High-speed internet project for Nevada County gets green light (DOCS)
December 10, 2018
The California Public Utilities Commission has signaled approval of the sale of Bright Fiber Inc. to Race Communications with some changes, a move that after months of inaction advances a high-speed internet project in Nevada County.
The CPUC on Monday released a resolution detailing the changes, which include having 75 percent of the project on existing utility poles instead of "primarily underground." Additionally, the utilities commission grant — which comprises 60 percent of the total project cost — will be reduced by almost $70,000, for a total of $16,086,789.
The utility commission must approve the sale — a vote scheduled for Jan. 10.
"I am pleased to hear that the sale of Bright Fiber to Race Telecommunications is poised to be approved by the PUC on January 10," said Nevada County Supervisor Heidi Hall, a supporter of the project, in a message. "This should be another significant step towards better broadband access for our rural area."
Race Communications and John Paul, owner of Bright Fiber, couldn't be reached for comment. Race Communications has said it would hold a town hall once the project is approved.
The recommendation from the public utilities commission has been on hold since July, when regulators suspended the process to address public concerns. People began voicing many of those concerns after The Union reported on a July 10 deadline for public comment. No public notification for the comment period was required because Bright Fiber had no customers.
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The sale of Bright Fiber to Race requires approval of the utilities commission board. Approval also is required because terms of the grant, awarded in December 2015, have changed.
Terms of the sale between Bright Fiber and Race Communications are unknown.
The project initially called for the placement of fiber primarily underground. However, the recommendation released Monday states that costs have increased since the grant's application in 2013. The grant, plus private investment, makes the total project cost around $27 million.
"Race estimates a primarily underground installation would require a $32 million grant," the recommendation states. "To contain costs, Race proposes to revise the project so that it is a 75 percent aerial installation, relying on attaching the fiber to existing utility poles."
According to the document, Race has certified it has the money needed for the 40 percent private investment portion of the project.
Race also has said it won't need a $500,000 loan that was included with the initial grant. The revised cost of the project is $26,811,315.
Additionally, the utilities commission recommends its board revise the project's timeline.
A two-year timeline usually starts once a California Environmental Qualification Act review occurs. The utilities commission exempted the project from that review on May 11, 2017, meaning the project must reach completion by May 2019.
The recommendation suggests extended the deadline to May 2020.
"Since the commission approved the Project's CEQA exemption in May 2017, the grantee (Bright Fiber) has not submitted permit applications to the appropriate state and local agencies and performed almost no additional engineering work," the recommendation states. "Race also has informed staff that it already conducted its own engineering work on the project and that the company expects to submit permit applications shortly after the transaction's approval."
Bright Fiber applied for the grant in February 2013 from the California Advanced Services Fund Infrastructure Account. In December 2015, Bright Fiber learned it would receive the over $16 million grant, along with a $500,000 loan, to complete the first of three projects that would bring a gigabit high-speed internet connection to Nevada County.
The first stage includes almost 2,000 homes along Highway 174.
Paul, Bright Fiber's owner, needed to secure over $10 million in private funding. Paul has said that a San Francisco company assured him of the investment. However, after a series of CEOs filtered through his company, and the realization that investment from the Bay Area company wouldn't happen, Paul decided in December 2017 to find someone who could shoulder the project, he's said.
According to Paul, he connected with Race Communications. They began discussions which paused when another company expressed interest. Time constraints stopped those talks, and Paul again contacted Race and accepted its offer.
The sale process again paused in July, this time when the utilities commission opted to examine a handful of public comments it received.
Public opposition focused on bringing the project above ground, the $119 down payment some prospective customers already have paid and an argument that people had inadequate public notice to lodge protests.
Race has said the above-ground infrastructure is necessary, that the $119 payments will be applied to the first month's bill — or get refunded if requested — and that all public notification requirements were met.
"Finally, if the commission does not approve Race acquiring and continuing to operate Bright Fiber, it risks the project not being completed," the recommendation states.
To contact Staff Writer Alan Riquelmy, email firstname.lastname@example.org or call 530-477-4239.
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