UTOPIA wants more again

UTOPIA's leaders are working their way through the tax base of their 11 member cities. First, they got those cities to pledge a combined $503 million in sales taxes over 32 years to help fund the fiber-optic network (money they originally assured cities never actually would be tapped, but which has in fact been tapped for more than a year now). Now, they are asking for an additional $62 million in pledges, this time from utility franchise taxes.

Leaders of each of the 11 cities need to explain to their residents just how much tax revenue they intend to throw at the network in the hopes that someday it will turn a profit. And while some UTOPIA supporters continue to rail on Qwest, Comcast and other private-market providers of Internet services, they would do well to pause and consider the relative costs. The private providers may have their flaws, but they can't force people who aren't customers to pay. The use of their services is entirely voluntary. UTOPIA, on the other hand, is taking tax money that cities otherwise could use to provide services such as police and fire protection.

Even with that, UTOPIA has in some instances charged customers as much as $3,000 extra to connect the cable to their homes — money that can be financed over 20 years in exchange for placing a lien on the house.

UTOPIA stands for Utah Telecommunications Open Infrastructure Agency. It was formed in 2002 under the philosophy that a fiber-optic network ought to be considered a public utility — one that any provider of Internet, television or telephone services could use for a fee. Participating cities were promised that subscription fees would cover construction costs. However, sales have lagged. Fewer than 8,000 homes and businesses currently receive service over the network.

The new plan is for a new organization, the Utah Infrastructure Agency, to market and finish developing the network. It is this entity that would receive the $62 million in new debt over the next five years. It would focus on areas that promise the most growth, rather than trying to blanket each city with fiber-optic cable.

A few cities held public hearings on this request this week. However, a new feasibility study of the plan had barely been finished, and as of Tuesday the spreadsheets and technical data used to draw the report's conclusions were not being made available to the public. Given the importance of this funding request to the future of city coffers, we can't imagine why any city would move ahead without making sure its residents had been fully informed and had a chance to react.

We also can't imagine why those cities would be anything other than highly skeptical. The new UIA is projecting seven more years of losses before turning a profit in 2018. When private companies lose, their own wallets take a hit. Customers who are affected can find a new provider. When public projects fail, all taxpayers lose, and they have little recourse other than the ballot box.