MP (Dedicated Server) Offline?

Okay I tried to google this problem and couldn't find much and it was all last year.

Basically my internet is down, and I run a dedicated server using the dedicated server in the game path, launch the UI and then run the server as a service instead of a console, I tried just now to run it and it just keeps stopping, so I tried to start the service manually in services.msc and it says Error: 1067 - "The process terminated unexpectedly"

So I tired to run it in console to get a more verbose view of what is going on and I see this:

"Server connect failure: (No connection)"
"Error no IP assigned"
"Logging off steam"
"Shutting down server"

Also In game when you click join game it says "Steam is offline. Please run steam in normal mode, or restart steam if the problem persists"

I googled this too and apparently you can bypass this by using the steam UI server list, but I cant start the server to begin with anyways.

So the question I pose is do you require an internet connection even to play on a dedicated server on a LAN connection, because if so that is kinda sucky? can anyone elaborate on this?