Council advances and adopts several measures including fiber connectivity and surety bond fund; multiple ordinances introduced

The Bloomington Common Council on Sept. 17 introduced several ordinances for second reading and acted on a group of items tied to the city's fiber network and a contractor surety bond.

Key actions

- The council unanimously adopted Ordinance 20-25-34 to establish a dedicated fund to hold $1,000,000 the city received from a surety bond tied to Meridian/M Street Fiber subcontractor work in the public right-of-way. Corporation Counsel Margie Rice explained the fund will hold the payment while departments determine whether the proceeds are needed for right-of-way repairs, fines or other lawful city purposes. The council clarified the fund will be used for city purposes, not payments to private individuals. The vote was recorded by roll call and the ordinance passed unanimously.

- The council adopted Ordinance 20-25-33, establishing a fiber connectivity fund to support digital opportunity initiatives and to underwrite connections for income-eligible households. Controller McClellan and ITS Director Rick Dietz explained the ordinance implements a city commitment in a master development agreement with Meridian (now referred to as M Street Fiber). Council adopted an on-the-floor amendment adding the word "nonreverting" to section 1 so funds remain in the dedicated fund and do not revert to the general fund. After amendment the ordinance passed unanimously.

- The council introduced for first reading (to be heard for second reading on Sept. 30) two water-related ordinances: Ordinance 20-25-35 (amending Title 9, Bloomington Municipal Code, to adjust water rates) and Ordinance 20-25-36 (authorizing the issuance of waterworks revenue bonds not to exceed $71,000,000 to fund capital improvements, portions anticipated in 2026 and 2028).

- The council introduced two appropriation ordinances for ITS and related ITS/engineering expenses (Appropriation Ordinance 20-25-08 to transfer funds to the fiber connectivity fund, and Appropriation Ordinance 20-25-09 to appropriate general fund expenditures not otherwise appropriated). These were moved and recorded for introduction; second readings and any required public hearings will take place at the Sept. 30 meeting.

- The council passed two resolutions: Resolution 20-25-16 (requesting the Food & Beverage Tax Advisory Commission recommend expenditures for the Capital Improvement Board's 2026 capital budget) passed 8-1; and Resolution 20-25-15 (establishing expectations and procedures for councilmember liaisons to boards and commissions) passed unanimously.

Discussion highlights

Corporation Counsel Margie Rice and City Engineer Andrew Seabor summarized the background behind the $1,000,000 surety-bond payment: work performed by a Meridian subcontractor, AEG (aka True Line), resulted in right-of-way violations; the city submitted a notice to the bond issuer (Sampo International d/b/a Lexon Insurance Company) and received the payment July 8. Rice said departments including engineering, public works, ITS and the controller's office compiled materials and have been coordinating remediation and a response from Meridian and a new contractor.

Council members asked whether the funds could be used only for repairs in the right-of-way or for broader lawful city purposes; Rice said the fund would be available for city needs but confirmed the money will not be paid to private individuals and confirmed the city expects Meridian and its new contractor to undertake the necessary repairs.

On the fiber connectivity fund, Controller McClellan said the city plans to appropriate $250,000 this year (with additional $250,000 installments over four years to reach a $1,000,000 commitment) to support low-income household connections; M Street Fiber is contractually responsible to match or exceed the city's contribution under certain conditions. Eligibility for the subsidized connection follows lists of existing low-income program participants (SNAP, HUD vouchers, free-reduced lunch, etc.) as defined in the original development agreement.

Public comment included questions about contractor bankruptcy exposure and satisfaction with the network rollout; M Street Fiber and city staff said restoration and remediation work is ongoing and that customers who have connected report positive service, while construction activity resumes under a revised timetable.

Next steps

Most introduced ordinances are set for second reading and public hearing Sept. 30. Council staff will return with appropriation requests to fund the fiber connectivity commitments and departments will continue to catalogue right-of-way repairs and propose appropriations from the surety-bond fund as warranted.