Monday, October 1, 2018

$100M in federal grants awarded for rural broadband in Illinois

Many communities in rural areas throughout Illinois may finally get high-speed internet with help from nearly $100 million in new federal grants, with many schools indirectly benefiting from the build out.

The Federal Communications Commission recently awarded the funding for internet service in rural areas in Illinois. The money, to be spent over the next 10 years, derives from a fund created from fees found on phone and internet bills.

Nine companies won bids totaling $100 million over a 10-year period to serve about 32,000 locations in the state. The funding is expected to bring high-speed internet to homes and businesses in hard-to-reach areas.

A map of the winning projects can be found here.
The largest grant went to Wisper ISP, a Mascoutah-based firm that will get $35 million to connect nearly 9,000 new homes and businesses in southern Illinois. The grants were awarded through a reverse auction process in which they bid to provide broadband with fiber, DSL, or other technology in a specific region of the state. The winning bid was the lowest price offered by a provider.

The buildouts over the next 10 years will offer new customers high-speed internet through various technologies, including broadband, satellite, fiber optics, and dedicated service lines (DSL). People in rural areas have been underserved because it costs so much to build the infrastructure to serve those communities.

While the Federal Communications Commission says that 10 percent of Americans had no access to broadband in 2016, that number was nearly 40 percent in rural areas.

Experts said broadband becomes more expensive as it strains to reach distant and sparsely populated areas. It just takes more cable, utility poles or even cell towers to carry all those ones and zeros longer distances. Yet the costs are split between fewer people than in cities or suburbs.

That’s where the Universal Service Fund charge on most phone bills comes in. It was set up to subsidize phone service for the poor and for high-cost locales, usually rural areas. Now some of that money also goes toward internet service. For example, those taxes support the federal E-Rate program to subsidize internet costs for schools and libraries. Beginning in 2013, another portion was diverted into the Connect America Fund to be spent on information infrastructure in places where it was lacking.

Although the winning companies receiving these new Connect America Fund grants have 10 years to complete the projects, under terms of the grants the firms must bring service to at least 40 percent of the new customers within three years.