Spat between EC Fiber and its Service Provider GWI takes a new twist

We've come to take the existence of EC Fiber (ECF) in Thetford and across the east-central region of Vermont for granted. It's been a rural internet success story starting in 2008 as a consortium of 23 towns that banded together to attain affordable high-speed internet. An alliance of towns was the only way to obtain this service. Corporate internet providers ignored rural areas because there were too few potential subscribers to make it profitable. Lacking state or federal support, it took until 2011 to raise enough money to build the first 25 miles of high-speed fiber optic network.

ECF has become what is known as a Communications Union District — the oldest one in Vermont — thanks to lawmakers who, in 2015, recognized the need for this type of "municipal entity" in building out rural broadband. Today EC Fiber has almost 10,000 customers and 1,750 miles of fiber optic cable spread across 31 Vermont member towns.

While ECF customers receive high speed internet and phone service via fiber optic cables installed through ECF, the company relies on a Service Provider for management and operation of this network and its connection to distant web servers that are the backbone of many online services. Up until 2022, ECF's Service Provider was the non-profit ValleyNet. However this association was terminated after it was discovered that a contracted ValleyNet accountant had embezzled almost $600,000 over ten years. In real terms this amounted to a loss of over $1 million because the money could have been used to grow ValleyNet's business.

ECF then contracted with GWI (Great Works Internet, also known as the Maine-based Biddeford Internet Corporation) as its new Service Provider. According to the GWI website, the company "designs, manages, and operates (EC Fiber's) 1,400-mile (sic) fiber network for a 31-community Communication Union District, providing gigabit service to over 27,000 premises managing over 10,000+ (sic) customers."

But all is not well with this relationship. The contract with GWI runs through the end of 2025, and ECF wants out. According to ECF, GWI sought to negotiate a new contract giving it "two to three times more money than ECF's revenue could support." GWI also wants much more authority to make decisions for ECF.

To replace GWI, a new nonprofit entity named VISPO, modeled after ValleyNet, would be created by ECF to fill the role of Service Provider. Quoting ECF, "The VISPO is a public-benefit non-profit corporation established to provide essential government services in conformance with IRS Code Section 115. This type of non-profit corporation is often used by cities or counties to run a government-owned electric utility. … It is proposed that VISPO would have its headquarters in S. Royalton, to be staffed by local employees."

In response GWI issued a series of court challenges. They assert that they introduced superior expertise and investments and significantly enhanced the ECF infrastructure and network. They also assert that Mr. F. X. Flinn, the chair of ECF's governing board, "hatched a plan to form his own management company and then replace GWI with a combination of a new operating company and his own venture ... to pay himself a substantial amount of money. ... The upshot of this is that ECFiber will have to pay its current operator GWI through the end of the year, and on top of that staff, train, equip, and pay a startup for the remainder of the year, all under the transparently pretextual guise that a contract extension with GWI is somehow too expensive."

GWI also accuses Flinn of colluding with a GWI employee to record and steal proprietary information about GWI’s operations and future plans.

In turn ECF filed a motion to dismiss this challenge. The document included the following:

"GWI’s recording (by a concerned GWI employee whistleblower) revealing their plan to terminate many GWI employees that service ECF's network and immediately move (ECF's) customer service office, based in South Royalton, to a regional call center, made it all too apparent that GWI’s for-profit mission was incompatible with the District’s Vermont community service focus."

According to ECF, the whistleblower had approached not Flinn but another ECF board member “... Jeff Brand, Secretary of the Governing Board for the District, due to her genuine concerns about GWI’s Plans.”

They went on to state ".... Mr. Flinn has no intention of deriving income from VISPO. … VISPO proceeded to elect a seven-member board of directors that does not include Mr. Flinn and his involvement is now identical to his involvement with GWI: overseeing, administering and supervising the contractual relationship with the District in his capacity as Governing Board Chairman."

Following this rebuttal in May 2025, GWI, in mid-July, sent "an Open Letter to ECF Subscribers" in the form of an email to the selectboards of Thetford and other towns in the ECF network, reiterating in alarming terms their concerns that VISPO had been created "behind closed doors" and "without a public bidding process or a transparent opportunity for qualified providers—including GWI—to participate." They go on to say "Even worse, VISPO has no employees, no experience, and no demonstrated capacity to manage a broadband network of this complexity ..." and urging ECF customers to "demand transparency and adherence to VT's Open Meeting Law" plus "a competitive Request for Proposals process for long-term network operations, ensuring that only a qualified internet service provider is selected ..."

The response from ECF included the following passages:

"The unsigned letter seeks to instil fear, uncertainty and doubt within our community.

"As you know from our annual reports, ECF is required to show an operating surplus of at least 1.25 x its annual debt service (currently $5 million). Presently we take in over $13 million a year ... and our expenses are about $6.5 million. That leaves about $6.5 million, which is 1.30 x the $5 million in principal and interest due on our bonds. …In effect GWI wanted ECF to give them all that surplus and more. They told us it was a "market" deal and if we didn't want to pay they had plenty of other opportunities.

"So did we: return to the model of having a local non-profit operate ECF. ... A year of planning went into establishing the VISPO as a public benefit corporation established to meet Section 115 of the IRS Rules. …

"In the same way that neither ValleyNet nor GWI are subject to Open Meeting Rules, neither is VISPO."

Regarding the breakdown in negotiations and "GWI's desire for too much control … right now … all the money that gets paid to ECF goes into ECF bank accounts and all the expenses to operate ECF are paid out of those bank accounts ... ECF effectively controls expenses and is the owner of everything used in the business - all trucks, computers, office equipment, software ... GWI gets a check to cover payroll expenses, but that's for the ECF staff which the Operating Contract does not permit to be used for any other business.

"GWI wants a different arrangement. They want to pay most of the expenses and use ECF staff for whatever they want - mainly to help other Internet Service Providers. They want the (ECF) Board to pay fees per customer, per passing, for each customer added, etc. It's not a terrible idea and we might go for it if we didn't have the bonds to worry about, and if we didn't think the eventual result would be the loss of local good jobs. But we do have the bonds to worry about, and the bonds lose their tax-free status if anyone uses the (ECF) network to generate private profit, or if the government that issued the bonds loses control over strategic decisions or even setting prices.

"VISPO will run ECF the same way it's been run for the past 10 years, using the same systems … the same staff positions. It's up to those people to decide if they want to stay with GWI or become VISPO employees. The only threat to a smooth transition is GWI, which is why we are seeking enforcement of the Transition Policy ...

“VISPO has a prior ValleyNet CEO involved as well as a new CEO (Gopi Sundaram) whose career includes the buildout of fiber internet in Ireland ..." Sundaram is a graduate of Dartmouth's Tuck School of Business and has enjoyed a long career in the Internet Service Provider business as well as being a dedicated investor in broadband projects.

"Exactly what transpires over the next months is uncertain, but only because of GWI's inability to gracefully accept its failure to persuade. As for fear or doubt, we have none."