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PUD Could Decline 25 Million Dollar Federal Fiber Grant

August 17, 2010

Should Chelan County PUD decline an offer

of 25 million dollars in Federal Funds to expand the Utility's Fiberoptic Network into more remote parts of the

County? Commissioners were cautioned at their Monday Meeting that there may be too many strings attached to the

grant funding to make it financially or even legally possible.

John Smith, the PUD’s managing director

of Engineering and Technology, told commissioners
the PUD would be obligated to match 25 percent of the grant

in order to receive the funding.
That would be $8.3 million. He also said extending lines and equipment to

reach
approximately 6,800 more customers would have to be done within three years – requiring a
logistics

plan capable of spending nearly $1 million a month for that time. There are legal questions that could also stand

in the way. For instance, the PUD cannot pledge future revenues as collateral. In addition, the federal program

wants a PUD pledge to operate the system that’s built with the funds for the next 22.4 years.

Commissioner

Dennis Bolz asked what might happen if the technology changes . .click above for comments

Commissioner

Norm Gutzwiler said he has a lot of concerns about the pace of the
build-out and told staff he was glad they

are going through the grant requirements with a
fine-tooth comb.

Further details of the grant’s legal

requirements and potential long-term impacts on PUD
finances will again be discussed during the board’s

regular meeting at 1 p.m. next Monday
(Aug. 23). Results of a customer survey will also be presented.

Commissioners will hold a special meeting for additional public comment on the grant at 5:30
p.m.

Tuesday, Aug. 24, at the Confluence Technology Center. No decision will be made by the
board that night.

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