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HomeMy WebLinkAbout07 18 2019 CM Study SessionCITY OF CHUBBUCK BROADBAND/FIBER Comm NTTY FORUM MINUTES JULY 18, 2019 — 6:OOPM LOCATED AT CHUBBUCK CITY HALL 5160 YELLOWSTONE AVE. CALL TO ORDER: Mayor England COUNCIL PRESENT: Roger Hernandez, and Annette Baumeister. STAFF MEMBERS PRESENT: Mayor Kevin England, Public Works Director Rodney Burch, Planning and Development Director Devin Hillam, Police Chief Bill Guiberson, City Clerk Joey Bowers, and Chubbuck Development Authority (CDA) Chairman Daniel Heiner The City of Chubbuck hosted a community forum for discussion among the vital players in the broadband marketplace; providers, vendors, industry experts, consultants, and local government officials. To share their perspective and help establish a framework for bringing Broadband/Fiber services to all of East Idaho. GENERAL BUSINESS: 1- Presentation by the City of Chubbuck Mayor England stated that 80% of Idaho cities are under 5,000 population, and 60% of those cities are under 1,000 population. Mayor England excused himself from the meeting at 6:30. Planning and Development Director Devin Hillam gave a background for this meeting, and presented the results from a community survey about broadband/fiber. 2- Presentation by the City of Amnon Technology Director Bruce Patterson represented the City of Ammon. Mr. Patterson stated that broadband is essential for cities to function; as such the City of Ammon decided to run fiber infrastructure as a municipal utility. The City of Ammon uses Local Improvement Districts (LID) to pay for the infrastructure to be built in the requested neighborhoods, which included the purchase of equipment and to hire personal. Through the use of these LID's the City has seen $4 million invested into fiber infrastructure, with no municipal debt, and only those residents that participate pay for the LID. Through this investment property owners have seen an increase in property value and a decrease in monthly expenses. Mr. Patterson stated that the City's fiber network is designed first to take care of the City's needs, second to take care of education and the School District needs, and third to meet the needs of individual property owners. Councilmember Baumeister asked how the residents are charged for their potion of the LID. Mr. Patterson stated that the State sets it as an annual bill that is sent directly to the property owner and is separate from their regular property tax bill. 3- Presentation by EntryPoint Robert Peterson represented EntryPoint Networks and gave a background on his experience. Mr. Peterson stated that EntryPoint provided the portal that the City of Ammon uses, and is currently using that model to sell across the country. Mr. Peterson felt like cities should own and control broadband infrastructure and should look at it as a utility that the city offers. Mr. Peterson also went over the cost savings that the residents of Ammon will have compared to other cities with private fiber infrastructure; and the affect that private infrastructure has on city right of ways and easements. Current service providers charge to bring their services to property owners as a non-recurring cost and then they charge a monthly recurring cost. Mr. Peterson stated that a LID is not a tax; it is a one-time fee that the consumer pays for over 20 years. 4- Presentation by FyberCom Jared Stowell represented FyberCom. FyberCom is a provider that got its start on Ammon fiber. Mr. Stowell stated that the City of Ammon's portal allows for less overhead on their company, which in turn allowed them to lower service costs to the residents. FyberCom only has to worry about bandwidth costs. Mr. Stowell felt like the Amnon model makes it possible for new companies to be able to compete and have a competitive product. Councilmember Baumeister asked what makes people choose one provider from another, now that everyone is using the same infrastructure. Mr. Stowell stated that it now puts pressure on companies to offer their best price and customer service. 5- Presentation by Direct Communications/TruFiber Nathan Brian represented Direct Communications and Brad McSpadden represented TruFiber. Direct Communications was the first company to provide fiber to homes in southeast Idaho, and high-speed intemet to rural areas of Idaho. Direct Communications built the fiber system that now connects all the City of Chubbuck properties. The investment that the City of Chubbuck has made is already paying off for its residents and businesses. Mr. Brian stated that Direct Communications had entered into a partnership with TruFiber to provide fiber connectivity to more homes in Chubbuck at a lower monthly cost. Their goal is to have fiber available to all Chubbuck residents in three years. Mr. Brian stated that with private infrastructure the capital costs are on the private company to hire employees, and to maintain/upgrade the network. There is no need for the City to hire more employees, to build the fiber, install services, and run the network. Mr. Brian also stated that eventually the LID's will end and the City will have to bare those cost with taxpayers dollars. Councilmember Hernandez asked who owns the network and who has access to this network. Mr. Brian stated that private networks are owned by the company that installed the network, and other companies would be responsible to install their own lines for equal competition. Councilmember Baumeister liked the simplicity of having one line versus multiple lines clogging up the City's right of way, the constant disruption to the residents during installation, and the impact on the City's infrastructure. But was also concerned if this was the City's responsibility to provide as a utility. 6- Presentation by Century Link Arleigh Smith represented Century link. Mr. Smith stated that Century link's current business plan is to focus on new/bare ground development and not existing neighborhoods to provide fiber services. Century link will only build where they can see a return on investment over a certain time period. The Ammon model is not a network that works for Century Link. Century Link has invested millions of dollars into the City of Chubbuck and will continue to do so. Century Link is the back bone that connects the local internet companies and their bandwidth to the rest of the world. Councilmember Hernandez wondered if the City should just let the market take care of its self, and only step in if a monopoly comes about. Councilmember Baumeister opened the meeting for public comment. Brett Hiltbrand asked how fast the City of Ammon could build their network, and if there was a kickback to those residents that signed up at the beginning when others choose to connect. Mr. Hiltbrand stated that one line controlled by the City makes true competition. Mr. Patterson stated that due to the state statutes that govern an LID, there is no kickback but those property owners that decide to sign up later pay the same LID amount as everyone else in that LID. It's best to get as many property owners signed up at the beginning to keep the LID amount as low as possible. The City of Ammon currently can pass about 300-500 homes a year during a building cycle. Ryan Misner felt like the cost of services the residents of Ammon pay and the LID cost are still a savings for the property owners compared to what the residents of Chubbuck pay. Mr. Misner also asked the Council if they had a time line for a decision. Councilmember Baumeister stated that the Council is still in the planning stages of the process. Jamie Fames stated that accountability and quality of service is more important than price. Mr. Fames was in favor of the Ammon model but would like cities to look at how to keep these companies accountable and not just focus on price. Jason Mendenhall stated that the upfront financial costs would not make sense. With all the current fiber that has been built and is currently being built; the City would be way behind to implement a network like Ammon. Mr. Mendenhall would not participate in an LID in his neighborhood. Mr. Patterson stated that the City of Arm -non currently has a 60% take rate in areas that have other fiber providers. Geri Hernandez asked about the disruption of private property during installation. Ms. Hernandez also stated that when she was a kid she remembered a city that had placed an LID on areas of that city to upgrade a sewer line. But when the city couldn't get enough residents to sign up the city went through and enforced the LID on the residents. Ms. Hernandez was concerned about this happening to maintain and develop fiber throughout the City of Chubbuck. Mr. Brian stated that Direct Communications follows the utility easements when installing fiber with as little disruption to the property owners as possible. Robert Peterson from EntryPoint recommend for the Council to look at the capital costs, management/operational costs, the cost for service, and how many fiber providers can the community support. Mr. Peterson stated that fiber is a 100 year infrastructure. Bruce Patterson from the City of Ammon stated that if all a city wants to do is drop the cost of internet for their residents, there is a lot of options. But if a city wants to prepare for the future and create a smart city it needs to have complete control of the infrastructure. AD.rouRN: Councilmember Annette Baumeister adjourned at 8:36. 1 y ers-City Clerk .r Al� Kevin England -Mayor