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  • Galloway workers were in Pine Knot Saturday checking Highland’s new fiber optic lines. Janie Slaven

    Galloway HTC
June 20, 2012

Highland Telephone upgrade nearing completion

Annual board meeting attracts concerned co-op member

By JANIE SLAVEN News Editor

WHITLEY CITY —  Highland Telephone Cooperative’s Board of Directors held their annual meeting at the McCreary County office last Tuesday evening.

    Topping the agenda was an update on the co-op’s $66 million fiber optic upgrade, which will extend broadband and video services to all of Highland’s 23,000 members in three counties (McCreary in Kentucky, Scott and Morgan in Tennessee).

    The project’s construction phase is nearing completion in McCreary County, though officials were reluctant to say when services would be made available. HTC General Manager Mark Patterson explained that once construction is complete, some changes would also be needed at central office before the cutover phase — where each home/business is changed from copper to fiber optic connections.

    “We have to send someone out to every house,” Patterson said. “There’s 5-6,000 phones in McCreary County. Customers won’t have to wait for the whole county to be completed. It’ll be by streets, rolling like a wave.”

    Patterson said that internet customers “will be amazed” by the increase in speed. The existing 1.5-megabyte per second download will increase to at least 5 mps with greater speeds available depending on the service customers sign up for.

    In terms of cable service, HTC has been granted a local franchise and is working to secure Kentucky channel feeds even though McCreary County is considered to be part of the Knoxville DMA (Designated Market Area).

    “We have Kentucky directors who won’t stand for that [a Tennessee-only channel lineup],” Highland attorney Ernest Petroff said, referring to Sam Strunk, Shelva Jo Jones and Loma Denney.

    The upgrade was made possible through the 2010 award of $66.4 million in stimulus funds from the USDA Rural Utility Service Broadband Initiatives Program — $50 million in grant monies in addition to a $16 million loan.

    In addition to the fiber optic upgrade, HTC officials addressed the concerns of member Maynard New. In addition to several questions about fees and taxes added to his monthly bill, New expressed concern about the fact that members are no longer receiving capital credits.

    Cooperatives do not earn profits as investor-owned utilities do. Instead revenues are returned to members in proportion to their usage — local telephone service, in Highland’s case.

    Petroff told New that the disbursement of capital credits was suspended indefinitely by the board in 2009 when it became clear that the co-op was going to suffer its first loss in many years. Petroff noted that, while the board would like to reverse the policy, it could be some time before capital credits are re-instated.

    In addition to the resources tied up in the fiber optic project, HTC board chairman James Terry cited the loss of customers to cell phones and the closure of several area businesses as reasons for the financial crunch. Additionally, revenues earned from internet and cable services are considered part of HTC’s subsidiary corporations, Highland Communications and Highland Media.

    New urged the board to consider at least the return of estate capital credits for the families of members who are deceased.

    Petroff added that between 1991 and 2008, HTC returned some $12 million to its customer-members.

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Madie Parriman

McCreary County Sheriff Gus Skinner (center) and Deputy Tom Smith escort Madie Parriman to a cruiser following her arrest on a federal indictment yesterday.

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