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City Council Agenda City of Kingston Information Report to Council Report Number 20-243 To: Mayor and Members of Council From: Lanie Hurdle, Chief Administrative Officer Resource Staff: Craig Desjardins, Director, Strategy, Innovation & Partnerships Date of Meeting: November 17, 2020 Subject: Rural Broadband Update Council Strategic Plan Alignment: Theme: Council requests Goal: 4.1 Support new and existing businesses Executive Summary: The purpose of this report is to provide Council with a briefing on broadband internet including details of a Kingston Broadband Gap Analysis, potential solutions under development and grant funding opportunities as requested in a motion approved at the October 6, 2020 meeting of Council as follows: Whereas broadband Internet connectivity is a critical infrastructure for all residents to access public safety, social services, government, transportation, arts, culture and recreation, healthcare, and education where rural and low-income urban areas in Kingston are disadvantaged with limited access, expensive and underperforming internet services; and Whereas the COVID-19 pandemic has demonstrated an increased need for broadband internet connectivity due to remote working, remote schooling and shifts to e-commerce and support of the growing need for virtual health care opportunities; and Whereas access to reliable and affordable Internet connectivity is a necessity to find a job, start a new business, run a home-based business, communicate with suppliers and the global marketplace of customers which aligns with economic development business support objectives for the community; and Information Report to Council Report Number 20-243 November 17, 2020 Page 2 of 8 Whereas incumbent Telecom and Internet Service Providers have focused service provision on population dense, higher income urban residential neighbourhoods which results in many rural residents and low-income urban residents being underserved or unserved in Kingston; and Whereas Utilities Kingston’s Fibre Network business has shown leadership and creative solutions locally and has built over 1,000 kilometres of fibre broadband infrastructure that has created more market competition and reduced market prices while profitably providing Internet services directly to public sector and commercial enterprises for the past 20-years, Therefore Be It Resolved that Kingston City Council request staff to review the existing Kingston Broadband Gap Analysis Study and provide a report before the end of Q4 2020 with details of the scope of the broadband internet service gap in Kingston, options to provide internet fibre to the premises (FTTP) and financial analysis including access to funding programs from upper levels of government. The Kingston Broadband Gap Analysis Report completed in 2020 identified a number of key learnings that will be incorporated into the development of business plans and funding applications to provide rural Kingston with broadband service. The analysis was based on an extensive survey of rural residents in the fall of 2019 regarding the accessibility, price and performance of their internet connectivity, combined with similar survey data provided by the Canadian Internet Registration Authority (CIRA) for Kingston. This internet data was overlayed with econometric data from various sources to complete an economic impact analysis. Finally, the Gap Analysis included a cost estimate to provide universal fibre-to-the-premises (FTTP) internet connectivity to all rural residents and small businesses provided by Utilities Kingston. In summary, the Gap Analysis report includes the definition of broadband, an evaluation of internet service levels currently available (and their performance and cost), an order of magnitude cost estimate to provide broadband to unserved and underserved rural Kingston, a cost-benefit analysis of such a project and finally an estimate of the economic benefit to society of providing high quality internet to this community. While the report findings are less than 8 months old, much of the commentary and conclusions regarding the benefits of broadband in rural Kingston are now considered an under-estimation due to the dramatic impact of the COVID-19 pandemic on remote work, remote education, remote healthcare and e-commerce. With many of the changes to economic and social behaviour (i.e. remote work and e-commerce) likely to become permanent parts of our new normal, the case for need of broadband has only grown. Recommendation: This report is for information purposes only. Information Report to Council Report Number 20-243 November 17, 2020 Page 3 of 8 Authorizing Signatures: Craig Desjardins, Director, Office of Strategy, Innovation & Partnerships Lanie Hurdle, Chief Administrative Officer Consultation with the following Members of the Corporate Management Team: Paige Agnew, Commissioner, Community Services Not required Peter Huigenbos, Commissioner, Business, Environment & Projects Not required Brad Joyce, Commissioner, Corporate Services Not required Jim Keech, President & CEO, Utilities Kingston Desirée Kennedy, Chief Financial Officer & City Treasurer Not required Sheila Kidd, Commissioner, Transportation & Public Works Not required Information Report to Council Report Number 20-243 November 17, 2020 Page 4 of 8 Options/Discussion: In 2019, the Office of the CAO commissioned Utilities Kingston (UK) to complete a Broadband Gap Analysis of Kingston. UK in turn engaged Limestone Analytics (a Kingston-based consulting firm with ties to Queen’s University) to carry out the economic analysis. Limestone is recognized for its academically rigorous and practical solutions for identifying, designing, financing, monitoring and evaluating programs and policies in a range of sectors. A project team consisting of the City, Queen’s University, UK and a number of other ad hoc members was formed to: 1. Estimate the economic value of access to broadband internet services to residents and businesses in Kingston. 2. Geospatially identify gaps in access to broadband internet service throughout the City. 3. Estimate the cost of providing broadband to unserved areas and the cost-benefit to that project Key findings from the Kingston Broadband Gap Analysis Final Report (Exhibit A) include: • Broadband can not be defined as good and bad internet service based on download and upload speeds. Rather, broadband internet should be seen as a spectrum of quality along which different network systems can be categorized from poor to best. • Fibre to the Premises (FTTP) is the best broadband architecture available, and the only architecture capable of providing service that will meet society’s current and future needs. • On average, Kingston’s rural households pay more money for lower-quality internet service. The ‘digital divide’ separating Kingston’s rural and urban areas appears to have widened over the past five years. To give perspective of relative internet speeds across the City, residents can test their home internet speed at https://www.speedtest.net/ or a similar site. • The cost estimate for providing all of rural Kingston with the infrastructure required for Fibre to the Premises (FTTP) ranges from $23 to $87 million. • Under a conservative scenario, the economic value to society of providing access to broadband for rural residents of Kingston is estimated at $88 million, or $12,812 per household in rural Kingston. • Conservative estimates from a Cost-Benefit Analysis show that expanding FTTP infrastructure to cover all of rural Kingston will result in a net benefit to the overall economy over a 20-year period. Information Report to Council Report Number 20-243 November 17, 2020 Page 5 of 8 The report recognizes that, as society moves more completely into the digital age, reliance on and intensity of internet use will increase dramatically. Essential activities such as education, healthcare and government services are shifting to online delivery not to mention entertainment. Equitable access to high-quality broadband internet service is necessary to participate and benefit from these online activities. Eastern Ontario Regional Network (EORN) Broadband Activity Council will recall that from 2010 to 2015, EORN built a $175-million network that improved broadband access to about 90% of Eastern Ontario. The innovative public-private partnership was funded by the federal, provincial and municipal governments, and private sector service providers. Currently, EORN is spearheading a $213-million public-private partnership to improve cell service across the region. Both the federal and provincial governments have committed $71 million each. Most municipalities in eastern Ontario have also committed the municipal share of funding. Cell carriers will contribute the balance of funding to build new infrastructure. The goal is to provide 99% of the areas where there are homes, businesses and major roads with cell calling service. It will also further expand cell data coverage and capacity to support the use of typical smartphone apps and streaming video. In response to the COVID-19 pandemic that has highlighted the crisis in rural internet access and capacity by impacting businesses, student learning, healthcare and government services, EORN is now proposing an EORN Gig Project to deliver ultra-fast internet to homes and businesses in the region. A “Gig” refers to an internet speed of 1,000 Mbps or 1 Gbps (gigabit per second). It provides seamless, reliable connectivity needed for business, healthcare, education and other services. Gig speed is also needed
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