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March 22, 2011

No more free ride . . .That is essentially the message being conveyed by Chelan County PUD to

Wenatchee area fiber customers. In an effort to rein in expenses the PUD is planning to impose a cap on the cost

of extending fiber service to homes and businesses. Steve Hair reports . . .

If adopted, the

proposed change in policy would establish a 15-hundred dollar cap on the District’s share of the costs of hooking

up . End users would have to cover anything over and above that. PUD General Manager John Janney told

Commissioners at their Monday meeting that the networks program is losing about 8 million dollars a year and,

Without the changes, he says it’s doomed as a business model

A long term strategic plan on the fiber

program continues. Officials have been reassessing the fiber program’s finances after two of its former managers

were fired last month for failing to provide accurate cost estimates relating to the network build-out.

The build-out continues through a federally funded 25 million dollar grant which electric customers match

with a 2 percent rate increase. But Commissioner Dennis Bolz wonders if accepting the grant was a mistake. He and

Commissioner Carnan Bergren expressed concerns that prior to accepting the Federal grant there had not been any

estimates of costs relating to the replacement of power poles when extending fiber service through overhead

utilities
Meanwhile, the scrutiny over the fiber program finances intensifies. 10 years into the build-out

there’s increasing concern about looming costs of upgrading outdated or obsolete equipment. The PUD has to date

invested 110 million dollars into the networks program with nothing but red ink to show for it.

For their

part, Local Internet Service providers say they continue to sign up new customers. But Demetri Mandelas with

LocalTel is worried that under the proposed policy change residential users facing additional hookup charges Will

likely opt for a cheaper option. . ..

Commissioners will take final action on the plan at their

Monday afternoon meeting next week.

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