Broadband expansion: Looking down those lonely roads

Photo: East Barnard Community Hall. Courtesy photo.

by C.B. Hall, Vermont Business Magazine Vermont’s seemingly endless pursuit of universal access to high-speed internet service continued on June 8, when Governor Phil Scott signed legislation, H360, which will establish a Vermont Community Broadband Board. The new body will award grants to build out the state’s telecommunications network so as to provide 100 megabit-per-second download and upload speeds – symmetrical 100Mbps, in common parlance.

The new statute places communications union districts, or CUDs, in a pivotal position in the broadband expansion. A 2015 law established the districts as local public entities that – compared to big telecom companies – would have the advantages and incentives of knowing the territory, removing the profit motive, and answering directly to the community in expanding the broadband network, especially in poorly served rural areas.

The scope of broadband expansion is daunting. In its introductory findings, the new law estimates that building out the requisite infrastructure will cost about one billion dollars, which translates into roughly $1,500 for every resident of the state, or about $4,000 for every one of the state’s broadband recipient locations, including those that already enjoy high-speed connections.

The law essentially defines broadband as any internet capability except dial-up; it does not define high-speed broadband, leaving the speed benchmark a matter of some flexibility. Private providers are already offering download speeds of 1 billion bits (1 gigabit) per second – but only in as-yet-limited areas where the fiber-optic cable required for such speeds is in place.

Consolidated Communications, which serves about three-quarters of the state’s 252 municipalities, offers 1 gig service in at least the less remote parts of 20 municipalities.

As for more remote areas, Representative Tim Briglin (D-Thetford) explains that, for companies like Consolidated, there are “return-on-investment hurdles that they have to achieve. They have found serving certain rural areas not profitable enough – or not profitable at all.”

Briglin chairs the House Energy and Technology Committee, which drafted the bill.

Hence the law emphasizes the role of the CUDs.

“Existing providers are not providing adequate service that meets the needs of their residents and businesses while ensuring public accountability,” the legislation’s findings state.

The problem with the CUDs is that putting the fiber-optic cable down Vermont’s innumerable back roads costs a lot of money, and borrowing that money is not easy.

Of Vermont’s nine CUDs, eight have yet to provide service. Still, the CUDs, which are legally speaking intermunicipal unions, now encompass most of the state’s municipalities.

“CUDs are thus positioned to be the unofficial ‘provider of last resort’ for broadband and ensure public accountability for serving all Vermonters within their respective service territories,” the law finds. “Yet CUDs have limited access to financial capital necessary for expansion of broadband to unserved and underserved areas of the State.”

The statute defines unserved as having a download/upload capability of 4 Mbps and 1 Mbps, respectively, and underserved as falling between that 4/1 and 25/3.

Future-proofing

The advantage of fiber-optic lines is something called future-proofing: As demands for speed increase, fiber-optic cable can handle even multi-gigabit-per-second speeds, whereas other technologies cannot.

It’s a matter with some history.

In 2007, then-governor Jim Douglas proposed making Vermont the first so-called e-state, “with universal cellular and broadband coverage statewide in 2010,” according to a 2011 Brattleboro Reformer article.

In late 2011, Douglas’s successor, Peter Shumlin, promised broadband service in every Vermont home and business by the end of 2013.

In 2012 Shumlin’s administration stated that 95 percent of Vermont already had broadband service. But that was under a standard of 768Kbps/200Kbps (kilobits per second) upload and download speeds – speeds that the online world scoffs at today.

In 2014, Governor Shumlin signed legislation, Act 190, whose purposes included, among other things, to “support measures designed to ensure that by the end of the year 2024 every E-911 business and residential location in Vermont has infrastructure capable of delivering Internet access with service that has a minimum download speed of 100 Mbps and is symmetrical.”

That raised the bar, but implementation has remained uneven. Legislation signed by Governor Scott in 2019 raised the minimum standard for broadband funding eligibility to 25/3, to accord with a revised, 2015 Federal Communications Commission definition of broadband.

That law served to “prevent state dollars from subsidizing the construction of outdated technology,” in the view of a comment at that time from the Vermont Public Interest Research Group.

Photo: ECFiber’s Mobile Mapping Unit in action. Courtesy photo.

Now, 100/100 service has emerged as Vermont’s public goal in accordance with a finding by the Department of Public Service’s Emergency Broadband Action Plan, issued in May 2020. And getting to – and beyond – that plateau of speed requires fiber-optic cable.

This year’s legislation sets aside $150 million. If Congress and President Biden can agree on a sweeping infrastructure bill, more money could be on its way as early as the end of this year. But no one is holding their breath on that, yet.

For now, Governor Scott told VBM at his June 15 press briefing that: “We want to expedite the process as quickly as we can. The Legislature did put some oversight in this.”

“So some of it’s out of our hands at this point,” Scott said.

“In the meantime we’ll do all we can to get fiber on the poles and in the ground and do everything we can do to get Vermonters the broadband that’s needed,” he said.

As far as the customers’ costs are concerned, Scott said he hopes the large pot of money available will be utilized to cover infrastructure. This should help keep the monthly charges from having to pay for the build out.

“The CUDs will have a role to play in this as well and they’re almost a non-profit in some respects, so that should be advantageous,” Scott said.

What Scott can do is hire an executive director for the Vermont Community Broadband Board (VCBB).

Hallquist will support roll out of the State’s broadband expansion

Scott Appoints Christine Hallquist

The governor announced on July 12 the appointment of Christine Hallquist as executive director of the newly established VCBB. The Board was created through Act 71, An act relating to accelerated community broadband deployment, to assist and accelerate community efforts to achieve universal access to reliable, high-speed broadband service.

She ran for governor against Scott as the Democratic nominee in 2018. Hallquist previously was a long-serving CEO of Vermont Electric Cooperative.

As executive director, Hallquist will supervise and help implement the Board’s work and policies.

Specifically, she will manage the Board’s administrative budget, hire staff or contractors as necessary, make recommendations to the Board for grant awards and work with the Board to support and assist Communication Union Districts (CUDs) in their planning, development and implementation of broadband projects.

“Expanding access to broadband is critical in a 21^st Century economy, and by increasing connectivity in rural and underserved areas in every corner of the state, we will take an important step toward increasing regional economic equity,” said Scott. “I cannot think of a better person to lead this important effort than Christine. Her experience as a cooperative executive and most recent experience with two CUDs as well as her long-standing commitment to expanding broadband in Vermont will be valuable to this work.”

Hallquist has decades of experience in the energy and utility sectors, including top leadership roles.

Most recently, she worked with NEK Broadband and Lamoille FiberNet, two CUDs working to expand broadband in Vermont. Prior to that she worked in Canada on a joint venture to build a new battery for the electric grid. From 2000 to 2018, Hallquist worked at Vermont Electric Cooperative (VEC), starting as an engineering and operations manager, and serving as CEO from 2005 to 2018, at which time she stepped down to run for Governor.

Hallquist started her career in Vermont working in manufacturing support services at IBM, then took a job in Williston with Digital Equipment Corporation and trained to become an electrical engineer. Hallquist left Digital in 1991 to serve as CEO of a small electronics company and three years later started a consulting company helping manufacturers with process improvements.

“I’m honored and eager to take on this role,” said Christine Hallquist. “I have spent many years working in this space, and I truly believe Vermont’s future depends on getting everyone connected to fiber optic cable. The investment here is historic and I look forward to helping CUDs across the state deliver.”

The Board will consist of five members: Two will be appointed by the Governor, one appointed by the Speaker of the House, one appointed by the Senate Committee on Committees, and one appointed by the Vermont Communications Union District Association. The Board and its work will be supported by $150 million from the federal American Rescue Act Plan (ARPA), a proposal made by Governor Scott and supported by the Legislature.

The new Board will be housed within the Department of Public Service.

Public Service Commissioner June Tierney said, “Christine brings to the table a reputation for excellence as a seasoned utility executive with a proven record in Vermont for successfully meeting challenges and leveraging scarce resources. She has the ‘can do’ confidence and real-world experience needed to engage effectively with the infrastructure planning and market dynamics facing Vermont’s Communications Union Districts. I look forward to supporting the work she and the VCBB will be doing.”

Hallquist starts Monday, July 26, and the first meeting of the Board will occur on August 9.

CUDs Front and Center

The new law’s title, “An act relating to accelerated community broadband deployment,” makes it immediately clear that the CUDs will enjoy the pivotal role as the new Broadband Board oversees the extension of all that cable to the end of Vermont’s country roads.

The providers eligible for the board’s grants include CUDs, small communications carriers such as TDS, and – if they are “working in conjunction” with a CUD – major internet service providers such as Consolidated.

Further, “The Board shall not award a grant to an eligible provider who is not a communications union district unless the Board determines that the provider’s universal service plan does not conflict with or undermine the universal service plan of an existing communications union district.”

In addition to the law’s provisions, big telecom companies will also have to contend with some mixed feelings.

FX Flinn, who chairs the board of South Royalton-based ECFiber, Vermont’s only fully operative CUD, echoed Briglin’s position that the profit motive has made expanding broadband access problematical.

“Because its economy is so small, because it has such a small population, because it has such a difficult geography, [Vermont] has never been a place where the traditional communications providers can really find markets that justify the kind of investment that they’re willing to make in the cities,” Flinn said.

“None of the big market players in the broadband arena have taken an interest in finding a way to help the state of Vermont solve this broadband problem. Have we ever seen a comprehensive proposal from any of these players to build out broadband in Vermont? The answer is no.”

Interviewees at Consolidated Communications hastened to say, however, that the company has been and will continue to be involved in the Green Mountain State’s broadband expansion.

The new law “is what we see in other parts of northern New England,” said Erik Garr, the Illinois-based company’s president for consumer and small business services.

“Legislation that allows for public-private partnerships … is a good thing, and we’re excited to participate with the CUDs in what we think is a big project.

“I go to multiple meetings with multiple [Vermont] CUDs every week. We’re busy.”

The two sides of the money issue

The $1 billion price tag noted in the legislation’s findings was produced in 2019 by a consultant hired by the Department of Public Service.

It’s only one estimate.

Flinn termed the figure “bunk,” while Garr declined to express an opinion, stating however that the broadband expansion will be “very expensive… We assume it would be a very large number.”

The new law sets up administrative processes for the receipt of grants under the federal American Rescue Plan Act, which became law in March.

Under the state budget that takes effect July 1, $150 million in ARPA money will flow into the broadband program to fund projects around the state.

More federal money may come later, and some state money is already being applied to the broadband initiative.

How much more will ultimately be needed forms only side of the money issue, however.

As Tom Evslin of Stowe pointed out in a recent VBM posting, availability of high-speed broadband is problematical for low-income Vermonters.

Evslin, who held high positions in the administrations of governors Jim Douglas and Richard Snelling, noted in an interview that Senator Randy Brock (R-St Albans), a member of the Senate Finance Committee, drafted an amendment to H360 that would have provided subsidies to help more than 50,000 Vermonters obtain the high-speed connections.

“In some places where the broadband is available, it’s either unaffordable or [people] don’t know how to get it,” Evslin said.

Brock’s committee rejected his amendment, which would also have provided resources for community action programs to help people find broadband options that they weren’t aware of.

Asked to explain the rejection, Brock cited “a feeling in the committee that they wanted solely to concentrate on broadband expansion and the bolstering of the CUDs, and wanted to leave the whole issue of affordability to a later date.”

“We can build all the broadband we want, but if the people at those locations can’t afford it, what have we accomplished?” he said. “Absolutely nothing. We should be sure we don’t wind up with two Vermonts – one that’s connected and one that is not.”

‘Affordability is a critical issue,” Briglin responded to Brock’s remarks, “but if the infrastructure isn’t there, there’s nothing that’s affordable.”

Asked if he thought future sessions of the legislature might take up the affordability question, he responded affirmatively.

Once the infrastructure is there, he said, “Let’s make sure people can afford it.”

Evslin estimated that there are 60,000 Vermont locations with no high-speed broadband – meaning service faster than the 25/3.

For broadband, there’s a long road ahead – many long roads, in fact.

CB Hall is a freelance writer from Southern Vermont. Timothy McQuiston contrbuted to this report.