10 of 11 cities OK $181 million UTOPIA refinance

MURRAY — Given the nod from 10 of 11 cities, UTOPIA will charge forward with a $181 million refinance that will allow it to cut old ties, finish build-out and repay contractor debts.

The refinance adds about $60 million and 13 years to bonding backed by sales-tax pledges from the 11 cities. If all the tax pledges were called upon, taxpayers could spend half a billion dollars on the project.

Payson, the lone dissenter, will be asked to pay on its sales-tax pledge at the discretion of the UTOPIA board, which is made up of representatives from each city.

The affirmative votes of Centerville and Brigham City, contingent upon Murray's vote, were cemented Tuesday.

Murray voted 4-1 to move forward, with Pat Griffiths dissenting. She also voted against the original tax pledges in 2004.

Within a month, the Utah Telecommunication Open Infrastructure Agency expects to have the capital to continue building fiber rings in pledging cities. It will also be able to complete infrastructure in rural cities where build-out is all but complete, said Melissa Johnson, who handles public relations for the municipal utility.

When the rings are complete, customers can go through retail providers to get services such as Internet, video-on-demand and digital telephone. Fiber will bring lightning-fast upload and download speeds. It will also allow for huge electronic file transfers that have been impossible on some connections.

UTOPIA has refused to answer specific questions about how build-out will occur and about proposed connection fees. Johnson said Tuesday some of the details hadn't been decided and others are being kept secret for proprietary reasons. "There are definitive things we are working on," said Todd Marriott, a Colorado-based advisor to UTOPIA. "This is not hyperbole or hot air."

The more customers sign up, the more construction capital UTOPIA will have to work with, Johnson said.

Utah's experiment in providing municipal fiber optics kicked off in 2004 amid heated arguments regarding funding, technology and government competition. The arguments continued in the blogosphere and news editorial pages as UTOPIA ran into roadblock after roadblock.

The utility, governed by interlocal agreements, fell far short of projections. Its leadership argues that the plan ran into unforeseen challenges, including a faulty loan from the federal government through the Rural Utility Service. Leadership also admits to mistakes such as failing to hire telecommunications experts, failing to communicate with elected officials and relying too heavily on retailers.

UTOPIA will be issuing monthly reports to elected officials in affected cities, general counsel Dave Shaw told the Murray City Council.

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