What Canadian Leaders Need to Know About Broadband Funding

Rural broadband networks help Canadians stay connected for remote work, distance learning, virtual socializing, telehealth, and more. When built or owned by a municipality, they can also generate revenue for the community! If you’re a municipal leader, you can calculate the potential annual revenue for your area by multiplying $100 (an average cost for high-speed broadband) by the number of homes in your area. Even at a conservative take rate of 60%, you could see significant revenue come from a community-owned network.

Broadband networks are a worthy investment — but they are an investment. As the old adage goes, “You have to spend money to make money,” and community broadband networks can cost a lot of money. Fortunately, Canada has programs in place to help cover some of those costs and get you one step closer to a revenue-generating network. Read on to learn more about the government grants and other funding options available to Canadian municipalities in 2021.

Canadian Broadband Funding from the Federal Government

While reliable broadband has long been a pressing need for rural communities, COVID-19 pushed it into the spotlight. With work, school, and much of life all moving online, the federal government recognizes that rural broadband access is a priority and has moved up previous timelines. Prime Minister Justin Trudeau has promised that the government is now on track to connect 98% of Canadians to high-speed internet by 2026 (compared to the previous benchmark of 95%), with the rest of Canadians getting access by 2030.

To help make that possible, the federal government launched the Universal Broadband Fund of $1.75 billion in November 2020. About $150 million of that is dedicated to rapid response projects, and your municipality can apply for up to $5 million for projects that would get your community connected by Fall 2021. The fund also favours the small ISPs and municipalities most likely to connect rural areas, with $875 million set aside for small and midsize network projects compared to $750 million for larger endeavours. Applications are currently open.

As you’re working on that application, keep an eye out for the CRTC Broadband Fund as well. The next application window opens in March 2021, and those funds can be used for both broadband networks and mobile wireless projects. Over the next five years, this fund will award $750 million to organizations connecting Canada.

As you review the requirements for these federal programs, you’ll find there is a great deal of upfront work you’ll need to do first. For example, feasibility studies are a critical step of planning, but they can be expensive to complete. In some provinces, gas taxes are being used to fund the planning phases in preparation for federal funding applications.

Additional Canadian Broadband Funding from Provincial and Municipal Governments and Other Sources

In addition to federal funding programs, make sure you look into funding options at the local level. There may be both provincial and municipal funds available to help build your network.

For example, Ontario’s provincial government launched ICON in July of 2020 to provide $150 million in rural broadband funds over four years. Funding was increased in November to $1 Billion. These funds can cover up to 25% of project costs.

In addition to government funds, there is also third-party financing available for funding your rural broadband network. Remember that community-owned networks can (and should) be revenue-generating. You’ll need a business plan that demonstrates your ability to develop a profitable solution, but with a strong application, you can fund up to 100% of your project value this way.

Canada Infrastructure Bank (CIB) is also willing to invest in community projects and even match your other third-party financing. The CIB plans to invest up to $2 billion in broadband infrastructure in the next ten years.

Your Guide to Canadian Broadband Funding

If you’re a Canadian leader looking to connect your rural community, there’s one thing you really need to know about funding: your applications matter. Whether you’re seeking government grants, third-party financing, or a mix of the two, you’ll need to be able to establish that you have an economically-feasible plan for connecting those who need it most. At ROCK Networks, we serve as your guide to help you do exactly that.

As you weigh various funding options, complete applications, explore third-party financing, select technology partners, and write business plans, we’re here to help. We’ve also organized a Rural Broadband Consortium to help you identify and connect with the partners you’ll need to plan and build your network.

Whether you’re exploring, planning, funding, or building a community-owned network, you don’t have to do it alone. Simply call 1.877.721.7070 or email sales@rocknetworks.com and schedule your free consultation with a rural broadband expert. We’re here for you!

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