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Politics, conflicts of interest muddy future of Toledo’s network

May 31, 2007 at 6:44 PM by Esme Vos

The city of Toledo set the record straight Thursday after The Toledo Blade misleadingly reported that “Toledo taxpayers could pay up to $2.16 million over five years” if the city council approves a license contract with MetroFi and a city councilman jumped on the story to make political hay.This story is becoming one where you need a scorecard to know the players. We hope it does not erupt into a confrontation with delays on the scale of what we saw in San Francisco.

It started with The Blade’s report Thursday morning that “‘Free’ Wi-Fi could cost Toledo taxpayers $2.16M.” In it, Councilman Frank Szollosi, longtime opponent of Mayor Carty Finkbeiner, used the claim to attack the project in general (one of the mayor’s key initiatives) and its choice of MetroFi, in particular, to do the job, saying “If they’re (MetroFi) going to be asking council to approve money out of the city budget, why not go with a local union firm that is already doing it?”

By doing so, Szollosi no doubt curried favor with Block Communications which not only owns Buckeye Communications, the company that lost the bid to MetroFi, it also owns The Blade. He evidently was also trying to repair his damaged relationship with local unions after he enraged the police and fire unions over accusations he made alleging officers abused overtime with the mayor’s permission.

The fundamental problem with Szollosi’s accusation–and The Blade’s–is that they’re putting the city on the hook for something they’re really not on the hook for in an effort to arouse opposition to the city’s choice of MetroFi as the network provider.

MetroFi has not asked the council to budget a cent of new money toward the network, a fact that was pointed out by Dr. Patsy Scott, the city’s director of information and communication technology, (but buried deep) in The Blade’s story. Her explanation in the article did not stop Szollosi from calling a press conference later in the morning to reiterate his opposition to reiterate his opposition to the contract which will be presented to the city council for approval on June 12.

Later in the day Thursday, the mayor fired back with his own press conference where Scott, Dr. Todd Davies, Toledo’s commissioner of economic development, and Councilwoman Betty Shultz, chair of the city’s Information Systems committee, explained the contents of the contract which has not yet been presented publicly.

I spoke with Scott following the press conference. She described the Blade story as “totally misrepresented” and outlined the three key points made at the city’s press conference.

  • “It’s a directive from the city that the MetroFi project has to be “zero sum’ to the budget.” MetroFi was given a minimum annual revenue commitment (MARC). That MARC is the $2.16 million that the Blade cited in its story. The MARC is not an annual number but a commitment that is spread over five years. The city would meet the commitment by becoming an anchor tenant on the network, paying MetroFi for services that would move to the network once it is deployed; these include $1.2 million over five yearsfrom Scott’s budget “that pays for circuits we have to have. All we’re going to do is take the functions of these circuits and redirect them” to the new network. She emphasized that the money is already budgeted for necessary IT services that will be transferred to the network after its construction and that the funds could not be used for any other purpose than to provide those services. She also said the city would be under no commitment to make up any shortfall in advertising revenue if MetroFi is unable to sell enough ads on the network to offset the cost of a free tier of service. “That would be MetroFi’s responsibility,” she said.
  • The city did due diligence on this on MetroFi’s proposal, communicating with officials in other cities where MetroFi has deployed networks. “We learned from their mistakes and we’re taking advantage of information about their successes,” Scott told me. “We’ve done lots of reference checking. We’ve worked with other companies to check out the validity and viability of MetroFi networks and it comes back very solid. In fact, as we checked this out, we came to think the MetroFi model is much more solid than those that are dependent only on subscriptions.”
  • Finally, they addressed the issue of the competing proposals. Buckeye, she said, did not submit a valid proposal. We have–as all cities have–procurement policies. We issued an RFP and in response to that RFP, Buckeye only submitted a letter. They really didn’t submit a proposal. We cannot consider a letter a proposal.”: She added that, in the letter, Buckeye said they did not understand the city’s RFP despite the fact that there was an opportunity for bidders to question the city about and receive answers in writing.

    • Davies told those at the press conference that MetroFi has committed to use local contractors to build the network and, despite accusations that the projects would divert city funds to California, Toledo people would be employed.

    Further, said Scott, the network is being deployed to enable public safety applications and enhance public services. “This will truly benefit our public safety people and they are very much behind it,” she said.

    Scott told me she welcomed the opportunity to dispel confusion about the contract. Hopefully, come June 12, it can stand on its own merits before the Toledo council and the community as a whole.

    Click here to read the controversial story that started the exchange.

    Related posts:

    1. The continuing saga in Toledo, Ohio
    2. Toledo, Ohio, puts Wi-Fi on ice
    3. Toledo RFP nets two proposals
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