9.g Ray report on Midco proposalCTC Cost Proposal:
DEED Grant Requested: $ 5,000,000
Scandia Funded: $ 5,729,005
CTC Funded: $ 2,648777
TOTAL $13,377,782
How does Scandia raise $5,729,005?
General Obligation Bond at 7% Interest rate and a 10 year term?
Total cost of principal plus interest is $7,900,000.
City taxes raised $4,425 per household or $442.50 per year for 10 years. (Varies according to
value of property). Based on 1,785 households
This includes all of Midco 782 customers and Cedarcliff WISP 9 customers that neither want nor
need CTC internet service.
Midco Cost Proposal
2020 Deed Grant Request
Scandia Funded
Midco Funded
Ito] IF_11
Current subscribers
DEED grant wired
DEED grant wireless
TOTAL
$ 450,000
$ 130,000
350,00
$ 930,000
782 (44% of 1785 households)
192
176
1,150 (65% of 1785 households)
9 households on the Cedarcliff WISP.
626 total households left with Frontier service or no service.
2021 DEED grant 150 subscribers
Scandia Funded $130,000
Wired service with Midco for the remaining 476 households x $4,750 = $2,380,000
(DEED grant calculated at $4,323 per subscriber)
Midco would covers 1/2 leaving $1,190,000.
General Obligation Bond at 7% interest rate and a 10 year term?
Total cost plus principal is $1,329,330
City raises taxes by $744 per household or $74 per year for 10 years. (Varies according to value
of property). Based on 1785 households.
CTC's $5,000,000 DEED grant request for Scandia
$20,000,000 total for the whole state of Minnesota.
120 communities eligible.
Sweet spot for a DEED grants this year is between $350,000 to 600,000.
$5,000,000 is 25% of state's total.
It would take approximately 8 years at $600,000 a year to reach a $5,000,000 DEED grant.
Another $20,000,000 for 2021.
Legislature could change criteria for DEED grant loan application to unserved and not include
underserved for 2021. No funding as of now past 2021.
CAF III Grant (FFQ
Reverse auction — lowest bidder wins. Midco beat CTC every time due to their lower cost of
installation.
Subordinate Service District
Only applies to Midco. CTC will only bid the whole of Scandia and not the non Midco area. Did
not pass the legislature last session.