Hillsboro says city-owned internet to reach 50% buildout in 2024
Hillsboro officials say HiLight — Hillsboro's city-owned high-speed internet service — should be available to half of all city's addresses between 2024 and 2025, years earlier than expected, according to a new plan presented to city councilors Nov. 2.
From the beginning, Hillsboro officials knew the buildout process for HiLight would be slow. They expected to construct fiber-optic cables throughout the entire city over the course of about 10 years, prioritizing neighborhoods such as those around Shute Park with low rates of high-speed internet connectivity.
The service first launched for about 800 residents and businesses around Shute Park nearly a year ago, but officials have an updated plan to expedite the process, speeding up HiLight's full buildout by an estimated four years.
HiLight officials plan to complete the buildout of the internet service between 2026 and 2027.
The service offers city residents 1-gigabit internet speeds for $55 per month — less than the price for the same speed internet of other providers in the area.
Residents who qualify for federal low-income assistance programs can purchase 1-gigabit internet for as low as $10 per month, which officials say is an affirmation of Hillsboro's commitment to equity.The service doesn't cap data or slow internet speeds based on how customers use it.
Earlier this year, the City Council made it a priority to complete HiLight as quickly as possible. Greg Mont, Hillsboro's information services director, told councilors Nov. 2 that the updated plan was a response to the City Council's goal.
"The question has been: How can we speed that up and accelerate that so it doesn't take 10 years?" Mont said. "Certainly, based on some feedback we've gotten from different residents around the community, they would appreciate that, too."
An area around Shute Park west of where the HiLight first launched last year to the city's western limits will be the second area to receive the service. Brad Nosler, HiLight's general manager, said on Nov. 2 about 1,100 addresses in that area will receive the service within a few weeks.
By January 2022, officials expect to be able to activate HiLight in an area of South Hillsboro with nearly 800 more addresses.
Construction of HiLight's fiber-optic cables in South Hillsboro will continue for the next few years as the area continues to be built out. The massive development is expected to add as many as 20,000 new residents to the city.
Officials expect an area east of Southeast 10th Avenue and north of Tualatin Valley Highway, will receive have access to HiLight later in 2022.
Between 2023 and 2025, officials plan to finish constructing HiLight infrastructure in a large area of the northwest part of the city, providing access to an additional 12,000 addresses.
When the buildout is completed in that area, about half of the city's population will have access to HiLight, Mont said.
Hillsboro had to secure additional funding to pay for the expedited buildout. So far, Hillsboro has spent $16.5 million on construction and operations for HiLight.
Between the 2018-19 and 2024-25 fiscal years, officials originally planned to spend $28-32 million on HiLight overall.
Officials now plan to spend $17 million more than that during the same timeframe after securing an additional $14 million from the state's Gain Share program as well as $3 million from the federal American Rescue Plan Act, said Suzanne Linneen, Hillsboro's finance director.
Hillsboro has been financing HiLight using Gain Share funds from the beginning. The program allows local governments to access increased state income tax revenue from new jobs created by large private capital investments. Property taxes, which largely fund local governments, for the capital projects are delayed, incentivizing such investments.
Officials have long intended for the service to pay for itself once it is fully built out and customers are using it.
While surveys of current customers show they are largely satisfied with HiLight, the service only has a total of 128 residential and commercial customers out of nearly 1,400 serviceable addresses a year after being launched.
Despite the low number of current customers, HiLight officials said the market share of residential customers is close to what they projected it would be, at about 13%. Nosler estimated competitors such as Comcast and Ziply Fiber have market shares of about 60-65% and 12-17%, respectively.
In response to questions from city councilors, who were largely supportive of the updated buildout plan, Nosler explained that HiLight is marketing directly to residential customers with mailers and door hangers as well as on social media. He added that staff are talking directly to business owners about the service.
Mont emphasized that HiLight hasn't been available for a full year, yet, adding that the slow uptake of the service is to be expected.
"We deliberately chose an area that has low connectivity rates traditionally," Mont said about where HiLight first launched.
After 2025, Hillsboro will have to come up with additional sources of revenue to finance the buildout in the remaining portions of the city, including much of the eastern part of the city, officials said. The state's Gain Share program is set to expire in 2025.
Linneen said officials will explore additional Gain Share funding before it expires as well as federal infrastructure funding, state and federal grants, and bank loans or bonds.
She added that risks could pose issues to the new buildout plan, including construction delays, private-sector competition, assumptions about modeling and others.
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