Neighbors Providing Service to Neighbors: Vermont’s Approach to Community Broadband
Tuesday, June 4, 2024
Digital Beat
Neighbors Providing Service to Neighbors
Vermont’s Approach to Community Broadband
In 2019, the Vermont Department of Public Service found that nearly a quarter of Vermont addresses lacked service that met the then federal benchmarks for broadband speeds (25/3 megabits per second, or Mbps). The COVID-19 pandemic only underscored the urgent need in a state that has consistently ranked near the bottom of connectivity comparisons over the past decade. Vermonters saw a lack of interest from private providers to invest in the sparsely populated rural state and recognized that communities needed to address the problem themselves.
To help communities organize themselves to address their broadband needs, Vermont turned to an existing model in the state: a Communications Union District (CUD). Similar to public utility districts that communities have relied on around the country to build water or electricity infrastructure, CUDs are formal partnerships among multiple towns to build communications infrastructure. Where a single community may struggle to address its broadband needs, CUDs can create larger, more feasible markets and allow towns to share resources and raise funds. They are led by a board composed of volunteer residents from the member towns to ensure responsiveness to community needs. Through these CUDs, Vermonters in 216 of the state’s 252 towns are combining forces to improve broadband access for their communities. It is, as State Representative Laura Sibilia (I–Windham-Bennington) puts it, “neighbors providing service to neighbors.”
Communications Union Districts
CUDs are organizations of two or more local governments that join together to build telecommunications infrastructure together. CUDs are similar to regional utility districts that provide other essential services like water and sewage infrastructure to mostly rural communities. CUDs aggregate demand across multiple towns, making the market dynamics more feasible and efficient. Further, because the regional district owns or oversees the infrastructure, projects can have longer return-on-investment timelines. And though the CUDs cannot access the property taxing authority of member towns, they can access the municipal bond market to raise money.
Vermont's very first CUD began as a limited liability company. In 2008, 23 towns in East Central Vermont voted to form ECFiber to build a community-owned, open-access network that would provide fiber-to-the-home service. Community members—the network’s future customers—were the original investors in the network.
Stan Williams and F. X. Flinn, who were central to ECFiber’s inception, recount how raising additional funds for the network build was difficult because their then-novel “intra-local contract” was, they discovered, difficult to explain to lenders. They lobbied for the creation of CUDs as a legal framework so they could be more credible on the municipal bond market. Vermont legislators formalized the CUD model in 2015, transforming ECFiber into a CUD.
Act 71 Opens the Door to Expanding CUDs
The COVID-19 pandemic pushed Vermont to direct serious resources to CUDs. Recognizing the stark need of broadband, State Representative Sibilia co-sponsored Act 71 in 2021 to accelerate community broadband development. Act 71 established the Vermont Community Broadband Board (VCBB) as an entity to support the formation of CUDs and channel the emergency funds that were becoming available. The legislation also relaxed the rules to form CUDs. Prior to the law, member towns had been required to vote in a town meeting to form a CUD. But after passage of Act 71, a CUD could be formed through the vote of a town selectboard itself.
Act 71 recognized the needs for community action and mutual aid at the town level. At its core, the legislation is focused on universality and accountability, with the state placing the CUDs as “unofficial providers of last resort” and situating them—with hundreds of millions in future broadband infrastructure funds—as the central vehicles through which the state intends to achieve universal broadband service. Furthermore, Act 71 went beyond federal broadband benchmark speeds and set the goal of 100/100 Mbps symmetrical service.
There are now ten CUDs in various stages of operation. Of Vermont’s 252 municipalities, 216 participate in a CUD, representing 76 percent of the state’s population and 93 percent of the residences that were unserved by adequate broadband in 2023.
In addition to ECFiber, three other CUDs—NEK Broadband, DVFiber, and CVFiber—had begun offering broadband service by 2023, and the other six districts are in various phases of planning and network design.
Community-Driven Solutions Focused on the Public Good
Vermont is a small state, made up largely of small towns—Burlington, its largest city, has fewer than 45,000 people. A smaller scale of operations has been crucial to the development and functioning of this community-driven solution.
"Vermontiness" and Volunteerism
VCBB is administering nearly $250 million in American Rescue Plan Act grants to CUDs and will also oversee the $229 million in federal BEAD funding allocated to Vermont
Ensuring Provider Accountability
In part related to the limits of volunteerism and in part because of the makeup of the markets, many CUDs have looked to existing ISPs as partners to provide service to their regions. The terms of these partnerships differ in each case, as outlined in the report, but even CUDs are not building and running the networks themselves, district leadership is focused on a strong and enforceable commitment to accountability to their member towns, no matter who their provider partner is.
A key to a district’s success is its ability to find strong, community-minded providers willing to form partnerships. Such partners have tended to be smaller providers. Some CUDs took an "accountability by contract" approach, which can include mechanisms such as quarterly service reviews, outage reporting requirements or attending board meetings when requested.
Focus on the Public Good
Exporting the Vermont Model
Other states are also adopting or considering a regional utility district model. Maine and New Hampshire seem to be the furthest along in following in Vermont’s footsteps, Like the VCBB, Maine's state broadband office is providing well-designed planning grants, early technical assistance, creatively designed financial aid, and other tools for communities.
While the foundational work performed by broadband champions and CUD boosters in the state made for a unique constellation of energies, much of what made Vermonters pursue a community-driven solution is present elsewhere:
- rurality,
- declining populations (especially of young people),
- a culture of independent thinking,
- strong ties to surrounding communities,
- the understanding that better access to broadband can also mean better access to education, health care, and economic opportunities, and
- the collective sense of being stuck with providers more interested in shareholder return than community priorities.
Vermont’s experience can offer years’ worth of hard-earned lessons for rural communities around the country that are just now assessing their options and preparing themselves for the BEAD investments in the coming years.
Read more about Vermont's broadband story in Neighborly Networks: Vermont’s Approach to Community Broadband a new publication from the Benton Institute for Broadband & Society and the Institute for Local Self-Reliance.
Ry Marcattilio is an associate director for research with the Institute for Local Self-Reliance’s Community Broadband Networks Initiative. He is interested in the democratizing power of technology, systems engineering, and the history of science, technology, and medicine. Previously, Ry worked as an adjunct professor of American history in Oklahoma, Rhode Island, and Minnesota. Ry holds a Ph.D. in American History from Oklahoma State University.
Revati Prasad is the vice president of programs at the Benton Institute for Broadband & Society overseeing the Institute’s programmatic and research work, including the Marjorie & Charles Benton Opportunity Fund fellowship program. Dr. Prasad holds a Ph.D. in Communication from the Annenberg School for Communication at the University of Pennsylvania and an MPA from Columbia University’s School of International and Public Affairs.
The Benton Institute for Broadband & Society is a non-profit organization dedicated to ensuring that all people in the U.S. have access to competitive, High-Performance Broadband regardless of where they live or who they are. We believe communication policy - rooted in the values of access, equity, and diversity - has the power to deliver new opportunities and strengthen communities.
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