Memorandum                    

City of Lawrence

City Manager’s Office

TO:	David L. Corliss, City Manager
FROM:	Diane Stoddard, Assistant City Manager
DATE:	March 2, 2015
CC:	Casey Toomay, Assistant City Manager
RE:	Continued Discussion on Proposed Fiber Policy and Fiber Leasing Framework

Background/Discussion:

The City Commission has discussed a number of items regarding the proposed fiber policy.  There have been a number of questions and significant discussions regarding the issue of common carriage and whether or not common carriage should be included or not in the policy.  Joanne Hovis with CTC attended the February 10, 2015 meeting to offer her recommendations regarding this issue and answer questions for the City Commission. She also wrote a memo for the City regarding this issue, which was discussed at an earlier meeting.  CTC’s earlier 2013 report on broadband in the City of Lawrence is available here.

Based on the discussions at the February 10 meeting, the Commission indicated that it wished to clarify that firms that provide free service under the provisions to access incentivized lease rates would not have to provide such free service at the 100 mbps level, it could be a level of service lower than that rate.  However, under other aspects of the policy, they need to generally offer a 100 mbps level service.  This clarification has been added to both the fiber policy draft and the draft lease template.

Prior recent revisions to the draft policy include items such as:

• Requirements were specified for a technician to get on a prequalified list of vendors who could complete the splices off the City fiber for the purpose of connection once a lease is in place.  These requirements call for a technician to have certifications as a “certified fiber optic technician” level I & II with a minimum of five references and five years of experience splicing fiber.  This certification requires a test and is an industry-recognized standard of qualification.  Further information on these certification requirements can be found here.   The specific requirements have been included in Section 5 of the proposed resolution and in the sample lease. 
• Regarding the fee waiver requirements, changing the fee service threshold to households with a net income at or below 140% of the net income eligible for food assistance (the prior version had 100%).   This threshold is consistent with the prior CWC agreement with the City.
• Require that companies use the fiber for the purposes of providing broadband service at the defined level within one year of signing a lease agreement with the City.  This would address concerns with companies leasing the fiber but not providing service.
• Staff believes that the reporting requirements will also enable the City to know how the company is using the fiber.  

To recap, other key provisions of the proposed policy include:

· Market Rate:  market lease rate of $62.50/year/fiber mile.

· Companies using City fiber must use the fiber to provide symmetrical high speed internet services of at least 100 megabits per second

· Standard lease term is 5 years with two renewable 5 year extensions (flexibility to consider longer term available if circumstances warrant)

· Connections to the City’s fiber network can only be made at established vault locations

· Only the City or city-approved vendors can splice into the fiber

· Private companies are responsible for costs associated with connections to the City’s network and infrastructure

· Companies will be appropriately insured

· Companies must follow the City’s right of way regulations

· In order to spur high speed internet development in Lawrence, market rate lease fees may be waived for the first five years for companies meeting the following criteria:

o Provide service to at least 300 residential or business customers and achieve this service level within 24 months of signing the agreement with the City

o Provide free service to households with a net income at or below 140% of the net income eligible for food assistance as defined and published by the Kansas Department for Children and Families (note- this provision was changed to 140% of net income eligible for food assistance from the prior 100%)

o Provide free service to non-profit organizations and institutions within its service area

The draft policy does not include language regarding a requirement or incentive for common carriage.  Should the Commission wish to include such a provision, staff could draft additional language based on Commission direction. 

Requested Action: 

Consider adopting Resolution No. 7097, adopting a city fiber policy and fiber leasing framework, or provide additional direction to staff.