Your PUD News Release
PUD still studying $25 million fiber grant offer
Chelan County PUD
News Release
8/16/2010
PUD commissioners were told Monday that they’ll have to make a relatively quick decision on whether to accept a $25 million federal grant being offered to help expand the PUD’s wholesale fiber-optics network to more remote areas of Chelan County. Once the PUD receives the formal paperwork, the deadline to respond is seven days.
Commissioners were also told by PUD legal staff that unexpected requirements in the terms and conditions of the grant might short-circuit any possible PUD acceptance of the money, no matter how much it might be desired.
New General Manager John Janney has said the PUD will study impacts of the decision carefully.
Further details of the grant’s legal requirements and potential long-term impacts on PUD finances will again be discussed during the board’s regular meeting at 1 p.m. next Monday (Aug. 23). Uptown Services, of Duluth, Ga., has been analyzing the PUD’s fiber and will report to commissioners. Results of a customer survey will also be presented.
Commissioners will hold a special meeting for additional public comment on the grant at 5:30 p.m. Tuesday, Aug. 24, at the Confluence Technology Center. No decision will be made by the board that night.
John Smith, the PUD’s managing director of Engineering and Technology, told commissioners the PUD would be obligated to match 25 percent of the grant in order to receive the funding. That would be $8.3 million. He also said extending lines and equipment to reach approximately 6,800 more customers would have to be done within three years – requiring a logistics plan capable of spending nearly $1 million a month for that time – a significant commitment of staff and material.
Staff attorney Erik Wahlquist said he’s been on the phone daily with administrators of the federal program explaining to them the limits of PUD obligations as determined by state law and bond covenants. For example, the PUD cannot pledge future revenues as collateral. In addition, the federal program wants a PUD pledge to operate the system that’s built with the funds for the next 22.4 years. What happens, commissioners asked, if technology changes significantly. Would the PUD be stuck operating an outdated system?
Commission President Dennis Bolz pointed to the change in cellular phones from 20 years ago to now. Commissioner Norm Gutzwiler said he has a lot of concerns about the pace of the build-out and told staff he was glad they are going through the grant requirements with a fine-tooth comb.
Wahlquist said he is optimistic the questions on legalities can be resolved and that the final package might come to the PUD before the end of this week. That would provide enough time for next week’s regular board meeting, for the special Tuesday evening meeting and then another possible special meeting if commissioners need to make their decision.
In other business, commissioners:
- Approved the progress report on the District’s Integrated Resource Plan, as required by the state Department of Commerce;
- Passed a resolution hiring John Janney as the general manager of the PUD and establishing his salary at $280,000 per year.
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The next regular commission meeting is at 1 p.m. on Monday, Aug. 23, in the PUD boardroom at 327 N. Wenatchee Ave. The board will also meet in special session at 9 a.m. Monday, Aug. 23, at the North Central Regional Library headquarters for a board retreat.
Most PUD commission meetings are recorded, and a link to the audio is available on the PUD’s home page at www.chelanpud.org.
Steve Lachowicz
Communications director
509-661-4639, direct line
509-679-0148, cell
steve.lachowicz@chelanpud.org