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RS Fiber Project is focus of joint board meeting

October 9, 2012
By Fritz Busch - Staff Writer , The Journal

GAYLORD - Commissioners from Sibley and Renville county boards will meet jointly to discuss RS Fiber project issues at 1 p.m. today in the commissioners room at the Courthouse in Gaylord.

Both county boards recently tabled action on bonding resolutions for a joint fiber project designed to create high-speed online service and state-of-the-art telephone and television service.

On Sept. 25, Sibley County commissioners tabled a resolution to bond for the project, citing lack of information on legal and financial details about it.

Project proponents in Sibley County say the project has the support of more than 55 percent of survey respondents, more than 80 percent of respondents in three townships and 70 percent in a few others.

The project has been approved by most cities in both counties. The City of Arlington pulled out of the project last winter.

Bonding, estimated at $70 million or more for the two counties for the publicly-financed, privately-managed project, would be repaid with user fees, project proponents say.

Fact Box

If you go

Who: Public meeting

What: Joint session of Renville and Sibley county commissioners

Why: To discuss the RS Fiber project

When: 1 p.m., today

Where: Commissioners Room, Sibley County Courthouse, Gaylord

Financial issues discussed at the last Sibley County board meeting include who would pay for the project's legal costs plus cash flow analysis figures.

Legal questions according to some Sibley County commissioners include whether the counties are authorized by law to do the project.

Shannon Sweeney of David Drown Associates of Waconia, representing Sibley County, said legal opinions on the project may continue to remain and that commissioners may have to decide whose legal opinions they value the most.

Sweeney said it would take about a month to set the project's bonding interest rate after bonding was approved.

Earlier this year at an RS Fiber Joint Powers board meeting, Winthrop Mayor Dave Trebelhorn said the Joint Powers Board would hire a system operator to manage the fiber network, if it becomes reality.

This summer, Winthrop resident Dale Malheim circulated a petition seeking a referendum vote on whether public money should be used for the project.

Malheim said he thought he had enough petition signatures for a referendum vote, but the City of Winthrop did not put the question on the November general election ballot. Malheim is running for mayor.

At a recent RS Fiber joint powers board meeting, Winthrop City Administrator Mark Erickson said state law requires municipal government to have referendum approval to operate a telephone exchange but that the Sibley-Renville County project does not need referendum approval because counties are involved and RS Fiber will use an existing phone switch owned by Winona-based Hiawatha Broadband Communications.

Erickson said fiber projects built with federal grants and loans in Windom and Lake County did not need referendum approval for telephone authority.

Project risks are small compared to the potential for big benefits including multiple services for counties, schools, businesses and industries, Erickson said.

Comparing the Renville-Sibley County fiber project to one in Monticello that included a referendum vote is not accurate because a local provider built fiber to compete, resulting in a revenue loss and lawsuit over bond payment issues for the City of Monticello's fiber project, Erickson said.

He added that because of the size of the Renville-Sibley County project, he did not feel it was likely another provider would build a fiber network to compete with it.



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