April 19, 2010
Eight cities that make up the municipal broadband experiment UTOPIA have signed off on giving the public corporation $292,000 to fight a hush-hush legal battle.
The information was obtained Monday by the Deseret News through a Government Records Access and Management Act request. The UTOPIA board voted on the interlocal agreements for the funding in an open meeting Thursday morning, but the agency required a GRAMA request nevertheless and did not make the documents available until Monday morning. Generally, draft documents considered in public meetings are made available to the public before the meetings.
UTOPIA is an acronym for the Utah Telecommunications Open Infrastructure Agency, which was created in 2004 to create a fiber-optic infrastructure for 14 Utah cities.
The project has been plagued with slow signup rates and lawsuits from industry giant Qwest, as well as harsh criticism from groups like the Utah Taxpayers Association.
The money approved last week by the board of directors will be paid in addition to sales tax pledges taken on by 10 of the 11 pledging cities when UTOPIA refinanced all its debt in June 2008.
In both Murray and West Valley City, for example, the funds will come from general city coffers. Murray is responsible for 12 percent of the total cost.
“The goal is to keep those expenses down as little as possible,” said Murray chief of staff Jan Wells. “We feel like its an issue that needs to be resolved.”
Documents received in the GRAMA request say little about the proposed legal action other than calling it “a dispute” regarding “a certain financial transaction.”
However, documents from UTOPIA city Centerville point to an ongoing conflict between the fiber-optic company and the federal Rural Utility Service as the subject of dispute.
In 2007, UTOPIA attempted to borrow about $66 million from the federal agency but was given only one installment of $24 million, according to UTOPIA attorney Dave Shaw. Meanwhile, UTOPIA built out its network and created more debt than could be funded by subscribers. That led to the 2008 refinance, Shaw said.
UTOPIA executive director Todd Marriott did not deny that his agency was suing the federal government but said there could also be other disputes dealt with in closed sessions by the board of directors. Utah’s open meetings laws allow taxpayer funded entities to hold private meetings when the topics discussed concern pending litigation.
Marriott also denied that a summit held at the end of March was secret. The “informative” meetings discussed the future of broadband and future funding models for the agency, he said.
“It wasn’t noticed to anybody that wasn’t part of that circle of supporting and wanting to understand broadband and so forth,” Marriott said. “It wasn’t intended to not have a quorum to make it a secret meeting. We had to be careful so that we didn’t violate that unintentionally.”
Funds pledged by UTOPIA cities for undisclosed legal dispute
Centerville — $9,935
Layton — $49,852
Lindon — $9,176
Midvale — $18,000
Orem — $65,095
Payson — $23,000
West Valley City — $83,000
Murray — $34,000