Charles City broadband board timeline sees July construction start

By Bob Steenson, bsteenson@charlescitypress.com

The latest timeline for the Charles City fiber optic broadband project looks for construction bid notices to go out later this month, a public hearing on the project’s specifications and estimated cost early next month, construction bids accepted in June and construction beginning in July.

That timeline, along with several other aspects of the fiber-to-the-home project, were the topics of an online meeting Tuesday of the Charles City Telecommunications Utility.

Michael Maloney, a financial advisor with D.A. Davidson & Co. of Des Moines, presented an overview of where the project is to date:

• Lookout Point Communications, working with NewCom Technologies, has designed and engineered the infrastructure needed for a retail fiber-to-the-premise service and is completing the documents needed to seek bids to construct the system.

• D.A. Davidson & Co. and Robert W. Baird & Co. have developed a financing plan to pay for the system, based on business plan estimates, using revenue bonds that will be repaid with revenue earned by the sale of services to those Charles City homes and businesses that want them.

Getting the bid documents out is an important step, Maloney said, because it sets up other time constraints that must be met.

According to the timeline, the utility board will approve the notice and posting of bid documents at its next meeting, Tuesday, April 21.

Two weeks later, at a May 5 meeting, the board will hold a public hearing on the plans and specifications of the system and estimated cost.

Four weeks later, June 2, will be the deadline to receive and open bids on the project.

On June 9, the utility board will consider the bids and award contracts. It will also approve initial user rates for services, and hold a public hearing on the financing agreements.

On June 16, the board will approve the construction contract and authorize issuance of the documents to get financing, which is then expected to be available by July 2.

And if everything has gone according to the timeline so far, construction on the fiber system would begin July 8.

Since the project is being funded with revenue bonds, rather than tax-supported general obligation bonds, city residents will not vote on whether to approve authorizing the financing, but will get a chance to offer input at the public hearings tentatively planned for May 5 and June 9.

Maloney said the board needs to establish a “not-to-exceed” amount of revenue bond financing to be used when drawing up the specifications for the funding.

“The not-to-exceed amount is not going to obligate you to borrow even one dollar,” he said. “It’s just a high threshold, … using an estimated cost of the project, related soft costs and other financing costs to create a high-end number. We want to be comfortable that we’re not going to have to go back and redo that public hearing process on the financing if bids come in a little bit higher than expected.”

Also at the meeting Tuesday, the utility board discussed marketing for the project.

Curtis Dean, president and owner of SmartSource Consulting, of Grimes, said he wants to begin work on logo design and other marketing elements.

The utility board will have final say on marketing designs, and Dean said it might be useful to get a group together — probably electronically — to brainstorm what the service’s image and message to its potential customers should be.

The utility board has sometimes been referring to the city’s fiber-to-the-home project as 3C Fiber.

City Administrator Steve Diers said the 3C stands for Charles City Communications. He also said the number three refers to the services that will be offered — internet, voice and video, referring to broadband internet service, telephone and TV channels.

Dean said he would also like the board to consider the TV lineup it wants to offer. Early feedback was that people really want Iowa stations, but this area is actually in the Rochester-Austin market in Minnesota.

He said the system may be required to carry the Rochester stations, and it would be expensive to add several Iowa stations, so perhaps they could pick just one.

Diers said the goal originally was to get KWWL in Waterloo, channel 7, and others on the board agreed that would be their choice as well.

“There’s no guarantee they’ll say yes,” Dean said regarding KWWL. “Network stations are getting pressure from their networks to not allow out-of-market carriage. I don’t think that’s going to be a problem with KWWL, because they’re owned by a fairly small TV station group, … but we won’t know that until we actually get down to the point where it’s time to start asking for agreement proposals from them, and that won’t be until fall, probably.”

The group also discussed how it will go about searching for a general manager for the operation.

Todd Kielkopf, president of Kielkopf Advisory Services of Des Moines, presented a possible profile of the position, based on input from board members on a survey he put together. The three-page document included the types and amounts of training and experience they are looking for, and general expectations they will have of the person they hire.

Kielkopf suggested beginning advertising for the position in the next couple of weeks, and to allow at least four weeks for responses.

He said that, based on the responses they receive, the board will be able to decide if it needs to hire a “headhunter” firm to help with the search.

There is $50,000 in the business plan to hire such a firm, he said, but if they get sufficient responses without it they can save that expense.