Update: Willmar, Minnesota, wants Charter Communications to undertake by March 3 on computer plan

Willmar — On Tuesday, the Willmar City Council unanimously mandated town staff to work with Charter Communications to develop a commitment to give fiber-optic services in the Willmar Industrial Park and create a schedule for increased domestic services in the rest of the city by March 3.

During the conference, a roughly hour-long conversation arose about what Charter is proposing in contrast to the city’s two-year-long research and development of the Connect Willmar Initiative, an open-access, fiber-optic system.

One of the guiding objectives of the Connect Willmar Initiative was to provide the desired amount of access to all the citizens and companies, according to City Operations Director Kyle Box.

On Tuesday, he reported on the Feb. 13 conference between representatives from Hometown Fiber, Charter, capital staff, Mayor Doug Reese, councilor Justin Ask, and Hometown Fiber representatives.

The meeting was held in response to a text Charter sent to the area on February 7 encouraging that Charter would mount fiber-optic lines in the Willmar Industrial Park at no cost to the city if the area stops the Connect Willmar Initiative.

” As described by Charter, this ( offer ) could accomplish that specific role short-term”, Box continued. ” However, when comparing the functionality of fibre networks to high-split systems, high-split sites fall short in the categories of speed, latency, power, consistency and scalability”.

In order to increase the bandwidth available for faster download and upload speeds, Charter is proposing a high-split system using the same coaxial infrastructure as Charter already has in place in Willmar. However, engineering would be carried out and digital amplifiers had been installed in order to send data out at a higher frequency range to increase the bandwidth available for faster download and upload speeds.

He added that there are limits on how far high-split designs can increase their frequencies and speed, particularly when there are many customers.

He noted that fiber networks have a 30- to 40-year lifespan and are the preferred option, with little interference or degradation in the amount of bandwidth or data being transferred over the line, for long-term performance and future scalability.

The city’s plan is to build a city-owned fiber-optic network throughout the city in three phases, with the first phase set to be constructed in 2025 for about$ 9.2 million. If the first phase proves successful, the next two phases would be constructed in 2026 and 2027.

The city will be in charge of the network and has a deal with Hometown Fiber to handle it. The city will then be required to pay a leasing fee for the use of the network.

The city intends to issue roughly$ 24.5 million in general obligation bonds to finance the construction of the network, and the lease fees collected from the ISPs will be used to pay the principal and interest on the bonds. The total cost of the project is now closer to$ 33 million thanks to the principal and interest payments on the bonds.

City staff noted that the Connect Willmar Initiative will still be a viable option for the council to approve in 2025 if Charter’s level of commitment or agreement does not meet the council’s needs. City staff would ask the council to approve requesting construction bids in April if the city were to proceed with the Connect Willmar Initiative.

Box noted that the Connect Willmar Initiative is still supported and recommended by the volunteer-based Willmar Committee in its advisory capacity.

” Obviously, the committee has put in a lot of work and spent a lot of time with the details, the information that you’ve seen. A lot of it comes down to choice, that was another factor in the decision-making process … having the regulatory oversight, providing choice to residents of Willmar, businesses of Willmar, and being able to adapt more quickly to the needs of our community”, Box said.

Audrey Nelsen, a councilor, inquired about what Charter’s pricing would be after the project and whether it would continue to be monopoly if the city cooperated with them.

” If they’re investing all this money in Willmar, are the rates going to go up, or are they going to go down? And how will we compare to other communities”? she asked, but Box could not answer that question.

The city has planned and conducted research for the Connect Willmar Initiative using approximately$ 675, 000 and numerous, many volunteer and human resource hours.

Councilors Rick Fagerlie and Tom Butterfield have consistently voted against the Connect Willmar Initiative’s approvals throughout the process, and it was obvious at the meeting on Tuesday that they had not changed their minds.

” I’ve been against this project since the beginning”, Fagerlie stated. ” There’s no way the city should be involved. … As far as I’m concerned, I would let Charter do it”.

Butterfield’s main concern is that the taxpayers will bear the costs of building the network. During Tuesday’s meeting, he asked questions about its financial viability, many that were addressed during the Feb. 10 work session conducted to give an update on the project.

One of his concerns is that the council still hasn’t learned what ISPs would charge customers and how much of that money would be returned to the city for debt service on the bonds.

Box noted that the projections that were made about the financial viability were very conservative.

” The numbers ( on pricing ) that you saw in the pro forma document … are significantly lower than ( the pricing ) we are seeing now”, Box said of the prices ISPs are expected to charge customers.

The figures you saw in the pro forma are even lower than what customers are likely to anticipate. So, what I’m getting at is, if you have instead of a$ 50 bill, you have a$ 75 dollar bill, it will only strengthen the pro forma model, not make it weaker”.

Councilor Stephen Gardner echoed Butterfield’s concerns, stating,” I’m averse to risk. And I believe we should be wary of risk as someone who has the authority to spend taxpayer dollars. I believe that educating the private sector on this is a way to reduce or eliminate risk. If this fails, am I willing to risk 33 million dollars in taxpayer money for nothing?

The motion, which was made by Gardner, directs the city staff and the city attorney to work with Charter by March 3 to set up a commitment to installing fiber-optic lines in the industrial park and establish a schedule for boosting residential services. Additionally, it directed staff to investigate the legal ramifications of terminating any contracts that have already been made between the city, Hometown Fiber, and other organizations in connection with the Connect Willmar Initiative.

The city’s largest provider of internet and cable television services, Spectrum, is a company that operates in the city.

Charter’s offer comes two years into the planning of the Connect Willmar Initiative. In the 2022 request for proposals to install fiber-optic services in the Willmar Industrial Park, the city requested one, but Charter did not.

The Connect Willmar Initiative was initiated by Hometown Fiber, who submitted only three proposals. The city has invested$ 200, 000 with Hometown Fiber to complete the network architecture, as well as provided a marketing budget for the initiative.

A Charter representative was questioned during a council work session in April of 2024 about whether Charter would commit to installing fiber-optic services in the industrial park several months before the City Council approved a$ 403, 000 professional services agreement with Bolton &amp, Menk for the Connect Willmar Initiative. Nothing more was said about it during the meeting, despite the representative’s claim that it might be part of an “offline conversation.”