County PUD ends NoaNet membership

PUD owns 14.7 percent of organization, leaving debt of $2.7 million

EPHRATA — General Manager Tim Culbertson received the Grant County Public Utility District commissioner's vote of approval to formally end the district's membership with the Wenatchee-based telecommunications company Northwest Open Access Network, or NoaNet, during Monday's regular meeting.

NoaNet is a nonprofit company made up of a collection of public utilities in Washington state that use fiber optic cables from the Bonneville Power Administration to provide wholesale transport to different agencies and customers. Grant PUD currently buys upstream service from NoaNet, PUD officials said Tuesday.

"It's disappointing, they've been a good member of NoaNet and provided good leadership," said NoaNet Chief Executive Officer Greg Marney. "I was surprised and didn't know it was going to happen this week."

Marney said he was officially notified by the PUD Monday by Director of Telecommunications Larry Jones, but knew the district had been considering an end to its membership with the telecommunications company.

Grant PUD currently has an ownership interest of 14.7 percent in NoaNet totaling $2.7 million that it now has an obligation to pay as debt, both Culbertson and Jones said Tuesday.

They said Grant PUD is withdrawing from NoaNet to avoid further obligations due to the telecommunications company's borrowing of money. NoaNet has a $5 million line of credit that Grant PUD does not want to be exposed to in the future.

Grant PUD is also concerned that NoaNet's business plan has continued to be inadequate, the two officials said, and that Grant PUD did not have one of the seven NoaNet board member positions, despite the large share of ownership.

Both Grays Harbor PUD and Kittitas County PUD have already withdrawn their membership from NoaNet, Culbertson said.

NoaNet's CEO Marney said the remaining 12 PUD members have not considered a similar withdrawal.

If the PUD wants to replace the upstream service provided by NoaNet, they will be able to, Jones said. However, the initial price to the PUD may be more expensive because of additional infrastructure costs, he said.

PUD Commission President Bill Bjork said that NoaNet had not provided a business plan to move from their current deficit position to one where they would be meeting their financial obligations.

He also said the commission voted in favor of withdrawal because concerns have continued to exist that Grant PUD has one of the two largest ownership shares of NoaNet, but does not have a board member position while PUDs with 1-2 percent ownership do.

Most importantly, Bjork said, "There's no accountability whatsoever."

He said that the commission has asked and expected accountability form their own Grant PUD staff while NoaNet has continued to be unaccountable.

"They spend money like there was no tomorrow," Bjork said.