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Thomasville Removes Local Tax, Citing Strong Broadband Revenues

Thomasville is one of six cities served by Community Network Services (CNS) in rural southwest Georgia. We’ve covered Thomasville and CNS in the past, highlighting the benefits of reliable high-speed broadband in these remote rural communities. But one benefit we haven’t covered yet is quite remarkable - Thomasville residents have been paying zero fire tax thanks in large part to revenues from CNS. The City’s fire tax first hit zero in 2012 and was recently maintained there by a Thomasville City Council vote in September.

Thomasville feeds its General Fund with net income (what the private sector would call profit) from its utility services. For 2013, this net income is estimated to reach $8.5 million. What’s more, Thomasville residents enjoy utility prices below the state average. So nobody can complain the City is taking advantage of utility customers by charging excessive rates.

According to a recent Public Service Commission survey, Thomasville residents pay $3.32 per month below the state average per 1,000 kilowatt hours of electricity. And CNS customers who bundle services see annual savings of up to $420. It’s a true win-win - residents get affordable utilities and the City applies the net income to running public services like the police and fire departments, lowering property taxes in the process.

The result is millions in tax savings for Thomasville residents since 2009, when the City set its sights on phasing out the fire tax. In that year, the City collected $1.7-million in fire taxes. In 2010, the City dropped the rate to bring in $995,000. And in 2011, the last year a fire tax was levied, $610,000 was taxed. Based on the 2009 fire tax collection, Thomasville residents have been spared almost $5.2-million in fire taxes since 2010. Speaking about the zero fire tax accomplishment in 2012, Thomasville Mayor, Max Beverly, said “Without the City's enterprise funds like Electric and CNS, we would not have been able to meet this goal.”

CNS is remarkable for another reason. It represents a high degree of collaboration among multiple cities in different counties - a model which could help more rural communities build successful networks. Thomasville could have built a network on its own, but it saw greater benefit in combining forces with nearby municipalities, despite the extra coordination effort involved. The added scale and cost sharing afforded by this model likely played a big role in the benefits Thomasville has reaped from CNS. Rural communities, take note.

Dublin, Georgia: Offering Connectivity to Businesses, Schools, Government Since 1999

Dublin, home to 16,000 people, is also home to a network that snakes through the city and parts of Laurens County. In addition to a natural gas utility that serves the region, the city provides connectivity to two area school districts and local businesses. We contacted Guy Mullis, IT Director for the City of Dublin.

The fiber optic network was installed in 1999 to provide connectivity for the two separate school systems in the community, Laurens County Schools and Dublin City Schools. The school districts needed better connectivity because dial-up was the only option at the time. The school districts could not afford the cost of installing their own fiber networks.

The City used its own funds to construct a network that is 85% aerial. Mullis was not an employee of the City at the time, but he estimates the network cost approximately $1.5 - $2 million. He also believes the funds were a combination of capital improvement funds and economic development funds. From the start, the plan has been to serve the schools but also to provide connectivity to spur economic development.

Eight city school facilities and six county school facilities use the network today for connections between buildings. Dublin City Schools have 10 Gbps speeds between facilities; Laurens County Schools have equipment in place for 1 Gbps connections between schools. Both school districts use the Georgia Technology Authority for Internet access.

Once the network was in place, AT&T and Charter Communications began building in Dublin. Mullis says he does not believe AT&T and Charter would have invested in Dublin in 2000 if not for the presence of the community network. He notes that AT&T begin installing DSL in areas of town within a year of the fiber network deployment. 

During the first few years, the City connected its network to the Internet with a 45 Mbps AT&T connection but needs quickly outgrew capacity. The City looked for alternate ways to connect to the Internet. City staff discovered that a major dark fiber backbone ran through Dublin from Atlanta to Jacksonville, Florida. The company that owned the line (the company has since been purchsed by Level 3) allowed Dublin to splice into the dark fiber to connect to Atlanta. The opportunity allowed Dublin to buy bandwidth at Atlanta prices rather than being stuck with massive markups by the few firms that can provide access. The City has since spliced another line to the backbone to achieve redundancy.

In 2006, the City received a grant through the Georgia Telecommunications Authority to expand wi-fi in the community. With matching funds, the community installed over forty wireless access points and now provide wi-fi hotspots within the City. The presence of the fiber network for backhaul helped secure the grant.

Dublin Wi-Fi Logo

Twelve Laurens County and Dublin City facilities connect to the network. The City also uses the network for voice between city facilities, saving significantly by avoiding dedicated phone lines to each building. When new companies consider moving to the community, the ability to work beyond agency silos is a positive factor, says Mullis. Businesses recognize that cooperative government helps them achieve their goals.

There are forty-five business customers including YKK fastening and architectural products and  Farmer's Home Furniture. The network serves a variety of businesses, including banks, CPA firms, law firms, and hospitals. Prior to the deployment, incumbents could not offer the high-speed connections businesses needed. Since the deployment, cable and DSL have come to Dublin, but the City's commercial customers stick with their City service. Mullis believes local businesses appreciate working with a local provider. When a customer calls with an issue, they know exactly who will address the problem. "They are going to talk to me," says Mullis.

The City currently supplies 200 Mbps for Internet traffic; business and government customers share the bandwidth. Businesses with multiple offices in the area like being able to use the network for local traffic rather than sending sensitive data across the open Internet.

We have reported on many Georgia communities in the past (e.g. MonroeLaGrange, and Thomasville). Unlike the states that surround it, the Peach State does not presently impose barriers on local communities that consider publicly owned networks.  In 2013, ALEC affiliated legislators sponsored sponsored HB 282 but failed to revoke local authority. We anticipate the fight will continue into 2014 and beyond.

AT&T and Charter did not get the job done in Dublin so the community took care of themselves. If large incumbents do not find value in a community like Dublin, it is of course their choice to limit investment. But they should not be able to prevent a community from investing in itself.

HB 286 Refined for New Hampshire Legislature

We caught up with Carole Monroe from New Hampshire FastRoads to get an update on what is happening in the legislature this sesssion. We reported last spring on HB 286, intended to allow local communities more decision making power. The bill did not advance last session, but new language may breath new hope into the proposal.

If the bill passes, it will remove restrictions that prevent local governments from bonding to finance broadband infrastructure. This and similar bills have been introduced in the past, but large incumbent providers always seem to stop them.

Monroe tells us that this session the bill clarifies the definition of "open access network." The bill also changes language regarding "unserved and underserved" areas. Now the bill requires municipalities to include areas without "adequate" broadband if they choose to finance through bonds. "Adequate" in the bill language relies on the FCC definition of broadband as it changes over time, currently 4 Mbps download and 1 Mbps upload. The change does not restrict building in all areas as long as some areas without "adequate" coverage are included.

The new language also clarifies that municipal networks built only for government purposes do not have to be part of the open access model. Past versions of the bill questioned application of the open access model to municipal I-Nets.

While some of the language of the bill has changed, the fundamental goals remain the same. Local communities need to make the decision to bond. In order to do so, state barriers must be removed. Current state law only allows bonding for broadband infrastructure under strict criteria which only apply in a fraction of the state. 

Monroe reiterates that the bill intention is also to create a more competitive environment. She noted that the area is already benefitting from a competitive spirit. Broadband pricing proposals to community anchor institutions show significantly lower rates per Mbps. Service level agreements are more favorable to community anchor institutions since the creation of FastRoads.

Representative Charles Townsend told us via email that the House Science, Technology and Energy Committee met in an executive session on November 12. The committee voted to send the amended HB 286 to the House in January with an "Ought to Pass" recommendation. The vote was 13 to 5 in favor.

Bristol Virginia Utilities to Offer Home Management Services

BVU in Bristol is now offering Quantum Home, a security and home management system that uses the community's publicly owned fiber network. The system allows home owners to also manage lights, temperature, and appliances from anywhere using a computer, tablet, or smartphone. For a quick video demo, check out the BVU website.

Installation costs range between $200 to $2,000 for installation and monthly charges are $39.95 - $49.95. Comcast offers a similar service, Xfinity Home, and requires installation fees to be paid in full when the system is installed. BVU plans to allow customers to amortize the installation fees over 12 months if they wish.

BVU launched OptiNet in 2001 and offers reliable triple-play at affordable prices in Bristol and surrounding areas. We talked with Jim Baller about the history of publicly owned networks in Episode #57 and Episode #63 of the Community Broadband Bits podcast. BVU's OpiNet played a prominent role as one of the first publicly owned completely fiber triple-play networks.

Tricities.com reporter David McGee recently attended a BVU Board of Directors meeting where management described the new service.

“This is an exciting new service that is actually in the market and we’ve already been selling it,” [Authority interim CEO Mike] Bundy told the board... "It will be not just home security but home automation. It’s cutting-edge technology.”

Washington Post Covers Big Longmont Referendum Victory

Last week, we were excited by the results of Longmont's referendum, but we sure weren't alone. The Washington Post's Brian Fung wrote, "Big Cable may have felled Seattle's mayor, but it couldn't stop this Colo. project.

Our regular readers know that Comcast succeeded in defeating the Longmont measure in 2009 but the electoral would not be swayed by false promises and lies the second time in 2011. This year's proposal asked voters to approve a revenue bond for $45.3 million to speed up a planned expansion, which voters approved 2:1.

Contrary to past experience, Comcast and allies did not launch a full frontal assault in Longmont this year to sway the vote. Fung's article looks at the math for a possible  explanation:

There are 27,000 households in Longmont. Even if the city were to connect all of the eligible homes [close to the fiber ring] to its existing fiber network overnight, it would still reach only 1,100 residences. Cable companies therefore spent over half a million dollars [in 2011] trying to prevent four percent of city households from gaining access to municipal fiber on any reasonable timescale. That's around $600 a home, or six months' worth of Xfinity Triple Play.

Even if the cable companies decide it was not worth the fight in Longmont, they have shown repeatedly that they have cash, will travel. Feung's article describes another 2009 election in which the cable industry spent large to prevent public investment in fiber:

In North St. Paul, Minn., a 2009 ballot measure to let muni fiber move forward was defeated by a resounding 34-point margin. Opposition to the fledgling network, PolarNet, was led by the Minnesota Cable Communications Association. In the weeks leading up to the vote, it and other opposition groups spent some $40,000 campaigning against the measure. MCCA alone contributed more than $15,000 to the effort over the same period.

Comcast also exhibits its willingness to spend money to seat industry-friendly candidates. We reported on coverage in Seattle where Comcast contributed heavily to Sen. Ed Murray who won the Mayoral race. Outgoing Mayor Mike McGinn's policy initiative to bring better Internet access to the community threatened Comcast's position. Comcast denies it, but speculation abounds that McGinn's position on broadband motivated Comcast's direct and PAC contributions to Murray. 

From the Fung article:

But what Longmont's experience does show is how large the gulf is between an incumbent industry that can spend money on a massive scale to promote its interests and advocates of municipal fiber that often lack deep-pocketed allies. Those odds made the triumph of Longmont's municipal fiber backers all the more remarkable.

Postcard to Welcome FCC Chair Tom Wheeler

As part of the Media Action Grassroots Network, we are releasing this postcard and have tweeted it to welcome FCC Chairman Tom Wheeler and suggest an action the FCC should take.

Mag-Net Wheeler postcard

Education SuperHighway Wants Better Broadband for Schools - Community Broadband Bits Episode #71

This week's podcast features an interview with Education SuperHighway CEO Evan Marwell to discuss how we can make sure all schools have the Internet access they need to succeed. Education SuperHighway has a plan for connecting all schools with a fiber connection while also decreasing the need for long term federal funding of school connectivity.

We talk about how this can be achieved, as well as the role local ownership can play in ensuring schools get the connectivity they need today and tomorrow without exploding their telecommunications budgets.

This is an important discussion as the FCC is taking comments on how the E-Rate program should be reformed. This is a handy PDF explaining how to submit comments to the FCC on this matter. Education SuperHighway has made a convincing case for its approach and we would encourage any comments that reinforce a preference for local, publicly owned networks as a smart solution.

We want your feedback and suggestions for the show - please e-mail us or leave a comment below. Also, feel free to suggest other guests, topics, or questions you want us to address.

This show is 17 minutes long and can be played below on this page or via iTunes or via the tool of your choice using this feed.

Listen to previous episodes here. You can can download this Mp3 file directly from here.

Thanks to Mudhoney for the music, licensed using Creative Commons.

As Emmetsburg Plans to Vote on Muni Network, Mediacom Misinforms

The Iowa community of 4,000 will take up Public Measure D on November 5th. Voters will decided whether to approve a $3.5 million bond issue to cover approximately half the cost to build a FTTH system. Incumbent Mediacom is distributing flyers throughout the community urging a "no" vote. Community leaders are doing their best to combat Mediacom's propaganda by educating the voters.

We reported about the community's 1998 vote to establish a municipal cable communications or television system. The city did not act on the vote at the time because the project was cost prohibitive. The estimated cost of the project is now about $3 million less than it was in the late 1990s. Emmetsburg wants to seize the opportunity by joining The Community Agency (TCA), a coalition of municipalities in the region that collectively own a hybrid fiber coaxial cable network. Emmetsburg would join with a full fiber network.

The town currently provides natural gas, water and wastewater services through its municipal utility.

In a flyer [pdf] aimed at convincing locals to vote no, Mediacom brags that "Customers in Emmetsburg get the same services as those in larger cities..." Unfortunately, Mediacom's service in larger cities is also awful and more suited to the late 1990's than the modern digital economy. Consumer Reports has rated Mediacom among the absolute worst Internet providers in the United States.

Public Question D reads:

"Shall the City of Emmetsburg, Iowa issue its notes in an amount not to exceed $3,500,000 for the purpose of paying costs of constructing and equipping all or part of the Emmetsburg Municipal Communications Utility, including the acquisition, construction and installation of a fiber to the premise broadband communications system and related equipment and distribution facilities, and including all or a portion of the costs associated with connecting the Emmetsburg Municipal Communications Utility fiber system with the system of the Community Cable Television Agency of O'Brien County a cooperative undertaking among the cities of Hartley, Paullina, Primghar and Sanborn pursuant to the provisions of Chapter 28E, Code of Iowa?" 

In addition to $3.5 million in General Obligation bonds, the Emmetsburg Municipal Utilities would issue $2.63 million in Revenue bonds.

Emmetsburg Utilities

A recent Reporter/Democrat article covered an October 29th information session in Emmetsburg. Representatives from the Emmetsburg Municipal Utility Board of Trustees hosted the meeting to educate voters. A panel of technical experts and community leaders answered residents' questions. 

Curtis Dean [Broadband Services Coordinator from the Iowa Municipal Utilities Association] cited "a real world example: "I was in Spencer for the first decade of the Century, 2000 to 2010. People in Spencer saved over $10 million total on what they paid for their telecommunication vs comparable cities served by the same providers nearby. By the way, when we calculated those numbers in Spencer, we were using Emmetsburg as the comparison." 

If the referendum does not pass, the project will not move forward. If the community approves the measure, public officials estimate construction as early as next spring.

Community leaders urge voters to vote yes. The Mayor and five City Council members published an "Open Letter To Citizens Of The Emmetsburg Community" encouraging a positive vote:

We encourage each and every eligible voter in Emmetsburg to take the time to cast your respective vote on November 5th. This is a very important decision and is one that we should make as a community. Together, we've accomplished many great things in the past. We look forward to continuing to do more of the same in the future. 

A recent letter in the Reporter/Democrat from the Emmetsburg Municipal Utilities Board of Trustees summed up the critical situation that faces many small towns with little or no telecommunications competition:

Progress needs to be supported. If we are not trying to grow we are dying. Many small county seat towns in Iowa are suffering economically and shrinking in terms of population and their ability to be viable for their citizens. This initiative to bring local telecommunications ownership back to Emmetsburg is critical in these efforts to maintain and grow our small community.

Denver Suburb Seeks to Take Back Local Authority

Centennial is asking its voters to reclaim local authority this election. City leaders want to make better use of an existing fiber optic system but a 2005 Colorado state law pushed by a corporate telephone company precludes it. If the citizenry reclaims its local authority through referendum, the City can take the next step toward providing indirect services via its fiber network. 

We contacted City Council Member Ken Lucas to find out more about the ballot question. Centennial is a relatively young city that was incorporated in 2001 and has about 100,000 residents. Lucas told us that this ballot question is not only about using their fiber resources. The community of Centennial considers this a critical step toward maintaining a business friendly environment.

The National Transportation Safety Board (NTSB) provided grants to install the existing network for traffic control, security cameras, and public works monitoring. The City contributed only approximately $100,000 to the network, valued at $5 million. Traffic and public safety now use only two strands of the network that runs through the center of town. City leaders want to use the remaining 94 strands to improve access in the community. To see a map of the fiber and open conduit in Centennial, check out the City's PDF.

Approximately 94% of Centennial businesses and 85% of households are within one mile of the fiber backbone. Residents and business owners can now choose between Comcast or CenturyLink and rates are high. Lucas tells of one business owner who asked Comcast to provide 1 Gbps service to his building. Comcast offered to lease a line to the business at a high rate, but the customer would still have to pay $20,000 for installation.

Community leaders want to encourage more competition and, if they eventually develop the fiber, will explore open access models. Centennial knows their authority to invest in fiber infrastructure will influence economic development. City leaders want to attract high tech jobs to the Denver suburb.

The incumbents have not yet launched an expensive astroturf campaign or lobbied heavily against the ballot question as we saw previously in Longmont. This is the ballot question language:

SHALL THE CITY OF CENTENNIAL, WITHOUT INCREASING TAXES, AND TO RESTORE LOCAL AUTHORITY THAT WAS DENIED TO ALL LOCAL GOVERNMENTS BY THE STATE LEGISLATURE, AND TO FOSTER A MORE COMPETITIVE MARKETPLACE, BE AUTHORIZED TO INDIRECTLY PROVIDE HIGH-SPEED INTERNET (ADVANCED SERVICES), TELECOMMUNICATIONS SERVICES, AND/OR CABLE TELEVISION SERVICES TO RESIDENTS, BUSINESSES, SCHOOLS, LIBRARIES, NON-PROFIT ENTITIES AND OTHER USERS OF SUCH SERVICES, THROUGH COMPETITIVE AND NON-EXCLUSIVE PARTNERSHIPS WITH PRIVATE BUSINESSES, AS EXPRESSLY PERMITTED BY ARTICLE 29, TITLE 27 OF THE COLORADO REVISED STATUTES? 

Centennial does not want to compete with Comcast or CenturyLink - it wants to encourage other providers to compete with each other. Many communites express the same desire to improve telecommunications for their citizens without delivering the services themselves. However, many have found that they have to take an active role in order to ensure a real choice between slow DSL and modestly faster cable, each owned and operated by distant corporations.

Lucas told us that plans to use the fiber are far down the road. For now, the community wants to recapture the power the state preempted in 2005.

Burlington's Next Step: Become a Gigabit Community

Burlington has seen ups and downs over the past few years but a new chapter is about to begin. The non-profit U.S. Ignite and the City are partnering to create BTV Ignite. The initiative will develop a gigabit community infrastructure and the applications that use it. With help from U.S. Ignite, Burlington will join the growing list of gigabit communities.

An advisory committee is fueling interest in the project. Mayor Miro Weinberger describes the effort as a way to develop a tech friendly local economy and increase access for individuals and institutions. A recent Government Technology article quoted the Mayor:

“We believe we’re well on our way to being the first city in the country that provides gigabit access to every student from kindergarten through college and even graduate school here in Burlington,” Weinberger said. 

The City and its partner have developed five critical steps based on consultation with Kansas City, Chattanooga, and other gigabit communities:

1.    Develop Structure to Foster Applications-Driven Energy

Much like the KC Digital Drive in Kansas City, [Executive Director of U.S. Ignite Bill] Wallace said the mayor’s advisory committee must play a key role in helping drive development.

2.    Create the Most Robust Infrastructure

Wallace said this will be particularly necessary for schools, businesses and libraries.

3.    Embrace Technology Through Community Events and Hackathons

By setting up a continuous stream of events like community hackathons, digital sandboxes and a hacker homes network similar to one developed in Kansas City, the city will be able to focus more on app development for specific capabilities, like cybersecurity or the development of complex systems.

4.    Share Practices With Other Cities to Deploy Networks

This could also mean sharing practices on how to generate applications.

5.    Tap into Federal Resources

Wallace said looking to federally funded resources like the National Science Foundation will be important when building out the infrastructure and developing applications.

Burlington hopes to secure a Global Environment for Network Innovations (GENI) rack for its University of Vermont campus. The rack would come from the National Science Foundation and would allow UVM access to researchers at over 40 other universities.

The initiative also aims to create 60 next-generation applications and 200 "community test beds" where the new applications can be developed and eventually deployed.

At an October 15th event to announce the partnership, Wallace and Mayor Weinberger address the ongoing lawsuit between community owned Burlington Telecom and Citibank. The Burlington Free Press covered the event:

“We were aware of that, but basically the capability is there, and that makes Burlington a logical and very attractive candidate to become part of US Ignite,” Wallace said.

“There is some uncertainty about where the dispute with Citibank, CitiCapital is going, but we think it’s time to move forward with this conversation,” Weinberger added. “We think the high likelihood is that these resources are going to exist in this community for a long time to come.”