WASHINGTON, D.C. - Author’s note: Local governments can use their American Rescue Plan relief money to expand high-speed internet access in their area. But could they build their own internet company? Our Washington Correspondent Matt Knoedler recently traveled to North Carolina where one city has created a successful municipal broadband company, and he investigates to see if our local governments can do the same thing in our area.

 

Wilson, North Carolina has features you’ll find in many smaller cities across America: a main street diner, a theater, and a lot of local pride.

Perhaps its biggest claim to fame is something you can’t really see, at least not right away: city-wide high-speed fiberoptic internet. They’ve had it since 2008, a time when many Americans were still using dial-up internet.

“In Wilson, we see high-speed broadband as infrastructure,” said Grant Goings, Wilson, N.C. City Manager.

Everything started in 2006 when Goings spearheaded a municipal broadband project after he said private telecom companies would not invest in high-speed internet in their area. The city would treat broadband internet like any public utility, such as water or electric, where residents would pay the city for its service if they want it. His goal: to both attract and retain businesses.

“We were more focused on not falling behind,” Goings said.

After just two years, Wilson’s city-run internet and cable company, Greenlight Community Broadband, was up and running.

Fast-forward to 2020. When the coronavirus pandemic hit last year, many of the rural Wilson County’s 81,000 residents found themselves in a unique position: At a time when much of the country began working and learning from home and often challenged with internet connection or freezing video calls, Goings says their 600 miles of fiber lines kept customers connected almost seamlessly.

“We built the network linking all of our K-12 schools together, which gave us some real advantages particularly during COVID,” he said.

One year later, Wilson has become a model of sorts for cities and counties interested in building their own broadband program with millions of dollars they received from the American Rescue Plan. The U.S. Treasury’s rules for spending A.R.P. money refers to broadband like water, sewer and other critical infrastructure.  In Treasury’s Interim Final Rule, a 39-page road map explaining how local and state governments can use their newfound funds, they suggest communities spend their money on projects that are “unlikely to be made using private sources of funds.”

Goings and the City of Wilson took out a $30 million loan for their project in 2006.

The National Association of Counties, which advocates for the nation’s 3,069 counties in Washington, D.C., believes the internet investment is a good one.

“We saw during the pandemic that the digital divide between those who had access to high-speed internet and those who don’t was really stark,” said Mark Ritacco, NACo’s director of government affairs.

That stark contrast is also seen in the Federal Communications Commission’s annual report studying Internet connection, which shows 14.5 million Americans still don’t have broadband access. That includes 17 percent of rural Americans. The F.C.C. defines broadband speeds as 25/3 Mbps.

The White House estimates that could be up to 30 million people, according to their fact sheet promoting the American Jobs Plan. President Joe Biden’s American Jobs Plan aims to eliminate barriers preventing municipalities and rural electric co-ops from building their own broadband program. Congress is still considering that proposal.

So, the big question: could local governments in our area start their own municipal broadband company? According to BroadbandNow.com, 18 states have explicit restrictions on such a program. The reason is often to prevent the public sector from undercutting the existing private companies and creating unfair competition.For example, Greenlight – which has been exempted from North Carolina’s new restrictions – now has 45 percent of their local market share, according to Will Aycock, Greenlight’s general manager.

Critics argue the state laws leave some rural areas with only one provider and typically have more expensive costs and slower speeds. Supporters of those laws say there is a history of some municipal networks costing taxpayers money and ultimately failing.

But, there could be a compromise to clear that roadblock: cue the public-private partnership.

“(It) is a great example of how we can use this money to expand internet access,” Ritacco said.

Nearly 500 miles north of Wilson in Mansfield, Pennsylvania, officials from Tri-County Rural Electric Cooperative began hearing complaints from their customers. But those complaints weren’t about the lights.

“We have a lot of members who have come to us who were not even able to get on their computer to check their email, much less stream a video,” said Rachel Hauser, Tri-County’s director of regulatory affairs and economic development.

So, in 2019, Hauser and her team began laying fiber lines on their own.

Tri-County is the private side of a would-be partnership. They started working with leaders across seven rural Pennsylvania counties to expand high-speed broadband internet access. Now, two years later, with the impact of the pandemic is fresh on their minds, they say the timing of their project couldn’t be better.

“Most students, even if they have a laptop or an iPad, they couldn’t get on the internet and they couldn’t access their courses,” Hauser said reflecting on distance education during the pandemic. “That was a really big struggle, and that was across our territory.”

Tri-County’s internet subsidiary, Tri-Co Connections, now has more than 1,000 customers as the rollout begins, Hauser said. That’s seven percent of their 16,500 electric utility customers. The six-year, $77 million project is scheduled to be complete in 2025. But there is hope it could be done sooner if local and county officials choose to partner with them, using some of their covid relief funds.

“It all depends on the political atmosphere and where the priorities are,” Hauser said. “Right now, the priorities are public-private partnerships.”

“I think that each community really needs to look at their own situation and see if a potential partnership with an existing provider is an option,” Goings advised.

Like Tri-County, the City of Wilson is also in the electric business. Both groups own the utility poles and other key infrastructure, so stringing up fiber cable on their own property cut down on costs and red tape.

Back in Wilson, Greenlight became successful enough to spur a co-working space for entrepreneurs and start-up businesses. Marcus Aman produces software for automotive repair shops. He moved from nearby Greenville, North Carolina to Wilson because of the high-speed internet and the affordable rent in the city’s Gig-East Exchange.

“We’re developing software with hardware, so when we’re developing we need to make sure it’s running as fast as possible and there’s no hiccups there,” Aman said.

After only a year, Aman is preparing to move out of the exchange. He is remodeling a restaurant in Wilson that closed during the pandemic, turning it into a new permanent office for himself and his eleven employees.

The spotlight that Greenlight has put on Wilson confirms to Goings that he was on the right track over a decade ago, that there is a desire and need for high-speed broadband in both urban and rural America. The City of Wilson is scheduled to pay off their loan in the next year and a half, he said.

Goings cautions that this massive undertaking isn’t for every community. But he hopes others will see that broadband internet, is.

“I would like to think that the focus in our country would not be how to prevent broadband from expanding,” Goings said, “but instead be trying to figure out how to expand broadband in any form or fashion.”