Conversation to Transformation

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You're listening to locally produced programming created in

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KUNV Studios on public radio. KUNV 91.5. The content of this program does not reflect the views or opinions of 91.5 Jazz and More, the University of Nevada Las Vegas, or the Board of Regents of the Nevada System of Higher Education. Introduction of COVID into our society helped make more clear than ever before the importance

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of connectivity.

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You can systemize this whole thing.

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No one, no one is better.

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I guess maybe it was the intensity of fear and uncertainty that somehow simultaneously and magically magnified the intensity of compassion and innovation.

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Welcome everyone to another episode of Conversation to Transformation. I'm here with my colleague Dr. Kelly-Ann Beavers from Brookings Mountain West and the Lindsay Institute and we've invited as a guest today President of the Broadband Group, Jeff Ryman. Jeff, thank you so much for coming all the way out

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here to talk to us today.

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Yeah, thanks for having me. Jeff Ryman, President of the Broadband Group. We are a telecommunications consultant and advisory firm. I think it's the appropriate way to define us, but really at our core, we position ourselves as an education firm. We work with developers of large scale master plan communities. Picture the Howard Hughes Corporation when they were developing Summerland, and it was all just open desert. And as a master plan community by definition, the Howard Hughes Corporation was master planning every component of that development community except for often connectivity. What do they do? They pick up the phone, they call Cox Communications, they call CenturyLink or whoever the incumbent phone and cable companies might be in their area, and tell them to come do whatever it is that you do, just come and get people connected. And there's really two reasons for that. One is that they see it as technology and technology moves quickly. Developers and master plan communities are looking at 5, 10, 15, 20 year time horizons. When thinking about technology, it seems to evolve every one or two years. By the time a technology is identified and implemented, it's already seemingly obsolete. The other reason why it's often not part of the core planning element is that it's just often outside the area of expertise of the development community. These are titans of their industry, leaders in developing world-class projects like Summerlin, but connectivity, again, is just outside their area of focus. So they allow the service providers to come in, build networks that meet their investment thesis, and not really necessarily networks that meet the expectations of the residents and businesses of that community. And that's to the detriment of both the community as well as to the service providers, because they don't necessarily have a plan of how they can deploy infrastructure more efficiently, saving capital costs, and potentially attracting more revenue. That's been the core focus of the broadband group for over 25 years. As the importance of connectivity has become more clear at a larger scale, municipalities and electric utilities have recognized that they, too, need to take control of their connectivity future and can't sit back and wait nor should they sit back and wait for it to meet the investment thesis of a service provider to make the type of infrastructure investments that the residents and their businesses require especially in the remote world which we now all exist. Yeah you can't leave it up to anyone else, right?

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I mean, those sound like great opportunities for partnerships. So a lot of developers are focusing on getting electrical or roads. Broadband connectivity is now an element of urban planning?

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It is absolutely an element of urban planning. The Urban Land Institute recently published a paper calling it a cornerstone of the land development process, where my father, the founder, my late father, the founder of the Broadband Group, who 27 years ago founded the Broadband Group when very few people knew what broadband was and especially appreciated what broadband can do. And I use the analogy he used to walk the halls of the Urban Land Institute talking about the importance of connectivity and land development. He was ahead of his time. You know, when you are talking about something that no one else is, you're either a little bit out of your mind or you're a true visionary. It proved to be a true visionary in that regard because again, it's not that Cox Cable or CenturyLink to use the example here in Las Vegas that they're doing anything purposely to not meet the expectations. They're just not having that alignment to make those investments more efficient and more relevant to the residents and to the businesses.

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I do want to respond to some of what you were articulating about the niche knowledge that a service provider has and your role in helping inform a developer or a municipality about how they themselves can think critically And sort of, I guess the other side of the coin in that same picture is that, to your point, the service providers aren't necessarily intentionally doing anything detrimental and not planning in that purposeful of a way to serve each community member's needs. It's an expertise as well. Urban planning and land development is an expertise that doesn't necessarily lie with the service providers. So as someone, my background is in urban planning, so I've always found what you're doing particularly fascinating. And I remember the early conversations of a smart city and when those sort of lingo in urban planning arose and became more commonplace, and it was real creative and far-out forward-thinking for urban planning to talk about that aspect. And now, to your point, it's a necessity. It's a foundation of urban planning and real estate development as well. So I wonder if there are also, and I'm sure the answer is yes, but if you could speak a bit about how the service providers are learning from this as well, about kind of that aspect of the expertise?

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Well, I think one thing talking about the pandemic that made very clear was the importance of connectivity. If there was one thing that held the entire economy together, it was access to high-performance connectivity, and that's healthcare, that's education, that's commerce, that's social. Of course, that's only for those who actually had access to it. And what the pandemic made very clear was the digital divide and the underinvestment in many areas throughout Las Vegas, throughout many urban markets. And forget about the urban markets. What about the tier two cities? And then the rural markets? And then the remote markets? It made it very clear that there's just not enough capital by way of these private service the connectivity needs in a situation where students are asked to stay up-to-date with their coursework but oh by the way you can't follow along with your teacher the way other of your classmates can or the quality is so lousy my goodness it's hard enough for us to sit through a zoom meeting at our professional age. Imagine as a young teenager or a, you know, even younger and told to stare at this screen and it's buffering. You can't do it.

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Yeah, and that's made it a lot more at the forefront of anyone's average conversation, right? It's a part of children's education and a part of young people's everyday experience now and more so was at the height of the pandemic. So that's allowed people to think even more critically about it as a part of everyday life.

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And that's what has transitioned the attention of the development community, recognizing that's a core planning element, but especially at the municipal and the state and even national leadership levels. We have to be proactive in addressing the digital divide, or what is often referred to as the homework gap. to allow for equitable access to the services that citizens and residents need, access to education, access to healthcare, the ability to stay part of the virtual job market because of the connectivity that is put in place. So how do we become proactive as municipal leaders, going beyond developers and master plan communities? How do we understand where the gaps are? And then what are the opportunities for us to fill in those gaps? You know, there's a thesis that was put out by a gentleman named Blair Levin, who is with Brookings, non-resident senior fellow of Metro Brookings. He was a lead author of the FCC's National Broadband Plan. Truly one of the great minds in the telecommunications industry. And he talks about changing the math on traditional network build economics, how do we lower capital costs for service providers or for cities to make strategic investments, increase visible revenues? Because as it stands now, under the current math, the cost of deploying advanced broadband infrastructure is higher than the benefits that can be received. So how can we effectively change the math, encourage investments in infrastructure that is needed in ways it would not or could not occur on its own. And that's what we're working towards. Every community is working towards across the country.

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When you say the cost to extend it is higher than the benefits, do I understand you correctly to be saying that the cost to make broadband happen costs more than the potential that someone might have given the current math to make any money on extending that service?

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Certainly on the private side, the revenues just aren't there and the costs of deploying are high and what's often overlooked, the operating costs are high, which is why we see so much federal monies coming down the pipeline, which is excellent. Here in Nevada, Brian Mitchell, who runs the Nevada Broadband Office, will be receiving here as the state as part of the BEED program of the bipartisan infrastructure plan, broadband equity access and deployment plan, well over a billion dollars that's going to be deployed throughout the state of Nevada to address this digital divide. But it's going to be up to the localities to put together a plan to go to Brian Mitchell's office and saying here is going to be the best use of capital with that billion, billion and a half amount of monies that's coming to the state. And obviously a billion and a billion and a half dollars is a huge amount of money. But let me put it in perspective. At the broadband group, we're building out the city of Colorado Springs, Colorado. That city in and of itself, 220,000 homes will be connecting, almost $600 million, one city. So when we think about the cost of deploying infrastructure, it needs to be deployed efficiently in a way in which it's going to last with the fiber infrastructure. That's going to last decades. I talked about the hesitation of wanting to lean in on technology because technology moves too quickly. What I tell developers, what I tell city leaders is fiber optic infrastructure, high quality broadband infrastructure is not about technology de jure. It is about putting a foundation in place for whatever technology comes down the road, your city, your residents, your businesses will be able to benefit from it. We talk about smart cities. Well, what's a smart city? What's a smart city technology that I really need to be adopting? It seems like everybody's talking smart city and I'm a municipal leader and I feel behind and it's a language that I don't understand. First of all, take a step back, take a deep breath. You're not behind. The folks promoting smart city technologies, candidly, are the vendors trying to sell you the equipment. At the Broadband Group, my late father used to always say, technology can push, but the market must pull. And ultimately, that service, that application, will evolve. That will bring great benefits to the way in which your city operates, the way in which your residents live, the way in which your businesses work. But what you want to focus in on, not what that technology may or may not be, but a platform for communication so whatever technology comes down the pipeline, your residents and businesses will be able to benefit from.

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So Jeff, if I'm a city leader and I want to create incentive in this space in order to create public-private partnerships with, you write, the incumbent providers, as you mentioned, how do I go about that? Do I call up the broadband group and I ask you for a map of what broadband access looks like? Do I ask you for, I don't know, a feasibility report, an impact report? Which steps do I have to take as a city leader?

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As a city leader, the first thing you want to do is understand what are your real needs and creating that support within the city itself. We sit down with every department and we talk about how are you utilizing connectivity today and where are the gaps, how would you benefit by having improved connectivity in place and that's sitting down with police, that's sitting down with fire, that is sitting down with traffic, that is sitting down with all the various departments so they all realize that we're going to benefit from this improved investment in connectivity. Then how do we fill in those gaps as a city, what strategic investments might we make, and how might we identify a provider, a service provider that has the balance sheet to be able to have the operational and financial wherewithal to maintain what it is that the city is expecting and what that service provider is promising to do. How do we identify a qualified provider or better align with the incumbents and saying, look incumbent service providers, we need this connectivity. We're gonna make the investment on our own. We're gonna find a qualified competitor, or hopefully you'll be able to step up and make those investments that will make our needs. And by the way, we've identified all these use cases, so that revenue which you didn't currently have on your books, now you're going to be able to actually get more revenue, making that investment pencil out. Oftentimes, it still doesn't work, which is why we have the grant monies coming in, filling in those gaps, and then being able to make that infrastructure investment achievable.

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That sounds like really good news, right? And I'm curious to know how... Okay, there's a discussion about what options we have with regard to service providers, right? There's the usual big names, and sometimes that's problematic. Of course, they're not trying to be problematic. They just have a lot of demand, like you said. So I'm curious, how would we ask them, keeping all of this in mind, keeping all of this good news in mind, to expand into areas where those opportunities are not necessarily available, right? In urban planning and urban studies, we look at the urban rural divide a lot, right, with regards to other infrastructure issues, but recently there's been an emergence of disparities within urban spaces.

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Can you talk a little bit about that?

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Yeah, you know, oftentimes when talking about the digital divide, it's looking at rural America and rural Nevada. It's obviously very important. There's so many rural areas throughout the state. But in terms of population, in terms of number of residents and businesses, the digital divide is in the urban markets. So how do we identify those needs and then identify qualified providers? And I don't mean to scare any of the city leaders that are looking for qualified providers, but often the most interested are going to be the least qualified. Because the ones that are really qualified know the challenges and they're not just going to raise their hand and say, hey, we'll meet all of your needs. Let us get access to your right of way. Give us the contracts to take over your city needs and we'll be your new service provider. These incumbents, they're lousy. No one likes them. That's not often the right case. We want to put together a plan that respects the metrics of the broadband industry, respects the metrics of the broadband industry, the costs that are needed with trying to achieve revenues that will allow them to make sustainable. Either fiber is the gold standard, fiber is the gold standard, or maybe a wireless connection that would be at least a near-term fix before that fiber can be connected all the way to the end users.

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Yeah, there was a lot of investment in

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temporary Wi-Fi erections during the pandemic, right?

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So we talk about fiber, and everyone says, gee whiz, broadband group. You're talking all about these wires and the cost of deploying them, these wire infrastructures. We're living in an increasingly wireless world. You sound like a bunch of dinosaurs. What gives? Here's a very important component of wireless infrastructure. Wireless infrastructure is wireless for a very small component of the total network. The more fiber you have in your network, the higher quality wireless signal you're going to be able to achieve. It's just like in your home. You have your Wi-Fi. Everybody loves Wi-Fi, but you still need that Ethernet cable plugging into that Wi-Fi router to then distribute the wireless signal. And the higher the quality signal that's the higher quality wireless signal that's achieved around your home. It's the same thing with outdoor coverage. When we talk about 5G, 5G, a great wireless medium, heavily dependent on robust fiber optic infrastructure. 5G signal, very fast data speeds, very fast bandwidth, but the distance it can travel, much shorter than over legacy 3G and 4G standards, which means you need your antennas, your towers closer to your end users, which means you need more fiber closer to your end users plugging into those towers so that can distribute that high quality wireless signal. Wireless, brilliant, 100% dependent on fiber infrastructure feeding those antennas.

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Yeah, so these are not mutually exclusive technologies and thank you for clarifying that because on some hand I think many people understand that but it is easy to get lost in the, you know, deep expertise required to really understand the subtleties of these technologies and how fast they're evolving and that is something that was coming to mind as you were talking about the access to right-of-ways and the aspects that are required potentially for a service provider to work with a municipality, and that is something that I hadn't thought deeply about, which is the length of the long-term relationship that a municipality or a developer is building with a service provider if they do endeavor to pursue a large-scale project or extend service to an area that potentially didn't have it previously and I wonder if it is a part of what you're able to help alleviate or help folks navigate is understanding the nuances of the different service providers and like who might best serve the longevity of their relationships there. And no matter who the service

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provider is there are steps that cities, localities can take to encourage investment simply by making infrastructure investment more efficient. What are your permit processes? Is it friendly to investments by competitive broadband infrastructure providers? What are right-of-way fees that you might have currently in place? Why is nobody investing? Why is nobody investing? Well, because we're trying to construct there, but the permitting process that is in place makes it very challenging for the construction crews. And like all industries, it's hard to find construction resources these days. And those construction resources are going to go to the areas where they can build the fastest.

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So it's parcel by parcel. Is that partly what you're saying? That if the permit is parcel by parcel, then it's going to take the rest of your life.

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That's exactly right.

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Or is it? No. I mean, and I'm sure there's also interior red tape in departments that makes permits take a long time, but I, the amount that I know about permits makes me think, wow, if it had to be parcel by parcel, then I'll be dead before it's ever done.

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That's exactly right. But obviously safety is paramount and a lot of permitting is, of course, but it goes without saying. Safety is paramount. So obviously there's reasons why permitting is in place. You don't want to completely disrupt the aesthetics of a community and having people just come in and placing infrastructure because that infrastructure is never gonna be the same. And it's a good way to have a really unhappy citizenry by having destroyed land improvements. So we do certainly want to control how infrastructure is placed, but doing an examination. Is the policies that we have in place appropriately balanced between protecting what's important but also encouraging

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investment? Yeah, it seems like what you do would be easier to do in some parts of the country than others, and I know that's probably an obvious statement, but I like having grown up in Texas, somewhere where there is a lot more land to be developed than there are in other parts of the country such as Nevada, I could see how thinking through the logistics of having your right-of-way readied is a completely different thing than somewhere where a lot of the urban area is built out or nearing built out. And do you want to talk at all about that? I think it's fascinating.

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Well, I mean, I think we mentioned it there. So again, the capital is limited, especially on the private side. That capital is going to get deployed where they'll be able to build the fastest, to get the revenue as soon as they can get it. It's an industry of scale. The longer it takes to build the infrastructure, the longer it takes to get the revenue, the longer it takes to get the revenue, the more your debt payments start piling up, and that's when you start hitting into financial challenges. So allowing networks to get built quickly is of paramount importance.

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Could you tell us some success stories? I know you've worked with cities all over the country. So granted, it hasn't happened here in Vegas for us quite yet, listeners,

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but could you tell us about what that looks like?

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I think the most important two builds in the country are Huntsville, Alabama and Springfield, Missouri.

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Okay, what was so great about that?

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In Huntsville, Alabama, the electric utility was building out infrastructure for their own internal operational needs. And every electric utility in the country is doing that currently. They need more fiber optic infrastructure in their networks to better manage the grid, to bring on distributed energy resources. These grids are no longer just pushing energy to the homes and businesses, but those homes and businesses may also be generating energy because of the solar panels on top of the roofs, meaning that energy is flowing on two directions on the grid. What is a smart grid? What is grid modernization? What is grid of the future? Candidly, that's beyond my purview in the specifics, but what it is, is technologies which allow for the grid to be better managed. Those technologies best communicate when there's fiber optic infrastructure within the network. So Huntsville Utilities, the city-owned electric utility, came to the Broadband Group and said we're building fiber for our own internal needs. At the same time the mayor of Huntsville, Alabama, Tommy Battle, raised his hand and said we want to be a gig city. This is when Google Fiber first really came to market in the 2014-2015 time frame. And like many mayors made a proclamation but didn't really have a clear road map of how we were going to become a gig city.

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That's where the broadband group comes in.

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Well, the utility called us and said, is there a way we can make investments that meet our internal operational needs but perhaps also advance the connectivity goals of Mayor Battle and what our residents and businesses expect? So we worked with the utility, designed a network that first and foremost met their internal operational needs with excess capacity that could be then made available to a service provider to lease access on that same network and then be responsible for delivering high-quality broadband services to the residents and businesses. Essentially the utility built railroad tracks for itself with an extra railroad track for a service provider. Oh I love it. It really does start with power. With providing competitive services.

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Utilities serving utilities.

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The barrier of entry is why we don't see competition in our markets. Huntsville, Alabama, $110 million to build out that fiber optic infrastructure. So you look at a service provider coming in, having spent $110 million before they get their first $99 subscriber. The math just doesn't work. If there's a way in which you can use infrastructure that can be used for multiple purposes, changing the math on traditional network build economics, Google Fiber came in, competed head to head with Comcast and AT&T, and the city of Huntsville has been beneficiary for all those reasons. Springfield, Missouri, the second market where that deployment was achieved. CenturyLink, now Lumen, is the anchor tenant on the electric utilities fiber optic infrastructure, providing high-performance connectivity citywide. Those are areas in which they were creative about how they were deploying their infrastructure, turned a cost center for the utility into a revenue generating asset, and advanced the connectivity capabilities forever in those areas.

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So in Nevada, we're starting to see investment by tech companies more and more, right, especially northern Nevada. So it sounds like we're at the precipice of what could be a similar story here in Southern Nevada, right Jeff?

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We absolutely are. And there's great demand, but then again, understanding what is the appropriate medium for each region. You talked about there's some confusion about whether it's fiber, is it wireless, is it 5G? It was about a year and nothing's really changed. But here's the thing that most people don't recognize. When 4G was introduced, it came with that same level of publicity by the wireless service providers. And then 4G was introduced to the market. This was about 12 years ago. And guess what happened? Nothing changed. Until it did. About five or six years when we had 4G in our areas and a little company called Uber came along and transformed the way we just about operate everything that we do, introduced the gig economy and these fancy computers that we carry in our pockets by way of our mobile devices allowed us to change the way in which we shop, the way in which we mobilize around our areas and that's what you have to think about, when why do we need fiber optic infrastructure today? What is that technology that I need today that I can't get? Well, it's not about today. What is 5G providing today that I didn't have yesterday before it came along? That's not the question. What we want to focus in on is get that high performance connectivity foundation in. So again, whatever that next Uber invention that comes along, that the state of Nevada, the city of Las Vegas, and all the other areas throughout Nevada will be able to benefit from it.

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This really does affect all of us and therefore it's within our interest to combine an approach to all of that technology, right? Whether it's energy, solar in the case of Nevada, right, if we have that capacity, and it happening at the same time as broadband access. Jeff, thank you so much.

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If there's anything else you'd like to say here on the podcast, we welcome you.

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The only thing I'd like to add is I'll go back to 1986, the industry's first fiber-of-the-home project. It was championed by a gentleman named Gino Pellucci, a well-known business person who was building a new community in Central Florida. And he wasn't a futurist, and he wasn't a technologist, but he led plans for the deployment of the first fiber optic network. And what he said is, I don't know the first thing about fiber optic technology, but I know what people need. And the most important thing we do is communicate. And that's why we're all here. It's social, it's health care, it's education, it's commerce. High performance connectivity is what drives the way in which our cities are going to be able to

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thrive. Thank you, Jeff. Thank you for tuning into this episode of Conversation to Transformation, Opportunities Born from the Pandemic. This podcast is made possible through the Lindsay Institute at the University of Nevada, Las Vegas. For more information, please follow us on social media and visit our website at www.unlv.edu For more information, please follow us on social media and visit our website at www.unlv.edu

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lindsayinstitute.org