December 7, 2017
Last week, this blog reported that Burlington, Vt. is very close to finalizing the sale of its municipal broadband network.
This week, a network in Florida is on the auction block. According to Government Technology, Leesburg, Fla. “has reached agreement with a broadband company to sell its fiber-optic utility for $7.25 million.” Summit Broadband is the buyer working with the city.
Leesburg has provided fiber optic service since 1993 and the city budgets about $2.2 million for the system annually. The city decided to sell the network because, while it was generating revenue for the general fund, the amount wasn’t that much—only $100,000 thanks to a highly competitive environment. (There are 10 residential providers in Leesburg, with two providing service to at least 94 percent of residents.) Under the deal, the city will still provide fiber service to its own offices.
City Manager Al Minner said “Fiber optics is not really a core business for us.”
In July, city officials had said they would need to invest more money into the network “to stay competitive” and also noted that other utilities brought in “an excess of 10 percent to the general fund, plus money for capital improvements.”
The city is hoping to use the $7.25 million in revenue it will generate from the sale for economic development projects. Mayor Bob Bone called the agreement “great opportunity for the city of Leesburg.”
Summit Broadband, a private provider, already serves thousands of business and residential customers in Florida.
Leesburg’s municipal fiber utility employs six people. According to Government Technology, those individuals “will either be relocated to other city jobs or become employees of” Summit Broadband.
The deal with Summit should be finalized by the end of January.
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