BY SHANE PETERSON | NEWS EDITOR

North Carolina guaranteed Internet access to everybody by 2003. Audacious? Yes.

Attainable? Yes, again. Heres how the state orchestrated the deal.

Like many state officials, members of North Carolinas administration and legislative houses have spent considerable time worrying about the digital divide. States know full well that they cant depend on old-world infrastructures in todays move-fast-or-get-left-behind economic milieu.

North Carolina is in a difficult position as it continues to make its transition to the Information Age -- tremendous growth in its metropolitan areas, flat or lagging growth in rural areas coupled with a disproportionate number of layoffs in those areas, and a disappearance of income from tobacco, which has been, and still is, the states number one cash crop, said Leslie Boney, staff director of the Rural Prosperity Task Force.

Gov. Jim Hunt formed the task force in 1999 to craft recommendations to revitalize the states rural areas, and, not surprisingly, the task force identified high-speed Internet access as one solution.

North Carolina placed sufficient emphasis on this recommendation to guarantee high-speed Internet access to all areas of the state within three years and local dial-up access from every telephone exchange within one year. Behind that guarantee is the deal the state orchestrated with its three largest telecommunications companies -- BellSouth, Sprint and GTE.

What Not to Do

Although the deal was eventually hammered out, it wasnt the easiest undertaking ever brokered by state officials. One early hurdle was the way it was first presented.

The task force first proposed a deal that included the one-year and three-year goals and an eight-cent surcharge on every monthly phone bill in the state for three years -- this would have added up to approximately $15 million that would have been used to fund the roll out of telecommunications services to rural areas of the state.

"Basically, everybody would have been paying a dollar more per year on their phone bills to help fund something we called the Rural Broadband Access Fund," Boney said. "The providers, whether they be ILECs [incumbent local exchange carriers], CLECs [competitive local exchange carriers] or some other provider, could then have applied to that fund to help them make the business case to deploying to rural areas sooner rather than later."

This provision -- which the task force proposed because the legislation that created the Rural Internet Access Authority, the group that will be responsible for implementing the goals and objectives of the deal, did not allocate funds for the authority -- did not make the telecommunications companies happy.

"They didnt like the idea of their customers being asked to pay an additional surcharge on their bill every month," Boney said. "They didnt think that would go over well with their customers. They were concerned that the proposal as the task force designed it would have put them in the awkward position of being blamed for an increase in peoples phone bills when, in fact, they didnt have anything to do with it. Nobody likes to be blamed for something thats not their fault."

The parties huddled in their respective headquarters, and the telephone companies came back with a version of the deal that didnt include any surcharges -- solving that particular problem.

North Carolina officials were careful from the outset to avoid another potential hurdle, becoming fixated on the technological approach.

"A lot of people get hung up on technology in this sort of deal," said Tom Runkle, chief planning officer of the states Office of Information Technology Services. "Technology is the least important thing. Just agree that you dont care about the type of technology and let the right type at the right time win. Otherwise, people will