HomeMy WebLinkAbout8. A1 RES 45761
Commission Memorandum
REPORT TO: Honorable Mayor and City Commission
FROM: Brit Fontenot, Economic Development Director
David Fine, Economic Development Specialist
SUBJECT: Resolution 4576 Adopting the Bozeman Fiber Master Plan and Feasibility Study and Provide Policy Direction to Staff on Incorporating
Elements of the Bozeman Fiber Master Plan and Feasibility Study into
the Downtown and North 7th Avenue Tax Increment Finance Districts'
Urban Renewal Plans and the City's Growth Policy.
MEETING DATE: January 26, 2015
AGENDA ITEM TYPE: Action
RECOMMENDATIONS: 1. Approve Resolution 4576 adopting the Bozeman Fiber Master Plan and Feasibility
Study;
2. Direct Economic and Community Development staff to return to the Commission with
proposed ordinances amending urban renewal plans of the Downtown and North 7th Tax Increment Finance Districts to facilitate fiber deployment within the TIF districts; and
3. Direct Economic and Community Development staff to return to the Commission with a
proposed growth policy amendment incorporating elements of the Bozeman Fiber Master Plan and Feasibility Study into the City's Growth Policy.
THREE SUGGESTED MOTIONS:
1. Having considered all materials, written and spoken public comments, and
recommendations of staff, I move to approve Resolution 4576 adopting the Bozeman Fiber Master Plan and Feasibility Study and direct staff to immediately proceed with implementation planning and engineering for Phase I with a goal of constructing Phase I in summer 2015 and direct staff to continue collaborating
with the Bozeman Public Schools and private financing partners to fund the
construction of Phase II. AND
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2. I move to direct Economic and Community Development staff to return to the
Commission with proposed Ordinances amending the urban renewal plans of the
Downtown, North 7th Tax Increment Finance Districts to facilitate fiber deployment within the TIF districts; AND
3. I move to direct Economic and Community Development staff to return to the Commission with a proposed Growth Policy amendment incorporating elements of the Bozeman Fiber Master Plan into the City's Growth Policy.
BACKGROUND:
In May 2013, with the support of the Bozeman City Commission (Resolution 4434) the City established the Broadband Steering Committee (BSC). The BSC is composed of technology
sector professionals, economic developers, telecommunications industry professionals, financial
services professionals and local government officials. Since July 2014, members of the BSC
have been working with Design Nine, a nationally recognized broadband planning firm to, in the
words of Commission Resolution 4434, “bring fast, reliable, and affordable broadband service to Bozeman and the region in furtherance of the City’s economic development goals.”
The project team, convened by the City of Bozeman, the Broadband Steering Committee,
and the Economic Development Council, was tasked to explore the feasibility of developing a
community-owned, high-performance broadband network for Bozeman.
On December 15, 2014, the City Commission received the Bozeman Fiber Initiative
Project Overview report, which provided a summary of the project and its recommendation to
create an open-access network managed and operated by a “locally controlled, independent,
private sector entity”. The Commission voted 4-0 to “direct Community and Economic Development staff to return to the Commission with a proposed Bozeman Fiber Master Plan.”
SUMMARY OF RECOMMENDED ACTIONS:
1. Adopt the Bozeman Fiber Master Plan and Feasibility Study. The Bozeman Fiber Master Plan and Feasibility Study recommends building three
phases of an open access community fiber optic network. With an open access network, the City
will not be an internet services provider to businesses and residents; these services will be
provided by the private sector. Revenue for the network will come from private service providers using the shared infrastructure created by the network to reach and compete for new customers. The cost of each phase is estimated as a standalone project, but significant savings may be
realized by building phases together. Phase I and Phase II will, ideally, be constructed
concurrently even though their engineering and funding may occur separately.
Phase I includes a fiber build in two tax increment finance (TIF) districts. The Montana
Code Annotated (7-15-4288 MCA) specifically includes “telecommunications lines” as “public
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improvements or infrastructure” that may be built with TIF money in an urban renewal area.
Phase I was developed to utilize TIF funds to improve the infrastructure in the Downtown and
North 7th Avenue TIF districts and enhance the desirability of those districts for redevelopment
and renewal. Staff recommends that the City Commission direct staff to immediately proceed with implementation planning and engineering for Phase I with a goal of constructing Phase I in
summer 2015. Building Phase I summer 2015 is essential to meeting the needs the schools will
have in summer 2016.
Phase II includes a fiber build to the Bozeman Public Schools. The schools are a large
user of fiber services and since they are geographically dispersed they allow the network build to
reach larger areas of the community and additional business districts. Staff expects that a
combination of funding from Bozeman Public Schools and private financing will fund construction of this phase.
Staff recommends that the City Commission direct staff to continue collaborating with
the Bozeman Public Schools and private financing partners to fund the construction of Phase
II. Coordinating to construct Phase I and Phase II concurrently may produce significant savings.
Phase III includes closure of rings to reinforce the reliability of the network and includes
expansion into additional business districts. Staff expects that a combination of private financing
and revenue from network operations may finance construction of Phase III. 2. Direct Community Development and Economic Development staff to return to the Commission with proposed Ordinances amending the Urban Renewal Plans of the
Downtown and North 7th Avenue Urban Tax Increment Finance Districts
The Montana Code Annotated (MCA) allows tax increment to be used in an urban renewal area for activities listed in 7-15-4288 MCA “as identified in the urban renewal plan.”
Staff believes that current urban renewal plans for Downtown and North 7th Avenue provide
broad direction to promote commercial activities and make infrastructure improvements within
the respective districts. Nevertheless, we recommend amending the urban renewal plans for these districts to promote transparency and public participation in government and to provide clear
direction that this project contributes to the redevelopment and renewal goals of these districts.
3. Direct Community Development and Economic Development staff to return to the
Commission with a proposed Growth Policy amendment incorporating elements of the Bozeman Fiber Master Plan and Feasibility Study into the City's Growth Policy.
The Bozeman Fiber Master Plan is clearly supported by the goals and objectives enumerated by
the Bozeman Community Plan.
• Goal ED – 1.1: Support business creation, retention, and expansion. Emphasize small
businesses, ‘green’ businesses, and e-businesses.
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• Goal ED – 1.2: Coordinate the provision of infrastructure necessary to support economic
development.
• Goal ED – 1.6: Utilize the City’s economic development and urban renewal plans to
stimulate investment and maintain a healthy and vibrant economy.
Long-term planning to support the continued development of next-generation fiber optic infrastructure would benefit from additional clarity of direction. Staff recommends amending the text of the Public Services section of Bozeman Community Plan to specifically address fiber
optic infrastructure. Preliminary draft language for such a text amendment is provided in the
appendix of the Bozeman Fiber Master Plan and Feasibility Study.
UNRESOLVED ISSUES:
The structure of the partnership with the managing non-profit entity is still being
developed. Staff plans to return with a suggested legal structure and agreement(s) for
consideration by the Commission in the coming months. Also, staff is still planning a funding strategy for constructing Phases II and III of the Bozeman Fiber Master Plan.
ALTERNATIVES: As determined by the Commission.
FISCAL EFFECTS:
The following preliminary cost estimates project the cost of building each phase as a
standalone project. For Phase I, $325,000 of the $1.44 million cost would be expended in FY
2015. The board of the Downtown TIF included $100,000 for the fiber project in their FY 2015 workplan and budget and the North 7th Avenue Urban Renewal Board (NSURB) recently voted to amend their workplan and budget to include $100,000 for engineering and project
management for Phase I (A forthcoming budget amendment proposal to be presented to the City
Commission for approval). These funding streams, together, would provide adequate funding in
Fiscal Year 2015 for the “implementation planning phase” of the Phase I build. Phase I, additionally, utilizes a $125,000 existing City project (budgeted for FY 15) to connect City Hall to the Water Shops and County Emergency Operations Center along Montana Street. Funds from
the two TIF districts and the Montana Street Project would comprise the majority of the Phase I
funding.
Phase Cost Estimate Fiber Construction
Phase I – Fiber to the TIF Districts estimated $1,440,466 7 miles
Phase II – Fiber to the Schools estimated $1,474,817 11.05 miles
Phase III – Ring Closure and Network
Expansion
estimated $1,233,368 10.31 miles
All phases estimated $4,380,152 29.14 miles
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Attachments:
1. Resolution 4576;
2. December 15, 2014 Packet Material (hyperlinked here only);
3. Bozeman Fiber Master Plan and Feasibility Study (hyperlinked here only);
4. Minutes of the December 15, 2014 City Commission meeting including public comment (hyperlinked here only); and
5. Letters of support (hyperlinked here only).
Report prepared on January 19, 2015
RESOLUTION NO. 4576
A RESOLUTION OF THE CITY COMMISSION OF THE CITY OF BOZEMAN,
MONTANA, ADOPTING THE BOZEMAN FIBER MASTER PLAN AND FEASIBILITY
STUDY.
WHEREAS, the Bozeman City Commission identified economic development as a
high priority; and
WHEREAS, the Bozeman City Commission supports efforts to strengthen the
economic vitality of Bozeman and the surrounding area; and
WHEREAS, the Bozeman City Commission acknowledges that the facilitation of job
creation and industry diversification are critical to the long-term economic success of Bozeman;
and
WHEREAS, the Bozeman City Commission wishes to stimulate, encourage and
support the attraction, retention and growth of high-value industries and mid- to high paying jobs
in a variety of sectors; and
WHEREAS, the City of Bozeman’s Economic Development Council discussed and
acknowledges the importance of fast, reliable, affordable and redundant broadband internet
service to Bozeman is to accomplishing the aforementioned goals of the facilitation of job
creation and industry diversification; and
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Resolution 4576, Adopting Bozeman Fiber Master Plan and Feasibility Study
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WHEREAS, the Bozeman City Commission adopted Resolution 4434 supporting the
efforts by the Broadband Steering Committee to bring fast, reliable, affordable and redundant
broadband internet service to Bozeman; and
WHEREAS, the Broadband Steering Committee determined that the lack of
affordable, reliable, redundant and high-speed broadband internet service in the region is a
limiting factor in Bozeman’s economic growth; and
WHEREAS, the Bozeman Community Plan promotes and encourages the continued
development of Bozeman as a vital economic center; and
WHEREAS, the Bozeman Community Plan supports business creation, retention, and
expansion with emphasis on small businesses, ‘green’ businesses, and e-businesses; and
WHEREAS, the Bozeman Community Plan supports coordination in the provision of
infrastructure necessary to support economic development; and
WHEREAS, the Bozeman Community Plan supports utilizing the City’s economic
development and urban renewal plans to stimulate investment and maintain a healthy and vibrant
economy; and
WHEREAS, the Bozeman Community Plan supports balanced policies and programs
to encourage a durable, vigorous and diverse economy; and
WHEREAS, the Bozeman Community Plan supports working with other service and
utility providers to ensure the adequate and safe provision of services; and
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Resolution 4576, Adopting Bozeman Fiber Master Plan and Feasibility Study
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WHEREAS, the Bozeman Economic Development Plan supports the expansion and
retention of existing businesses and economic sectors that will continue to strengthen and
diversify the economy and create higher paying jobs in Bozeman and the surrounding area; and
WHEREAS, the Bozeman Economic Development Plan supports maintaining and
upgrading infrastructure to support current and future needs of business; and
WHEREAS, the Bozeman Capital Improvement Plan supports anticipating future
service demands and resource deficiencies and be proactive in addressing them; and
WHEREAS, the Bozeman Capital Improvement Plan supports the provision of
excellent and equitable public services which are responsive to the community within available
resources; and
WHEREAS, the Downtown Bozeman Improvement Plan supports the coordination of
infrastructure improvements critical for development and redevelopment in the downtown core;
and
WHEREAS, the North 7th Urban Renewal District Plan supports the coordination
public and private improvements; and
WHEREAS, an open access model for delivery of broadband services will increase
competition among private internet service providers; and
WHEREAS, a shared infrastructure model for delivery of broadband services reduces
costs and creates new business opportunities for private internet service providers; and
WHEREAS, improved policies for installation of broadband infrastructure facilitates the
organic growth of an open-access fiber network; and
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Resolution 4576, Adopting Bozeman Fiber Master Plan and Feasibility Study
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WHEREAS, Bozeman has a critical mass of local government agencies, K12 schools,
colleges, health care institutions, and large and small businesses to support a financially
sustainable, open access community fiber network.
NOW, THEREFORE, BE IT RESOLVED by the City Commission of the City of
Bozeman, Montana, that:
Section 1
The Bozeman Fiber Master Plan and Feasibility Study, hyperlinked here as Exhibit A
and on file in the City Clerk’s office, is hereby adopted.
PASSED AND APPROVED by the City Commission of the City of Bozeman, Montana at a
regular session thereof on the 26th day of January, 2015.
_________________________________
JEFFREY K. KRAUSS
Mayor
ATTEST:
_______________________________
STACY ULMEN, CMC
City Clerk
APPROVED AS TO FORM:
_________________________________
GREG SULLIVAN
City Attorney
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