Tag Archive for: broadband

China Broadband Committee members return to grant application

by Mary Grow

At their June 3 meeting, China Broadband Committee (CBC) members returned to their application for a ConnectMe planning grant for expanded and improved broadband service. They also reviewed a more definite – but still with uncertainties – financial model for their project (see the June 3 issue of The Town Line, p. 3).

The ConnectMe grant was filed May 27. State officials replied, not just to the CBC but to all applicants, with a request for more information on two topics, with a deadline of noon on Friday, June 4.

CBC Chairman Robert O’Connor put the application on the CBC’s document-sharing site so members could work on it and offered to call ConnectMe the morning of June 4 to clarify what was needed. A revised application was filed and acknowledged; committee members expect to hear before the end of June whether China will receive $7,500 (to be matched by $2,500 in town funds).

The first major planning issue is a survey of telephone poles, unserved houses and other factors that will affect the cost of building new broadband infrastructure. CBC members intend to have Hawkeye Connections, Inc., based in Poland, Maine, do the survey (and if the plan comes to fruition, the construction).

Consultant Mark Van Loan, of Bangor-based Mission Broadband, said he and Mark Ouellette, President of Axiom Technologies, of Machias, developed the revised financial model. Like prior ones, it is based on estimated construction costs.

If the construction costs are close to accurate, the model sees China borrowing $4.8 million for 20 years to build out the system. Assuming 35 percent of year-round residents and 40 percent of seasonal residents sign up initially, a program offering four levels of service could have a $55 monthly fee for the lowest tier.

The plan would additionally provide two levels of business service. Ouellette, whose company is the CBC’s choice for providing broadband, expects most small businesses would be able to sign up for the less expensive residential service.

The most expensive tier, at $200 a month, offers gig over gig (one gigabit upload, one gigabit download) for households with a lot of devices and/or users. Ouellette thinks the offering is underpriced.

“Most of the world – not Maine, the world – can’t get a gig,” he said.

If the model’s assumptions are close to accurate and the proposed fee schedule is adopted, broadband service would run a deficit for not more than the first three years. After that, it would return an annual profit to the town over the life of the bond. Once the bond was paid off, the town’s share of the revenue would be larger.

Ouellette is confident that when residents start using Axiom, their satisfaction will lead to more customers and increasing revenue. The model does not include grant money, which committee members think is a definite possibility beyond the planning stage.

The model builds in a 25 percent profit for Axiom – but, Ouellette said, the company will be taking all the risks of providing and maintaining broadband service, and a bad year with hurricanes and ice storms taking down lines and poles would be expensive.

CBC members accepted the model, by consensus, as their working document.

They scheduled their next meeting for 4:30 p.m. Thursday, June 10. By then they should know whether China town meeting voters approved the revised Tax Increment Financing (TIF) plan, which includes funding for some aspects of broadband service.

Committee urges people to take computer speed test

ConnectMe officials and China Broadband Committee members urge people using computers to take the speed test, to see how much service they have. Speed test results help define areas that do not have adequate broadband service by state or federal definitions. The web addresses for taking speed tests are https://www.mainebroadbandcoalition.org/ or https://www.mainebroadbandcoalition.org/speed-test-info.

The site provides instructions and offers a link to a map showing area test results. China has numerous red dots indicating limited service.

China broadband committee members review models of potential offerings, prices

by Mary Grow

China Broadband Committee (CBC) members reviewed models for potential broadband offerings and prices for customers at their May 26 meeting and asked for more definite information, if possible, to share with residents.

They also worked on an application for a Phase II planning grant from ConnectMe to help them get the information.

And they talked briefly about Spectrum Community Solutions, the company currently providing internet service to an estimated 70 percent of China households.

The CBC plan requires enough income from broadband users to repay a proposed bond that would fund costs of new internet infrastructure; to pay for ongoing internet service; and to provide a profit for the company that provides the service. Committee members do not want to suggest an increase in local taxes to support the project.

The currently proposed service provider is Machias-based Axiom Technologies. Company President Mark Ouellette participated in the May 26 discussion, as he has in previous meetings.

Consultants Mark Van Loan and John Dougherty, of Mission Broadband, had developed models showing what levels of service could be offered at what prices to make enough money to cover expected costs.

They were still dealing with the problems that have plagued earlier predictive efforts: until experts survey the town to see how many new poles and how many miles of cable are needed, construction costs are estimates; and until Axiom finds out how many customers want their service – the “take rate” – income is an estimate.

The goal is a maximum monthly charge of $50 for the lowest tier of service. That low a price is achievable in Van Loan and Dougherty’s models, assuming a high enough take rate.

The models propose a 15 percent discount for seasonal residents. One version would offer four service levels, the top – and most expensive — one named the Tod Tier in honor of committee member and self-described geek Tod Detre. Detre doubts many other residents would need the Tod Tier.

CBC members made no decision on a plan. They agreed they need to have one before they begin making presentations to enlist residents to sign up.

The ConnectMe grant application was due by midnight May 27. Ouellette, who had assisted another town with the same application, offered advice; Selectboard Chairman Ronald Breton and Town Manager Becky Hapgood called in their approval; and committee members planned to finish the grant during the day May 27.

They succeeded. CBC Chairman Robert O’Connor reported that an application for $7,500, to be supplemented by a $2,500 local match (from contingency funds, Hapgood suggested during the meeting), was emailed to ConnectMe before the deadline.

If ConnectMe awards a grant to China, the money will be used to pay Hawkeye Connections, Inc., fiber optic specialists based in Poland, Maine, to do an engineering review of “roads, premises, and telephone poles” that will define construction costs more accurately and improve cost estimates.

On the third topic, O’Connor told the rest of the committee he had received a communication from Spectrum, the most recent of several sent as CBC discussions proceed. Spectrum was one of three applicants to provide enhanced broadband service. After reviewing all three proposals early in 2021, CBC members chose to negotiate with Axiom.

O’Connor’s belief is that Spectrum officials are willing to submit proposals to match each improvement Axiom offers; but, he pointed out, they have not taken any action. He and Detre are among those saying that Spectrum cannot meet Axiom’s service level with its existing equipment.

The meeting ended with consensus that Van Loan, in consultation with Ouellette, would continue to work toward a more definite model, and that the committee would meet again at 4:30 p.m., Thursday, June 3.

CHINA: Broadband costs big unknown at this point

by Mary Grow

After two more hours April 27 revising their explanatory document for China Community Broadband, China Broadband Committee (CBC) members presented it to the selectboard at a joint virtual meeting April 29.

The ensuing two-hour discussion focused on costs and on what service customers could expect.

Costs are a big unknown at this point, presenters said. The plan includes estimates, but they are only estimates, for two main reasons:

  • Costs for construction materials are likely to change, up or down or both, by the time work starts, and the amount of construction work – for example, the number of new poles needed – is unknown until contracts are signed.
  • The number of users who sign up for the new service, the “take rate,” determines monthly income, which needs to cover repayment of the proposed construction bond plus operating costs. CBC consultants have prepared scenarios based on different take rates without knowing which is closest to accurate.

Consultants Mark Van Loan and John Dougherty, of Mission Broadband, had three tables showing financial results with three different take rates, from 1,005 to 2,270 customers, resulting in three different fees per household, from around $85 per month to around $50 per month. These prices will vary with costs and with whether and by how much seasonal residents are billed differently from year-round residents.

Mark Ouellette, President of Machias-based Axiom Technologies, with whom CBC members are negotiating to provide service, said he usually gets high take rates as his company moves into new towns, including towns like China with existing providers.

In China, CBC members estimate that Spectrum Community Solutions serves about two-thirds of households; Consolidated Communications serves about 20 percent; and about five percent have no internet connection.

Another factor influencing costs to customers, CBC member Tod Detre said, is that the committee’s current plan is to offer only one level of service, which he calls gig over gig. The phrase means one gigabit per second can be uploaded to the net and one gigabit per second can be downloaded.

Selectman Wayne Chadwick doubted most people need that fast service. Detre agreed, and said the committee plan could be amended to offer as options lower service levels at lower monthly fees, if China residents prefer.

Assuming selectmen authorize CBC members to continue, a next step is to start a comprehensive community outreach program to determine how many households want what level of service.

Prompt sign-ups would provide useful information, but committee members and consultants realize that some residents will wait to see whether selectmen present the construction bond at the November 2 elections and voters approve it.

Service would be established if a minimum number of users sign up. Another issue concerning selectmen was whether people who sign up later would be charged a fee. Again, the answer is to be determined; one possibility would be to schedule future open enrollment windows during which fees could be lowered or eliminated because multiple houses would be connected while trucks and workers were in town.

Town Manager Becky Hapgood suggested selectmen discuss whether to continue to support the CBC’s work at their May 10 meeting. If they do support the committee, next steps include:

  • The community outreach program, envisioned as including email, social media, meetings, printed materials and probably other methods;
  • At the June 8 town business meeting, voter action on the Second Amendment to China’s Tax Increment Financing document, which adds broadband service to approvable TIF projects and provides funding to continue working with Mission Broadband;
  • Selectmen’s request for authorization to issue a bond and a Nov. 2 voter decision on the bond.

The amount of the bond is undetermined because construction costs are undetermined. Committee members suggest an “up to” figure – currently estimated at $6.5 million – so selectmen are not obligated to borrow more than is needed.

When Chadwick asked Ouellette why Axiom didn’t borrow the money, Ouellette replied that towns get a much lower interest rate than private companies.

The CBC plan would have Axiom build the fiber optic infrastructure, using a contractor, provide service, take care of billing and maintain the system. The town would own the system and could change providers should Axiom prove unsatisfactory.

A contract between Axiom and town officials, to be signed if the bond issue is approved and nothing has impaired the company’s relationship with the town, would spell out details selectmen asked about, like the contract length, construction schedule, how often Axiom would pay China its share of revenue and whether the local on-call repair person would work for Axiom or for China.

The CBC’s goal is to provide a town-owned broadband system offering all residents high-quality service that is easy to update as technology changes, at a price that will cover costs and, after the bond is paid off, generate extra revenue.

The document CBC members presented to selectmen April 29, titled “Community Broadband Project – Declaration of Intent” is posted under the Broadband Committee in the list of officials, boards and committee on the China website, www.china.govoffice.com.

China broadband committee continues developing proposal

by Mary Grow

China Broadband Committee (CBC) members continued discussion of their developing proposal for extended and improved China broadband service at their April 8 meeting.

Joining them virtually were Mission Broadband consultants Mark Van Loan and John Dougherty, and Mark Ouellette, President of Axiom Technologies, of Machias. Axiom is the company CBC members chose to negotiate with, from three respondents to their request for proposals.

The April 8 discussion concentrated on three points: costs, the need for better service and plans to explain those points to China selectmen and voters.

Ouellette and the Mission Broadband consultants had revised Axiom’s original cost estimate from around $9 million for a complete new system to around $6 million. Both figures are based on many assumptions. Four main ones involve timing; the amount of work that will be needed; outside funding sources; and the “take rate,” how many people will sign up for a new service.

Timing: there was consensus that interest rates are likely to increase, and the plan includes the town borrowing through the Maine Bond Bank. Van Loan added that the contractor Axiom works with to build systems predicts a five percent increase in materials costs by June.

Amount of work: Van Loan expects any contractor to bid high and hope to save money. For example, he said, a bid is likely to cover replacing all the poles needed to carry the wiring, but the contractor might find some or most of the existing poles useable.

Outside funding sources: one possibility is that federal funds will cover part of the work China needs, depending on federal regulations and funds available. Ouellette suggested China’s project might be eligible for state planning money.

Take rate: the more people pay monthly user fees, the more revenue comes in to cover operating costs and debt repayment, and until a new service is defined and explained the take rate is a guestimate.

To the experts on the committee, the need for better service is a given. They cited results of a survey, to which 308 China residents responded, describing how they use internet in pandemic conditions.

Sixty percent of respondents said they needed the internet to work from home and 25 percent used it for their home office. Forty percent used it for elementary and high school education and another 11 percent for post-secondary education.

Twenty-three percent of respondents used the internet for telemedicine, a use that committee members expect will increase.

More than 80 percent used the internet for at least one of these categories: researching and getting news; filing taxes; social media; and entertainment.

Committee members Tod Detre and Jamie Pitney explained that Spectrum, which provides broadband to an estimated 70 percent of China residents who are connected, lacks technical capability to increase its speed up – the amount of information a user can send – to meet contemporary needs.

Spectrum was designed with more speed down, so that users can download from the web, with the original focus on entertainment. Now, Detre said, people are sending more – making zoom calls, sharing photos and videos, hosting games, for example.

Suppose, he said, someone in the house is making a zoom call. That call will use most of the available bandwidth going up, and if someone in the next room starts playing a video game, the zoom call will die.

An important difference, Detre and Ouellette said, is that Spectrum uses copper for the final connection from the system to the user’s house, and copper has limited capacity. Axiom uses fiber, which is longer-lived and, as they described it, more adaptable.

Ouellette is unimpressed with the quality of service provided by Consolidated Communications, the company that supplies the other 30 percent of China’s broadband.

Returning to Selectman Wayne Chadwick’s question at the April 1 CBC meeting, Detre asked Ouellette what would happen if something like the 1998 ice storm took down lines all over town. Ouellette replied that both the town and Axiom have insurance; as planning progresses, they can decide which would provide less expensive coverage for a town-owned internet system.

As the virtual meeting ended, Chairman Robert O’Connor mentioned the Spectrum outage earlier in the week that he said had canceled scheduled zoom meetings in other towns. China’s new system will need built-in redundancy, he said later, so a single downed line or equipment malfunction “won’t take out the whole town.”

CBC members have invited China selectmen to a joint meeting scheduled for 7 p.m. Thursday, April 29. Ouellette said he would forward more information to Van Loan and Dougherty that they could summarize for CBC members to share with selectmen.

CBC meetings are also scheduled for 7 p.m. Thursday, April 15, and Thursday, April 22. The virtual meetings can be viewed as they occur and on tape via the live stream connection at the bottom left of the Town of China website, www.china.govoffice.com.

China Broadband Committee rearranges future schedule

by Mary Grow

With four of China’s five selectmen joining their April 1 virtual meeting, China Broadband Committee (CBC) members rearranged their future schedule and discussed what might be good news.

Committee members had been scheduled to make a presentation at the April 26 selectboard meeting. Instead, they added a Thursday, April 29, meeting to their schedule, with selectboard members specifically invited to join the live stream.

The CBC was already scheduled to meet at 7 p.m., April 8, April 15 and April 22. Selectmen – and interested residents – are welcome to watch those meetings also, via the Live Stream tab at the lower left of the town website, china.govoffice.com.

The maybe good news came to CBC Chairman Robert O’Connor in an email from Peggy Schaffer, Director of the ConnectMaine Authority. She notified him that the 2021 American Recovery Act will provide $23 million in broadband funding to Kennebec County, with China’s share expected to be $430,000.

Schaffer’s email said the United States Treasury has not issued guidelines for using the funds. CBC members therefore do not know how much, if any, money might be applicable to China’s project.

CBC members looked into an earlier grant that provided funds only for unserved and underserved areas. Most China residents have access to broadband service at some level. At the April 1 meeting, committee member Jamie Pitney cited two estimates of households with no access, out of 2,100 to 2,300 properties: 83, according to ConnectMaine, or 140, according to current provider Spectrum Community Solutions.

Schaffer suggested the CBC prepare an informational presentation to the Kennebec County Commissioners.

CBC members spent most of the April 1 meeting repeating previous discussions for the benefit of selectboard members, with O’Connor, Tod Detre and Jamie Pitney sharing their expertise.

They said China needs better broadband service than Spectrum can provide with its current equipment and technology. A faster, more reliable and more flexible system would expand opportunities for residents, including adults working from home, children attending school remotely and everyone looking for entertainment and communication; and it would give China an advantage in attracting new, high-tech businesses.

They prefer a model that would have the town own the infrastructure and contract out building it, maintaining it and providing service. Under that model, should a service provider be unsatisfactory, town officials could seek a different one.

After reviewing proposals from Spectrum and two other companies, CBC members are negotiating with Axiom Technologies, of Machias, with assistance from consultants Mark Van Loan and James Dougherty of Portland-based Mission Broadband.

They are not ready to make a recommendation to the selectboard. They have no firm cost estimates; no consensus on covering costs (a bond issue has been discussed); and no agreed-upon definition of services to be provided.

Their present position is that the contractor(s) would do the billing and would maintain the town-owned infrastructure. After Selectman Wayne Chadwick asked what if something like the 1998 ice storm brought down lines all over town, CBC members thanked him for the reminder and planned to include a provision ensuring the contractor handled disasters as well as routine repairs.

Chadwick remained skeptical about town involvement. Everything government does is “top-heavy and inefficient,” he said; he would prefer a private contractor take on all aspects of the service.

CBC members agreed they will present updates at selectmen’s meetings, either by Selectman Janet Preston, the board’s non-voting representative on the CBC, or by O’Connor. Should they get new information, like Schaffer’s email, between meetings, they will share that, too.

China selectmen ask for more info from broadband committee

by Mary Grow

Ronald Breton, Chairman of the China Selectboard, requested and received time on the China Broadband Committee’s March 25 agenda. In return, CBC members ended their meeting by drafting an email request for time on the selectboard’s April 26 agenda.

Breton complained that CBC members are failing to keep him and the rest of the selectboard informed about their activities. What he knows, he reads in The Town Line, he said; and the articles make it sound as though the committee is trying to “sell” a broadband plan to townspeople before consulting the selectboard.

If people are convinced that broadband is “good and great,” and selectboard members find otherwise, he fears “They’ll get their asses kicked” by indignant residents.

Speaking as a selectman, he expressed two concerns: he does not want taxes to increase, and he does not want any broadband system to impose more work, like collecting bills or “running a utility,” on town office staff.

He also questioned the CBC proposal to prepare a letter of intent to continue negotiations with Axiom Technologies, of Machias (see The Town Line, March 25). Breton believes only selectmen, not members of committees appointed by the selectboard, have authority to sign letters of intent.

Committee member Jamie Pitney, who had drafted a nine-point outline of a document the committee could flesh out and present to Axiom president Mark Ouellette, agreed with Breton on the authority question. “Letter of intent” is probably incorrect wording, he said; the idea is to give Ouellette something more than a verbal assurance that he is not wasting time negotiating with the CBC.

At their March 18 meeting, CBC members and Ouellette talked about Axiom helping not only to plan broadband service, but also to develop a community outreach program to present information to the selectboard and residents.

After Breton zoomed out of the meeting, committee members further discussed the outreach program. At one point, Tod Detre and Chairman Robert O’Connor were talking about what residents might want for broadband service: would 25 up and 25 down be enough, or would people insist on at least 100 over 100, or maybe a gig over 100, or gig over gig?

“Can you imagine this discussion in a community meeting?” Pitney protested. “You’ll lose two-thirds of the people in the first 10 minutes.”

Members talked for more than an hour about different facets of providing broadband service, including the option of starting with a partial build-out (for $2 to $3.5 million) instead of going town-wide in one swoop (for $6 million or more); the possibility of cooperating with other central Maine towns, and what legal structures might be needed to do so; and potential grant opportunities.

They ended their two-hour meeting with two decisions: to ask to talk with selectmen on Monday, April 26, and to meet at 7 p.m. each of the first four April Thursdays (April 1, 8, 15 and 22) to prepare for the April 26 meeting.

On April 26, the selectboard is scheduled to hold consecutive public hearings, beginning at 6 p.m., on the Second Amendment to the Tax Increment Financing (TIF) document that governs expenditure of TIF funds and on the warrant for the June 8 annual town business meeting (which includes the TIF amendment).

Breton said he expects the hearings to be short enough so the selectboard meeting will begin about its usual time, 6:30 p.m.