Frankfort, Ky. –KentuckyWired, the Commonwealth’s 3,400 mile middle mile fiber optic network project, has earned the Excellence in Development Finance Project Award, a top award from the Council of Development Finance Agencies (CDFA).
The KentuckyWired public-private partnership (P3) between the Commonwealth and Macquarie Capital received the top honor for its innovative financing package and forward thinking initiative. The award was presented this week at the CDFA’s National Development Finance Summit in Charleston, South Carolina.
“The KentuckyWired project is one of the most exciting and significant infrastructure projects in our state’s history,” said Gov. Steve Beshear. “This project is the largest P3 for public technology in the country, and we are being looked at as innovators for developing a robust fiber network throughout the state.”
“The non-partisan collaboration behind the scenes of this monumental broadband project should serve as a benchmark for leaders in business, public service and technology,” said Congressman Hal Rogers, Co-Founder and Co-Chair of the SOAR organization – Shaping Our Appalachian Region. “KentuckyWired or as I call it, the ‘Super I-Way,’ is proof that when we work as Kentuckians first, the whole Commonwealth benefits. I applaud the entire team for designing an affordable network plan that will catapult our State from the trenches of minimal Internet speeds into unlimited global connectivity.”
Construction of the network is underway in parts of eastern and central Kentucky. Construction in the 54-county SOAR region is expected to be completed in summer 2016. The entire middle-mile network is slated to be complete statewide by late 2018.
“The work of our award winners is cutting edge, innovative, and an example of best practices in our industry,” said CDFA President and CEO Toby Rittner.
KentuckyWired, projected to cost $324 million, is primarily financed by private sector investment of $270.9 million. The remaining funding is comprised of $30 million in bond funding that the General Assembly allocated in the 2014 session along with $23.5 million in federal funds.
KentuckyWired is the fiber optic backbone infrastructure to bring high-speed Internet service across the state, which currently ranks at or near the bottom of the country in broadband availability. There will be access points in every county with nearly 1,100 government facilities connected to the network. Because the network is open access, local Internet service providers can tap into the network to deliver last mile service to homes and businesses.
In August, the Kentucky Economic Development Finance Authority issued $232 million in 30-year tax exempt bonds to finance the project. To pay for the project, Kentucky will transition its current lease payments for Internet service to KentuckyWired. The Commonwealth will own the network in partnership with the Center for Rural Development for the Eastern Kentucky phase.
The deal received investment grade ratings of Baa2 from Moody’s Investors Service and BBB-plus from Fitch Ratings, which called the P3 a unique, first-of-its-kind approach to broadband connectivity on a statewide basis.