Ann Arbor-based nonprofit Merit Network Inc. has received a $33.3 million government grant to extend broadband Internet access to areas throughout Michigan’s Lower Peninsula.

The U.S. Department of Commerce’s National Telecommunications and Information Administration awarded the grant to Merit through the federal economic stimulus package, officials said.

Merit plans to use the grant, in addition to $8.3 million in matching funds, to construct a 955-mile advanced fiber-optic network that will reach 44 rural “anchor institutions" in 32 Michigan counties.

The network is aimed at providing improved Internet access to buildings like schools, colleges, libraries and health facilities, where community members frequently access the Internet.

But Merit is also partnering with four Internet service providers to help improve their ability to provide broadband access to residents and businesses.

Merit CEO Don Welch said the nonprofit, which employs about 70 workers in Ann Arbor, plans to hire several employees to manage the network expansion. He said improved broadband access is critical to economic development.

"We’re not going to solve the unemployment problem in Michigan by ourselves but we hope by providing this broadband Internet access we’ll contribute to solving the economic crisis throughout the state," Welch said.

Merit is a 44-year-old nonprofit whose core objective is to broaden high-speed Internet access and connect educators, researchers and community members.

Merit officials plan to begin construction on the network -- officially called REACH-3MC (Rural, Education, Anchor, Community and Healthcare - Michigan Middle Mile Collaborative) -- in May. The grant covers 80 percent of the project's $41.6 million cost.

The network, which will be built out within 3 years, will enhance connectivity speed and lower Internet costs for Merit's network users.

Welch said it's important to invest in the fiber-optic network because it will enable communities to response quickly to increased connectivity demands in the future.

"Whatever is required 10 years from now, it’ll be cost effective to" add connectivity due to the network investment, Welch said.

Ana Preston, executive director of member relations and communications for Internet2, which works with Merit, said the stimulus funding would boost the economy.

It "will vastly improve access to advanced networking capabilities throughout the state of Michigan," Preston said in an e-mailed statement. "Providing these resources to key community anchor institutions throughout the state, we believe, will result in new breakthroughs in research, improve education and healthcare and -- most importantly -- help to create jobs."

Regarding Internet2 proposals, Internet2 is studying the second Notice of Funding Availability that came out last Friday from NTIA and considering submitting an infrastructure proposal for this second, and final, round of broadband stimulus funding.

Regarding the Internet2/Merit relationship - Merit is a "research and education network member" of Internet2, they are also a Network Connector which means that they connect the research and education community in Michigan to the national Internet2 Network. Merit also connects the OARnet Network (Ohio's research and education network) to the Internet2 Network.

The $787 billion American Recovery and Reinvestment Act included $7.2 billion to advance broadband Internet access throughout the country. The government is staging a gradual rollout of its broadband stimulus package announcements. Merit’s award was one of four projects awarded $63 million in funds today.

The NTIA, which is distributing $4.7 billion of the funds, received some 1,800 applications for funds. The agency has awarded just $200 million of its stimulus funds so far.

Government officials hope that extending high-speed Internet access throughout the U.S. - which generally lags much the rest of the industrial world in broadband penetration - will create jobs and spur economic development.

"High-speed Internet access is the lifeblood of today’s economy," U.S. Commerce Secretary Gary Locke said in a statement. "Having access to the Internet’s economic, health and educational benefits should be as much of a fundamental American right as attending a quality school.

"Our best minds should be able to talk to one another, create and innovate regardless of where they come from. These grants are an important step toward expanding high-speed Internet access into the unserved and underserved areas of the country."

Merit’s funding is coming from NTIA’s Broadband Technology Opportunities Program.

An unrelated broadband stimulus application by Wireless Washtenaw seeks funding from the U.S. Department of Agriculture's Rural Utility Service, which is distributing $2.5 billion in funds.

Wireless Washtenaw is seeking $4 million in grants and loans to continue the construction of a wireless Internet network that would cover the entire 720-square-mile county. The application, filed on behalf of the program by Wireless Washtenaw contractor 20/20 Communications, is still pending.

Contact AnnArbor.com’s Nathan Bomey at (734) 623-2587 or nathanbomey@annarbor.com. You can also follow him on Twitter.