PAYSON The Payson City Council on Monday voted 4-1 against a motion to reconsider its previous decision against a UTOPIA refinancing plan.
The council voted on April 22 to not pledge any more city funds toward refinancing Utah Telecommunication Open Infrastructure Agency construction. Payson was the only dissenter out of 11 Utah cities with future sales-tax revenues pledged toward the project. In that meeting, the council voted 4-1 against the refinance plan.
Prior to Monday's vote, Payson Mayor Burtis Bills offered his advice to the council, saying, "I looked at it financially, and I think that now is the time to be prudent."
After the vote against the motion, Royce Van Tassell, vice president of the Utah Taxpayers Association, applauded the council and its decision.
"I think that we've seen what citizen democracy is supposed to look like," he said. "There were very serious questions asked, and at the end of the day, concern for taxpayers and taxpayer dollars rightly was uppermost in the minds of City Council members, and that's to be commended."
Representing the interests of UTOPIA at the meeting was its newly elected executive director, Todd Marriott, who stressed that his agency's objective is not to compete with network providers like Qwest or Comcast but to provide an infrastructure that such companies are invited to use to provide their services. He likened the infrastructure to a 50-lane highway spanning the Wasatch Front.
"Broadband is a utility, just like electricity, just like roads, just like airports," Marriott said. "The fact of the matter is that this need has been a great need for some time. And yet, the private sector simply cannot do it. UTOPIA was never intended to be a money-making, generating machine in and of itself. It was to provide infrastructure."
UTOPIA is a fiber-optic utility backed by sales-tax pledges in 11 Utah cities. Five other cities are non-pledging members of the network.
Marriott, who once considered purchasing UTOPIA, has worked with the network as a Colorado-based consultant during its $181 million refinancing project. Before working for UTOPIA, he watched it from "an outsider's perspective," he said.
"I looked at it as a potential acquisition, then got pulled into the fray," he said.
Payson City Council member H. Kim Hancock was the dissenting voice in April's vote and introduced the motion to reconsider on Monday. Prior to making his motion, Hancock emphasized Payson's continuing commitment to UTOPIA, despite a defeated motion to reconsider.
"We have a commitment, and we're not for one second questioning whether we're keeping that commitment, not for one second. In my mind, the risk is worth the potential."
Payson city attorney David Tuckett told the council that despite Payson not joining other cities in the refinancing effort, it is still living up to all obligations made to UTOPIA.
UTOPIA began in 2002 when a number of Utah cities decided to look into the possibility of building a major fiber-optic telecommunications infrastructure that would reach each business and household in member cities. After city council votes
in each of the other 10 participating cities, Payson was the only city on the outside looking in.
The refinancing would have ended up costing Payson $12 million over a 33-year span. The concept behind the refinancing plan is to pay off a $121 million, 20-year bond with a new $189 million, 33-year bond. UTOPIA expected $11 million in new capital to be realized from the refinance.
In addition to Van Tassell, representatives from both Qwest and Comcast made brief comments in favor of the council's continued vote against refinancing.
"We're not afraid of competition," said Tyler Dallas of Qwest. "We're afraid of uneconomic competition."
Marriott said he still sees in UTOPIA "a tremendous opportunity to rescue a stranded investment here, and we'll be successful."
A one-time Brigham Young University football player, Marriott started work in telecommunications 15 years ago in Texas. He went on to create many national telecommunication companies and also has spent time in manufacturing and military technology.
A father of nine children, Marriott plans to relocate to Utah with his wife, who grew up in Farmington. He hopes to attract a strong customer base during his two-year contract.
"I believe that he is very capable," said Jim Reams, interim executive director and Orem city manager. Reams praised Marriott's experience, tenacity, creativity and entrepreneurial spirit.Marriott recently completed a multimillion-dollar product design, prototype and testing in five months with a pipeline of $1.5 million in combined sales, according to a UTOPIA press release. The new executive director also has negotiated many telecommunications deals concerning global marketing and distribution rights.
E-mail: [email protected]