Item #05
Date: April 5, 2022
To: Mayor and City Council
From: Jim Schaad, City Manager
Subject: Deployment of a Citywide Fiber Optic Network with SiFi Networks Marysville, LLC Recommendation:
Pass a Motion to adopt a Resolution 2022-XX authorizing the City Manager to enter into a Right-of-Way Access and Use Agreement for deployment of a Citywide fiber optic network with SiFi Networks Marysville, LLC.
Background:
SiFi Networks is an international fiber optic network developer that funds, builds and operates state-ofthe-art community wide networks enabling Internet Service Providers (ISPs) to deliver dozens of next generation applications including superfast internet, video and phone. SiFi Networks has established agreements with multiple municipalities throughout the country to implement networks within those communities. Participating agencies within California include Rancho Cordova, Pittsburg, Lancaster, Palmdale, Fullerton, Placentia, and Simi Valley.
SiFi Networks approached the City of Yuba City several months ago regarding the possibility of implementing a network within Yuba City. Yuba City Public Works Staff researched the merits of entering into a Right-of-Way Access and Use Agreement to allow SiFi Networks to develop and install fiber optics network within their city and recommended such an agreement to Yuba City’s Council. The Yuba City Council unanimously approved the agreement on 9/7/2021.
SiFi Networks has since approached the City of Marysville to provide a state-of-the-art community wide fiber optic network similar to the network to be installed in in Yuba City. The company would not be able to provide this opportunity as a stand-alone project to the lower populated City of Marysville due to economies of scale. However, SiFi Networks can provide the network to Marysville if it is completed concurrently with Yuba City’s project.
It would be the intent of the City and SiFi that all residents, businesses, and City facilities will have access to the System. SiFi will own and maintain the backbone infrastructure, and they will lease the fiber lines to ISPs that will in turn offer data service to customers. Residents and businesses will have options in that they can maintain their existing ISP or seek subscriptions with providers who have leased fiber from SiFi.
Discussion & Analysis:
The attached Right-of-Way Access and Use Agreement (Agreement) outlines the terms for SiFi to install the fiber optic network within the City’s right-of-way. Highlights of the Agreement are as follows:
Item #05
• Term – Initial term is 30 years and may be renewed for additional terms of 15 years each upon approval of a written amendment to the Agreement.
• Efficient Permitting Process – SiFi will pay the City up to $60,000 per year to assist with the review and processing of SiFi’s permit applications.
• Other Third-Party Agreements – The City shall not solicit or accept offers from, or enter into an agreement with, any third party regarding a fiber to the premise system within the City’s boundary until after the first anniversary of the Effective Date. • Construction – Slot cut micro trenching will be allowed for the installation of the fiber optic network within the City right-of-way.
• Maintenance – SiFi will be responsible for the maintenance of the system. • Scope of Project – A fiber optic network will be installed throughout the City of Marysville within the public right-of-way passing all available premises within the City. • Timing of Project – SiFi will use commercially reasonable efforts to commence construction on or before a date that is twenty-four (24) months after the execution of the Agreement, and complete construction on or before a date that is thirty-six (36) months after the construction commencement deadline.
The Agreement does not prevent other service providers from installing their own citywide fiber optic networks or expanding their existing fiber infrastructure and providing a similar service. Existing ISPs may continue to provide services to the City. Staff has verified through outside legal counsel that if existing and/or new providers lease capacity from SiFi that typical franchise fees will still be applicable.
Staff has also had discussions with SiFi regarding the potential to install a closed-loop municipal fiber system for the City’s exclusive use to interconnect each City-owned facility and allow the City’s entire computer network to communicate via this interconnected system. More analysis will need to be completed to determine this is will add value and is cost-effective for the City.
Alignment with City Goals:
Staff recommends implementing the Agreement with SiFi as a privately funded and managed citywide fiber network aligns with Council’s goals for Infrastructure and economic Development and is a significant opportunity for strengthening the City’s ability to retain and attract businesses, jobs, and private investment.
Fiscal Analysis:
There is no cost to the City for the implementation of this system in that it is privately funded. SiFi Networks Yuba City LLC will pay the City up to $60,000 per year to assist with the review and processing of SiFi’s permit applications.
Attachments:
1) Right-of-way access and use agreement
2) Resolution 2022-XX