By Emily Ford
eford@salisburypost.com
SALISBURY — A controversial bill regulating city-owned broadband networks like Fibrant passed the N.C. Senate Tuesday with Salisbury’s exemption intact.
“This is an outstanding result for our city, and it is extremely important for our citizens to understand that this is a successful resolution,” Mayor Susan Kluttz said in a statement. “We are very pleased that our investment is safe and secure.”
Salisbury leaders and other opponents of House Bill 129 convinced lawmakers to carve out full exemptions for the handful of North Carolina cities that borrowed millions of dollars to launch broadband networks.
Leaders argued that anything less than full exemption from taxes, fees and restrictions in the bill would harm the cities’ ability to pay back their debt. N.C. Deputy State Treasurer Vance Holloman recommended that legislators exempt broadband cities.
“It was a hard-fought campaign,” Councilman Paul Woodson said Tuesday night at the City Council meeting.
After approval by a wide margin, the Senate sent the bill back to the House. N.C. Sen. Andrew Brock, a Republican representing Rowan and Davie counties, said he expects quick concurrence.
The bill then would go to Gov. Bev Perdue for her consideration.
Three top Salisbury officials — Kluttz, City Manager David Treme and Assistant City Manager Doug Paris — missed the City Council meeting Tuesday so they could be in Raleigh when the N.C. Senate gave final consideration to the bill.
That’s how important Fibrant is to the future of Salisbury, said Mayor Pro Tem Maggie Blackwell, who ran the meeting in the absence of Kluttz.
“We felt they had to be in Raleigh to protect our investment,” Blackwell said.
The city issued $35.86 million in bonds in 2008, including $33.56 million for Fibrant.
For four years, the cable industry has backed legislation targeting government-owned telecommunications systems like Fibrant, which compete with private companies like Time Warner Cable.
Supporters of House Bill 129 say it will protect taxpayers by requiring voter approval before a city borrows money to launch a broadband system.
“After four years, this issue is now successfully resolved for the city of Salisbury,” Kluttz said. “We would like to thank our local delegation for their leadership in securing this exemption.”
An amendment to the bill sponsored by Brock allows Salisbury to sell Fibrant nearly anywhere in Rowan County, as long as town aldermen, county commissioners or school board members vote to approve the expansion.
Brock also sponsored an amendment requiring cities to comply with the state’s open bidding procedures if they try to sell broadband services to economic development sites outside the service area.
Although state law already requires cities to hold open bidding, Brock said he still wanted the language included in House Bill 129.
“We are trying to craft it just right so our intent is very clear if it gets challenged in court,” he said.
City Council voted in March to pursue a full exemption after consulting with City Attorney Rivers Lawther as well as Jim Baller, a communications attorney in Washington, D.C. The city also hired its first lobbyist in March at $5,000 a month in the battle over broadband.
Contact reporter Emily Ford at 704-797-4264.

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No rate hike for Fibrant
Fibrant customers will not pay more next year, according to the proposed 2011-12 budget.
Staff at Tuesday’s City Council meeting recommended no increase in charges for Fibrant, the city’s fledgling broadband network.
“We are going to hold the line,” said John Sofley, city finance director who was recently promoted to assistant city manager.
Fibrant, which began selling Internet, cable TV and phone services in November, has about 850 customers.