Municipalities share funding model solutions for deploying wireless networks

Municipalities have a number of alternatives to fund the deployment of their wireless networks, and no one model will work in all cases. This was the key takeaway from several speakers at the Strategy Institute's 2nd Annual Municipal Wireless Summit in Toronto earlier this month. Georgina ON, a "cottage country" area comprising three towns of Keswick, Sutton, and Pefferlaw along the south shore of Lake Simcoe, found itself in an interesting situation. Although located just an hour north of Toronto, it couldn't get high-speed Internet. "A community like ours has been described by Industry Canada as becoming the ‘missing link' in the national broadband chain," said Bruce Etherington, treasurer of South Shore Community Broadband. The group was formed to spearhead the transition to broadband. It applied to Industry Canada for funding to develop a business plan for building the broadband infrastructure. South Shore secured funding as well as donations from Georgina and neighbouring East Gwillimbury. After submitting a detailed business plan, Industry Canada opted not to fund the $2-million project to create a local fibre/wireless hybrid infrastructure. Being turned down by the department didn't deter the organization. It explored other funding sources, and managed to secure seed funding from the Community Futures Development Corp. The non-profit also secured matching funds from the town of Georgina. Operating and capital loans were granted by the Community Futures and the town of Georgina. Nearly $80,000 came from the Ontario government via the Rural Connections broadband program to see through the first build in 2005. The corporation uses a co-operative fee structure to operate the network. Ottawa was already a highly connected city when in September 2006 the national capital city put up $1 million to expand broadband throughout the outlying rural areas. The city sought a private sector partner to fund the remaining cost of deploying broadband to approximately 40% of rural residents or about 18,000 homes. The city ultimately settled on Barrett Xplore and by November 1, 2007, rural Ottawa had 100% connectivity. The public-private partnership included a service level agreement whereby the city withheld funds to the vendor until deployment was complete. The five-year contract requires the vendor to inject $10 million over the length of the contract, with customer pricing defined for the next five years. It also includes performance audits. For its part, the City of Ottawa agreed to make a one-time contribution of $750,000 toward capital expenses. For Washtenaw County MI, a region about 35 miles west of Detroit covering 720 square miles with two major universities, it was apparent that the private sector would be better positioned to build an infrastructure to make broadband Internet access available to 340,00 residents. "The private sector has the resources, capacity, and expertise to create a successful network," said James McFarlane, senior project manager for Washtenaw County. "We are only an IT department of about 35 people. We saw the involvement with the private sector as a ‘win-win' scenario: the private sector wants to make money, and we want to have a solid network in place." The partnership brought high-speed access to rural residents while ensuring that tax dollars would not be spent on infrastructure construction. In exchange, Washtenaw County agreed to be an anchor tenant and a marketing partner of Wireless Washtenaw. Under the partnership, the vendor, 20/20 Communications, is also using county infrastructure on which to deploy the network, including the water tower and such private property as farm silos. The technology was first tested in pilot projects in three areas with three different types of topography in the first quarter of 2007. After the success of the pilot projects, the network is being built out to the rest of the county, said McFarlane.

Municipalities share funding model solutions for deploying wireless networks

News | February 12, 2008

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