When Easthampton voters cast their ballots in 2019, there was only one contested race for city office.
But it wasn’t any of those unopposed candidates for mayor, City Council or School Committee that received the most total votes in the election. Instead, it was a ballot question asking voters to establish “a city-owned company that can provide utilities services including telecommunications systems and internet to households.” Of the 4,195 residents who voted in the election, 79% agreed they wanted Easthampton to create a municipally owned utility, which officials had begun exploring to bring city-owned broadband internet to town.
But after some five years of work toward establishing a municipal network of faster fiber optic cables to deliver broadband — including the passage of the ballot initiative, a detailed feasibility study and $150,742 in taxpayer money spent on design work for the project — Easthampton’s path toward a public utility came to an abrupt end earlier this year.
City residents are still getting fiber internet. But instead of a publicly owned utility rendering that service, a private equity-owned company called GoNetSpeed will be providing it. On May 25, the mayor’s office and GoNetSpeed announced a “partnership” to install fiber optic cables, which use light signals to transfer information more quickly and reliably than other platforms, across the city. GoNetSpeed said that it was fully funding the $3.6 million it would take to build the network citywide and may begin service as early as the start of 2024.
For some, the arrival of GoNetSpeed was a long-awaited development in a city where telecom giant Charter Communications is the only internet service provider. An advisory committee concluded in 2021 that there was “general dissatisfaction” in Easthampton with the quality and price of current internet services — issues that GoNetSpeed has promised to improve with its fiber optic cables and by providing competition to Charter.
“Through this partnership, we are able to ensure that internet connectivity is broadly available in a time when it is a necessity for our daily lives,” Easthampton Mayor Nicole LaChapelle said in that May announcement.
But for others who dreamed that a city-owned broadband utility would serve residents better than a for-profit company, the mayor’s decision to work with GoNetSpeed represents a “missed opportunity.” Several of those involved in the campaign for a public internet network in Easthampton expressed disappointment in the development, pointing to cheap and reliable municipal broadband services in neighboring communities like Westfield, South Hadley and Leverett as examples of what the city could have had.
Paul St. Pierre chaired the Easthampton Telecommunications Advisory Committee, which between 2019 and 2021 studied broadband infrastructure, market conditions in the region and what the city could do to ensure affordable and effective internet service for all. The group’s report recommended the city move forward with municipal broadband, concluding Easthampton could do so without raising property taxes.
As many as 7% of Americans don’t have adequate broadband service, according to federal estimates. In Massachusetts, census data show that 10% of the state doesn’t have access to a broadband subscription, a “digital divide” that exists in both rural and urban communities and separates those who have access to affordable, high-speed internet and those who don’t. In the Connecticut River Valley, the divide is even more pronounced; data that the state-run Massachusetts Broadband Institute recently presented at a listening session show that 28% of the 281,000 households in the region have no broadband internet subscriptions and 52% of municipalities have “little to no competition in the broadband market.”
In Easthampton, the Telecommunications Advisory Committee looked toward public ownership of city broadband as a way to address those inequities in their own community.
“It was about creating a municipal utility and kind of viewing internet service as a utility and no longer a luxury,” St. Pierre told The Shoestring. “Seeing that the private company is coming in, in a way it kind of validates what we were saying: that this is an economically feasible thing that we could have done.”
Nearly eight years ago, ambitious plans were moving forward to bring publicly owned broadband to some of the least-connected municipalities of western Massachusetts. But then, the project came to a screeching halt.
At the time, 40 rural towns were preparing to build out their own fiber optic network as a regionally owned cooperative, WiredWest. Then the Massachusetts Broadband Institute, under newly elected Republican Gov. Charlie Baker, suddenly pulled support from the project in favor of partnering with for-profit companies. The initiative “crashed and burned,” Berkshire Eagle investigative reporter Larry Parnass wrote in 2017, over MBI’s concerns with WiredWest’s business model — worries that the cooperative’s backers said were overstated. WiredWest still exists, but now provides services to only six member towns.
The demise of WiredWest’s initial plans, however, was far from the end of public broadband initiatives in the region, some of which have flourished in the time since. For example, western Massachusetts communities with established municipal electric utilities — known as municipal light plants — have built out their own fiber networks in recent years and worked with other municipalities to help them do the same.
Leading that charge in Hampden County is Westfield Gas & Electric’s municipal internet service Whip City Fiber, which serves some 20 municipalities across the region, from West Springfield to Wendell and including the remaining WiredWest towns.
In Hampshire County, the South Hadley Electric Light Department, or SHELD, has steadily built out its fiber network to 95% of the town and has helped both Shutesbury and Leverett build their own networks. SHELD General Manager Sean Fitzgerald told The Shoestring that although a municipal utility has to make a certain degree of revenue, it doesn’t have to operate with profits in mind like an investor-backed company. That means that public utilities’ rates tend to be lower and more stable, and their customer support more responsive, he said.
“There’s really kind of a renaissance going on with internet service providers in the United States,” Fitzgerald said. “In our region, what you’re seeing is a lot of towns, dozens of them, voting to become their own municipal light plant … The reason that’s happening is that the larger corporations aren’t investing in fiber optics in western Massachusetts.”
That is particularly true in rural communities where smaller populations are spread out across a wider geographic area, making private companies hesitant to invest because of the high costs of installation and lower customer base to recoup those costs.
Some rural communities elsewhere in New England have decided to band together to build broadband infrastructure. In Vermont, for example, 213 municipalities — representing 76% of the state’s population — had joined a “communications union district” that can issue revenue bonds to finance broadband networks as of November 2022. Maine has also witnessed the creation of two regional broadband utility districts, and last year state lawmakers there passed a bill that supports municipal broadband infrastructure.
Other municipalities in Massachusetts have considered a hybrid approach through public-private partnerships.
Last month, Northampton released a market and feasibility study of municipal broadband that it hired the firm Design Nine to conduct. (In 2021, Northampton residents voted 91.3% in favor of creating a municipal light plant.) That report suggested the city could play a key role in providing broadband infrastructure by, for example, building the fiber network and leasing it out or partnering with a private internet service provider by financing the buildout in return for guarantees the company would service all neighborhoods. The report recommended that the city not become its own internet service provider.
Elsewhere in the state, a group of 26 towns — mostly in eastern Massachusetts but including East Longmeadow, Hampden and Wilbraham — formed the Massachusetts Broadband Coalition, which has been exploring similar public-private partnerships, according to reporting from the community development-focused national nonprofit Institute for Local Self-Reliance.
Sean Gonsalves, the associate director for communications at the Institute for Local Self-Reliance’s Community Broadband Networks Initiative, told The Shoestring that efforts to build public internet infrastructure picked up momentum when the pandemic began in 2020. Many people started attending school and working from home, and some communities realized that they should be treating the internet as a fundamental municipal service, he said.
“You’re looking at it as civil infrastructure much like roads and water systems, and when a municipality bonds to build these networks … you don’t need to make a lot of money and you have a longer time to pay off those bonds,” Gonsalves said.
As part of the $1 trillion infrastructure bill that Congress passed in 2021, the federal government is now pouring $42 billion into high-speed internet infrastructure, including $147 million in Massachusetts. Later this year, the Massachusetts Broadband Institute is expected to release a plan for spending that money, which must be used first to bring broadband to entirely unserved, largely rural communities. Only after that are states allowed to spend money on communities designated as “underserved” based on the availability of higher-speed internet — money that Gonsalves said could be used to connect, for example, low-income apartment buildings.
The Massachusetts Broadband Institute has been on an “Internet for All” listening tour of the state as it puts together that plan for spending those dollars. It remains to be seen whether the bulk of those Broadband Equity, Access, and Deployment funds, as they’re known, will go to fostering publicly owned operations or private companies in Massachusetts.
Given the parameters of the program, though, BEAD money is less likely to arrive in municipalities like Easthampton and Northampton, leaving those communities looking for other ways to bring fiber to homes.
In a municipal broadband community meeting last month introducing the Northampton report, Mayor Gina-Louise Sciarra told those gathered that federal and state lawmakers have said Northampton likely would not qualify for BEAD funds. Design Nine consultant Andrew Cohill said that those challenges Northampton is facing mirror those of many other municipalities.
“It’s really unfortunate the way, particularly the federal funding, has been exclusively for unserved and in some cases underserved areas,” Cohill said. “There’s a lot of municipalities in the country that do not have adequate high-speed broadband and that is also affordable. And so the financing is a big challenge.”
When the COVID-19 pandemic hit, schools and businesses shuttered their doors. For Easthampton resident Jason Miranda, that meant he and his family had two parents working and two children learning at home, straining their internet connection to the brink. Others had it even worse, he said.
“People who didn’t have access to a reliable internet connection were having to go sit in their cars and sit in the parking lot of the schools to do their homework,” said Miranda, who also sat on the Easthampton Telecommunications Advisory Committee.
Miranda said that he tends to favor public ownership and control of vital services, and that the committee found that many other city residents were excited about that prospect when it came to municipal broadband. The project could have started in one neighborhood, using the revenues from that to expand the network out to cover the whole city.
As Easthampton began down the path of exploring municipal broadband, the city initially contracted with SHELD, South Hadley’s public utility, to build out its broadband network. But after SHELD finished the first phase of that work conducting a utility-pole survey and drawing up a complete city-wide design for the project, LaChapelle decided to move in a different direction.
This summer, shortly after GoNetSpeed and the mayor’s office announced that the company was coming to town, the City Council signed off on paying SHELD $150,742 out of the city’s reserve account for the work SHELD did instead of going to court over the breaking of the contract.
GoNetSpeed is a conglomeration of small, previously independent telephone companies scattered across the country, including in Maine, Massachusetts, New Hampshire and Vermont. Originally known as OTELCO, the company was publicly traded until 2021, when the private equity firm Oak Hill Capital bought the company and took it private.
In municipalities big and small alike, GoNetSpeed is pouring millions of dollars into fiber investments in Connecticut, Maine, New York and western Massachusetts, where Amherst was the first town GoNetSpeed connected to its network in July.
“GoNetspeed is working to ensure that more communities throughout Massachusetts will soon have access to a high-speed 100% fiber internet infrastructure,” the company’s press release said at the time. “In the coming months, more communities throughout the state will join Amherst in having access to GoNetspeed’s fiber internet.”
Jamie Hoare, GoNetspeed’s chief legal counsel, told The Shoestring that while he believes there are places where a “municipal solution” is appropriate to building fiber networks, private companies can save taxpayers money because cities and towns won’t have to bond to build that infrastructure.
“I think an easier way to approach the issue, where available, is to allow private providers to build their networks and to remove the barriers that exist for that,” he said.
To that end, the company is backing legislation that would speed up the process for granting applicants like GoNetSpeed and others access to utility poles. That process is currently overseen by the companies that own the pole network, and Hoare said that makes it costly and sluggish for possible competitors to obtain the efficient access they’re entitled to on those poles. Hoare said the “intransigence” of those companies is standing in GoNetSpeed’s way, not competition from municipally run networks.
(In other states, telecom giants like AT&T and Comcast have lobbied for bills that restrict or outright ban municipalities from establishing public broadband networks. The organization BroadbandNow has identified 16 states that still have those kinds of laws on the books.)
GoNetSpeed has said that in a region where a large majority of residents only have one internet service provider to choose from, the company’s arrival in Easthampton will create competition and drive down prices.
“The profit motive is what drives us to keep our prices down to attract as many customers as we can because we understand that customers do have choices in this area and, yes, what we provide is the best service,” he said.
LaChapelle said that it was ultimately her who, after crunching numbers and looking at timelines, decided to welcome GoNetSpeed instead of possibly taking on debt to support municipal internet. She said that the city has a lot of projects in the works and that she had to choose what to spend public dollars on. GoNetSpeed said it would connect the entire city to its network, and that it wouldn’t cost the city anything, so LaChapelle signed an agreement with the company.
“I really wanted to see broadband across the city and I didn’t want to have to do it in chunks,” she said. “And I didn’t want to have to commit the city to having to bond while this [municipal light plant] was getting up and running.”
Some of those who worked on bringing municipal broadband to Easthampton, however, have questioned whether a private company will benefit customers in the long term or keep its promises to build out the entire city.
“On the one hand it’s good that we have competition now, we have more than one offering,” Miranda said. “But that said, it remains to be seen the quality of the service and what kind of price they’re going to come in at and what those prices are going to look like year over year. I certainly don’t think it’s as competitive as a municipal service could have been. Or as responsible.”
In its “joint working initiative agreement” with Easthampton, which The Shoestring obtained through a public records request, GoNetSpeed agreed to “building and deploying a fiber network city-wide to homes and businesses, without installation fees for residential customers, as soon as possible.” That, however, is “subject to supply chain and/or state agency and other third parties.”
“Sure, what a corporation puts into a letter, it’s not scripture,” LaChapelle conceded. “But they’ve made good on their promises so far.”
As part of the agreement, the company will also support the city’s efforts to educate residents about the federal Affordable Connectivity Program, which provides up to a $30 monthly discount on internet service for households at or below 200% of federal poverty guidelines. (On Tuesday, LaChapelle’s office also announced that the Massachusetts Broadband Institute had selected Easthampton to be in the first cohort of communities it will help develop a “digital equity plan” that will “outline a path for closing the digital divide.” The city and its consultants will hold a listening session of their own on Oct. 25 at 6 p.m. at Mountain View School.)
Gonsalves, the broadband expert at the Institute for Local Self-Reliance, said that he isn’t familiar with the specifics of Easthampton’s situation. But speaking generally, he said that private-public partnerships work best when communities are investing capital into the project too, allowing them a real seat at the table. When a municipality just plays “a support role,” he said it is very difficult, if not impossible, to have any say.
“Generally speaking, the more skin in the game that a community has, the more say they have in terms of the outcome: timeline, affordability, reliability standards,” he said. “Those are the kinds of things that can be part of a private-public partnership and can be negotiated.”
Others have expressed concern about the possibility that GoNetSpeed gets gobbled up by a bigger competitor at some point in the future.
Private equity firms invest large pools of money — from wealthy people or endowments, for example. Often, a strategy they use to make handsome returns on those investments is by buying companies, restructuring them and selling them at a higher price.
Before Oak Hill Capital bought OTELCO in 2021, the company was publicly traded and, for that reason, had to make regular disclosures to the U.S. Securities and Exchange Commission. In one filing OTELCO made to the SEC in 2019, the company pointed to Oak Hill Capital’s role in gobbling up the competition in New England.
“Consolidation in the telecom sector over the past few years has significantly shrunk the universe of Otelco’s competitors, especially in the Northeast, with the completed acquisitions of Firstlight, Oxford Networks and Sovernet by Oak Hill Capital,” the report said.
The report said that one of OTELCO’s “operational objectives” was the expansion of its fiber network, increasing revenue per customer and making the company “more attractive for targeted acquisition.”
That’s exactly what happened in 2021, when Oak Hill Capital bought the company and took it private. Now, some have expressed worries that one of the telecom giants will purchase GoNetSpeed after it builds out more of its fiber networks.
“There’s no control in the long term,” Miranda said. “It does concern me, especially since private equity is involved and when they can’t get their money back they break it up and sell the parts or it just goes away.”
Hoare, the GoNetSpeed lawyer, said that it doesn’t seem like Oak Hill Capital has plans to seek a buyer and that the company plans to stay in the region.
“It’s difficult to think about what does the future hold, but we’re not looking to join up with other companies in the area,” he said.
A thin blanket of fog lay draped across Easthampton last Thursday morning as workers in reflective, neon coats moved down South Street in bucket trucks. At one end of the street sat a large spool of thick fiber-optic cables, spinning slowly as workers let out the line and hung it from one utility pole to the next.
When St. Pierre learned that Easthampton had jettisoned plans for municipal fiber and that GoNetSpeed was beginning work in the city, he said it was bittersweet. The city probably could have done it better, he said, but GoNetSpeed’s arrival will mean more competition.
“I hope they’re able to deliver a quality service that would serve the people of Easthampton effectively,” St. Pierre said. And while he’s not familiar with GoNetSpeed, he said the bar is low for them. “It would be hard for them to do worse than Charter. They’d have to really try.”
Others involved with the Easthampton Telecommunications Advisory Committee described the development as a disappointment. Miranda said that when the committee handed in their report, he never heard about it again from city officials.
“We never got a follow-up, we never got invited to the City Council meeting when they discussed it,” Miranda said. It was the first time he got involved in a city committee, and he said the lack of communication has made him leery about participating in something like that again. “I think our job was done, but at the same time, it’s sort of like all the work we had done just went into a black hole.”
LaChapelle said that she isn’t under any illusions that GoNetSpeed is “the friendliest corporation in the world;” they’re not, she said. The company didn’t need Easthampton’s permission to begin the work of building its own network in town, though LaChapelle said GoNetSpeed likely wouldn’t have entered the market — which Hoare, the company’s lawyer, described as “attractive” — if a municipal utility were there to compete for customers.
“Is it disappointing that we won’t have our own broadband? Yes,” LaChapelle said. “But also, going forward and staying with a private company, I feel like the city in 10 years, in 20 years, will be more on top of technology with GoNetSpeet than with [a municipal light plant] that has to continually upgrade and improve lines in the city.”
St. Pierre said that he sympathizes with City Hall, given the administration’s long list of projects now in the works to improve quality of life in the city.
“Unfortunately, the municipality, for whichever reason, was not able to move forward and the private company saw the opportunity and jumped on it,” he said. “Even though we could have done it on a municipal level if we had moved a little faster.”
City Councilor Tom Peake was perhaps the biggest proponent of municipal broadband, moving the project through two City Council votes in order to get the question on the ballot asking residents if they wanted to create a municipal light plant. Peake declined an on-the-record interview about LaChapelle’s decision. In a statement, he said that it came down to the mayor and her team deciding to head in a different direction.
“I was opposed to the decision, but I understand why she made it,” Peake said. “This network will get built out, and it won’t cost the city anything. We also won’t own it or gain any of the benefits of owning it, which to me is a huge missed opportunity. On the other hand, it will allegedly be built much faster than the timeline we had for financing and building a municipal network.”
“Tough call either way,” he added.
Dusty Christensen is an independent investigative reporter based in western Massachusetts. He can be reached at firstname.lastname@example.org. Follow him on Twitter: @dustyc123.
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