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Fort Collins, Colo. Municipal Utility Ballot Language Lives Through Legal Challenge

| Written by Matthew Marcus | No Comments | Updated on Oct 2, 2017 The content that follows was originally published on the Institute for Local Self-Reliance website at https://ilsr.org/fort-collins-colo-municipal-utility-ballot-language-lives-through-legal-challenge/

The Fort Collins’ ballot measure that could amend the City Charter allowing high-speed Internet to become a municipal utility moves forward after a short legal scuffle. The question will be decided at the November 7th special election.

Failed Legal Petition

After the language of the ballot question was released following approval by City Hall, local activist Eric Sutherland filed a petition with Larimer County. Sutherland — well known for his numerous petitions wagered against the city, county and school district— claimed that the language “failed to consider the public confusion that might be caused by misleading language”. Sutherland also insisted the proposed City Charter Amendment isn’t legal under the Taxpayer’s Bill of Rights (TABOR) amendment to the State Constitution. TABOR requires local governments to get voter approval to raise tax rates or spend revenue collected under existing tax rates.

Attorneys representing the city of Fort Collins rejected Sutherland’s claims and maintained that the amendment isn’t covered by TABOR. A utility does not require voter approval to issue debt because it is legally defined as an enterprise, a government-owned business. Moreover, Fort Collins Chief Financial Officer Mike Beckstead testified that the bonds would be backed by utility ratepayers, not tax revenue. City Council explained in a statement that they included the $150 million-dollar figure in the ballot language in an effort to maintain transparency and show the level of commitment a broadband utility could require from the municipality. By including the dollar amount in the ballot language, the Charter would also establish a limit on any debt.

District Court Judge Thomas French issued his ruling on Sept. 4th, dismissing Sutherland’s arguments regarding TABOR and explained that “there are no legal grounds to cause the submission clause to be rewritten” and finally that “the intention behind the charter amendment is not to create debt but to authorize the council to approve a new utility.” The proposed amendment will proceed as planned, narrowly making the county’s Sept. 8th deadline for certifying the November ballot.

Ballot Question 2B, to be decided at the November 7th special election, asks:

City-Initiated Proposed Charter Amendment No. 1

Shall Article XII of the City of Fort Collins Charter be amended to allow, but not require, City Council to authorize, by ordinance and without a vote of the electors, the City’s electric utility or a separate telecommunications utility to provide telecommunication facilities and services, including the transmission of voice, data, graphics and video using broadband Internet facilities, to customers within and outside Fort Collins, whether directly or in whole or part through one or more third-party providers, and in exercising this authority, to: (1) issue securities and other debt, but in a total amount not to exceed $150,000,000; (2) set the customer charges for these facilities and services subject to the limitations in the Charter required for setting the customer charges of other City utilities; (3) go into executive session to consider matters pertaining to issues of competition in providing these facilities and services; (4) establish and delegate to a Council-appointed board or commission some or all of the Council’s governing authority and powers granted in this Charter amendment, but not the power to issue securities and other debt; and (5) delegate to the City Manager some or all of Council’s authority to set customer charges for telecommunication facilities and services?

Options for the Community

Almost two years ago, Fort Collins and 46 other cities and counties voted to repeal SB 152, a 2005 law that barred local authorities from offering Internet service themselves or with a private sector partner. Fort Collins is a thriving tech town, home to approximately 160,000 residents and the University of Colorado, but like so many towns, they’ve been relegated to a couple mediocre options for cable and DSL service.

logo-nextlight-lpc.pngWith this proposed amendment to the City Charter, Fort Collins is considering different connectivity models. A public-private partnership isn’t off the table but they’ve been gleaning insights from their neighbor Longmont, who’s begun offering gigabit connectivity through their NextLight community-owned network.

Over the past few years, support from the community for reclaiming local telecommunications authority has grown in Fort Collins and all over the state. Voters in approximately 100 towns and counties have chosen to opt out of SB 152; more communities will raise the issue this fall. Some communities have taken steps to improve local connectivity but many appear to be satisfied to have preserved the option. Loveland issued an RFP for a gigabit network earlier this month and Estes Park is in the engineering phase of their project.

Fort Collins had a tentative public-private partnership in its sight a few years back, but the project never moved past early discussions. This vote will give the city the option to implement its own municipal telecommunications utility. The local debate over the high-speed Internet initiative is ongoing.

Further Deliberation

Last Thursday Colorado State University hosted a panel discussion where both sides of the debate voiced their opinions regarding the nuances of the proposed plans. Following a presentation by Tim Tillson from the Fort Collins Citizen Broadband Committee, Vice President of IT at CSU, Patrick Burns, gave a poignant firsthand perspective as to why the innovation is needed:

“I think there’s a real need for this, for us and our residents and our homes. And there’s a real need for our businesses. I have businesses coming and knocking on my door, and they do this every year, and they say we’ve got these giant data sets and we can’t get enough Internet capacity bought from anybody to upload these giant data sets. ‘You’re connected to Internet, too, aren’t you CSU? Let us just put them on your servers and then we can upload them.’ But we can’t do that because we’re not allowed to compete with the private sector.”

This article was originally published on ILSR’s MuniNetworks.org. Read the original here.