Joe Pyrah

Provo's high-speed communications network faced some tough love Wednesday morning -- without the love.

The system, running in the red for years, has had its debts covered by surpluses in city revenue. But there aren't likely to be surpluses for next year's budget, and the council already needs to find another $800,000 for this year's additional debts.

"We have to find the solution other than sales tax this year," said Councilman George Stewart, who is the chair of the committee.

Mayor Lewis Billings has admitted that the system is struggling and will propose specific methods to pull it out of the red when he presents his proposed city budget on May 6. The council takes recommendations by the mayor, but has the ultimate say on the budget.

One thing the committee agreed on is that they need hard numbers with which to work and an understanding of where they come from.

The fiber system has been losing between a $1 million and $2 million per year since 2003, but even those numbers are being padded.

The city has been using income from renting satellite time to bolster iProvo revenue as well using revenue from the city's pole fees (when Qwest strings a line, for example) that used to go to the Energy Department.

That isn't the sort of thing that was used in initial projections and indicates that iProvo's health may be even weaker than has been portrayed.

They dug into the triple-play shortfall, too. Projections were that as much as 75 percent of subscribers would opt for TV, Internet and phone services, but that number is closer to 17 percent. That isn't new, but committee member Steve White pointed out that 50 percent of the residential subscribers are in apartments where students have cell phones and eschew the landlines of old, digital or not. That makes any chance of picking up a substantial number of triple-play subscribers unlikely, he said.

It was also pointed out that the $39.5 million bond inflates to $64.3 million when the interest is counted over 20 years.

It was unanimous at the table that Provo's system is a great asset even with the losses. The system is built out and has more than 10,000 customers, leaps ahead of Utah's other struggling fiber initiative, UTOPIA, which is supposed to cover 11 cities but only has 7,200 subscribers.

"The infrastructure will always be in place whether we use it or somebody else does," said Councilman Steve Turley.

Committee members Curt Bramble and Stan Lockhart lauded the system even as they bemoaned management of the asset.

"I can say with some confidence because I have it: It's pretty good," Lockhart said.

At one point it was suggested that a timeline be set for reversing the slide. "When you have very poor budgeting, I'm not sure what the timeline is," answered Lockhart.

What the committee would like to see are some realistic subscriber projections after this year's debacle. The city budgeted for 260 new sign-ups per month, but the actual number was 69.

They also want to see a valuation of the system as a whole in the event they recommend selling all or part of it.

"I don't know enough yet about the finances to make an informed decision," Bramble said.

The committee meets again May 13 at 7 a.m. at the Provo city offices. The meeting is open to the public but is not a public hearing. The council has to finalize a budget within 45 days of the mayor's May 6 presentation.

From the outset of the meeting, Stewart said he wanted the committee to focus on solutions and not on frictions between city government factions.

"I'd like this to be more than a political decision -- mayor vs. council," he said.

But it didn't take him long to clear himself of the whole fiber situation either, mentioning that he was in Argentina on an LDS mission when the system was voted in. He also told the committee it was no secret he's in favor of selling iProvo. Stewart is a former mayor who has said he might run again next year.

"There's political agendas flying through this whole thing," said Councilwoman Midge Johnson afterward. Johnson is not a member of the committee but attended Wednesday's meeting.

She added that it seemed to her like the committee was already being steered by Stewart toward just one solution: selling the system. That sentiment was brought up earlier in the meeting by Jane Carlile, a committee member and former council member.

She cut in as several members chuckled about a string of issues, saying she felt that the tone of the meeting was that Stewart was "driving this in a particular direction" instead of looking for the "cleanest, clearest, most unpolluted solution."