That's interesting. Can you share more details about being a service provider 
on the iProvo and AF networks? In what way we're they substandard?


> Sent: Monday, August 07, 2017
> From: "Sterling Jacobson" <>
> To: "" <>
> Subject: Re: [AFMUG] OT Municipally funded ISPs
> I agree with that.
> The numbers never added up. iProvo never added up, Utopia never added up, 
> Amercian Fork system numbers never made any sense.
> I was a network provider on iProvo and AF networks for a while and sold them 
> off since they were always substandard and profit was driven to minimum.
> -----Original Message-----
> From: Af [] On Behalf Of
> Sent: Sunday, August 6, 2017 10:46 AM
> To:
> Subject: [AFMUG] OT Municipally funded ISPs
> Here is an editorial in the Deseret News today.  It is just an opinion.
> And I know Roger has been a reader of this list (Roger runs UTOPIA).
> But I have always been against municipal ISPs on principle.  Some things the 
> government is good at, some things they are not good at.
> Roads and Streets == OK
> Police and Fire == OK
> EMS = OK but there are private providers that are OK too.
> Water and Sewer = OK but there are many private systems Power and Gas = Meh  
> -  I work in a city that has sold off their power and gas to private because 
> it was not a revenue center and they had lots of power distribution problems.
> Telecommunications != OK
> They almost always seem to be problematic.  And they compete with all of you 
> (us) folks that can do a better job.   (Sorry Roger, but that is my 
> opinion).
> A longstanding principle of the Utah Taxpayers Association is if a service 
> can be found in the yellow pages, then government shouldn’t be providing it. 
> We have seen far too many times where government attempts to compete with the 
> private sector and ends up wasting taxpayer money. One prime example of this 
> is the failed UTOPIA boondoggle that continues to plague the 11 cities that 
> created the entity.
> On Aug. 14, the Utah Infrastructure Agency, which was created in 2011 to give 
> UTOPIA more borrowing capacity, will vote on taking out a $13 million bond to 
> further build out the UTOPIA network in hopes of making the whole effort 
> profitable. The vote will likely pass but the effort to make UTOPIA and UIA a 
> success for taxpayers will never be realized.
> This attempt to continue to send money after a bad idea has to stop.
> The private sector is already providing the same service that can be obtained 
> through UTOPIA and it is past time that the local governments that created 
> this mess find a way out.
> Recently, the University of Pennsylvania released a study that examined 20 
> municipally owned fiber networks from across the nation; UTOPIA was included 
> in the study.
> The report found that a majority of these networks struggle to recover the 
> costs that were incurred to build them. It went on to show that of the 20 
> projects, only nine have had a positive revenue stream but that of those 
> nine, five are generating returns so small that it would take more than 100 
> years for the project costs to be recovered. Only two of the 20 networks are 
> expected to earn enough to cover their project costs during the useful life 
> of the networks.
> The Penn report went on to state that these government-owned ventures 
> struggle to ever make a profit and put taxpayers in danger of seeing their 
> local government increase debt, lose bond rating status and elected officials 
> becoming distracted from other important issues because they are solely 
> focused on the government’s fiber business. The report found that if UTOPIA 
> continues in its current state, that the project will likely never turn a 
> profit. It observed in a five-year span from 2010-2014 that the network only 
> obtained 11,000 subscribers and that with a low subscription take the network 
> was realizing less than $30 in revenue per household in the cities that make 
> up UTOPIA. That is well below the $446 per household benchmark  achieved by 
> other projects that the report looked at.
> I am often asked why the Utah Taxpayers Association cares so deeply about the 
> UTOPIA issue. One statement from the Penn report sums up why we have taken 
> the position we have as the report states, “Many cities managing these 
> projects have faced defaults, reductions in bond ratings, and ongoing 
> liability, not to mention the toll that troubled municipal broadband ventures 
> can take on city leaders in terms of personal turmoil and distraction from 
> other matters important to citizens. City leaders should carefully assess all 
> of these costs and risks before permitting a municipal fiber program to go 
> forward.”
> The risks and consequences are too much for taxpayers to shoulder.
> UTOPIA and UIA officials should vote against the upcoming $13 million bond 
> and start looking for new directions to take the network that will be 
> beneficial for taxpayers instead of continually investing money into a 
> sinking ship that will never be sea-worthy.
> Billy Hesterman is the vice president of the Utah Taxpayers Association.

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