CHARLESTON, W.Va. -- About 2,300 West Virginians are expected to subscribe to high-speed Internet service for the first time, after a state board awarded $2.05 million to companies that plan to build wireless towers and serve new customers in rural areas.

The West Virginia Broadband Deployment Council had nearly $4 million to distribute Wednesday, but the governor-appointed group rejected the bulk of grant applications designed to expand broadband service into rural communities because Frontier Communications plans to provide high-speed Internet in many of those same areas -- without state subsidies. 

Wheeling-based StratusWave Communications was the big winner Wednesday, securing nearly $2 million in state funds for six wireless projects that will bring Internet service to rural areas in Ohio, Brooke, Marshall and Wetzel counties. Buckhannon-based 3WLogic received $57,528 to make wireless Internet service available in Newville, Braxton County.

"I'm pleased the Broadband Deployment Council was able to fulfill part of its mandate to give infrastructure grants out where people don't have broadband," council Chairman Dan O'Hanlon said after Wednesday's meeting. 

In a split vote, the Broadband Deployment Council rejected all "demand promotion" project proposals touted to encourage people to subscribe to broadband in rural areas in West Virginia.

Nonprofit groups had requested more than $1 million to increase customer subscriptions for high-speed Internet. West Virginia has one of the nation's lowest percentages of people who sign up for broadband where it's available.

"Demand promotion is critical," said LeeAnn Shreve, director of Future Generations, a Pendleton County nonprofit whose four grant applications were rejected Wednesday. "The take rate is low."

Board member Dana Waldo, who runs Frontier Communications' West Virginia office, pushed the council to award money to promote broadband in rural communities. Frontier had planned to partner with Future Generations on several projects.

"We have a lot of people who have [broadband] access who may not understand the value of access," Waldo said.

But several other Broadband Deployment Council members said state law allows the group to award grants to promote broadband only in areas where it's unavailable.  

"That doesn't make sense to me," O'Hanlon said. "I think the statute needs to be changed to allow the council to increase demand for broadband in areas that already have broadband."

Board member Jim Martin, president of Bridgeport-based Citynet, said the council should ask state legislators to change West Virginia's current definition of adequate Internet speeds to comply with federal guidelines, which recommend faster speeds.

After the change, more rural areas would qualify for state grants to build wireless towers or fiber-optic networks, Martin said, adding that such "infrastructure" projects should be funded over broadband demand projects. 

"If we had speeds updated, some of the projects today wouldn't have been rejected," he said.

Also Wednesday, council members voted to reject eight projects that would have built wireless towers or fiber networks in rural areas. Frontier already offered high-speed Internet in those areas or planned to bring broadband to those communities.

Other projects were too expensive and would expand broadband to 30 or fewer households, said council members who voted against the proposals.

State lawmakers established the Broadband Deployment Council and allocated grant funds to the group four years ago.

Wednesday marked the first time the council distributed any funds, other than to pay a Pennsylvania consultant to create maps of broadband coverage in West Virginia and to review grant applications. 

Council members haven't decided what to do with the $2 million in remaining funds. The council may ask for more grant applications next year.

Reach Eric Eyre at erice...@wvgazette.com or 304-348-4869.