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Broadband expansion put on hold

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News Park Rapids,Minnesota 56470 http://www.parkrapidsenterprise.com/sites/all/themes/parkrapidsenterprise_theme/images/social_default_image.png
Park Rapids Enterprise
(218) 732-8757 customer support
Broadband expansion put on hold
Park Rapids Minnesota PO Box 111 56470

The good news last fall of a $17 million broadband expansion in Hubbard County - providing high speed Internet to all - has been put on hold.

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Paul Bunyan Communications made the announcement in September of plans to extend underground fiber optic cable to an estimated 4,000 homes in Hubbard County.

Work was to begin this spring, the first areas activated in 2013.

But in November, the Federal Communications Commissions "made wide changes to the regulations," according Brian Bissonette, a spokesperson for Paul Bunyan Communications.

There were two issues, Bissonette said of the FCC's changes. The first was a shift in how money was to be allocated in the Universal Service Fund.

But the primary issue facing Paul Bunyan Communications is reforms to intercarrier access compensation that would institute reductions in fees for rural carriers, Bissonette said.

"That's where carriers recoup compensation," he explained of the company's revenue source. "This will have a dramatic impact on the revenue we could accrue," he said of repayment of $17 million loan through the USDA's Rural Utility Service (RUS) broadband loan program.

"Now everything is on hold. It's so frustrating. This has been years in the making," Bissonette said.

"But our responsibility is to our current members," he said of the cooperative. "We can't spend what we can't recoup."

Projects of this nature take 15 to 20 years to break even, he said. "Not knowing what the sources of income will be really impacts the decision."

"This comes from the federal level," Bissonette said of the FCC. Minnesota congressional representatives are "supportive of the situation, but they are limited," in their authority.

"It's so disappointing," he said. "We were prepared to go aggressively and have the project done in two years. We can't say we won't do anything. It's not ruled out altogether, but not on the original scale."

Barb Atwood who with husband Tom owns Evergreen Gifts and Fun Park expressed "extreme disappointment."

Evergreen uses satellite Internet to process credit cards, "but it's not always reliable," she said. And phone lines often go down when it rains. "We have people who want to use the Internet while they are here, but it's extremely limited."

The Paul Bunyan cooperative's board of directors is expected to make a determination on the fate of the Hubbard County expansion plans next month.

Meanwhile, David Collins of the Hubbard County Regional Economic Development Commission is sending out a call to the area's congressional delegation, asking that this become a top priority.

"We need our congressional delegation to work to have the FCC order nullified or reversed or amended in a way that our project could proceed," he wrote in a memo to county and state elected officials.

"And we may need our congressional delegation to extend the deadline for using the $17 million RUS loan authorization," Collins said. "Time is ticking away on us as this issued is being 'discussed' in Washington. The 'reform' issue needs to be resolved, but when that happens, we still need to be able to access the $17 million RUS loan."

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Jean Ruzicka
(218) 732-3364
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