Agenda Index City of Vancouver

ADMINISTRATIVE REPORT

TO:

Vancouver City Council

FROM:

General Manager of Engineering Services

SUBJECT:

Interim Agreements with Novus Telecom Inc. and Intrigna Communications Inc.

 

RECOMMENDATION

GENERAL MANAGER’S COMMENTS

The General Manager of Engineering Services RECOMMENDS approval of A and B.

COUNCIL POLICY

Execution of legal agreements by the Director of Legal Services requires Council approval.

On July 30, 1996, when dealing with a report on Telecommunications Policies, Council approved a number of goals including one to ensure that the City maintains its authority to regulate equitable access to rights-of-way, secure valuable compensation for their use, minimize negative impacts associated with their use, and utilize them in a manner that furthers other telecommunications policy objectives.

PURPOSE

This report seeks Council approval to authorize staff to negotiate and execute agreements with Novus Telecom Group Inc. and Intrigna Communications Inc. to allow them to install fibre optic cable in the City of Vancouver.

BACKGROUND

Novus Telecom and Intrigna Communications are telecommunications companies that have recently approached the City for authorization to install fibre optic networks in City streets.

Novus Telecom is a new company that intends to provide voice, video and internet services to high density residential buildings in the City. This company is trying to save on street excavation costs for its installations by utilizing available third party duct space. They are also interested in utilizing ducts installed by the City as part of the Dedicated Fire Protection System (DFPS) project as the core of their downtown network, as well as abandoned BCGas mains.

Intrigna Communications is a joint venture between Bell Canada and Manitoba Telecom Services Inc. set up to provide telecommunications services in western Canada. Intrigna is also attempting to minimize street excavation costs for its installations by using Telus duct space.

On July 8, 1999, Council approved general terms for an interim agreement to allow Worldwide Fiber Inc. (affiliate of Ledcor) to install fibre optic cable in the City. This interim agreement will expire 90 days after the CRTC issues a decision on Vancouver’s case against Ledcor, Telus, Bell Canada, and Call-Net. At that time, a new agreement with Worldwide Fiber Inc. will be negotiated based on the CRTC decision. Under the interim agreement, Worldwide Fiber Inc. pays the City for up-front costs associated with permit application reviews, inspection of construction, traffic signing costs, lost meter revenues and street pavement repairs. While the City will recover these up-front costs, street access fees will be set at $0 initially, and any access fees payable pursuant to the CRTC decision will apply retroactively to the date of installation of any fibre optic cable.

The CRTC has initiated a public proceeding on appropriate terms and conditions for telecommunications companies’ use of City streets. This proceeding will allow other interested parties to make submissions on this issue. City staff have recently made a submission outlining the City’s proposed terms and conditions and methodology for recovering costs and charging street access fees. It is expected that it will take at least eight months to respond to interrogatories from the CRTC and interested parties and for the CRTC to issue its decision.

DISCUSSION

To allow Novus Telecom and Intrigna Communications access to City streets, it is the intent to enter into an agreement with each company which is substantially in the form of the interim agreement between the City and Worldwide Fibre Inc. This is consistent with the City's policy to enter into an interim agreement with a telecommunication carrier wishing to install fibre optic cables on City property if that carrier is not prepared to enter into either a long term agreement with the City that is consistent with what the City is seeking from the CRTC or a long term agreement which is similar to that entered into with telecommunication carriers such as Metronet and Group Telecom. This will protect the City’s right to obtain fees from these companies retroactively following the CRTC decision, treat them equitably and allow them to proceed with the construction of their fibre optic networks. In preliminary discussions with Novus Telecom and Intrigna Communications they have indicated that they are prepared to enter into such agreements. For Novus Telecom’s use of the City’s ducts, an appropriate access fee needs to be negotiated as noted below.

Agreements with both companies would contain the following general terms:

· City to approve fibre locations and alignments
· Companies to pay for City costs related to administration and inspection associated with permit approvals, street pavement repairs, traffic signing and lost parking meter revenue
· Companies to provide as-built information relating to their facilities
· Companies to indemnify the City to the satisfaction of the Director of Legal Services
· Companies to pay for relocation costs where requested by the City

Since the two companies are planning to use third party ducts, the City must also enter into agreements with the duct providers to ensure the City receives appropriate access fees for the use of those ducts for telecommunications purposes. As a result, for portions of the Novus Telecom and Intrigna Communications networks, the City would receive access fees from the owner of the duct instead of directly from these companies. In the case of Novus Telecom’s use of abandoned BCGas mains, discussions are currently underway with BCGas regarding their relationship with the City in this arrangement. A separate proposal will be brought to Council on this shortly. Similarly, the City’s relationship with BCHydro will also need to be reviewed if one or both of these companies intends to use spare ducts owned by BCHydro.

In addition to the above terms, satisfactory arrangements will need to be worked out between the City and Novus for its use of City ducts including an appropriate fee. It is proposed that the General Manager of Engineering Services and Director of Legal Services be authorized to negotiate terms for the use of the City’s ducts as part of the agreement with Novus. If a fee can be negotiated that is consistent with the terms and conditions that the City is seeking from the CRTC, the agreement for the use of the City ducts would be for an agreed term (for example, 10 years) and would not expire on the CRTC decision. However, the agreement for any fibre optic cable installations beyond the City’s ducts would be subject to the interim arrangements identified above.

CONCLUSION

Staff recommend that Council allow installation of fibre optic networks in the City by Novus Telecom and Intrigna Communications subject to the execution of Municipal Access Agreements to the satisfaction of the General Manager of Engineering Services and the Director of Legal Services.

* * * * *

ag000215.htm

Comments or questions? You can send us email.
[City Homepage] [Get In Touch]

(c) 1998 City of Vancouver