population today. Dorman spoke Friday about the needs in small communities that don’t qualify for grant funding. In some areas, such as Lac Qui Parle County, all of the rural area is served, but the city of Madison wasn’t able to access grant dollars. The result is a donut, with people in rural areas getting better download speeds than residents of the city.
“Slayton would be left out if there’s a grant in Murray County,” Dorman said. “Is this about economic development or isn’t it?”
One of the concerns raised by attendees was the prevailing wage law and how much of an impact it can have on broadband construction. Rock County Administrator Kyle Oldre said prevailing wages would have driven up the cost of their project by 30 percent to 32 percent.
“We had bids of $14- to $14.5 million, just to put the fiber in the ground — build the trenches,” he said, adding that he would like to see changes to allow counties like Rock, which borders Iowa and South Dakota, to use surrounding state data to determine prevailing wage.
“Out here in Greater Minnesota, we don’t think of trades as being as specialized as unions do,” added Carney.
Ben Humphrey, vice president and manager of Finley Engineering’s Minnesota division, said a lot of contractors in southwest Minnesota are not members of a union.
“All of a sudden, a fiber splicer is called an electrician,” he said, adding that companies have to report weekly or biweekly what they are paying people, and it becomes a complex issue.
Humphrey also raised concerns about CAF2 (Connect America Funds), which are promoting a minimum standard speed of 10 megabytes download and 1 megabyte upload.
“That’s already antiquated in our world,” he said. “10:1 is a Band-Aid. It’s not going to build fiber; it’s going to upgrade copper services. Very little fiber will be deployed with the CAF funding.
“The biggest challenge in building out these services and providing what everybody needs, wants and desires is funding,” shared Humphrey. “We are of the opinion that public-private partnerships are probably the way it needs to go.”
Nobles County Administrator Tom Johnson told the group about its status as a Blandin Broadband Community. Currently the county is working with Blandin on a feasibility study, and Johnson hopes they will one day be able to deliver broadband access to every home, just as Rock County is working toward.
To do that in other counties of southwest Minnesota, many agreed, will take a variety of partnerships.
“There’s not one solution to fix all of this,” Reisch said. “It’s going to take different solutions to try to get this resolved.”
Time, they realize, is of the essence.
“If you don’t get rural broadband here, these kids are never going to come back,” said Anna Haecherl, a Marshall Independent reporter covering Friday’s meeting. “You wouldn’t move to a town without electricity; and I think for the younger generation, you won’t come back to a place that doesn’t have broadband.”
Gunther said the House is committed to $100 million in funding for rural broadband, but he realizes there’s a long way to go.
“Everyone thinks we have a huge surplus — that isn’t the case,” he said. “We have to work on roads, too. There’s an infrastructure problem all over the state. $100 million is the most we think we can come up with.”
“I’m hopeful that we can line up with a number that does as much good as possible,” added Weber. “I think everyone understands the need; there’s differences of opinion. Everyone understands the need of transportation, and we all saw where that went last year.”