Franklin, Indiana. Monday March 5, 2012 CITY OF FRANKLIN COMMON COUNCIL MEETING

Transcription

1 Franklin, Indiana Monday March 5, 2012 CITY OF FRANKLIN COMMON COUNCIL MEETING CITY OF FRANKLIN, TOWN OF WHITELAND, TOWN OF NEW WHITELAND AND AREAS IN JOHNSON COUNTY MN FTTP TIF BOND METRONET FTTP

2 About MetroNet Cinergy MetroNet headquarters, Evansville, IN Lebanon, IN Madison, IN Headquartered in Evansville, IN Provider of Enhanced Internet, Voice & Cable TV Services Customer-focused FTTP Over-builder Fiber Optic Network More than 60,000 Homes 10,500 Businesses Anchor institutions: hospitals, libraries, police, local government, etc. CMN crew installing fiber underground Existing Indiana Communities Greencastle (2005) CMN Seymour (2007) Vincennes (2008) North Vernon (2009) Madison (2009) Wabash (2010) North Manchester (2010) Huntington (2010) Connersville (2010) New Castle (2010) Lebanon (2011) MN Communities being Considered Franklin, IN MN (est. 2012) Tippecanoe County, IN MN (est. 2013) Other Indiana Communities and Nearby States 2

3 Our Network 3

4 Digital Cable TV 180+ channels 90+ HD channels 1000s of video-on-demand movie titles Residential Services High-Speed Internet Speeds up to 75 Mbps Full-Featured Phone Unlimited Long Distance Variety of Bundles 4

5 Franklin Area Meetings and Activities for the MN FTTP Project Partial List 2009: Preliminary MN FTTP discussions with City of Franklin May 24, 2011: MN met with City of Franklin Telecommunications Council ( FTC ) and City Officials to discuss MN, its FTTP projects in Indiana and possible FTTP TIF Bond June 1 (?): FTC informational and Q&A meeting MN, FTTP and TIF June 8: Clerk-Treasurer Town of New Whiteland informational meeting MN, FTTP and FTTP TIF Bond June 15: MN, FTTP and FTTP TIF Bond informational and Q&A meeting in Franklin Council Chambers with representatives from City of Franklin, Franklin RDC, FTC, Johnson County, Town of Whiteland, Town New Whiteland and other local officials June 15: Town Manager of Whiteland - informational meeting MN, FTTP and TIF June 30: Bargersville Municipal Utilities informational meeting - MN, FTTP, TIF and Pole Attachment Agreement July 2011: City of Franklin, Town of Whiteland, New Whiteland and Johnson County officials selected Richard Starkey, partner Barnes & Thornburg, as Bond Counsel and Jim Higgins, partner London Witte, as Financial Advisor to represent the municipalities for the issuance of the FTTP TIF Bond July 19: New Whiteland Town Council meeting - informational meeting - MN, FTTP and TIF August 4: Franklin Area officials large informational and Q&A meeting in the Franklin City - MN, FTTP, scope of the possible project, service offerings and FTTP TIF Bonds August 4: JC County Economic Development Corp. and JC REMC informational meeting MN, FTTP, TIF Bonds and Pole Attachment arrangements August 8: Bargersville Town Council informational meeting - MN, FTTP, TIF and Pole Attachment August 10: FTC technical meeting, Q&A session and tour of MN facilities and Headquarters in Evansville August 18: City of Franklin Redevelopment Commission informational meeting - MN, FTTP and TIF August 22: Johnson County Commissioners informational meeting - MN, FTTP, scope of the FTTP project and FTTP TIF Bonds August 22: Johnson County REMC informational meeting - MN, FTTP, TIF and Pole Attachment August 23: Franklin Community Schools, Clark-Pleasant Schools, Franklin College and Johnson Memorial Hospital informational meeting - MN, FTTP project, service offerings, FTTP TIF Bonds, school funding and personal property tax revenues September 19: Franklin City Council meeting FTC presented a Resolution supporting the MN FTTP project and requested (recommended) the full support by the City of Franklin for the MN project and MN informational session regarding MN, FTTP, scope of possible MN FTTP project, service offerings, and FTTP TIF Bonds September 19: City of Franklin City Council meeting - informational meeting - MN, FTTP and TIF September 20: New Whiteland Town Council meeting voted to support the City of Franklin issuing a FTTP TIF Bond that would include the Town of New Whiteland October 11: Whiteland Town Council meeting passed a Resolution granting authority to City of Franklin to issue a FTTP TIF Bond that would include the Town of Whiteland October 17: County Commissioners meeting passed Resolution granting authority to City of Franklin to issue the MN FTTP TIF Bond October 17: Franklin City Council meeting - approved the timeline for moving forward with the MN FTTP project and for the Franklin RDC to consider the MN FTTP TIF Bond Declaratory Resolution ( DR ) to start the MN FTTP TIF Bond issuance process October 20: Franklin RDC meeting - passed the MN FTTP TIF Bond Declaratory Resolution starting the FTTP TIF Bond issuance process October 31, 2011 to January 13, 2012: MN completing its $50,000 (Est.) Field Engineering and Final Feasibility study November 2011: The City of Franklin formally engaged Richard Starkey, partner Barnes & Thornburg, as Bond Counsel and Jim Higgins, partner London Witte, as Financial Advisor to represent the City for the issuance of the FTTP TIF Bond January 13, 2012: Meeting at Franklin City Hall with City officials February 24, 2012: City of Franklin officials informational meeting and Q&A regarding MN, the proposed MN FTTP project and the FTTP TIF Bond May 2011 to March 5, 2012: Number of other meetings and discussions regarding FTTP, service offerings and permits/variances 5

6 What does Fiber mean to a community? FTTP Overview Fiber is the next generation of technology Transmits light over fiber optic cable - a strand of glass as thin as a hair Improvements in fiber technology continue every day Fiber networks have the capability to deliver over 1 gigabit Internet speeds Allows for new innovations and cutting-edge technologies to develop in Franklin Area What does a comprehensive FTTP infrastructure mean to Franklin Area? An economic development infrastructure required help retain and attract investment and jobs Provides immediate benefits to existing residents, students, businesses and institutions A FTTP network provides greater opportunities for home grown entrepreneurship, telecommuting, distance learning, telemedicine, etc. Provides more choices Future-proof infrastructure No financial risks to Franklin or other taxpayers Are there any other risks to Franklin? No Is there an existing comprehensive FTTP network in Franklin? No. A full scale FTTP network does not currently exist in Franklin What happened to the Google FTTP project and their nationwide search for a community? Nearly 1,100 communities expressed an interest in the proposed Google FTTP project Google selected Kansas City, KS 6

7 Franklin Deal Structure What type of fiber network is MN considering for in the Franklin Area? A comprehensive all fiber (FTTP) network serving homes and businesses What type of services will be offered in Franklin? Initially: Very high speed Internet services Expanded Video (IPTV) services Robust telephone services Future: Let your imagination have fun How long does it take to over build a FTTP network like this in the Franklin Area? It will take several years to build out Final design and funding schedules from investors will impact the schedule When is the earliest MN could start to build this project in Franklin? It will take several months for the necessary approvals, final design and Make-Ready The earliest would be mid to late 2012 Where is MN considering installing its FTTP network in the Franklin Area? City of Franklin, Town of Whiteland, and Town of New Whiteland and contiguous areas in unincorporated sections of Johnson County (such as adjacent subdivisions) 7

8 Franklin Deal Structure What will it cost to build an FTTP network like this in Franklin? MN s preliminary capital expenditure estimates are in the $20 million range What s it going to take for MN to make this kind of investment in Franklin? Our investors must be willing to make a very significant commitment to the Franklin Area as compared to other investment opportunities and communities All numbers must work in Franklin Community support and a willingness to work with MN Good fit with Franklin s economic development and technology plans Issuance of an MN FTTP TIF Bond for the project - a very unique TIF Bond with no financial risk or obligation to City of Franklin or any other taxpayers What are the steps? MN preliminary studies and analysis for a full scale FTTP project in Franklin (check) Approvals from the City of Franklin (check), Town of Whiteland (check), Town of New Whiteland (check) and Johnson County (check) to move forward with the MN FTTP project TIF Declaratory Resolution starting the process to issue the MN FTTP TIF Bond (check) With the approval of the Declaratory Resolution, MN commissioned a comprehensive Field Engineering and Feasibility Study, which will cost in the $50,000 range, to determine the feasibility of the proposed MN FTTP project (check - study completed) Bids, cost estimates, interim design and fine tuning the model to confirm the feasibility of the project in the Franklin Area (check move forward with the FTTP project with final approvals, including TIF) MN Board approval (check - move forward with the FTTP project with final approvals, including TIF) Pole Attachment Agreements Duke completed and working with Bargersville and JC REMC Complete FTTP TIF Bond issuance process, permits and other approvals Make Ready and Construction of the MN FTTP network 8

9 Franklin Deal Structure What is so unique about the proposed MN FTTP TIF Bond? The FTTP TIF area is not a geographically defined area like a business or industrial park The designated FTTP TIF area is the fiber plant and associated equipment itself, wherever the FTTP plant is placed It s not the physical land or property under it, over it, next to it or around it It s like a virtual TIF area including only the related fiber plant The major component is the FTTP personal property Does the FTTP TIF also apply to the associated real property? It could but there is not a lot of real property associated with FTTP projects; only a very small percentage of the total plant is classified as real property How does the FTTP TIF Bond work? It s a revenue bond and not a general obligation bond The amount of the FTTP TIF Bond is based on the amount of property tax projected to be paid solely by MN on its FTTP plant over a maximum of 25 year period of time (including interest, etc.) Who buys the MN FTTP TIF Bond? MN will purchase the Bond Who is financially responsible for the FTTP TIF Bond? MN carries 100% of the financial risk for the FTTP assets and TIF Bond Do the city, towns, county and/or other taxpayers guarantee or back-stop the MN FTTP TIF Bond in any way? No. MN is financially obligated for the FFTP TIF Bond Do any other public funds or other tax dollars go to MN? No 9

10 Franklin Deal Structure What happens to the FTTP TIF Bond if MN does not build the FTTP network? MN does not receive any property tax revenue MN only receives its TIF Bond payments if it actually pays property taxes Does MN receive any other property tax revenue from any other property taxpayers in Franklin? No. Absolutely not Does this FTTP TIF Bond apply against any city, town or county bonding capacity or limits that might impact other or future development projects in Franklin? No Does the MN FTTP TIF Bond have any impact on the City s Credit Rating? No. Absolutely not What is the expected amount of the MN FTTP TIF Bond in the Franklin Area? MN FTTP TIF Bond amount will not exceed $2.75 Million for Franklin, Whiteland, New Whiteland, and a portion on the unincorporated areas of Johnson County When would MN receive any payments to apply to the FTTP TIF Bond? MN would not receive any TIF funds until the MN FTTP plant generates property tax revenue At least 2 years from now Would MN receive any upfront TIF or other tax funds for its FTTP network? None. CMN would not receive any TIF funds until MN actually pays its property taxes Does the TIF Bond finance the MN FTTP project in Franklin? Absolutely not. MN investors will finance the project The MN FTTP TIF Bond is an incentive to MN investors to make a $20 million investment in the Franklin Area 10

11 MN FTTP TIF Bond Brief Summary MN FTTP TIF District Established Includes only MN Personal Property MN FTTP TIF Bond issued not to exceed $2.75 M MN purchases the TIF Bond MN investors finance the FTTP project MN There are No upfront FTTP TIF Funds MN There are No other Public Funds MN pays personal property taxes MN property tax revenue produced from the MN FTTP plant is used to make Bond payments (no other tax funds or other public funds are allowed to pay for the MN FTTP TIF Bond) No MN Fiber - No MN Property Taxes No MN TIF Funds Franklin Area Receives Comprehensive FTTP Infrastructure Serving Homes and Businesses 11

12 Franchise Authority, Fees and Regulatory Approvals Does MN have the required video services franchise authority to serve the Franklin Area and selected areas in Johnson County? Yes In June 2011, MN filed its Video Services Application with the IURC to serve the Franklin Area and parts of Johnson County, among a number of possible service areas in Indiana In August 2011, the IURC approved MN s Application to provide Video Services in Franklin and adjacent areas Will the City of Franklin, Town of Whiteland, Town of New Whiteland and Johnson County receive franchise fees from MN Video Services provided in the Franklin Area? Yes Each entity will receive the maximum allowed 5% of gross revenues on MN Video Services provided in each respective jurisdiction, according to new state statutes Is MN a public utility with the right to use public rights-of-way and public utility easements in the Franklin Area and Johnson County? Yes. MN is a public utility throughout State of Indiana and is classified as a Competitive Local Exchange Carrier ( CLEC ) 12

13 Economic Development Vincennes Former Mayor Al Baldwin We are elated Cinergy selected Vincennes for their next expansion, and we re looking forward to the additional communications products that will enhance the quality of life offerings Vincennes has to offer. Seymour Jim Plump, Economic Development Seymour, Indiana would not be able to compete for new data centers, call centers or companies requiring the transport of large amounts data if Cinergy MetroNet did not build its fiber optic Broadband network in our community. Connersville Mayor Leonard Urban "Having Cinergy MetroNet come to Connersville and provide internet, telephone, and cable TV to our community is great for our citizens. But above and beyond that, the fact that they ll be able to offer fiber optics and high-speed internet access to our homes and businesses will help expand many of our businesses. The other incredible thing that about this company is that they are investing $8 million plus dollars in infrastructure and assessed value. As Mayor, I say, welcome to our town and let us help you in any way that we can." Wabash & N Manchester Bill Konyha, Economic Development Fiber optic service and broadband access are critical to our ability to transition to a knowledgebased economy. Without Cinergy MetroNet broadband service, we don t have a prayer. It is absolutely vital. 13

14 Inside Our Stores Greencastle Madison Seymour Lebanon 14