HomeMy WebLinkAbout2004-05-17 City Council (7)City of Palo Alto
City Manager’s Report
TO:HONORABLE CITY COUNCIL
6
FROM:CITY MANAGER DEPARTMENT: UTILITIES
DATE:
SUBJECT:
MAY 17, 2004 CMR: 276:04
REQUEST TO CONTINUE REVIEW OF FIBER TO THE HOME
(FTTH) FINANCING OPTIONS TO THE AUGUST 2, 2004 CITY
COUNCIL MEETING
RECOMMENDATION
Staff recommends that the City Council:
1. Continue discussion of the FTTH project from the May 24, 2004 City Council
agenda.
2. Direct the City Manager to dedicate staff time to complete research of finance and
legal options for the FTTH project and to return to City Council at its August 2,
2004 meeting with a report on the options, if any, regarding the financing of the
FTTH project.
BACKGROUND
At its April 19, 2004 meeting the City Council received the following recommendation
from the Utilities Advisory Commission (UAC) based on a 3 to 2 vote: "that the City
Council authorize the formation and construction of the fiber to the home project
pursuant to the Fiber To The Home (FTTH) Business Plan Phase 1, dated May 7, 2003
and Phase II dated March 17, 2004, subject to an advisory vote to be place on the
November 2004 ballot. The UAC recommends no additional funding for the project until
the project is approved by the City Council. Upon approval by the Council, the UAC
recommends that an expenditure of up to $120,000 be authorized for public relations and
legal analysis but not engineering design."
At that same meeting, staff informed the Council that the financing method proposed in
the FTTH Business Plan was no longer considered to be valid. Alternative plans were
outlined at the meeting, however staffinformed Council that substantial research would be
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required to fully develop these alternatives, and that the list of alternatives presented was
not necessarily comprehensive.
Having received new information regarding financing which the UAC had not received,
Council referred the FTTH financing information back to the UAC to provide the UAC
with the opportunity to review the new information and alter its recommendation.
DISCUSSION
At its May 5 meeting, the UAC reaffirmed its original referral to Council by a 5-0 vote
with the added provisions:
1. Staff not study specified finance options requiring super-majority voter approval.
3. Staff return to the UAC to report at its July 2004 meeting on the remaining finance
options and to recommend a path of action regarding the financing of the FTTH
project.
2.Staff return to Council at its August 2 meeting to deliver the finance options report
and the UAC recommendations from the July 2004 UAC meeting.
Staff does not believe that a comprehensive investigation of the financing and legal
options for FTTH can be completed prior for the May 24 City Council meeting, and
recommends that FTTH should be continued to that date.
PREPARED BY:
BLAKE HEITZ,M~N
Manager, Utilities’Telecommunications
DEPARTMENT HEAD:
CITY MANAGER APPROVAL:
UL
o f Utilities/"’----’~
Assistant City Manager
CMR:276:04 Page 2 of 2