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Vermont No Longer Counting on Outside Help to Upgrade State's Internet

The following was published in Vermont Biz on July 10, 2019
by Timothy McQuiston, Vermont Business Magazine

The state is no longer counting on an outside force to upgrade the state’s broadband Internet coverage. There is not going to be a single Rural Electrification Act like from the 1930s or an Interstate highway push like from the 1950s. To get high-speed Internet to outlying areas, and even some in-lying ones, several different strategies involving public and private efforts are under way at the state level, but it ultimately will require a local effort to succeed.

“No one is coming to save you,” Representative Laura Sibilia (I-West Dover) told VBM. “This is critical, critical work.”

AT&T’s FirstNet plan to upgrade cell service to benefit first-responders – and by scope assist the public – will likely provide more coverage in Vermont. And commercial investment will also likely expand service.

But it’s clear, Sibilia said, that Vermont needs a local, multi-pronged approach to solving the widespread problem of slow or no Internet.

A new broadband bill (H513) was signed into law by Governor Phil Scott in June that will provide real money, and new financing from the Vermont Economic Development Authority, among other things, to expand or kickstart new programs and businesses.

“Tremendously optimistic,” Sibilia said. “I absolutely believe this is a game changer.”

Sibilia has been a vocal proponent of every effort to get broadband into rural and underserved areas. Her district in Windham County is sprawling and full of mountains and valleys with limited Internet and sketchy cell service. She’s also the Director of Regional Economic Development Strategies at the Brattleboro Development Credit Corporation.

Two years ago, a modest solution to get her district and the surrounding area better connected looked promising.

CoverageCo was a private-public partnership which brought audio entrepreneur Vanu Bose up from Boston with the concept of hanging small radio-based, 2G cell service units on telephone poles. It might have been relatively low tech, but it was relatively low-cost also. It worked. Until Bose unexpectedly died in 2017 and the money ran out. There were many other problems, including AT&T not participating in roaming until near the end.

A lot of utilities, vendors and the state of Vermont were left holding the bag on unpaid bills. Towns like Readsboro, meanwhile, lost cell service and the Internet that went with it.

Sibilia isn’t ruling out a CoverageCo comeback as one small part of the strategy to boost rural coverage. The state owns the equipment and some of it is still sitting never-used in boxes.

“The DPS currently has a survey out to towns regarding their willingness to partner on CoverageCo – has some possibilities, so not dead yet,” Sibilia said. Readsboro could be a candidate, she said.

She said it could be a viable option in some locations and in any case it’s better to get started and not wait and hope for the new broadband law, or something else, to kick in and bring coverage to your town.

Governor Phil Scott signed H513, An act relating to broadband deployment throughout Vermont, in Sibilia’s district. The governor said it invests in expanding broadband connectivity throughout the state.

“While we know it’s not a cure-all to economic challenges, we can all agree reliable broadband is important for economic growth, education, public safety and overall access to information, services and people around the world,” said Governor Scott. “I want to thank the House Energy & Technology and the Senate Finance Committees for their work on this legislation, as well as my team at the Department of Public Service and the Agency of Commerce and Community Development. It was a bill with genuine consensus in Montpelier, which is far too rare.”

Scott signed it at the Dover Town Hall and was accompanied by Representative Sibilia, Public Service Commissioner June Tierney, Representative Tim Briglin (D-Thetford), Representative John Gannon (D-Wilmington), Representative David Durfee (D-Shaftsbury), Representative Kelly Pajala (I-Londonderry), Senator Becca Balint (D-Windham), Karen Horn of the Vermont League of Cities and Towns, and additional members of the Legislature and the administration.

The legislation increases funding to the Connectivity Initiative to provide Internet service in unserved or underserved regions of the state and creates a new Broadband Expansion Loan Program within the Vermont Economic Development Authority (VEDA) to provide implementation capital to start-up broadband providers to develop community-based solutions.

“One of the many things we can celebrate about H513 is that it is a law that doesn’t just contemplate or authorize better connectivity in Vermont. Rather, it is a law that will do things – things that are important for our state,” said Tierney. “More Vermonters will get broadband because of this bill. Vermont communities will have new financing tools and a coach to help with their projects. H513 makes those resources available and so much more.”

Much of the money focus of the broadband law is on the expanded lending authority for a new loan program offered by the Vermont Economic Development Authority.

VEDA President and CEO Cassie Polhemus said, “It’s a public policy initiative.”

She said it doubles VEDA’s lending authority for a single project to $4 million for new or expanding broadband networks. The existing maximum is $2 million for energy loans and $1.5 million on regular commercial loans.

The other big change is that VEDA can be the primary lender, instead of a subordinate one. Typically they work with banks and other financial institutions when financing a larger project.

The annual broadband program limit is $10.8 million. To put that in perspective, VEDA issued a total of about $55 million in 2018.

Because VEDA will be sticking its neck out a bit more, the state is including $540,000 for VEDA’s loan-loss reserves and $6 million more in moral obligation (state guarantee).

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