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Plan to 'save' UTOPIA advances in WVC

By Scott Dunn, KSL.com Contributor | Posted - May 29th, 2014 @ 11:31am



This archived news story is available only for your personal, non-commercial use. Information in the story may be outdated or superseded by additional information. Reading or replaying the story in its archived form does not constitute a republication of the story.

WEST VALLEY CITY — The West Valley City Council voted overwhelmingly in favor of proceeding with Milestone 2 of its investigation of the Macquarie Proposal Tuesday.

The Macquarie Proposal is seen by many to be the savior of the enormous investment West Valley City has made in the UTOPIA fiber optic network. For at least the last year, the UTOPIA cities, including West Valley City, have been pouring over a new proposal to save the UTOPIA network and complete the build-out for all residences and businesses.

Macquarie Capital Group is an international infrastructure company that boasts locations in 28 countries, 11,000 employees and nearly $400 billion under management. Macquarie officials say the company has the resources to fire up the rollout and run it to completion while providing a consistent revenue stream to the cities that approve the proposal.

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The vote Tuesday evening was pivotal in that the city would demonstrate its commitment by placing as much as $350,000 in escrow to begin the next phase of the investigation. The money would be used to cover the costs incurred by Macquarie should the city decide to end the investigation and pursue other options.

During the meeting, other options were publicly considered. Selling the network has been considered and the city has been courted by potential buyers, but the terms were so onerous that they have been roundly rejected. Buyers have offered pennies on the dollar, leaving the city with the debts to contend with and no vehicle to generate revenue to pay down the debts.

City manager Wayne Pyle sits on the UTOPIA Board. The vote also delegated authority for Pyle to make the city’s position known to the UTOPIA Board of Managers.

In response a question about other proposals, Pyle said that the city has been courted by other entities that were not named, to join in a partnership to revive the build out of the UTOPIA network. Pyle recommended the city set those other proposals aside and focus on the proposal before them to conserve time. The council agreed that no other better offers have been made to counter the Macquarie proposal.

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The council also considered “going dark” or turning off the network. Pyle noted that any change in control, either by going dark or selling the network, would trigger a call on the bonds that have been sold by the cities to finance the network rollout. In this light, the council agreed that going dark or selling the network were at best, unpalatable options, and at worst, very expensive.

The vote was nearly unanimous with the lone exception of mayor Ron Bigelow. He expressed concern about vagueness in the proposal so far, and said he felt unsure about the actual total costs the city would incur for the proposal. Despite his doubts about the proposal, he said that if the council voted in favor of proceeding with Milestone 2, he would support the decision and do his best to see it through.

Video of the meeting can be viewed online.

Scott Dunn is a writer and techology worker living in West Valley City.

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