Council schedules second reading for Forged Fiber 37 LLC franchise; staff explain nonexclusive rights-of-way access and protections
Get AI-powered insights, summaries, and transcripts
Subscribe
Summary
On first reading the council learned Forged Fiber 37 LLC (an AT&T subsidiary) seeks a nonexclusive telecommunications franchise to operate existing fiber in the city rights-of-way; the council voted to schedule the ordinance for a second reading.
Councilmembers held the first reading on a telecommunications franchise application from Forged Fiber 37 LLC, a wholly owned subsidiary created as part of AT&T's purchase of certain Lumen fiber assets.
Proposal explained: Transportation engineer Rebecca Corigliano introduced the item and outside counsel Daniel Kenny explained that Forged Fiber seeks a nonexclusive franchise to occupy existing fiber facilities in Mercer Island's rights-of-way. Kenny emphasized the distinction between a franchise (permission to occupy rights-of-way under terms the city requires) and operational regulation (which the city does not impose). He said the franchise includes a deposit to cover city review costs and that ongoing franchise fees cannot be charged for this type of telecommunications franchise (statutory limitation applies to cable franchises only).
Insurance, indemnity and permitting: Kenny told council the franchisee must carry insurance and comply with permitting and bonding requirements for work in the right-of-way; councilmembers asked about the risk of a single-purpose LLC (Forged Fiber 37) and whether indemnification would be effective if the LLC lacked assets. Kenny said the city's protections are the insurance and indemnity provisions in the franchise and permitting requirements and that the city cannot dictate which legal entity applies for a franchise.
Competition and buildout: Councilmembers asked whether approval would limit other providers. Kenny said the franchise is nonexclusive and other firms could seek similar agreements; he noted Forged Fiber is taking over existing facilities so it will have operational scale but the city cannot require buildout across the entire service area.
Council action: Councilmember Reynolds moved and another councilmember seconded a motion to schedule Ordinance No. 26-01 (the Forged Fiber 37 LLC franchise) for a second reading and adoption at a future meeting; roll-call vote passed unanimously.
Why it matters: the franchise governs how private fiber infrastructure occupies public rights-of-way and establishes city protections (insurance, indemnity and permitting) while not regulating wholesale service decisions. Councilmembers sought assurances about local service benefits and protections for the city should the applying entity be a narrowly capitalized subsidiary.
Next steps: second reading and formal adoption will be scheduled; staff said the applicant will proceed with any permitting needed for construction or modifications after franchise approval.