When Dayton commented on the state's $1.87 billion budget surplus, he recommended that Minnesota allocate $100 million in grant funding for rural broadband development. If that funding is approved by the state Legislature this spring, the current grant program would require applicants to at least match the funding offered, which means the state may soon see a total of $200 million in rural broadband funding.
The Minnesota Office of Broadband Development (MOBD) launched in January 2014 and has since managed $30 million in investment, leading to the connection of more than 10,000 homes and businesses, said Danna Mackenzie, MOBD's executive director. If the Legislature votes to make this funding available before the regular session closes at the end of May, the office expects an additional 20,000 to 30,000 homes and businesses would gain connectivity. A different bill seeking $100 million in broadband funding in 2015 was cut down to $10 million by the Legislature.
Following the FCC's 2015 revision of the definition of broadband, which is a download speed of 25 Mbps and an upload speed of 3 Mbps, Minnesota achieves roughly 90 percent broadband connectivity statewide and rural connectivity of about 70 percent.
"One of the other things we're seeing is providers coming in with applications that are middle-mile only," Mackenzie said. "They're seeing this as an opportunity to push their backbone deeper into the rural areas."
The state's estimates of what the funding can do are just estimates, Mackenzie said, because while connecting some areas can be done relatively cheaply, others are more expensive, and it's hard to know how far the funding will stretch until work begins.
