ROCK FALLS – The City Council on Tuesday unanimously approved a deal to lease the city's fiber broadband system to Surf Broadband Solutions for the build out of the network to residents and businesses within the city.
The lease-to-own deal is worth $2.25 million with the city retaining ownership of the network for now.
"It's going to mean [citizens of Rock Falls] will have fiber to the residences and their businesses," Surf Broadband CEO Greg Armstrong said. "Which will deliver to them up to 1 gig speeds in both directions. It's a real advantage to the city in order to advertise as a gig city, it's an advantage to the consumers on the commercial and residential side, particularly if there's more work from home and schooling from home."
The city set out in 2015 to make broadband a city utility, but ran into several issues from costs to Google discontinuing the Fiberhood construction method in 2018 when it was shown to be ineffective. Rock Falls reached out to other partners in 2019, with SurfAir, now rebranded as Surf Broadband Solutions, entering talks with the city in November 2019.
"We started the journey years ago wanting to bring fiber to the home, high-speed internet, becoming a gigabit city," Rock Falls Mayor Bill Wescott told the council on Tuesday. "Unfortunately, along the way we hit some bumps in the road, but our vision remained the same, and that was to not have Rock Falls be another one of those rural communities out in the middle of nowhere that people cannot access the rest of the world and work and improve the quality of life."
Surf Broadband has served northwest Indiana, southwest Michigan and northeast Illinois since 2010. Armstrong said his company was excited to get started.
"We are very interested in expanding our fiber footprint," Armstrong said. "We saw this as an opportunity to work with the city and provide an opportunity that the city needs and wants. It seemed like a good match."
A deal for Surf to buy the network outright came before the council in September, but concerns by council members put the deal on pause at that time before some of the details were reworked.
The deal approved Tuesday includes a 10% down payment to the city with the remainder to be paid off over 10 years at 5% interest. The city will also receive 5% of the gross revenue from Surf Broadband Solutions for 10 years, with the option to renew.
Armstrong said work will begin by the end of the year.