What does blended finance for broadband look like? Look at Macon, Alabama.
Written by Brian Vo | Read the original article on connecthumanity.fund.
Connect Humanity was founded with the belief that, by bringing the right partners to the table, it’s possible to collaboratively structure investments for sustainable broadband networks in communities that have been short changed when it comes to digital infrastructure.
Today, we’re announcing an investment in a fiber network in Macon, Alabama that shows what this blended financing can look like.
Blended finance meets community needs
As part of its mandate to promote development, the Macon County Economic Development Authority (MCEDA) has been working diligently to expand internet access in the county, where 40% of families have lacked access to home internet at broadband speeds.
With support from Rural LISC, MCEDA entered into a Public Private Partnership with rural internet provider Point Broadband to build out a fiber network that would deliver quality, affordable broadband to families and businesses across the county.
While MCEDA lined up substantial philanthropic and state grants, more funding was needed to make network economics stack up. And so Connect Humanity worked to structure a finance package that fit MCEDA’s constraints, providing additional funding and making the network economics work for Point Broadband to bring its own capital to the mix.
The result is a truly blended finance package that combines public subsidies, philanthropic grants, in-kind make-ready construction from a local utility, investment from the service provider, and Connect Humanity’s impact dollars. This investment enables the build of a +$3 million fiber network that will connect nearly 1,400 additional homes, businesses, and community institutions.
Securing long term benefits for the community
The deal includes a community benefits agreement, designed to ensure that Point makes good on its promise to deliver reliable, quality broadband for all residents within the project area. The agreement establishes safeguards, reporting requirements, and a committee of community stakeholders that will work to meet Macon County’s connectivity needs over the long term.
Where networks remain in private hands, agreements like this included as part of financing terms, can help safeguard digital equity benefits for communities. It provides a mechanism for accountability to avoid affordable rates turning extractive, promised service that never happens, or new network owners without consulting the community. Ultimately, it’s about ensuring that the needs of the community remain at the center of decisions.
Huge kudos to Point Broadband for its community-centered approach and engaging with the county in the way it has.
A network already delivering returns
The network has already demonstrated how foundational connectivity is to socio-economic growth and development with a number of early wins for the area, including helping attract a new auto parts manufacturing facility and enabling a partnership between Tuskegee University and telehealth company OnMed. This is just the beginning of what will be a game-changing investment for residents in Macon County.
Read the press announcement to learn more about the partnership:
$3 million+ partnership brings next-generation broadband to Macon County
A new partnership pools government, private, and philanthropic funds to build fiber internet for county residents and businesses
3 May. Tuskegee, Alabama – A next-generation fiber broadband network has been completed in east central Alabama thanks to a partnership between the Macon County Economic Development Authority (MCEDA), Rural LISC, Connect Humanity, and rural internet service provider, Point Broadband.
The organizations have come together to raise $3.1 million, including state and federal grants, to fund a fiber broadband network that significantly improves internet service in the county, where, until now, more than 40% of households have not had access to a wired or fixed-wireless connection at broadband speeds (25 Mbps) according to FCC data (1), and even more households have struggled to afford it, according to a recent census survey (2).
To change this, Point Broadband has built a new network that expands access to almost 1,400 additional Macon County homes, as well as businesses and community institutions like libraries and educational and healthcare facilities. The network offers access to better service, lower costs, and ‘gigabit’ speeds up-to forty times as fast as the best alternatives on offer.
For MCEDA, which led the initiative, the project provides a transformative opportunity to drive long-term economic growth and improve the well-being of residents. Joe Turnham, Director at MCEDA said: “We’re building broadband fit for the future and the County is already realizing the benefits. From healthcare innovation at Tuskegee University to $140+ million in economic impact from the area’s newest jobs-engine — Tuskegee Commerce Park — this network is bringing opportunity to businesses and families across Macon County.”
The network has secured a number of early wins for the area, including helping attract a new auto parts manufacturing facility and enabling a partnership between Tuskegee University and telehealth company OnMed, providing remote care on campus for students, faculty, and the wider Macon County community.
David Ficken, Point Broadband’s Vice President for Strategic Growth said, “Point Broadband is pleased to join MCEDA in this innovative partnership that combines community focus, world-class technology, and funding to bring broadband to Macon County and other neighboring communities. Point Broadband is committed to improving lives through fiber technology across the country and it’s very satisfying to make such a big impact right here at home.”
Point has entered into a community benefits agreement with the County, with safeguards and reporting requirements to ensure the network continues to provide quality, affordable service to residents, businesses, and community institutions along the project route. The agreement establishes a committee that will work to meet Macon County’s connectivity needs over the long term.
Brian Vo, Chief Investment Officer at Connect Humanity said: “Macon County is showing that it’s possible to build gold-standard internet service in rural and low-income communities. When willing partners come together to invest, we can build networks that meet the needs of families and businesses — and that are financially sustainable over the long term. This investment isn’t just for broadband infrastructure; it’s for improved health, more access to economic opportunities, and, ultimately, greater wealth creation for the community. Connect Humanity is excited to be part of it.
The project leverages public investment and philanthropic grants to secure private capital from investors who might otherwise see such projects as too high risk. This ‘blended capital’ approach stretches the impact of state and federal broadband subsidies and ultimately leads to more infrastructure being built and more families being connected.
“Rural LISC is thrilled to be part of the change that brings much needed broadband infrastructure to thriving rural communities like the one in Macon County,” said Caitlin Cain, LISC Vice President and Rural LISC Director. “Unique public-private partnerships have proven to be instrumental in catalyzing large-scale change that strengthens education, workforce opportunities, access to telehealth and a host of other benefits that directly support rural-based community investment.”
MCEDA Director Joe Turnham, added: “The project has brought together a phenomenal collaboration of diverse partners, from the State of Alabama, Utilities Board of Tuskegee to Point Broadband, Rural LISC, and Connect Humanity. The journey has been rewarding, and underlines the opportunity for public-private partnerships to provide impactful connectivity in challenging rural environments. From the businesses being served — including Samkee America, Inc., and our new logistics park — to the many families now able to access world-class connectivity, this project is generationally transformational for our community. Thanks go out to all our stakeholders who helped make this happen.”
