Last Spring, the City passed a resolution in support of Hiawatha Broadband (HBC) applying for stimulus funds for a fiber build out. That resolution contemplated the City having an ownership stake in the project which would be spelled out in a Memorandum of Understanding. Many questions remain.
Has the City entered into a Memorandum of Understanding with HBC? If not, why not?
What ownership stake does the City contemplate with HBC in this fiber project?
Will the City actually own any of the fiber, or will it simply be a minority stakeholder in the project?
If it owns any fiber capacity, will it be able to sell it or lease it to commercial users?
Specifically, to what extent is residential fiber for Red Wing part of HBC’s second round application?
What is the City of Red Wing’s plan for residential fiber in the event HBC does not receive second round funding?
As things now stand, second round stimulus awards might not occur until Sept. 30, 2010. Should the City wait to see what happens, or should it be ready to act, regardless of funding?
I believe the City should be prepared to act in September. Here’s why:
• Municipal bond rates remain at historic lows.
• Construction bids continue to be very favorable.
• Seasonality of Construction.
• Unnecessary delays could result in significant costs increases.
The City council needs to act soon. The City needs to determine what form of governance it will use to oversee its ownership interest in the fiber project. An advisory commission, such as what Monticello uses that reports to the Council, or some other form. But this political decision should not wait until September.
The City also needs to know the costs of a residential fiber build out, with or without, stimulus funds.
The City does not need at this point to commit to a residential fiber build-out, but it must commit to be prepared to make that decision.
The political calendar must not drive the decision-making process. Too much is at stake. Leadership is required now. The City Council must not squander the opportunity for the citizens and businesses to have affordable, high speed internet access.