Fiber optic communication network projects are increasing in the city and the public works department noticed that their current permitting and fee structure couldn’t keep up.

Staff is recommending a new fee structure for these projects and the City Commission will hold a public hearing to consider the changes during their Feb. 15 meeting, which begins at 7 p.m. in the Commission Chambers, upstairs in the Civic Center.

“The scope and scale of many of these projects have increased significantly from those we have experienced in the past,” according to the public works staff report. “With this new type of development coming to the City of Great Falls, a new, more applicable type of fee is necessary. It is uncertain at this point how the ongoing global pandemic will effect new development and city growth in the future; however, initial indications are that digital communication networks will be ever more important, making these fees relevant, timely and necessary.”

City continuing discussion of use of $19.47 million in ARPA funds during Jan. 4 meeting

Staff is proposing a new linear underground permit fee and an annual linear underground fee to help recoup costs for review and permitting the projects “and maintain an ongoing inventory of the location and administrative record for these projects,” according to staff.

The engineering division of the city’s public works department reviews and inspects construction in the city’s rights-of-way.

During 2021, staff said they were contacted and worked with multiple communication providers proposing projects in the city that ranged from fiber optic communication network cables capable of servicing every home, to single trunk line projects and dark fiber networks for third party entities, according to staff.

The current right-of-way permits and fees are based on the above ground footprint of the proposed encroachment and occupation, which doesn’t work well to the communication cable utility projects, according to staff.

Under the current permit and fee structure, these communication utility projects would be charged $1 per square foot per yet, “which is difficult to apply to a subsurface linear project,” according to staff.

The engineering division looked at what other cities have implemented for fibe, particularly Billings, which recently revised their fees to $2 per lineal foot in combination with an above ground assessment based on the appraised value of the proposed infrastructure for aerial installations, according to staff.

The division has also used a consultant to review industry norms and trends.

According to the staff report, Madison, Wis. charges $2 per foot for 2-inch conduit and $4 per foot for 4-inch conduit; Chandler, Ariz. charges a flat rate of $2.27 per foot; the average fee in California is about $1.29 per foot; Las Cruces, N.M. charges a two percent fee based on the revenue generated by the fiber.

Right-of-way fees have been adjusted over the years to address new or changing permitting needs, according to staff.

Revenues from the inspections are directly related to the level of development and construction activity and types of work being performed so the city’s revenue from the new fees will vary from year to year, according to staff.

“Approving these fees will allow the city to curb its costs associated with reviewing these linear projects to ensure protection of existing city infrastructure; as well as, facilitating development in an orderly and predictable fashion. Further, the proposed annual fee will help the city recover its cost to integrate and maintain relevant information for these new underground installations in its GIS based asset management system,” according to staff.

Staff is recommending approval of the new fee structure as denial would keep the current structure, which is “contrary to industry norms and may result in discouraging development of these types of projects. Additionally, maintaining the current policy would result in significant workload for city staff to calculate and verify applicable area-based permitting fees. Finally, without the proposed annual fee the city would not have the resources to track, inventory and manage the information necessary for the city to effectively manage orderly development in its right of way into the future,” according to staff.