Upcoming UTOPIA Legislation

As part of the last Government Competition and Privatization Subcommittee, proposed legislation regarding UTOPIA has been handed out. Needless to say, it's a Qwest dream come true designed to unduly restrict UTOPIA from expanding beyond the current membership. Since it's not available online yet, I'll transcribe it with some of my own thoughts. These are all amendments to the Municipal Cable Television and Public Telecommunications Services Act.

The first proposal is to restrict new non-pledging members.

Prohibit new non-pledging members. A municipality may not join an interlocal entity engaging in activities authorized by the Act without pledging sales and use tax revenues to secure bonds or other indebtedness of the interlocal entity.

This proposal seems to be designed to address a problem that doesn't exist. (That could be said of most of these proposals, but we'll discuss that later.) What I'm reading is that there is a concern that the non-pledging cities are somehow freeloading off of the pledging cities and putting them at risk without assuming any risk themselves. This belies a fundamental misunderstanding of how the project operates.

Non-pledging cities have chosen to take no financial risk. In exchange, they will only be built out if and when construction is complete within pledging cities and the project goes revenue-positive. In other words, pledging cities get nothing unless UTOPIA is meeting its operation and debt obligations. Given that, where's the need to protect anyone? I just don't see it.

The second proposal is to prohibit new members until the build-out in pledging cities is completed.

Prohibit adding a new member until "build-out" complete. An interlocal entity engaging in activities authorized by the Act is required to meet its obligation to provide infrastructure to current pledging members before the interlocal entity may add a new member.

• "Built out" would mean to have fiber optics available for use by every residential and business location in a pledging member municipality as contemplated on the day on which the municipality joins the interlocal entity.
• An interlocal entity may not provide services or infrastructure to an existing non-pledging member of an interlocal entity until the interlocal entity meets its obligations to pledging members.

The first problem is that this is trying to address something that will be a non-issue by the time the law goes into effect. UTOPIA is currently slated to complete their build-out to RUS cities by March of 2008 and to all pledging cities by mid-summer of 2008. What good does it do to have a law telling them they have to do what they've already done? I don't get it.

My second beef is that this law could be creatively interpreted to prohibit expansion of UTOPIA because of exclusive contracts already in place. For instance, many apartment, condo and townhome complexes have exclusive agreements for service with an existing provider and have opted to now allow construction of UTOPIA until those contracts expire. Would an inability to build in an area due to existing contracts constitute not being "built out" under this proposal? If that's the case, UTOPIA could be near-permanently prohibited from expansion.

Now we get to the third (and probably worst) provision.

Require vote by registered members to add a new member. A vote by the registered voters of all pledging members in an interlocal entity is required before the interlocal entity may add a new member.

• A vote on the ballot proposition would be allowed only at a regular general or municipal election.
• A municipality may be added only if the majority of voters in each municipality that is a pledging member of the interlocal entity at the time of the vote approves the addition of the municipality.
• The interlocal entity would notify the legislative body of each pledging member of the interlocal entity of the need for a vote.
• The legislative body of each municipality would determine if it wants to submit the ballot proposition to a vote of its citizens.
• Each addition of a municipality requires a separate vote, e.g. if three cities want to join at the same time, each would have a separate ballot proposition.
• The basic process for a local ballot proposition under Title 20A, Election Code, would be followed and statute would establish the format of the ballot proposition.
• Municipalities participating in the vote will not be able to recover the costs of the vote from the interlocal entity.

If you've gotten this far, the problems should be obvious. Basically, each member that wants to join requires unanimous approval of the majority of voters in every existing member city as well as the approval of the majority of the voters in the applicant city. What on earth is that? Why should residents of Murray vote on an issue for the residents of South Jordan? That makes no sense at all. My gut tells me it's a Qwest-proposed measure so that they can astroturf and snow job a single city into preventing all future expansion. Real nice, guys.

Unsurprisingly, I'm going to write up my objections and desired changes to this hideous proposal and submit it post haste to the members of the subcommittee prior to the next meeting on November 7. I'd encourage each of you to write the subcommittee members as well and voice your objections to these highly restrictive new terms.