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USDA Loan Program Supports Broadband Development in Rural Areas

August 18, 2014

USDA Loan Program Supports Broadband Development in Rural Areas

By Casey Houser
Contributing Writer

A federal government program dedicated to providing funds for urban communities will soon find cities in Minnesota, North Dakota, and Texas constructing new and improving existing broadband services.

According to an official report from the U.S. Department of Agriculture, the USDA Rural Utilities Service's Telecommunications Infrastructure Loan Program awarded $40 million in loans to rural communities in the states listed above, and local officials will be using the money to increase voice, video, and data access, as well as improve existing access, in those locations. Agriculture Secretary Tom Vilsack commented on the importance of broadband services to people who work and live in the U.S.

"Broadband is essential to the economic strength of rural communities," Vilsack said. "It improves access to education and quality health care, and it leads to new jobs and business opportunities. Broadband is part of everyday life in most of America and vital for economic success in the 21st Century. Rural America cannot be left out."

Several companies will be bringing such services to a number of communities throughout the three states. The Community Telephone Company will use $26.4 million to replace copper lines with new fiber lines in Texas. The Red River Rural Telephone Association will use $8.5 million to construct a fiber optic network in Abercrombie, Colfax, Fairmount, Great Bend, Hankinson, Lidgerwood, Mooreton, and Wyndmere in North Dakota and in Barnesville and Rollag in Minnesota. Furthermore, The Griggs County Telephone Company will use $4.7 million loan launch fiber services in Binford and Cooperstown in North Dakota.

Fiber optic networks are showing growth across the globe. In the U.S., its overall penetration of 7.7 percent is somewhat smaller than in other developed countries, but it is expanding, and that is happening in no small part because of initiatives such as those driven by the USDA. Fiber optic networks can be expensive to install, initially, and that causes hardships for many rural communities that do not have the capital to expend on system installations or upgrades.

USDA has marked its program as an investment in the "backbone of our American values." Beyond morals, however, consumers and businesses know that access to high-speed networks can drive corporate investments and allow cities and educational facilities to remain connected.

The loan program discussed here has a history of helping rural communities develop their broadband infrastructures. Most notably, the news release states, the Dakota Central Communications Cooperative received $2.2 million from the fund in 2010. That money went toward development in the North Dakota towns of Gackle and Streeter, and today they can boast a network size of 10,000 square miles, 18,000 homes, and more than 400 rural subscribers.

Edited by Maurice Nagle
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