Bonnie Lorang - March 12, 2009
Montana Independent Telecommunications Systems
Expanding Broadband Internet
I’ve heard it said that there are four cows for every one person in Montana. I have no idea who’s out there counting the cows, but based on my personal observations, I know that there are many places in our state where the cows out number the people by a heck of a lot more than four to one.
The U.S. Census Bureau estimates that the average population density for Montana in 2007 was 6.6 persons per square mile. That of course includes the high density population areas like Billings, Missoula, and Great Falls.
Twelve counties have one person or less per square mile. One can drive halfway across the State, from Chinook to the North Dakota border and not touch a single county with more than two people per square mile. Then there’s counties like Petroleum and Garfield, Powder River and Carter. They have fewer than a half a person per square mile. I don’t know who counts the half persons. Probably the same guy who counts the cows. At any rate, much of Montana is not just rural. It’s frontier. That presents unique challenges for economic development.
The Federal Stimulus Package, signed into law a few weeks ago, gave Montana’s rural telecom providers a lot to think about. It includes funding for expanding broadband Internet in “unserved and underserved areas” of our Nation. Three Federal agencies will be coordinating this piece of the Federal Stimulus: The U.S. Departments of Agriculture and Commerce and the Federal Communications Commission.
The USDA will oversee the distribution of $2.5 billion for funding broadband projects through its Rural Utility Service or RUS program. One requirement for these projects is that 75% of the area must in a rural location where there is not sufficient access to high speed broadband service.
The Commerce Department will manage $4.35 billion through its Broadband Technology Opportunities Program. It funds competitive grants for broadband in unserved and underserved areas.
Both programs generally limit the Federal funding portion of a project to 80% of its cost. They require Applicants to show that they will obligate funds from non-Federal sources to meet their 20% match.
A third federal agency, the FCC, will partner with the Commerce and Agriculture to develop and maintain a National broadband inventory map. $350 million is allocated for this project which will supplement data from ongoing FCC proceedings that address broadband data collection and broadband public policies.
How will this Federal funding impact Montana? If prudently allocated and leveraged, these funds can spur economic development, expand business opportunities, and create new jobs. If we use broadband funds wisely, the completed projects will leave a legacy for future generations.
Many unserved and underserved areas in our State will have increased access to broadband. Private investment will extend broadband footprints without tapping into State appropriations. Residents and businesses will experience higher broadband speeds and increased capacity required for an ever-increasing number of Internet applications.
Telecom networks, the infrastructure over which broadband travels, will be the stepping stones for economic development. Wireline, wireless, cable, and satellite networks, the backbone of broadband, will generate additional tax revenues for local and state governments. If we wisely allocate the Federal funding to sustainable broadband infrastructure and projects, the effects will be both positive and long term.
The quickest and easiest approach may be to place the new Federal broadband funds in the hands of state agencies to supplement existing projects or initiate new ones. We don’t believe that is the most prudent course to take. The new projects will require a 20% match with state money. We believe it is likely that these projects will require ongoing long term public funding. We predict that they that will require significant state appropriations for recurring expenses long after the Stimulus money is spent.
Montana’s rural telecom providers have served the most remote areas of our State for over fifty years. They know rural Montana and its challenges. They have a history of commitment to its people and communities. They have expertise and experience with modern technologies. They have made major strides down roads leading to ubiquitous broadband access in frontier areas. The areas yet unserved are those that present the steepest of challenges for broadband access, speeds, and capacity.
The Federal funds can be a lifeline to economic development in rural areas. It creates a stimulus for continued investment in rural Montana. It creates an opportunity for providers to leverage private investment with additional one time federal funds to get the most bang for their broadband buck. The result is a solid and sustainable broadband infrastructure that is available to all consumers, public and private. It does this without encumbering revenues from future state and local taxpayers.
Our vision is a future where there are more industries, more workers, more teachers and students, more hospitals and medical facilities in rural Montana. We believe broadband is vital to its economic development. We look to a future where the ratio between cows and people in Montana is a little more balanced.
Bonnie Lorang, General Manager
Montana Independent Telecommunications Systems
Thank you for listening.
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