Mark McKinney can hardly go anywhere while wearing a Jackson County REMC shirt without being asked when high-speed broadband internet will be hooked up in their area.
So far, 730 miles of fiber have been installed by employees of Jackson Connect LLC, a not-for-profit division of Jackson County REMC.
Jackson County customers in the areas of Sauers, Wegan, Tampico and Cortland and Owen, Pershing and Salt Creek townships have been connected, and those in Reddington, Dudleytown and Uniontown should have it in the near future.
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Member participation had to be high for the project to be a success, said McKinney, president and chief executive officer of Jackson County REMC.
So far, so good.
“For Phase 1 that we started, the feasibility study said we would be at 30% take rate after 12 months. We were at 68%, so yes, the people wanted it,” McKinney said.
On May 29, a year after the first customer was hooked up to the internet service, Jackson Connect had its 1,000th connection. The family was presented with a gift card to celebrate the milestone.
“It was just a numerical milestone that we were able to reach,” McKinney said, noting the 100th and 500th customers also were recognized when they were connected.
“For the amount of work that each particular connection takes, that’s a lot,” Matt Persinger, vice president of broadband services and technology for Jackson County REMC, said of the significance of the milestone.
The project, announced in June 2017, involves installing fiber optic line on existing utility poles and then to the homes of REMC’s 20,000-plus customers.
Construction of the smart grid project started in October 2017.
Then in March 2018, Jackson County REMC received a $74 million loan from the U.S. Department of Agriculture to finance the project. The work has a $59,331,071 price tag, and the remainder of the loan will be used to build 60 miles of electrical line, improve 10 miles of existing electrical line and make other system improvements, Persinger said when the loan was announced.
A couple of months later, the first customer was being connected near the REMC office in Brownstown.
At the start of this year, REMC received a $5 million tax abatement for a 6,000-square-foot addition to its office. McKinney said that was needed because of Jackson Connect continuing to create jobs for people.
Fourteen people have been hired so far, and he plans to hire an additional 16 by the time the project is complete, which is expected Sept. 1, 2020.
“Everything you see going on around here is due to this fiber project,” McKinney said of construction outside the office.
The project will leave the REMC with additional room for growth if another expansion is needed, he said.
“I’d say the critical piece that allowed us to do it for such a big area is that we first put in our 220-mile fiber backbone that has basically circled or looped our entire service territory,” he said.
Jackson County REMC serves consumers across 10 counties in southern Indiana, spread over 2,925 miles. Its consumer base includes more than 1,000 commercial and industrial and 80 irrigation consumers in Bartholomew, Brown, Clark, Jackson, Jefferson, Jennings, Lawrence, Monroe, Scott and Washington counties.
“Once that was in place, we were able to basically go anywhere and do installs, and that was driven on member interest and favorable interest from the county officials,” McKinney said. “Basically, they were willing to give us tax abatement. That gives us a pretty good incentive to go on in there.”
When the project is finished, nearly 2,000 miles of fiber will be installed, McKinney said.
“We did a full-blown projection of a five-year financial forecast, and we’re fairly on target, but we’ve also decided to ramp up the process to make this five-year project in something a little over three,” he said.
“We’re going to continue to escalate not only mainline construction but installations, and I attribute the success of that to the employees we’ve been able to hire,” he said. “We’ve been able to attract and retain some really good talent and made significant difference. Without them, this project wouldn’t even exist.”
Persinger said the project could be further along if they sacrificed quality, but they aren’t willing to do that.
“Right now, we’ve taken the experience of that first year of actually hooking people up, and along the way, we’ve tweaked processes, tried to make everything more streamlined, and we’re just going to take that and multiply that by two or three times to try to boost output to try to do more of that same work in the same amount of time over the next year,” he said.
McKinney said the REMC board wanted to first focus on providing the high-speed internet to members, and once they are served, then the company can look at providing it to those outside of their service area.
Persinger said electric service territories are defined by statute, so they can’t serve people who aren’t in their electric service territory. With the broadband and fiber side, though, they are not mandated to stay within that, so they can branch out.
“Since our members are footing the bill, we feel obligated to get them service first,” Persinger said.
McKinney said REMC is only providing broadband connection, not video or telephone services.
“We felt like that goes back to our original roots in the ‘30s when we provided electricity. We didn’t tell you which appliances to hook to it, but we did teach you how to utilize those appliances efficiently,” he said.
“We’re taking the same philosophy to our broadband project, and while we’re not providing over-the-top streaming, we will teach you how to use an Amazon Fire Stick or a Roku Stick and get Netflix or we’ll teach you how to use a Voice over IP telephone solution a lot more cost effective for the members,” he said. “That way, let them understand what they can and can’t do with this broadband connection.”
In July, REMC will find out if it’s awarded funding through the Indiana Next Level Connections Broadband Grant Program. McKinney said Indiana Gov. Eric Holcomb has set aside $100 million for statewide broadband initiatives.
REMC also is in the process of applying for funding through the ReConnect Loan and Grant Program. McKinney said the company is applying for 50% loan, 50% grant.
Both grants are for unserved areas, he said.
“They are not providing any funding for overbuilding areas that already have access to broadband,” he said.