Title: Broadband Authority Program and Project Update
1Broadband Authority Program and Project Update
2Mission and Lending Criteria
Missionattract investment to underserved
communities and encourage competition and more
affordable broadband services across the state in
all markets Tool for the aboveloans made to
broadband providers and grants combined with
loans in limited areas (using bond sale proceeds
and NO general fund dollars for this
purpose) Lending Criteriaadequate cash flow,
solid business plan, sufficient borrower equity,
guarantees and other security requirements as
necessary
3Typical Loan Terms Conditions
TermsSenior lender with term loans ranging from
5 to 7 years and 12 to 24 month interest-only
draw periods if necessary Interest Rate8
percent fixed (also have limited availability of
a variable rate currently pegged at less than 5
percent) Equity100 percent project financing
available but net equity on company balance sheet
should equal 20 percent (at a minimum) of loan
request. GuaranteesTypically required but
usually NOT collateralized. Operating deficit
reserves and other alternatives to personal
guarantees utilized on occasion
4MBDA is achieving its vision and making an impact
17.7 M Approved Projects
10M in Applications
10M Near-Term Applications
6-10M in likely loan applications Fiber and
wireless projects in underserved areas 2nd RFP
for Digital Divide Investment Program
Area Servedin dark
ISP Wireless PCS Broadband M-33 Access Appia
Communications ACD.net ACD.net WEST SpeedNet Michi
gan Lightwave Merit Networks UPLink Services Inc.
(seed) LDMI Lighthouse Broadband
UPLink Services, Inc. OneWorld AriaLink Endless
Journey
Additional DDIP Applications VoEx Lucre.Net Emmet
Wireless Grid 4 T2 Communications NBD
Communications First Step Michwave QIC
Borrower
5ISP Wireless
- Project
- 341,836 loan for the expansion of fixed wireless
broadband service in seven low-to-moderate income
communities - Purchase of tower antenna and customer premise
equipment - Status
- ISP Wireless is expanding customer base
- Internet Service Provider (ISP) business since
1995 - Stable business and revenues
6PCS Broadband
- Project
- 510,000 loan for the expansion of fixed wireless
broadband service in areas where small-to-medium
enterprises (SMEs) are underserved - Purchase of tower antenna, routers and customer
premise equipment - Status
- Premise cabling company since 1992 and enterprise
phone systems sales since 2000
7M-33 Access
- Project
- Expanding contract service to community college
and school districts - Refinancing of existing debt and purchase of
equipment (towers, antennae, customer premise
equipment) - 1.3 million loan
- Status
- Largest wireless broadband network grid of its
kind in the US - New contract saving schools nearly 1 million and
provide higher speed services
Note Illustrative only wireless coverage does
not blanket entire counties
8ACD.net
- Project
- Facilities-based carrier expands DSL service to
new markets and within existing areas - Re-financing of existing debt
- New financing for expansion into new markets, new
fiber routes and new equipment - 1.2 million loan
- Status
- Expansions in mid-Michigan complete
- SBC mirroring activity
9ACD.net WEST
- Project
- Acquisition of Quantum Connections assets and
expansion of broadband service - 1,681,139 loan
- Project will provide broadband service for
business and residential customers - Status
- Nearing completion of acquisition and transition
10Appia Communications
- Project
- 758,000 loan to Traverse City-based INSORS, Inc.
(dba Appia Communications) - Expansion and upgrades of network operations
centers to expand service and provide redundancy - Enhanced converged voice and data network
services for small and medium-sized enterprises - Status
- Currently offers service in Kalamazoo, Detroit,
Traverse City, Chicago and Indianapolis - Loan expanding footprint into Lansing and Grand
Rapids
11SpeedNet
- Project
- 1.5 million to finance the purchase of
non-line-of-sight tower equipment and customer
premise equipment and expansion in Tri-City area
(Saginaw, Midland, Bay City) - Status
- SpeedNet LLC, with headquarters in Saginaw
- Uses licensed 2.1 GHz, 2.5 GHz and 2.6 GHz MMDS
spectrum to provide fixed wireless broadband
service - Currently serves the Alpena, Saginaw and Mount
Pleasant areas
12Michigan Lightwave
- Project
- Dark fiber network in Macomb County
- Michigan Lightwave partnered with Macomb ISD and
county government on network - 826,327 loan for completion and purchase of dark
fiber network - New network will provide high-capacity, low-cost
circuits for large enterprises - Status
- Michigan Lightwave, LLC
- Operates successful dark fiber network in
Kalamazoo County
Project serves 25 new communities in Macomb
County and extends into St. Clair and Oakland
Counties
13Merit Networks
- Project
- 4.1 million loan approved
- Acquisition of fiber IRUs and construction of
laterals to improve their backbone network - Borrower
- Provider of high-speed data services to numerous
universities and other public institutions
throughout the State of Michigan - Currently determining whether tax exempt
financing possible
14LDMI
- Project
- Softswitch and broadband gateways
- 5 million loan to build out IP network
- Integrated voice and data services to
Southeastern Lower Michigan - Expand facilities-based infrastructure
- Borrower
- Southfield-based Competitive Local Exchange
Carrier (CLEC) - 300 Plus Michigan employees
15UP Link
- Project
- 815,000 loan requested
- Purchase of tower antennae, customer premise
equipment and construction of wireless tower - 50,000 Seed Loan recipient
- Underserved Upper Peninsula market
- MBDA Board consideration in March
- Borrower
- UpLink Services, Inc.
- Purchased earlier this year by several Marquette
investors with strong technology and finance
background
16Lighthouse Broadband
- Project
- 500,000 loan for capital build-out costs to
deploy Broadband Over Powerline (BPL) Initiative - CMS Partnership
- Approved in February
- Borrower
- Shpigler Group (dba Lighthouse Broadband)
- Management consulting firm for communications and
technology - Operating two other BPL pilots across the country
- Selected by Consumers Energy to pilot BPL
initiative in Grand Ledge and likely St. Johns.
17MBDA current portfolio of approved projects
Total number of counties at least partially
impacted by approved loans 45 Total number of
cities impacted by approved loans once networks
are built and lit 150 Total number of loan
applications received in last 12 months
25 Total amount of approved projects
17.7M Total amount in project pipeline
(approved, received and expected 05
applications) 35 to 40M
18For More Information www.broadbandauthority.org