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Building a Better Future for Rural Residents Starts With High-Speed Internet

In 1935, only 11% of America’s rural homes had electricity. That low figure prompted President Franklin D. Roosevelt (FDR) to create the Rural Electrification Administration, which would serve as a loan agency to cooperatives in an effort to provide electricity to rural America.

“FDR spoke of rural electrification and what it meant to people in those communities. He said it was ‘a modern necessity of life – not a luxury. That necessity ought to be found in every village, in every house, and on every farm in every part of the United States,’ ” says Secretary of Agriculture Sonny Perdue. 

Today, 900-plus electric cooperatives serve 42 million people in the U.S, and 2.5 million miles of electric distribution lines covering 56% of the nation’s land service over 19 million homes, schools, businesses, and farms. 

While FDR’s 84-year-old message was about electricity, the same can be said of high-speed internet today. 

“Rural America doesn’t have the essential ingredient today, which is communication,” says Steve Foshee, chief executive officer, Tombigbee Electric Cooperative located in Hamilton, Alabama. “We’re a communication world. So much of rural America, and certainly rural Alabama, is lacking the ability to have access to basic broadband services. It’s the issue for rural America in the 21st century.”

Founded in 1941 by nine Alabama farmers determined to improve the quality of life for those living in Marion, Lamar, and portions of Fayette counties, the cooperative is building on what was initially created. It is working to bring reliable, high-speed fiber to the rural northwest Alabama communities it serves.

“Our mission is the same today as it was for those nine farmers when they fought for their right to have electricity,” says Foshee. “We’re fighting to improve the quality of life in a different way, but in a way that is just as important.”

John Raines, senior vice president of global commercial for The Climate Corporation, agrees. “This is an investment in the future of America and, frankly, our ability to compete in a worldwide market.”

From Our January Issue: Guest Editor Sonny Perdue, Secretary of Agriculture

Why this story matters to me: "Having reliable broadband connectivity is something that many Americans take for granted, while millions of others live without it. In order to ensure every American has access to broadband, federal, state, and local entities, both in the private and public sector, need to work together. Tombigbee Communications in Alabama is an excellent example of a local business doing its part to expand connectivity in its community.” – Sonny Perdue

a shocking statistic

Yet, Tombigbee’s quest to bring this service to the area hasn’t come without its challenges – and a very large price tag.

Steve Foshee
“We’ve been looking at this issue since 2008,” Foshee explains. “Initially, we were looking at a $40 million project. We did a feasibility study and filed for stimulus money in 2010. While we thought we had an outstanding application, it did not get funded. After years of work, we were discouraged.”

Disillusioned, the initiative was shelved. Yet, the issues facing the state’s rural communities continued to deteriorate. 

“In Alabama, the per capita income is about 40% lower than the national average. We are lower than the state average in this area,” he says. 

As the opportunities and population steadily decline, the average age of its citizens, which is 49, is on the rise. “If the folks in your congregation are getting more gray hairs and you’re not hearing any crying babies, that’s a problem,” Foshee says. 

A shocking statistic presented at a conference of the state’s electric cooperatives highlights just how dire the situation is. According to the Public Affairs Research Council of Alabama, 26 of the state’s 67 counties are dying. 

“Our entire service area is on that list,” he says. “We knew we were hurting, but to see the word dying really gives us a clear perspective on what we are facing. This is a battle for survival in rural northwest Alabama.”

The shrinking population in Lamar county hasn’t gone unnoticed by resident Will Gilmer. “There has been a steady decline for the last 15 years,” says the fourth-generation farmer. “Yet, we still have the same amount of roads that have to be maintained. If we don’t get our population trends reversed, what infrastructure we have is going to fall apart worse than it already is because we won’t have a tax base to maintain it.”

foundation for change

The cooperative believes its ultra high-speed internet service called freedom FIBER is the foundation for winning that battle, but reviving these rural communities is a complex problem.

“Will building a fiber network save us in and of itself? The answer is no, but it is a critical component,” Foshee says. “We can build it, but it’s what we do with it that will make the difference.”

Will Gilmer
Having a beefed-up connection not only will improve education for young people so they can gain the necessary skills and knowledge to be competitive, but also will create opportunities to advance health care. In addition, Gilmer says it will help ignite economic development by retaining existing businesses and, hopefully, attracting new ones.

The Sulligent, Alabama, dairy farmer, who farms with his father, David, knows firsthand how the lack of a high-speed connection affects a business.

“Trying to use DSL is extremely frustrating,” says Gilmer. “Improving connectivity means our efficiency would go up because we would be able to better manage things like how we monitor our cows when they’re getting ready to calve.”

If he does need information while he’s in the barn or shop, the majority of the time he’ll use his cell phone. However, even that isn’t completely reliable because of low spots and trees interfering with reception. When he can get a solid signal, trying to review information on a small screen isn’t always ideal. “That’s particularly true when we’re working in the shop and we’re trying to pull up schematics on a tractor to diagnose a problem.”

Like many dairy farmers today, the Gilmers’ long-term prospects for staying in dairy aren’t good. As they contemplate the future of their family farm, the services Tombigbee is offering open up new opportunities. “Whatever direction we decide to go, a fiber connection gives us the ability to look at and try new technology,” he says. “It’s hard to even wrap my mind around what the possibilities could be. It will be exciting to see where the fiber can take us.”

“We are convinced data and data science are going to transform agriculture once again,” says Raines. “In order for farmers to be able to have the type of information that provides those forward-looking insights to the farm, they have to have reliable, robust connectivity.”

five-phase plan

In January 2017, the cooperative developed a new business plan and created Tombigbee Communications to move a five-phase fiber project forward.

Phase one, which was an $8 million investment, extended fiber to two communities: Winfield and Hamilton. “If we weren’t successful in these towns, we knew we weren’t going to be successful anywhere else,” says Foshee. “We had to be sure – and this is why we’re implementing it in phases – that people wanted what we were building.”

Not only was adoption successful, numbers were tracking so well (around 15% above goal with nearly 45% participation and well under the projected budget) that the board voted halfway through phase one to move forward with phase two, which has a $6.4 million price tag.  

“While I can’t divulge what the final cost was for phase one, what I will say is that we cut what we had initially projected by more than half,” Foshee says.

Tombigbee also reapplied for the USDA Community Connect Grant and was awarded $2.9 million in 2018. The program provides funds to bring high-speed broadband to rural communities where there is not yet a business case for private providers to deliver service. 

“This grant is in keeping with President Trump’s directive that we use all available tools to increase prosperity in rural America,” says Perdue. “As we pursue economic expansion, we recognize broadband is no longer a luxury. It is a necessity.”

The program requires a minimum bandwidth of 25 Mbps/3 Mbps, which are the benchmark speeds the FCC adopted for broadband connectivity. However, Foshee asserts those speeds are not future-proof.

“I would argue that the minimum today will not be good enough for tomorrow,” he says. “We built electric lines to last 20 years. We have to take the same approach with broadband. If we set the bar too low, we will have missed the greatest opportunity to make a difference in rural America.”

Tombigbee is offering residents two speeds: 100 Mbps/100 Mbps for $49.95 a month or 1 Gbps/1 Gbps for $79.95 per month. Businesses will receive 10 Gbps with varied rates depending on a company’s specific needs. In addition, the service is not metered or data capped.

Phase two, which is currently under construction and partially funded by the grant, will cover a portion of the rural areas in Marion and Lamar counties as well as the town of Haleyville. 

“I am happy to report that our board recently approved phase three, which is a $13 million investment,” says Foshee. “It’s also the largest phase of our plan.”

This portion of the project will continue to expand into the rural areas of Lamar, Marion, and Fayette counties, with a good portion of the 420 miles to be laid in Lamar County. Gilmer Dairy Farm is included in this phase, and it should have access to fiber by the middle of 2019. 

“We know when we get to the more rural areas, we are going to lose money,” says Foshee. “In our case, our rural areas average four customers per mile of line. An average city is 25 customers per mile of line.

“Investments from USDA, key partnerships with companies like CoBank, and a close eye on our financials are all crucial to successfully servicing these rural communities,” he says.

The company currently has over 3,000 customers and is connecting about 70 new customers a week. “We have a 5,000-customer-long waiting list,” he adds. “We can’t build this fast enough, which is a fascinating problem.”

To date, Tombigbee has installed approximately 600 miles of fiber with another 1,100 to go. The original plan called for all five phases to be completed in three years. Foshee thinks they can accomplish it in 2½ years. Once finished, he expects the company to see around 65% adoption across 1,000 square miles of northwest Alabama.

“The argument in the 1930s was that rural people were too poor to afford electricity and too uneducated to use it. The same thing is being said about broadband,” says Foshee. “By providing a fiber connection as good as anywhere else in the world, we can change the negative narrative about quality of life in rural America.” 

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