Barry Electric Cooperative awarded $6.1 million grant

Wednesday, September 12, 2018

Co-op will be distributed funds to expand internet services over next 10 years

The Federal Communications Commission (FCC) has announced the Barry Electric Cooperative was awarded $6.1 million as a part of the Connect America Fund (CAF) phase two auction.

The grant will be distributed over a 10-year period and bankroll the cost of expanding the goBEC fiberoptic internet and telephone services to local underserved and unserved areas.

“The grant will extend and continue building internet and phone services to the area,” said Mark Aeilts, CEO and general manager of Barry Electric Cooperative and goBEC fiberoptic network. “It’s an opportunity that we couldn’t pass up because we were already looking to build.

“We are in a regulated business with the electric, and that means we have to stay within a certain footprint. We are in an unregulated business with the fiber, phone and internet, so we can build anywhere we want to build.”

The grant will make it feasible for the Cooperative to build way beyond its electric infrastructure. According to Aeilts, after expanding from the electric member territory, the company plans to build underground in public rights-of-way.

“On our electric footprint, we attach to our own poles,” Aeilts said. “But, when we go out past that into non-electric territory is when we will go into the public right-of-way, and the only thing that will be private right-of-way is when we are extending up a driveway to get up to the house.”

The Cooperative is offering 1-gigabit download, and no one they were bidding against were offering that. The closest bid to theirs was 100 megabits.

“First, we originally bought enough capacity of wholesale internet that even when we fully build the member electric territory we aren’t using it all. Second, we also built extra fiber counts throughout the territory so we can build right into expansion of other areas in a broader footprint,” Aeilts said. “We get a lot of requests from outside of our electric footprint to build, and before this grant that was at their cost. Now the grant will fund the construction cost, and we will be able to hold to our same prices if you are in the electric member territory or in non-member territory.”

The Cooperative was already committed to the Barry County build-out for the fiberoptic project, and this will help it extend to the unserved areas.

“The timing is just perfect that they came out with this,” Aeilts said. “In the past, the funding has always gone to large providers, and they got to choose where to spend it in their whole national footprint.”

In this case, the funding was directed to serve southern Barry County, and the Cooperative bid on the areas considered underserved. There are 22 census block groups the FCC divided up in Barry County. Of those 22 groups, the Cooperative was assigned to serve 12 of them.

“That certainly covers the member area, which includes the five towns of Wheaton, Washburn, Cassville, Exeter and Seligman,” Aeilts said. “It also extends to the Jenkins and Shell Knob areas, and all of the areas are north of the lake. We didn’t bid on anything south of the lake.”

Butterfield and Purdy are not part of the Cooperative’s member footprint. However, with this funding, Aeilts said the company can start taking surveys to see who may be interested in having the Cooperative build in that area.

“We believe some of the funding will help with where our electric footprint is,” Aeilts said. “But, this specific funding will help us build in adjacent areas outside of our electric footprint.”

The exact deployment is not regulated by the FCC, but by the carriers themselves. The FCC designated the 12 census block groups, but the Cooperative has to meet the needs of each of the 12 groups.

“Basically, each resident or household within each of those census block groups has to receive service under the terms of the grant,” Aeilts said.

By the third year of support, the Cooperative is required to have 40 percent of the 12 census block groups they bid assigned, and 20 percent each year after until by the sixth year, when it is required to be completed. The grant requires the providers offer internet and phone, however Barry Electric also offers TV services.

The CAF I occurred in 2015, and the Cooperative has been working on its member territory plans since 2015.

“We did not win that auction, however if you were in that first auction, it kind of set the stage by saying this is an underserved area,” Aeilts said. “Three years later, when they did the CAF auction II, it allowed us to be at the table and be able to win.”

According to Aeilts, if Barry Electric had not participated in the CAF I it is very likely the FCC would not have recognized this area as being under served.

“It was some really long-term planning,” Aeilts said. “[Former CEO] Bill Shiveley should get credit for that, and [goBEC Fiber Network Manager] JR Smith, who had all the leg work done by the time I got here in 2017.”

The progression of the goBEC project will not be affected by the grant’s work in expanding the network. According to Aeilts, there is some overlap because there are territories that the Cooperative bid on in the auction that it was already building to serve.

“We are absolutely thrilled to be serving more of Barry County at a reasonable cost,” Aeilts said.

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