Wicked Broadband pulls request for $300,000 loan guarantee

A request for the city to provide a $300,000 loan guarantee to Wicked Broadband is now off the table, but so too is a project that would bring super-fast broadband service to downtown or parts of East Lawrence.

Joshua Montgomery, co-owner of Lawrence-based Wicked Broadband, surprised city commissioners on Tuesday by pulling his request for a $300,000 loan guarantee. Montgomery had been seeking various loan guarantees or grants from the city for more than a year to spur a pilot project that would bring gigabit Internet service to downtown and parts of East Lawrence.

Montgomery on Tuesday offered commissioners a compromise: He would pull his request for the loan guarantee, but continue to seek an annual waiver of $20,000 in franchise fees that would be due to the city, and an agreement that gives Wicked more ability to make its own splices into city-owned fiber optic cable rather than being forced to hire a third-party contractor.

Without the loan guarantee, Montgomery said, the company would alter its gigabit plans. Instead of targeting about 300 addresses in the downtown area, Montgomery said he would now focus on a smaller area just east of Ninth and Iowa streets and an area near Clinton Parkway and Wakarusa Drive where Montgomery lives.

It wasn’t clear how many homes may have access to the gigabit service — which would offer the same speeds as the Google Fiber project in Kansas City — but Montgomery said it would be a significantly smaller project than the downtown plan that could have provided service to 300 addresses. Montgomery declined to answer questions about the new project following Tuesday’s meeting.

Commissioners stopped short of approving the new compromise plan but directed staff members to draw up documents that would allow the plan to be approved at a future meeting.

“I appreciate you bringing this compromise forward because I don’t want to see you leave the community,” City Commissioner Jeremy Farmer said. “You are going to do great things, and I don’t want to see you do them somewhere else.”

City Commissioner Bob Schumm, though, said he was confused about how Montgomery could suddenly drop the loan guarantee request after he had spent months arguing that the guarantee was vital to the company’s plan. But Montgomery said by reducing the scope of the pilot project, it is now possible for the company to internally fund the construction rather than rely on a bank loan.

Montgomery’s new proposal came after a tumultuous week in which he sent an email to Schumm and City Commissioner Terry Riordan that alerted the two commissioners who are up for re-election that Montgomery was organizing a bloc of about 1,200 voters who would have the fiber project as their top issue in the upcoming elections. Schumm and Riordan publicly called Montgomery out on the tone of the email. Montgomery then asked Schumm and Riordan to recuse themselves from any future votes on the Wicked matter. Both refused. The email dispute did not come up at Tuesday’s meeting.

Montgomery said he likely would have the pilot project operational by the summer and then measure results for about a year before deciding whether to raise equity funding to do additional gigabit projects in Lawrence. Farmer expressed optimism that the community may be in a better position to provide assistance for future gigabit projects, if Wicked proves it can deliver in these two neighborhoods.

Plans for Baldwin City-based RG Fiber to bring gigabit service to parts of Lawrence also remained alive at City Hall, but commissioners stopped short of finalizing them. The company hopes to provide service to several areas of Lawrence as it brings fiber through the city in route to Baldwin City. But the company is seeking to lease some existing city-owned fiber to supplement its network. Commissioners deferred a vote on the policy that would allow for such leases. It wants to receive additional opinion from a consultant on how the policy should be structured.

Mike Bosch, an owner of RG Fiber, said the company still hopes to do a project in Lawrence but is exploring alternative routes for its fiber that would bypass Lawrence because RG is committed to launching gigabit service in Baldwin City this spring.

In other city commission news, commissioners unanimously approved a contract with Kansas City-based el dorado inc. to begin doing design work and community outreach on a proposed arts corridor for a portion of Ninth Street east of Massachusetts Street.