The Online Journal & Network of ASPA’s
Section for Public Management Practice

In the delivery of public service functions, especially in the area of Information and Communication Technology (ICT), annals of literature have been written in scholarly journals worldwide on the best way to provide ICT services to the resident, commercial business owner and educational institutions to close the “digital divide” for access to such services.  Digital divide, more easily defined, is the ability or non-ability to have access to the Internet along with the appropriate ICT devices. In other words, the digital divide sets up the division of the “haves” and “have-nots” when it comes to access to the Internet.  Most people, nationwide, see ICT as a common tool to accomplish tasks daily.  As the proviso by the Federal Communication Agency outlines: “Like electricity a century ago, broadband is a foundation for economic growth, job creation, global competitiveness and a better way of life. It is enabling entire new industries and unlocking vast new possibilities for existing ones. It is changing how we educate children, deliver health care, manage energy, ensure public safety, engage government, and access, organize and disseminate knowledge.”

Depending upon which geographic region of the United States is viewed, the digital divide is prevalent.  In New York City, for example, it was noted that approximately 20 percent of households in 2017 do not have residential Internet services and do not have mobile Internet options available. Additionally, Bronx, New York shows 26 percent of households without access. The majority of the unconnected are minority and poor.1 In the September 7, 2017 Governing periodical it was pointed out that even with the rapid increase of Internet services and new digital devices, numerous low-income municipalities are lacking Internet access.  It further stated “Slightly less than half of all households with incomes under $20,000 reported having Internet access in the Census Bureau’s most recent American Community Survey. By comparison, about 93 percent of wealthier households with annual incomes exceeding $75,000 were connected.”

Even the Federal Reserve Banks of Dallas/San Antonio at a Consumer Compliance Conference on March 21, 2017 reported: “Of the 381 metropolitan areas in the U.S., those with the lowest rates of computer ownership and Internet use include three Texas border metro areas.” The three areas referenced were the McAllen/Edinburg and Mission areas, of which Alton, Texas, is included.  It noted only a 55.2% ownership/access ratio.

Enter the City of Alton, Texas and the City of Alton Development Corporation

The City of Alton was incorporated on April 1, 1978 as a General Rule Charter City and subsequently became a Home Rule Charter City in May 2006. The City of Alton Development Corporation (CADC) that consists of 4A and 4B corporations, respectively, was established in July 1996.  Currently population, according to the latest Census Bureau is 17,500 as the city is located in the Rio Grande Valley (RGV) in Hidalgo County. The RGV is commonly referred to as South Texas.

Within the corporate limits of Alton, three different public school districts exist: La Joya ISD, Mission CISD and Sharyland ISD.  The total number of schools of various grade levels is nine, of which Mission CISD has a total of seven, including a Collegiate High School.  Alton elected officials and members of the non-profit board of the CADC were acutely aware of the “digital divide” as it existed not only for the residents and commercial owners of Alton but also for the educational units within the city limits.

While the city has increased from a population in 2000 of 4,100 to 17,500 in 2018, further thresholds for closing the digital divide within the city were apparent.  Steve Pena, Chief Executive Officer for the CADC advised that: “The City of Alton elected officials and the CADC board members had been in discussions since 2014 researching the construction of a Wi-Fi project for the city.”  

One of the mission goals in closing the digital divide was to allow a certain level of access to students without cost consideration for them to complete school assignments assigned for home. A partnership with the Mission CISD, the City and CADC established the first Digital Library for the public and school children. A reading portal called MyOn was set up where Kindergarten through the 12th grade levels could access books/periodicals from any device with Internet access.  The facility opened in 2018. The cost to the City was $51,900 for the ICT hardware/software from Capital Construction Funds funded from a 2017 Certification of Obligation bond, while $145,000 has been budgeted from the General Fund of the City for operational expenses.

Background for Wi-Fi for the City: Challenges and Options

While it has been stated that there are salient and compelling reasons for implementing digital access, ample support from a scholarly viewpoint supports the need to close the digital divide.  As one researcher noted, “Scholars of digital inequality have explored the myriad ways that offline forms of inequality are reproduced in the digital realm both within and across countries Important connections have been made between digital inequalities and larger social inequalities including gender, economic status, race and ethnicity, age and educational attainment.”2She further writes that, “Thanks to these scholars, digital resources are recognized as necessary for improved life chances and well-being. Digital resources have even been framed as a public good”3

With the goal to close the digital divide in Alton, officials did indeed identify ICT and the provision of a “public good” as an attainable goal. According to the Community Networks Community Network Map, there are over 750 communities nationwide in which local governments have invested in wired telecommunications networks as January 2018.4

According to Pena, wired telecommunications appeared to be a viable option in 2014.  However, research and cost estimates proved otherwise.  As a small city and corporation, as are most municipalities in the area, funding is always a fundamental challenge.  Initial budget estimates proved to be in the $3 million range.  With the continuing development of technology, the CADC researched the scope of ICT and the approach to secure such technology with a planned implementation for budgetary and transparency considerations.

In reviewing the approach to close the digital divide, several components stand out from the Alton case study.  Specifically, four concepts were identified which laid the foundation and subsequent growth of the Wi-Fi system currently in place within the city - trust, public-private partnerships, financial planning and transparency.  Trust and public-private partnerships are intuitively linked together. One definition of trust relates that it is “assured reliance on the character, ability, strength, or truth of someone or something”5 Dr. Michael Kosfeld, Professor at Goethe University in Frankfurt, Germany, performed research linking it to the neuroscience approach. Using this biological approach, he indicated that it is a part of human nature. His research indicated that participants cooperated more when they shared an identity with their partner.6

A trusting partner came in the presence of WiFiRUs LLC.  The firm is owned by Dr. Gilberto de los Santos, Professor Emeritus, University of Texas Pan American (Now University of Texas Rio Grande Valley). Dr. de los Santos owns a Marketing Consulting and Technology Company located in the Rio Grande Valley of Texas.  While he has a resume of 52 years in combined experience in marketing and IT, his previous entry in the City of Alton was in the area of providing a housing need that existed within the city.  In 2007, one of his companies built a multi-family apartment project based upon the housing needs within Alton.  With limited participation from the city, he provided a $7.8 million project.

Utilizing the research gathered on Wi-Fi technology, the CADC with the support and oversight from the Mayor and City Commission and City Manager, entered into a pilot project with WiFiRUs to determine, not only the viability of the technology but also the accessibility of the ICT to those within the umbrella testing pilot for a three month period. Based upon the limited test area, data was gathered to illustrate that over 3,000 contacts were made during the duration. Interviews were conducted that showed the viability of the signal and reliability.7

Based upon the positive pilot program, proposals were then received in the public forum by the CADC to determine the financial component.  At this point, the CADC put forth the concept of a public-private partnership.  Legislation existed under the Public and Private Facilities and Infrastructure Act, Chapter 2267, Texas Government Code for such a partnership to occur.  At this juncture, the policy issue was established that the original goal was to provide Wi-Fi without cost to residents and commercial establishments.  In order to insure the long-term commitment for this policy, the CADC undertook and will continue to take the lead in the ownership of all of the ICT equipment.

Thus, the private partner (WiFiRUs) was to provide the software and maintenance to the CADC with a ceiling cap on maintenance.  In addition to insure the integrity of the overall system, the private partner would have sole oversight of any additional premium pay channels to the end subscriber, if they elected to engage such services.  With regard to public-private partnerships, one researcher noted that: “The term public-private partnership has been muddied in the past ... public entities and private companies must both have skin in the game to balance the risks and amplify the rewards.”8

With regards to financial planning, the public-private partnership established a budget with a ceiling/cap and guaranteed the total cost of the project.  Moreover, the project was broken down into four phases spread out over three years. The total cost of the project when authorized by the CADC was $1.437 million.  In addition, the City of Alton, in cooperation and acceptance by the CADC and the private partner, WiFiRUs, contributed $250,000 from its Capital Construction Funds to the CADC.  In order to finance part of the initial stages of the Wi-Fi project, the private partner agreed to borrow $125,000 from the CADC with an interest carry of 3 percent with repayment to occur within six years.  The unique financial planning aspect of the model allows the CADC to authorize the phases contingent upon available funding.  In this manner, the project is built on a pay as you go method, without any undue debt.  As of May 1, 2018, Phase I of the project had been implemented and activated which accounts for 30 percent of the coverage area for the city.

All of the transactions were conducted in a public setting that allowed transparency of all parties, especially when public funds were utilized.  The underlying research and identified components provide a foundation from which general presumptions can be drawn and applied towards any specific Wi-Fi project. The conceptual and research overview given in the case study are not intended to provide all of the necessary and due diligence in the details for such a project.

Endnotes

1https://citiesspeak.org/2017/03/21/want-to-close-the-digital-divide-for-cities-partnerships-are key/

2 Laura Robinson (2018) The identity curation game: digital inequality, identity work, and emotion management, Information, Communication & Society, 21:5, 661-680, DOI: 10.1080/1369118X.2017.1411521

3Ibid.

4https://muninetworks.org/communitymap

5https://www.merriam-webster.com/dictionary/trust

6Opitz, L. K., Kosfeld, M., & van Dick, R. (2014). Who shall I trust? Trust as a mediator between identity salience and cooperative behavior. Schmalenbach Business Review, 66(5),50-64.

7Information provided by Steve Pena, CEO, City of Alton Development Corporation, Texas

8 https://muninetworks.org/reports/secrets-behind-partnerships-improve-internet-access

John R. Milford is a Graduate Professional Practitioner Lecturer III Coordinator – Certified Public Manager Program, at the Public Affairs and Security Studies Department, College of Liberal Arts, University of Texas Rio Grande Valley, Edinburg Campus, Edinburg, Texas and Lifetime Member – Texas City Management Association. He can be reached at: john.milford@utrgv.edu.

Picture Courtesy of City of Alton Texas Development Corporation and Wi-FiRUS, LLC, USA.

INFORMATION & COMMUNICATION TECHNOLOGY

Closing the Digital Divide: A Case Study in Alton, Texas
By  John Milford