Background & History

What exactly is being proposed?

ECFiber, a group of 22 local municipalities, in partnership with ValleyNet, (VN) a Vermont non-profit organization, is planning to implement a high-capacity fiber-optic network capable of serving 100% of homes and businesses in participating towns with Internet, telephone and cable television service. The ECFiber municipalities have formed an Interlocal Contract (ILC), registered under Vermont Law, to undertake the project.

It would be financed by a loan from the Federal Government under the recently passed "Stimulus Program" known as the American Recovery and Reinvestment Act (ARRA). This loan will be administered by the Rural Utilities Service (RUS), the successor to the former Rural Electrification Administration (REA) which is a division of the US Department of Agriculture. In order to accept this loan, ECFiber ILC has formed a wholly-owned Limited Liability Company ("ECF-LLC"). The proceeds of this loan, and future revenues of the network will be held by a Trustee on behalf of ECF-LLC. The trustee will act as the "paymaster" and will disburse funds to VN, contractors, creditors, etc. according to explicit instructions. Under this mechanism, there is no risk and no liability to the municipalities themselves. The sole collateral of the RUS loan is the ECF-LLC and the network it builds.

Why is this project important?

Our country has a rich infrastructure - if you are talking about roads, electricity, and telephones. However, the United States is far behind other countries in providing ubiquitous broadband access. South Korea, Sweden, Japan, France, Finland, and even Iceland are significantly ahead of the US (and far ahead of the Upper Valley) in the availability of broadband access. Most recently, Vermont has been ranked 47th among all U.S. states, in terms of the average broadband speed available in the state.

A universally-available service based on state-of-the-art optical fiber ("Fiber-to-the-Home" or "FTTH") would provide far superior service at lower cost than that provided by any other system. This would have great advantages to residents, as well as town governments, schools, businesses, and non-profit organizations, and would improve the region's attractiveness to high-tech industries and the home-based businesses on which the Upper Valley's economy will increasingly rely.

One clear beneficiary would be our school systems. In Burlington, which has a municipal FTTH network, the schools have been able to significantly improve their Information Technology capabilities at a lower overall cost. Ultimately, a universal network would provide important curricular and educational opportunities.

What is ECFiber?

The East Central Vermont Community Fiber Network (ECFiber, ECF, or ECFiberNet) began as a grassroots community-based group working to bring modern, affordable Internet and telecommunications access to all residents, business, and institutions within our community. Over the past two years, volunteers from a growing list of towns in east-central Vermont (now twenty-two) investigated the various ways of responding to local demand for high-speed access. Having weighed all options, they concluded that a community-owned and operated fiber-optic network is the best solution, both technically and financially. Accordingly, ECFiber was created as a legally-constituted InterLocal Contract (ILC) pursuant to Vermont Law. It has a Governing Board consisting of one representative and an alternate appointed by the Select Boards or City Council in each of the 21 member towns and one city. The Governing Board adopted by-laws and has elected an Executive Committee and officers to carry out the normal business between the regular Governing Board meetings.

ECFiber established a partnership with ValleyNet, a community-based non-profit 501c(3) in White River Junction, VT, that has been serving local customers for years, to develop a business plan, secure financing, and build and operate the network. Burlington Telecom’s founder and former director, Tim Nulty, joined ValleyNet to lead this effort.

Why fiber?

Optical fiber-to-the-home (FTTH) is "future proof"; with almost infinite capacity. As such, it is literally the communications highway system of the future. Having this kind of universal, open access, financially and technologically sustainable infrastructure is one of the most important economic development initiatives a community can and must undertake at this time. Without such infrastructure, rural communities in particular will be left behind as the rest of the world moves rapidly in this direction. Today, very few businesses, schools, medical facilities, etc. can compete or operate effectively without access to this level of communications service.

Fiber-optic cable supplies not only the fastest Internet available but also can offer low-cost phone and cable TV services services as well as multiple other services such as real-time two-way video in-home medical care, real-time two-way video education, home security, "smart homes" (that enable remote management of heat, appliances, power usage). Compared to copper -based DSL and cable systems, fiber is many times faster, has far greater capacity, and is cost-effective to install and maintain. Because fiber is lashed to a high-tensile cable, it is less susceptible to breakage and weather events. As a hard-wired solution, it is not vulnerable to the shortcomings of wireless technologies. In the future, fiber optical technology can distribute such applications as medical monitoring, fire alarm protection, energy optimization, etc.

Isn't Fiber uneconomical in rural areas?

No. Fiber is the cheapest way to bring universal, reliable service to all parts of America. It is, in fact, cheaper than the copper wires we extended to every American home 100 years ago.

Why community-owned?

None of the major private network providers has offered to make ultra-high-speed service 100% available. As a community-owned project, this network will be available to every single household, business, and public institution within the ECF territory. Because it is a "last-mile" solution, it reaches to customers in remote parts of town including those on class 3 and 4 roads. In fact, it is ECFiber's pledge to bring fiber to every home that is reachable by a current copper telephone wire. Moreover, because it will be community-controlled, customers will be protected from unreasonable price hikes. All jobs created by ECFiber will remain in Vermont-there will be no "outsourcing" and the towns can expect profits with which to meet local expenses and reduce property taxes.

How did this effort get started?

Most of the region's town committees got started working with Al and Laura Duey, who work as project managers for the Vermont Council on Rural Development's Vermont Rural Broadband Project. Al and Laura have attended many meetings in towns all over Vermont helping people to get organized.

Many of the ECFiber towns started with a survey to determine what the interest level was in getting high-speed internet. All of the surveys received positive results. For the towns that started committees in 2007 or before, many were looking at wireless solutions as a best option. Strafford even got as far as building a network. With a wireless network in mind, Tunbridge grouped together with the committees from Vershire, Chelsea, Royalton and Thetford to form the East-Central Broadband Project.

After the Pomfret Area Project received a response to its Request for Information from Burlington Telecom in the spring of 2007, Al and Laura Duey floated an email to the group about the Fiber-To-The-Home option pioneered by Burlington Telecom. In terms of quality of service and longevity a fiber network looked very interesting. They set up a meeting with Tim Nulty of Burlington Telecom in May of 2007 and invited all of our surrounding towns.

After this initial meeting with Burlington Telecom the interested parties grouped to form a 14-town committee called the East-Central Vermont Community Fiber Network.

As the group investigated the project further, it became apparent that the original idea of connecting to Burlington Telecom's hub was not going to be a viable option. Since then ValleyNet, an Upper Valley-based non-profit, hired Tim Nulty (previously Burlington Telecom's CEO) to work with this community organization to build a network and hub.

There are now 22 east-central Vermont towns who are officially members of the ECFiber organization and project.

How long have people been meeting?

Some towns have been at it since 2007 or before, others came on board once the idea had hatched and organizing was underway. The first Fiber-To-The-Home meeting was in May 2007. The most important "birth date" was Town Meeting day, 2008 when all the ECFiber towns voted overwhelmingly to join the ECFiber initiative.

Is there a model for a community-owned network? Where has this succeeded?

There are approximately 35 municipally-owned "full-service" (offering phone, internet and TV) FTTH networks currently in operation around the USA. Most of these are based on a single municipality. ECfiber towns did not have this option because none of them are large enough to undertake an enterprise of this magnitude and sophistication. However, Vermont has a rich history and experience of groups of towns working together to do things (Libraries, schools, fire protection, solid waste disposal, public transportation, water supply) that are too large for individual towns to undertake. It is this history that forms the basis for the ECFiber project. Virtually all of these full-service municipal FTTH networks are successful. In Vermont, Burlington Telecom (BT) is a municipally-owned telecommunications network which began connecting customers in early 2006 and now has over 4000 customers. It is operationally cash-flow positive and expects to be profitable when it reaches 5000 customers sometime early in 2009. BT’s former CEO, Tim Nulty, has joined ValleyNet, and is advising the ECFiber project. Tim Nulty is also a selectman in Jericho, VT.

Is the federal government doing anything to expand broad band coverage?

Until recently, relatively little. With the passage of the Stimulus program (ARRA), the Federal Government has moved strongly to support the extension of broadband to rural America. While the ARRA program is still very new and has numerous "bugs and glitches" that are to be expected with a large new initiative, it is a sign that the Federal Government is no longer going to sit idly by while the USA in general-and its rural areas in particular-fall further and further behind the rest of the world. The old "Rural Electrification Administration" (REA) program, initiated by Roosevelt during the depression, was the engine that brought electric power and telephones to rural America in the 20th century. Hopefully, the ARRA will do the same for broadband in the 21st century.

Why should towns get involved in providing telecommunications services? Wouldn't the private sector do this better?

Universal broadband communications access is fast becoming a necessity, much as public roads, electricity, and telephone service. All these now universally available necessities were built with some form of public support or subsidy. Private providers invest in infrastructure in regions with greatest density, and in Vermont, they have publicly stated their lack of interest in low-density rural areas. The investment plans they have announced have been very small, relative to the need and demand.

Won't this project have an unfair cost advantage over private providers?

The fiber-to-the-home network will pay the same franchise fees, pole attachment costs, and taxes as existing providers. Any town support would be paid for at "arms-length" prices. With respect the Federal ARRA program: any private company is free to apply for the same financing that ECFiber is seeking. But, at least in ECFiber's territory, no one is offering to use these funds to provide universal, open access service. This is the unique characteristic of ECfiber and derives directly from the fact that it is community owned. Committing to universal, open-access service increases costs compared to a "cherry-picking" strategy of only serving the most profitable areas. This extra cost more than compensates for any perceived "advantage" that ECFiber may be alleged to have compared to private providers.