08-08-2011 Council Minutes - Laserfiche WebLink

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MINUTES OF THE ORONO CITY COUNCIL MEETING Monday, August 8, 2011 7:00 o'clock p.m. (3. LMCCPAESENTATION, Continued) Franchot stated there is a strong case to be made that it is necessary infrastructure. Franchot pointed out that there are still some Orono residents who do not have internet access. Printup asked how much was spent on the survey and how much money they are talking to go to the next step. Franchot stated one of the key questions that the Commission has kept in the forefront is what the Commission is permitted to do under the joint powers agreement, and under that agreement, the Commission does have the ability to explore new technology. The next stage of the project would cost approximately $55,000, which the LMCC does have the money for, and would result in an in depth business plan that would answer all of the questions that have been raised tonight. Franchot stated in his opinion it would be money well spent. Franchot stated beyond that phase is where you would start to get into what it would actually take to finance and build out the system, and that at that point the cities would need to sign on to some type of expanded LMCC or agree to the creation of a new public entity, probably a JPA, that would go ahead and bond for the project and build it and then contract with a professional firm to operate it. Franchot indicated the LMCC would utilize revenue bonds, which do not cost the cities or the taxpayers money. Franchot stated it is similar to a person going to the grocery store and spending what could be considered taxpayer money. The money is not going to a city entity but would be going to a publicly owned entity that would then operate the system. In theory it would have local control and local customer service. Franchot commented the LMCC has a commitment to building out an infrastructure system that many people feel is critical to the City's future and would also positively impact the value of the homes in the area. Franchot noted there is ample research that indicates that good broadband access is a positive on home values. Printup stated in his view it belongs more in the private sector. Franchot stated if they could have gotten a private sector business interested in this, the LMCC would have jumped all over it. Jabbour stated it is the law that the minute they receive those funds, they are considered taxpayer monies. Franchot asked who the "they" is that he is referring to. Jabbour stated the money that is to be spent on the study would be taxpayer money. Jabbour commented that is money that could be used to pay down the building or to improve access or to stream local programs better on the internet. Jabbour stated it is absolutely rubbish to think that when you start taking a source of income to say that it is not costing the city. For Orono to improve the system, the City has to give the LMCC money. Jabbour noted the LMCD has a Save the Lake Fund and that when he sends in a donation to the Save the Lake Fund, it has to be treated as .taxpayer money and they have to abide by all the regulations that go along with it. Jabbour stated when he was the president of the merchants group in downtown Minneapolis, he asked the • MBA Program at the Carlson School of Business to do all these studies for free. Jabbour stated the Page 6 of 21