Most Utahns probably agree that government should stick to essential government services and stay out of enterprises that are better performed by the private sector.

Yet, across the country and right here in Utah, more and more governments are building government-owned internet networks, despite numerous private-sector providers being available.

The number of government-owned networks is increasing by the day, and taxpayers, not users, are often footing the bill. Government-owned broadband networks cost millions of dollars and divert essential funding away from services that really matter to the public — services such as police and fire, roads, water and sewer.

Two unfortunate examples of government-owned broadband networks right here in Utah are iProvo and UTOPIA.

In 2004, Provo City launched iProvo to provide broadband internet services to homes and business. Provo reportedly bonded for $36.5 million to bring service to every home in the city and wrote off $5.4 million that the city’s telecommunications fund owed the Energy Department’s reserve fund to finance the costly deployment. After struggling to make the network viable, iProvo was sold in 2008. But its buyer failed to fulfill the terms of the sale, and iProvo reverted back to the city. In 2013, in a desperate attempt to free itself of the failed venture, the city ultimately sold iProvo to Google for $1.

Similarly, UTOPIA (Utah Telecommunications Open Infrastructure Agency) was launched to provide broadband internet services to a consortium of cities. But UTOPIA has failed to fulfill its promises for more than two decades now. The project, which started in 2002, was projected to be finished in three to four years. Fast forward to today, and it is still incomplete. Not only is UTOPIA incomplete, but the project has racked up $300 million worth of debt. And despite iProvo’s example of failure, UTOPIA continues to expand.

For years, UTOPIA consistently lost money, expecting taxpayers to cover those losses. In addition to this, the government-owned network continues to expand and pull other cities into this trap. What’s more egregious is that UTOPIA misrepresented its performance as it pitched cities on buying into the expansion fever. For example, UTOPIA once claimed the network had “no cost to taxpayers since 2009.” This statement was patently inaccurate.

As your watchdog, I help you to hold your government accountable. My office investigated this and other claims, then we wrote a letter identifying these inaccurate statements. We instructed UTOPIA to do the following:

  • Discard or destroy marketing materials with misleading statements.
  • Ensure future communications more accurately reflect the dependence on taxpayer support.
  • Take steps to remedy the misrepresentations regarding the lack of taxpayer support to any individual or entity that received the inaccurate information.

UTOPIA’s shortcomings do not stop there, however.

Rather than providing internet access to the more than 40,000 homes and small businesses that lack internet access today, UTOPIA, like other government-owned networks, builds redundant networks that compete with existing private providers, many who are also regulated by the cities in which they operate.

Unfortunately, iProvo and UTOPIA are no different from other government-owned fiber networks across the country, which fail financially about 90% of the time.

When taxpayer money is being diverted from critical services into pet broadband projects, that money is not going where it is needed most. Taxpayers expect government to maintain roads, provide safe drinking water and keep their communities safe. Money spent propping up broadband services costs taxpayers money, encumbered by decades of debt, and deprives them of important and sufficient government services they want and deserve. Plus, higher taxes burden families, many of whom are struggling today just to provide for themselves.

Government-owned broadband has done enough harm to taxpayers. iProvo and UTOPIA should be seen as an example for policymakers of what to avoid. Public officials across the country, and especially here in Utah, should resist the appealing allure of expanding or deploying government-owned networks, which allure has been shown to be deceptive, and ultimately destructive, to taxpayers.

John Dougall is the Utah State Auditor and is a candidate for Utah’s 3rd congressional district.