In our opinion: Time to end UTOPIA: Enough taxpayer money has been wasted on money-losing effort

Published: Friday, Aug. 3 2012 12:00 a.m. MDT

Technicians Chris Adams, left, and Josh Kester work Wednesday in the Network Operations Center of UTOPIA.

Scott G Winterton, File, Deseret News

Enlarge photo»

Sir Thomas More first created the name "Utopia" as the label for a fictional island in the Atlantic Ocean. Translated from Greek, it means, literally, "no place." Ironically, that's exactly where the Utah Telecommunication Open Infrastructure Agency (UTOPIA) finds itself, 10 years and hundreds of millions of dollars after it was first proposed.

A recent legislative audit concludes that the UTOPIA project has squandered a great deal of the money that they raised in bond proceeds, with over 40 percent of the bond funds being used to cover operating deficits and debt service. That wasn't how the money was supposed to be used, but, then again, not much about UTOPIA has gone according to plan.

Early projections presumed that UTOPIA's massive broadband network would be profitable within its first five years and have a subscriber base of 49,000 by 2007. Yet as of April 2012, it has a paltry 9,300 subscribers, and profitability is nowhere in sight.

This is causing an impossible strain on the local municipalities that pooled their resources to make UTOPIA possible. The participating member cities have to scrounge up $13 million a year in sales tax revenues to keep UTOPIA going. Adverse economic conditions make that money a lot harder to come by than it was when the project was on the drawing board. Clearly, there are far more important civic priorities that ought to take precedence over the UTOPIA boondoggle. This constitutes an inexcusable waste of valuable public resources.

UTOPIA's network duplicates more innovative projects taking place in the private sector. The free market recognizes the need for a robust communications infrastructure, and it has been able to provide customers with these services in a timely and cost-effective manner. Private enterprise doesn't have the ability to dip into public monies when their operations don't produce enough cash — they either sink or swim on their own merits. That's why the state should sell UTOPIA assets to the companies that would be in a position to use them profitably.

UTOPIA administrators say they agree with the conclusions of the audit, and all indications are that they're making a good faith effort to make things right. But the problems aren't procedural — they're structural. All the lipstick in the world won't make this pig look any better. UTOPIA should never have been built in the first place.

UTOPIA's board now claims that profitability is only three years away. Given the network's track record, we wouldn't be willing to bet any more of the taxpayers' money on it.

Ten years in "no place" is more than enough.

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