Bug Tussel asks for $12M more to finish broadband

By Kevin O’Brien Bug Tussel, a telecom company working to expand high-speed internet access in rural Marathon County, is asking the county board to issue an additional $12 million in conduit bonds so it can finish installing fiber optic cable across the county by the end of the year.

The county originally signed off on $78 million in conduit bonding in 2021 as part of a five-county partnership with Bug Tussel. Of that total, $25 million was earmarked for broadband expansion efforts in Marathon County.

Since then, however, the company says it has run into several delays due to an underperforming contractor that had to be replaced and underground rock that made cable installation more expensive. Costs have also gone up due to inflationary pressure, as the demand for materials and labor has increased, according to the company.

Scott Feldt, executive director of public affairs for Bug Tussel, told the Infrastructure Committee at is June 6 meeting that the company is “working hard on catching up,” with six crews of 30 workers installing fiber in various locations, including the Athens, Hamburg and Little Chicago areas. He said Bug Tussel is on track to complete the countywide broadband expansion, plus a second project in the Leather Camp area in Kronenwetter, by the end of this year.

So far, the company has 16 towers activated, with seven more in various stages of development, and 182 miles of fiber conduit laid.

The committee was presented with an initial resolution to authorize up to $250 million in industrial revenue bonds – in conjunction with Fond du Lac, Calumet, Jackson and Waushara counties – with $12 million designated for work in Marathon County. With the counties serving as conduit borrowers, Bug Tussel benefits from lower interest rates

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but is responsible for making all of the debt payments.

As part of the original 2021 deal, the county receives a fee based on a percentage of the outstanding bonds (currently $50,000 twice a year), plus access to 24 strands of fiber for county usage, and space on Bug Tussel’s towers for its own communication equipment.

Supervisor John Robinson, chair of the county’s broadband task force, said $5 million is needed to complete the countywide project and $3 million for the Leather Camp area. With capitalized interest and reserve funds factored in, the total request comes to $12 million, he said.

Robinson said the county is not putting itself at risk by increasing the bond amount, noting that a two-year reserve fund has been put in place.

“If they start missing payments, we have more than adequate time to adjust,” he said. “We are secured with the commitment of their assets. The fiber and the towers would become ours in the event of a default, which we are not anticipating.”

Supervisor Chris Dickinson said he was not happy to hear that Bug Tussel is asking for more money, especially after the company “wasted” so much time trying to increase the miles of fiber it planned to install. He also said town officials in the western part of the county tried to warn the company about how much heavy rock it would encounter when laying fiber.

Dickinson noted that the request for an additional $12 million is nearly a 50 percent increase over what the county originally authorized, and he wondered if even more money would be sought in the future.

“That is a concern for me, whatever that number might be,” he said.

Feldt said he understands Dickinson’s frustration, but he assured the committee that Bug Tussel is committed to finishing the project by the end of the year with the extra funds it’s requesting.

“You are absolutely justified to express concern, because we have been behind schedule, as well as the cost going up,” he said.

A motion to advance the initial bonding resolution passed unanimously, but Dickinson said he only voted yes so it could be discussed by the entire county board. The resolution will also be reviewed and voted on by the Human Resources, Finance and Personnel Committee before going to the board.

If the initial resolution is approved by the board at its June 18 meeting, a final resolution requiring a three-quarters majority vote would come before the board in September.