Todd Paris, RFP Staff Writer and Salisbury Attorney
♦ Recently I read a “Special” to the “Salisbury Fishwrapper” where Salisbury City Councilman David Post responded to an article by Danny McComas and David Young entitled “A Bipartisan Way Forward on broadband.” The dispute is over the NC Anti-broadband Statute.
The recent history is clear. When a few municipalities started building broadband networks several years back, TWC lobbied the NC legislature for a law that would prohibit municipalities from erecting and operating their own broadbands. The Act passed, but those municipalities already having them or that were under construction, like Salisbury lobbied for an exemption from the Act in exchange for being limited to not expanding beyond their city limits. This was just an exercise of raw political power and it was a close thing for Salisbury, who could have had their network shut down and been forced to “eat” tens of millions of dollars for an essentially “useless” thing. Subsequently, the FCC ruled this Act unenforceable and the matter is on appeal.
http://www.ncga.state.nc.us/Sessions/2011/Bills/House/PDF/H129v7.pdf
I have a great deal of respect for fellow attorney David Post, who after he was elected, forced incumbents Maggie Blackwell, Karen Alexander and Brian Miller to drop the farce that Fibrant was making a “modest profit” and reveal it consistently losing $3 plus million dollars per year since its inception.
This year the Council sent Mr. Post to the Broadband Convention instead of Maggie Blackwell and that after he obtained his “free water bottle and tote bag” it appears that he returned with a much rosier picture of the city’s record setting financial debacle.
Even if the “Anti-Broadband Bill” never passed, the return of on investment for expanding the network is so lengthy that Fibrant would have not had sufficient funds to expand into the county anyway and Salisbury’s taxpayers and water bill payers would’ve been put on the hook this alleged “utility”. The truth of this statement is proven by the fact that Spencer offered to allow Fibrant to expand into Spencer as long as they did not “cherry pick” only the best neighborhoods. This offer was rejected.
With a $3 plus million plus per year Fibrant deficit coming out of the general fund and this massive sum being taken away from police, fire, water and sewer, streets and other necessary infrastructure, there is no money to expand into the county. Any argument that Fibrant is failing because it was restricted to Salisbury City limits is specious at best.
While the Broadband Conference might’ve revealed instances of isolated municipalities that spent large sums of money on losing ventures to bring the internet to otherwise un-served towns and thereby counting these systems as “necessary” utilities that is not the case with Salisbury who has multiple providers offering many different options. Lest we forget TWC Maxx now gobbled up by Charter Spectrum, AT&T Gigapower, DirecTV, Dish, MagicJack and so forth.
Fibrant was a terrible business decision. The only persons who made money off of it were its employees, Mayor Karen Alexander, (who made hundreds of thousands of dollars from designing and being the project Manager of the Fibrant Building going millions over-budget) and Atlantic Engineering who apparently completed it in such a slip-shod fashion that the City is now suing them.
At this point, having weathered the worst of the recession with very conservative budgets in response to a Local Government Commission warning letter to Salisbury on low reserves, revenues were starting to recover. However instead of returning Salisbury Police Department to 2007 manpower levels, fixing our streets or working on the city-wide violence and crime, this money is just flowing into the $3 plus million dollar per year Fibrant deficit.
I fear that Council incumbents Blackwell, Alexander and Miller have co-opted Mr. Post into hooking his wagon to a debacle he neither supported nor voted for.
It would take about 3,000 more “Fiber to the home” subscribers to make Fibrant break even with present market saturation and therefore it becomes impossible to erase the 3 million plus annual deficits until the Certificates of Participation are paid for 15 years hence. Fibrant’s growth rate flattened out and it is now on a “churn cycle.” The three thousand subscribers needed to break even are impossible with a flat growth rate. An now Fibrant is staring fearfully at Charter Spectrum (the consumer-oriented Monster who swallowed TWC and Bright House and who has battered AT&T, Century Link, and countless other broadband outfits into submission by underselling them without contracts and providing outstanding service) Do we see a $4 to $5 Million deficit ahead for Fibrant when the Charter Spectrum predator pounces on Fibrant for an easy meal?
Mayor Karen Alexander and Mayor Pro-Tem Maggie Blackwell need to take the lead in defending Fibrant. It would appear they don’t want to be soiled by doing so, so they watch and take advantage of David Post’s eagerness to soil himself among fiscally wise Salisbury voters.
Fibrant in the never-ending removal process of rotted out cheap fiber optic before another system-wide collapse:
