The Benefits of Public-Private Partnerships in Expanding Rural Broadband Access

Expanding broadband access in rural areas poses unique challenges for private internet service providers (ISPs) and governments alike. The combination of small populations spread out over large geographic areas makes it difficult to install the necessary infrastructure, while the limited customer base makes it harder to offset the high costs involved. However, local leaders in states are finding a potential solution in the form of regional utility districts, a partnership model that combines public sponsorship and private resources to bridge the digital divide.

One opinion that resonates with many is that rural broadband is best built with private capital through public-private partnerships. This approach allows for the leveraging of government resources and expertise and sponsorship, while also providing private ISPs with the necessary incentives to invest in these high-cost areas. By pooling their resources and expertise, both public and private entities can work together to overcome the economic challenges associated with rural broadband expansion.

An excellent example of this partnership model can be found in Vermont, where ECFiber, a community-driven effort, successfully connected rural areas to high-speed internet. In this case, villages and towns banded together to form a regional utility district, known as ECFiber, to oversee the development and maintenance of the infrastructure. By utilizing public-private relationships, ECFiber was able to attract private capital and secure loans at lower interest rates, making the project financially viable.

Pennsylvania is another state wherein local leaders have embraced the public-private partnership approach to rural broadband expansion. Through the formation of public-private entities, local leaders aim to connect underserved areas to high-speed internet. By combining local government sponsorship with private investments, these public-private entities are able to overcome the economic challenges of serving rural communities.

In conclusion, the economics of rural broadband expansion are challenging, but public-private partnerships, such as regional utility districts and cooperatives and other joint entities, offer a promising solution. By leveraging government resources and attracting private capital, these partnerships can overcome the high costs associated with installing infrastructure in rural areas. As more states explore this collaborative approach, we can hope to see greater connectivity and economic opportunities for rural communities across the country.

Source: The Pew Charitable Trusts – Vermont Takes a Regional Approach to Rural Broadband Expansion, https://www.pewtrusts.org/en/research-and-analysis/issue-briefs/2023/01/vermont-takes-a-regional-approach-to-rural-broadband-expansion, January 5, 2023.

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