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Holcomb cancels Pence's $260M cell tower contract

February 9, 2017

Gov. Eric Holcomb announced Thursday that the Indiana Finance Authority has “terminated" contract discussions with Ohio-based Agile Networks which had struck a tenative deal with the state to lease its communications infrastructure.

The Pence administration in September said it had agreed to lease the state's existing cell towers to Agile for as much as $260 million over the next 50 years, which would help the state fund its bicentennial projects and expand broadband capacity.

Lawmakers are now debating how to pay for those projects, including construction of a bicentennial plaza west of the Statehouse and an education center at the Indiana State Library, which have already been constructed.

After canceling the deal, Holcomb said he has asked the Office of Management and Budget staff "for an assessment of how to move forward and come up with alternatives we want to pursue, including rebidding" the cell tower access. The governor said he would make a decision by the end of the first quarter on how to proceed.

Holcomb said he “lean[s] into rebidding this, but I want to make sure we get a deal, and a deal just never materialized."

Agile Networks was expected to pay Indiana an upfront payment of $50 million and an additional $36 million through revenue sharing over the initial 25-year term of the deal, the state said.

The agreement would have put Agile in charge of managing, operating and marketing the state’s communications infrastructure.

The deal was met with criticism from Indiana Cable Telecommunications Association and the Indiana Broadband and Technology Association. 

The groups wrote in a letter that “it is clear that IFA has focused so intently on the short-term financial rewards of this transaction, that it failed to consider and understand the many consequences that will result from pursuing a policy of this nature. The ramifications will be long lasting and certainly more critical than financing bicentennial projects."

Holcomb stressed that “enhancing broadband availability, especially in rural parts of our state, is still an important part of our consideration.”

And he said his team would also be considering how to pay for the state projects that the deal was supposed to fund.

“The projects that would have benefitted from this revenue source are worthy projects and I’d like to see them come to fruition. How we get there needs to be reviewed,” Holcomb said. 

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