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Building Networks from D.C. to Your Community

Building Networks from D.C. to Your Community

In late October, Lit Communities’ Chief Strategy Officer, Rene Gonzalez and Chief Client Officer, Jessica Fowler traveled to Washington, D.C. to begin building strategic relationships and create awareness of our company and our priority markets. Through the assistance of the Ice Miller Strategies team, we met with five different Congressional offices, the National Economic Council within the White House, and the National League of Cities. 

To build awareness of Lit Communities, we provided an overview of our company founding, mission, and approach to working with municipalities through our Community Assessment process. By explaining our process and outcomes, we were successful in demonstrating how Public-Private Partnerships (P3s) can be leveraged to close key infrastructure gaps and ultimately, the Digital Divide. As an extension of the P3 approach, we also explained how Lit Communities launched Medina Fiber in March 2021, our very first fiber to the home deployment in Medina County, Ohio. 

We talked about our success in establishing a partnership with Medina County’s Board of Commissioners, Medina County Economic Development Corporation, and Medina County Port Authority to leverage its middle mile network for a last mile deployment to nearly 50,000 residential and business customers throughout the County. Medina Fiber is Lit Communities’ first network deployment, and we shared what we are learning through this project and how it can help our future network deployments succeed. Given the onset of federal funding for broadband infrastructure, it was very important for us to share how P3s can be utilized vs. traditional private sector approaches. We also had the opportunity to brief various Congressional offices on the priority markets where Lit Communities is developing partnerships for last mile infrastructure deployment. 

Combined with the timing behind Congress’ approval of the Infrastructure and Investment Jobs Act (IIJA) and the historic funding allocation of $65 billion for broadband infrastructure and adoption, municipalities have a once in a lifetime opportunity to partner with the private sector to ensure that their communities are not left with bandwidth that won’t allow for virtual learning, remote work and telehealth. Coordination and work with federal, state and local representatives will be required by any municipal leader as partnerships with providers and private equity are created. 

We found from our time in DC that there is tremendous support and strong interest from Congressional representatives and their staff in seeing both local networks succeed and the effective and efficient use of resources. There was also interest in the data from the community survey that Lit performs as part of a Community Assessment. How residents in Lit’s emerging markets view current services and their opinions on pricing, reliability and speed were discussed and we have made a commitment to provide Congressional representatives with continued feedback from community members. 

Lit’s Community Assessment process helps municipalities begin this journey of creating enhanced broadband connectivity and learn how to be effective in their role as a partner in a P3 network. The Community Assessment is built around providing answers to three key questions:

  1. What would a municipal network look like? 
  2. How much would it cost to build? 
  3. Would my community support it? 

What would a municipal network look like

A preliminary design for both a middle mile and a last mile network are the assessment’s key elements- the two designs supply important financial metrics used to inform the financial models for the networks and to provide cost information. Think of this middle mile (or “core” network) as the interstate on a road system or a main fiber artery. The middle mile network connects core anchor institutions such as municipal buildings, emergency and health services, libraries and schools and other organizations deemed critical to the wellbeing of the community. The last mile connects homes and businesses and runs off of the middle mile network.  

Example- In Medina, OH, Lit found a middle mile partner in the Medina County Fiber Network. In 2010, the Medina County Port Authority bonded a broadband project, Medina County Fiber Network (MCFN), to create the infrastructure for robust broadband service that could be shared by multiple telecommunications carriers as part of driving economic development within Medina County. The MCFN created a strategic plan in 2017 that addresses expansion of certain fiber trunks into industrial parks and to introduce a residential and small business fiber product through commercial partnering.

In 2021, a relationship was created with Lit’s commercial entity, Medina Fiber, to introduce a

residential and small business offering to Medina County. Medina Fiber is partnering with MCFN and leasing strands to build last mile connectivity to the residents and small businesses of the County. Since March 2021, Medina Fiber has deployed fiber across nearly 4,000 households in Seville, Westfield Center, Montville and Medina City combined. In October 2021, Medina Fiber opened its first Demonstration Center in Seville for customers to provide direct customer service and learn about gigabit internet services and its utilization in the home and business.

How much would it cost to build

Once the preliminary design is completed for a middle and last mile network the number of overall road miles and the estimated percentage of aerial and underground construction are both used to create a financial model with a project budget, income statement, cash flow statement, revenues that can be earned (from internet, TV, VoIP, telehealth, smart home, 5G/small cells services), expenses (engineering, construction and O&M), and debt and equity scenarios.

An important number included in the financial model for communities and their partners to know is the cost per household passed, which is based on engineering and construction costs (labor and materials). Investors in broadband networks watch this number carefully to ensure it falls within their acceptable range (more on this in another blog!). As part of the cost estimating, Lit’s Community Assessments provide for the creation of a capital stack that includes public and private funding opportunities. Local, state and federal funds as well as sources of private equity are part of this stack and combined together can finance the network.  

Lit believes that every community should have the opportunity to have an ownership position in a community network and we strongly encourage municipalities to consider this type of investment. Community ownership in the middle mile network can set municipalities on the path of revenue generation as they can charge for access to their network (think of a toll that is paid on an interstate by every driver!).

Would my community support it

Lit Communities works closely to engage stakeholders and residents through focus groups, town halls and community surveys, all used to gauge and encourage support for a network. Oftentimes there are community institutions and organizations with similar goals and desired outcomes who can be terrific partners with their municipal leaders. The survey is designed to ask respondents questions about current and desired services, pricing, and reliability. Knowing how community members view their connectivity is critical in planning how to address challenges.   

Example- According to the National Digital Inclusion Alliance (NDIA), Brownsville, TX, has consistently ranked as one the least connected cities in the United States, with 47.13% of households without broadband of any kind and 67% of households who do not have cable, DSL, or fiber broadband. Recognizing the severity of this problem, the City established a partnership with seven community anchor institutions to fund the Broadband Feasibility and Digital Inclusion Plan to study and address the lack of broadband in the community.  

In July 2020, Lit Communities began working with Brownsville on a Citywide broadband feasibility study and digital inclusion plan. In July 2021, Lit Communities Broadband, Inc. created BTX Fiber, LLC for the sole purpose of serving Brownsville’s residents and businesses and partnering with the City to provide a source of revenue generation. BTX Fiber will work with the local workforce and community college (Texas Southmost College) to meet both the skills and labor needs of the project. Currently, the City is embarking on a 24 month effort to develop its own 93-mile middle mile backbone network utilizing $19.5 million in American Rescue Plan Act funding, allowing for further opportunities to work with private partners such as BTX Fiber to deploy last mile services in priority areas of the community. Additionally, the City’s proposed network will connect 32 anchor institutions including city facilities, Police, Fire, EMS, and public parks.

With answers to these three questions, municipalities are now poised to consider next steps in making the networks a reality and can engage withs State Broadband Offices as they will be the gatekeepers for all the IIJA funding. Be involved, know your needs, and know how much your solution costs so it can be included in the long-range plan! 

Looking for a guide you can trust to help you explore these questions for your own municipality? Book a free demo with our team today!

Building a Digital Bridge

Building a Digital Bridge

Written by Ben Lewis-Ramirez and Rene Gonzalez

As a result of the impacts from the digital divide in our communities, states, and country we are finally on a path towards closing these critical gaps in our infrastructure and deploying the technology of tomorrow. With over $25 billion in federal funding dedicated specifically for broadband and digital inclusion efforts over the past several years, and state legislative bodies making similar investments across the country, we are finally ushering in a new era for broadband deployment.

Prior to the COVID-19 pandemic, the need to address critical gaps in our broadband infrastructure was evident, however the funding needed to solve the problem and deploy solutions was not readily available. While investment in addressing the needs in rural areas across the country have been assisted greatly by the programs of the United States Department of Agriculture’s ReConnect, Community Connect, and Distance Learning and Telemedicine grants over the past several years, funding has not been reciprocal for urban and suburban communities.

After witnessing the challenges faced by our K-12 schools, universities, and remote workers during the pandemic, it is fair to acknowledge that the digital divide exists in non-rural areas as well. With the funding provided by the federal government in the CARES Act, Consolidated Appropriations Act of 2021, and American Rescue Plan Act of 2021 more efforts are being made by communities, both urban and rural. This isn’t a game about winners and losers, to close the digital divide permanently we must utilize solutions that build greater capacity and quality broadband deployment for the county as a whole.

Beginning in March of 2020, some communities determined that it was critical to utilize local aid provided in the CARES Act to support the deployment of broadband infrastructure in response to the pandemic. While this was a positive development, the deadline of completing all projects prior to the end of December 2020 posed a major challenge. Fortunately, the Consolidated Appropriations Act of 2021 included an extension of the March 2020 local aid until the end of 2021 and the American Rescue Plan Act of 2021 allows for projects to be completed by the end of December 2026.

This is a tremendous opportunity for more communities to learn from the efforts of projects completed in 2020 and make similar investments in their own. Luckily, there will be more time to complete these potential projects this time around! Also, the establishment of the Capital Projects Fund in the American Rescue Plan Act (ARPA) provides an additional $10 billion in funding for communities to make investments in broadband infrastructure. With the Federal Communication Commission’s (FCC) Emergency Broadband Benefit program that launched in April 2021 and new grant programs being implemented by the National Telecommunications and Information Administration (NTIA) such as the Broadband Infrastructure, Tribal Connectivity, and the Connecting Minority Communities Pilot Programs, there are great opportunities to utilize this funding to build greater capacity in underserved communities. Combined with the new leadership of Acting Chair, Jessica Rosenworcel at the FCC, both communities and industry partners such as Lit Communities can now pursue these efforts with confidence.

There is a great sense of optimism that the new leadership at the FCC will address long-standing concerns surrounding the accuracy of broadband mapping and data collections from incumbent providers. While you might not know about the infamous FCC Form 477, you might have been impacted by it. In a nutshell, the data that is currently provided by ISPs overstates availability since data is provided at the census block level. This is a major issue because this inaccurate data not only disqualifies some communities from applying for federal grant funding, but it also results in uncertainty when awarding billions of dollars through the FCC’s Rural Deployment Opportunity Fund (RDOF) and related programs. Thanks to the passage of the Broadband DATA Act (Public Law No. 116-130) and the funding provided in the Consolidated Appropriations Act of 2021, we can be hopeful for a more granular and accurate picture of broadband availability starting in March 2022. With a solid awareness of the homework gap, there is a sense that the $7.6 billion in funding for the Emergency Connectivity Fund will be the start of an approach to expand the E-Rate program to address connectivity beyond the classroom and into the homes of students and instructors. Lastly, while it has been quite some time since Congress passed a major infrastructure bill, there is even more potential to put funding towards broadband deployment and closing the digital divide. Thanks to the leadership of Rep. James Clyburn (SC – 6th District) and other key leaders in Congress have put forth proposals that would authorize more than $65 billion to ensure unserved and underserved communities would have affordable high-speed internet access. 

In the communities of Brownsville, TX and York County, PA, Lit has successfully facilitated the application of ARPA funding for the construction of middle mile network infrastructure. In Brownsville, the city is using ARPA dollars to build a redundant ring configured open access middle mile network which will serve the city’s anchor institutions as well as a backbone for a private provider to build a fiber to the home network.  This is remarkable because Brownsville has consistently ranked among the least connected cities in the United States, with over 66% of the population lacking access to a wireline connection of any kind.  In York, the County is pursuing a similar approach to Brownsville, albeit at a more regional level, and is deploying redundant ring configured open access middle mile infrastructure throughout the County with ARPA funding.

In summary, there is a great deal of momentum building on a number of fronts at the federal level which will have a lasting impact in beginning to close the digital divide, and Lit Communities is working on the front lines to help make building this digital bridge a reality. Learn how we can help YOUR community by visiting our website and reaching out, we can’t wait to bring you faster, better broadband.