UTOPIA/Macquarie Deal is a Mistake [The Hub Debate]

fiber-cableThis is  a Hub Debate on the proposed Macquarie acquisition of UTOPIAParticipate in the comments or submit a response for publication to UtahPoliticoHub@gmail.com.

Resolved: “UTOPIA cities are being offered a lifeline by Macquarie and, despite the estimated $18 to $20 per household utility fee increase, should take the deal.”

Supporting the UTOPIA Maquerie deal is a mistake for three main reasons:

  • Cities should not seek to compete in private enterprise.
  • More taxes won’t fix the broken network or make it more successful.
  • If passed, it is likely to be defeated in referendum.

It is entirely unacceptable for the city government to go into business for themselves. Often they do so claiming that without the need for profits they will be able to take over the market. Then, these government ventures proceed to fail again and again, always consuming more taxpayer money. This instance is particularly bad because there is already vibrant competition in the market with Century Link, Comcast, Digis, and most major cell phone companies. Requiring residents to subsidize a failing network is wrong, especially when approximately 70% of the residents who could sign up for UTOPIA have already decided not to. Residents of Orem should continue to be free to choose their own internet provider without being forced to bankroll the city’s failure.

UTOPIA supporters continue to claim that if everyone had access, the network would be successful, yet, as of summer 2013, Lindon was the only municipality with service available that had enough subscribers to cover their costs. This new deal claims to have enough money to build out the network and generate enough surplus revenue that the network’s debts are paid down.

This same recycled claim is used every two years.  We don’t need new data to recognize this false argument will never be true. The only winner in this deal will be Maquerie, which gets a 30 year income guarantee while the city is stuck with collecting and paying the bill.

Finally, just last fall the citizens of Orem overwhelmingly defeated a property tax increase intended to fund UTOPIA services and expansion. This year the city is again ignoring the residents and proposing this new ‘utility fee’ at almost three times the cost of the recently defeated property tax increase.

At every stage of UTOPIA/UIA development the Orem city council has believed UTOPIA projections of large profits if they spent more on the network, but the only results have been increased debt. Every year UTOPIA/UIA has claimed to have a lot of additional homes signed up, yet the total number of subscriptions to the network remains flat.

The residents of Orem are no longer willing to sit back and trust that our elected officials will vote in our favor.  We have had enough of the unelected city management convincing our representatives to put UTOPIA on the city credit card.

If they won’t protect our wallets, we will. The same group of volunteers that successfully defeated the property tax is ready to defeat this proposal.

It is time that we sell our interest in UTOPIA and pay off our debt as quickly as possible so that the city can get back to doing what it should have focused on all along.

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