WORK SESSION AGENDA REQUEST

Sponsor:

Board of Supervisors Meeting Date: 

Paul S McCulla, County Administrator

April 9, 2009

Staff Lead:

Department: 

Paul S. McCulla, County Administrator

County Administration

Topic: 

A Work Session to Discuss Rural Broadband Deployment

Topic Description:

 

Background

Fauquier County government estimates that approximately 60% of county residents live in un-served or under-served areas of the community as it relates to broadband coverage. In the next eighteen months significant new federal funding will be available through the American Recovery and Reinvestment Act of 2009 (ARRA) to assist localities with the expansion of broadband services.  Federal funding opportunities include but are not limited to $4.7 billion in grants through the U.S. Commerce Department’s National Telecommunications and Information Administration to develop and expand broadband communication services in rural and under-served areas and improve access to broadband by public safety agencies and $2.5 billion in loans, grants and loan guarantees through the U.S. Department of Agriculture’s Rural Utility Services Program to provide and improve access to broadband service in un-served and under-served areas.

It is anticipated that the first of three rounds of grant applications for these programs will take place between April and June of 2009. As of this date application materials and due dates have not been released, however it is anticipated that each program will be highly competitive and applicants will be required to move very quickly to make application once the application processes have been finalized. In order to maximize the County’s competitive position and insure strategic alignment with the Board of Supervisors objective(s) for broadband deployment staff is requesting guidance from the Board with regard to key outcome identification as well as direction with regard to the role the Board wishes the County government to take with regard to broadband deployment. The staff will utilize the direction provided by the Board to develop a detailed action plan to achieve the Board’s articulated objective(s).

Alternatives Analysis 

There are a number of alternatives the Board may wish to consider to achieve its objective(s) for rural broadband deployment.  Staff has identified four models that represent the continuum of the County’s potential role in broadband deployment.  Review of and selection of an alternative should reflect the County’s objectives, desired timeline for completion, risk tolerance, anticipated financial support and desired short and long term governmental role. 

1.      Free Market Model. Under this model the County government would have no direct role in broadband deployment beyond the necessary regulatory role for approving towers/antennae under the Zoning Ordinance. Any application for stimulus funding would be by the private sector and decisions regarding service areas and timelines for deployment would be made by the private sector. With this option the County would have no direct role in implementation or operation, and no financial or other risk.

2.      Existing Assets Model:  Under this model the County would make its existing resources including vertical assets and land available through a competitive lease arrangement to one or more private vendors who would install equipment and operate broadband service. Any stimulus funding application would likely be made by the private sector. The lease of existing County resources would provide a potential revenue stream for the County while at the same time accelerate private sector broadband deployment. This model is most similar to the County’s existing approach, though the recent efforts have focused on vertical assets rather than ground leases. As with the Free Market Model decisions regarding areas of deployment and timeline would be made primarily by the private sector, however the County would have the ability to influence these decisions through the competitive lease process.

3.      Expanded Assets Model:  Under this model the County would use a propagation study, as completed by a firm procured through a competitive negotiation process, to determine where additional assets such as towers would need to be constructed to achieve the County’s coverage objectives and construct the improvements utilizing ARRA funds. These new assets would be competitively leased to one or more private sector providers who would utilize their equipment to provide broadband services in the coverage area. The County would be the applicant for stimulus funding for the infrastructure it would construct and would maintain ownership of the capital assets. The County would use the lease revenue to offset all or a portion of its grant match requirements and/or loan obligations as well as ongoing maintenance requirements. Under this model the County’s potential financial obligations increase but so too does the County’s ability to speed deployment in areas where exiting capital infrastructure does not exist.

4.      Full System Ownership Model:  Under this model the County would establish a Wireless Service Authority for the un-served and under-served areas of the county. Utilizing the authority provided under The Virginia Wireless Authority Act the County would have wide discretion to own and operate a system including the ability to partner with the private sector for deployment, operation and maintenance. Attached please find a document entitled “Wireless Service Authorities and the Virginia Wireless Authority Act” prepared by Jeffrey Gore of Hefty and Wiley which provides detailed information regarding the Act, as well as a comparison of the powers of wireless service authorities, economic developments authorities, local governing bodies and water/waste authorities.

The establishment of an Authority, which can be comprised of the members of the Board of Supervisors, is the most flexible means available to Virginia localities for broadband deployment. As this model might be applied in Fauquier County, the County could team with a private sector partner who would provide the propagation maps, engineering, grant match and specify and install the network equipment in exchange for a long term operating agreement with the Authority. Under this model the Authority would be the stimulus grant applicant and would continue to maintain the ownership of the network. Should the Board chose option 3 or 4 the Authority would be in the best position to actively pursue and implement the Board’s overall objective(s) for community broadband deployment as the Act provides the Authority with powers such as the ability to own and operate a broadband network and use of state-controlled lands that are not available to local governments generally. The principle cautions include the assumption of a new proactive government role in what had up to now been a private sector service, impacts on current staff and the customer service expectations of citizens served through the Authority-owned network even if it is operated by a private provider.

Once the objective(s) articulated by the Board is established and direction is provided regarding the most appropriate model for County government involvement in broadband deployment staff will develop and present for the Board’s consideration and approval an action plan to achieve the Board’s objective(s).  As part of this process staff also anticipates that a staff level working group of Planning, Information Technology, Economic Development staff and one or more private sector broadband providers currently operating in the County be established to review the County Zoning Ordinance pertaining to infrastructure approval for broadband deployment.

Additional items of consideration as the County moves forward to achieve the Board of Supervisors objectives include:

  • Any application the County may make for stimulus funding will require at a minimum a cost study by coverage area, engineering plan and build out schedule. Unless provided by a vendor as part of a procurement process, the County will need to allocate time and resources to complete these requirements.
  • Generally speaking the greater the level of County involvement the larger the area of deployment and more aggressive the timeline for completion; however with a greater level of involvement the County also will have greater financial and staff support requirements.
  • The County may wish to consider enhancing the competitiveness of future grant applications through a regional partnership with one or more of Fauquier’s incorporated towns.
  • The County should consider whether future procurement or leasing efforts associated with options 2-4 should focus on a single private sector partner or one or more sub-area partners.
  • Long term success of any public-private partnership, if options 3 or 4 are chosen, depends upon the selection of private sector partner(s) with the demonstrated ability to handle customer service support, system installation and maintenance.

 

Requested Action of the Board of Supervisors: 

Staff requests guidance from the Board of Supervisors with regard to key outcome identification as well as direction with regard to the role the Board wishes the County government to take with regard to broadband deployment.

 

Financial Impacts Analysis:

A fiscal impact analysis will be completed as part of the action plan development. This plan will be presented to the Board of Supervisors at a follow-up work session. Generally, the models are presented in order from least to most impactive on staff and financial resources.

Identify any other Departments, Organizations or Individuals that would be affected by this request:

Department of Information Technology
Finance Department
Department of Economic Development
Budget Office

Attachments:

Wireless Service Authorities and the Virginia Wireless Service Authority Act” by Jeffrey Gore of Hefty and Wiley, P.C.

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