City of San Francisco Considers an Innovative New Way to Deliver Ubiquitous, Open Fiber to its Residents, Businesses

We at CTC have had the honor of advising the City and County of San Francisco on broadband planning for a dozen years, and we’re proud that the City today released our new study on “Fiber for San Francisco” and is also, with the leadership of Mayor Ed Lee and Supervisor Mark Farrell, initiating an innovative procurement to select a private partner to finance, design, build, and operate a fiber network that would reach every home and business in San Francisco.

We’re been working on this initiative since early 2017, with a project team that includes our friends at IMG Rebel, a creative and experienced financial advisory and P3 structuring firm that provided the perfect expertise to match our broadband engineering and business planning capabilities.

The City directed us to develop a delivery strategy for ubiquitous fiber-to-the-premises to every home and business in San Francisco that would be open, offering equal potential access to the network by multiple ISPs enable competition. The City directed that we consider the potential for (1) fully public, (2) fully private, or (3) public–private partnership (P3) arrangements for financing, designing, constructing, maintaining, and operating the network—with the policy goals of enabling equity, innovation, and local authority.

As part of this engagement, our engineers developed a technical design and cost estimate for deployment of a fiber network that would connect (on an open access basis) every home and business in San Francisco, and then we evaluated how such an infrastructure could be delivered.

What we found is that private broadband investment is resulting in new broadband competition in unevenly distributed ways across San Francisco. AT&T is upgrading its network to fiber in certain areas, but not, to our knowledge, on a ubiquitous basis. Comcast has recently upgraded its residential service footprint with DOCSIS 3.1 electronics that will allow speeds of up to a gigabit in the downstream direction, but this network still relies on coaxial cable for distribution and the gigabit service is priced in excess of $150 per month. On the competitive side of the industry, a new class of competitors including Sonic, Webpass, and Monkeybrains is making important investments in fiber and other technologies in some San Francisco neighborhoods, but these new networks are available only in certain areas and to certain buildings or consumers. In addition, none of the incumbent or competitive providers in San Francisco operates its network on an open basis, allowing its competitors to reach consumers over its infrastructure.

We therefore concluded that the private sector is not currently poised to deliver the City’s stated goals of ubiquitous, open, fiber-based service throughout San Francisco.

A purely public network could meet goals for ubiquity and openness, but the City has raised a number of areas of concern, including internal capacity to build and operate a new utility; public finance challenges in light of the many important project vying for public financing, and the substantial risks of proceeding on a purely public basis. Indeed, in a purely public model, the City would meet its policy goals but would assume all project risk, including construction, operations, performance, customer service, demand and market considerations, and technology change. A parallel set of concerns relates to public sector capacity and interest in building, maintaining, and operating a communications utility, including the particular challenge of operating a communications network in an area of the country where hiring professionals in that field is most competitive.

As an innovative alternative, we evaluated the potential of P3 delivery. This mechanism enables the City to own the core infrastructure and use it to achieve policy goals such as competition and equity—at the same time as shifting some risk to the private sector and leveraging private sector delivery capabilities. In a formal P3 structure, a selected private partner takes responsibility for some combination of design, construction, financing, operations, and maintenance, at least partially funded or guaranteed by the public partner over the period of the concession.

Formal P3s have emerged in the broadband sector in other parts of the world where infrastructure is more frequently delivered through a P3 than in the United States. In the past few years, a range of creative broadband P3 structures has started to evolve in the United States. The nature of these P3s range from public sector facilitation of private broadband investment (through process, regulation, and economic development incentives) to public deployment of infrastructure for use by the private sector.

What is novel about the Fiber for San Francisco Initiative is that it contemplates application of the “classic” P3 structure to a broadband network that would reach 100 percent of the homes and businesses in the community.

Our report includes extensive technical, business, and financial analysis of how a P3 delivery mechanism could be structured to meet the City’s goals. For more (much more), download our report here.

We welcome your comments or questions—feel free to reach out to us at I hope to hear from you.

Joanne Hovis

October 18, 2017

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Published: Wednesday, October 18, 2017 by CTC Technology & Energy



A Technical Guide to Dig Once Policies

Our latest white paper, A Technical Guide to Dig Once Policies, is a discussion of technical considerations regarding dig once conduit, a comprehensive process for developing dig once policies, and examples of dig once policies across the country. Read it here.

For more information on the benefits of dig once policies, see CTC’s Gigabit Communities

A Technical Guide to Dig Once Policies

During his campaign, President Trump vowed to rebuild the nation’s infrastructure, with a plan to spend more than $500 billion fixing the country’s aging roads and highways. This type of investment could also provide an opportunity for local and state governments seeking to increase the deployment of broadband networks.

While internet service providers are often trying to reach new consumers, the process of installing fiber networks can be prohibitively expensive and time-consuming. Local and state governments can ease the process by adopting a “dig once” policy, which requires public and private excavators to coordinate with local government on the installation of extra fiber or conduit whenever ground will be broken in the public right-of-way (PROW).

“Dig once” policies were identified as a best practice for local governments by the Obama administration’s Broadband Opportunity Council as a means of enhancing competition in the broadband market.[1] The Council noted an important truth: “While sound national policies and programs are important, most decisions on broadband investment are made by Local governments in partnership with the private sector, guided by State law.”

Dig once policies have many benefits, including:

  • Protecting newly and recently paved roads and sidewalks
  • Enhancing the uniformity of construction
  • Ensuring efficient, non-duplicative placement of infrastructure in the PROW
  • Reducing overall costs of all underground work in the PROW, both utility- and telecommunications-related, for public and private parties
  • Facilitating private communications network deployment by reducing construction costs
  • Leveraging construction by third-party entities for the deployment of a public communications network, or deployment of conduit that can be made available to other entities

While dig once policies are beneficial, they are not a one-size-fits-all policy prescriptive. To develop “best practices” guidance for local governments, we surveyed the approaches adopted or proposed by jurisdictions across the country. In the process, we interviewed representatives of cities and other government entities that have adopted such policies, and reviewed the treatment of costs in dig once scenarios.

Based on our survey and our own experience, we identified three general approaches:

  1. Some communities require an excavator applying for a permit in the PROW to notify utilities and other relevant entities about the project and invite their participation.
  2. Localities with a “shadow conduit” installation policy require the excavator to install excess conduit for future use; depending on the policy, the excavator or the jurisdiction may then lease that excess capacity.
  3. Other localities undertake a longer-term process, coordinating multi-year plans with excavators.

We recommend that localities consider the following steps in developing an ordinance or policy:

  • Prioritize projects suitable for additional construction, based on a scoring mechanism
  • Develop a refined estimate of the incremental costs during the design stage
  • Develop a standard engineering specification for dig-once conduit
  • Develop a procedure to systematically track and manage the construction and to create a repository of existing infrastructure

For state and local governments and the public, the advantages of dig once policies are significant and easily understood. But, while fiber and conduit materials are relatively inexpensive, dig once construction is still costly—so many factors should be taken into consideration to ensure dig once policies are implemented in a cost-effective and useful way. Communication between local government and the companies that would potentially use the conduit is critically important. Localities should also establish a system to track its planned, ongoing, and completed construction.

Read the paper in its entirety here.


[1] “Broadband Opportunity Council Report and Recommendations,” U.S. Department of Commerce and U.S. Department of Agriculture, August 20, 2015, (accessed July 26, 2016). See also: “Executive Order on Accelerating Broadband Infrastructure Development,” Federal Highway Administration, U.S. Department of Transportation, May 5, 2016, (accessed July 26, 2016).


Published: Friday, April 14, 2017 by CTC Technology & Energy



Producing Value through Effective Governance

CTC just published a new paper on the steps community broadband network operators can take to develop an effective governance process to maximize value to the community.

Operating a community broadband network entails complex technical, financial, and strategic business considerations—and those decisions are all made within a governance framework.

Effective governance enables a locality to organize its decision-making to produce the greatest value. While value is measured in terms unique to that community, the key to good governance is that the network’s value will reflect the community’s needs. For example, a local government might construct a broadband network to lower the cost of its internal communications services, promote economic development, or serve local schools and libraries. In each of those scenarios, the locality’s governance should ensure that the network delivers on its stated goals.

In this brief white paper, we describe a high-level approach to adapting a governance process to support identified needs and produce effective value. This approach includes:

Identifying key goals and objectives

As a project unfolds and stakeholders and needs are identified, goals and objectives are often added and shaped in the context of what is realistically achievable with available resources.

Identifying key stakeholders

While a more comprehensive stakeholder analysis needs to be completed as a project’s objectives and operational model are fleshed out, the initial core goals and objectives point to natural leaders, advocates, and stakeholders who need to be active participants in the project.

Focusing on needs and value

Periodic re-checks help to keep your governance development aligned with the issues that matter to your community—and to ensure that you have the right stakeholders engaged in the right roles.

Identifying strengths and weaknesses

What changes need to be made in terms of organization and staffing to effectively manage operations?

Developing an appropriate organizational structure

Strengths and weaknesses are always relative to something—some idea of what the network should deliver, and to what extent the necessary pieces for delivery exist.

Managing strategic governance

Identify roles of stakeholders depending on whether the stakeholder represents a service provider, service partner, or client; and what resources and information the stakeholder brings to the table.

Retooling organizational structures as needed

The degree of organizational change necessary to support a fiber optic network can vary widely, and depends heavily on the phase of the project. Newer projects can involve drastic change, while those undertaken by mature organizations may only entail modest changes.

Developing key performance indicators

The industry standard is the balanced scorecard, which considers leading and lagging indicators from different perspectives, and ties those back to strategic objectives and goals. What makes most sense for your network should be something you continually discuss with your stakeholders.

Read the white paper in its entirety here.

Published: Wednesday, April 12, 2017 by CTC Technology & Energy



How the Local Oversight Process Addresses the Concerns of the Public Sector in Small Cell Siting

Andrew Afflerbach, PhD, PE
CEO & Director of Engineering

As the FCC and many state legislatures consider interfering with local processes regarding wireless facilities siting, I recently prepared a report for the Smart Communities Siting Coalition, addressing wireless siting and the critical importance of local process from a technical standpoint.

Among other things, my report describes and illustrates “small cell” infrastructure and discusses how the local oversight process addresses the concerns of the public sector that wireless facilities not compromise public safety, traffic, people with disabilities, and other communications.

Accommodating permitting and other local government requirements in public rights-of-way is typically a relatively small part of the cost and time required for design and construction of outside plant for a communications network, with only marginal impact on broadband investment decisions. Indeed, local permitting processes and fees have negligible impact on the decision to deploy broadband in urban versus rural areas. In fact, in our experience, the permitting process and local government coordination can help and facilitate deployment. When it is done effectively, it protects the integrity of existing infrastructure and public safety, and provides certainty and predictability to wireless carriers and wireless infrastructure companies.

In my own experience and in the experience of my colleagues at CTC, the optimal way to facilitate and smooth the wireless siting process is for wireless companies to work with localities by filing complete, accurate, timely siting applications—and by collaborating with the localities in an efficient, mutually-beneficial process of pre-planning, specification development, and reasonable staging of the deployment. In city after city and county after county, we have found that localities are highly motivated to facilitate and incentivize broadband build-out, and are willing to use permitting and other processes to enable and smooth the deployment process as much as possible.

Numerous localities are currently involved in creative efforts to understand private sector needs and to develop ways to work collaboratively. The next generation of wireless broadband deployment can best be achieved if wireless companies undertake a similarly collaborative, constructive engagement with localities.

The report was submitted to the FCC in the Mobilitie docket (WT docket 16-421) by the Smart Communities Siting Coalition. It can be found here.

Read more about Dr. Afflerbach here

Published: Monday, March 27, 2017 by CTC Technology & Energy



CTC President Joanne Hovis Testifies Before U.S. House Subcommittee: “Broadband: Deploying America’s 21st Century Infrastructure”

The following is CTC President Joanne Hovis’ testimony before the U.S. House of Representatives Committee on Energy and Commerce Subcommittee on Communications and Technology, “Broadband: Deploying America’s 21st Century Infrastructure” on March 21, 2017.

For the full hearing, visit the Energy and Commerce Committee’s website here.

A PDF copy of Ms. Hovis’ testimony can be downloaded here.

Broadband: Deploying America’s 21st Century Infrastructure

Chairman Blackburn, Ranking Member Doyle, and members of the Subcommittee, good morning and thank you for inviting me to testify today. My name is Joanne Hovis. I am the president of CTC Technology & Energy, an independent broadband technology and planning consultancy that supports public sector clients nationwide. I am also the CEO and co-founder of the Coalition for Local Internet Choice, a national organization that represents a wide range of public and private interests who support the authority of local communities to make broadband internet choices. I believe that local internet choice is critical to enabling broadband deployment and creating broadband competition, especially in unserved and underserved areas.

I am a member of the boards of directors of the Benton Foundation and the Fiber Broadband Association (formerly the Fiber-to-the-Home Council).

At CTC, I have developed business model analysis and strategy for some of the largest public-private broadband initiatives in the country. I lead the CTC teams that advised the states of Connecticut, Kansas, Kentucky, Maryland, Massachusetts, New Mexico, and New York; the cities of Atlanta, Boston, Palo Alto, San Francisco, Seattle, and Washington, D.C.; and many other public entities.

I focus in particular on broadband public–private partnerships (P3) that enable both public and private entities to benefit from public assets and private innovation and service delivery. Among my client engagements are the pioneering broadband P3s in the Commonwealth of Kentucky and the cities of Boulder, CO; Bloomington, IN; Madison, WI; Westminster, MD, and Huntsville, AL.

Deploying Broadband Will Require Federal Infrastructure Funding, Innovative New Approaches, and Partnerships

One of the hallmarks of President-elect Trump’s candidacy was a commitment to major infrastructure investment across the U.S. and to increasing the role of the private sector in such development through tax mechanisms and public–private partnerships.

Like electricity in the last century, high-capacity broadband internet access today is rapidly becoming the critical platform and driver of simultaneous progress in economic development and global competitiveness, education, health care, public safety, transportation, and much more. By working cooperatively with state and local governments, the private sector stands to benefit in multiple ways—as partners in designing, building, financing, and operating these advanced communications networks, as users of the networks to market their goods and services in the rapidly emerging information-based global economy, and as contributors to the next generation of innovations.

I make the case today for including broadband, particularly in rural areas, among the infrastructure categories in any infrastructure investment program, and recommend particular P3 and related mechanisms that can be included to increase the likelihood of the necessary capital flowing to the areas with the greatest needs.

Broadband Gaps Align with Lower Income Levels and Lower Population Densities—These Are the Areas that Would Benefit Most from Broadband P3s

Americans access the broadband internet over networks owned by phone companies, cable companies, and, in a few locations, competitors.

Broadband, like any other type of infrastructure, requires significant upfront capital for deployment of networks and services, and private capital will flow to areas where potential return is highest. In a number of densely-populated, higher-income areas, incumbent phone and cable companies have upgraded their networks to enable new services and high-speed internet access. A handful of these areas have also seen investments by new entrants seeking to outflank the incumbents in establishing 21st century broadband infrastructure.

In contrast, in less densely-populated areas and lower-income areas, the pace of progress has been much slower. Offering lower returns on private investment, these areas have seen their economies stagnate, their children move to more promising locations, their hopes for a better future ebb away. Fortunately, P3s and other collaborative public-private structures offer one promising solution.

Broadband Public–Private Partnerships Present Opportunities for Economic Benefit in Rural and Low-Income America

State and local governments are increasingly motivated to incent private sector investment in next generation broadband networks, with a focus on homes, businesses, and government users such as public safety. States and localities have experience, capabilities, and assets that enable them to build broadband infrastructure that can be made available to the private sector for competitive services and innovation, with the public entity building the infrastructure but uninvolved in the private sector role of operations and service delivery to the public. Alternatively, the state or locality can partner with the private sector for shared investment in private networks that secure public sector goals (such as service in rural areas that seek to maintain economic viability and enable such critical practices as home-based business and home-schooling).

Private sector users could include application developers and innovators in a range of areas (home-based education, transportation, public safety, health care, etc.) as well as broadband internet service providers (ISPs) and wireless companies seeking fiber backhaul for next-generation wireless such as 5G cellular.

To maximize this possibility, I will recommend in the next section creation of a series of P3 opportunities and financing support that will have the following positive effects on the deployment of both wired and wireless broadband:

  1. Increase investment in new broadband facilities by reducing borrowing costs for P3s.
  2. Stimulate development of a P3 market for broadband networks, which has been limited until now (despite the interest of private entities) because of the high cost of infrastructure deployment.
  3. Maximize use of existing public broadband assets by enabling states and localities to add to them, and then make them available to private sector ISPs.
  4. Create investment opportunity in areas that struggle to attract capital, particularly: (1) small business areas in both urban and rural areas that are chronically underserved with business-grade broadband, and (2) smaller, remote towns and rural areas that have suffered from chronic underinvestment with respect to private broadband infrastructure.
  5. Create broadband construction jobs. Construction of fiber optics and wireless towers has immediate, significant direct job creation benefit because the bulk of funding is for labor rather than materials.
  6. Support workforce education and development programs to prepare America’s workers to succeed and thrive in the emerging information-based global economy.


Even a combination of tax credits and P3s alone would be insufficient to attract investment to rural areas. All things being equal, investors will go to where the market is strongest, the returns are highest, and the revenues are likely to be most robust.

As a result, unless tax credits are geographically targeted, investors will not generally take the tax credits to rural parts of the country. Instead, investors will likely use the tax credits in markets, including through P3s, where the potential for substantial revenues is greatest – wellto-do, densely-populated areas.

This is both because the market and the asset type facilitate high revenues, and because the state or locality that sponsor the P3 will probably be capable of undertaking more significant public spending or public guarantees of the P3 private revenues than state or local entities in lower-income, sparsely populated areas. For this reason, based on my experience, I suggest that the strategies include some of the following recommendations to make the tax credits and P3s in rural areas more viable and more attractive to investors:

  1. Create financing support mechanism to reduce P3 borrowing costs. Create financing mechanisms that would reduce borrowing costs for states, localities, and private entities to build the infrastructure, thus making the P3s more viable at modest cost to the treasury. For example, federal contribution toward/reduction of interest costs would improve viability of P3 projects.
  2. Enable use of tax-free municipal bonds to fund public infrastructure in P3 environments or for lease to private ISPs, thus reducing municipal borrowing costs, enabling P3s, and increasing project viability at modest cost. Specifically, create exception to private use limitations for tax-free municipal bonds focused on funding broadband infrastructure that would be available for private use, or that would be managed by a private partner under a formal P3 structure. Allowing use of tax-free bonds for broadband infrastructure to be leased and/or operated by private ISPs is projected to greatly increase state/municipal interest in broadband P3s and in investment in assets for use by private entities.
  3. Enable transferability of tax benefits such that non-profits and public entities can sell tax credits or other tax opportunities on the market—thus making tax mechanisms more viable for areas that are of less interest for private capital. By way of analogy, the New Market Tax Credits program has had consistent bipartisan support for a similar approach focused on lower-income areas. This two decade-old, proven program allows investors in economic development infrastructure to sell their investment tax benefits on the market, thus realizing cash inflows that can help finance and support the project. This bipartisan program should be renewed and enlarged as a particularly efficient way of attracting private capital to areas that otherwise offer insufficient returns on investment.
  4. Carve out funding and other support for areas where the local economy has been impaired by technology change and globalization—and where broadband could have a disproportionate impact (relative to cost) on improving economic opportunity. Geographically-targeted incentives could include more robust funding or financial benefits for infrastructure investments in rural and low-income areas. Unfortunately, recent budget proposals go in the opposite direction. For example, President Trump’s budget proposal would exacerbate this issue by eliminating funding for two programs that have delivered measurable benefits in the areas of digital inclusion and broadband infrastructure. His budget would zero out both the Appalachian Regional Commission (ARC) and the Department of Commerce’s Economic Development Administration (EDA). As I discuss below, my experience working with the government of Garrett County, Maryland—which has received modest ARC funding for an innovative broadband public-private partnership project—illustrates the importance of programs such as these.
  5. Include mandatory Dig Once and construction efficiency strategies in other P3 projects, in order to capitalize on opportunities presented by construction in the rights-of-way— whether by government agencies, utilities, or private entities—to cost-effectively install fiber and conduit. For example, consider a P3 scenario for replacement of an aging municipal water system. The concessionaire could be required to simultaneously install conduit in all of the trenches dug to replace water mains and supply pipes, thus effectively constructing extensive broadband infrastructure at incremental cost. Dig Once is thus an enormous opportunity at the local level to create a multiplier effect on federal infrastructure funding.

Local Government Examples

At the moment, early actors are developing new and exciting partnerships to bring next-generation broadband to their communities. I describe some of those projects in the following brief case studies.

City of Westminster, Maryland

In this rural town, home to 20,000, a broadband P3 has emerged in which the city has invested to deploy fiber optics to every home and business—and then leased the fiber to a private ISP that committed to provide services. For small businesses, in particular, the new services have been transformative, as they previously had no Internet option above a few megabits per second.

Garrett County, Maryland

This remote Appalachian community has no broadband in some remote, mountainous areas. The county’s concern arose from citizen complaints that they could not home-school their children without adequate bandwidth to download home-schooling curricula, and could not telework or run home-based businesses without broadband.

The county developed a P3 to support the deployment of a fixed-wireless broadband network, currently under construction, that will serve up to 3,000 currently unserved homes. The private partner will match the public investment with its own capital and will assume operating risk. The county contribution (which was matched with development funds from the Appalachian Regional Commission) made the economics of this opportunity attractive to the private partner.

Huntsville, Alabama

In February 2016, the city of Huntsville, Alabama, the state’s northern technology hub, announced that its municipal electric utility will build a fiber network throughout its city limits (presumably, to pass all or most businesses and homes), and that Google Fiber will become the first lessee of some of that fiber in order to provide gigabit services to residences and small businesses.

As in Westminster, the Huntsville model puts the city in the business of building infrastructure, a business it knows well after a century of building roads, bridges, and utilities. The model leaves to the private sector (in this case, Google Fiber and any other provider that chooses to lease Huntsville fiber) all aspects of network operations, equipment provisioning, and service delivery.

Swift County, Minnesota

In one innovative, shared-risk project, a state grant and a county bond issuance have enabled a private company to deploy next-generation broadband in Swift County, a rural area in west central Minnesota that has a population of only 10 people per square mile.

Swift County is no exception when it comes to the economic challenges of deploying broadband in low population density areas.

With the active support and encouragement of the county, Federated Telephone Cooperative, a phone co-op in the region, applied for and won a grant with the State of Minnesota in 2015. (Set up to promote “border to border” broadband access, the state of Minnesota has a $35 million statewide grant program designed to help new and existing ISPs as they try to reach new customers in hard-to-reach areas.1 According to Minnesota’s Department of Employment and Economic Development, 25 percent of the state’s rural residents lack access to high-speed broadband.) Federated Telephone won the state’s largest award: $4.95 million. That amount pays for only 40 percent of the project’s projected cost, however, under the terms of the grant. The balance of the project’s $12.5 million total cost is funded by a loan from the county.

To launch the project, Swift County sold $7.8 million in general obligation bonds. Federated provided a $1 million cash security in the event of missed payments, and will repay the loan over 20 years.

The project is designed to expand broadband availability to 600 households, 425 businesses, and 75 community buildings.

RS Fiber Cooperative (Minnesota)

Construction of a new fiber optic network to residences and farms is underway in rural, south-central Minnesota thanks to a public-private partnership, called the RS Fiber Cooperative, and the state’s grant program. The network will eventually pass more than 6,200 potential customers across 10 cities and 17 townships. The network will be built in phases, with the first phase expected to cost $15 million. The state contributed $1 million to the effort through the rural broadband grant program, and the participating municipalities have financed the rest with $8.7 million in general obligation bonds, as well as additional bank loans. Once completed, the first phase of the network will allow the cooperative to offer better broadband than is currently available in the area using wireless transmitters. The cooperative will use the revenue it begins to generate to service the bonds and finance the construction of the last-mile portion of the fiber network.

State Government Example: Kentucky Wired

With eastern Kentucky losing coal jobs at an unprecedented rate, Kentucky developed a plan to use broadband to spur economic development. But Kentucky faced the same challenges found in rural communities across the country: Bringing high-speed internet to low-population density areas is an expensive prospect.

The solution is a statewide P3 that will connect 1,100 government entities into a 3,400-mile fiber optic backbone that will be made available to private sector ISPs for use and development. The selected concessionaire will build, maintain, and operate the network for 30 years.

KentuckyWired has been a bipartisan effort from the outset, and originated with U.S. Rep. Hal Rogers as an economic development initiative for replacing lost coal jobs. The program has been strongly supported by state elected officials of both parties, first by former Gov. Steve Beshear and, more recently, Gov. Matt Bevin.


Thank you for your consideration and the opportunity to appear before you today.

Published: Tuesday, March 21, 2017 by CTC Technology & Energy



Partnerships, Sharing, and Community Anchor Institution Broadband

Originally published by the Benton Foundation on behalf of Joanne Hovis on January 4, 2017.  The original post can be found by following this link.

The SHLB Coalition developed Connecting Anchor Institutions: A Broadband Action Plan to provide ideas and actionable policy recommendations for government leaders at the federal, state, and local levels to address the broadband needs of anchor institutions. The ten policy papers highlight connectivity gaps and explain why broadband access is vital to communities nationwide. In the coming weeks, the Benton Foundation will be highlighting each of the Action Plan policy papers. The following is an excerpt of the third paper. Be sure to register for Partnerships and Rural Broadband Needs, a webinar coming on January 10.


Partnerships, aggregation, and coordination in securing broadband services are valuable tools for community anchor institutions (CAIs). Aggregating buying power on a regional or statewide basis is a tested best practice that can enable anchor institutions to achieve lower per unit pricing, higher bandwidth, and improved service quality. Policymakers should encourage anchors to consider joint procurement and coordination with entities representing other anchor sectors in their state or region. Aggregated procurement also encourages broadband providers to collaborate and bid with other providers—which could flatten pricing and reduce geographical disparities.

The Aggregated Purchasing Model

Under the aggregated purchasing strategy, multiple anchors (such as school districts and/or libraries) on a regional or super-regional basis—or ideally, on a statewide basis with support of one or more state agencies—combine their request for proposal (RFP) processes to solicit and contract for Internet bandwidth and wide area network (WAN) connections, dark fiber, wavelengths, Ethernet, or any other service. (The RFP process established by the Federal Communications Commission (FCC) in its E-rate program is conducive to this model, but the strategy can also benefit CAIs that do not participate in E-rate.)

In this approach, the anchors cooperate to develop the joint RFP and select the vendor(s). Ideally, the buying group would be as large as possible and would include both rural and metropolitan-area anchors—thus enabling, on the one hand, rural communities to benefit from the substantial buying power of higher-volume urban districts and, on the other, enabling urban communities to benefit from the buying power afforded rural stakeholders by federal funding programs. Establishing a joint urban-rural consortium for the purchase of broadband services can also permit the CAIs to adopt a “postalized rate” pricing regime that allows rural CAIs to pay the same per-unit rate as the urban CAIs.

The FCC encourages consortium buying in both the E-rate program(1) (for schools and libraries) and in the Rural Healthcare program.(2) In the Rural Health Care Pilot program, originally adopted in 2007, the FCC found that “the flexible, consortium-based approach of the Pilot Program fostered a wide variety of health care broadband networks that enabled better care and lowered costs, . . . enabling smaller HCPs [health care providers] to draw on the medical and technical expertise and administrative resources of larger HCPs.” As a result, the FCC has directed the Universal Service Administrative Company (USAC) to prioritize consortium applications for expedited review in both the E-rate and Rural Healthcare programs.(3)

Statewide or Regional Procurement

Aggregated buying is a best practice that has also been utilized powerfully at the state and regional level. A large-scale state or regional procurement strategy can leverage the collective buying power of several anchor institutions, which together represent a massive customer for commercial service providers. Significant leadership and organization are necessary to implement aggregated buying, including convincing stakeholders at the local level to participate. But the challenge can be overcome by pointing out the significant cost benefits. These benefits include:

  • Lower per unit pricing across the full range of key services, including Internet bandwidth and WAN
  • transport costs;
  • Potential increased investment and improved services by private sector providers;
  • Reduced (per CAI) administrative and processing costs; and
  • Additional management expertise that could benefit participants with limited technology resources.

Lower Unit Pricing

An anchor institution, when acting alone, often is a relatively small purchaser, particularly in smaller communities in rural areas. Indeed, even if an anchor — such as a school district — is one of the bigger buyers in the region, it still has relatively modest buying power. Dramatically compounding this problem is the fact that, in many areas, there may be only a single broadband provider with the facilities to serve the anchors. As a result of the modest buying power and the effective lack of competition, rural and single anchors have little to no leverage to secure pricing comparable to that of larger buying groups or metropolitan area districts that may be fortunate enough to have slightly more competition.

In contrast, the aggregate of the communications purchases made by all anchors in a region or state is substantial—and in total likely represents one of the largest communications purchasing sectors in that area. Greater purchasing power can deliver better pricing because bidders offer lower per unit costs in order to secure the volume business opportunity.

The aggregated purchasing strategy is also likely to have positive impacts on commodity Internet bandwidth costs. The cost of bandwidth varies dramatically depending on location (i.e., it will be significantly less costly in Chicago or El Paso than in Peoria or Farmington) and the size of the total purchase (i.e., large bulk purchases of bandwidth will result in lower per-megabit costs than will smaller purchases). The ability of the broader anchor community to buy commodity bandwidth in bulk and then distribute it across a region or state to locations where it is needed can dramatically decrease the per-megabit price of that bandwidth.

Increased Private Sector Investment

The opportunity to realize more revenue and improve long-term business opportunities can convince commercial providers to make additional network investments to serve consortium purchasers. The scale enabled by large group buying is likely to create a business opportunity so appealing to the service provider community that it may organize itself to build additional fiber and offer improved services. Service providers may also offer certain benchmarks for service and upgrade service levels in order to win such a large opportunity.

The new E-rate rules, which explicitly allow E-rate funding for special construction and dark fiber, also present new opportunities for aggregate purchasing. The prospect of receiving substantial ongoing E-rate subsidy for services, and the opportunity to obtain upfront payment for network expansion (particularly for fiber construction), amplify the business opportunity for service providers.

The development of new infrastructure would serve not only the anchor customers, but also many other users in the surrounding area. Indeed, fiber built to currently unconnected anchors can serve as a “middle-mile bridge” into areas where the anchors are located—and then provide a means of extending service over time to business and residential customers. At the same time, the construction will have direct economic development benefits, as well as catalyzing long-term indirect benefits that flow from the new communications services.

Reduced Administrative and Processing Costs

Another significant benefit of regional, super-regional, or statewide procurement is lower (per anchor) net administrative costs, including RFP preparation, RFP review, contract negotiations, contract administration, invoice review and payments, and, very significantly, interaction with the E-rate administration. One of the E-rate program’s biggest challenges is the considerable administrative cost involved at the local level. While the FCC has made efforts to reduce the administrative burden, some of the components of the E-rate application process have become more complex as a result of the significant E-rate rule changes in the two E-rate orders adopted in 2014, particularly for “big-ticket” applications. Collaborative purchasing leads to the opportunity to share the costs of an E-rate consultant or consultants, thereby lowering administrative costs for all participants in the consortium.

Bringing Additional Resources to Help

Consortia applicants can also benefit from shared management and technological expertise. Either the purchasing cooperative itself, or service providers, can provide management services to help even out the technological skill and capacity of the membership. This benefits all members of the purchasing group in that it makes sure that all members are able to benefit evenly from the purchase, installation, and management of connectivity for their organization. This benefit is particularly important for rural CAIs that may not have the resources to hire engineering and legal support necessary to ensure the application meets all the criteria for approval.


  1. Federal Communications Commission, In the Matter of Modernizing the E-rate Program for Schools and Libraries, Report and Order and Further Notice of Proposed Rulemaking, WC Docket 13-184 (July 23, 2014) (“First E-rate Modernization Order”), ¶168. [The FCC stated, “Consortium purchasing can drive down the prices paid by schools and libraries for E-rate supported services. In this section, we reduce or eliminate some of the existing barriers to applicants’ participation in consortia.”]
  2. Federal Communications Commission, In the Matter of Rural Health Care Support Mechanism, Report and Order, WCDocket 02-60 (December 21, 2012) ¶50.
  3. First E-rate Modernization Order, ¶168.
Published: Monday, January 9, 2017 by CTC Technology & Energy



Maximizing the Potential Benefits of E-rate Special Construction Reimbursement in Light of Potential Program Changes

The changes in Washington DC in January, as a new presidential administration takes office, may bring changes to the E-rate program.[1] In brief, E-rate reimbursement for special construction charges may not survive through the incoming administration, and E-rate funding in general may be reduced. To hedge against these potential changes, public entities that can benefit from the E-rate program should act now to secure those benefits in the coming funding cycle.

This memo outlines the opportunities for E-rate reimbursement of fiber construction charges—and explains why both service recipients (school districts and library systems) and potential public sector service providers (like city and county governments) should act quickly to capitalize on the program in the next funding year.

Benefits of E-rate Special Construction Reimbursement

For schools and libraries, an E-rate procurement that includes investment in fiber optics can:

  • Ensure the long-term affordability of network connectivity required to meet growing broadband needs.
  • Hedge against potential increases in price in broadband services.
  • Help school and library facilities reach federal broadband connectivity goals as defined by the most recent E-rate modernization order.
  • Protect against potential reductions in, or elimination of, federal E-rate funding over time.

For local governments that serve their schools and libraries as an E-rate service provider, the special construction reimbursement can be a means to build out a public sector fiber network with significant federal funding. This assumes, of course, that the local government participates in the competitive bidding process (i.e., responds to the school or library’s E-rate RFP) and is selected as the winning, most cost-effective bidder to serve the schools or libraries. While the fiber strands built for the schools or libraries would be dedicated to that purpose, the locality could install additional strands of fiber at the small incremental cost of those materials.

In a similar way, the E-rate special construction reimbursement could create new competition in the local broadband market if the schools or libraries select a private provider to build fiber. In this scenario, as in the scenario in which the local government wins the competitive bidding process, the private provider, answering an eligible E-rate applicant’s bid for leased dark fiber or leased lit fiber, could add fiber strands in addition to the fiber it builds to connect schools. Then the private sector entity could use those additional strands to offer broadband services in the neighborhoods around the schools, and wherever else the fiber reaches.

Brief Overview of Approaches to E-rate Special Construction Reimbursement

The E-rate program provides financial assistance to schools and libraries to obtain affordable broadband. Eligible schools, libraries, and consortia of schools and libraries apply for E-rate support every funding year (July 1 through June 30).

Applicants (schools and libraries) are generally required to seek competitive bids for the services they seek to purchase using E-rate funds; the price of eligible products and services must be the primary factor in selecting the winning bid. City and county governments are eligible to bid and provide services to schools and libraries that utilize E-rate, much as private sector service providers are.[2]

In 2014, the FCC updated the E-rate rules for reimbursement of construction costs, known as special construction charges. The rule changes were designed to expand opportunities for E-rate applicants to select higher bandwidth lit services that may require the construction of new infrastructure by a service provider, or allow applicants to pursue other service options such as dark fiber IRUs and self-provisioning when traditional lit services are unavailable or not as cost-effective.

This E-rate capital funding offers an opportunity for school districts and library systems to enable the construction of fiber optics by the winning bidder of their broadband procurement, so long as the bid that includes the cost of construction is the most cost-effective bid (measured over some period of time that can be as long as 20 years or more).

E-Rate Bidding Process for Special Construction

In this scenario, the school or library system would issue an RFP under the E-rate rules for both “lit” services and for a long-term lease for “dark” fiber. The incumbent provider can bid on this RFP, as can competitors (including public sector competitors) that propose to build and own new fiber, subsidized by the E-rate program, and then to provide to the schools or libraries either lit communications services or a dark fiber lease for a period of time specified in the RFP. (The schools or libraries can then “light” the fiber with equipment funded under E-rate.)

Under the rules of the E-rate program, the winning bidder would be the one that offers the most cost-effective option, measured over a period of time selected by the school district or library system. If a bid to build fiber and then provide services or dark fiber would be more cost-effective than procurement of the same services from other providers, measured over the next, say, 20 years, then the E-rate program would fund construction of the fiber at the community’s standard E-rate discount rate.

In the scenario in which the applicant contracts for dark fiber (as opposed to lit services), it could procure a guaranteed long-term lease of 20 or more years. This approach would serve as a hedge against reduction or elimination of the E-rate program in the future, ensuring that the schools or libraries control sufficient fiber infrastructure to meet their needs at low cost into the far foreseeable future. We think particularly highly of this approach because it entails extremely low risk and relatively low effort for applicants—but gives them long-term security.

Construction of new fiber by the winning bidder enables a school district or library system to meet its own needs for advanced broadband services – and to simultaneously enable its provider to build new infrastructure that can serve as a base for deployment of new services to the public in the neighborhoods around the schools or libraries. (E-rate rules do not allow any fiber strands built with E-rate funding to be utilized for other purposes, but the winning bidder could pay the incremental materials cost to install excess fiber strands alongside the fiber dedicated to the schools or libraries.)

Act Now to Capitalize on Potential E-rate Funding Before Expected Changes to the Program

Based on the outcome of the presidential election and likely changes in leadership at the FCC, we believe that the next chairperson of the FCC will not be as committed to this fiber-based competitive model as is the current chair. Indeed, there is some risk that in the coming year or two, the FCC under new leadership could adjust its direction on special construction funding.

Even if the E-rate program does not see substantial changes in what can be funded, it is likely that that total amount of funding will be reduced. We anticipate an effort in the new administration to lower the cap on the E-rate program (which was raised quite substantially in recent years). If the cap is lowered, there may be insufficient funding for procurements that require special construction. The procurement cycle for the 2017-18 funding year, which will only partially overlap with the new administration, could thus be the last opportunity to seek reimbursement for fiber construction.

For this reason, we strongly recommend that schools and libraries seek to maximize the next E-rate funding year, the process for which has already begun for some districts (i.e., those that are planning their RFPs in advance of the FCC’s upcoming bidding window) and extends into the late spring for funding to begin July 1st.

We note, too, that there is benefit to testing this strategy even if the bids on dark fiber turn out not to be of interest to a school district or library system, or if the applicant chooses to accept a bid for lit services. (Under the E-rate rules, an applicant can test this strategy through an RFP process without being obligated to execute it.) Including the dark fiber option in an E-rate RFP increases the competitive pressure on existing vendors—often leading them to offer lower pricing for lit services. In this scenario, simply the potential for new competition emerging through the dark fiber procurement strategy could reduce a school district or library system’s costs for communications services.

[1] The term “E-rate” is the informal name for the Federal Communications Commission’s Schools and Libraries universal service program.

[2] If the eligible E-rate applicant is part of city or county government, the city or county government should make certain that there is a process of bid evaluation for the E-rate applicant that involves no conflicts with the city or county entity that submits the E-rate bid.  For example, the county IT director should not be part of the E-rate applicant’s bid evaluation process if the county IT department is the operator of the network which is proposed to serve the E-rate applicant’s broadband needs.

Published: Tuesday, January 3, 2017 by CTC Technology & Energy



How Localities Can Improve Wireless Service for the Public While Addressing Citizen Concerns

As demand for wireless data continues to grow, a diverse group of tower companies, wireless carriers, fiber companies, and neutral-host infrastructure providers such as Mobilitie and ExteNet are requesting attachment permits from city and county officials nationwide. The flood of requests and actual deployments is creating uncertainty and stress for local officials as the new technologies are proposed on poles, streetlights, and new structures in neighborhoods. Community members, too, are increasingly asking their local officials whether the new equipment is necessary—and whether there are alternative approaches that would reduce the impact on their neighborhoods.

The wireless carriers are investing billions of dollars to enhance their networks by adding antennas and interconnecting them with fiber. Through a process they refer to as “network densification,” the carriers will use a mix of traditional macro cell towers, distributed antenna system (DAS) networks, and small cells to reach individual customers—both on the move and in their businesses and homes.

Indeed, FCC Chairman Tom Wheeler, speaking at a recent CTIA conference, noted, “There are just over 200,000 cell towers in the U.S., but there may be millions of small cell sites in the 5G future.”(1)

Local communities will feel the impact of these new cellular installations, particularly because the antennas will need to be even closer to where people live and work. Local government decision-makers need to be aware of the rapid emergence of large-scale DAS and small cell wireless deployment in residential neighborhoods—and the potential opposition to those deployments from residents.

Understanding the Augmentation of Towers with Small Cells and DAS

Traditional Approach to Wireless Service

Cellular network designers have a goal of providing customers with coverage and high-speed access—in the areas where customers expect to use the service. Challenges to network designers include the range of performance of phones and wireless devices, the limited availability of radio frequency spectrum, the placement of the wireless transmission facilities with respect to the user, rapid growth in demand, and obstructions such as building walls and trees.

Historically, to support only voice and text, wireless providers installed 150- to 200-foot towers to serve users in a five-mile radius (for a total service area of 50 to 75 square miles). The industry regarded the tall tower approach to wireless deployment as a reliable and cost-effective way to address narrow-bandwidth cell phone voice applications.

The most common forms of cell tower deployment have been self-supporting towers and monopoles. Typically, three or more wireless carriers share a common structure, with each carrier installing separate multi-antenna arrays (or rings) at designated heights. A common area beneath the tower is used to house the electronic equipment and backup power for each carrier, often with each carrier having a separate building.

Figure 1 is a typical self-supporting tower with three service provider antennas. Figure 2 is an example of a monopole cell tower. In addition to the antennas used to provide wireless service to customers, both towers also have microwave antennas to link the sites to neighboring sites and connect with the backbone telephone network and Internet.  This connection can be provided either by a microwave or a cabled connection.  However, to support expanding future needs for broadband Internet, typically a fiber optic connection is needed.

Figure 1: Self -supporting Tower tower-1-fall-2016-newsletter

Figure 2: Monopole Tower


Evolution of Wireless Technology

Modern broadband 4G and future 5G technologies require substantially greater bandwidth and signal strength than voice and text.

Over the past decade, service providers have begun to augment tall tower deployment with neighborhood wireless transmission facilities—such as DAS and small cells—that have smaller coverage footprints. In the new distributed wireless architecture, broadband users communicate with localized access points, typically mounted at elevations of 20 to 30 feet above ground level. These neighborhood access sites target service areas with a radius of 250 to 300 feet from the access site.

The rapid increase in wireless data usage requires an increase in the overall capacity and functionality of local wireless networks. Initially, nationwide wireless carriers focused on the 700 MHz band. Commercial wireless carriers then began to address the growth by acquiring and activating spectrum in higher-frequency radio bands (1.9 GHz to 2.5 GHz and higher), and segmenting the coverage area of their access points to serve smaller areas, so that fewer users share the same spectrum. While the higher-frequency bands increase the capacity, they are also more susceptible to blockage from buildings, foliage and terrain and often have more limited range.

Wireless providers additionally propose to expand their transmission capacity by adding hundreds of megahertz in unlicensed spectrum (in the 2.4 and 5.8 GHz bands used by Wi-Fi) to augment the licensed spectrum that they hold. The FCC is currently evaluating alternatives for providing additional spectrum to further enhance the resources of the wireless industry, focusing its efforts across the 2.4 to 6.0 GHz spectrum, as well as submillimeter spectrum up to 80 GHz.

A wide range of innovations currently is included under the evolving category of “5G,”(2) offering the promise of improved transmission speeds and accompanying throughput by enhancing coding techniques; “beam forming;” spectrum band aggregation; and other technological advancements. But even with these technological enhancements, user demand for high-speed network access will potentially continue to exceed technology updates.

The industry sees smaller network segments and large numbers of DAS and small cell network access points situated close to the user as a pragmatic and cost-effective approach to enhancing the delivery of broadband services.

Deployment Options for Achieving Targeted Neighborhood-Area Coverage

Currently, the industry is focused on enhancing broadband delivery, particularly in urban and suburban markets with high concentrations of users in relatively small areas. DAS networks and small cell antennas are two of the most common technologies for filling in capacity and coverage gaps within carriers’ existing footprints. (That is, the DAS networks and small cells are typically not being used to expand the area covered; they add capacity in existing coverage areas, or fill in spotty coverage gaps in very targeted areas within a carrier’s current coverage area.)

Both DAS networks and small cells are pole-mounted installations smaller than the rings of traditional cellular antennas at large macro sites.  DAS network installations are typically the larger of the two types of installations, supporting multiple spectrum bands and multiple wireless carriers within the same structure. Small cells typically support only one wireless carrier and have a smaller physical size than a DAS installation.

Similar in appearance to telephone, cable-TV, or electrical devices mounted on utility poles, the DAS or small cell installations are installed 20 to 30 feet above ground on structures in the public right-of-way (ROW) such as utility poles, traffic lights, and streetlights—providing a reliable communications range of 200 to 300 feet from the mounting structure.

Figure 3 illustrates a typical neighborhood DAS deployment, with access points connected via fiber optics. (From the perspective of visual impact, a small cell antenna will look similar.) Access point locations are selected based on the availability of suitable mounting structures with the goal of delivering a uniform signal level to users throughout the service area.

Figure 3: DAS With Fiber Optic Cable Backhauldas-figure-fall-2016-newsletter

An alternative approach to linking DAS and small cell access points is to connect them wirelessly (Figure 4). Wireless interconnection (or “backhaul”) uses a separate wireless network to interconnect individual local access points to the service provider. This approach eliminates the cost and time required to bring fiber optics to the access point. At the top of each pole, another independent antenna connects the access point to a core aggregation site.

With a wireless backhaul approach, poles or other structures must support a wireless backhaul antenna that is higher on the pole than the DAS access point.

Additionally, in the wireless backhaul approach, the core aggregation site that communicates with each of the access points must be 100 to 120 feet above ground, substantially taller than the other access points.

Figure 4: DAS with Wireless Backhauldas-figure-2-fall-2016-newsletter

Key Technical Facts for Local Government Decision-makers

Our review of small cell and DAS technologies indicates that overall they share most of the following attributes:

  • Deployment is focused on existing structures in the public right-of-way such as utility poles, traffic lights and streetlights. Where necessary, the wireless provider replaces the existing light pole with a stronger light pole to accommodate the wireless access equipment, or otherwise reinforces the structure.
  • Systems utilize low power and high-frequency spectrum (1.9 GHz or higher) providing near-line-of-sight communications. Design coverage from an individual access site is typically 400 feet or less from the antenna and is consistent with the placement of future 5G equipment.
  • In many cases, the systems are installed to accommodate multiple wireless carriers utilizing common equipment.
  • The systems are typically not being deployed with the 800 MHz antennas and equipment wireless companies typically used for voice service
  • In a typical multi-dwelling, high-density, suburban environment the density of systems can be as high as 25 to 30 access points per square mile.
  • Typically, the antennas are installed 20 to 30 feet above ground level.
  • Wireless access points are interconnected to the wireless provider’s network through a fiber-optic or wireless backhaul network. Systems that use wireless backhaul typically require core consolidation antenna sites exceeding 100 feet in height, and wireless providers are frequently seeking to place these larger poles in the public right-of-way.

Understanding Wireless Carrier Business Planning and Strategies

It is important to understand that wireless carriers face significant challenges in the large-scale deployment of outdoor small cell antennas and DAS networks, and that these motivate the strategies and choices of wireless deployers:

  • Site acquisition,
  • Variation from locality to locality of planning and zoning laws, including those governing placement of antennas and enclosures on poles and in the ROW,
  • Provisioning fiber to and increasing power to poles and traffic lights, and
  • Fiber backhaul availability, including access to fiber in less competitive and rural markets.

One strategy that large Mobile Network Operators (MNO) like AT&T, Sprint, T-Mobile, and Verizon Wireless are using to address these challenges is to outsource their deployments to third parties.

This approach insulates the MNOs from some of the cost and risk associated with antenna deployment. For example, when MNOs do not apply directly to the local jurisdictions for the new infrastructure, they avoid municipal and public scrutiny over the applications and leave it to the third parties.

The outsourced companies include tower companies such as Crown Castle and American Tower; fiber operators such as Zayo, Lightower, Lumos, FiberLight, and Uniti Fiber; and “neutral host” infrastructure companies  like Mobilitie and ExteNet.

The companies building small cells and DAS know that there are often limited sites that are best suited for small cell attachment. As soon as they receive award for a small cell deployment from an MNO, some may “over permit” to lock up the attachable real estate. As the first to the site in many markets, an early over-permitter may create de facto monopolies and restrict future deployment and competition, leaving future MNOs to then find other means of deployment, or turn to an infrastructure operator already attached to the poles.

Infrastructure deployers are also pursuing policies and business arrangements that will streamline their buildout efforts, including:

  • Seeking blanket agreements for utilization of public-owned structures to reduce administrative hurdles and speed implementation,
  • Exploring partnerships with cities and/or technology companies on Smart City Internet of Things deployments, potentially providing wireless providers more access to structures such as light poles and street furniture, and
  • Asking federal and state governments to restrict and standardize local authority on use of ROW, and enact expedited timelines.

Impact on Local Governments and Their Citizens

MNOs and their infrastructure partners are calling for local governments to expedite approvals for new wireless facility siting—but the large-scale deployment of small cells and DAS is also causing concerns about aesthetics, safety, potential frequency interference, and how future modifications to those structures can amplify those problems in the future. Expedited approval timelines can limit a locality’s ability to properly review an application, or to consider the potential future impact of a siting.

We anticipate that the wireless industry’s large scale deployment of small cells and DAS will have a significant impact on local governments in the following areas:

  • Administrative burden – Municipalities generally are prepared to deal with a small number of tower requests each year, but many localities may potentially receive hundreds of new applications at once as deployments begin. Additionally, under the FCC’s rules, all applications must be reviewed and acted on within 90 days (for modifications to existing sites) or 180 days (for new towers).
  • Aesthetics – The increase in applications for small cells, DAS networks, and other antennas means that neighborhoods could have a high density of antennas and cabinets. In neighborhoods without utility poles, antennas will need to be placed on streetlights or on new poles.  If a deployer is using wireless backhaul technology, it may seek to place a 100 to 120-foot tall tower in a residential neighborhood.
  • Support for internal communications – With the industry’s aggressive deployment, some municipalities may face future challenges in finding places to mount radios for their own public safety needs or Smart City deployments. As new fiber is placed to support fiber-to-the-tower deployments, there will be less space on utility poles for other communications uses, including municipal Smart City infrastructure.

If a locality is educated and prepared to respond, it can negotiate from a position of strength. There are opportunities for local governments to actively shape the future visual appeal of their neighborhoods while still ensuring that the community is equipped with the technology needed to enable Smart City planning and meet the wireless needs of residents and businesses.

Locality strategies for managing small cell and DAS buildout might include:

  • Limiting in advance how many poles a single deployer can use (perhaps one out of four),
  • Requiring the use of existing poles or the replacement of those poles with poles that visually resemble the existing poles, or
  • Sharply restricting or banning exceptionally tall poles in residential rights-of-way.

Wireless deployments may create opportunities for public–private partnerships.  These include:

  • A locality working with a deployer to build a Wi-Fi network in public gathering places such as parks, shopping districts and downtown business centers in return for the use of City fixtures and assets, (3)
  • A wireless deployer and a locality to reducing costs by jointly building fiber,
  • A wireless deployer buying or leasing existing locality fiber instead of building new fiber, or
  • A locality and a wireless deployer working together on wireless deployment for Smart City applications.

What Localities Can Do to Facilitate and Manage Small Cell, DAS, and 5G Deployment

Local governments have a dual role in the expansion of wireless facilities and services in their communities. They want to actively support the expansion of high-quality wireless services for their residents and local businesses, but they also must address citizen concerns related to deployment of new wireless facilities.

In addition, localities must perform these roles under tight time constraints imposed by the FCC’s “shot clock” for reviewing and approving the industry’s applications for co-locations and new facilities.

In our experience as wireless facility advisers to local governments, we have found that localities can take steps to facilitate and enable the process, such that the needs of the carriers and the needs of the community are addressed. If local governments perform their roles in a structured and organized fashion, there is predictability around the process for both the carriers and the community—and the process is more likely to fit within the timeframe established by the FCC.

Among the steps that localities can take to enable due consideration of community concerns while providing a predictable filing experience for carriers are:

  • Ensuring that a carrier or third-party entity that seeks to install wireless infrastructure has the proper authority to operate the equipment. That authority might be granted by a Public Service Commission, another applicable state authority, or the Federal Communications Commission (which licenses the use of some radio frequencies).
  • Enacting zoning requirements to regulate wireless facilities in residential areas. Zoning might consider whether a facility is speculative (and could deny an application that does not identify a cellular carrier for which the antennas will be installed), whether an antenna is proposed for attachment to an existing structure or if a new structure will be constructed, and whether the proposed facility meets established height limits and setback requirements. Zoning might also distinguish between DAS and small cell antennas.
  • Managing the public rights-of-way by reviewing applications for licensing/permitting, structural issues, placement of facilities to minimize community impact, acceptable results of RF emission studies, and compliance with national codes (NEC, NESC) and pole owners’ attachment requirements.
  • Evaluating the community impact of proposed small cell and DAS installations with the same focus as traditional towers and antenna siting. Once approved, structures are subject to federal law for co-location—which could permit a co-locator to increase a facility’s height by up to 10 percent or 20 feet, whichever is greater, without local approval.
  • Establishing a community notification process to require carriers to notify residents of upcoming applications in their neighborhoods.

These recommendations may form pillars of a locality process. In order to manage these challenges and opportunities, we recommend that localities continue to become educated, share knowledge and experiences, and stay informed and active as discussions occur at the state and federal level.


(1) “Remarks of FCC Chairman Tom Wheeler,” CTIA Super Mobility Show 2016, Las Vegas, September 7, 2016,

(2) Technologies in the “5G” category include upcoming releases of 4G LTE technology known as “LTE-Advanced” as well as submillimeter high-frequency technologies providing line-of-sight communications, typically over very short ranges.

(3) One example is Sprint’s collaboration with the City of Kansas City and Cisco Systems, placing free Wi-Fi for the public in downtown areas and parks,

Published: Thursday, December 1, 2016 by CTC Technology & Energy



Community Anchor Institutions Served by Government and Non-Profit Fiber Networks

The SHLB Coalition developed Connecting Anchor Institutions: A Broadband Action Plan to provide ideas and actionable policy recommendations for government leaders at the federal, state, and local levels to address the broadband needs of anchor institutions. The ten policy papers highlight connectivity gaps and explain why broadband access is vital to communities nationwide. In the coming weeks, the Benton Foundation will be highlighting each of the Action Plan policy papers. The following is an excerpt of the sixth paper. Later this month, we’ll be looking at government funding of networks. To read the complete Broadband Action Plan, visit

Community Anchor Institutions Served by Government and Non-Profit Fiber Networks


State and local governments have been providing anchor institutions with high-speed data connections using fiber-optic networks for several decades. Indeed, tens of thousands of schools, libraries, community centers, and public health and safety providers obtain their broadband connectivity from local government and state non-profit networks, including state research and education networks. Policymakers should strongly consider developing or augmenting their municipal or statewide governmental or non-profit networks to ensure that their anchor institutions have the highest-quality broadband connectivity, to establish a foundation for economic growth, and to meet fundamental societal needs.
Government and non-profit anchor networks generally do not require short-term profits and, in most cases, can focus on long-term and community-based goals. These networks enable anchors to benefit from high bandwidth and reliability at reasonable per-unit pricing. These networks also benefit the private sector; many anchor networks lease excess capacity to and from commercial providers. While some criticize municipal broadband providers that serve residential customers, there are very few objections to networks that focus on serving anchor institutions.

Addressing the Unmet Needs of Government Agencies and Anchor Institutions

Anchor institutions often cannot afford to purchase high-capacity circuits from the private sector; rather, anchors simply cap their bandwidth and choose not to deploy applications that require high bandwidth. In other cases, high bandwidth capacity is just not available to anchor institutions at any price because the commercial carriers have not deployed the required infrastructure in that region.

Fiber-Based Networks Offer Affordable Scaling as Needs Grow

Fiber-optic networks have a useful life of decades because the capacity can be upgraded simply by changing the electronics at the end of the fiber. These networks are capable of supporting greater speeds and bandwidths as anchor institution needs and applications grow. Anchor networks commonly upgrade any one of their backbone fiber pairs to hundreds of gigabits per second – which is often faster than available commercial service offerings. Further, government and non-profit anchor networks often offer increases in capacity at little or no increase in recurring costs to the anchor because of how they typically structure their cost recovery models. Cost savings from aggregating traffic from multiple users sharing the
same network are passed along in the form of lower prices to all users, including the anchor institutions.

The Efficiencies of Shared Construction

Many of the government anchor networks in operation were built through the economically-efficient mechanism of shared construction, in which agencies and organizations agree to build cooperatively and simultaneously.

A Platform for Last Mile Deployment to Homes and Businesses

Local government and non-profit anchor networks often realize yet another key efficiency – these networks also can serve as an open platform for last mile deployment, both public and private. By their nature, most government networks to anchor institutions will reach deep into neighborhoods that house schools, libraries, public health offices, and government facilities such as water towers and fire stations. Many localities then lease excess capacity to private sector providers to enable service provision and last-mile build-out in the neighborhoods. This trend is fast accelerating as hundreds of localities make available spare fiber optic capacity to private carriers at rates designed to catalyze new private sector investment and opportunity.(1)

Strategies to Finance Government Anchor Networks

There are several strategies local and state governments have used to finance anchor networks. Where there is sufficient leeway in the general fund, governments can appropriate funds to cover the necessary initial capital expenditure, either on a one-time or multi-year basis. If there is not sufficient leeway in the general fund, a number of municipalities have used general obligation bonds, revenue bonds, or certificates of participation to finance the network build-out.

While these financing strategies do come at a cost, the lack of a high-capacity anchor network can pose a greater threat to the community’s long-term financial situation. Government agencies’ and anchor institutions’ demand for bandwidth will continue to grow in the coming years. Failing to invest in high-capacity broadband can impede the community’s economic growth.

Anchor networks tend to have a relatively modest payback period, with the initial investment often being offset through avoided costs in roughly 3-10 years. This holds true even when bonds are used to finance the network build-out, taking into account the cost of servicing the debt.

Once constructed, there will also be ongoing operational costs associated with maintaining the network. Often, the network manager charges agencies and anchor institutions fees for their use of the network that are limited to the actual operational costs. Most networks have been able to reach financial self-sufficiency while charging agencies far less than a private carrier would charge for comparable services.

There is also growing interest among private financial institutions willing to invest in municipal networks. Local governments may be able to find alternative means of financing government anchor networks using private capital.

Addressing Criticism of Municipal Networks

Despite numerous examples of successful municipal networks providing broadband services on a wholesale or retail basis,(2) some critics argue that such networks unfairly compete with private industry and can pose a risk to taxpayers. While much of the criticism is unfounded and based on factual errors,10 these criticisms are largely irrelevant to anchor networks. Very few of the critics of municipal retail and wholesale networks argue against municipalities’ right to own and operate a network to meet their agencies’ internal needs. Commercial companies generally do not question anchor institution networks in part because these networks are analogous to private, corporate networks that are usually provisioned by commercial companies.


  1. The value of shared construction and open access and interconnection policies are also addressed in Promoting Competition for Broadband Servicesin this Action Plan.
  2. See, for example, Andrew Cohill, “Danville Transforms its Economy with Fiber,” Broadband Communities Magazine (November 2011); Jon Brodkin, “Where Broadband is a Utility, 100Mbps costs just $40 a month,” ars technica (August 4, 2015); Todd O’Boyle and Christopher Mitchell, Carolina’s Connected Community: Wilson Gives Greenlight to Fast Internet, Institute for Local Self-Reliance and Common Cause (December 2012)
Published: Wednesday, November 2, 2016 by CTC Technology & Energy



Kentucky Reaffirms Bipartisan Support of Public-Private Partnerships for State Broadband

Last Friday brought strong validation of bipartisan public-private partnerships in broadband when Gov. Matt Bevin and Congressman Hal Rogers affirmed their complete support for the KentuckyWired project. The Governor and Congressman announced that Governor Bevin, a Republican, will move forward with KentuckyWired as was planned by his predecessor, Democratic former-governor Steve Beshear.

KentuckyWired is a public-private partnership between the Commonwealth of Kentucky and private-sector broadband providers and financiers, with a goal of building more than 3,000 miles of fiber optic cable across the state.

This new fiber will connect more than 1,000 government and education sites while simultaneously offering cost-effective, open access to last-mile Internet Service Providers to enable them to reach new markets and build in the last mile.

We’ve written about this project as well as CTC’s involvement with it in the past. And you can read about some recognition KentuckyWired received when the Bond Buyer magazine called it the “Deal of the Year”.

But we wanted to take a momentum to really appreciate the significance of last week’s press conference, in which Gov. Bevin and Rep. Rogers affirmed their support for the initiative.

Historically, state broadband planning has suffered from significant partisanship that has limited forward momentum—and resulted in highly-partisan legislation that limits the emergence of new networks and services. So it’s no small thing to see representatives of both parties recognize the importance of providing access to adequate bandwidth to support the continued growth and survival of communities where market forces alone have left them inadequately connected.

Kentucky has established a model for the country, both technically—with respect to how they’ve structured their program—and politically—with respect to how they’re putting politics aside to do what’s best for economic and community development.

All of us at CTC salute the many great people in Kentucky, in administrations past and present, who have worked so hard to make the dream of better connecting their citizens a reality.

Kentucky should be an inspiration for not letting partisan bickering prevent the progress that our communities so desperately need to get connected to the digital economy.

And we are now more hopeful than ever that public-private partnerships hold the potential to be the kind of non-partisan solution that can help get more communities to the foundational infrastructure of our century—broadband.

Published: Wednesday, September 21, 2016 by Geoff Daily