Wired: Mayor’s proposed budget to fund citywide fiber internet project

This map shows where KentuckyWired and the city plan to install fiber optic cables for high-speed internet development. | Courtesy of Louisville-Jefferson County Metro Government

This story has been updated.

Louisville Mayor Greg Fischer wants to invest $5.4 million to install fiber optic cables across Jefferson County, he announced Thursday as part of his proposed fiscal year 2018 budget.

“The fiber investment lays a foundation for future investments in ‘Smart City’ technologies, transportation, digital inclusion, public protection, and provides faster connections to existing metro facilities,” according to the mayor’s budget.

The city would piggyback on a state-led public-private venture called KentuckyWired, which aims to create a network of fiber cables to bring high-speed internet connectivity to the entire state. The initiative was started under Gov. Steve Beshear and is overseen by the Kentucky Communications Network Authority.

Grace Simrall, the city’s chief of civic innovation, explained that through KentuckyWired, a for-profit company, Macquarie Capital, is fronting the infrastructure costs related to installing fiber optic cable lines along major thoroughfares across the state. The state will repay the company for that work over time.

Most of the work will be done using above ground utility poles, but some fiber cables will be run underground. It is not expected to cause major disruptions.

Louisville-Jefferson County Metro Government now has a related agreement with Kentucky Communications Network Authority where Macquarie Capital will install fiber optic cables for the city to use next to the cables it is installing for the state. The city simply has to pay for the cables themselves. Work began in Jefferson County in April and will move from east to west.

If Metro Government had to pay to run the cables, Simrall said, the estimated cost would have exceeded $15 million, factoring in the engineering, construction and other expenses, as compared to the $5.4 million it is costing through the partnership with Macquarie Capital and the state.

Under the initiative, the Louisville’s fiber optic cable network would stretch across roughly 96 miles in Jefferson County, covering nearly every Metro Council District, she said. It currently traverses 21.3 miles.

Notably, half of the $5.4 million estimated cost will cover only as small portion — about 6.6 miles — of the cable line, Simrall said. The state’s KentuckyWired plans don’t include West Louisville, so the city is in talks with Macquarie Capital about using its crews to install cable along Broadway and 22nd Street.

Because it is not part of KentuckyWired, the city will have to pay for the engineering, construction and other expenses that it doesn’t have to elsewhere.

Grace Simrall | File Photo

“It speaks to our desire to ensure digital inclusion for our community, so we are prioritizing that,” she said. “It’s telling how half of the budget is for a relatively small section. That’s how expensive construction costs are.”

The expansion of fiber optic cables into West Louisville goes hand in hand with the creation of the Gigabit Experience Center at the nonprofit Louisville Central Community Centers, at 1800 W. Muhammad Ali Boulevard. The center will give resident access to “ultra high-speed internet,” according to the city.

The remaining $2.7 million is how much it will cost to run the cable in the rest of the Jefferson County in tandem with KentuckyWired.

The project won’t run fiber optic cable to homes and businesses but along main thoroughfares such as Westport Road, Dixie Highway and Hurstbourne Parkway. However, once it’s installed, the idea is that private internet providers will do the remainder of the legwork needed to bring the high-speed fiber internet cables from the major transportation corridors into private homes and businesses.

Metro Government will use about half of the cable’s capacity for its own purposes, including connecting police stations and public security cameras, as well as providing high-speed internet at city-owned properties.

Private internet service providers such as Google and AT&T will be able to bid on a lease or leases to use the remaining capacity.

Having the cable lines in place will attract investment from private companies because “it’s not just a cost savings, it’s an acceleration in their project schedule for implementation,” Simrall said.

It is unclear if multiple providers will be able to tap into the city’s fiber cable network.

“It depends on their capacity needs,” she said.

The opportunity to lease capacity could fuel a fight between Google and AT&T. The latter has sued the city after the passage of the “one touch” ordinance that allows Google or other broadband service providers to rearrange other companies’ equipment on utility poles — an ordinance the city passed to persuade Google Fiber to come to Louisville.

On Wednesday, Google Fiber officially committed to rolling out gigabit internet services in Louisville. The company is expected to file for building permits soon. It’s unclear whether Google Fiber will look to lease space on the city’s cable lines rather than construct its own.

AT&T already offers the high-speed internet through its AT&T Fiber service in parts of Jefferson County but hopes to expand its coverage area.

The city is expected to see a return on its investment in five years, even if it doesn’t lease the addition capacity, Simrall said, noting that the city will need more capacity in the future, so there could come a time when it doesn’t allow private providers to use the cables.

This is the largest investment in technology that the city has made in terms of the breadth of the project, Simrall said, but not in terms of actual dollars spent. “That’s why we are so excited about it,” she added.

The $5.4 million will be part of a $68.9 million bond the mayor’s budget proposes taking out to cover other infrastructure projects, such as sidewalk repairs and roadway maintenance, as well as the purchase new emergency services vehicles, the construction of the Northeast Regional Library and funding for Louisville CARES.

Editor’s Note: An incorrect number was provided to Insider Louisville regarding the number of miles of cable that will run through West Louisville. It has been changed to reflect the correct mileage.