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New co-op forms in effort to advance fiber project

Sibley County recently opted out of effort

October 25, 2012
By Fritz Busch - Staff Writer , The Journal

WINTHROP - A new fiber cooperative is rapidly forming in Sibley County after Sibley County commissioners deciding to opt out of the Renville-Sibley (RS) County Fiber project Tuesday by a 3-2 vote.

"We're looking for an alternative way to bring fiber to Sibley County. We're forming a new cooperative because we feel it's important. Farmers need it and want it," said rural Sibley County resident Jeff Nielsen, who acknowledged that he was the United Farmers Cooperative (UFC) General Manager. However, he said he was not acting in that capacity at the RS Fiber Joint Powers Board meeting Wednesday in Winthrop City Hall.

"We anticipate a relationship with the RS Fiber group, form an agreement and operate together," Nielsen said. "We plan to raise capital. We'll work as fast as we can in the coming weeks. ...We'll be our own network and engage RS Fiber at arms length. We're interested in spilling over in any other county that wants to participate."

"There are no boundaries," said Winthrop City Administrator Mark Erickson.

"Isn't this great?" Erickson said to RS Fiber Marketing Committee member and rural Gibbon resident Linda Kramer who has been working on the project with weekly meetings and attending public events for more than a year.

"I'm excited people are coming together to find a solution," Kramer said. "Fiber and all the opportunities it brings will be great for Sibley County."

The news of a new fiber project cooperative was music to the ears of Sibley County Economic Development Director Tim Dolan and others.

"This is the technology we need," Dolan said. "Where there is a will, there is a way. We'll find a way."

After the business meeting Erickson commended the RS Fiber Project Marketing Committee for all its work to promote the project.

"If not for the marketing committee, we wouldn't have all these cities on board," Erickson said.

The RS Fiber Joint Powers Board set a deadline of Wednesday, Nov. 7 for Renville County city councils plus Henderson to approve a revised project business plan with new numbers. Sibley County commissioners recently opted out of the project, which is estimated to require about $70 million in revenue bonds.

Minneapolis attorney Peter Cooper of the McGrann Shea law firm presented the Joint Powers Board with a Letter of Engagement with the RS Fiber Project dated Oct. 19, 2012 to act as a Special Local Counsel to continue discussions with the board, bond counsel and underwriter's counsel on the project to provide required opinions, due diligence, complete review of the Shortfall Funding Agreement, Amended and Re-stated Joint Powers Agreement and review related documents at a total estimated cost of $70,000.

Prior to the Sibley County vote Tuesday, County Attorney Dave Schauer said the county was seeking legal counsel that would authorize moving forward with the project. Previous legal firms did not authorize the project after looking at its details.

In a letter dated Oct. 2, 2012 to Sibley County commissioners and Schauer, Verlane L. Endorf of Dorsey & Whitney, LLP of Minneapolis, wrote that after examining relevant law, conversations with bond counsel and lawyers from firms that represent other members of the (Renville-Sibley County Fiber Joint Powers) Agency, and bond counsel discussing the authority of members' participation in the bond transaction, Dorsey & Whitney was unable to reach the certainty necessary to determine that the Joint Powers Agreement and Shortfall Agreement would, if challenged, be upheld in the courts.

Endorf added that the opinion did not mean the county is legally prohibited from (project) participation. "It is not uncommon for law firms to reach different conclusions on the same examination of the law and the facts of a particular transaction," Endorf wrote.

The next RS Fiber Joint Powers Board meeting was set for 7 p.m., Thursday, Nov. 8.

(Fritz Busch can be e-mailed at



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