The Leverett Municipal Broadband Model An Overview of Institutional, Contractual and Financial Arrangements 3/ 6/ 2016 1 MLP Board of the Town of Leverett, MA
Preface This material was developed by consultants at DHInfrastructure in cooperation with the Leverett Municipal Light Plant (LMLP) and the Town of Leverett, Massachusetts. The material is meant to inform policymakers and the general public on Leverett’s approach, and in particular, to offer information that will help towns considering how best to bring high speed Internet to unserved or underserved populations. The LMLP is a municipal light plant established under Massachusetts General Law 164 to provide high speed Internet and telephony services to residents, public buildings and businesses in the Town of Leverett. The service is known as “LeverettNet”. As a municipal entity, the LMLP serves as the custodian of the network assets, which are in turn owned by the Town. The LMLP is governed by a three member board of un-paid volunteers, each appointed by the Town's Select Board. The LMLP board appoints a Manager to oversee all contracts related to network operations. The LMLP Manager concurrently serves as the Town Administrator. More information on LeverettNet and the LMLP may be found at lmlp.leverettnet.net. DHInfrastructure LLC is an economic consulting firm that specializes in regulated network 3/ 6/ 2016 infrastructure. DHInfrastructure advises governments, investors, and utilities on matters related to the energy, water, telecommunications and transport industries; applying principles of economics and finance to public policy, regulation, litigation of disputes and infrastructure acquisitions. More information on DHInfrastructure may be found at www.dhinfrastructure.com. 2 While e ve ry e ffo rt ha s b e e n ma de to e nsure the q ua lity a nd a c c ura c y o f the info rma tio n a nd a na lysis c o nta ine d in this do c ume nt, the c o nte nts a re ma de a va ila b le witho ut wa rra nty o f a ny kind. Ne ithe r the L e ve re tt ML P no r DHInfra struc ture a c c e pt a ny re spo nsib ility o r lia b ility, whe the r dire c t o r indire c t, fo r the c urre nc y o r a c c ura c y o f the info rma tio n o r a na lysis, no r a ny c o nse q ue nc e o f its use .
Contents • Contractual Arrangements • Pre-construction and construction phases • Operations • Operational flow of funds • Allocation of Responsibilities • Pre-construction and construction phases • Operations • Financial Arrangements • Overview of costs: Estimated annual cash cost (2016) • Cost of service Project related costs and funding • Total project costs • Budgeted operating and maintenance costs • 3/ 6/ 2016 • Next Steps • Follow-on work • Appendix • Glossary of acronyms and abbreviations 3 • Background and demographics
Contractual Arrangements 3/ 6/ 2016 4
Contractual Arrangements Pre-construction and construction phases Constr uc tion Agr e e me nt De fine s MCG’ s re spo nsib ilitie s fo r: T own of L e ve r e tt/ ML P Pole Attac hme nt Agr e e me nt • Ne two rk de sig n to ho use ho lds Go ve rns ML P, Ve rizo n, a nd • POP De sig n E ve rso urc e ’ s re spo nsib ilitie s fo r Se le c t Boar d • Dro ps a nd ONTinsta llatio n pre -c o nstruc tio n inspe c tio n a nd Ma ke -re a dy o ve rsig ht • ma ke -re a dy wo rk fo r po le • Ne two rk e q uipme nt and fib e r a tta c hme nts c o nstruc tio n E ve rso urc e HG&E MCG a nd Ve rizo n 3/ 6/ 2016 Pr oje c t Manage me nt Se r vic e s Agr e e me nt Right of E ntr y Agr e e me nt De fine s HG&E ’ s re spo nsib ilitie s a s the Autho rize s ML P to insta ll a nd Home owne r s pro je c t ma nag e r ("Cle rk-o f-the - ma inta in ne two rk Wo rks") fo r the de ve lo pme nt o f e q uipme nt o n the pre mise s L e ve re ttNe t inc luding b idding a nd 5 c o nstruc tio n pha se s Co ntra c t Co ntra c tua l re la tio nships
Contractual Arrangements Operations F T T H Ope r ator Se r vic e s Pole Attac hme nt Agr e e me nt De fine s the le a se te rms fo r Agr e e me nt De fine s HG&E ’ s re spo nsib ilitie s ML P’ s po le a tta c hme nts a nd ML P ne c e ssa ry po st-c o nstruc tio n fo r: • Ne two rk c o nne c tivity to the inspe c tio ns ISP Mo nito ring a nd ma inta ining • ne two rk e q uipme nt in Po Ps, middle -mile to ISP, CPE s a nd ONT s. E ve rso urc e Co llins E le c tric , Cro c ke r a nd MBI/ Axia HG&E Ada ms E le c tric , a nd Co mmunic a tio ns Ve rizo n Gra c e E le c tric Communic ations Se r vic e s Middle -Mile Agr e e me nt (maste r Ac c e ss ISP c ontr ac t) 3/ 6/ 2016 Ag re e me nt (3 rd De fine s Cro c ke r’ s Mainte nanc e Agr e e me nt pa rty) re spo nsib ilitie s fo r: Ma inta ining • c o nsume r ISP Co ntrac t Subsc r ibe r s pre mise s with Sub sc rib e rs e q uipme nt 6 • Billing a nd c o lle c tio ns • Pro viding se rvic e fe a ture s, e .g . te le pho ny a nd Co ntra c t Co ntra c tua l re la tio nships vo ic e mail
Contractual Arrangements Operational flow of funds T own Ac c ountant Autho rize s a ll flo ws o f funds F o rwa rds ML P fixe d c o st re c o ve ry Disb urse s funds* fe e s T own T r e asur e r Re q ue sts Co llins E le c tric , Sub mits mo nthly disb urse me nts Ada ms E le c tric , a nd invo ic e Gra c e E le c tric Cro c ke r HG&E ML P Co mmunic a tio ns Sub mits mo nthly invo ic e fo r fixe d F o rwa rds c o st re c o ve ry middle 3/ 6/ 2016 I ssue s fe e Axia Pa ys mile fe e s mo nthly Sub mits a nnua l mo nthly invo ic e fo r po le b ill b ill a tta c hme nts E ve rso urc e / Ve rizo n 7 F unds fro m c o ntra c ting F unds fro m Subscribers e ntitie s T o wn o f L e ve re tt *T o wn tre a sure r ma ke s a ll Invo ic e s fro m F unds fro m sub sc rib e rs pa ya b le s to ML P c o ntra c to rs, i.e . c o ntra c ting e ntitie s PURMA, e tc . Invo ic e s fro m ML P Autho riza tio n
Allocation of responsibilities 3/ 6/ 2016 8
Allocation of Responsibilities Pre-construction and construction phases Gra nt funding fo r T own of L e ve r e tt/ ML P ne two rk de sig n a nd c o nstruc tio n Ma na g e d pro c ure me nt pro c e ss Se le c t Boa r d MBI L e ve r e ttNe t Advise d o n te c hnic a l spe c ific a tio ns Br oa dba nd a nd pro c ure me nt Owns middle Committe e mile a sse ts Advise d o n pro c ure me nt a nd Inve stme nts in c o re ro ute r pro je c t mg mt. a nd re po rting so ftwa re Ma ke - Built re a dy ne two rk wo rk o n po le s Cro c ke r Co mmunic a tio ns MCG HG&E E ve rso urc e 3/ 6/ 2016 a nd Ve rizo n T a xpa ye rs pa y Owns utility ta xe s to se rvic e po le s de b t o n GOB* 9 Co ntra c t Und e r c o nstruc tio n Home owne r s CAPE X F ina nc ing CAPE X Pla nning Owne rship Co ntra c tua l re la tio nships GOB* Ge ne ra l Ob lig a tio n Bo nd
Allocation of Responsibilities Operations T own of L e ve r e tt ML P re spo nsib le fo r future CAPE X pla nning ML P L e ve r e ttNe t Se rve s a s c usto dia n o f T o wn’ s a sse ts Owns the “la st mile ” a sse ts Inspe c ts Pa sse s thro ug h Ma inta ins a nd mo nito rs ne two rk po le s ML P fe e c o nne c tivity a nd e q uipme nt Cro c ke r E ve rso urc e Axia HG&E Co mmunic a tio ns a nd Ve rizo n Pro vide s b a c khaul se rvic e • Pro vide s inte rne t Pa ys b ill (whic h se rvic e s inc lude s ML P Owns po le s • Invo ic e s a nd fe e *) use d to mo unt c o lle c ts b ills (whic h fib e r 3/ 6/ 2016 Co ntra c t inc lude s ML P fe e *) • Pro vide s e nd use r Pro vide ro utine a nd CAPE X c usto me r suppo rt e me rg e nc y ma inte nanc e se rvic e s O&M Co llins E le c tric , Billing / 10 Ad a ms E le c tric , a nd Custo me r Gra c e E le c tric Se rvic e Subsc r ibe r s Owne rship *Inc lude s O&M c o sts a nd c o ntrib utio n to de pre c ia tio n re se rve
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