Clark County rejects broadband service plan
The Clark County Board of Supervisors last week narrowly voted down a proposal from a broadband internet provider to bring expanded service to the county at competitive prices for customers. The proposed project would not have cost the county anything and in fact would have brought in revenue, but the county would have had to lend its borrowing authority to the company and take on financial risk if the company defaulted.
On a 20-8 count, the Board at a July 21 meeting at the Courthouse in Neillsville voted in favor of the proposal from Bug Tussel Wireless, but a three-fourths majority (22 votes) was needed because it involved adding to the county’s debt load. Bug Tussel was asking the county to use $15.7 million of the county’s borrowing authority, in exchange for installing 190 miles of fiber optic lines and 10 towers throughout the county to improve broadband capabilities. Bug Tussel, which is under similar contract with at least 12 other counties in the state, said it needs to use this financing method because counties can get better interest rates and longer borrowing terms, giving Bug Tussel the time and capital it needs to build out its network.
Bug Tussel is looking to spend as much as $240 million in participating counties over the next few years to expand internet services that it says it will then sell to residents and businesses at lower rates than they are now paying for less effective or even non-existent services. The Clark County portion would have cost an estimated $18 million, with a Public Service Commission grant to cover $2.3 million. Bug Tussel was then asking to use $15.7 million of the county’s debt limit to fund the work here. In exchange, Bug Tussel would pay the county an annual sum that would start at $62,000 the first year and decrease each year as loans were repaid. The county would have received a total of approximately $1.2 million over the 30-year loan life as its guaranty payment.
Prior to the Board vote, Citizens State Bank of Loyal president/CEO Travis Holt cited a prime example of why better broadband is needed in the county. During the recent three-day run of Wisconsin Farm Technology Days near Loyal, the cell phone traffic load was too much for the current system to handle. The number one comment Holt said he heard from people attending the show was, “We couldn’t make a phone call.”
“I couldn’t make phone call out of my office in the bank all week,” Holt said.
Holt said he understands that the county would be taking on some financial risk under the Bug Tussel plan, but added that Hilbert Communications -- which owns Bug Tussel -- is in strong financial shape.
“The assurances that they did provide were substantial,” he said. “I do believe it’s in the best interest of the county” to approve the proposal.”
Town of Fremont Chairman Rick Marks said his township on the eastern side of the county needs better, more consistent service. During the COVID-19 pandemic when schools went to virtual education, some of the families in his area had insufficient or no service at all.
“How can you have a township that divides its educa- tion by where you live?” Marks said.
He also cited the tele-health service trend as another reason better wireless service will be needed.
“Let’s use the technology that’s available,” Marks said. “Give it a try. This is the shot that we’ve got. We’ve gotta be a part of this big package. I don’t want to be the isolated island.”
Steve Schneider, Bug Tussel co-founder, president and CEO, said his company needs county financial backing for this venture so it can spread its capital costs over 30 years and eventually make its investment back through selling internet services to customers. Once the system would be operational -- hopefully by late 2023, Schneider said -- Bug Tussel would sell its high-speed download/upload services at lower rates than residents now pay for slow service.
“You’re paying one, two, three times what we’d be charging,” Schneider said.
The risk for the county, he said, is if Bug Tussel/Hilbert Communications would not honor its commitment. In that case, he said the county would own the fiber optic network and towers. The tax impact for the loan repayment would be about $30 annually on a $100,000 home.
“The worst thing that can happen is we default on this and never make a payment,” Schneider said. The best case scenario, he said, is that Bug Tussel builds its network and service is improved for a lower cost.
“We’re not doing this for the first time,” Schneider said. “We’ve been doing this for a long time under this methodology.”
Schneider also said this plan should appeal to Clark County because its part of Bug Tussel’s emphasis on bringing better service to rural areas.
“We’re focused on rural markets only,” Schneider said. “I’m doing this because it irritates the crap out of me that rural areas are the last to get everything.”
Supervisor Fred Schindler of Curtiss, who voted in June against advancing the Bug Tussel proposal for further consideration, said he has changed his mind.
“I’ve come a long ways in the fact that this can really benefit Clark County,” he said. “I think it’s gonna serve a good many people.”
With a map of the Bug Tussel fiber optic network/tower location on the screen in the Board room, Schindler said, “The big benefit I think is right in front of us here. Anybody passing through the county will have better cell service.”
Not all supervisors saw the benefit of the plan as outweighing the risk. Board Chairman Wayne Hendrickson of Unity said he does not believe the county should be in the financing business.
“I don’t like guaranteeing someone else’s loan for 30 years,” he said. “Nobody ever guaranteed my loans when I was farming.”
Board Vice-Chairman Joe Waichulis of Thorp said he doesn’t think the county should jump at the first proposal it considers.
“I want to see who else is out there,” he said.
Supervisor Duane Boon of Neillsville said he is bothered by the fact that Bug Tussel was willing to agree to contract “concessions” in a meeting held the day before the full Board vote. He said the Board should take more time to consider the proposal.
“If it’s a good deal today, it’ll be a good deal tomorrow,” he said.”I don’t know what’s going on anymore.”
Supervisor Jim Smagacz of Neillsville questioned Bug Tussel’s pledge to keep consumer prices low. Nowhere in the proposal does it commit to that, he said.
“Are they going to go up the minute this gets passed?” Smagacz said.
After the vote to adopt the proposal failed, several supervisors asked about the county’s future direction for better broadband. The Board has a Broadband Committee that has been looking at options for years, but county IT director Mitch Weber said no funding has ever been made available.
“If we’re not going to invest in it, it’s just going to drag on forever,” he said.
Supervisor Ashley Thielman of Colby said the Board missed a chance to move forward.
“We sit and we spin and we spin and we spin,” she said. “I don’t understand what other alternative there is. We have no other alternative. I don’t know how we advance.”
