Kaysville City is considering an Interlocal Agreement to be formed with American Fork, Utah also known as LightHub. American Fork City is a city also implementing a municipal-owned fiber optic internet infrastructure. They are a city of similar size to Kaysville City with similar needs. This agreement is being created in a similar manner as the agreement we have in the Power Department with UAMPS as a way to save money to the residents and businesses of Kaysville City.
Why an Interlocal?
Overhead and maintenance is the most expensive part of a technological project of this size. Sharing services like Network Operations and Customer Service or equipment purchasing with other cities is one way we can reduce cost
Will we lose all control of our fiber network?
No. Kaysville City will still own and manage our fiber optic network. Kaysville Fiber will have its own brand, look and feel, and local presence.
Is this the same as Utopia?
No. UTOPIA/UIA was formed to bond collectively, meaning each city has a vote in proportion to the size of their city. In this Interlocal, Kaysville City, American Fork City, and any other city or cities that join in the future will each be responsible for their bonding even if done within the Interlocal.
Will we be responsible for other city’s debt?
No. Our finances will be completely separate from the other cities. All money collected from utility fees and revenue from the Internet Service Providers will go directly to Kaysville City who will then pay off the bond whether directly or through the Interlocal.
Who will make the decisions on the Interlocal?
The Interlocal will have a Board of Directors made up of representatives from each city, and one non-paid Executive Director for a specific period of time.
Will the Interlocal make money? Are the board members paid?
Should any excess funds be accumulated within the Interlocal, it will be distributed back to each municipality based on where it was generated. The Interlocal will not be a profit center. The Mayor of Kaysville City or his/her designee serves on the Board of Directors without compensation from the Interlocal.
What transparency will there be?
The Interlocal will maintain books and records just like Kaysville City. They will conduct an annual audit of their books and provide reporting about all activities within the Interlocal.
How will money be handled?
All money from the utility fee and upgraded internet service will be collected by Kaysville City. Kaysville City will pay its financial obligation to the various service providers including the Interlocal based upon what has been contracted with each provider. Part of the value of the Utility Model is that Kaysville City will have first receipt of all revenue from the Fiber Utility.
Is this a way to avoid a general obligation bond?
No. Kaysville City can take out a revenue bond directly for this project if it so chooses. The Interlocal is just another option and when combined with other municipalities may provide efficiencies of scale that could benefit Kaysville City and the fiber project.
What eminent domain powers does the Interlocal have?
The Interlocal is a public entity, and thus has the power of eminent domain when acting for a public purpose. The agreement specifically limits the power of eminent domain within Kaysville City and requires Kaysville City approval. This is a reasonable balance to make sure such power is used only when necessary.
What taxing authority does the Interlocal have?
The Interlocal agreement does not grant the power to levy taxes in Kaysville City. There are no scenarios where Kaysville City would be required to share taxes, unless Kaysville City agrees to do so in a separate agreement.