Matt Crescenzo’s business in Scandia is only about 40 miles from downtown Minneapolis, but his internet service is painfully slow. His calls drop and he sometimes needs to reboot his modem several times a day. It also costs nearly $300 a month. For a company that builds and designs automated machinery, internet is crucial for everyday operations. And the lack of it has posed a serious problem to growth.
“The infrastructure is toast out here,” Crescenzo said. “We need a way forward. The technology… moved beyond our rural areas 20 years ago.”
Crescenzo’s Bulltear Industries, the site of a congressional hearing on Thursday, is one of many places in Minnesota still without access to high-speed internet.
Slow or nonexistent web connections have strained businesses, schools, families and the health system around the country, drawing attention from both political parties in state and federal government. While it’s, one of the few truly bipartisan issues in St. Paul and Washington, that doesn’t mean either state or the federal government will move quickly.
Lawmakers at the state Capitol in St. Paul have funded tens of millions of dollars for grants to public and private internet providers to build broadband services. Yet they’re not on track to meet goals in state law.
And while many in Congress have made their own renewed push this year to expand broadband across the country, the House and Senate are still figuring out what changes will look like on a federal level. Minnesota’s congressional delegation, however, says they’re committed to making progress on the issue.
“The top line trend is just that the digital divide both in rural areas and urban areas has been very long standing,” he said. “And remains just as much of a problem as a decade ago,” said Joshua Stager, Senior Counsel at New America’s Open Technology Institute, which pushes for reform in support of open technology and communications networks.
“I think finally average people have realized this is a political issue. They’ve been waiting on hold with their cable company for hours and hours and started to think, ‘Maybe I should wait on the phone with my elected official and call city hall?’”
‘We have to make the investment’
In the U.S. Capitol, there’s been a mixed bag of proposed legislative fixes and changes related to rural broadband, most of them bipartisan. And while Democrats and Republicans have not yet coalesced around a package of bills, there seems to be consensus among members of congress: reliable access to broadband is necessary. And lacking.
More than 12 million Americans don’t have access to broadband, according to information compiled by the House Small Business Committee’s Subcommittee on Contracting and Infrastructure. The U.S. ranks 16th in world broadband access and 13th in average broadband speed, according to the Organization for Economic Co-operation and Development.
“The deployment of broadband is a non-partisan issue. It’s not a luxury anymore to have high-speed internet. It’s a necessity,” Rep. Pete Stauber, a Republican from Minnesota’s 8th Congressional District, said. “And people understand that. Including my colleagues on both sides of the aisle.”
Stauber, Rep. Jim Hagedorn, a 1st District Republican, and Rep. Angie Craig, a 2nd District Democrat, are on the House’s Small Business Committee and showed up to the subcommittee hearing on Thursday.
At the hearing, Craig said she and Stauber have emphasized that any infrastructure package in Congress, long-sought legislation by President Donald Trump and House Democrats, “has got to prioritize investment in high-speed internet in rural America.” Stauber also addressed a historic roadblock for broadband: the high cost of bringing infrastructure to rural places.
“The elephant in the room is of course the money, right?” Stauber said. “But I want to end with this: At some point in this nation’s history our government decided that everybody would receive United States mail. At some point every mailbox mattered. Think about that. Think about that for a minute. We have to make the investment.”
Hagedorn said he was in favor of most broadband solutions, but had his eye on using two existing sources of money to help fill in service gaps in the meantime: The U.S. Department of Agriculture and the Federal Communications Commission. The FCC’s Connect America Fund has been the agency’s primary vehicle for expanding access to broadband in high cost areas nationwide and the USDA provides grants and loans to rural America through the Farm Bill. In 2018, the USDA announced it was offering up to $600 million to internet providers looking to expand broadband.
Hagedorn said he would like to see changes to USDA rules that may limit speeds in some parts of the country. “Probably what we’ll be able to do is something administratively, as opposed to legislation,” he said.
Craig was a co-sponsor of the Access Broadband Act and is also a co-sponsor on the Accelerating Broadband Development by Empowering Local Communities Act of 2019. Her office said the House is currently working on a package of broadband bills.
“Congress needs to be a strong partner in this effort, but ultimately local governments are the experts on how to best implement broadband infrastructure,” Craig said. “Communities across my district need local control over implementation of broadband programs.”
The Access Broadband Act would establish an Office of Internet Connectivity and Growth to direct and track broadband funding across agencies. The bipartisan bill passed the House with a voice vote in early May 2019, with no dissent. Any member can contest a voice vote and ask that all votes be counted, but neither a Republican nor a Democrat asked for a full floor vote.
The second bill Craig co-sponsored would negate an FCC rule that limits the ability of local governments to regulate 5G deployment in their communities. That bill currently has 48 other cosponsors, none of them Republicans. And while that doesn’t necessarily doom the bill, it may signal a bumpier way forward.
Whether or not similar measures appear in the Senate may be a signal of what exactly is bound to pass both chambers. The Access Broadband Act has a companion bill in the Senate. Sen. Amy Klobuchar just released two new bills with bipartisan support to produce better mapping of existing high-speed internet services and to require the Secretary of Commerce to measure the economic impact of broadband.
Stager said that just because Congress is now pushing for a package of broadband related bills does not mean that they are actually tackling the problem quickly or head on. For example, although New America has worked on pushing the federal government to do more expansive mapping of broadband in communities around the country, as one of Klobuchar’s bill would mandate, Stager said that still won’t solve the overarching problem.
“This should not be the big moonshot that Congress is working on in terms of the digital divide. If it takes a few years to finally gets these maps perfected, then what? We still have all these places that are unserved,” he said. “The mapping issue is really just step one.”
While he thinks that congress is making steps forward in the right direction, he is concerned that progress is being made too slowly.
“Everyone needs to do something or say to do something,” said Stager. “I would caution that when you’re looking at a lot of these rural broadband bills, that many of them are very small ball.”
A step, not a leap forward at state Capitol
Rural broadband has drawn wide support at Minnesota’s Capitol, too, and they appear to have taken more concrete action than Congress. During this year’s legislative session, which adjourned last week, lawmakers mostly debated how much they could afford to spend on the issue.
In the end, they approved $40 million in the two-year budget for a grant program that helps build high-speed internet systems. The achievement was celebrated by lawmakers in the Republican-led Senate and majority-DFL House.
“Small businesses need high-speed internet to function and thrive in today’s economy,” said state Sen. Torrey Westrom, a Republican from Elbow Lake who chairs the Agriculture, Rural Development and Housing Finance Committee. “Much like electricity revolutionized rural communities 80-plus years ago, high speed internet is revolutionizing rural communities today.”
Paying for broadband expansion is not new in the Legislature, either. Since 2014, the Legislature has doled out more than $85 million for the Department of Employment and Economic Development’s “border-to-border” grant program, which supports projects across the state.
Combined with private and federal money, the spending has led to real progress. In 2015, just 68 percent of rural areas had access to internet with download speeds of at least 25 megabits per second (Mpbs) and upload speeds of 3 Mbps, which is considered broadband by the federal government. As of April 2018, 79 percent of the state’s rural population can access internet at the 25/3 rate.
There has been some opposition in St. Paul to government intervention in rural broadband policy. A few lawmakers have argued there are cheaper options than fiber-optic cable, the state’s preference. The approach is costly, yet reliable.
The telecom industry has sometimes fought to stop government broadband projects where private companies already offer some form of internet. And free-market conservative groups also say that government-owned broadband reduces innovation and competition. The Freedom Foundation of Minnesota, a conservative think tank, has argued it’s also risky since they may not have the expertise of telecom companies. They have pointed to the crumbling of Lake County’s broadband service as a cautionary tale.
Still, Danna MacKenzie, the executive director of DEED’s Office of Broadband Development, said Minnesota has better broadband access than most states thanks to efforts from Republicans and Democrats.
“To be so strongly supported by all parties really says a lot about their understanding of the importance of this as kind of an underlying issue that touches all the other things they care about — whether it’s K-12, health care, public safety, rural economic development,” she said.
MacKenzie noted, however, that Minnesota has a long way to go to reach its own goals for high-speed internet. By 2022, state law says all Minnesotans should have access to 25/3 speeds. By 2026, the goal is speeds of 100/20. Only 59 percent of rural Minnesota has access to 100/20, compared to 73 percent of the state as a whole.
Gov. Tim Walz’s initial two-year budget plan proposed $70 million for border-to-border broadband grants. MacKenzie said that figure came from a state task force, which estimated it would take roughly $35 million a year in state spending to meet the 2022 goal.
MacKenzie said the state won’t meet that 25/3 benchmark with the $40 million approved by lawmakers. It’s also a small piece of overall broadband funding compared to private investment and federal programs, she said.
But in a year at the state Capitol in which lawmakers were split on practically every priority and Republicans fought against tax increases, the broadband program was one of the larger blocs of new spending.
State Rep. Anne Neu, a North Branch Republican who serves as the assistant deputy Republican leader, said the cash will help continue the border-to-border program, keep projects moving forward and maintain a line of hope for communities without fast internet. Neu was at the Scandia event Thursday. Crescenzo’s business is just outside her district.
“Forty million is not going to get the job done, that’s the reality,” Neu said. “But I think it’s a good start.”
For Crescenzo, the issue is urgent. He said he first moved to Scandia to raise kids, and his business has managed to grow. But to flourish, Crescenzo said he simply needs better internet. At the hearing on Thursday, he urged Congress to act.
“If we were to do it over again — where we’re at now, we couldn’t do it,” he said.