OREM — Salvation may be in sight for the UTOPIA fiber optic network, but residents may have to foot the bill. City officials are considering a proposed buyout to help the fledgling and controversial fiber optic system, UTOPIA, a proposal that would raise monthly utility costs of city residents by up to 20 percent.
UTOPIA, which stands for Utah Telecommunication Open Infrastructure Agency, was adopted by cities like Orem in 2002 as a way to bring high-speed telecommunications service to residents at affordable prices. Orem is among 10 other northern Utah cities that make up the network, including cities like West Valley, Payson and Lindon.
Macquarie, an Australian investment company, has pledged $300 million to extend the struggling UTOPIA fiber-optic network and make it available to all Orem residents, as well as the 155,000 addresses in the 11 UTOPIA cities. The deal will expand the network, which is currently 40 percent built out in Orem.
If accepted, the proposal would mean higher utility bills in 11 UTOPIA cities. Current estimates predict the increase will be about $20 a month for residents, but that number may go up if any of the 11 cities opt out of the deal. The monthly utility increase will come whether or not residents choose to use the UTOPIA network. City officials have 60 days to evaluate the proposal before accepting or rejecting it.
UTOPIA has been controversial from its creation, with lower-than-expected subscriptions and other financial issues dogging the system. Some critics have even attempted to have the State Legislature cut losses and kill the project. In its 10th year, UTOPIA has accumulated $185 million in debt and is currently only accessible to 33 percent of the 155,000 addresses in participating cities.
Some in the city office see the Macquarie proposal as a way to salvage what many see as a failing project. The proposed deal could pay off the debt UTOPIA has accumulated and provide more competitive pricing for residents. Currently Orem pays $2.8 million each year for UTOPIA.
“Orem is very serious about evaluating the proposal,” said Steven Downs, assistant to the city manager of Orem. “We’ve never had a company with the size and resources of Macquarie give us a solid proposal.”
Others are not as optimistic. “There’s a lot of information that needs to be disseminated,” said Richard Brundst, Orem mayor. “It’s not a slam-dunk deal and will require a lot of money from the citizens of Orem.”
City officials have 60 days to reach a decision. If accepted, the deal would extend more than 30 years in four separate phases.
“Most people agree that this has been a rough go,” Downs said, referring to UTOPIA’s history. Currently it costs $2,750 up front to connect to UTOPIA. Residents often make smaller monthly payments to pay for the connection. Under the proposed Macquarie deal, there would be no startup cost for installation and residents could connect for free.
More information about the Macquarie proposal can be found at gofiberutah.org. Both Downs and Brundst encourageD city residents to contact their local officials and make their opinions known at city council meetings during discussions over the next 60 days. Orem city council meetings are held every second and fourth Tuesday at 6 p.m.