UTOPIA member cities collectively continue to make annual payments of nearly $13 million for debt service on the bonds issued to fund the network’s development. The cities pledged a portion of their sales tax revenues as security for the bonds, the audit stated.
UTOPIA spent nearly all of its $185 million in bond proceeds, though only 59 percent of that has gone toward building infrastructure for the network, the audit found. Since then, the agency has added approximately $40 million in new debt, according to the audit.
Released in August 2012, the audit blasted the agency for poor construction planning, costly mismanagement and unwise use of bond funds.
"Slow progress in building the network and a general lack of subscribers have forced UTOPIA to use a large portion of its bond proceeds to cover operating deficits and debt service costs," the audit stated. "The use of debt to cover the cost of operations and debt service is symptomatic of an organization facing serious financial challenges."
In addition to identifying reasons for UTOPIA's financial challenges, the audit makes several recommendations to strengthen the agency's oversight and hold its staff and business partners accountable for results.
Jones said the agency is now covering all of its new debt, though its monthly operational expenses are still falling about $250,000 short.
“The $40 million is being completely covered,” he said. “We hope at some point to start making payments out of revenues directly toward the initial $185 million.”
- Housing recovery slowest since World War II,...
- Another year, another small Social Security bump
- Fire exposes illegal Chinese factories in Italy
- Developer to build replica major league...
- Millennials may do career and home life...
- Federal Reserve Chair Janet Yellen says US...
- NC-based FairPoint poised for growth after...
- Dave Ramsey says: Rehabbing your house for...
- Housing recovery slowest since World... 11
- US jobless aid applications fall to... 5
- Audit cites 'inadequate oversight' in... 5
- How students are engaging textbook... 4
- Millennials may do career and home life... 3
- Another year, another small Social... 2
- HBO unleashes streaming from cable... 1
- Federal Reserve Chair Janet Yellen says... 1