Charlemont Municipal Fiber Network
Selectboard Status Report
December 1, 2019
Summary
Based on the current estimated completion dates from National Grid and Verizon, we are anticipating construction of the distribution network will begin in late 2020. We hope to begin rolling out service to parts of town in the first quarter of 2021 and have service in all parts of town by the end of 2021. We have received invoices for all of our initial make-ready applications and have applied for additional state funding, specifically an advance of $438,000 from the Last-mile Contingency Fund. We are continuing to work on preparatory tasks to allow us to put the distribution network construction out to bid early next year. Installation of the conduit and vault outside of the town hall is done. Construction on the network equipment room should begin soon. All permitting for the railroad crossing on the west end of Tower Road is complete. Design of a new railroad crossing at Long Bridge is still in progress. We are ready to contract for several construction projects through WG+E in the spring (Hawk Hill Road, Heath Stage Terrace, Tower Road). We are working on a draft drop policy and hope to release a public draft by the end of the year. With the state covering our make-ready overages, the project remains on budget.
Schedule
There is no change in the schedule compared to the previous report.
We have received estimated completion dates from National Grid and Verizon for completing the utility make-ready work. All work should be completed by the end of October, 2020. Based on these dates, we are hoping to begin offering service in parts of town by the end of March, 2021. Service to other parts of town should roll out during 2021 and we hope to have service to all areas of town by December, 2021. Currently, the utility make-ready work remains the gating item in the schedule.
Utility make-ready work
We have received work descriptions and make-ready invoices for all of our utility applications (except one supplemental Verizon-only application for 20 additional Verizon poles on South River Road). Based on the total cost of the invoices, we have applied to EOHED for an advance from the last-mile contingency fund of $438,000.
We are monitoring the progress of the Mass DoT traffic calming project in the town center. Based on the current schedules, we believe the utility work for both the traffic calming project and the broadband project will be done concurrently during the summer of 2020. EOHED and WG+E are also aware of the situation and are working with National Grid to ensure that the work is properly coordinated to minimize taxpayer cost.
Budget
As was the case in a number of towns, the actual cost of the utility make-ready work for Charlemont will exceed the state’s estimated make-ready budget. Because of this, the town is eligible for additional state funding from the EOHED Last-Mile Contingency Fund to cover our make-ready “overage”. As noted above, we have applied for an initial advance of $438,000 based on the invoices from National Grid and Verizon. The town should also be eligible for additional money from the Last-Mile Contingency Fund beyond this advance when the network is complete.
Because the state has committed contingency funding to cover make-ready overages, the overall project remains essentially on budget. An expense tracking report is available here:
https://drive.google.com/open?id=1dh_kFVuKwnovJTOfEz86h4cxdb1348J0
Financing
Our current financing plan is to delay any “major” borrowing until FY 2021. We anticipate that the bulk of the network distribution construction will occur in FY 2021.
For the current fiscal year, we are projecting receiving two tranches of additional funding from EOHED: a $438,000 advance from the last-mile contingency fund and a $185,000 milestone payment from the original grant when we approve a construction contract for the distribution network. We are planning to put the distribution network construction out to bid in Q1 2020. With this funding, we should be able to cover all of the make-ready invoices due this fiscal year plus expenses associated with the town hall basement construction and exterior conduit and vault installation.
In Spring 2020, we may need to do short-term borrowing to complete some of the other make-ready projects, including the construction of network paths on Hawk Hill Road, Heath Stage Terrace and the west end of Tower Road, if these projects commence prior to June 30. The amount and timing of any short term borrowing will be determined in the spring.
A spreadsheet showing our current cash flow projections is available here:
https://drive.google.com/open?id=1GL2BrdMSb-S4zIi2OzHoUT8n-sZLnSye
Cash flow to cover any deficits shown in the projections within the current fiscal year will be covered through the town stabilization fund or other float in the town accounts.
Distribution Network
We are working on a number of tasks in preparation for putting our distribution network construction out to bid:
- Heath Stage Terrace
The homes on Heath Stage Terrace are served by underground (direct buried) utilities. We explored design options for both aerial and underground solutions. To attempt to save money, we put an underground solution out to bid in the fall, but rejected the bids received because they were not any cheaper than contracting for the work through WG+E.
In October, with the concurrence of the broadband committee, the select board approved building an underground solution for Heath Stage Terrace. We agreed that using a path that matches the existing underground was justified and reasonable given the incremental cost, estimated at roughly $15,000. We plan to contract for this work through WG+E in the spring.
- Hawk Hill Road / Deer Run Lane
A half-mile section of Hawk Hill Road currently has underground utilities. We received quotes from WG+E for three solutions, the cheapest of which was fully underground at $44,000. We put this work out for quotes through FRCOG along with Heath Stage Terrace to see if we could potentially save money, but did not receive any lower bids. We plan to contract for this work through WG+E in the spring.
- Tower Road (west)
To avoid an expensive non-public railroad crossing, we have designed a new installation of 8 town-owned utility poles along the west end of Tower Road to cross the railroad tracks and connect the existing utility poles on the east and west ends of Tower Road. The select board has approved these new utility poles. We have secured permission from the railroad for the public crossing. We plan to contract for this work through WG+E in the spring.
- Long Bridge RR Crossing
To avoid an expensive non-public railroad crossing, we are working with WG+E on the design of a public-way railroad crossing on Route 8A at the south end of Long Bridge. We have evaluated several designs in consultation with WG+E, National Grid, PanAm Railways and other consultants. We do not yet have a solution, but we are continuing to work to find an economical solution for this railroad crossing that will minimize the cost of operating and maintaining the network in the future.
- South River Road
To avoid an expensive non-public railroad crossing, we filed a supplemental utility pole application with Verizon for space on 20 Verizon-only poles on South River Road. The poles have been surveyed and the applications has been filed with Verizon. We are awaiting the make-ready estimate from Verizon. We are working with WG+E to make sure this supplemental make-ready work is done along with the rest of the make-ready work in Charlemont.
- West Hawley Road
There is one house on West Hawley Road where the utilities reach the house via a non-public-way railroad crossing. We are currently evaluating alternative solutions for this house, including a potential wireless extension of the distribution network.
- Town Hall Exterior
Danek Excavating has completed the installation of the conduit, vault and utility pole risers outside the town hall. The conduit extends from the vault into the basement. Danek Excavating will return in the spring when weather permits to finish some parts of the work: applying stone dust where the conduit crossed the town hall driveway, repairing the asphalt on the walk in front of the town hall and reseeding the lawn and regrading the area around the vault if necessary.
- Town Hall Interior
We awarded the interior construction work on the network equipment room in the town hall basement to OBear Construction. We expect them to do the work this winter.
- Neighboring town agreement with Rowe
No change in status.
We have reached verbal consensus with Rowe to provide access to cabling in Rowe to reach the upper end of Maxwell Road from Legate Hill Road via Tatro Road in Rowe. In exchange, Rowe is requesting access to cabling in Charlemont from the border on Zoar Road to the Charlemont town hall to be used by Rowe for redundant backhaul.
We have a verbal agreement on a draft agreement, which we will bring before the select board. We are awaiting finalization of an agreement with Heath before proceeding.
- Neighboring town agreement with Heath
We are working with Heath on an agreement to provide access to cabling in Heath to reach Warner Hill via a long route from South Heath Road in Charlemont through the Heath network to Warner Hill. This is the path followed by the existing electric utilities.
We are working with Heath on an agreement to provide access to cabling in Heath to reach Bassett Road from South Heath Road via South Road in Heath.
Heath has been in contact with WG+E and they have committed to drafting an agreement with us by the end of the year.
Network Drop Policy
The broadband committee has been working on a draft policy document describing the work and process for connecting to the network and subsidies the town will provide to encourage individuals to connect. We hope to release a draft for public comment by the end of the year.
The state announced that there will also be additional state funding provided to towns in the EOHED municipal network program to subsidize network drops. The state will offer towns additional funding of $500 per premises connected during network construction for up to 70% of the premises in each town. This could provide additional state funding of up to $240,000 for Charlemont, depending on our take rate.
Reconnect Grant
With the approval and support of the select board, we applied for a USDA Reconnect grant. We applied under a combined grant/loan program for a matched grant and loan of up to $1,000,000 each. This grant is a long shot, but it was free to apply (outside of a couple hundred dollars in legal expenses).
The USDA is behind in reviewing these grants, but we have been in contact with our local USDA representatives to monitor progress. A number of grants have recently been awarded under the previous phase of the program, indicating the USDA is working through the backlog.
Charlemont Connect website
We continue to communicate project status from our web site www.charlemontconnect.org, dedicated to the fiber network project. We are posting to this website regularly to communicate status and engage with residents. There is also a mailing list signup for email notifications.
Glossary
Aerial License Agreement. The master contracts between the town and the utilities (separate contracts for National Grid and Verizon) covering the terms for leasing space on the utility poles.
Customer Connections / Drops. Cabling from the nearest distribution network tap (MST) to a network interface box on the outside of the house or building, then inside to another small unit (ONT) which is connected to a wireless (or optionally non-wireless) router that provides internet service. A “cold drop” includes just the cabling to the outside of the house without any inside wiring.
Distribution Network. The main fiber optic lines running from the network equipment room in the basement of the town hall and along most of the roads in town. The distribution network terminates at “taps” (called MSTs) located on utility poles near each serviceable house or structure.
ISP / Internet Service Provider. A company that provides internet service on a network and performs functions like billing and customer support. The town will contract with a third-party internet service provider to provide service to residents using the town network.
Make-Ready Work. This is work to prepare a “path” for the distribution network to run throughout the town. Most of this work is done by the utilities (National Grid and Verizon) to make space on existing utility poles. In some cases, the town may perform make-ready work by installing new underground conduit (e.g. near the town hall or on Hawk Hill Road) or new utility poles (e.g. on the west end of Tower Road) to create a cost-effective path for the distribution network.
MLP / Municipal Lighting Plant. A legal entity created by the town to allow the town to supply internet service to residents. It is called a lighting plant because the applicable state laws were originally written to allow towns to create local electric utilities. The MLP functions much like a town department.
Utility Pole Lease. The town will lease 12 inches of space on most of the utility poles in town to allow us to run the fiber network throughout the town. We will pay an annual lease fee per pole.