WATCH: Lease Targets Rural Broadband

State leaders say the deal will boost quality of life in rural areas and spark economic development opportunities.

State leaders say a new agreement to lease communications infrastructure will pay big dividends for the economy, specifically for the rural agriculture and telehealth sectors. The deal with Ohio-based Agile Networks, which could net the state more than $260 million over 50 years, aims to bring broadband service to areas of the state that currently have no access. Indiana State Department of Agriculture Director Ted McKinney says Hoosier farmers and agribusinesses must have access to reliable broadband in order "to grow and thrive in today’s economy, as well as to remain competitive globally."

In an interview with Inside INdiana Business, Indiana Office of Management and Budget Director Micah Vincent says the transaction also helps the state hit an important benchmark in funding bicentennial projects.

Vincent says the deal will boost quality of life in rural areas and spark economic development opportunities. He says it will make for a healthier community by providing the network needed for telemedicine opportunities, allowing residents to have "virtual visits" with health care providers. Vincent says it will also increase access to online education, resulting in a stronger work force.

Indiana Secretary of Commerce Victor Smith says a strong broadband network is "just as important as the roads, rails, waterways and skies that connect Hoosier businesses to their customers around the world." He says the lease will give Hoosiers in underserved areas "improved access to a key tool for innovating and launching new businesses."

The agreement calls for Agile Networks to make an initial payment of $50 million to manage, operate and market Indiana’s communications infrastructure for 25 years. The company would also pay the state around $46 million in expected revenue over the course of the deal. If Agile Networks exercises an option to extend the agreement for an additional 25 years, it would pay another $10 million up front and around $164 million in expected revenue over the renewal term.