The last two years have been pivotal ones for the future of high-speed internet access in Minnesota.
The COVID-19 pandemic highlighted and exacerbated the lack of broadband in many parts of the state as people shifted to remote work and school. Congress poured unprecedented amounts of money into subsidizing construction of new infrastructure like fiber-optic cables in Minnesota and across the country.
Meanwhile, fresh data from state officials shows Minnesota actually has fewer households with high-speed internet than previously thought, and has not met a 2022 goal for offering universal access to broadband with modest speeds.
A draft copy of a yearly update is currently being finalized by a Minnesota broadband task force, but here are three things we learned from the preliminary report and broadband advocates about the state of internet infrastructure in Minnesota:
More (and more) money
This summer, state legislators agreed to spend $70 million from Minnesota’s share of the American Rescue Plan stimulus on broadband development. At the time, it was the largest infusion of money for the state’s Border to Border Grant Program since it began in 2014. The state had spent more than $126 million up to that point.
Last December, the Federal Communications Commission also announced more than$408 million for broadband development in Minnesota over the next decade as part of a larger push to spread internet infrastructure across the U.S. The money was doled out to internet providers by the feds.
Now, even more money is on its way.
The new $1.2 trillion infrastructure bill approved by Congress in mid-November includes at least $100 million for broadband in Minnesota. But that’s not all. State broadband officials are hoping to tap into another $110 million in leftover ARP money as well.
The ARP, which passed Congress in March, included $179 million dedicated for “capital projects.”
Federal guidance says there are three types of “presumptively eligible projects” for the cash: Broadband infrastructure, “digital connectivity technology projects” — which includes devices and equipment to facilitate internet access like laptops and tablets — and “multi-purpose community facility projects” which are meant to build or upgrade buildings such as libraries, full-service community schools or community health centers.
But the feds didn’t give that detailed guidance on that money until September. So while lawmakers approved the $70 million for broadband in June using ARP funds, Kevin Mckinnon, a deputy commissioner at the Department of Employment and Economic Development, said the rest of the capital projects money hasn’t been dedicated to anything yet.
The draft report from Minnesota’s broadband task force says the entire $180 million from the capital projects fund should be used on broadband infrastructure grants. If that happens, the state would get at least $280 million between the ARP and the new infrastructure bill for improving high-speed internet access.
Nathan Zacharias, a lobbyist for the Minnesota Rural Broadband Coalition, which is made up of local governments, economic development organizations, broadband developers, businesses and more, said “one of the coalition’s top priorities this year is to secure that $110 million and spend as much as possible on broadband infrastructure.”
“Treasury expects many Recipients will choose to use Capital Projects Fund grant funding for Broadband Infrastructure Projects,” the written federal guidance says. “The COVID-19 public health emergency highlighted that access to high-quality internet can enable work, education, and health access, and that individuals and communities that lack affordable access to such high-quality internet are at a marked disadvantage.”
In the infrastructure bill, more than $65 billion was approved for broadband across the country. Of that, $42.5 billion is getting sent to states for them to distribute, according to U.S. Sen. Amy Klobuchar’s office. Another $14.2 billion will be distributed by the FCC to the Emergency Broadband Benefit program, which offers a $30 monthly subsidy for low-income families to use for internet bills. That subsidy was created in a Dec. 2020 stimulus bill passed under then-President Donald Trump.
The rest will flow through five other programs, including $2.75 billion for Digital Equity Grants, which are aimed at helping “ensure all communities have the digital literacy, skills, support and technology they need to take advantage of internet access,” Klobuchar’s office said in an email.
“Competing in the 21st century isn’t just about roads, bridges, and ports — it’s also about making sure all Americans can access the internet, no matter their zip code,” Klobuchar said in a statement. “As co-chair of the bipartisan Senate Broadband Caucus, I fought to strengthen our broadband infrastructure to make it possible for families across the country to study, work, and connect with loved ones online.”
Advocates are thrilled that states (and not the feds) will distribute the broadband cash
The Rural Broadband Coalition is particularly excited that Minnesota will get to decide how to distribute most of the broadband money in the new infrastructure bill.
That’s because past federal programs have left many local developers frustrated. The vast majority of the $408 million for Minnesota handed out by the FCC, for instance, is expected to go to one small developer called LTD Broadband that has little history of building fiber-optic internet infrastructure. LTD Broadband’s track record, and the long timeline for construction, means other developers, including successful local cooperatives who believe they could act faster to build projects, are left in the lurch.
The delayed guidance surrounding the ARP “capital projects” money has also slowed down projects, the task force report says.
By contrast, Zacharias said the infrastructure bill has more concrete deadlines for the federal government to create a program to distribute money to the states, hopefully leading to faster grants for construction. He said local groups have been asking for, essentially, block grants to the states so Minnesota can use the money for its Border-to-Border program.
“I think that Minnesota has got a great track record of managing broadband money responsibly, effectively and efficiently,” Zacharias said. “This is a huge gift to the state.”
Many, including Benton County, are still frustrated they can’t use ARP money or state grant dollars to build broadband in areas where LTD Broadband won FCC awards to serve. The government has generally said it doesn’t want to subsidize multiple companies in the same area, and LTD Broadband maintains it can provide adequate service on time.
Minnesota still behind on broadband goals
State law sets two primary broadband goals for Minnesota. The first is that all residents and businesses will have access to internet with download speeds of 25 megabits per second (Mbps) and upload speeds of 3 Mbps by “no later than 2022.” The state also has a faster speed goal of 100/20 Mbps by 2026.
Both are considered somewhat outdated. State and federal grants now require subsidized infrastructure to be built so it can scale or accommodate speeds of 100/100 Mbps.
Netflix recommends 5 Mbps download speeds for high-definition streaming. Officials say more complicated work, such as running a business, needs more robust internet speeds.
Still, the state estimates 91.79 percent of Minnesota households and businesses have access to “wireline” internet — DSL, cable and fiber — at speeds of 25/3 Mbps. That’s actually down from 93.27 percent in April and lower than every estimate since October of 2018. Roughly 88.52 percent of Minnesotans have access to 100/20 Mbps, which is also down slightly from April.
That data doesn’t count satellite service like Starlink or “fixed wireless” internet — where a provider broadcasts wifi from a high point like a water tower — but those technologies are part of a hot debate about what should be counted as broadband access and what the state should subsidize.
The state hasn’t actually lost ground. Jen Gates, a DEED spokeswoman, said the reason for the estimated reduction is that the state “received more granular data from both CenturyLink and Charter.”
“We know we have work to do to achieve our goals,” said McKinnon, the deputy commissioner of economic development at DEED, which oversees the state’s broadband grant program.
The draft report from the task force says data used to create maps that government and industry rely on to determine where there is no broadband or slow internet rely heavily on federal information that often overstates the true level of coverage. Advertised speed is often not actually delivered, either, the report says.