In a 4-0 vote (one council member was not present), Perry opted to move forward with Macquarie’s Milestone Two proposal for UTOPIA. This brings the final total of addresses participating to just shy of 53%. Each city who opted to get the full proposal will still need to vote to accept it once it’s completed. All UTOPIA pledging cities have had a chance to vote on the proposal before the June 27th deadline to respond.
I honestly did not expect this. Despite being one of the few cities with a near-complete network, Tremonton voted 5-0 last night to move forward with Milestone Two. This makes the tally so far four in favor (including Midvale, West Valley City, and Layton) and one against (Lindon). Votes are still scheduled in Orem, Centerville, and Murray. Payson and Brigham City have both been discussing it, but Perry has been pretty quiet.
If you live in a city that hasn’t voted, there’s still time to talk to them and urge them to move forward with Milestone Two. Check the list of events to get an idea of the when and where of what I know or contact your city directly.
UPDATE: Payson votes tonight at 6PM.
In a live news conference this morning, City Manager Wayne Pyle announced that the city is working on a partnership with Ooma to provide free phone service to every resident of West Valley City. Residents would be responsible for taxes and fees and there is also a charge to port an existing number. The city projects that the partnership would save residents around $20M per year in telecommunications costs. This service will ride on top of the completed UTOPIA network assuming that the city council accepts Macquarie’s offer when the Milestone Two report is complete. While this deal seems to apply only to West Valley City, it will be interesting to see if other UTOPIA cities try to get in on that action.
This only highlights the immense brand power of a ubiquitous fiber network in a city. It also gives Google Fiber a bit of a black eye since they have no phone product at all.
UPDATE: Here’s the press release.
Layton joins Midvale and West Valley City in voting yes to move forward with getting final details of Macquarie’s proposal under Milestone Two, the third city in a row to do so. For those keeping score, this means that all of the cities who have voted on the proposal have chosen to get more details. Given that there’s
no little commitment to do so, it’s a wonder any city isn’t interested in say “yes, please, give us the finalized details”.
The next scheduled votes won’t be until the final week to respond, so it’ll be really quiet. In the meantime, there’s a lot of public meetings you can drop in on to show your support. Also make sure that your city councils are hearing from you that they should move forward with Milestone Two.
In a unanimous vote, Midvale becomes the first UTOPIA city to choose to move forward with the proposal from Macquarie. Milestone Two will hammer out the fine details of the proposal to build, maintain, and operate the network for 30 years. The city will still need to vote to accept that finalized and detailed offer when it is completed.
Other cities are still taking feedback on the high-level overview presented in Milestone One. Murray will have an open house June 5 at 6:30PM. Centerville and Lindon both submitted detailed lists of questions and got public responses to all of them. This is shaping up to be an incredibly open process, a stark contrast to a UTOPIA that was scared to discuss anything in public for fear of being attacked again.
Keep your eyes open for postings about more upcoming votes and remember, the votes are just to move forward on getting fine details.
Macquarie has let their proposal out and it looks like they’re planning to make good on many of the rumored details. There’s also a number of very attractive points that will make this an easy sell for new cities to join. Some highlights:
- The network build will be done in existing pledging UTOPIA cities in 30 months.
- The fee will be $18-20 per month per
subscriber address with a 50% discount for MDUs and a 100% premium for businesses. This amount will be indexed.
- Utility fees will have a grace period of 6 months from construction to allow ISPs to hook people up.
- The free tier of service will be 3Mbps symmetrical with a 20GB monthly cap. All service providers must agree to offer it as a condition of being on the network.
- Cities stand to earn between $1.0B and $1.5B depending on the take rate. That’s 2-3 times the existing debt service. On the low end, it would drop the Macquarie fees by almost half. On the high end, it could almost entirely cover the Macquarie fee.
- Speaking of revenues, the cities stand to rake in another $100M annually when the network reverts to their control in 30 years.
- Macquarie will be aggressively promoting the network and intends to extend it to any city that wants to accept its terms. Cities without existing debt service may end up making a good bit of money on the deal.
The worst case scenario is that it is a wash with what they have now except the network gets completed and everyone gets free service. In the best case scenario (which I still this is a little too conservative), they end up paying almost nothing for the network. I’ll just come out at say it: any city council that doesn’t move forward on this deal is committing an act of deliberate and malicious fiscal malfeasance against their city and its citizens.
Macquarie has already presented this information in Utah County and will be presenting again Wednesday April 30 at 7PM at Layton City Hall and Thursday May 1 at 8PM at West Valley City Hall. Show up and make sure the cities know you want this deal to happen.
Without any official action, HB60 died in the same fashion as SB190 and was sent back to rules to rot out the rest of the session without so much as a committee hearing. Between these two bills, municipal broadband advocates in Utah have racked up some big wins when we’re used to nonsense punitive laws sailing through without any opposition. What changed this year was being on top of these bills and swiftly letting legislators know how we feel about them. It might not be a bad idea to write Rep. Curt Webb to express appreciation that he backed down on HB60 once we spoke up. I have a gut feeling that he was had.
And no, I’m not going to take credit for anything. Each of you who took the time to write legislators and share this information as widely as possible across social networks (Facebook, Twitter, Google+, Reddit, etc.) had at least as much of a hand in this success. I think we’ve proved that we’re a force to be reckoned with. We just have to show up.
While I think we’ve reached a point where the war is now going in our favor, it’s not over. I’m sure Comcast and CenturyLink will be more than happy to use their hatchetmen at the Utah Taxpayers Association yet again to try and throw up roadblocks next year. Sen. Valentine is not the type to go quietly into the night, and SB190 (or something like it) is probably going to be discussed in interim committees. I have little doubt that other restrictive measures will come up too. Once I find out about them, you’ll know too.
SB190 is no more. Sen. John Valentine made a motion to send SB190 to the rules committee to be studied in the interim which passed the Senate. This effectively ends consideration of SB190 this year, though it’s possible it may come up again next year. Short version: we win.
So what do we do now? Once the session is over, make sure you go to those interim meetings and write the committee members. I have no doubt that so many of you contacting legislators made a huge difference both in getting the bill amended and ultimately getting it shelved. Between this and HB60 appearing to rot on the vine, broadband advocates in Utah have scored major victories this year.
When I hear more about the movements on the committee and its proposals, I’ll be sure to pass them along.
I went to check the status of HB60 this morning and noticed the status has changed to “House Comm – Not Considered”. This means that the committee responsible for hearing the bill has declined to do so. Without a committee hearing, the bill has little chance of passing at all. There’s still the possibility that once the rules are suspended that it could be brought to a floor vote, but that appears to be unlikely and would be a “hail Mary” kind of move.
As always, I’m going to keep watching this one until the session is over, but it looks like we may have won this round handily.
On Thursday night, the city council in Brigham City voted to move forward on a predevelopment agreement with Macquarie. This is a positive step towards bringing $300M in investment to UTOPIA, completing the buildout in all member cities, and contributing money towards the UTOPIA bond payments. Unfortunately, the meeting wasn’t without theatrics and hysterics with plenty of incoherent rants and untruths during the public comment period. We even got a special Hitler reference from one of them.
You can watch the work session and city council meeting online (skip to 33:00 to begin public comment). The work session includes a very informative history of how private industry failed to build the infrastructure the city needed to keep businesses. Some quick facts from the work session and council meeting:
- In Brigham City, a total of 1600 people signed up for the SAA and about 1300 are current subscribers to the service, about 26% of the city.
- Brigham City is currently not contributing any payments towards UTOPIA’s operational shortfall of about $2.1M per year.
- UTOPIA’s revenues raised much faster when they started primarily targeting business customers.
- January’s income is much higher than expected.
- Anything beyond the current plan to slowly grow the network to profitability would be a much more expensive option. But we already knew that, didn’t we?
- Reissuing the bonds would be very expensive because of the way the current bonds are issued.
- The network will remain the property of the member cities. Macquarie is primarily interested in a return on their investment, not ownership. To break even, they’d need to bring in $10M per year over the life of the contract.
- Per Ken Sutton, owner of UTOPIA ISP Brigham,net, if the network doesn’t make a profit, Macquarie doesn’t get paid. Period.
- The woman who canceled the RUS loan to UTOPIA is now an executive at Frontier, the incumbent operator in Tremonton. Isn’t that special?
- Per their IT director, Box Elder School District depends on UTOPIA for 55% of students to get Internet access. They have no other fiber options available to them.
As expected, Ruth Jensen was combative for much of the work session, fitting her previous history of more-or-less unhinged opposition to UTOPIA. She even went so far as to propose suing UTOPIA, calling it “enslav[ing] the people”. The city attorney promptly smacked her down, saying that it would be the city effectively suing itself. (Skip to ~38:00 in the work session video to see it for yourself.)
So far, West Valley City, Layton, and Tremonton have also signed on. Centerville and Murray are considering it this week. Payson, as usual, is hoping that the whole thing will just go away and is ignoring anything UTOPIA-related. Word around the campfire is that all of the other cities want to move forward on a full study.