Chebeague Island Broadband

The Axiom Contracts – A Summary in Non-legal language

By the Broadband Committee

Introduction:

Following the December 2021 Town Meeting to approve a broadband system, the Town attorney advised the Select Board to have a separate Town Meeting to approve the contracts to build and operate the system because they are multi-year agreements. The articles to approve them passed at Town Meeting on June 11, and the official contracts may be seen  here. We also thought that a summary might be helpful to people who have little patience with legal language.

1.    Construction Agreement

The Construction Agreement is really pretty simple. It says that Axiom will construct a state-of-the-art fiber network, with fiber cable running to each house or business that wants it. The system will be capable of 1 Gbps for each subscriber, for both upload and download, and will have latency (or ping rate, the round-trip time for messages) of 25 ms. or less. The network is at least future-resistant, if not entirely future-proof, in that it can be speeded up to carry 10 Gbps for each subscriber with only an electronics update.

In the contract, the Town agrees to pay Axiom in stages, but only after defined milestones are reached. The final payment is withheld until testing (by a firm of outside engineers retained by the Town) is completed and satisfactory.

The rest of the agreement is basically protections for the Town, like insurance.

The system will cost about $1,600,000, but we received an $800,000 grant, so we will get it at half-price!

2.     Franchise Agreement

This agreement controls Axiom’s operation of the network and provision of services. Three levels of service are called out ( all of them much faster than anyone is getting over DSL today), and a fourth is available.

These rates are all-inclusive, there are no added fees or taxes unless you want to rent a router, and there is no real reason to do that since a perfectly good router can be bought for $50.

Any of these rates are available to Seasonal Residents at the given rate for 6 months (May-October) and a $20 Maintenance Fee for the other 6 months of the year (just about each subscriber’s share of the construction cost).

Axiom will participate in the Federal Affordable Connectivity Program, which gives a $30 discount to qualified subscribers.

These rates will not change for at least 4 years.  The Agreement provides for an automatic performance review every 4 years, and at that time Axiom can ask for an increase, but the Town must approve before that can happen.

In return for the use of our network, Axiom will pay an annual fee equal to the debt service on the bond used to build the system (about $60,000) and either:

The cost of liability insurance required by pole owners (if any is required), or

$10,000 toward eventual system upgrades.

Zoom meeting was held on June 9, 7:00 pm, on the Town Zoom to answer any questions.