Arkansas’ full-tilt race toward broadband expansion hit a bump in January. But OzarksGo, the Fayetteville company that’s helping anchor a statewide fiber-optics push by Arkansas’ electric cooperatives, remains in stride.
A subsidiary of Ozarks Electric Cooperative Co., OzarksGo connected its 35,000th customer just before the end of the year, and has made speedy internet, television and phone service available to nearly 90,000 homes and businesses connected to the cooperative’s wires.
OzarksGo is also working to start offering high-speed services beyond its traditional footprint, although a number of broadband projects statewide were paused last month by the arrival of Gov. Sarah Huckabee Sanders’ administration at the Capitol.
“We are working to build outside of our network in our existing territory,” said OzarksGo General Manager Steve Bandy. “We started last year to do some of that, and we received some funding to expand out. But of course, we’re really waiting to see what happens at the state broadband office as more funding comes in. But we will continue to build either way.”
A week and a half ago, a panel of lawmakers tapped the brakes on Arkansas Department of Commerce plans to put $53.3 million of American Rescue Plan funds into eight broadband projects, seven involving electric cooperatives or their subsidiaries.
The performance evaluation and expenditure review subcommittee of the Legislative Council “hit the pause button” after the new governor issued an executive order Jan. 17 revoking American Rescue Plan steering and advisory panels established by her predecessor in the governor’s office, Asa Hutchinson.
Senator Predicts Approval
But Sen. Jonathan Dismang, R-Searcy, told Arkansas Business last week that he expects all the projects to be approved swiftly, perhaps as early as this week. “We’re in session, so PEER can come in and meet at any time to approve those,” Dismang said Tuesday in a telephone interview. “They probably would have been approved this week if not for the weather.”
The grants on hold involve rural broadband build-outs in Ashley, Baxter, Chicot, Clark, Columbia, Hot Spring, Logan and Lonoke counties. The governor’s action did not affect OzarksGo, which made no bids on projects involved in the last round of requests for money allotted in the American Rescue Plan and Infrastructure Investment & Jobs Act.
But the grants do involve OzarksGo’s partners in Diamond State Network, a new wholesale broadband provider armed with a $1.8 billion investment in fiber infrastructure by the state’s cooperatives. The network is looking to cover 72 of the state’s 75 counties with 50,000 miles of fiber lines through 13 of Arkansas’ distribution cooperatives or their subsidiaries.
The largest grant on hold is $14.2 million dedicated to a $19.6 million broadband endeavor in Logan County by Wave Rural Connect, a subsidiary of Arkansas Valley Electric, and Cox Communication LLC. Next were a $10.9 million outlay for a $14.7 million Lonoke County project by Connect2First Internet of Jacksonville, a subsidiary of First Electric Cooperative, and a $6.6 million grant to Ashley-Chicot Electric for an $8.8 million project.
The only affected project without cooperative involvement was a $7.9 million grant to CableSouth Media LLC of Crossett for a $10.7 million build-out in Ashley County.
The cooperatives, and certainly OzarksGo, are looking ahead.
“The Electric Cooperatives of Arkansas are eager to continue our efforts to improve the quality of life for rural Arkansans by delivering reliable, affordable broadband services,” said Rob Roedel, director of corporate communications for the Electric Cooperatives of Arkansas. “We understand the need to ensure that proper plans are in place so our 1.2 million members are served with this generation’s version of life-changing technology. We look forward to working with the governor and the Arkansas General Assembly to improve the quality of life for electric cooperative members.”
Bandy, of OzarksGo, called high-speed internet a critical service in the 21st century, in cities and rural areas.
In an interview last year, Arkansas Electric Cooperatives CEO Buddy Hasten said building out broadband pays off beyond giving members better home offices, telemedicine opportunities and education. It was an easy addition as utilities revamped their electric lines with smart-grid technology.
“If it costs $100 to put in a batch of smart-grid fiber, it costs just $100.03 to put in extra fibers that we can use for broadband,” Hasten said. “We take those extra fibers and sell them [as wholesale broadband capacity], so the electric customers aren’t subsidizing anything; they’re actually getting paid for the fiber.”
Cooperatives are not-for-profit utilities, but all revenue helps offset members’ bills or goes back to them at the end of each fiscal year.
Bandy said OzarksGo’s ability to connect 35,000 customers in five years was a huge accomplishment. “We’re a couple of years ahead of what we had forecast, and have really outperformed our initial financial forecasting,” he said. “I think it shows the need for fiber broadband in rural areas, that people are hungry for it.”
OzarksGo offers a gigabyte of symmetrical service, and it’s all fiber straight into the home or business. Multigig service options are expected within the year.
“We’re up to 70 employees, plus numerous contractors that help in installation and construction,” Bandy said, adding that five years ago there was just one employee. “And we’re hiring within the communities we serve.”
About 95% of customers are residential, the rest commercial.
“One key point is that the technologies coming out are really allowing people to work and live in the communities where they want to be,” Bandy said. “And I think the economic growth that can be driven off of that is going to be huge.”