(TNS) -- ROCK FALLS – The city moved ahead Tuesday with plans to roll out its broadband business.
The City Council looked at an ordinance to authorize the issuance of bonds to pay for the estimated $13 million fiber-optic network expansion. The ordinance was given a first read, and the council moved it on for action by a vote of 6-to-1.
The ordinance states that the total bond amount for the costs of designing, building, and operating the system can't exceed $13 million, but the project is to be done in phases.
"I'd like to remind everyone that although this is for $13 million, it won't all be done at once because of our fiberhood business model," Mayor Bill Wescott said.
That business model is based on building 14 fiberhoods, at an estimated cost of $250,000 for each area. The model is the product of more than 2 years of work with Magellan Advisors, the city's broadband consultants.
The fiber expansion would begin along the city's business corridors. To mitigate risk in the residential buildout, a fiberhood wouldn't be built until at least 45 percent of the area's residents were signed up for service. The business plan could be adjusted as needed.
Alderman Rod Kleckler cast the lone dissenting vote on the bond ordinance. His biggest concern had nothing to do with prospects of failure.
"If the fiberhoods are a huge success, what's going to happen to the other businesses like Comcast and AT&T? I can't imagine they'd stay in the community, and then we'd be losing a lot of money in franchise fees," Kleckler said.
City officials countered that the upside to having Comcast in town has been dissipating.
"The franchise fees have been going down steadily, and a lot of that is because of dissatisfaction with Comcast," City Administrator Robbin Blackert said. "People are switching to satellite, which we get nothing for, or cutting the cord entirely."
Blackert said residents are constantly bringing Comcast equipment to City Hall, frustrated with the company's customer service. The relationship has also been strained with the city.
"We haven't been able to solidify a contract with them in a decade, and we've lost revenue – it's not been a good relationship," Blackert said. "The company has become too big and hard to deal with."
The council also gave Blackert its approval to complete the city's underwriting agreement with Robert W. Baird & Co. for the bonds. Kleckler was the only alderman to vote against the pact. Although the bond ordinance hasn't been passed yet, Blackert said the underwriters needed to start gathering information next week.
Also, Wescott announced he will give his annual State of the City address at the Feb. 21 council meeting.
The Rock Falls City Council next meets at 6:30 p.m. Feb. 21 at City Hall, 603 W. 10th St.
The agendas will be posted at rockfalls61071.net and at City Hall. Call 815-622-1100 for more information.
The council meeting also airs live on Channel 5.
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