American Fork bought a broadband network in 2002 to provide lightening-fast Internet to residents. Now the system might be up for sale or lease.

The City Council voted Tuesday to declare the system as surplus, then decided to request proposals from possible buyers or leasers for all or part of the network. The proposals are due July 13.

Although the city is looking at proposals, it could reject them, said City Councilman Shirl LeBaron.

Since the city purchased the system from Switchpoint, formerly AirSwitch, it has spent more than $6 million in bonds to pay for upgrades to the system. Including the bond payments, which continue for seven more years, the system has been losing $1.2 million annually, said Councilwoman Heidi Rodeback.

Rodeback said the city is committed to the system and wants to ensure it remains available to residents and businesses.

"It is believed that under private ownership, more capital will flow to meet the system's needs, and that market forces will bring about the necessary upgrades to and expansion of the existing network," she said.

Several in attendance Tuesday urged the city to postpone action. Mayor Heber Thompson explained the need to proceed.

"We are at a significant loss position," he said. "We don't have the prospect of getting much better very soon."

Rodeback suggested several requirements be placed on those who apply to buy or lease the system.

"They should honor all existing ISP contracts," she said. "They should offer the triple play," which she said includes offering telephone, television and Internet service together.

"They should extend the network to the remainder of the city within three years and offer employment on competitive terms to existing employees."

She suggested there be a clause in the contract that the city be granted the first right of refusal if the new owner declares bankruptcy or puts the system up for sale.

About one-fourth of the homes to which the service is available subscribe.

Under state law, the city can only provide the service as a wholesaler; Internet service providers sell service to residents and businesses. Rodeback said the network could be extended to more businesses that desire it, increasing the revenue.

This story appeared in The Daily Herald on page D1.