PUD examines fiber rates

Workshop on Zipp set for Jan. 12

EPHRATA — The Grant County Public Utility District is holding a rate schedule workshop on Jan. 12 concerning Zipp Fiber Network services, but the reason for the workshop is not exactly clear.

Some of the district's board of commissioners say the system loses money because the current rate schedule 100 fails to adequately charge for fiber system services.

The district gives free transport of data packets, or bandwidth, to Northwest Open Access Network and other out-of-county Internet service providers while the district's fiber optic system continues to lose money, said Commission President Bill Bjork.

The fiber system lost about $6 million in 2004 and is scheduled to lose another $6 million by the end of 2005, said Bjork.

He believes there is a direct relationship between the continued loss of money and inadequate charging for services.

"We're going to take a look at it and come up with a better solution," he said. "We need to start charging NoaNet and a few others the proper amount."

Earlier this year, three local ISPs petitioned the Washington State Utilities and Transportation Commission to review rates charged for service on the fiber system, such as bandwidth, believing rates charged are unfair or discriminatory.

"Rates need to be fair and equal to everyone," said Commissioner Randy Allred.

He said the board received information concerning the current rates, leading them to hold the workshop. But he declined to say what information the commission received and who provided it.

Commissioner Tom Flint said the workshop is part of an annual review of rates. He described suggestions of lost money and inadequate charging of services as merely allegations.

"We'll look into all the allegations that have been made," said Flint.

The PUD must build the remaining two-thirds of the fiber system before it can pay for itself, he said.

"If the goal is to have the system be self-sufficient we have to complete the build out."

He hopes the workshop will provide information about how Grant County residents use the system at home or in their businesses and wants to learn what effect any proposed rate schedule change may have on those end-users.

Commissioner Greg Hansen believes they provide services to NoaNet and do not adequately charge for them. He said faulty charges to NoaNet cost the district hundreds of thousands of dollars every year.

"Fact is we're not charging NoaNet for bandwidth, pure and simple," said Hansen. "Once we address rate schedule 100, it may make Zipp look a little better."

Commissioners asked district staff to schedule the workshop to develop rates for bandwidth transport and provide them with an opportunity to hear from local ISPs and end-users, he said.

The system currently operates at a cost of $7.5 million, receives revenues of about $1.5 million and is subsidized by the district's electric system, he said.

"If we start charging NoaNet for services we should be charging now, it could bring (lost revenue) down."

The workshop will be held at the Ephrata headquarters building from 9 a.m. until noon.