COOK- Good news in gigabits descended on Cook last Thursday when it was announced that a regional internet provider has been awarded more than $300,000 in state funds to deploy a new high-speed fiber optic broadband network in the community in 2022.
Bemidji-based Paul Bunyan Communications is set to receive $311,254 from the state Border-to-Border Broadband Development grant program to help fund the project, which is estimated to cost almost $700,000. Paul Bunyan would foot the bill for most of the difference, along with an $8,000 partnership contribution approved by the Cook City Council last August.
“Paul Bunyan Communications is excited to bring our fiber-optic high-speed internet to the city of Cook,” said IT and Development Manager Steve Howard. “The pandemic has made it clear that high-speed upload and download speeds are critical for business, education, medical care and the overall economic vitality of a community. We are proud to be bringing this advanced infrastructure to Cook.”
However, Howard told the Timberjay on Tuesday that there’s one more hurdle to clear before green-lighting the project, a hurdle created by a conflict between state and federal broadband funding programs that threatens to compromise other area broadband projects as well.
Howard said that Paul Bunyan had to scale back the size of its original proposal because the area overlapped in places with census tracts covered by the federally-supported Rural Digital Opportunity Fund. In December, the Federal Communications Commission awarded Nevada-based LTD Broadband nearly $312 million to develop broadband systems for tracts throughout Minnesota, including those bordering Cook.
Minnesota officials won’t allow Border-to-Border funds to be used for locations in RDOF tracts in order to avoid duplication of funding and to develop services in other areas. Since LTD Broadband has RDOF funding for those tracts locked in, Paul Bunyan would have to foot the full bill for locations they originally anticipated would be covered by Border-to-Border funds. Therefore, Howard said, they had to drop some of the proposed service locations outside Cook city limits from the project.
It’s fortunate that the Cook project is still a potential go. When the state Office of Broadband Development in December required Paul Bunyan to remove RDOF areas from five other projects they submitted for Border-to-Border support, all of them became financially unfeasible to pursue.
Howard said he notified city officials of the changes on Tuesday and is awaiting a response indicating if the city still wants to move forward with a smaller project at the same $8,000 commitment.
The system would provide first-time broadband capability to 57 customers and significantly upgraded broadband to 254 more locations, both residential and commercial. The vast majority of those locations are in Cook proper but some locations outside city limits are still included in the proposal because Paul Bunyan determined keeping them while assuming all the costs for their development was economically viable.
Operating at ultra-high speeds of 1Gbps, the system will be almost nine times as fast as the highest currently advertised speed of 115 Mbps by troubled Frontier Communication, a wire-based DSL service with extremely limited access in Cook. Broadbandnow.com estimates that 70 percent of residential locations in Cook do not currently have access to high-speed broadband service.
The Cook award was among 39 announced on Thursday by Gov. Tim Walz and DEED Commissioner Steve Groves.
“The pandemic this past year has made it crystal clear that fast, reliable broadband access is critical for people living in Greater Minnesota for everything from education and health care to business operations and telecommuting,” Walz said. “These grants continue this vitally important work toward our goal of ensuring that every Minnesotan has high-speed internet access by 2022.”
However, 25 other proposed projects didn’t get Border-to-Border funding, and along with the conflict with RDOF funding it’s virtually assured that the state won’t meet that goal.
Townships caught
With LTD Broadband bidding successfully for RDOF funding for rural census tracts throughout the North Country, the game has changed for rural townships that have been working with other internet providers to assess demand and hopefully bring high-speed broadband access to their residents.
LTD Broadband doesn’t have exclusive development rights in those areas, a fact borne out by Paul Bunyan’s proposed plan for limited service in tracts around Cook. What they do have a lock on, however, is government funding to underwrite system development.
Howard told the Cook council last August that the reason Cook and surrounding rural areas didn’t have widely available broadband was that companies couldn’t afford to build those systems without government support. The Border-to-Border award makes the Cook project possible for Paul Bunyan; without it, there would be no project.
Greenwood Township has been working with CTC Internet on broadband possibilities, although getting residents to respond to a needs assessment survey has been challenging. Now that LTD Broadband has secured access to federal RDOF funds and no state money is available, the likelihood of CTC Internet making an enormous investment of its own cash in a broadband system for the township has evaporated.
That doesn’t mean there won’t be broadband access in rural townships down the road, since LTD Broadband has committed to build fiber optic systems in these tracts with RDOF support, but there’s skepticism among many that LTD has the capability to fulfill its pledge.
LTD Broadband won $1.32 billion nationally and $312 million in Minnesota — the most of any one company in the country and the state. The money is doled out over 10 years, but projects are supposed to be built in six years.
LTD’s CEO Corey Hauer said they will deliver gigabit service through fiber-optic internet.
Competitors in the business balked at the auction results because LTD Broadband is a relatively small company with expertise in fixed-wireless internet, where homes get service from a signal placed high on a structure, such as a silo. It can be cheaper to build than fiber, which requires a physical connection to houses, though state officials who run the Minnesota grant program have avoided fixed wireless, arguing it is slower and less reliable than fiber.
Hauer says LTD Broadband has some experience in fiber and is ready to quickly expand and meet the challenge of providing gigabit service to a huge and disparate geographic area.
But competitors argue LTD can’t pull off the gargantuan challenge and wonder if they will pass the next step in the application process, in which the feds will scrutinize their plans in greater detail. Winning bidders have to give the feds more information about their qualifications, their funding and show a bank will issue them a letter of credit.
Given these concerns, a number of Minnesota broadband providers have lobbied DEED to lift the restrictions on Border-to-Border funding so that they could develop competing proposals for service in some of LTD’s census tracts.
Vince Robinson, chairman of the Minnesota Rural Broadband Coalition, wrote to DEED saying the agency should award cash in areas that developers had originally asked for, regardless if they will be covered in the FCC initiative.
Robinson said DEED has “thoroughly vetted” applicants and said the FCC isn’t far enough along in their process to know what areas will be served by that program and at what internet speeds.
“We have shovel-ready projects and a brief construction season in Minnesota, and we cannot afford to wait to see the results of this uncertain process,” Robinson said.
Thus far DEED has given no indication that a change in policy is forthcoming.
MinnPost contributed to this article.