$6 million fibre loan approved

The Fibre To the Premise project could potentially bring $8 million in extra revenue to the Olds Institute For Community and Regional Development by 2025, say proponents of the project.

The money would be used to fund further community projects.

Stirling McLeod, a member of the technology committee of the OICRD, made the projection during a presentation to Olds Town Council during council's regular meeting on March 28. The revenue would be on top of paying off the $6-million 10-year loan council was requested to ratify by town administration.

“We've just done so many … calculations based on the data we've been able to get. If you look at the financial model we have right now that could end up totalling $8 million by the end of 2025. It's really challenging to accurately forecast what's going to happen four years out, let alone 14,” he said.

McLeod told council that an excellent business case has been built by the OICRD. He said in a survey the OICRD did regarding the project, 79 per cent of respondents said they were somewhat or very interested in using the Internet service that would be offered as part of the project by Olds Fibre Ltd. Most also said they were willing to pay the same they do now for the same types of service. Respondents pay an average of $172 per month for those services.

The group spearheading the project assumed a 30 per cent take rate in existing residents and 20 per cent in existing businesses. McLeod said he thinks that is relatively conservative.

“In the United States, where there are a number of community networks like this, they are experiencing take rates of 52 to 58 per cent,” he said, noting that in the U.S. communities they don't have strong incumbent providers that exist here. “That's why we're being very conservative.”

Joe Gustafson, chair of the technology committee, told councillors that the plan is to build the network over two years beginning this spring. The fibre optic will be strung from a central office to the edge of every property in town and if the property owner subscribes to the service, it will be strung inside the premise. He said the town will be split into 11 different districts, but it's not been determined at this point which district will get the fibre optic first.

Gustafson said the project has always been about economic development.

“We believe this project … will give our community a leg up,” he said.

Gustafson said all operations of the network will be outsourced to make sure the best people will be monitoring it all the time. He said although service interruptions are inevitable, the goal is to keep them to a minimum.

The goal is to sign customers up by September.

Council unanimously approved administration's suggested motion to approve the loan agreement to the OICRD for the project, in principle subject to four conditions including the completion of all business terms in a manner consistent with the Request For Decision and subject to revisions and approval of form and content by administration and the town's legal counsel; the execution, delivery and where applicable, the registration, of all security documentation contemplated in the RFD; the receipt, by the town's legal counsel, of all certificates, resolutions, opinions or other collateral assurances as warranted by legal counsel to protect the interests of town; and receipt of all project documentation to permit the completion of the loan.

Mayor Judy Dahl said the project would help the community with economic development.

“It's very innovative. These individuals, volunteers, that have been working on this project for the past four years, if not more, certainly deserve a great (thank you) from the community to provide this sustainable revenue stream for the Town of Olds,” she said.

Dahl said she was particularly pleased to hear about the potential amount of money the project will generate for further community development.

“We're very confident in the overview that they provided council over the past year and we believe it's a solid plan,” she said.