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Deseret Morning News archives
Michal Czarnecki monitors the operation center at the iProvo NOC building in Provo in April.

Provo Mayor Lewis Billings has done the right thing by deciding to sell the city's ill-conceived iProvo fiber optic network. The City Council ought to ratify that sale quickly, helping the city unload this endless drain on city coffers.

But regardless how the mayor and others would like to spin this sale, it is a cut-and-run deal. The announced sale price, $40.6 million to a Utah provider called Broadweave Networks, barely covers the initial $39.5 million the city borrowed to begin the project in 2003. It doesn't make up for the approximately $8 million lost since then.

Generally, people who borrow money to begin a business want to add value to it, then sell at a profit. People who find themselves hopelessly unable to make the business go are happy to find someone who will pay back the initial investment and assume the debt. Provo has found such a buyer, which ought to make all city residents happy.

The people of Payson, however, should be less happy. Their City Council has called a special meeting Monday night to reconsider its decision to reject the refinancing plan of another publicly backed fiber optic boondoggle, the UTOPIA network. Payson was the only one of 11 UTOPIA cities to reject the refinance, which would turn a 20-year commitment of public funds into a 33-year commitment involving a lot more money.

Because Payson rejected the plan, it now faces immediate payments of up to $259,920 a year to cover the city's initial pledge. That's tough to handle at a time when many Wasatch Front cities are scraping bottom, looking for money and contemplating tax increases.

But UTOPIA faces the same challenges that dogged iProvo. Competitors are beginning to bring fiber optic networks into the state, at no cost to taxpayers. Subscribers are far fewer than expected. UTOPIA's new business plan requires every home to pay about $2,000 or more just to bring in the fiber, and it won't begin servicing a neighborhood until at least 40 percent of residents have signed on.

If Payson's leaders change their minds, they may well be facing a bigger payment of sales-tax revenues some day. So could the other 10 cities. Or, if they're lucky, UTOPIA will find a buyer the way iProvo did — one willing to compensate for the infrastructure already built and assume the debt.

The problem with publicly backed fiber optic systems has nothing to do with the technology or the connection speeds. It has everything to do with the fact that private businesses take calculated risks with private money, which forces them into more conservative business models. They respond to market demands, not to what they project those demands to be a generation from now. People who use taxpayer funds feel free to be far more reckless.