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Hello,
-We operate under MGL Chap 164 successfully, no legal problems or pushback, as a broadband-only MLP. Several other towns do as well throughout the state (Leverett, New Salem, Wendell just to name a few)
-Caveat is the broadband-only operations have only been done in very small towns to date that I know of. Not sure if incumbent private providers will make challenges when much larger towns like yours start up MLPs that risk their profits, but there is a solid precedent for broadband only MLPs in our state.
-Note that Westfield, Holyoke and South Hadly all run electric in their towns already. Creating a fiber network on poles you already own is not a problem at all. See more on why it is so hard when you don’t own the poles below.
-Our legal challenge was to try to get the annual pole bond (ie pole insurance) removed for MLP entities. We tried to argue that MLPs are different from private providers because we are backed by tax base and therefor unlikely to go bankrupt and abandoned equipment that would then need to be removed. We lost this appeal.
Overview explaining the challenges of hanging fiber on poles you (your town) doesn’t own:
All 1508 utility poles in our town are joint owned by National Grid, Eversource, and Verizon. So, after submitting costly applications to each of these companies we had to wait for them to move the equipment and wires in order to make room for our fiber. They are legally obligated to do this for any provider, public or private, that requests it.
The process involves submitting an application, waiting for the utility companies to evaluate every pole, give you an estimate for the work. They submit an invoice and you pay for all of the “make ready” work and then finally they got around to actually doing the work, granting your license, and only then can you begin construction. After the work is done, you pay more if the work exceeds their original estimates. But you also receive a refund if it is less (rarely!). This is known as the “true-up” process.
It took almost two years and cost over $1 million to complete the entire make-ready process. It cost more to do the make-ready work than it did to construct the network’s mainline. It accounted for about 1/3 of the total project costs. In some case you pay to “upgrade” the utility network because they need to install a taller or better pole to support your equipment. It is a frustrating and expensive process but unless you want to do a wholly underground network or install your own pole network, it’s the best we have.
Best,
-Gayle
Gayle Huntress
MLP Manager, Town of Shutesbury
413-887-8505 (Direct)
For 24/7 Customer Service please call: 855-415-7592