UTOPIA dream turning into nightmare

The dream of UTOPIA lives. Unfortunately, the cost to finance the dream has indentured Wasatch municipalities for 20 years by holding hostage millions of dollars of pledged sales-tax revenues.

Recently, UTOPIA has asked Centerville to extend the sales-tax pledge to 33 years. Under the new pledge, the city will be liable for a sales-tax pledge ranging from $389,000 to $730,000 a year, for 33 years. Clear language is written into the agreement describing creditor foreclosure procedures — in essence, a mortgage on the city — should the city not meet its sales-tax pledge commitment. The prospects are frightening, and with the new 33-year commitment, it would be impossible to foresee the impact on the quality of city life and the potential for catastrophic circumstances should the city fail to meet its pledge obligations. Sounds like an ARM mortgage doesn't it? Similar pledges are being considered by the other 10 UTOPIA communities.

The dream has also fallen victim to a possible mismanagement of funds of up to $130 million, made available since the 2004 sales-tax pledge agreement. Yes, there have been limited successes, but the lack of responsible corporate governance and the appearance of gross negligence and possible willful misconduct by executives have raised serious questions about its ability to carry out the vision, mission and strategy that initially created it.

City councils are also wrestling with UTOPIA's marketing strategy that requires subscribers to pay an upfront connection fee ranging from $1,200 to $3,500. The plan also requires that 40 percent to 60 percent of neighborhoods sharing the same cable bundle of fiber optics sign up for service. Although UTOPIA officials cite sound business practices, they are referring to European practices that are unproven in the U.S. or more specifically, Utah markets.