UTOPIA is seeking stimulus funding

Utah's municipal fiber-optic network hopes to almost double the number of homes it can reach by using funds from the American Recovery and Reinvestment Act of 2009.

UTOPIA, the Utah Telecommunications Open-Infrastructure Agency, has asked for more than $57 million to build midlevel connections into Wasatch Front neighborhoods. The request has been backed by Utah Gov. Gary Herbert, who sent a letter of recommendation with the UTOPIA request.

"We support the efforts of UTOPIA in seeking to extend (its) infrastructure to underserved areas of the state of Utah," the letter reads. "Based on (UTOPIA's) estimates, this funding will create 400 new direct jobs and extend network fiber to 358 anchor institutions."

If UTOPIA is awarded the cash, most of it will be used in West Valley City, Midvale, Murray, Layton and Centerville, said UTOPIA spokeswoman Elizabeth Vincent. UTOPIA hopes to become available to 40,000 new addresses; it currently reaches 45,000 homes.

The federal funds, if awarded, could not be used to repay the $189 million in refinanced sales-tax bonds, issued late last year. About $7.2 billion is available for telecommunications project nationwide.

UTOPIA is made up of 11 cities, 10 of which participated in the 2008 refinance.

The federal Rural Utility Service is among the organizations responsible for disseminating the stimulus cash. In 2008, several UTOPIA leaders said problems with that very service delayed fiber network rollout.

In addition to building infrastructure, the fiber-optic company would also use some money to launch an awareness campaign, Vincent said.

This year, Brigham City has been a focus of the struggling fiber-optic corporation. Earlier this month, the City Council agreed to a voluntary tax assessment for interested residents. Councilwoman Ruth Jensen cast the sole dissenting vote on creation of the special district.

The city intends to issue about $5.5 million in tax-free municipal bonds to help about 1,600 customers afford startup costs nearing $3,000.

Participating properties signed waivers that attach the fee to tax notices. The total cost per home won't exceed $25 per month, and interest won't exceed 8 percent, said Brigham City economic development director Paul Larsen.

The $3,000-per-customer fee the city collects will be used both for "shared access" costs to run the fiber through neighborhoods and "drop costs" to attach the line to homes, Larsen said.

Individuals have until Dec. 7 to sign up for the debt program. Thereafter, residents will have to pay startup fees in full or find their own financing, he said. The council will vote on exact bond parameters Dec. 10.

So far, Brigham City is the only UTOPIA city to use voluntary assessments to fund the steep startup fees.

"We feel like we have a great model, a great system for improving telecommunications and providing true broadband," Vincent said.

e-mail: rpalmer@desnews.com