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Home My WebLink About8 Broadband Status Report Agenda Item # CkiE t« wit r,_','V'� TR 1EE Wo To: Board of Directors From: Peter Holzmeister Date: June 27, 2003 Subject: Broadband status report WHY THIS MATTER IS BEFORE THE BOARD The Board has asked for an update on the amount of money that we have spent to date on the Broadband issue. Also included is a status report and analysis of future tasks. HISTORY We began to look at offering high-speed broadband services a few years ago. Our vision was to deploy in Truckee a system that would connect Truckee to the high-speed network that is being deployed in metropolitan areas throughout our country, but is not being deployed as quickly in smaller towns. This high-speed network is an important tool for the conduct of business and to share information. if Truckee has this tool available we are more likely to prosper in the emerging new world. We began by employing the services of RMI(Navigant to prepare a business case analysis. That report concluded that a broadband system could be deployed in Truckee at a reasonable cost. The system could be used to offer Internet service, business to business data service and cable TV service. The analysis demonstrated that construction and operation of such a system would be financially viable. We then employed the services of Sierra Market Research to survey a sampling of our customers to determine their satisfaction with current voice, video and data providers. The survey concluded that there is considerable dissatisfaction with current video and data service in Truckee, and that the entry of TDPUD into the broadband business would be welcome. We then employed the services of Vectren to review the earlier studies. Vectren validated the basic conclusions of the Navigant and Sierra Market Research studies, and went on to suggest that a broadband system deployed by TDPUD should accommodate voice service as well. We then designed a hybrid fiber-coax system for deployment in our service area. We continued to monitor developments in broadband technology and related costs, and came to realize that the cost to deploy a fiber-to-the-home system had become competitive. We redesigned our system to incorporate a fiber-to-the-home concept. We applied to Nevada County LAFCo for activation of the latent power to enable us to offer broadband communication services. LAFCo gave tentative approval subject to satisfying a few conditions. We began to develop the funding program to construct the system and we launched a community awareness program. We have been very careful each step of the way. Some suggest we have studied the issue to death. We have certainly been diligent in our study. We spent $1.1 million dollars in the effort, of which $412,000 is District staff time. Please review the attached financial analysis. NEW INFORMATION We have completed Phase 1, the prolonged business study process. The Board has given tentative approval to launch a broadband business unit. We are now involved in Phase 2, implementation of the business plan. This phase involves five basic interrelated tasks. Task 1: We are arranging for delivery of service content to Truckee Task 2: We are arranging for construction financing Task 3: We are preparing to construct the broadband system Task 4: We are preparing to complete the regulatory requirements Task 5: We are planning the service launch and setting up the broadband organization Attached is a table describing subtasks within these general tasks. RECOMMENDATION I recommend that the Board authorize staff to proceed with the attached list of subtasks TRUCKEE DONNER PUBLIC UTILITY DISTRICT Fiber/Telecom/Broadband Related Disbursements through 6/13/2003 Disbursements to Date Study&Analysis RMI/Navigant $102,667 Sierra Market Research 15,300 Vectren Financial Analysis 10,000 Third Networks, Inc. 286,000 District Labor& Overhead 411,934 Misc Materials&Supplies 26,193 852,094 Legislative Braitman &Associates 11,239 LAFCO 15,000 26,239 Legal Porter Simon 59,686 Dennis DeCuir 113 59,798 Advertising/Public Relations Pettit Gilwee 16,013 Financing Aggregate Networks 150,052 Subtotal; $1,104,196.' Williams Communications Conduit RMI/Navigant-Construction Inspection 60,667 Williams Communications- Encroachment Permit 122,780 District Labor&Overhead 66,397 249,844 Total Broadband Related Disbursements $1,354,040 Broadhand Analvsia Board Packet 7-M3 6/27103 BROADBAND PHASE 2 IMPLEMENTATION TASKS TASK I—CONTENT (SureWest contract for video and data service) June 251h—Initial MOU Structure (TDPUD, Aggregate, SureWest) July 2nd—Pricing Schedule (SureWest) July 16—Board reviews content for video and data offerings July 3 1"—Binding MOU; pricing &business terms (TDPUD, Aggregate, S&M) Early August—Board approves content August 31 s`—Contract—(TDPUD, Aggregate Networks, Spiegel & McDiarmid) Early September—Board approves content contract TASK 2—CONSTRUCTION FINANCING September 15'h - Feasibility Study(RW Beck) September 30`h—Audit of Feasibility Financials (KPMG) September 30t'—S&P Rating(RW Beck, Friedman, Aggregate, TDPUD) September 30s'—Insurance(Friedman) September?—Official Statement(Casnocha) October P—Sale of COP's (Friedman) TASK 3 —CONSTRUCT THE SYSTEM Bid Documents July 9rh—Format of Construction Bid(TDPUD, Aggregate, FSC, Friedman) July 151h—Completion of Electronics (TDPUD, Aggregate, FSG, Friedman) July 31 ar—Completion of Construction(TDPUD, Aggregate, FSC, Friedman) Early August—advertise for bids Third week of August—Open bids and present recommendation to the Board Early October—Issue notice to proceed TASK 4—REGULATORY LAFCo Communicate with Executive Director and Commissioners Status of Project Feasibility Study(for S&P by RW Beck) Early October—submit finance plan to LAFCo Cable Television Franchise Town of Truckee—Complete Nevada County—In Progress (County Staff and Attorney's Office) Placer County—In Progress (County Communications Department) Federal Communications Commission June 23`a— Spiegel & McDiarmid determine that FCC License is not necessary July 15`h—Notify FCC of project, receive Federal ID Number(Spiegel & McDiarmid) TASK 5—LAUNCH Public Relations, Marketing& Customer Communication Press Releases Sierra Pacific Communication Closing SureWest LOI for Content Guest Columns Advertisements Early July-Logo, Name and Tag Line Contest Pre-Construction Offer Mailing after July 41h weekend Communication All Employees Meeting (July) Initiate assistance in customer communication program Prepare organizational plan Organization chart (Alan) Narrative description of service delivery(Alan) Staff and job descriptions (Alan) Policies and procedures (Alan for submission to Board)