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Published in Economic Development
Holland voters to decide broadband internet bond proposal COURTESY OF HOLLAND BPW

Holland voters to decide broadband internet bond proposal

BY Tuesday, July 26, 2022 07:26pm

HOLLAND — City of Holland voters heading to the polls next week will determine whether to allow the city to bond for up to $30 million to build out a publicly owned, fiber broadband internet network.

City officials, along with several businesses and the area’s economic development organization, support the proposal that they say promotes competition among internet service providers, lowers costs for customers and advances economic development.

“I think we experienced — just like most of the world did during the pandemic — that having high-speed, reliable internet is not just a want, but really a need for participating fully moving forward,” said City Manager Keith Van Beek. “We think it’s something that is a competitive advantage and something that’s good for our citizens and our businesses.”

On Aug. 2, city voters will decide on whether to allow the Holland Board of Public Works (BPW) to bond for the construction of a citywide broadband internet network. The proposal would not only allow BPW customers to receive 1-gigabit internet service through the utility, but the open network system also would allow for private internet service providers to join the network.

“It’s community-owned infrastructure that we are inviting, hoping and expecting the private sector would use and increase competition,” Van Beek said. “And that it would provide more choice, which would create a faster, more reliable internet system. Typically we know competition also has a positive impact on cost.”

Van Beek said examining ways for BPW — which provides electricity, water, waste and limited fiber optic services — to provide citywide broadband services “has been, I would say for probably at least five years, one of the top priorities of our City Council.”

If approved, construction on the fiber network would begin in the fall of 2023 and finish in about two years. City officials expect the service to cost about $45 per month under a 51-percent take rate, while the millage would assess property owners $1.50 per each $1,000 of their property’s valuation.

However, critics say the proposal is a potential waste of taxpayer dollars on a system that should be built out by private companies.

Ted Bolema, a resident in nearby Park Township who also serves as executive director of the Institute for the Study of Economic Growth at Wichita State University, is among the critics. He pointed to some cities — including Traverse City — that have struggled to gain enough subscribers to support the cost of operating a publicly run system.

“It’s the whole general idea of the government going into business with private competitors who are then having to compete with the government,” said Bolema, who also serves on the Mackinac Center for Public Policy’s Board of Scholars. “It’s a dislike for the general approach.”

Bolema also questions whether private service providers would be interested in investing in a city with a publicly run network, and whether the network would be technologically obsolete by the end of the 25-year millage. And if some residents are having trouble affording or accessing services, the city should help these residents access a privately owned provider on a more targeted basis, Bolema argues.

Van Beek said he doesn’t “follow the logic” of opponents’ criticism of other cities’ publicly owned broadband since the city is asking voters for permission to bond out to build it, rather than it being funded purely from subscriptions. 

“That system would be paid for by the bonds we would pay, and would be reimbursed through the millage question we’re asking for. That’s a solid source of revenue for that infrastructure,” Van Beek said. “Then there’s not a need for a certain number of people to sign up for the system or anything like that.”

Millage supporters also say the infrastructure would last long term by supporting even higher connection speeds.

Jennifer Owens, president of economic development organization Lakeshore Advantage Corp., personally sees the need for faster internet options. Owens and her husband have three sons, including two teenagers, who complete a household with a “ridiculous” number of devices, she quipped.

“We continue to see the internet crash repeatedly,” Owens said. “We’re excited about an increase in speed and the opportunity to bundle all of our bills together in one place.”

Owens also supports the millage on a professional level, seeing the plan as an economic development tool to support talent attraction and business growth.

“Our team really sees broadband and investments in broadband as really an investment in the third utility that’s necessary for businesses and talent to operate,” Owens said. “The ROI for broadband has a very significant impact on the future of the community’s economy. A lot of that is driven by manufacturing here, and changes with smart manufacturing, robotics, big data and all of the equipment that’s connected to the internet — it requires a lightning fast connection and speed. The better connection we have for businesses and residents, the more we have to compete and be successful.”

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Read 1609 times Last modified on Wednesday, 27 July 2022 00:24
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