Discussion and possible action to adopt ORD. 2025-09 amending Chapter 23 of the City Code (1992), entitled Streets, Sidewalks and Public Improvements by adopting Sections 23-107 through 23-121, pertaining to Fiber Optic Communications Systems. 

Chapter 23 of the City Code currently does not allow Fiber Optic Communications Systems and the provision of Fiber Optic Communications Services in the public rights-of-way and easements.

The purpose of ORD. 2025-09 is to establish a legislative framework to allow the City to enter into licenses with providers that desire to install, construct, operate or maintain Fiber Optic Communications Systems and to provide Fiber Optic Communications Services in the public rights-of-way and easements.

This new legislation governs the management of Public Highways and rights-of-way for the installation, construction, operation or maintenance of any Fiber Optic Communications Systems and the provision of Fiber Optic Communications Services. Under the terms of these new code sections, the City will be allowed to issue licenses to Internet Service Providers (ISP’s) that desire to provide homes and businesses with high-speed fiber broadband internet access. This new legislation will also allow companies that have a License to occupy the City rights-of-way or other City property with their facilities to lease, license, or contract the use of their fiber-optic broadband connections, strands of fiber, or conduit to third parties.

The Ordinance will also provide the framework to:

• Establish violations and penalties for operation of Fiber Optic Communication Systems without a License.
• Require submittal of an application.
• Establish the duration of the License to be five (5) years.
• Establish License Fees as follows:
    -  A negotiable Annual Minimum Fee (AMF) based on the size of the service area covered by the Licensee, which will either be paid quarterly or annually.
    - Once the Licensee starts earning revenue from its services, and that revenue exceeds the quarterly or annual AMF, then Licensee will transition to the percentage of gross revenues fee structure set forth below. If the revenues do not exceed the AMF, then the Licensee will remain with the AMF fee structure.
    -  If the Licensee is offering internet access services directly to subscribers and is the Internet Service Provider (ISP), the license fee shall be three (3%) percent of Gross Revenues.
    -  If a Licensee occupies the City rights-of-way or other City property and leases, licenses, or contracts the use of fiber-optic broadband connections, strands of fiber, or conduit to a third party in exchange for any form of compensation, the Licensee must pay an annual license fee of six percent (6%) of Licensee’s annual Gross Revenue.
• Provides an incentive to providers to install their facilities early in new residential subdivisions while the developer is building out the streets. The license fee will be waived up to the point that the developer obtains fifty-one (51%) of permits for the development.
• Establish requirements to locate and relocate facilities in ROW.
• Establish requirements for work within the ROW and to repair city ROW and facilities.
• Establish an annual accounting and reporting by Licensee of its Gross Revenues.
• Require Licensee to pay for all plan review fees, permits, inspections, ROW Management, and other fees for staff time that are directly related to the construction, operation, and repair of the facilities required for the Fiber Optic Communications Systems.

As a result of this Ordinance, residents and businesses will have more choices for fiber broadband internet service and high-speed fiber data services for other providers and businesses, and it is anticipated that the competition will provide for better service and lower costs.

A second Ordinance will be presented to Council for adoption in May 2025 which will update Chapter 27 of the City Code and establish new License fees related to Fiber Optic Communications Systems.  

• March 5, 2024 – Council Study Session presentation on contemplated legislation, fee ordinance and form of license for Fiber Optic Broadband Facilities.
• March 2024 – November 2024  - Staff met with other municipalities and broadband fiber providers and took feedback into consideration when drafting the legislation and form of license.
• May 2024 - FCC released its Decision No. FCC-24-52A1 wherein it classified broadband fiber internet as Telecommunications.
• July 2024 - FCC’s decision became effective.
• December 17, 2024 – Council Study Session presentation updating on the status of Broadband Fiber Optics.
• March 27, 2025 – Final version of the proposed legislation was sent to the providers as information only.  

Staff recommends adoption of ORD. 2025-09 amending Chapter 23 of the City Code (1992), entitled Streets, Sidewalks and Public Improvements by adopting Sections 23-107 through 23-121, pertaining to Fiber Optic Communications Systems.