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DANC considering internet service loans

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High-speed broadband Internet is a luxury unavailable to many rural dwellers in the north country, as telecommunications carriers often don’t find it profitable enough to provide services here.

The Development Authority of the North Country aims to address that problem, however, by enticing carriers to extend service with a $1 million pot of low-interest loan funding. The north country telecommunications loan fund will offer funding for projects in rural communities in Jefferson, Lewis and St. Lawrence counties.

The revolving fund includes $500,000 from the Connect New York Broadband Grant program acquired this year, and a $500,000 match from the authority.

The Board of Directors will vote Thursday on establishing the fund; if it is approved, the authority then will accept loan applications from Internet carriers, local governments and industrial development agencies. Loans could be available for up to $500,000 per applicant (including affiliates). Interest rates on the five-year loans will be calculated by subtracting 2 percentage points from the prime lending rate as gauged by the Wall Street Journal, now 3.25 percent. Projects must be situated in underserved areas with no more than one telecommunications carrier.

James W. Wright, the authority’s CEO, said the funding will aim to attract local telecommunications carriers, such as Slic Network Connections and Westelcom, as well as recruit providers outside the region. These so-called “last-mile” carriers, which directly connect services to customers’ homes, will partner with the authority by linking to its “middle-mile” network in the tri-county region. That 750-mile open access telecommunications network connects to the region’s major telecommunications lines, extending east to Plattsburgh and south to Syracuse.

Most future broadband projects are expected to be developed in St. Lawrence and Lewis counties, because of their diverse geography and scattered populations, Mr. Wright said. Jefferson County also has rural pockets without broadband.

“The problem with last-mile deployment is always the ease of (projects), which is hindered by the geography and number of people” the carrier is going to reach,Mr. Wright said. “If we have a pool of money that’s available, (carriers) could provide additional communities with access to the network. There are new people in the telecommunications arena that are now trying new technology and a new means of deploying it.”

David M. Wolf, telecommunications division manager for the authority, said several carriers have expressed interest in expanding services to rural parts of the north country. If carriers successfully apply for funding in the next six months, he said, it’s possible that projects could be completed in 2014.

“We’re hoping that in the next three to six months we have a couple of them that want to do it, and our goal would be next year to have people connected to the network,” Mr. Wolf said.

Targeted areas will probably include pockets of about 100 to 150 homes outside of population centers, he said.

Areas without broadband Internet access include much of western St. Lawrence County and southern Lewis County. Some areas in northern Jefferson County, between Clayton and Philadelphia, are also without access.

“Our preference would be to go where there’s no one providing services,” Mr. Wolf said. “We’re finding a portion of some areas are served, but not the rural parts outside it. So we’re hoping that carriers will work with us” to reach those homes.

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