Making Public/Private Partnerships Work for You—and Your Revenue Stream 3/26/2012.
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Transcript of Making Public/Private Partnerships Work for You—and Your Revenue Stream 3/26/2012.
Making Public/Private Partnerships Work for You—and Your Revenue
Stream3/26/2012
U-reka Broadband Ventures
• Boutique Consulting Firm focused on facilitating next-generation broadband deployment in rural areas
• Directly raised $36 million in ARRA Broadband Stimulus funds
• Participated in another $100 million in funded projects providing Engineering, Operations and Environmental review expertise
• www.u-rekabroadband.com
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What is the opportunity?• As consolidation happens at the Tier 1 and Tier 2 level
many of these companies lack the resources or interest to improve service in rural communities
• Cable Television companies still only remain interested in serving denser communities (Doughnut Hole)
• Cities and Counties (municipalities) are becoming increasingly frustrated at the lack of communication and commitment to their communities
• Cities and Counties are looking for options to remain competitive in the global marketplace
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What do Municipalities have to Contribute?
• Passion for their community– Local Champion– Desire to see their community remain relevant
• Ties to their community– Economic Development– Education– Healthcare– Public Safety
• Financial Resources– Bonding Authority– Other in-kind financial benefits
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What are Municipalities looking for?
• Expertise– Many rural Municipalities are not interested in
becoming the phone company, ISP or video provider• Trusted Partner– Someone who has a local reputation– Neighboring Service Provides can fill that need
• An Exit– Not necessarily interested in owning an asset for 30
years that they do not understand– Continue to be responsible to their constituents (Do
not want to end up in a financial hole)
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Role of Service Providers
• Bring Operational Expertise • Provide Backbone Services– Often leveraging existing network assets– Can speed time to market
• Sales and Marketing Expertise• Financial Expertise• Access to additional funding sources– USF – RUS
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What is a “Typical” Process?
“There is no Typical Process, Each is Different”• Municipality engages a Consultant– That “can speak the language” of both parties
• Municipality creates Momentum– Community Meetings– Meets with Existing Providers– Meets with Potential Provider Partners (often looking
to share cost of feasibility study dollars)– Secure dollars to move forward with a Feasibility
Study
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Process Continued• Feasibility Study Completed (includes):– Market Study– Anchor Institution/Shareholder meetings– Engineering Study– Operational Study– Financial Modeling– Suggestions for Moving Forward
• Sharing of Feasibility Study information with Leaders and the Community
• Municipality and Service Provider begin Negotiation of Working Relationship and Funding
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Project Success Example
• Farmers Mutual Telephone and Lac qui Parle County
• Went Through Process to Secure $9.6 million in ARRA Project Funding
• Project Video
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Intangibles of Working with Municipalities
• Very Creative-come up with new ideas to get out there and help you grow the customer base
• Economic Development Benefits-Service Provider becomes an integral part of any business retention or attraction efforts
• Long-term Partners-they are not going anywhere soon!
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Lac Qui Parle Project Statistics
Fiber Miles 374
Square Miles 339
Buildings Passed 1738
*Critical Community Facilities 12
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Main Benefits
LAC QUI PARLE COUNTY• Economic Development – Fiber-To-The-Premise (FTTP)
throughout the county
FARMERS MUTUAL TELEPHONE
• Expand territory and customer base – which reduces operational costs per customer.
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Partner Contributions
• Farmers Mutual Telephone Company was recipient of stimulus funds of $4,826,478 Loan and $4,826,478 Grant for this project
• Lac qui Parle County will contribute funds as needed to repay debt on cash flow basis
• Farmers Mutual Telephone Company will build out project and operate the business.
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For Additional Information
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John SchultzBooth 37 Exhibit Hall
www.u-rekabroadband.com