State sweetens deal for towns building own fiber networks (original) (raw)

WINDSOR — From state offices in Boston, the unexpected cost Windsor faced, in its quest to build a fiber-optic network, might seem paltry.

After all, 450,000representsjustmorethanonehundred−thousandthofthisyear′s450,000 represents just more than one hundred-thousandth of this year's 450,000representsjustmorethanonehundred−thousandthofthisyear′s43.3 billion state budget.

But that shortfall in what Windsor officials thought it would cost to prepare utility poles to receive new fiber cables would have been felt by taxpayers, in one of about 20 Western Massachusetts communities that opted to build their own broadband networks with state help.

Rather than have to dig in local pockets, Windsor secured an additional $450,000 from the state Executive Office of Housing and Economic Development to cover "make-ready" costs not anticipated years ago, when a study badly miscalculated how much small towns would need to invest in utility poles.

In all, the state office has so far marshaled $3.5 million from a contingency fund to cover unforeseen costs for seven towns, including three in Berkshire County: Alford, Becket and Windsor.

The gap for Windsor would have been a lot more if Eversource hadn't, on its own, decided to upgrade as many as 40 utility poles along Route 9 as part of a separate effort to increase the capacity of its grid.

Douglas McNally, the Windsor Select Board member leading his town's broadband effort, said state officials, particularly Gov. Charlie Baker, have come through time and again for towns without high-speed internet service.

Proof of that turned up just this week, when Verizon crews arrived in town to prepare poles to receive fiber-optic cable later this fall, an essential step that officials feared would drag out.

"This is earlier than we expected," McNally said. "The governor has been diligent in pestering the utilities. They're like bulldogs after the utilities. The governor is himself sitting in on teleconferences or face-to-face meetings, asking, `OK where are you?' The utilities are responding. I'm a lifelong Democrat, but this Republican governor is doing a good job."

As work moves forward, Windsor now expects to connect all premises to its new broadband system by next May or June. It appears that at least 65 percent of addresses will opt for service, enough to meet the town's business plan and make the network self-sufficient.

In Alford, the state also chipped in an extra $125,808 to cover a gap in make-ready funding for a system that's up and running and more than covering its operating costs.

"We're actually doing extremely well," said Jay Weintraub, who helped launch the AlfordLink service. "We're profitable and very much within our expectations."

Alford's broadband system has signed up about 75 percent of premises in the town.

"We're extremely happy," Weintraub said. "It's been a very long and involved process. It's a monumental effort."

The extra money plowed into municipally owned broadband projects represents about 10 percent of the state's overall investment in such ventures, according to Brian H. Noyes, a spokesman for the Massachusetts Technology Collaborative. He said additional funding will be made available to towns that "establish and document actual versus projected make-ready costs."

For Windsor, 75 percent of its added funding is being delivered as costs arise. A quarter of the promised funding is being held back, McNally said, until the state is confident that all towns in need of extra money get at least 75 percent of their unanticipated costs covered.

Other Western Massachusetts towns to secure extra funding from the state include Heath, New Salem, Shutesbury and Wendell, all in Franklin County.

Of the initial group of unserved towns, only one, New Braintree, is still looking for a plan to obtain broadband service, Noyes said.

Federal help

Windsor and other towns building their own networks still hope to secure financial backing from the federal government as well.

As The Eagle has reported, six Berkshire County towns also stand to receive $2.4 million over 10 years through the Federal Communications Commission's Connect America Fund.

Along with Windsor, towns that could receive money from the FCC grant are Alford, Becket, New Ashford, Otis and Washington. Westfield Gas and Electric, which is managing most of the municipal broadband projects, applied for the FCC funding on behalf of its client towns.

Since that funding was announced last September, a snag emerged, when the FCC required Westfield Gas, which applied for funding on behalf of towns, to post a $1 million bond. The utility could not do that as a nonprofit, but the state of Massachusetts stepped forward, according to McNally, giving the Windsor official one more reason to appreciate a governor of another political party.

The $886,172 that Windsor expects to get through the FCC program — in installments over the next decade — represents a "game changer," McNally said last fall.

He said Monday that if municipal broadband projects succeed in connecting 96 percent of premises, funding will be released. That money will be enough, in Windsor, to cover roughly half the cost of borrowing.

Instead of taking out a 30-year bond, McNally said he now thinks it will be possible for Windsor to cover the cost of its new network in under 10 years.

Meantime, signs of progress are everywhere in town. A new "hut" that will house electronics for the network is in place behind the town offices. Propane that will power a backup generator was hooked up the other day.

And Eversource and Verizon crews are traveling Windsor roads.

"You can't turn around without seeing a utility truck drilling and planting a pole," McNally said. "People are believing now."

Larry Parnass can be reached at lparnass@berkshireeagle.com, at @larryparnass on Twitter and 413-496-6214.