Bloomington announcement on broadband fiber deal leaves some questions unanswered

It’s a planned $50 million investment to create a fiber-to-the-home network for most of Bloomington.

That’s the way an announcement from Bloomington mayor John Hamilton’s office on Friday afternoon framed some local broadband internet access news.

According to the city of Bloomington news release, the company making the $50 million investment is Meridiam, which is a global firm focused on infrastructure development. If all goes as described in Friday’s news release, construction of the network could start before the end of 2022.

According to Friday’s news release, a contract with an unnamed internet service provider (ISP) would ensure that Meridiam’s network will offer symmetric service (equal upload and download) of at least 1 gigabit per second everywhere in Meridiam’s Bloomington network.

Based on Friday’s news release, the city of Bloomington will have to bring a lot to the table as well.

Some of the financing for the project looks like it could come from a new tax increment financing (TIF) district. To establish a new TIF district, state law mandates a process involving Bloomington’s redevelopment commission, Bloomington plan commission, and the city council [IC 36-7-14-16].

A possible “spider TIF” for Meridiam’s fiber network appears as a discussion item on the Bloomington plan commission’s lunch session agenda for 11:30 a.m. on May 17. That’s an in-person meeting at city hall in the Kelly Conference room.

A “spider allocation area” for Meridiam also appears as a discussion item on the Bloomington redevelopment commission’s 5 p.m. May 16 meeting agenda.

Among the assets that Bloomington is contributing will be 30 years of access to the Bloomington Digital Underground (BDU) network. The BDU initiative, to install conduit to carry fiber-optic cable, started two decades ago.  Based on Herald-Times reporting from 2015, Bloomington has spent at least $1.2 million on the BDU and it includes at least 17 miles worth of conduit.

Bloomington is also contributing $1 million from the city of Bloomington to ensure that those with lower incomes can still access the internet service. The access speeds for qualifying lower-income residents are described as 250 megabits per second symmetrical service—which is one-quarter the top speed in the network.

Cost of that 250-megabit service for lower-income residents would be $30 a month. According to Friday’s news release, that would mean zero cost, when combined with the Biden Administration’s new $30 Affordable Connectivity Program.

The $50-million figure released on Friday is $10 million more than the previously announced planned investment by Meridiam in the Bloomington fiber project.

The “over $40-million” figure that was announced in mid-November last year came as a part of a news release from the mayor’s office about the fact that it had signed a letter of intent (LOI) with Meridiam for the fiber project. The LOI was signed in late August, about six weeks before the news release.

The LOI was worded so that it terminated at the end of 2021. Based on emailed correspondence between Bloomington IT director Rick Dietz and Meridiam, the LOI was extended at least twice to allow for more time to develop the terms of the master development agreement (MDA).

But the agreement between Bloomington and Meridiam is still not signed, according Bloomington communications director Andrew Krebbs.

Writing in response to a request from The B Square for the document, Krebbs wrote, “We expect the final MDA to be signed in the next couple of weeks.”

Based on the news release and other sources, the terms spelled out in the MDA could include: the choice of construction partner (Atlantic Engineering Group) to install the conduit and run the actual fiber-optic cable; a choice of internet service provider (ISP) by Meridiam; terms for Meridiam’s use of the Bloomington digital underground (BDU) network; and Bloomington’s contribution of around $1 million to ensure digital equity across demographic groups.

ISPs currently providing service in the Bloomington area include Xfinity (Comcast), AT&T, and Smithville.

The idea is that eventually any ISP could use the network that Meridiam plans to build out, making it a “full open-access network” for the lifetime of the network.

But for an initial period, only Meridiam’s ISP partner will be able to use the network. Friday’s news release also does not state how long the exclusive agreement will be with Meridiam’s initial ISP.

The name of the ISP partner, not necessarily one of the three now offering service locally, is not being released.

In an email written on Friday, Dietz said, “Meridiam has a capable provider in mind. They are currently finalizing that contract, which is separate from the arrangement between Meridiam and the City. We will have a FAQ page up next week…”

Friday’s news release came a half-decade after Bloomington announced the end of its attempt to partner with Axia, a Canadian company, in an earlier effort to create a citywide fiber network.

In 2017, Axia was also working with Fort Collins, Colorado to bring a fiber network to that city, with its population of about 170,000. Axia nixed both the Fort Collins and the Bloomington deals at the same time. ​​

A vestige of the Fort Collins connection is included in some documents released by the city of Bloomington to The B Square in response to a records request. Included in the emailed correspondence between Dietz and Meridiam, from late 2021 through early 2022, are drawings by Atlantic Engineering, for fiber optic cable routes in Fort Collins.

3 thoughts on “Bloomington announcement on broadband fiber deal leaves some questions unanswered

  1. I hope that as we move to new internet systems that there is a provision requiring removal of old equipment and cables.

  2. Fort Collins, CO and Bloomington have some similarities in this context. Both engaged a consultant for their internet project. Both engaged Columbia Telecommunications Corporation (CTC) for that analysis. Both originally chose Axia to build out their internet infrastructure and both deals fell through.

    The similarities end there. In the wake of that failure to launch, Fort Collins built out their own infrastructure and it is up and running: Bloomington has nothing. Fort Collins made the consultant’s report public. The Hamilton administration has declared the CTC report a ‘deliberative document’ and denied access to the report to interested citizens.

    Now, the administration says again that our hair is on fire and the Common Council, which has been kept in the dark from the time of the Axia failure five years ago until literally one hour before the Meridiam press release, has to pass a ‘spider TIF’ now, now, now.

    It’s bad enough that the administration botched the internet initiative. It is also quite unfortunate that their solution involves Bloomington taxpayers shoveling money unnecessarily into the pockets of a multi-national investment firm. But the continual efforts to exclude the Common Council from meaningful participation in any decision making process is really beyond the pale.

    How much more of this do we have to endure before Bloomington voters depose King John?


  3. Community Forum on the broadband proposal

    Tom Havens is executive director of the Indiana Cable & Broadband Association and author of a recent op-ed in The Herald Times on the broadband proposal.
    Why not have an open public forum with the Mayor and his advisors along with Mr. Havens to give our community an opportunity to ask in-person questions about the project?

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