[House Hearing, 117 Congress]
[From the U.S. Government Publishing Office]
SUPPORTING SMALL ENTITIES THROUGH
INVESTMENTS IN THE NATIONAL INFRASTRUC-
TURE: BROADBAND
=======================================================================
HEARING
BEFORE THE
SUBCOMMITTEE ON UNDERSERVED,
AGRICULTURAL, AND RURAL DEVELOPMENT
OF THE
COMMITTEE ON SMALL BUSINESS
UNITED STATES
HOUSE OF REPRESENTATIVES
ONE HUNDRED SEVENTEENTH CONGRESS
FIRST SESSION
__________
HEARING HELD
JUNE 16, 2021
__________
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
Small Business Committee Document Number 117-019
Available via the GPO Website: www.govinfo.gov
__________
U.S. GOVERNMENT PUBLISHING OFFICE
44-823 WASHINGTON : 2021
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HOUSE COMMITTEE ON SMALL BUSINESS
NYDIA VELAZQUEZ, New York, Chairwoman
JARED GOLDEN, Maine
JASON CROW, Colorado
SHARICE DAVIDS, Kansas
KWEISI MFUME, Maryland
DEAN PHILLIPS, Minnesota
MARIE NEWMAN, Illinois
CAROLYN BOURDEAUX, Georgia
TROY CARTER, Louisiana
JUDY CHU, California
DWIGHT EVANS, Pennsylvania
ANTONIO DELGADO, New York
CHRISSY HOULAHAN, Pennsylvania
ANDY KIM, New Jersey
ANGIE CRAIG, Minnesota
BLAINE LUETKEMEYER, Missouri, Ranking Member
ROGER WILLIAMS, Texas
JIM HAGEDORN, Minnesota
PETE STAUBER, Minnesota
DAN MEUSER, Pennsylvania
CLAUDIA TENNEY, New York
ANDREW GARBARINO, New York
YOUNG KIM, California
BETH VAN DUYNE, Texas
BYRON DONALDS, Florida
MARIA SALAZAR, Florida
SCOTT FITZGERALD, Wisconsin
Melissa Jung, Majority Staff Director
Ellen Harrington, Majority Deputy Staff Director
David Planning, Staff Director
C O N T E N T S
OPENING STATEMENTS
Page
Hon. Jared Golden................................................ 1
Hon. Jim Hagedorn................................................ 2
WITNESSES
Ms. Peggy Schaffer, Executive Director, ConnectMaine Authority,
Augusta, ME.................................................... 5
Mr. Dan Sullivan, President, Downeast Broadband Utility, Calais,
ME............................................................. 6
Mr. Matt Dunne, Founder and Executive Director, Center on Rural
Innovation, Hartland, VT....................................... 9
Mr. Tim Waibel, President, Minnesota Corn Growers Association,
Burnsville, MN................................................. 10
APPENDIX
Prepared Statements:
Ms. Peggy Schaffer, Executive Director, ConnectMaine
Authority, Augusta, ME..................................... 30
Mr. Dan Sullivan, President, Downeast Broadband Utility,
Calais, ME................................................. 37
Mr. Matt Dunne, Founder and Executive Director, Center on
Rural Innovation, Hartland, VT............................. 46
Mr. Tim Waibel, President, Minnesota Corn Growers
Association, Burnsville, MN................................ 54
Questions for the Record:
None.
Answers for the Record:
None.
Additional Material for the Record:
Missouri Farm Bureau Federation.............................. 60
SBE - Small Business & Entrepreneurship Council.............. 62
Statement of Ranking Member Jim Hagedorn..................... 65
SUPPORTING SMALL ENTITIES THROUGH
INVESTMENTS IN THE NATIONAL INFRASTRUCTURE: BROADBAND
----------
WEDNESDAY, JUNE 16, 2021
House of Representatives,
Committee on Small Business,
Subcommittee on Underserved,
Agricultural, and Rural Business Development,
Washington, DC.
The Subcommittee met, pursuant to call, at 10:00 a.m., in
Room 2360, Rayburn House Office Building, Hon. Jared Golden
[chairman of the Subcommittee] presiding.
Present: Representatives Golden, Carter, Delgado,
Luetkemeyer, Williams, Hagedorn, Stauber, Tenney, and Salazar.
Chairman GOLDEN. Good morning. I call this hearing to
order.
Without objection, the Chair is authorized to declare a
recess at any time. Let me begin by saying standing House
Committee rules and practice continue to apply during hybrid
proceedings. All members are reminded that they are expected to
adhere to these standing rules, including decorum. House
regulations require members to be visible through a video
connection throughout the proceedings so please keep your
cameras on. Also, please remember to remain muted, unless you
are recognized, in order to minimize background noise. And if
you have to participate in another proceeding, please exit this
one and log back in later.
In the event a member encounters technical issues that
prevent them from being recognized for their questioning, I
will move to the next available member of the same party, and
we will recognize that member at the next appropriate time
slot, provided they return to the proceeding.
For those members and staff physically present in the
committee room today, we will continue to follow the most
recent OAP guidance. Masks are no longer required in our
meeting space for Members and staff who are vaccinated. All
Members and staff who have not been are asked to wear masks and
socially distance. I sincerely hope we all do our part to
protect each other and our staff.
In 2020, COVID-19 widened the digital divide and
highlighted the importance of reliable and affordable broadband
for American small businesses. Many small businesses shifted
operations online to stay connected to their customers as
people stayed home to slow the spread of virus. This digital
adaptation proved to be crucial to small business success.
According to a survey by the Connected Commerce Council, 72
percent of small businesses increased their use of digital
tools during the COVID-19 crisis. Unfortunately, small
businesses without reliable broadband access proved to be at a
significant disadvantage when it came to this digital
transition.
As a Representative of one of most rural districts in the
country, I heard firsthand from many entrepreneurs about the
struggles, the lack of access to high-speed broadband created
during the pandemic. Although I would also note that that was a
conversation that I had often with small business owners and
many others around the district even prior to the pandemic.
In my home State, roughly half of all road miles are
considered unserved or underserved by broadband infrastructure.
Statistics like these are not unique to Maine's Second
Congressional District. Unfortunately, many communities across
the country also struggle to access broadband at benchmark
speeds. Broadband subscriptions continue to grow. However,
rural and Tribal areas lag behind urban and suburban areas in
broadband deployment. As a result, at least 25 million
Americans still lack access to high-speed internet, many of
which live in remote and rural parts of our country. This is
known as the digital divide. Factors like low population
densities, rugged terrain and fewer subscribers to spread
deployment costs among have contributed to a lack of investment
in broadband networks by private companies.
Without access to high-speed broadband, small firms in
these areas are at a significant disadvantage. From connecting
with consumers to filling orders, a broadband connection is
essential to the day-to-day operations of many Main Street
businesses. This lack of access to high-speed broadband has
proven to be an economic drain on many communities, impacting
individual success in education, wealth, and access to
opportunity.
It is vital to the economic health of communities across
the country and the Nation as a whole that we close the digital
divide. As Congress considers legislative work to revitalize
infrastructure, we have an opportunity to make the investment
in broadband access.
Meeting this opportunity will require Congress and the
administration to work closely with State and local
stakeholders and invest the resources necessary to make
universally available broadband a reality. I hope that today's
hearing marks the beginning of a good conversation between
Committee members and stakeholders dedicated to closing the
digital divide and empowering small businesses.
I will now yield to the Ranking Member, Mr. Hagedorn, for
his opening statement.
Mr. HAGEDORN. Mr. Chairman, thank you for that.
And it has been a few weeks, we have been on break. And on
behalf of our members, we would just like to congratulate you
and your wife on the birth of your new daughter and glad to
hear everybody is healthy and doing well.
Chairman GOLDEN. Thank you very much. I appreciate it.
Mr. HAGEDORN. Thank you again, Mr. Chairman, for holding
this hearing. It is very important. I am excited to hear from
the witnesses, particularly Tim Waibel, who resident of
southern Minnesota. And it is going to be a great hearing on an
important issue.
As a member of both the House Small Business Committee and
Agriculture Committee, broadband infrastructure has been a top
priority since being elected to Congress. According to USDA's
Census of Agriculture, nearly 20 percent of the constituents in
my congressional district lack reliable internet service.
Unfortunately, without reliable high-speed internet, many
constituents and businesses are at a disadvantage. Under the
previous administration, significant investments were made,
such as the American Broadband Initiative, which stimulated
increased private sector involvement in broadband
infrastructure, and it was a bridge to the gap in rural
America. However, despite significant advances, many rural and
Tribal areas still have limited or no access to broadband
capabilities.
The digital divide has only grown wider as broadband
deployment in urban areas continues to outpace deployment in
rural areas. Congress must work to find solutions to address
this digital divide.
While we can all agree that providing small businesses with
the tools and resources necessary to thrive, examining policies
to help businesses get back on their feet is a priority. One
way that we can ensure that we meet this goal is to have better
broadband connectivity, which has been found it be a key aspect
in increased economic growth for rural businesses. In fact,
according to a study by the Congressional Research Service,
broadband access in adoption in rural areas is linked to
increased job and population growth, higher rates of new
business formation, increased home values, and lower
unemployment rates. Industries, such as agriculture and
healthcare, which are vital to rural America, have increasingly
relied upon broadband connectivity as technology capabilities
have developed. Telemedicine has provided many benefits to
rural communities during the pandemic and also has become a
reliable way to ensure rural areas receive timely quality
healthcare. The continued expansion and modernization of
telemedicine capabilities will be essential to ensuring rural
communities that they have the equal access to high quality
care.
Additionally, many small businesses, farmers and ranchers
in southern Minnesota are increasingly relying upon technology
as they seek to strategically decrease input, such as
fertilizer and fuel, while simultaneously increasing yields.
Without the availability of high-speed internet, they would
not be able to keep pace with modern technology. Programs such
as the ReConnect Pilot Program, which was authorized in the
2018 farm bill, have helped build out broadband infrastructure
in rural areas that lack broadband access. This has helped make
significant advancements in broadband infrastructure in my
district and many others across the Nation. I was proud to
support additional legislative efforts in the CARES Act and
Consolidated Appropriations Act of 2021, which appropriated
more dollars like ReConnect, and it helped to make progress.
I am going to submit the rest of my statement for the
record. I want to keep us on time. Thank you for holding the
hearing. I look forward to hearing from the witnesses.
Chairman GOLDEN. Thank you, Mr. Hagedorn.
Just a quick moment to explain how the hearing will
proceed. Each witness has 5 minutes to provide a statement, and
each Committee member will have 5 minutes for questions. Please
ensure that your microphone is on when you begin speaking and
that you return to mute when finished.
Now we will introduce our witnesses. Our first witness is
Ms. Peggy Schaffer, executive director of the Connect Maine
Authority, located in Augusta, Maine. She previously served as
the small business advocate for the Secretary of State's Office
and served as the Co-Chair of the Maine Broadband Coalition, a
statewide group advocating for high-speed broadband.
On behalf of my district and the State of Maine, we thank
you for your dedication and welcome you to the Committee.
Our second witness is Mr. Dan Sullivan, president of the
Downeast Broadband Utility located in Calais, Maine. Mr.
Sullivan has more than 40 years of experience in information
technology, including as a small business owner and IT director
from one of the region's largest employers. Downeast Broadband
Utility, also known as DBU, is the first and only operating
municipal broadband utility in the State of Maine. The network
is owned by the city of Calais and the towns of Baileyville and
Alexander.
Welcome, Mr. Sullivan.
Our third witness is Mr. Matt Dunne, founder and executive
director of the Center on Rural Innovation located in Hartland,
Vermont. Launched in 2017, the center is a social enterprise
committed to supporting resilient economic development in rural
America. Their sister organization--I am sorry. CORI's sister
organization, Rural Innovation Strategies, provides strategic
consulting to bring prosperity and investment to rural areas in
the digital age. Mr. Dunne served in the Vermont State
legislature, AmeriCorps, and Google's Community Affairs
Division. He holds is B.A. from Brown University and is a
lifelong Vermonter who lives on a 100-acre farm where he was
raised.
Welcome, Mr. Dunne.
And the Ranking Member, Mr. Hagedorn, will introduce his
witness.
Mr. HAGEDORN. Thank you, Mr. Chairman.
Our fourth and final witness is Tim Waibel, president of
the Minnesota Corn Growers Association, one of the largest
grassroots farm organizations in the country. Mr. Waibel, who
hails from Courtland, Minnesota, in our congressional district
in southern Minnesota is also a farmer with his wife and two
sons. They grow corn, soybeans, and they raise hogs. Mr. Waibel
has been on the State board of directors for the Minnesota Corn
Growers Association for 9 years, serving in a variety of
leadership capacities, including first vice president,
treasurer, secretary, and now president. I think he has
cornered the market there on the corn growers. His lifelong
experience is not only a producer but advocate for the
agriculture industry in general. And he will be extremely
beneficial to our hearing today. And thank you, Mr. Waibel, for
testifying and sharing your experience with us.
Mr. Chairman, I yield back.
Chairman GOLDEN. Thank you very much.
We will now go to opening remarks from our witnesses.
With that, I will recognize Ms. Schaffer for 5 minutes.
STATEMENTS OF PEGGY SCHAFFER, EXECUTIVE DIRECTOR, CONNECTMAINE
AUTHORITY, AUGUSTA, ME; DAN SULLIVAN, PRESIDENT, DOWNEAST
BROADBAND UTILITY, CALAIS, ME; MATT DUNNE, FOUNDER AND
EXECUTIVE DIRECTOR, CENTER ON RURAL INNOVATION, HARTLAND, VT;
AND TIM WAIBEL, PRESIDENT, MINNESOTA CORN GROWERS ASSOCIATION,
BURNSVILLE, MN.
STATEMENT OF PEGGY SCHAFFER
Ms. SCHAFFER. Good morning. I am Peggy Schaffer, executive
director of Connect Maine Authority. And I wish to thank you
for this invitation to testify in front of the Committee House
Small Business Subcommittee on Underserved Agricultural and
Rural Development to talk about supporting small industries
through investments in broadband infrastructure.
Congressional support for bringing high-quality broadband
to everyone in this country, rural and urban, is central to
solving this problem. Connect Maine is a quasi-independent
authority charged with bringing broadband to everyone in the
State of Maine and making sure they can use it. Connect Maine
was created in 2007 with a budget of about $1.5 million. We
have two grant programs. One is for community planning, and one
is for infrastructure. Over the past 12 years, we have provided
about $12 million in infrastructure grants to ISP, attracting
about $15 million in match from companies and communities.
Last summer, Maine voters approved a $15 million
infrastructure bond, and just this past month, we awarded $8.6
million of those funds to 20 projects that will serve 8,500
households, matching $16 million in company and community
funds.
In 2016, we started our community planning process. These
are small grants that help communities plan how to expand
broadband service in their area. Over 160 communities engaged
this in process so far. In Maine and nationally, broadband
infrastructure is a road-by-road battle. Where you live really
matters. A neighbor half mile from you might have good service,
but bringing that same service to your end of the road might
cost $30,000 or more. Identifying these gaps is an essential
part of the community planning process.
Because of the well-known problems with the accuracy of the
FCC data, many States have undertaken their own efforts to get
better data. Georgia, Pennsylvania, Alabama, Washington,
Minnesota, Maine have all developed our own mapping and data
layers. These are just the few States frustrated with the
inability to understand who has service and who does not.
Broadband is a very personal service. It is how you connect
with your family, healthcare, education, grocery shopping, and
work. Maine communities, in fact communities across the
country, realize that high-quality broadband connection is
central to their future. Broadband is the lifeline for every
community in this country, large or small. Our planning grants
act like sticky tape. It gives the community something to grab
on to and helps the ISP see a viable business case to bring
broadband to that area. Once people begin talking with their
neighbors about this critical infrastructure, they realize that
everyone in their community needs to have access to the service
and they understand the importance of affordability. This deep
granular drive into what communities want drives State plans
and data. It is also why so many small ISPs have aggressively
expanded their footprint with fiber. Providers and communities
seek solutions that will outlive the costs incurred. No longer
are we investing in infrastructure that will need to be rebuilt
in 20 years. We have found several programs are ill-suited to
meet community needs or interests in Maine. Examples of this
are the USDA grants through ReConnect and the recent FCC Rural
Development Digital Opportunity Fund.
Four projects were awarded ReConnect grants in early 2020.
These are small projects that should be a 6- to 8-month build.
None of these projects have started because of the bureaucracy
one the USDA. If these projects had been funded through a
straight grant, they would have been lit and serving people
right now, not some time in 2022. Projects all across the
country are having similar unneeded delays. There is one small
community in Lincoln County that was denied a USDA grant
because their area was auctioned off in satellite service in
the FCC's RDOF auction. They are now not eligible for any other
Federal funding. The town has been working for 3 years to
develop a solution to bringing affordable service to everyone.
Federal funding should not block that effort.
If broadband infrastructure is going to achieve its
promise, we need to make sure Federal funds flow to the
solutions these communities want. That is why the community--
the Capital Projects Fund and the American Rescue Plan is so
exciting. It puts the funds closest to community efforts
through a State program. States have proven they are up to the
task of efficiently and effectively delivering the use of these
funds to build that infrastructure. Sixteen States awarded $644
million in the Coronavirus Relief Fund to build out networks
that were lit in under 6 months. The American Jobs Plan also
offers great promise to close this connectivity and
affordability gap, but it really, really matters how the funds
for infrastructure are distributed and who owns the
infrastructure. There are hundreds of successful models of
public-private partnerships to build this infrastructure. There
is no one model because there is no one solution. It requires a
flexible strategy, and flexible strategies are just not what
the Federal Government does well.
State broadband programs have proven their worth. Our
understanding of the problems, the locations, and our ability
to craft solutions that fit our communities is central to our
effectiveness. Funding for the infrastructure through the
American Jobs Plan should flow through State and State programs
to provide the greatest benefit and the fastest affordable
connectivity to Maine people.
Thank you for your time and consideration. I would be happy
to answer your questions.
Chairman GOLDEN. Thank you, Ms. Schaffer.
Mr. Sullivan, you are now recognized for 5 minutes.
STATEMENT OF DAN SULLIVAN
Mr. SULLIVAN. Good morning, Congressman Golden and Ranking
Member Hagedorn. Thank you very much for this opportunity to
discuss the DBU project.
My name is Dan Sullivan. As mentioned, I was former IT
director at the Woodland Pulp and St. Croix Tissue pulp mills
in Baileyville. I have also been in technology for 40-plus
years and now presently am the president of Downeast Broadband
Utility.
Calais and Baileyville had a problem: terrible expensive
broadband options. The towns agreed to ban together by way of
the local agreement to explore economic development ideas, and
fiber came to the forefront. We had discussions with local
leaders and our citizens, rotary clubs, chambers of commerce,
town meetings. We hung posters. We did everything we could
think of to bring people into the room to discuss what could or
could not be done.
It was the overall decision by all these groups that we
would look, search out a fiber-to-home solution for our two
towns. So the two towns agreed to fund a feasibility study to
see if this was even possible. The results came back and said,
yes, it indeed was. So the towns again funded the cost to build
the construction to see how much it would cost to do it. We had
unanimous support from both the towns.
The network is paid for by subscribers to the network, not
taxes raised. That is the beauty of this financial model. The
need in these towns is so great and people want it so bad that
our subscriber rate is going through the roof. So this will be
paid for by the people who buy the service, not by the citizens
of these towns. But, uniquely, the citizens of these towns will
actually own the infrastructure.
We began construction in 2018 and completed in 2020. Then
the town of Alexander--which is next to Alexander, asked to
join us. We approved them. They are now being constructed. They
will probably be completed the end of December. Just last week,
I met with Indian Township, our local Indian reservation. They
have too voted to join DBU and are now proceeding with that.
Construction will begin shortly.
On top of that, 2 days ago, Princeton contacted me. I had a
meeting with them. They too have voted unanimously to try to
join DBU, and the town of Cooper will be doing the same thing
in July. So you can obviously see there is an awful lot of
demand out.
So why did we do this? We did it because our existing ISP
options were insufficient, unreliable, expensive, and in many
cases not even available. We approached the existing ISPs and
offered to help them fund a buildout to bring fiber to our
towns, businesses, and homes. They refused. They weren't
interested. So local businesses and residents universally
complained about how slow and expensive broadband was.
And Washington County's largest employer, St. Croix Tissue
and Woodland Pulp, where I worked for many years, was very
interested in this solution. And I would like to read a brief
statement by the mill's manager. He said, quote: Affordable
access to symmetrical broadband via fiber is a game changer for
our area. It has increased property values, facilitated remote
work and learning, while attracting new residents to our
communities. From my perspective as an executive at Washington
County's largest employer, fiber-based broadband has proven to
be a valuable recruiting tool to attract technical talent to
our area and business. In addition, it has helped our employees
to effectively work remotely through this pandemic. Prior to
the founding of the Downeast Broadband Utility, our area's
access to this vital service was completely insufficient,
unquote.
We knew from our research that a fully fiber network was
what we needed to do here to build a future-proof solution for
our area. And Maine's home rule provision in Maine's
Constitution allowed us to proceed with that. So we tapped into
our Yankee spirit, and DBU was born.
What did we build? This is a mouthful, but we built an open
access, dark fiber, home-run network. Each subscriber receives
a single dedicated fiber to their home or business. This
ensures had a 100-plus year future-proof solution. Science has
not yet reached fiber's capacity limits. They don't know how
fast they can make it work. And once the fiber is installed on
these poles when technology changes, and the technology
improves, only the laser equipment in our communication
cabinets have to be upgraded. The existing fiber cable will be
viable for those 100-plus years.
As a contrast, cell towers need to be climbed and
satellites relaunched to keep up with changes in technology.
These technologies do not provide a future-proof model, are
impractical, expensive, contribute to mountains of space junk.
And all these costs are passed down to the consumer.
Now our network is open to all ISPs, even the ones that
turned us down. We basically turned their argument of low-
density population not being an affordable way to do this
upside down because we paid for the construction, the
maintenance, and the operating costs. We have taken three legs
off their stool to provide this service, and they are welcome
to join us, and I hope they do.
DBU is a utility much like roads, water, sewer. And it is
owned by citizens of these towns. We determined about a 30
percent tick rate from Calais and Baileyville will make the
plan viable. We are presently at 23 percent in the midst of the
pandemic and soon expect to pass 30 percent and beyond. We
estimate Alexander and Indian Township to a 80 to 90 percent
tick rate as their broadband situation is more dire. And here
is the real caveat to all of this, the caveat to the ability of
benefits, the base fiber internet package for the by 100/100
megabit connection is $59.95 with no set up fees, no router
fees, no contract fees. And no data caps. In the poorest county
in the State of Maine, we have the fastest internet in the
world at the most reliable cost.
So, in conclusion, I would like to say, Maine and our
Nation have paid for inadequate solutions to our country's
dismal broadband for decades, only to be still treading water
and, in some instances, drowning. An undeniable fact is that
fiber is the most future-proof, cost-effective way to build
ubiquitous broadband for our Nation for the next 100-plus
years. Municipalities owning that physical network not only
ensures competition but lowers cost, provides faster, more
reliable speeds, and it solves the problem. The backbone of the
internet is fiber. The middle mile is fiber. It has only been
this last mile to the business and consumer that has been
relegated to copper or, even worse, wireless, and only because
it is more profitable for cable and phone companies to keep
using their 19th century technologies rather than investing
completing this fiber network. These companies are private and
deserve to invest their dollars as they see fit.
Chairman GOLDEN. Mr. Sullivan.
Mr. SULLIVAN. We have no argument with that. It is our
position that taxpayer funds need to be--I am almost done--need
to be 100 percent directed towards finishing the home solution.
We really appreciate your Subcommittee's work on this. We hope
that we can contribute with you to help solve this problem for
Maine and the Nation.
I will take any questions that may be out there. Thank you.
Chairman GOLDEN. Perfect. Thank you.
Next we will recognize Mr. Dunne.
Mr. Dunne, you are muted still.
STATEMENT OF MATT DUNNE
Mr. DUNNE. Apologies.
Chairman Golden, Ranking Member Hagedorn, and members of
the subcommittee, thank you for this opportunity. My name is
Matt Dunne, and I am the founder and executive director of
Center on Rural Innovation, known as CORI, a nonprofit action
tank started in 2017 to close the rural opportunity gap. Today,
we are working with a network of small towns across the country
to help them become successful in economic development and
entrepreneurship in the 21st century. This ranges from helping
communities build world-class broadband, facilitating
technology training, supporting accelerator programs, and
investing in scalable small businesses.
The rural urban divide that has emerged since the Great
Recession was driven by automation, globalization, and a
decline in rural entrepreneurship. By January of 2020, before
the pandemic, less than half of all rural counties had returned
to their pre-recession employment levels as rural businesses,
large and small, struggled to regain solid footing. The COVID-
19 shutdown only exacerbated the problem for many rural small
businesses, particularly those dependent on tourism.
Driving this divide was the fact that high-paying,
resilient digital economy jobs like computer programmers,
cybersecurity analysts, IT specialists, and others are not
distributed equally across the country. Rural America
represents 15 percent of our nation's workforce but only 5
percent of the digital economy jobs. It doesn't have to be this
way. In the age of the internet, there should be no limit to
where digital economy jobs and startups can take place.
The pandemic has only reinforced what we in rural America
already knew: Broadband is critical infrastructure. It is as
vital to equity and prosperity as electricity and
transportation. For businesses, it was nothing short of a
lifeline as Main Street companies tried to quickly shift to
online ordering and delivery. While some businesses and workers
could pivot to e-commerce or transition to remote work, unequal
broadband access left the rest, so many of them in underserved
rural areas, struggling to get by. But our awareness of the
issue has created a moment in time that resembles one our
nation faced nearly a century ago, when leaders realized that
unequal access to electricity prevented regions of the country
from being able to thrive.
The good news is that like the rural electrification
effort, there are models for bringing world-class broadband to
rural places like the one that Mr. Sullivan has been so deeply
involved with. In fact, at least 10 million rural Americans
already live in Census tracts with gigabit-speed broadband.
These communities built networks well beyond the FCC minimum
standards for broadband because they understood that level of
service is already on its way to becoming obsolete. As a
result, they are ready to participate in the digital economy of
today and meet the demands of the future. They invested in the
infrastructure that can do both.
The question before us now is, are we going to go do what
is necessary to generate broadband that supports the businesses
of today and tomorrow? Without it, millions of underserved
rural Americans and small businesses can't engage with
streaming content, cloud-based services, and video conferencing
applications that have become part of everyday life. That is
why it is critical that future funding should prioritize
delivering a minimum of 100 megabits per second upload and
download speeds and building networks capable of scaling to a
gigabit or more. To do otherwise is only setting ourselves up
for a rural-urban divide that reemerges 5 years from now
despite a massive infrastructure investment.
COVID has opened people's eyes to the possibility of
working where they want to live rather than living where they
need to work, including an incredible return to small-town
America. But this is only possible if rural areas can achieve
the same internet speeds as their urban counterparts. Doing so
would enable entrepreneurs and small businesses in rural places
to access markets anywhere in the world and be resilient to
events like the pandemic that forced so much activity online.
We at CORI know plenty of small towns that are proving this
is possible, places that invested in gigabit-speed internet
broadband or are leveraging their current broadband to make
successful businesses emerge. In Taos, New Mexico, a program to
help local businesses build e-commerce websites during the
pandemic helped some see revenue increases by 10 percent. In
Wilson, North Carolina, a former auto repair specialist
developed a software platform called Shyft Auto to solve the
inefficiencies he knows plague the service shops everywhere.
They are receiving investment and are growing. In Red Wing,
Minnesota, the robotics company Poultry Patrol was able to test
its prototype in the field thanks to the upload and, download
speeds possible with the region's high-speed broadband network.
This is a moment unlike any we have seen before in the
internet age. The funding currently being considered to boost
broadband deployment expansion is vital to ensure every
innovator and small business person can take part in the
digital revolution and reach their full potential wherever they
live.
Thank you for your time and consideration of this important
issue. And I am happy to take any questions you may have.
Chairman GOLDEN. Thank you.
And, finally, Mr. Waibel, you are recognized for 5 minutes.
STATEMENT OF TIM WAIBEL
Mr. WAIBEL. Thank you, Chairman Golden, Ranking Member
Hagedorn, and the members of this subcommittee. Thank you for
holding this hearing and letting me testify.
My name is Tim Waibel. I am a farmer from Courtland,
Minnesota. It is a town of 611 in Representative Hagedorn's
district. My wife and I have raised five children. We have six
grandchildren and are looking forward to three more coming in
2021. My wife and I both feel blessed that we have been raised
in rural America, and we want them same blessings for future
generation. I know that many of you share this feeling.
The pandemic has taught us a lot of lessons. One is that
people living in the cities grew to appreciate the advantages
of living in rural America, and many picked up stakes and moved
here. Over the years, I have been saddened to see our
communities raise wonderful kids only to see them go off to
college and never return to raise their families here, instead
moving to the cities and suburbs. A town like Courtland has
suffered due this and not just economically; we have lost a lot
of talent. And I think that those of us who have lost--excuse
me. I think that those who have lost to the cities we have also
been deprived of some life-enriching experiences that only a
small town can provide. So the thought that at least some
silver lining might come with this tragedy of the pandemic may
be a rebirth of towns like Courtland, which brings me to my
second lesson.
We have all heard stories remote learning. While there is
more of it, I am speaking here on the issue on the heart of
availability of broadband. Kids growing up in rural areas who
do not have access to decent internet service are at a
disadvantage. Senator Klobuchar mentioned that one student went
to a local liquor store parking lot because that was the only
place that they could get internet service. This is not an
isolated problem. It is a problem for anyone who lives and
works in rural American communities because it impacts
education, business, healthcare, and even farming. Lack of
high-speed internet access is a serious obstacle to the rebirth
of rural America I am hoping for. I am gratified at this time
when there is so much partisanship, that there is a bipartisan
consensus on the need to look into significant new investment
in broadband.
But as you know, throwing money at a problem doesn't always
fix it. Billions of dollars have been spent on expanding
broadband internet, but efforts have still come up short. So I
hope that you will take into account a few points from my
perspective as a lifelong rural resident. First, it matters who
is providing the broadband to our rural communities? Do they
have a real stake in rural America? Do they have a proven track
record in serving rural America? And do think have boots on the
ground to get the job done?
From my vantage point, the Department of Agriculture and
rural electric cooperatives and similar entities with a long
history of working with the USDA check these boxes. But that is
not where the lion's share of the Federal dollars have gone.
Billions have gone to other Federal agencies to stand up
programs using other broadband providers that are often
protected from competition, even if they provide substandard
service. My understanding is that there is an interest by some
in standing up another Federal program, but I do not believe we
are going to get any different results than we have had going
down the same path.
There is fierce competition amongst various agencies and
providers in regard to who gets to carry the important mission.
But addressing the needs of rural America, including broadband,
is a mission of the USDA, rural electrics, and the like. And,
yet, the dollars that we have spent have paled in comparison to
the dollars under other programs where the providers do not
check all the boxes that I mentioned earlier. Had FDR taken
this approach for rural electrification, God knows how long it
would have taken to get power to our farms.
I would like to recognize Representative G.T. Thompson, who
has brought a very thoughtful bipartisan broadband bill that is
worth your consideration because it recognizes the points that
I am making here today. The second point is there are gaping
holes on the map in terms of people with zero service. But
there are also even more holes in the map where people have
terrible broadband service and pay an arm and a leg. I feel I
fit in that category. Both problems need to be addressed.
Setting high goals for service in this process will be
important. And if the providers are not meeting the goal, they
ought to open it up for competition.
And, finally, in my perspective as a farmer, remember that
it is not just about location served, but it is areas served.
Why is that important? Because my farm not only needs the kind
of internet that a business needs in town, we also have mobile
offices. My tractor, combines, and so on and so forth talk back
and forth where I need to be able to upload data as I work the
fields. This is a vital efficiency in providing food, fuel, and
fiber, but is also critical in caring for the natural resources
promoting soil health, clean air, water, and the reduction of
CO2. Agriculture amounts for a very small percentage of CO2
emissions and is already sequestering carbon, but we are glad
to help sequester carbon using tools voluntary incentive-based
tools. One such tool is high-speed internet.
So, as you carry out the important work in this issue, I
hope my perspectives are helpful. Thank you for letting me
testify. If you have any questions, I can try and answer.
Chairman GOLDEN. Thank you, sir.
And I appreciate each of you for being here today to talk
about connecting rural America.
We will now move to 5-minute questions. And I will begin by
recognizing myself.
Mr. Waibel, I would just point out, I think you probably
have a lot in common with Mr. Sullivan, who also talked about
the high cost of some of these programs that have not been
nearly as effective as they should be in delivering good
access, the kind of access that you have spoken about and that
Mr. Sullivan has also talked about.
I had to note too, sitting here, Pete, thinking last
Congress, we held a field hearing--you held in Minnesota, and
Jim joined us. I forget the town. What town were we in?
Voice. [Inaudible.]
Chairman GOLDEN. Stauber. That is hilarious.
The economic case for doing something here speaks for
itself. I will just say we were at a machine precision--
precision machining shop there where they were talking about
how they couldn't really expand the business and in fact might
have to move it into a more suburban or rural area if they
didn't have access to broadband. So it is about protecting jobs
and creating the opportunity to expand.
And then Congressman Stauber came up to Maine. And we had
very similar conversations about how important this is in rural
Maine. So a lot of similarities between the two.
Mr. Sullivan, I thought I would just start with you. Maybe
you could take a little time and get more indepth about what
are the issues that we came across in your community in looking
at some of the Federal programs that are out there, Federal
dollars, grants, and other things that just weren't workable in
Calais and Baileyville, and as a result, why did you end up
going with this very local solution?
Mr. SULLIVAN. I think it was alluded to by some of the
other speakers. Some of the Federal programs are quite onerous
and time-consuming in order to be able to make something
happen. And there is a lot of abilities to trip along the way.
And the need was so dire in our area that we decided to--we had
such unanimous support from the citizens to be able to go and
finance this operation; we decided to proceed ahead with it,
rather than wait out the infrastructure rules. To Peggy's
point, there is a lot of roadblocks in the way there that kind
of slow these projects down.
And also I will say that the Federal description of
broadband, for years, they have been at this 25/3 number, which
is completely inaccurate. That is not broadband by any stretch
of the imagination. So we decided to try to step over those
hurdles, if possible, and we were able to do it.
Chairman GOLDEN. Thank you. I appreciate that.
I don't know if was you, Ms. Schaffer, who had in your
written testimony or maybe it was someone else, the example of
Cranberry Isles, where there is such a--first, a Federal agency
comes and announces that there is going to be broadband brought
to the community through a grant, and then, years later, it is
not there. I think Senator Collins from Maine has been working
on finally getting a solution. But in the interim, they took it
upon themselves to fix it, I am sure working with the State.
But could you talk a little bit about that but also just think
about what Dan said? What other examples do you have out there
of inefficiencies or just bureaucracy of those programs being
unworkable, and how have you helped?
Ms. SCHAFFER. Well, I think one--the place you went to
visit when you did your field visit was Roque Bluffs, and they
got a USDA grant in I think it was December of 2019, official
announcement in early 2020. They still have not built a thing.
It is not that big a town. I think the bill was under a million
dollars. They have been hit by roadblock by roadblock. And it
is just when you look at--if you compare that, for instance, to
Cranberry Isles, who really started out on their own, and then
USDA came in late with the funding. Cranberry is built. It was
built before the USDA funding came through. And now there is
this discussion about who pays for what. But the process of the
USDA does not really work for small towns. It really doesn't
work for municipal networks. It doesn't work. And part of that
is it is a one-size-fits-all solution. So, whether you are
building a $20 million grant network or whether you are
building a million-dollar network, they don't downsize it in a
way that makes it or right size it in a way that makes it work
for small towns. And so that for us has been a major barrier.
The other barrier for the USDA funds is they have been--you
have to have a service of under 10/1 to be qualified. And one
of the things I frequently say is you have to go through the
willies to get to the wags (ph). So sometimes you have to serve
people who have some level of service before you get to people
who have gotten little service. And the USDA's standard of 10/
1, which is lower even than the FCC, which is just
unacceptable, it doesn't recognize that. And it also sentences
people who have--who are just a little better than 10/1 to
nothing, to no support and no help. And that kind of structure
doesn't work when you are trying to bring service to rural
America.
Chairman GOLDEN. Thank you. So we will dig in a little
further on some of these things, but it sounds like you are
calling for greater flexibility in these programs at the very
least.
With that, I will turn it over for 5 minutes to Mr.
Hagedorn.
Mr. HAGEDORN. Thank you, Mr. Chairman. I agree with you.
And this is just basic infrastructure issue. It is quality of
life for the folks in rural areas. We need to make sure all
Americans have the same access and opportunities.
And my friend Mr. Waibel from southern Minnesota makes a
good point. I mean, if we don't have these types of services,
it is going to be hard to retain the folks in our rural
communities and certainly to attract them in, even if we have
great jobs and that type of thing.
Mr. Waibel, really quickly if you could help some of the
folks understand exactly what the farmers go through and their
needs are in the digital age. I know for instance, hog
operators might have an automated system to feed their hogs
which would obviously require a lot of work on the internet.
But when you do your duties, your planning and things like
that, can you kind of fill us in about what is going on out
there and why you need a good broadband connection?
Mr. WAIBEL. Certainly. Thank you will for the question. So,
in the fall, when we harvest, we work with certain vendors,
fertilizer people, so on and so forth, that they can follow us
in the field, and they know exactly when we are done harvesting
a field so they can come and spread fertilizer and so on and so
forth. There is no phone calls. They know exactly what needs to
be spread because of prior meetings and so on and so forth. So
it just saves a lot of time in that aspect. And the same way
with information shared by our harvesting machines, it goes
directly to people that we work with. They know exactly what we
have seen and they can dig deeper into it. So certainly if we
need to change something for the coming year on an application
we can do so real quick and a lot of things. Everything is
connected now on the farms. It is amazing. I never thought I
would witness something like that in my lifetime.
Mr. HAGEDORN. I agree with you. When you talk about,
especially in rural communities, you trust the USDA, you trust
the local companies, the REAs and others to deliver the
services that has been your experience. Do you want to go
further on that, or has enough been said?
Mr. WAIBEL. I do believe the reason why I am a big fan of
the REAs is because of the fact we have local boards, local
people that we know that serve on these boards. And they are
going to look out for, number one, the most cost-effective ways
to deliver that service and, number two, what is good for the
community.
Mr. HAGEDORN. Ms. Schaffer, if I understand you, you are
criticizing USDA and others because they are trying to focus
most of their attention on making sure everybody is at a basic
level so they have some level of service. I think if you take
the moneys and start spreading them around in order that
everybody has 100/100 or whatever before people can get to some
decent level of line speeds, that wouldn't seem fair to me.
What do you say to that?
Ms. SCHAFFER. You know, there is--so you can figure this
out through scoring on a grant process. So, instead of defining
in the application of who is eligible and who is not, you can
give extra points to a project that starts at essentially
nothing and brings them up to something. And that kind of
process allows for you to actually build out to more of the
communities and make sure that all the communities are on an
equal footing.
And so I think when you define it in your eligibility
standards, you limit who is eligible. But if you can do it
through a scoring process of giving more points in an
application for people who are serving people who have worse
service than others, then you can accomplish the same thing,
but you also get to serve more of that community. So, instead
of bringing a tiny little piece of that community to the modern
world, you can bring the entire community up. And I think to
me, that is the important piece thinking about, not just in the
eligibility but really looking at how you score these projects.
And that gets rid of some of this concern about what is
traditionally called overbuilding.
I will say, in this country, we have much more interested
policywise in preventing people from getting two kinds of
service than making sure everybody has a service. So that is
what when you limit it to 25/3 or 10/1, that is what you end up
doing.
Mr. HAGEDORN. It just seems to me that people who have no
service--I mean, this is why the government is involved in
this. This is why we are all together in a bipartisan fashion,
we want to make sure people have some level of basic service.
And I think that is where we should focus our attention. If we
can get people to higher speeds down the road, that is all well
and good. And maybe a private sector and others will help us
out a little bit more, but I think what Mr. Waibel and others
have been saying, and I agree with, that we should focus on
those who have no connectivity or have speed so slow, that they
really aren't able to compete and participate like the vast
majority of the people across the country.
So, with that, I yield back. Thanks, sir.
Chairman GOLDEN. Thank you.
Next, we will recognize Representative Roger Williams, Vice
Ranking Member of the Committee.
Mr. WILLIAMS. Thank you, Mr. Chair.
Throughout my district in Texas, I constantly hear from
constituents about unreliable or complete lack of internet, and
that is in Texas. Unfortunately, many of the Federal broadband
dollars are invested in the areas with the lowest cost of
deployment, rather than the areas most in need. This has led to
many rural areas of the country continually being left behind
in the digital economy as we have heard this hearing. That is
why I have introduced the bipartisan Eliminate the Digital
Divide Act, that would give money directly to the States to
decide where the greatest need is for their constituents.
So, Mr. Waibel, thank you for being here. I too, I don't
have an operation as large of yours, but we have calf, cow in
Texas and a few pigs so I appreciate what you are doing. In
your testimony, you discussed the disparities between urban and
rural areas relating to access to high-speed internet. Can you
discuss the challenges your community--and you have done that a
little bit today--your community faces due to the lack of
connectivity and how it puts them as an economic disadvantage
compared to your urban counterparts?
Mr. WAIBEL. Certainly. So, if I would go 30 miles to the
east of here, we have a community of about 60,000 people. And
certainly the businesses, when I go down there for whether it
be parts or questions at my local FSA office, their internet
service is just boom. And it is there whereas when I am at home
here with my service, it--a lot of folks know that that there
are times it will take me an hour to get an email into my
computer at home here. And that is extremely frustrating. And I
think, when we look at rural America, we need to be on a level
playing field. This to me is the most important thing for the
future of my boys farming with us or all my kids and my
grandchildren to stay up to speed with whether it be a town of
60,000 people or whether it be a town of 611 people, we need to
be on the same playing field. This is going to set the future
growth for our areas and the businesses that will hopefully
establish and stay here in these small communities.
Mr. WILLIAMS. Thank you. I agree with that.
When we hear about small businesses adjusting to the
digital economy, many of us think about brick-and-mortar retail
stores creating an Online presence. However, one of the
greatest beneficiaries of connected technology has been the
agricultural industry. We have seen new innovations that have
the potential to increase harvest yields, make watering
schedules more efficient, and can update machinery
automatically. All these advancements can help us better secure
our food supply chain and properly feed our Nation.
Unfortunately, if we continue to leave the rural parts of our
country behind as we have heard, our farmers will not be table
to experience the benefits of these new technologies.
So, Mr. Waibel, again how does access to broadband improve
your day-to-day business as a farmer? And what concerns do you
have in the future of farming, if the divide is not closed? You
touched on that a little bit, but I think that is important.
Mr. WAIBEL. Yes, correct. You know, so, when I look at the
whole operation, we are moving, we are in this digital age, and
I think we are probably more--even though it seems like we are
into it a long ways, I think the future is only going to demand
more of it. And we use it just for everything. And it is only
going to get more and more.
For those of you that aren't that familiar with farming,
when we go into the field, we push a button, our boundaries are
in the field, and the tractor takes over and does what it needs
to do. You are just in there for the ride basically and so on
and so forth. So these types of situations, the more advanced
our implements get and the more advanced our suppliers are, the
more we are going to need to continue to have these high-speed
updates that it doesn't take us an hour to get something; it
takes us a minute, a second to get it. And that is where I
think we really lack in rural America is the fact that we
really need to get this sped up.
Mr. WILLIAMS. Thank you.
Real quick, access to broadband is no longer a luxury but a
necessity. Big corporate providers have shown that the
economics of connecting some of the most rural communities
simply do not work. If we want to provide internet to these
communities, we need to look for ways the Federal Government
can better utilize the public-private partnerships. By
leveraging public funding through private execution, we can
tackle rural broadband infrastructure and close the digital
divide.
So, Mr. Sullivan, real quick, what barriers typically keep
private citizens from entering into these partnerships? And how
can we incentivize them to participate in Federal grants such
as the USDA ReConnect Program to build out broadband
infrastructure in rural communities?
Ms. SCHAFFER. What has basically been happening is it is
very difficult with some providers to work with them. In that
type of arrangement, which is basically what has been happening
in Maine and across the Nation now for quite some time is a lot
of the existing providers have been receiving Federal and State
subsidies to improve broadband. But they are not improving it
to the level that it will in my 5 minute speech here about
trying to make it future proof so that when we do these
investments once, we don't do them multiple times because that
is what has been happening. The existing ISPs are only going to
put as much of their money in as they can keep their costs as
low as possible to keep their stockholders happy. We understand
that. That is how America works. But by investing public
dollars with these partnerships without having minimums. They
ought to have some standards that say we aren't going to give
money unless you can provide a 100/100 fiber connection because
we know that connection can be upgraded, as others have said,
to a gig, to 10 gig, to 100 gig. I mean, that piece of
investment will always be there. So it is important that when
these ISPs are brought into a room, that they understand that.
This is how we need to focus the dollars that are coming from
the public because it should be there to serve the public.
Mr. WILLIAMS. All right.
Thank you very much, Mr. Chairman. My time is up. I turn to
you.
Chairman GOLDEN. Thank you, sir.
We will next recognize Representative Troy Carter from
Louisiana too.
Mr. CARTER. All right. Thank you, Mr. Chairman. Thanks for
the opportunity. And either of you can take a stab at the
question. I hail there Louisiana where we have a fairly
substantial amount of our rural areas that are in fact
challenged as relates to broadband. And we know that, under the
current guise of COVID, COVID taught us that we will be relying
much more on distant learning in classrooms, technology for
businesses. And that necessity brings the real attention to the
fact that many parts of our State and our country, but
particularly the Second Congressional District, we have issues
with access to broadband from a basic standpoint, but then when
we juxtapose that with the reality of poor people throughout
our State, throughout our country that will in fact--and I have
heard the word several times ``left behind'' mentioned by some
of my colleagues. What are the plans for obviously making sure
that we have access to broadband in those areas where there is
no infrastructure? But, additionally, your thoughts on how we
level the playing field for our impoverished areas as well. I
am going to pick somebody, if somebody doesn't jump in.
Ms. SCHAFFER. I think the piece we that do around on
community planning is a central element of this because it
allows the community to understand the importance of
affordability. I think broadband has four pieces to it: the
wire run by your house; can you afford to connect to that wire;
do you have a device; and do you know how to use it? And when
you began those community conversations, those last three
pieces come in as a critical element of it. And then you can
design a network and pick a provider and pick a partner that
can give you that kind of connectivity. I think Danny talked
about how Downeast they have, they are providing a high-quality
service for about $60 per month. That is still unaffordable to
some families, but it begins to address sort of that issue. And
I think that that, to me, the critical piece about the
community understanding and working with the provider and
helping to underwrite some of the infrastructure costs helps
some of those equations. But affordability is a key issue in
this puzzle.
Mr. CARTER. And what would you determine or think would be
the greatest barrier, from an educational standpoint, of
informing the public of their duty or their participation?
Ms. SCHAFFER. So do you mean participation in a planning
process or participation in getting internet?
Mr. WILLIAMS. Well, you mentioned that a part of it was
them understanding and participating. So what is the greatest
barrier to that?
Ms. SCHAFFER. Some of that is really--and I think COVID has
resolved a little of this, is understanding what the internet
can bring to you. I mean, Tim has talked about farming. The
USDA estimates that the farms with high-quality internet have
about an 18 percent increase in capacity. So they are able to
produce a lot more. And that kind of activity can happen, as
Matt talked about, on just about every business level for
tourism, businesses in those. And so part of these
conversations in the community is understanding the needs of
all of those businesses and making sure that the business and
people can engage in this understanding of what this service
can bring to your area.
Mr. WILLIAMS. And I will tell you from Louisiana's
standpoint, and I don't think it is any different from many
other places, but certainly Louisiana we know now that
broadband is a way of life. It is not a luxury. It is not
something you have as a one off. It is essential. Yet we know
that large swaths of our country, large swaths of Louisiana do
not have access to broadband, not just for education but also
for daily use. We know that broadband in many ways fuels our
whole economy. It connects our world.
So, as we go on through this discussion, Mr. Chairman, I
would Love to have further discussions on how we can advance
those discussions, particularly around areas in those rural
areas that have really suffered. And COVID has taught us
significantly what that means to our economy and what it means
it our world. So I thank you all for your testimony and look
forward to further discussion.
I yield back.
Mr. SULLIVAN. I would like to weigh in on that for a
second, if possible.
Chairman GOLDEN. Who was that?
Mr. SULLIVAN. I would like to weigh in on that point for
just a moment.
Chairman GOLDEN. He is out of time, but we will find a way
to work it in, Mr. Sullivan. The second round of questions, I
will just make a note.
Next, we will recognize Representative Pete Stauber from
Minnesota, Eighth District.
Mr. STAUBER. I thank you, Chair, and thank you, Ranking
Member Hagedorn, for holding this hearing. And, to all the
witnesses who gave us their testimony, it is very, very
valuable.
I just have to reiterate what Mr. Waibel said a couple
minutes ago. He said, ``Rural America must be placed on a level
playing field.''
Rural Representatives on both sides of the aisle have had
it right up to here with the lip service we have been given on
expanding broadband to rural communities. It is the time to do
it right now. We have the opportunity for investment, and rural
America especially, as Congressman Carter just stated, has been
extremely devastated because of the lack of connectivity.
Our hospitals need to be connected--our schools, our small
businesses, and so many others in our rural communities--to get
us on that level and fair playing field so we can be connected,
so we can bring businesses to rural America.
Mr. Waibel, in your testimony, you highlighted something
that is critical for people to understand. Our small towns and
communities in rural America have sat at a stark disadvantage
for way too long. It has left our kids at a disadvantage, and
the studies--our seniors at a disadvantage in their healthcare
when we talk about telehealth and telemedicine. And, for
certain, our farmers are at a disadvantage for optimizing their
yield.
You also mentioned that not only do rural Americans lack
access to broadband; where some are lucky enough to have
service, it is inconsistent and expensive, and lack of
competition means there is nowhere else to turn.
When we here in Congress are considering broadband
investments and deployment options, we must be effective.
Unfortunately, in President Biden's proposal, he prioritizes
municipal broadband networks or government-owned networks.
In my home State of Minnesota, however, we have
restrictions against municipal broadband networks. In fact, 18
States total have restrictions against such networks. I guess
my constituents in Minnesota's Eighth Congressional District
and Mr. Hagedorn's constituents, like Mr. Waibel in Minnesota's
First Congressional District in Minnesota, and many other rural
Americans take a back seat under this piece of legislation. We
count, and rural America matters.
So what is the good news? In the CARES Act and the
consolidated appropriations signed into law by President Trump,
we were able to get a lot of money out the door to help bridge
the gap in rural America. The money was unfettered by
burdensome regulation and helped stimulate private investment.
This was a step in the right direction.
In these packages, a lot of different Federal agencies had
been tasked with the broadband deployment mission. This can be
tricky for some small businesses to navigate as we all know.
That is why I will soon be introducing the Small Business
Broadband and Emerging Information Technology Enhancement Act.
This legislation will direct the Small Business
Administration to create a broadband coordinator position that
will serve as the primary liaison to other Federal agencies
involved in broadband deployment and would identify and catalog
tools, training, and best practices for small businesses as it
relates to broadband implementation and usage.
It is my hope that legislation like mine and others will
help bring broadband investment to our rural communities, to
that last mile for economic development. The CARES Act gave us
a great start, and I think we need to take advantage of it.
I know that Chair Golden and Ranking Member Hagedorn
understand that. They both represent rural districts. And,
Chair Golden, as you alluded to, we did hear that we had a
field hearing on broadband development and deployment a year
and a half ago. In northern Minnesota and in upstate Maine, it
was the same concerns by our small businesses, our families,
our family farmers, and we have the opportunity right now to do
it right.
And, Mr. Waibel, I want to repeat what you said earlier.
Rural America must be put on a level and fair playing field
now, and we have the opportunity. And I know we have bipartisan
support in the Congress to do that, and I am looking forward to
that.
Mr. Chair, I yield back.
Chairman GOLDEN. Thank you.
Next, we are going to recognize Representative Antonio
Delgado from New York 19. I see him on the screen. I am not
sure if he has questions. We will give him 2 or 3 seconds here.
All right. We will come back to him.
Why don't we move to another part of New York, Rep. Claudia
Tenney.
Ms. TENNEY. Thank you so much, Chairman Golden and Ranking
Member Hagedorn, for holding this important meeting today, and
thank you to the witnesses for your time and your insight.
As we have we have heard today, the internet connection can
determine your destiny, and nothing shapes our ability to
access education, healthcare, and employment opportunities like
access to rural broadband. The COVID-19 pandemic has only
driven home this point.
Americans have never relied more heavily on reliable,
accessible, and affordable internet than they do today.
Throughout New York's 22nd Congressional District, there are
far too many communities who do not have access to reliable
broadband.
The digital divide is even more great when you consider our
children have less access to education, our seniors have less
connectivity with their doctors, and our business meetings are
few and far between because we are always spooling on our lack
of access to the internet.
And, to make matters worse--this, I think, is a critical
issue--upstate New York is subject to a broadband monopoly in
New York. New York State, under Governor Andrew Cuomo and the
State legislature, agreed to a cable consolidation plan under
an agreement with Spectrum, which they claimed that expanded
improved service. However, the State and New York State's
Public Service Commission have absolutely failed to enforce the
agreement.
This has left too many rural customers in my district with
nonexistent broadband service or service that is far too
expensive. Just this week alone, Spectrum has raised their
rates seven times in just a few years on New Yorkers.
The only solution is to increase competition in our
internet marketplace. This means enacting policies that steer
investment to smaller upstart providers and reducing barriers
to entry.
We must also encourage networks that can host multiple
internet service providers so someone's geography does not
limit their choice. I think we can work on closing this
internet gap and provide choice once and for all to upstate New
Yorkers.
One thing I wanted to ask, I know, Ms. Schaffer, I wanted
to ask you this because you pointed out a couple important
things about getting access to internet. I just first wanted to
ask you about how the FCC data can--the data on broadband
coverage and how it speeds--affects speeds is inaccurate. These
maps are often pivotal to determine if a project is eligible
for Federal funding.
This was raised to me in a recent broadband hearing I had
in my own town of Sherburne, New York, where our business is
located. From what your experience is, can Congress work with
the FCC to resolve this, and can we give some of this
determination on where we are going to allow speeds--can we
give that back to our local communities?
Ms. SCHAFFER. Yes and yes.
So the FCC map is based on advertised speed by Census
block, where one home in a Census block is served, then the
entire Census block is considered served. So that gives--you
know, there are Census blocks in rural America that are many
hundreds of miles, and if one location is served or could
reasonably be served, then that entire Census block is served,
and it is no longer eligible for any Federal funding.
That really puts a--you know, it--that shuts off an
opportunity for those--that area to get funding. They have to
then rely on either local funding or State funding to fill that
hole. And really to get these projects done, you need a capital
stack. You need some Federal money, you need some State money,
you need some local money, you need ISP money. That is really
how rural America is going to get served.
And, you know, one of the things that I recommended in my
testimony is moving this new Federal funds directly to State
programs because State programs are much more responsive to
what is happening.
Our State has a standard--broadband standard of 100 over
100 and an unserved standard of 50 over 10. So we have
recognized the importance of connectivity. And, if Federal
funding flows to States, then States can really craft projects
and with the local people that meets the local solutions and
deals with----
Ms. TENNEY. Let me just----
Ms. SCHAFFER.--many of these issues.
Ms. TENNEY. Let me just reclaim my time for a minute,
because I am running short.
I wanted to emphasize I am concerned about the situation in
New York State where we continue to put millions of dollars
into providing a virtual monopoly to Spectrum Cable, which has
been a huge problem. When I served in the State Assembly, there
was a former Congressman named Chris Gibson in my other
district.
We put tons of money into broadband, and it didn't go
anywhere but to these large entities, and now we have a
problem--continuing to have a problem with rural broadband. My
question is, how do we get the local governments to be able to
participate in this?
And, also, the village of Sherburne has been designated as
a test site to allow this municipal concept that is part of the
bill that--the infrastructure bill President Biden has
proposed, but also give choice and an opportunity for our
consumers to choose their internet and to have actually access
to broadband with minimal rates of speed as determined by the
last farm bill?
I have run out of time. I apologize. I have to catch up
with you on another question.
I yield back, Mr. Chairman.
Chairman GOLDEN. Thank you.
With that, I think we are going to move to a second round.
Mr. Hagedorn, do you have further questions?
Mr. HAGEDORN. Yeah, sure.
Chairman GOLDEN. Okay. Go ahead. I am going to ask some,
too, but I will let you go first.
Mr. HAGEDORN. All right. Thank you, Chairman.
I think I want to associate myself with Congressman
Stauber's comments and, to a degree, also Representative
Tenney's comments on the Biden proposal.
I mean, from my standpoint, if you are going to have 18
States that just can't participate because they already have
restrictions on these municipal broadband networks, that is
pretty darn serious. I don't know why they would put that
forward when basically a third of the country is shut out. I
guess they are trying to be a little top-down on that one. I
disagree. So I think what Congressman Stauber said there was
right on target.
And, also, the telemedicine, I mean, really, if we have
seen anything here in the last year, it is how that has
expanded and the need for it. And the hospitals and providers
have really dug in, and I think the people have accepted it.
And so, from the standpoint of Congress, we need to make sure
that those reimbursements are there. I think this is one of the
few good things that came out of the coronavirus situation, is
the advent of telemedicine.
In the State of Minnesota, every once in a while, we have
inclement weather, believe it or not. What about Maine? I think
same thing in Maine, right? And so, when that happens, it is
easy to still go see your doctor, but also makes it more
efficient for them, seniors, disabled, you name it.
Mr. Waibel, what do you think about telemedicine? Has it
taken off a little bit in your community? Are you seeing more
and more of it? Will it help the people in the rural areas?
Mr. WAIBEL. Absolutely. So one of my daughters is an RN at
a local senior citizens' living place. And, anyway, you know,
so that was used quite a lot during the pandemic for her
patients and clients where she works. And I think, you know--I
even actually used it, too, one time. And it is certainly--it
is a great option to have and something that, again, is going
to be used more and more in the future, I believe.
Mr. HAGEDORN. Thank you.
Mr. Dunne, in your studies and the work that you are doing,
do you see job migration going from urban areas to rural areas
if we can have them on par as far as digital connectivity?
Mr. DUNNE. We absolutely have. There was a lot of movement
pretty early in the pandemic, and, as I think another witness
mentioned, people realized, boy, you know, going back to small
towns might be a lot better than being shoehorned into larger
cities.
But they need to be able to continue their aspirational
jobs. Many times, unfortunately, the narrative has become, if
you want to stay in your, you know, the community that you
love, you have to give up that aspiration and those goals to be
able to do things on a national or global basis.
If you have broadband, that is not the choice you have to
make. You know, the young people who have been supported by
those communities to be able to go off to college can come home
and participate and sometimes bring their jobs with them or
create new businesses based on the experiences that they have
had both in that community and in their experiences outside of
it.
So we do see this as a moment to reverse the population
decline that really we only saw for the first time in a
generation in 2011, 2012, and 2013. Even the farm crisis didn't
lead to a net population loss.
So we are at a moment where we need to move quickly. COVID
has created that opportunity, but we need infrastructure like
future-proof broadband in order to make that a reality.
Mr. HAGEDORN. I appreciate that.
Mr. Sullivan, I want to ask you just a little bit more
about your experience. It is pretty fascinating.
You are serving some rural communities, but what about the
outlying areas where you may have farms. Are you also able to
run the fiber to those locations?
Mr. SULLIVAN. Yes. When we started this project, we made
the commitment or the towns made the commitment that every
single person who had a telephone pole within reach of their
home would be served. So, right now, we have got about 99
percent of both those towns are served. We have got two
outlying areas similar to what you are talking about that we
are working on right now. So, by the end of this year, they
will be connected as well.
So we have got some stretches where we go 6, 7, 8 miles to
get one house.
Mr. HAGEDORN. Well, if Congress wanted to help and make
what you do a demonstration project or expand it, what could
the Federal Government do in order to be helpful, other than
maybe get out of the way?
Mr. SULLIVAN. I think a better understanding of, you know,
what is actually happening out there. And I am going to pick up
a couple of points, one from the Representative in New York
about the cable monopoly there.
That situation is--was allowed to happen. Cable companies
don't compete with anybody. They have got their own highways.
They just basically do what they want, so that is difficult for
other ISPs to come in. So competition doesn't exist.
That is another piece that is another important aspect to
this, is the--to the ranking committee member's comment there
about getting some service to somebody or to everybody, I have
been teaching old and young and rich and poor for over 45
years, and I can tell you, once you drag them over the digital
divide, you get them working, if you build them a network that
doesn't work, they are frustrated, they are angry, and they
won't use it.
It will cause more issues by giving them just something
because the way it works now, without symmetrical connections
up and down--there is more and more stuff being done with
cloud-based computing; you have got to have those uploads. And
those copper-based networks of cable, fixed wireless, satellite
don't have the capacity to do that, and you will basically be
wasting money after money has already been wasted.
Mr. HAGEDORN. Thank you. My time has expired. Appreciate
it.
Chairman GOLDEN. Thank you. I think Mr. Sullivan has talked
about that a lot. Nothing more frustrating than seeing your tax
dollars get put to some kind of internet solution, and then you
still get the spinning wheel, whether you are a student or a
small business owner.
So, Representative Williams, did you want to ask further
questions?
Mr. WILLIAMS. Sure.
Thank you, Mr. Chairman.
Ms. Schaffer, a recent article by the Technology Policy
Institute pointed out that, as the bar gets higher, more areas
become eligible for subsidies while the costs of serving the
truly unserved increases.
Do you agree with this statement?
Ms. SCHAFFER. Well, no. Actually, I mean, I think that--you
know, this is infrastructure that is going to last 50 years, so
we should build infrastructure that is going to meet the
demands of people for 50 years. And, as I said, when you look--
you know, we run a grant program, and, when you are looking at
providing grants, there are many, many ways through scoring
that you can really give advantage to areas that have really
bad broadband.
But it is important when they build it, that they bring it
up to a standard that is going to be essentially future-proof,
and that is what we try to do with our grant program. So I
think you can manage this pretty easily through a grant process
to make sure that the people who have the worst service have
the best opportunity in a competitive grant to get better
service.
Mr. WILLIAMS. Let me have a followup to you.
How do we ensure that we continue to focus deployment for
unconnected areas rather than upgrading systems that are
already in place?
Ms. SCHAFFER. So, you know, one of the definitions of--when
you--even when the FCC defines 25/3 as served, people who have
less than 25/3, you know, are still eligible for that Federal
funding. So you are going to overbuild that network because we
know it doesn't meet today's standards.
And so I think it is important when we look at this to
understand that, first off, the incumbent provider is the most
likely to build--to rebuild their network because they are
there already. So they have the customers, they have the
structure, and so providing opportunities for the incumbent
provider to improve their service, by overbuilding their own
network, shall we say, with better service, is really critical.
And so that is part of trying to figure out how we get
better service to these people. It is not just--every time we
are building networks, it is not like we are bringing--we are
not often bringing in a new provider. We are usually providing
the small local incumbent provider who has been there for a
long, long time the ability to upgrade service that they
already have to the customers they already have.
So overbuilding is really about improving service to
customer bases. Sometimes that is the existing provider that
does it. And, if the existing provider doesn't want to do it,
then sometimes it is bringing in a new provider. But it is
making sure, at the end, with Federal dollars and State
dollars, taxpayer money, that you are providing a service that
can meet the needs of that area for now and into the future.
Mr. WILLIAMS. Okay. Thank you for your testimony, and I
yield the remaining time back to the Chairman.
Chairman GOLDEN. Thank you, sir.
Representative Carter, I think you want to give Mr.
Sullivan a little more time.
Mr. CARTER. Yeah. Sorry. I think Mr. Sullivan indicated he
wanted to respond to one of my questions, but we were out of
time.
Mr. SULLIVAN. Right. I was going back to the--to the idea
about--I kind of answered some of this previously, but we were
speaking about the rural areas and the poor areas where people,
you know, can't afford the service even if it is there. It is
important that the service we do provide everybody in America
is one that works, and that is what I mentioned previously.
That is what I was--kind of shoehorned in my answer to your
question when you ran out of time. But basically my answer to
that is that we need to build networks that work and that will
work for the next 50-plus years, as Peggy said. Doing something
less than that will just frustrate us 5 years down the road.
Mr. CARTER. But would you not agree that, in 2021, the
infrastructure for broadband is as essential as water,
plumbing, electricity? I think we have to be realistic and talk
about those things that are meritorious of funding. And I don't
think we have the luxury. This is not Republican or Democrat.
If there is anything that has ever been bipartisan, broadband
for our country is certainly a bipartisan issue that we can no
longer afford to kick the can down the road.
I feel the frustration of many of my colleagues who have
had it up to their ears with shoddy broadband or no broadband
at all.
Mr. SULLIVAN. Well, that is what we did with the Downeast
Broadband Utility, is we built a utility that is similar to
roads, you know, sewer, water. It is a piece of infrastructure
that we know is not going away. It is only going to get more
and more used. It is going to need more and more robust nature
where--fiber will do that. That is why we are such big
proponents.
And, if you look here in Maine--and this isn't just Maine.
I have been contacted across this entire country by people that
want to set up competitive municipal networks where multiple
ISPs come in and fight for your business. It drives costs down.
It improves service. I mean, it is basically the American
competitive way.
We have allowed forever cable companies to monopolize. We
have enabled phone companies to monopolize. You know, we--the
cable company that--we have Spectrum in Maine. We don't have
Comcast. They don't fight with each other. Comcast says:
Listen, you take New Hampshire; and, Spectrum, you can have
Maine.
That doesn't bring, you know, good service to our citizens.
And I--again, I said in my testimony, a private business should
be allowed to do what they want with their own money, but we
are talking about our money, everybody in this room and
everybody across this country. And I think it is incumbent on
all of us to be in the room when these dollars are being talked
about and not just have the existing ISPs in there pulling the
ears on legislators and people who make the decisions.
You have got to get the rank and file. Bring those farmers
in.
Mr. CARTER. Thank you.
I yield back, Mr. Chairman.
Chairman GOLDEN. Thank you.
Mr. Sullivan, I was actually going to ask just a followup
on Mr. Hagedorn. You talked about how you are getting service
to every door in your community, including, you know, the ones
down the long dirt driveways in the most rural of areas. But
what about the technology Mr. Waibel was talking about with
tractors and such?
Can we provide that type of coverage with fiber like what
you talk about, or is that a satellite-only solution?
Mr. SULLIVAN. Oh, wouldn't I--oh, I am so glad somebody
asked that question. I have been spouting this forever.
If America put fiber on the telephone poles like we did
electricity to every single pole in this country, we could
probably eliminate 80 percent of your ugly cell towers out
there. You can run little mini antennas. Cell towers always
have to connect back to a fiber connection. That is how it
works. There is a few that use microwave, but, by and large, it
is all going back to fiber.
You can put the ubiquitous coverage all over your farms.
You could put them in your distant forests. You could put it
across this entire Nation. We just--we need to have a focus
that says, Let's look at this like electricity. I know that is
like--everybody is bored to death with hearing that analogy.
But it basically is it. We have got to hang these fiber cables
across the entire Nation, and we will solve a multitude of
problems.
Chairman GOLDEN. Thank you.
You know, this is a great--really is, I think, a helpful
hearing. There is a lot of proposals out there. I know--you
know, there has been some discussion about the Jobs Plan put
out there by the White House, but there is also some work being
done in the Senate, and I think recently they announced--Mr.
Waibel, you talked about Representative Thompson's bill. I
haven't seen it, so I will have to look at that.
And then I am a member of the Problem Solvers Caucus, and
we have got a different infrastructure proposal that includes
some broadband as well.
So plenty of room for good compromise.
Some of the stuff, like today, I mean, through what I have
seen in Calais and Baileyville, Maine, I have become a great
believer in what Mr. Sullivan has worked on with trying to
empower localities to take--empower themselves, owning that,
you know, fiber for themselves. And you have done it in a
really unique way, like you said, without raising taxes and
without Federal dollars. It is locally owned.
Ms. Schaffer, I am impressed by the way that your
organization works with the State to leverage private and local
matches, getting the most out of the Federal dollars that are
being sent into Maine. So I think that is something important
for us to look at as well.
And I just had to quickly comment. When you were talking
about advertised speed, man, that is an old problem and one we
talked about in the last Congress, and hopefully we can
continue to improve upon that.
I don't--what is the solution there? Is it--I mean,
obviously just one firm, one house is the problem. Is it a
percentage of people served in the Census block have to have
true access to advertised speed? I mean, how would you unravel
that problem?
Ms. SCHAFFER. Well, first, I wouldn't use advertised speed.
I would use actually delivered speed, because there is a big
difference. What people can advertise and what they can deliver
are two--often two different numbers.
And, really, one of the things that we know about broadband
is it is--you really need granular data. You need it down to
the street level. And Census block level is just not enough.
One of the things that we are doing in Maine and they are
doing in Minnesota is we are doing a crowdsource speed testing
to help inform our data decisions as well as the other data
that we are collecting. The FCC is starting to do that kind of
work, but it is really important that you--when you look at
that kind of data, you are including a customer's voice, you
are including what they are actually getting at their house in
the larger picture of what the data--what the service is
available.
So I would not do--I would not do advertised speeds. I
would do it at a--the closest you can get to the street level.
And the other piece is that you should really audit what
companies are telling you that they are--can provide. So they
say they can provide X. Are they actually providing it? And
crowdsource speed testing is one way you can do that.
Chairman GOLDEN. Thank you.
You know, one thing I have to say about Maine that is
unique is, when we talk about small towns, like, we are talking
about very small towns. As you know, the largest community in
Maine's Second Congressional District is Lewiston. That is, you
know, about 30,000 people. That is our biggest population
center.
But there are, you know, 350 other towns, and some of them
are very small. So that is why we need that flexibility, I
think. And some of these programs are why, as you said, your
organization can be a good approach, or the one like Mr.
Sullivan's community has taken upon themselves.
But I wanted to ask quickly, last question for me anyway,
Mr. Dunne, I see that you--CORI is looking at doing work in
Waterville, Maine. How do you find and invest in communities as
part of the Rural Innovation Network, and as, I guess, a good
example, why Waterville?
Mr. DUNNE. Sure. So Waterville is an extraordinary
community, as you know, that has gone through a transition from
being a manufacturing community to something else. And it was a
tough transition when the textile mills closed and the like.
But a group of leaders, including the Central Maine Growth
Council and some unofficial leaders who just redeveloped some
of those old mill buildings, created cowork spaces, and just
started making things happen on their own. And there has also
been some real leadership from Colby College. And your small,
4-year, you know, liberal arts colleges don't always step up to
be engaged in their community.
Colby College really is, because they know it is critical
to their future, their ability to attract faculty in the future
and to be a world-class college.
So, when we saw all those things coming together and the
beautiful cowork spaces, the redeveloped mill building that is
where Bricks is located, we saw an opportunity. We partnered
with them to help them put together a real strategy plan and to
be able to then apply for federal EDA funding through the Build
to Scale program, which they received.
And so they got some state funding help. They got some
federal funding help. They got local energy that is happening,
and they are in the process of building a high-tech accelerator
program for new businesses. They are doing training programs.
They are engaging students and faculty and folks locally who
are looking for new economic opportunities.
So they found us, and we have just been delighted. We are
also continuing other conversations with communities in Maine
as well.
Chairman GOLDEN. Thank you. I appreciate that.
Any further questions? All right.
Well, I want to thank all of our witnesses again for
joining us today. Your testimony has highlighted how crucial
reliable broadband access is just critical to the small
businesses all over the country, particularly in our rural
areas. So the internet has revolutionized the way that many
small businesses operate. It has allowed them to reach
customers in new markets and save money via new technologies.
The longer certain small businesses don't have reliable
internet access, unfortunately, the further they fall behind.
That is why, here in Congress, we need to work together to find
solutions that facilitate the expansion of broadband
infrastructure.
As we consider broadband infrastructure proposals, we have
got to look to update our digital infrastructure for the 21st
century.
I look forward to working with my colleagues in Congress on
closing the digital divide and evening the playing field for
small businesses.
With that, I would ask unanimous consent that members have
five legislative days to submit statements and supporting
materials for the record.
Without objection, so ordered.
If there is no further business to come before the
Committee, we are adjourned.
Thank you.
[Whereupon, at 11:29 a.m., the subcommittee was adjourned.]
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