Bountiful council lifts fiber loan cap to $8M instead of $10M, keeps five-year term

The Bountiful City Council on Oct. 13 amended and adopted Resolution 2026-14, raising the cap on a loan from the city's Capital Projects Fund to its Fiber Fund from $5.5 million to $8 million. The council left the five-year term unchanged and asked for an annual status report on fiber subscriptions and the loan. The motion passed unanimously on a voice vote. ^[1][2][3]

City staff had recommended a larger change. The packet proposed a $10 million not-to-exceed amount and a ten-year term, measured from the first installment on Sept. 4, 2023. Staff wrote that it did not expect the full $10 million to be needed, but that the terms would allow the loan to continue until fiber operations could repay it. ^[1]

Council Member Dan Bell said he was not comfortable with the $10 million and extra five years in the draft. He moved to raise the limit to $8 million and keep the term, and said the council should revisit the loan each year. Council Member Beth Child seconded. ^[2]

The loan covers debt service on the $45,525,000 in sales tax revenue bonds issued Aug. 3, 2023 to build the city's fiber network. The bonds did not include money for the early years, when subscriber revenue was expected to fall short, so the city planned to use Capital Projects Fund reserves. ^[1]

The packet says the loan balance reached $4,864,965 at the end of September and would likely pass the $5.5 million cap by the end of the year. Staff estimated fiscal year 2028 before subscriber revenue covers debt service, and fiscal year 2029 as the first year of loan principal repayment. The Fiber Fund has paid all accrued interest through September 2026, using interest earned on bond proceeds. ^[1]

Mayor Kate Bradshaw read a message from Council Member Matt Murri, who was excused and traveling for work. He supported the network and the loan structure, calling it a planned bridge until subscriber revenue covers operations and debt service, but said doubling the loan at this stage felt premature. He suggested a smaller increase and a longer term. ^[2]

Bell said the $3 million increase was meant to cover debt service. Staff said they would return in a year with an update, and likely sooner. ^[2]