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Posted on Tue, Aug 24, 2010 : 3:50 p.m.

$111M in stimulus funds to Ann Arbor nonprofit's Internet project boosts Michigan, supporters say

By Nathan Bomey

Merit Network CEO Don Welch and Governor Jennifer Granholm in Ann Arbor .JPG

Gov. Jennifer Granholm, pictured with Merit Network CEO Don Welch, said today in Ann Arbor that Merit's stimulus funding shows that Michigan's economy is benefiting from the federal program.

Melanie Maxwell |

The $111 million in funding awarded to an Ann Arbor-based nonprofit to improve Michigan’s broadband Internet access illustrates the importance of 2009’s federal economic stimulus package, Gov. Jennifer Granholm said this afternoon at a press conference.

The funding - $33.3 million awarded in January and $69.6 million awarded last week - will help Merit Network construct more than 2,200 miles of fiber optic cables to hasten high-speed Internet access in the Midwest.

Granholm said Merit Network's funding is an example of how the $787 billion American Recovery and Reinvestment Act is sparking Michigan’s economic revitalization. Merit Network is believed to be the Ann Arbor region's largest recipient of stimulus funds outside of the University of Michigan.

Michigan has received about $7.7 billion in funds for nearly 7,200 awards from the economic stimulus package, according to

“We would not be able to do this at all were it not for the Recovery Act and the brave folks who voted yes to do that,” Granholm said at Merit’s offices in Ann Arbor.

Her comments came as the stimulus package is turning into campaign topic during general election season, prompting the Democratic Party to defend the bill in public appearances.

A poll released in July by Rasmussen Reports showed that 42 percent of Americans believe the stimulus bill hurt the economy and 29 percent believe it helped.

"We do not have the luxury of waiting months for the president to pick scapegoats for his failing stimulus policies," U.S. Rep. John Boehner, the Republican minority leader, said this morning in Ohio, according to the Wall Street Journal. "We've tried 19 months of government-as-community-organizer. It hasn't worked."

U.S. Rep. John Dingell, D-Michigan, said today in Ann Arbor that improved high-speed Internet access is a worthwhile investment.

“This is absolutely critical to this state modernizing its economy and competing in the 21st century,” he said. “It’s going to ensure that we are not passed over - particularly the people in the north.”

Granholm said the funding provided to Merit is necessary to improve access to high-speed Internet in Michigan’s underserved regions. She said it would give business people and aspiring entrepreneurs access to information that would help them compete in today’s dynamic economy.

“I’m telling you that projects like this, which create this 21st century infrastructure, this will be huge for Michigan’s future in terms of education and giving all children access to the globe in terms of entrepreneurship, giving everyone the chance to sell, to transact business online,” she said. “There are so many corners of Michigan that have not had that opportunity.”

Merit’s program - which includes some $30 million in investment from private sector partners - aims to improve high-speed access to some 569 “community anchor institutions” such as universities, schools and libraries.

Merit CEO Don Welch said that private companies are paying for access to some fiber strands on the network, which they will use to sell Internet access to residents in underserved areas of both of Michigan’s peninsulas.

“The value will eventually get down to the homes and businesses,” Welch said.

Merit, which has about 71 full-time employees in Ann Arbor, is hiring about two new employees a month to staff its growth. Merit is a 44-year-old nonprofit whose primary purpose is to broaden high-speed Internet access and connect educators, researchers and community members.

Welch said the construction of the 1,017-mile network in the Lower Peninsula and the 1,210-mile network in the Upper Peninsula, Wisconsin and Minnesota would require some 20 construction teams. Crews will do most of the work in summer 2011.

“This program is a textbook example of government investment done right with government funding catalyzing millions of dollars of additional private and local investment,” said Larry Strickling, assistant secretary for communications and information at the U.S. Department of Commerce and administrator of the National Telecommunications and Information Administration.

Contact's Nathan Bomey at (734) 623-2587 or You can also follow him on Twitter or subscribe to's newsletters.



Wed, Aug 25, 2010 : 11:36 p.m.

You can bet that you won't see any fiber laid by the 3% of the country that received $700 billion in tax breaks. They are busy shipping that money out of the country so they don't have to pay any taxes on it. Giving tax breaks to the top 3% in the country didn't stimulate job growth eitherof W's two terms. It just added to the National debt. But this stimulus money will go directly into the hands of fiber installers all over the state. I call that needless Pork. Why waste that money, give it to the top 3%, they need all they can get, the $700 billion is not enough.

Nathan Bomey

Wed, Aug 25, 2010 : 11:51 a.m.

@KenUM No decision yet from Google, but we plan to revisit that topic soon. Google has said only that it will announce the winner "by the end of the year."


Wed, Aug 25, 2010 : 11:48 a.m.

Has Google made a decision on locating the fiber optic experiment that they had the cities competing on earlier this year? For some reason this article and the promise of broadband article made me remember the big competition.

Mr. Tibbs

Wed, Aug 25, 2010 : 8:29 a.m.

I will believe this when I see acces out in my neck of the woods. How uch you wanna bet, only liberal places will recieve upgrades and conservative areas will be locked out of the money. net neutrality.....

Top Cat

Wed, Aug 25, 2010 : 7:44 a.m.

Ms. Granholm is sounding a bit more desperate in her pandering and trolling for a job in the Obama Administration. Since she is such an expert on unemployment, I would think she would fit right in.


Wed, Aug 25, 2010 : 12:43 a.m.

Fix the dang bridge!


Tue, Aug 24, 2010 : 8:29 p.m.

EyeHeart2, None of Merit's employees are paid from the general fund. If their budget allows them to pay their staff that way, then why are their salaries an issue? What, in your estimation (and without knowing what Merit even does), would you say is fair compensation? The grant funding is limited to capital expenditures - no operational costs and no salaries - just stuff. Think, Yes there are plenty of anchor institutions without adequate broadband connections in the state. Until very recently, the entire Upper Peninsula was served by a single fiber route for all telephones, data lines, Internet connections, etc. When that fiber was cut (and that happened more than once) everyone - at the public institutions and in private businesses alike -lost phone and data services including banking services and other things you wouldn't normally think about. Anchor institutions aren't just universities. Hospitals, county mental health facilities, policing agencies, emergency medical service providers, social service agencies, K-12 school districts, libraries, local governments, community colleges, tribes, etc., are all considered community anchor institutions and they'll all benefit from this grant as will the rest of the state, contrary to what some of our more short-sighted friends would like to believe.


Tue, Aug 24, 2010 : 7:38 p.m.

Previous posters might also want to read the NTIA BTOP solicitation before jumping to completely unfounded conclusions about where the money is going. (Hint, it's basically capex.) Also, if you knew your history, you would know the role Merit played in creating NSFnet, the precursor to the commercial internet. Merit is a bona fide treasure for the state of Michigan with an illustrious history. The organization can be very proud of its success in bringing improved broadband to Michigan. It did very well compared to most other state and regional non-profit networks and that will benefit the entire state.


Tue, Aug 24, 2010 : 7:19 p.m.

"The funding... will help Merit Network construct more than 2,200 miles of fiber optic cables to hasten high-speed Internet access in the Midwest." "Merits program - which includes some $30 million in investment from private sector partners - aims to improve high-speed access to some 569 community anchor institutions such as universities, schools and libraries." Ok, so they plan on laying fibers to "community anchor institutions". Are there really universities, schools and libraries in the state that don't have broadband service? Wasn't there a Granholm plan, once upon a time, to make sure broadband existed in every home in Michigan? Does this mean that folks who are not in a broadband-coverage area will finally get covered?


Tue, Aug 24, 2010 : 6:04 p.m.

In this case, federal stimulus money will help meet strong public demand in an area where the private sector has failed to step up to the plate. After fifteen years, many localities and regions outstate continue to be underserved by suppliers of broadband service. The U.S. has fallen behind other countries who have policies directly supporting broadband expansion, and this project is one way to start closing that gap, at least in our region.

peg dash fab

Tue, Aug 24, 2010 : 5:14 p.m.

eyeheart2: your grandkids will be paying for the disastrous Bush-era policies that produced the horrible economic straits we are suffering. Good luck to you... and to them. Stephen Landes: it is simplistic thinkinglike the notion that cutting taxes is the solution to every problemthat got us into this mess: the Bush administration was all about cutting taxes, especially for the richest of the rich. Now that those policies have left the world economy in tatters, how about if we listen to smart people for a change? Keynes would be a great place to start!


Tue, Aug 24, 2010 : 5:12 p.m.

EyeHeartA2, Merit has been around for nearly 45 years and is a bona fide non profit corporation. It is governed by Michigan's state universities and is a prime example of what can be accomplished when the universities work together. Merit is self-funded; it generates its income based on the services it provides not only to the universities, but to all of the other non-profit and municipal organizations it serves. There's nothing sinister about Merit; it's one of Michigan's real treasures. Federal grants generally don't cover administrative costs so I doubt that there's a lot of fat in the grant for bonuses. The majority of the money will be used to pay for the construction of the network. Before you make assumptions about Merit and the people who work there, do a little research.

Stephen Landes

Tue, Aug 24, 2010 : 3:18 p.m.

"the value will eventually get down to the homes and businesses, Welch said" OK, so what we have is a Democrat version of "trickle down" economics, but it is OK because the government is in control. Just reducing taxes, so people keep more of the money they earn and then can make their own decision about what is valuable to them isn't OK because government is not in control. Some people might prefer to save their money for education or health care or some other purpose and not have it spent for them on high speed internet. Everybody got that?


Tue, Aug 24, 2010 : 3:10 p.m.

I doubt Mr Welch will be the only one from this "non-profit" benefitting big time from this grant!