Facebook Twitter

iProvo sale approved

City Council votes 4-3 on the $40.6 million deal

SHARE iProvo sale approved

PROVO — Mayor Lewis Billings once told City Council members they were the ones who'd pull the trigger on whether the city would sell iProvo to Broadweave.

But Tuesday night, as the City Council voted 4-3 to approve the sale of the city-owned fiber optic network, some council members said they felt like they were on the wrong side of a rifle as they deliberated.

"Frankly, I feel like I have a gun to my head," said City Councilwoman Sherrie Hall Everett, who participated in the meeting via conference call.

The council discussed the mayor's proposal to sell iProvo — which provides voice, video and Internet — to South Jordan-based Broadweave Networks for $40.6 million, plus interest. As the council considered the measure, city staff repeatedly reminded them that the proposed 2009 fiscal budget had already factored in the sale of iProvo.

Interim telecommunications director Kevin Garlick said the city is approaching the end of the financial year, and if they decided not to sell the network then they would have to readjust the budget, which already reflected the iProvo sale, to reflect the status quo.

"We all know the status quo would be a continued need to finance the project," Garlick said.

Garlick also said the uncertain atmosphere surrounding iProvo has also led to other problems. Four iProvo employees have given him letters of resignation because they are seeking employment elsewhere, and the current service providers MSTARmetro, Veracity Communications and Nuvont have reported an extremely difficult time maintaining subscribers while the fate of iProvo is yet to be determined.

"Based on all of these issues, we would hope the council would take this recommendation," Garlick said.

Executives from Sorenson Captial, an organization that has pledged to back Broadweave as it assumes control of the network, also applied pressure to move the council's decision along.

Fraser Bullock, of Sorenson Capital, said the deal needs to be closed soon so the cloud of uncertainty can be released.

"Uncertainty creates a cloud," he said. "The longer we go ... the more problems it creates."

City Councilman Steve Turley said Sorenson Capital and Broadweave aren't the only ones operating under a cloud of uncertainty. Since they learned of the sale May 6, Turley said members of the council have been bombarded by information about the sale. He also said they had recently received additional documents detailing the sale that he hasn't had sufficient time to review.

"I want you to know there's a discomfort," he said.

City Councilwoman Cindy Richards said she doesn't feel like she's under a cloud, and she thinks all the information leading up to this point has been helpful.

"It's all been going in the same direction," she said. "There haven't been any surprises."

During the discussion, lawyers also refuted some claims that have been made by MSTARmetro executives who claimed in a letter dated May 23 that the city request for proposals, that drew the bid from Broadweave, was "closed, procedurally unfair and ... very likely illegal."

City Attorney Robert West said he's reviewed many codes and he is certain the city did no wrong doing in the RFP process.

"I would step forward and be the first one to tell you 'Please, step back and review this,"' he said, if he perceived any "inappropriate actions."

Public comment on the sale of the network was divisive. MSTARmetro's Joe Hansen, who wrote the letter calling the city process illegal, said he retracted the his objections to the RFP, and he supported the iProvo sale.

Nuno Battaglia, of Prospera360, said he still thought the RFP issued by the city was disingenuous because it did not specify the city was open to the possibility of a sale.

Provo resident Jim O'Neal said he thinks the sale is a big mistake. He said it's a good deal for Broadweave and it's a good deal for the city, but it isn't a good deal for the residents.

"When they find out, next election, it won't be a good deal for you," he said to the City Council members.

Before a vote was called, Turley said he's excited to be rid of iProvo, but he won't vote for it because he feels the process was compromised.

"I really want this iProvo nightmare to end," he said. "I really want this to become someone else's sweet dream."

Before he voted, City Councilman George Stewart said he never would have voted in favor of iProvo five years ago if he were on the council. He said the system has cost the city $13.5 million, and it would cost about $15.6 million over the next five years if they don't approve the sale.

"That's substantial money," he said.

The council voted 4-3 to approve the sale. Turley, Everett and City Councilwoman Cindy Clark were the dissenting votes.

E-mail: jdana@desnews.com