Commitments, Contingencies, and Concentrations

12 Months Ended

Dec. 31, 2012

Commitments, Contingencies, and Concentrations [Abstract]

Commitments, Contingencies, and Concentrations

Note 13. Commitments, Contingencies, and Concentrations

We are involved in certain contractual disputes in the ordinary course of business, but do not believe the resolution of any of these existing matters will have a material adverse effect on our financial position, results of operations or cash flows.

In August 2010, we were awarded a National Telecommunications Information Administration (NTIA) Broadband Technology Opportunities Program (BTOP) grant to extend our middle mile fiber-optic network across greater Minnesota connecting health care facilities, schools, libraries, higher education institutions and public offices with an advanced high-capacity broadband network. This project involves approximately $24,000,000 of capital expenditures of which $16,800,000 is funded by the NTIA grant. We began capitalizing costs associated with this project in 2010 and began receiving grant funds in June 2011. The following table provides an overview of the capital expenditures incurred or received from the program. We anticipate the completion of this project by August 2013.

	Project Activity
(Dollars in thousands)	2012		2011		Project Total
Capital expenditures incurred	$	7,081	$	12,664	$	19,745
NTIA reimbursements received	$	5,745	$	6,945	$	12,690
Capital expenditures pending reimbursement	$	1,100	$	1,920

Most of our revenue from our equipment practice is based on sales of Cisco-branded products. The loss of Cisco as our principal supplier could significantly impact this revenue stream.

We have a collective bargaining agreement with the International Brotherhood of Electrical Workers Local 949, which involves approximately 18% of our employees. The current labor agreement expires in 2013.

Operating Lease Commitments

We own most of our major facilities, but do lease certain office space, land and equipment under principally non-cancelable operating leases.Rental expense was $2,214,000 in 2012, $1,853,000 in 2011 and $1,654,000 in 2010. At December 31, 2012, future minimum operating lease rental obligations for the next five years and thereafter are as follows: 2013 - $2,354,000; 2014- $2,322,000; 2015 - $2,148,000; 2016 - $1,401,000; 2017 - $1,204,000 and thereafter – $2,850,000.