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Last night, City Council passed a Resolution on third reading that authorized the internal borrowing of $3.4 million plus and an additional $450,000 as described in the Velocity Broadband Business Plan. Originally discussed by City Council in February, the $3.4 million was already in the budget, and the additional $450,000 is now being formally approved and put in the enterprise fund. This is not a new request for funding, but simply the legislative process resulting from the passage of the Ordinance in March.
In 2015, with Council’s authorization, the City issued an $800,000 note for the pilot phase of Velocity Broadband. In 2016, Council authorized an additional $1.3 million to fund the continuation of the installation. In 2017, $1.3 million was added, bringing the total borrowing for Velocity Broadband to $3.4 million. This current ordinance authorizes the rollover of the notes plus the additional $450,000 requested in February.
At the February 26, 2019 Council workshop, staff presented the Velocity Broadband Business Plan. At the same time City Council decided to establish a separate fund and that the broadband debt service would be paid out of the newly created enterprise fund. To implement the Business Plan, the amount borrowed would need to increase from $3,400,000 to $3,850,000 to cover that additional $450,000.
The $450,000 would be used for installing splice closures, splicing, drop cables, customer premises equipment and optics, as well as contracted installers and related professional services to hook up customers along the existing Velocity Broadband fiber lines. City Council passed Ordinance 19-7 on March 5, 2019.
Last night’s legislation formalizes the amount that Council authorized back in March.