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Don’t Hobble the Little Guys (Editorial)

2 min read

The good economic development news in Arkansas includes the state’s commitment to connecting homes and businesses to high-speed internet. Since 2019, the Arkansas Department of Commerce Broadband Office has awarded $392 million for 163 projects to connect homes and businesses, Senior Editor Mark Friedman tells us in his Page 1 story. 

The not-so-good-news is that a proposed new state funding formula could deter efforts to expand broadband access as well as prevent smaller internet service providers from participating in the push. The formula proposal would give grants only to providers that can cover 25% of the upfront costs of expansion projects. The state currently awards grants for full project costs.

“The economics don’t work for us,” Alan Morse, chief of Ritter Communications of Jonesboro, told Friedman. Connecting a remote house can cost up to $30,000, Morse said. That means that Ritter’s out-of-pocket cost would be $7,500. And that, he said, is more than many Arkansas companies would be in a position to advance.

“Unfortunately, it may be the large national companies that have traditionally underserved the state” that end up getting the grants, Morse said. 

The rules will have to be approved by the Arkansas Legislative Committee. There may be more to this proposed change than we know, but as it stands now, we have to hope the committee will weigh the hurdle that this 25% upfront policy puts in the way of smaller providers and consider removing it.

And speaking of economic development: Sequretek, a cybersecurity firm based in India, last week announced plans to open its U.S. headquarters at the Little Rock Technology Park, bringing 50 new jobs to the city over the next three years.

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