Santa Clarita, a community of 220,000 in Los Angeles County, California, recently signed a dark fiber lease agreement with Southern Californian telecommunications provider Wilcon. The city hopes to improve high-speed Internet access for local businesses; this ten-year contract allows Wilcon to provide services via publicly owned fiber-optic cable originally buried for traffic controls.
The New Agreement
From the City Council’s June 28th agenda, the new agreement includes the following:
- Initial anticipated annual revenues of $72,256 based on $840 per year per fiber mile.
- Annual fiber lease rate adjustment based on [Consumer Price Index] (CPI) for the Los Angeles area.
- Initial anticipated lease of 86.02 total fiber miles.
- City maintains control and ownership of all fiber at all times.
- Lease of dark fiber is not exclusive to Wilcon.
- City may opt out of the contract without cause after ten (10) years.
Santa Clarita and Wilcon can extend their agreement on identical terms for three consecutive periods of five years following the original ten-year term, leading to a potential contract length of twenty-five years.
Using Existing Assets To Promote Business Connectivity
The third largest city in Los Angeles County is home to the Six Flags Magic Mountain amusement park, a handful of aerospace engineering firms, several medical equipment manufacturers, and a strong business community. Yet, local industry groups like Santa Clarita Business Journal (SCBJ) identified unaffordable Internet access as a major barrier for local businesses, as highlighted by its May 2015 publication.
The City Council recently published its 2020 Goals, which include two Internet-specific objectives:
- Work with the Economic Development Council (EDC) to provide recommendations and strategies on how to ensure high-speed Internet access to business parks.
- Establish a revenue-generating program that utilizes existing infrastructure to...