The City Council is asked to adopt a Resolution to: 

1.      Authorize the City staff to prepare policies that increase accessibility to high speed internet to Union City Commercial and Industrial areas; and

2.      Authorize the City Manager to execute a $318,651.51 contract with Communication Network Resources, Inc. (CNR) to install dark high speed fiber along 11^th Street between Decoto Road and Cheeves Way to service the three blocks that will be developed as office by Woodstock Development; the two blocks that will be developed by Windflower as housing and live work lofts; and the Station Center affordable family apartments.

On January 2, 2015, the City Council adopted the City’s first Economic Development Strategic Plan (Plan).  The Plan included a business retention strategy to enhance business access to high-speed broadband.  City’s ability to retain and attract businesses is aligned with accessibility to this essential utility. 

The City of Union City commissioned a “Commercial/Industrial Broadband Infrastructure Analysis” (Broadband Report) to evaluate current accessibility and quality of internet services available to businesses in the commercial/industrial areas of the City.  The report concluded that the business and industrial areas of Union City have inadequate internet services. The report suggests broadband polices, that if adopted, can over-time increases accessibility to high-speed internet in our commercial/industrial areas at more competitive prices.  

Staff engaged the services of Stephen A. Blum, President, Tellus Venture Associates (TVA) ^[1] to evaluate Union City’s broadband accessibility for the commercial and industrial sectors. TVA helps communities develop broadband policies, programs and networks that will help support existing businesses and provide an environment to attract new businesses. 

The Broadband Report paints a dismal picture of broadband accessibility, low quality and lack of service to the industrial and commercial sectors in Union City.  The key industrial areas of the City received an F grade.  (See Exhibit A)

The Broadband Report recommends that the City Council consider three general initiatives to upgrade commercial and industrial broadband infrastructure and service availability:

·         Develop a detailed geodatabase of City-owned traffic signal and street light conduits. Based on the condition of the conduits, staff can evaluate options of utilizing existing conduits to create a municipal broadband utility and/or offer surplus space to interested telecommunication companies.

·         Enact policies that promote telecommunications competition and/or enhance accessibility to internet services, such as by: requiring any entity seeking an encroachment permit to trench in  City streets to install conduit for the City that can accommodate high-speed fiber to service businesses and residential areas; formulate master lease agreements for use of city telecommunications assets; update development standards for new construction; develop asset management procedures such as routine GIS logging of broadband infrastructure; develop standard specifications for conduit and broadband facilities, and update permitting procedures.

·         Determine a preferred business model for management and use of city-owned conduit.

Staff will present its recommended technical polices to the City Council for adoption at a future meeting.

Staff has prioritized the Station District as the first phase of City-wide broadband strategy. The Station District has existing conduit in place that provides the opportunity for the City to install and own high speed dark fiber that will provide faster internet services to businesses and residents than are currently available from commercial internet vendors.  

Communication Network Resources (CRN) provided the most comprehensive response to the Station District “Request for Proposals” (RFP) to install high-speed fiber optic cable in city-owned conduit.  CNR installed high speed dark fiber to service Super Bowl 50.  All television stations and reporters covering the Super Bowl 50; internal communications; connection with Homeland Security; and communication between San Francisco and Santa Clara activities utilized the fiber installed by CNR.  CNR is proposing to:

1.      Install dark fiber that will serve the three blocks that will be developed as office by Woodstock Development; the two blocks that will be developed by Windflower Properties, LLC as residential and live Work Lofts; and the Station Center affordable family apartments.  (See Exhibit B)

2.      Each paying customer will have the opportunity to purchase up to 10 gigabytes per second of uninterrupted capacity.  This speed of service is of sufficient capacity for most high tech Silicon Valley businesses.  By way of contrast, no commercial vendors offer high speed fiber to residential consumers at 10 gigabytes.  The service offered at the Station District will be thousands of times faster than the top residential service now provided by AT&T.

3.      Provide technical specification for the installation of lateral connections from the City-owned fiber optic lines to the privately owned parcels along 11th Street.  The private sector would build the lateral connection to the City-owned fiber when the parcels are developed and when existing developed parcels wish to connect to the City-owned fiber.

4.      The internet infrastructure will provide capacity for Wi Fi along 11^th Street.

5.      Provide connections to at least two independent fiber optic networks that provide connectivity to Tier 1 Data Centers.  The BART Phase 2A project currently under design will provide connectivity between the City’s dark fiber to BART’s backbone fiber.

6.      The high-speed dark fiber design will be expandable to other parts of the City as funding becomes available. 

The City will need the two actions to activate and energize the fiber and provide service for the businesses. 

1.      Union City will own the fiber, but not be the vendor that provides internet services.  Staff is researching the best options for the City to lease the use of the fiber to internet providers, not lose control of the fiber, ensure high speed uninterrupted capacity for Union City businesses and residents, and City receipt of royalty payments for use of the fiber from internet providers.

2.      Staff is in negotiations with BART to lease the use of a portion of its high speed fiber in the BART right-of-way. 

3.      Staff will need to negotiate the use and connectivity to a second independent fiber optic network.

4.      Pending City Council authorization, there is the opportunity to provide high speed dark fiber as a second phase for the remainder of the 80 acre Greater Station District when new streets are constructed and the area is developed.  The City-owned high speed dark fiber will provide an incentive to recruit high tech businesses.      

Adoption of the resolution will not impact the budget.  Installation of the dark fiber will be funded with an existing City Council appropriation from 2011 Bonds, Fund 4160.

Staff recommends that the City Council adopt a resolution to:

1.      Authorize the development of City policies that increase accessibility to high-speed internet in Union City’s commercial and industrial areas; and 

         2.         Authorize staff to execute a contract with Communication Network Resources in the amount of $318,651.51 to install dark fiber in City-owned conduit at the Station District