In partnership with The Colorado Health Foundation and the Finance Authority of Maine, Arctaris will deploy Opportunity Zone capital to deliver affordable broadband access to underserved communities.
BOSTON–(BUSINESS WIRE)–#affordablehousing–Arctaris Impact Investors, LLC (“Arctaris”) announced new Opportunity Zone investments in broadband infrastructure that will provide affordable, high-speed internet access to multiple low-income communities throughout Colorado and Maine.
The project funding in both states will include an estimated $60 million of equity investment from the Arctaris Opportunity Zone Fund, combined with guaranty agreements from The Colorado Health Foundation and the Finance Authority of Maine, which provide a principal-protection cushion equal to 20% of each investment.
“The Colorado and Maine programs show how foundations, government agencies and Opportunity Zone funds can team together to expand broadband access to low-income families and businesses located in some of the nation’s most challenging environments,” said Jonathan Tower, managing partner of Arctaris, a Boston-based impact investment firm founded in 2009. “We are working to replicate these programs in additional cities and states to increase digital equity throughout the U.S.”
Arctaris’s investments in high-speed fiber infrastructure will create pathways to prosperity, employment, online education, and telehealth for low-income families and businesses located in Opportunity Zones.
“Over the years, we have seen a widening gap between resources and opportunities available to residents without high-speed internet service and communities with robust networks,” said Neil Katz, Arctaris Vice President. “Unfortunately, COVID-19 has only intensified these broadband gap inequities.”
In Colorado, approximately 85,000 rural households, or 14% of Colorado households, have slow or no access to broadband. Many of these communities also lack adequate access to healthcare facilities and services. Arctaris has partnered with The Colorado Health Foundation (CHF) whereby Arctaris will invest $50 million, while CHF and its partners provide an upfront grant plus a $10 million capital guarantee to expand access to 25,000 households, enhancing access to healthcare facilities through telehealth services, and building digital equity throughout the state. Arctaris and its local partners have already identified 40 towns with lower than 80% broadband coverage.
“The Foundation is excited to explore the Arctaris partnership and how broadband expansion in rural Colorado could have a major impact in helping underserved communities gain much needed access. This initial market study will help any future public and/or private partners understand the who, the where and the how in terms of what impact can look like in Colorado,” stated Ben L. Bynum, M.D. Portfolio Director, The Colorado Health Foundation.
In Maine, due to a lack of density and a lower socioeconomic status many areas lack the economic profile that would attract traditional broadband investors. As a result, Maine communities experience higher retail prices and lower quality service. Arctaris has partnered with the Finance Authority of Maine (FAME) to expand broadband access in the cities of Belfast and South Portland. Arctaris will invest $8.5 million and FAME will provide up to $1.9 million in guarantees, plus a $1 million direct loan, in support of the program.
“High-speed internet access is more important than ever these days, with so many households working and learning from home. Financing this important project will make a huge difference to workers and residents in Belfast and South Portland who will be able to tap into much-needed broadband,” said David Daigler, FAME board chair. “FAME is pleased to be part of the solution as Maine moves to improve broadband access statewide.”
Arctaris plans to rollout similar programs and public-private partnerships in other parts of the country.
About Arctaris Impact Investors, LLC
Arctaris Impact Investors, LLC is a Boston-based impact investment firm with experience spanning more than 11 years, 5 funds, and both debt and equity investments. The firm manages the Arctaris Opportunity Zone Fund (2019), the Arctaris Impact Fund (2018), and three earlier Arctaris funds which invest in growth-oriented operating businesses and community infrastructure projects located in underserved communities. Founded in 2009, Arctaris has partnered with the Kresge Foundation, Harvard Business School Professor Michael Porter’s Initiative for a Competitive Inner City, and multiple other foundation, federal and state government agencies to invest in Opportunity Zones, inner cities and targeted rural communities throughout the U.S., with the aim of delivering above-market investment returns alongside positive social impact.
To learn more about participating in the Arctaris broadband initiative, local and state government officials or foundations may contact Brendan Lugossy at Brendan@arctaris.com. For more information on Arctaris or press inquiries, contact Jane Moncrief at Jane@arctaris.com or visit www.arctaris.com.
About The Finance Authority of Maine (FAME)
The Finance Authority of Maine (FAME) is a quasi-independent state agency that provides innovative financial solutions to help Maine citizens pursue business and educational opportunities. FAME helps to lead the creation of good paying jobs for Maine citizens by working at the nexus between economic and workforce development. To learn more about FAME, please visit www.famemaine.com.
About The Colorado Health Foundation (TCHF)
The Colorado Health Foundation is bringing health in reach for all Coloradans by engaging closely with communities across the state through investing, policy advocacy, learning and capacity building. For more information, please visit www.coloradohealth.org.