For the Press

Natchez Trace EPA gets second grant for pilot broadband project

HOUSTON -- Natchez Trace Electric Power Association recently received $417,209 in a second round of funding from the Mississippi Electric Cooperatives Broadband Covid-19 grant program, Natchez Trace General Manager Shawn Edmondson said last week.

Natchez Trace EPA was awarded $3.9 million in state grant money earlier this year.

Both grants will finance approximately half the cost of a broadband pilot project in the Eupora area. Work on that project begins this week, Edmondson said.

Both grants require equal amounts of matching money. The EPA plans to borrow the matching funds, Natchez Trace officials said.

The grants will pay for stringing about 340 miles of fiber and make it available to about 2,292 eligible business and residential locations, which now lack service in and around Eupora in Webster County. Both grants require that the project be operational by the end of the year.

“We hope to have about 170 miles of that amount done, and to be serving 180 customers in that area, by the end of the year,” Edmondson said.

The broadband services to be provided must provide symmetrical speeds of 100 mbps upload and download to locations in the pilot project area.

“We’ve already signed a project management agreement with Conexon, which is a telecom engineering and consulting firm working with other electrical power associations across the nation, and we’re in the process of securing materials vendors and other contractors in connection with the Eupora project. We’ve also contracted with an engineering firm to do a pole to pole survey to determine which areas are most ready for us to begin to hang fiber,” the general manager said.

“With assistance from Conexon and direction from the Mississippi Public Utility Staff, we determined that the area with the least amount of competition and therefore the most need is Eupora and the surrounding area.

“The Eupora broadband project will be installed by contractors. Therefore, our electric members will still be taken care of by our electric employees,” Edmondson said.

The purpose of this pilot project is to determine if there is enough member interest, i.e. subscribers, to make a larger, system-wide broadband deployment feasible.

The nine-member NTEPA board has not yet made a final decision on offering broadband across its entire service area, which includes parts of seven counties. The board is expected to make that decision after the Rural Digital Opportunity Fund FCC (Federal Communications Commission) Reverse Auction later this year, NTEPA officials said this week.

“That vote will depend on how much money we could receive from the reverse auction, and a host of other questions,” Edmondson said.

The board voted earlier this year to form a broadband subsidiary. They did that because if NTEPA receives any funds in the reverse auction, they cannot accept those funds. The money must go to the organization that is to install the broadband, and that is the broadband subsidiary.

“A systemwide broadband project is a scary proposition, because it involves a lot of unknowns and a lot of money. Every county we serve except for Pontotoc is losing population. This is an opportunity to try to stem and reverse that decline. If something isn’t done young people leaving high school and college will continue to leave this area due to lack of broadband access,” Edmondson said.

Surveys sent out to members earlier this year, asking whether they favor NTEPA development of a broadband system across the NTEPA service area drew a response of about 25 percent. Much of the limited response seemed marginally favorable.

“We sent out close to 12,000 surveys, and got back about 2,800 responses by May 1. That deadline was extended from the original March 6 deadline due to member requests. Of those, about 1,600 members said they wanted broadband service. The main reasons given were wanting better Internet service -- either people didn’t have it or they weren’t satisfied with their providers.

“Of those who didn’t want the service, the main reasons were either customers were happy with what they had, or getting the service would cost too much money,” Edmondson said.

NTEPA board members will evaluate the survey’s findings, then make a final decision “when we know how much money we will receive from the auction,” he said.

The survey results will help NTEPA be sure members want the project before proceeding on it. NTEPA would have to borrow about $38 million -- the average cost among three feasibility studies done by NTEPA -- to build the system.

The cost of the project would depend on how many customers per mile take the service. The more customers per mile, the greater the cost per mile. The cost is greater when more customers are added due to the equipment per household.

A project of that magnitude would only be successful “if a majority of our membership expresses interest,” Edmondson has said previously.

If enough customers want the services, NTEPA will seek to cover the project’s costs by grants -- to be offered at the FCC reverse auction -- but there’s no guarantee they’ll get them.

Rates would not automatically go up if NTEPA does opt to offer broadband. If NTEPA gets enough Internet subscribers, the broadband subsidiary would cover the cost of the debt the association would take on for providing the service.

If there aren’t enough Internet subscribers, however, raising electric rates will be the only way to cover the cost of the debt. If rates go up, they will rise for everyone, not just those who voted to offer the Internet service.

“We’ll develop a bid strategy with Conexon and Conexon will employ that strategy in the FCC auction to see what we can get for federal grants. We don’t know how long it will be after that before we find out what we could get,” Edmondson said this week.

The bid strategy “is basically a game plan as to how much federal dollars we’d need to set up a working broadband system and in which census block groups we will bid for those funds. The FCC will distribute the $16 billion 1st round funding by census block groups,” the general manager said.

According to Internet sources, a census block is the smallest geographic unit used by the United States Census Bureau for tabulation of 100-percent data (data collected from all houses, rather than a sample of houses).

Blocks are typically bounded by roads and highways, town/city/county/state boundaries, creeks and rivers. In cities, a census block may correspond to a city block, but in rural areas where there are fewer roads, blocks may be delimited by other features such as political boundaries, rivers and other natural features, as well as parks and similar facilities.

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