City Council Passes IRU, Maintenance Agreements with I3 For Citywide Broadband

By Benjamin Cox on August 11, 2020 at 8:07pm

The City of Jacksonville passed some of the final stages of agreements to get a citywide broadband project moving forward.

At a special council meeting last Monday night, the city approved a $2.5 million investment by the city and a memorandum of understanding with the company I3 to bring fiber optic broadband Internet to the door of every home in the city if purchased.

This Monday night, the city council finalized a build out timeline for the project, an agreement for the city’s free usage at public buildings, and a maintenance agreement. City Attorney Dan Beard explained what’s called Indefeasible right of use that the city agreed to Monday night: “What we were able to negotiate [with I3] was either obtaining some sort of right of first refusal or including language in the contract that would pay the city liquidated damages if I3 doesn’t meet certain dates for construction deadlines; and I thought, and I think the council agreed that it would be much better to have those construction deadlines met with monetary penalties if they weren’t met, rather than push at this stage for some sort of right of first refusal for the city to be able to buy the entire system somewhere down the road should I3 ever decide to sell it.”

Beard says that if I3 were to sell the system down the line, they would have to give the city a 60-day notice to look over the agreement to pursue any changes. Beard said during the meeting that cost of the entire project could possibly reach between $18-$20 million dollars.

Alderman Brandon Adams made two motions that died due to a lack of a second to try and amend the agreements. The first was a motion to postpone the approval of the agreements. Adams said he would like to have a third-party engineer to look over the agreements prior to having them approved. The second was to shorten the number of years that I3 would be required to provide maintenance on the system. The agreement was written for 20 years. Adams asked if the agreement could be shortened to 10 or even down to possibly 6 years.

Beard says that the rest of the council opted for the longer term agreement: “I3’s agreement is that they will maintain the system at their expense for the next 20 years. Alderman Adams was questioning whether it would be necessary to make it a shorter period for the maintenance agreement so that [the council] would have a chance to review it somewhere down the road. I think that what [the majority] of the council felt is much more important to lock I3 into a long-term maintenance agreement with the idea that any time there is an issue, the council can always go back and address it with I3 at that stage rather than cutting the agreement into much shorter increments.”

The agreements passed the council 9 to 0 with Adams voting present on the item. Beard told the council last night that I3 has also agreed to allow the city to defer the first installment of the $2.5 million payment on the agreement to February 1st, 2021; and then, the second installment would be paid once the system is completed sometime late next year. Under the agreements that were approved Monday night, I3 will have to have at least 600 residences connected to their network by the end of this year or face a monetary penalty.