Grant will wire Arrowhead with nation-leading broadband

More than $80 million in federal broadband grants announced today will bring high speed communications to virtually every home in Lake and Cook Counties and parts of eastern St. Louis County.

The grants will make the three counties among the first in the nation with that level of connection. Combined, they will connect 37,000 residents, 1,000 businesses and 98 institutions such as hospitals and schools.

The projects were included in a list of 43 new broadband infrastructure awards approved by the U.S. Department of Agriculture's Rural Utilities Program. They'll go a long way towards bringing broadband service to long under-served Northeast Minnesota.

Universal broadband access has become an increasingly important issue for rural parts of Minnesota and the nation. Residents see it as a key to economic development and quality of life improvements. Advances in education, medicine, government services and other fields have many rural residents fearing they will become second-class citizens without adequate access.

At a public forum last month sponsored by Sen. Amy Klobuchar, Gunflint Lodge owner Bruce Kerfoot lamented that he could make a reservation in minutes at a lodge in a remote village in Switzerland -- but no one could do likewise at his Gunflint Trail operation because he has no ready service.

The Federal Communications Commission has made universal access part of its national broadband plan, but getting high-speed access to remote areas like Cook County is expensive and doesn't draw investment from industry.

That's why local leaders are ecstatic about the federal money. One of the awards brings $16 million to Cook County's Arrowhead Electric Cooperative. An "Ultra High Speed Broadband" report last year by a governor's task force identified Cook County's internet access as worst in the state.

Joe Buttweiler, who directs membership services with the Lutsen-based Arrowhead Electric Cooperative, said 70 percent of the federal award is a grant and the remainder a loan. He said the cooperative will add another $600,000 for capital.

The money aims to "provide a fiber optic service to every home and business in Cook County that currently receives service from Arrowhead Electric Cooperative, or that's within the City of Grand Marais," Buttweiler said.

Providing broadband to every home is a big leap for Cook County, where only 37 percent of the residents now have high speed access.

Service will include new telephone and high speed internet, and possibly high definition television.

Buttweiler said broadband has become an economic necessity.

"We have a serious economic issue in Cook County," he said. "People are unable to work from home. We have people here that currently own seasonal cabins and would like to move here full time, and have the opportunity to work from home, with the exception of their inability to have high speed internet access."

Without broadband, Buttweiler said, local schools cannot provide the same educational services that better connected schools can. Local hospitals want better connections to their counterparts in Duluth.

Fear of being left behind economically for lack of broadband is a widespread concern in rural parts of Minnesota and the country. The latest grants come on top of the more than $150 million in federal broadband funding for Minnesota.

The Lake County sponsored project will receive $66 million to connect residents countywide, including some in eastern St. Louis County. With local participation, that project is close to $70 million.

Lake County Commissioner Paul Bergman said the new system comes with redundant connections -- additional lines that can move signals even if a key line is broken. Last January, a severed fiber optic line in Duluth killed phone and internet service in an area of more than 150 miles up Lake Superior's north shore.

At Bergman's Vanilla Bean cafe in Two Harbors, credit cards stopped working when the lines went down.

"Absolutely cash only," Bergman said. "You know, when people come up to visit they want to use their credit card."

Bringing in parts of St. Louis County also helps make additional connections on the Iron Range.

Bergman said Lake County's broadband service will include phone, internet and high definition television. He said the system will provide fiber options to every home and business - giving the rural county a big jump on others nationwide.

The system will provide download speeds up to 100 megabits per second, about 100 times faster than anything currently available.

That's undoubtedly good for the region's economy, according to Lee Munnich, an economic development expert at the University of Minnesota. Still, Munnich said, broadband alone isn't going to create new business.

"It'll be sort of up to the people in those communities, and maybe some of the business leaders to help in thinking through what might be some of the specific opportunities," Munnich said. "But it sounds like a real advantage to me."

The federally funded projects are expected to create nearly 600 jobs in the short term and be complete within three years.

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