[Davisgig] Davisgig Digest, Vol 52, Issue 2

Christine Crawford c2crawford at gmail.com
Sun Jun 2 11:31:23 PDT 2019


I think a reasonable person can draw the conclusion that citywide municipal broadband is an expensive and significant undertaking with “meh” public support from the statically valid survey. And to suggest a narrative that this is due instead to some conspiracy is irresponsible. 

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> On Jun 2, 2019, at 10:03 AM, davisgig-request at list.omsoft.com wrote:
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> Today's Topics:
> 
>   1. Dueling OpEd's in the Enterprise (Robert Nickerson)
> 
> 
> ----------------------------------------------------------------------
> 
> Message: 1
> Date: Sun, 2 Jun 2019 10:03:48 -0700
> From: Robert Nickerson <rob at omsoft.com>
> To: Davis gig <davisgig at list.omsoft.com>
> Subject: [Davisgig] Dueling OpEd's in the Enterprise
> Message-ID: <55b669fd-0f61-a2d8-3b4a-0bff5601504f at omsoft.com>
> Content-Type: text/plain; charset="utf-8"; Format="flowed"
> 
> Hi
> 
> Drama!
> 
> The first time I met DC he was negative on municipal broadband, and has 
> refused to meet with DavisGIG. Other residents have talked to him on the 
> subject and? they report him as very pessimistic and negative. He ha as 
> hardened it seems. There is language used here that I heard about a 
> month ago from a report on one of those meetings, and so he seems 
> determined to shut it down, and has likely convinced the rest of the CC 
> to do the same.
> 
> To get him so agitated to put out such a strong hit piece means 
> something. The city staff report too is trying to shut this off hard at 
> the next meeting.
> 
> Methinks they doth protest too much.? Whether is covering for the 
> Comcast franchise debacle, or huge corporations are their friends, or a 
> personality conflict I cant say.
> 
> Here is a link to the OpEd you all helped create that went live this 
> morning:
> 
> https://www.davisenterprise.com/forum/opinion-columns/commentary-kicking-the-tires-on-broadband/
> 
> At this point, I'm carrying on with my final letters to CC today, will 
> speak at the meeting, but we will have to see where it goes from there. 
> It would be prudent to ask CC not to make any major decisions about this 
> at that meeting, but to hopefully give it more time and consideration.
> 
> Any thoughts?
> 
> Take Care
> 
> RAN
> 
> 
> 
> 
> ---
> 
> 
>  Commentary: Municipal broadband network would be a huge risk
> 
> 
>          By Dan Carson
>          Special to The Enterprise
> 
> This Tuesday, the Broadband Advisory Task Force will step forward with 
> its final comments on whether the city of Davis should build and operate 
> a municipal fiber network that could bring higher broadband speeds and 
> new services and technology to our community.
> 
> BATF?s community broadband advocates wrapped up three years of hard work 
> as citizen volunteers with a letter endorsing such a venture in concept. 
> The panel did not offer a specific plan to accomplish their dream, 
> calling instead for more financial and technical studies of building 
> such a system. All Davis citizens should read and consider the 
> conclusions of BATF and its response by city staff. I welcome their 
> advice and thank them for their public service.
> 
> But don?t just read their latest letter ? read all of the information 
> the task force produced. Under the auspices of BATF, the city hired one 
> of the top teams of telecom experts in the country, CCG Consulting and 
> Finley Engineering, to assess the feasibility of a municipal fiber 
> network in Davis and whether local residents would sign up for it. They 
> determined that a municipal broadband project would be costly and risky 
> and that community interest in committing to pay for such a service is 
> weak. Specifically, they found that:
> 
> * Building such a network in Davis would be costly. The entire system 
> would have to be buried underground. Our high population density means 
> conduit and fiber must be laid down both sides of residential streets, 
> instead of the customary one side. High labor costs would boost 
> construction and operating costs.
> 
> * The total cost of construction would exceed $100 million, comparable 
> to the cost of a new water system or sewage treatment plant. Bond 
> issuance fees, working capital, capitalized interest and a debt service 
> reserve would bump up borrowing costs for construction to as much as 
> $140 million.
> 
> * Similar ventures have failed in Monticello, Minn., Crawfordsville, 
> Ind., and Alameda.
> 
> * Because investors view broadband revenue bonds as pretty risky, the 
> city might have to pursue a general obligation bond (requiring 
> two-thirds voter approval) and make our General Fund a backstop for 
> paying off bonds if the broadband venture failed. That could put 
> pressure on the funding source used to pay for police, fire, parks, and 
> roads.
> 
> * Even under fairly optimistic assumptions about the number of customers 
> who would sign up for municipal fiber, the consultants said, ?the 
> financial projections for building fiber within the city were not as 
> good as the city had hoped for.? Operating losses would occur on Day 1 
> and range from $34 million to $81 million over 25 years. Competitive 
> pressures mean that the system would be unable to charge higher rates to 
> customers to match Davis? higher costs.
> 
> * Because customer fees would likely fall short of supporting a 
> municipal fiber system, the city would have to seek voter approval for a 
> tax hike to provide between $33 million and $60 million in taxpayer 
> subsidies. A sales tax increase of a half-cent or more is considered 
> most likely. Locking up tax money for a municipal fiber system would 
> require two-thirds voter approval. The consultants said winning over 
> Davis voters, who recently rejected a parcel tax hike for road repairs, 
> ?would undoubtedly require a major effort to educate the public and get 
> community buy-in.?
> 
> * Comcast, our biggest local broadband provider, has a track record of 
> cutting rates and improving its bundled services to crowd out 
> competitors. A Davis municipal broadband network might need even more 
> public taxpayer dollars to compete.
> 
> * Davis has good broadband options today, even without the development 
> of a municipal fiber system. Comcast is now advertising 1 Gbps and 2 
> Gbps internet download speeds in their ?Gigabit? and ?Gigabit Pro? 
> packages. Only 16 percent of Davis residents are unhappy with their 
> internet services.
> 
> * A college town could be tough for Davis broadband, with students 
> likely to be fickle customers. Moreover, large student apartment 
> complexes in Davis have locked in long-term deals with various private 
> providers for internet and cable services, and Comcast and AT&T are 
> moving aggressively to lure more such customers.
> 
> * Only 21 percent of Davis residents said they would definitely buy 
> their service from a city system. ?This is significantly lower than what 
> we have seen in other markets,? the consultants stated, and ?indicates a 
> market that is not massively unhappy with the incumbent providers and 
> not wildly enthusiastic about fiber. It?s a market where a new provider 
> would need to prove themselves and expend significant marketing effort 
> to win over customers.?
> 
> Recent developments make a large public investment in broadband seem 
> more risky than ever in a highly competitive, and increasingly 
> disruptive, broadband marketplace.
> 
> The FCC last year opened the gates for cellular wireless 5G service by 
> imposing strict time limits for cities to allow the installation of 5G 
> equipment on utility and light poles. Two companies have already filed 
> permits to establish 5G networks in the city of Davis ? permits it has 
> no legal choice but to approve. And, the master of all business 
> disrupters, Amazon, has begun launching thousands of low-level 
> satellites into orbit capable of providing broadband worldwide. 
> Competitors like SpaceX**are hot on their heels. Broadband technology is 
> morphing rapidly and the market is fragmenting.
> 
> Despite the troubling findings in the CCG and Finley Engineering 
> reports, task force members remain steadfast in their support of the 
> concept of a municipal fiber system. They are asking the city to spend 
> more money on studying such ideas as building a municipal fiber network 
> in stages or levying assessments instead of taxes to pay for it.
> 
> I look forward to hearing more about these ideas, but worry about a 
> bullet train-style boondoggle in which construction starts only to find 
> out that the rest of the money needed to finish a network isn?t coming. 
> Davis could end up building a ?network to nowhere.? Imposing citywide 
> assessments or taxes could force Davis consumers who want to keep their 
> Comcast or AT&T bundles to pay a second time for a municipal broadband 
> system they don?t want. That doesn?t seem fair.
> 
> Nobody disputes the benefits of improved high-speed broadband for 
> economic development, education, technological innovation and addressing 
> the digital divide. The question is, how do we get these benefits 
> without saddling our taxpayers with huge financial risks? We already 
> face an $8 million a year funding gap for basic city services over the 
> next 20 years.
> 
> This Tuesday, I would also like to get the community?s feedback on a 
> different approach I call, ?If you can?t beat ?em, join ?em.? Instead of 
> further studies of municipal broadband, should we explore how we can 
> forge innovative partnerships with the private sector and UC Davis to 
> foster high-speed broadband competition that will improve service and 
> reduce monthly bills for Davis businesses and residents?
> 
> 
> 
> On Saturday, June 1, 2019, 10:42:45 AM PDT, Robert Nickerson 
> <rob at omsoft.com> wrote:
> 
> 
> Hi
> 
> I'd get your coments in early. They dont want to be reading this stuff 
> at the last minute.
> 
> As this could be our last hurrah, Im sending 3 emails, past present future.
> 
> Attached is the first one, I hope to have the others out tonight.
> 
> 
> Is this too strong or? offensive a thing to say something like:
> 
> "City Staff has been wrong all along. Harriet was wrong about Comcast. 
> Astound on consent with no BATF input was wrong. This staff report 
> analysis of municipal fiber is also wrong...etc"
> 
> 
> On 6/1/2019 10:26 AM, Matthews Williams wrote:
> To facilitate this process I have attached three Word documents
> 
>        (1) the original BATF memo to Council from 2018,
>        (2) the side-by-side discussion document that has what Chris
>        proposed as the text of the second BATF memo to Council on the
>        left, and (most of) the suggested revisions on the right,.
>        (3) the various suggestions provided by BATF members in the
>        April BATF members
> 
> Being able to copy and paste from those documents should help avoid 
> unnecessary retyping between now and Tuesday.
> 
> Matt
> 
> 
> On Saturday, June 1, 2019, 8:35:07 AM PDT, Lorenzo Kristov 
> <lkristov at cal.net> <mailto:lkristov at cal.net> wrote:
> 
> 
> Good suggestion Jim. I will try to talk with Lori about that today.
> 
> 
>> On May 31, 2019, at 10:13 PM, Jim Frame <jhframe at dcn.org 
> <mailto:jhframe at dcn.org>> wrote:
>> 
>> Mike Webb made it clear to me that city staff isn't going to solicit 
> a contract from Lori Raineri unless the CC directs them to do so.? My 
> suggestion would be for Lori to draft a contract, package it with a CV 
> and a cover letter, and submit it to Mike with cc's to the 
> councilmembers.? Although it's too late to get that onto the Tuesday 
> agenda, it would introduce the city players to the possibility.? Even a 
> letter of intent from Lori (along with a CV; that's important because 
> Mike told me doesn't know anything about her) would be better than nothing.
>> 
>>> On 5/31/2019 1:05 PM, Lorenzo Kristov wrote:
>>> The BATF did recommend working with a muni finance expert on funding 
> options, that was one of the two next steps recommended, it just didn?t 
> name Lori.
>>>> On May 31, 2019, at 12:34 PM, Robert Nickerson <rob at omsoft.com 
> <mailto:rob at omsoft.com> <mailto:rob at omsoft.com <mailto:rob at omsoft.com>>> 
> wrote:
>>>> 
>>>> Hi
>>>> 
>>>> Since it didn't come from the BATF the city wont consider it. If we 
> could get actual BATF members to sign off on it they might be more 
> receptive.
>>>> 
>>>> As a BATF member how do you feel about Staff seemingly going 
> totally against the BATF recommendation as expressed in? its letter? 
> Anything we 'd need to do should be sent out by tomorrow am at the latest.
>>>> 
>>>> Thanks
>>>> 
>>>> RAN
>>>> 
>>>>> On 5/31/2019 12:00 PM, Lorenzo Kristov wrote:
>>>>> Just thinking out loud, but in the interest of time I?ll send 
> these initial thoughts for y?all to react to.
>>>>> 
>>>>> Staff is recommending the entire municipal effort be put to rest, 
> and the big fear they?re playing on is cost. So my thought would be to 
> bring CC a next step recommendation that costs almost nothing and could 
> make the project seem more feasible from a cost perspective. That is, 
> recommend that city execute a pro bono contract with Lori Raineri to 
> explore and lay out potential financing approaches, working with a city 
> staff person and a small group of citizen volunteers from among this 
> email list, perhaps others. But small (3 people or so) so it can start 
> moving quickly and minimize scheduling problems, and report back to CC 
> in a couple months. I?d emphasize including someone with financing 
> expertise (e.g., Matt, David) and focus narrowly on the funding aspects 
> of the project rather than the technical.
>>>>> 
>>>>> On a parallel track, it might make sense for a few more 
> technically oriented folks (e.g., Rob, David, Jeff) to sketch out what 
> would be needed from a consultant to address the second BATF recommended 
> next step, the technical. I wouldn?t expect city staff to be working on 
> this yet, since Diane did say they?re planning to come back with the 
> Wave contract. But if CC approves step 1 to begin working formally with 
> Lori, then we could have step 2 ready in a month or so, to lay out a 
> rough SOW for a consultant on the technical, cost, etc. elements of the 
> phased implementation. A main argument for Wave is that ?there is no 
> other proposal on the table.?
>>>>> 
>>>>> Other thoughts?
>>>>> 
>>>>> ? Lorenzo
>>>>> 
>>>>> 
>>>>> 
>>>>>> On May 31, 2019, at 9:41 AM, Robert Nickerson <rob at omsoft.com 
> <mailto:rob at omsoft.com> <mailto:rob at omsoft.com <mailto:rob at omsoft.com>>> 
> wrote:
>>>>>> 
>>>>>> Hi Folks
>>>>>> 
>>>>>> Yowch folks, take a look at Diane Parro's staff report. It reads 
> like it was written from the POV of a large incumbent carrier, lol.
>>>>>> 
>>>>>> I suppose anything we send in support needs to counter Diane's 
> points one at a time. There is absolutely no positive evidence about 
> this presented in the staff report.
>>>>>> 
>>>>>> Any ideas on how to go from here?
>>>>>> 
>>>>>> Thanks
>>>>>> 
>>>>>> RAN
>>>>>> 
>>>>>> 
>>>>>> 
>>>>>> 
>>>>>> -------- Forwarded Message --------
>>>>>> Subject: ??? [Davisgig] PLEASE READ Staff Report
>>>>>> Date: ??? Thu, 30 May 2019 22:10:13 -0700
>>>>>> From: ??? rob <rob at omsoft.com <mailto:rob at omsoft.com>>
>>>>>> To: davisgig at list.omsoft.com <mailto:davisgig at list.omsoft.com>
>>>>>> 
>>>>>> 
>>>>>> 
>>>>>> HI All
>>>>>> 
>>>>>> The agenda is out and the staff report item on community 
> broadband is out. I don't think we are going to have any luck as Diane 
> Parro is saying this should be shut down. None of the points in this 
> memo were covered at any BATF meetings, the product of which was the 
> attached letter.
>>>>>> 
>>>>>> Thanks
>>>>>> RAN
>>>>>> 
>>>>>> 
>>>>>> 
>>>>>> 
>>>>>> 
>>>>>> --
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>>>>>> <08-Broadband-Task-Force-Final-Report.pdf><Attached Message Part.txt>
>>>>> 
>>>>> 
>>>>> --
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>>>> --
>>>> Robert Nickerson
>>>> UCD Class of 1996
>>>> CEO, Om Networks
>>>> 
>>>> cell: 5308483865
>>>> www.omsoft.com <http://www.omsoft.com>
>>>> 
>>>> 
>>>> --
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>> --
>> ---------------------------------------------------------------------
>> Jim Frame jhframe at dcn.org <mailto:jhframe at dcn.org> ? ? ? ? ? ? ? 
> 530.756.8584
>> Frame Surveying & Mapping? ? ? ? 609 A Street? ? ? ? Davis, CA 95616
>> -----------------------< Davis Community Network >-------------------
>> 
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> 
> 
> -- 
> This message has been scanned for viruses and
> dangerous content by MailScanner, and is
> 
> believed to be clean.
> 
> -- 
> Robert Nickerson
> UCD Class of 1996
> CEO, Om Networks
> 
> cell: 5308483865
> www.omsoft.com  <http://www.omsoft.com>
> 
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