The City of Fort Bragg is moving ahead with its ambitious plan to deploy municipal broadband despite an unexpected increase in costs.
Last November, City Manager Isaac Whippy told the council to expect finalized funding commitments by January with construction expected to begin by April 2025. But that schedule has slipped.
Initial projections had pegged the gap at $3.5 million to $4.5 million. But when construction bids came in, they were $2.5 million to $3 million higher than expected, bringing the total shortfall closer to $8 million.
“In November, we were given direction to go out and find money for approximately a $4.5 million gap,” said Eric Scriven of NHA Advisors. “That number changed significantly when the bids came in.”
Scriven said his firm solicited bids from multiple banks, with priorities including low interest rates, flexible prepayment terms, and most importantly, limiting the city's financial risk.
“The important piece we went out with was reducing or eliminating, if possible, the city’s general fund as a backstop,” Scriven said.
Of the four banks that submitted bids, two emerged as front-runners: Banner Bank and EverBank. Both offered 20-year terms and competitive rates, but EverBank stood out by providing a path for the city to eventually remove the general fund as collateral—if the broadband network proves financially self-sustaining.
“That’s the one differentiating factor,” Scriven said. “EverBank gave us the method for how the city could remove the backstop of the general fund.” Once the broadband project proved itself, the loan would then be backed solely by broadband-generated revenue.
Sarah McCormick, the city’s economic development manager, addressed why the original cost estimates were so far off. She said the initial application for federal funding was rushed due to tight deadlines.
“We just really put the pedal to the metal to make sure we had something solid,” McCormick said. “Since then, we’ve been refining and reworking it.”
Despite the unexpected costs, council members and the public expressed strong support for the broadband initiative. Mayor Jason Godeke acknowledged the risks but emphasized the long-term potential.
“I think we’re seeing over and over again that things just end up costing more than anticipated,” Godeke said. “But when you think about the kinds of things a city government can do to diversify our economy and create jobs, this is a very concrete mechanism for doing exactly that.”
The council voted unanimously to move forward with EverBank’s loan offer and the construction of the municipal broadband network.
