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Lake Connections receives 4 bids

Four entities submitted bids to purchase Lake Connections from the county Nov. 2. All four will have the opportunity to submit a "best and final offer by Nov. 29. (News-Chronicle file photo)

The Lake County Board of Commissioners learned four entities submitted bids for Lake Connections, the county's municipal broadband project.

The initial bidding period ended Nov. 2 with Lake Partners, Hanson Communications, Mediacom Communications Corp. and Cooperative Light and Power (CLP) in Two Harbors submitting bids, along with a $100,000 deposit, for the network. They will have the opportunity to submit a "best and final offer," according to the terms of the sale set by the county and the U.S. Department of Agriculture's Rural Utilities Service (RUS).

In 2010, the board received a $56 million loan and $10 million grant from RUS to construct the network. Over three years, more than 1,200 miles of a fiber network was built in Lake County and parts of eastern St. Louis County.

Most of the network was completed in June 2015. The focus shifted to connecting eligible customers to the network with the county pledging $15 million of its own money to fund "drops" — home connections — that also included a $3.5 million grant from the Federal Communications Commission.

In June 2017, the county entered into a deferral agreement with RUS for principal and interest on the condition the county sell the network to a private company or entity. Two months later, the county executed a memorandum of understanding with RUS in which RUS agreed to accept to the sale price of Lake Connections in full satisfaction of the county's debt for construction of the network.

The county board is reviewing the bids, according to County Administrator Matt Huddleston, and specific bid information was not provided. Since there were fewer than five bids, Pinpoint Holdings Inc. in Cambridge, Neb., will also have a chance to make a final bid for the network.

In late July, Pinpoint offered $3.5 million for the network in an initial bid that set the baseline price for the network.

Two bidders, Mediacom and CLP, have conflicted with the network in the past.

In 2011, Mediacom filed a complaint with the Office of the Inspector General within the USDA objecting to the Lake County's plan to use a $56 million loan from RUS to build the fiber optic network to every home in the county on the electrical grid.

CLP dealt with the network during construction over the network's use of the utility cooperative's poles in Two Harbors.

A third bidder, Willmar, Minn.-based Hanson Communications, owns a number of telephone networks and cable television systems in Minnesota, South Dakota, Nebraska and Ohio.

The fourth bidder, Lake Partners, is a partnership of several telecommunications companies, including Crosslake Communications and Tri-Co Technologies, in the Brainerd Lakes area.

The tentative deadline for submission of the best and final offers is Nov. 29. The County Board is scheduled to make a selection of the successful bid Dec. 11.

Jamey Malcomb

Jamey Malcomb has been a reporter for the Pine Journal since October 2018. He previously worked as a reporter for the Lake County News-Chronicle from 2015-2018. Malcomb is a native of North Carolina and holds a bachelor's degree in English and history from the George Washington University and a master's degree in education from George Mason University in Fairfax, Va. Malcomb moved to Minnesota in July 2012 and worked as a sports clerk and news assistant at the Duluth News Tribune. 

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