9-9-18 UPDATE – HOW LANCASTER SPENT OVER $5 MILLION AND GOT…
“IT’S NOT RISKY!“
The loan terms will allow the city to take over the fiber network outright should MAW default, Hopkins [Patrick Hopkins, Director of Administrative Services] said. It could then hire another firm to manage it.
Lancaster also would have liens on MAW’s other assets and LanCity Connect revenues and potentially could recover other MAW revenues in the event the company folded while still owing the city money.
From the LNP article, “Official: It’s not risky for city to put up money for LanCity Connect broadband, and here’s why,” (click here).
Let’s examine this in detail:
— There is no “fiber network” to “take over” and the little that was installed is being taken down under court order.
— How much revenue is LanCity Connect bringing in that the city can put a lien against? The last we heard they had about 100 business and personal customers (and some of those are being disconnected by PP&L). If they purchased the highest tier – “$124.64 a month after fees,” rounding to $125 that’s $12,500 a month and $150,000 a year. Of course they still have to pay a customer service person and an accounting person and apparently still pay Favyan Asia who states he is the “lead network engineer” at MAW Communications. That’s not going to recover the $1.5 million dollar loan!
— What are MAW’s other assets the city can take? We know they own a building in Reading assessed at $89,000. We don’t know what other assets they have but I will put in a Right to Know request for the list because certainly the city would not have loaned them $1.5 million without a list of assets!
— What other revenue does MAW have coming in that the city can take to pay back the $1.5 million dollar loan? We don’t know (it has been suggested that Lancaster is their only “customer”) but I will put in a Right to Know request for their revenue sources and amounts since certainly the city would not have loaned them $1.5 million dollars without having reviewed many years of their financial statements and knowing their actual revenue stream down to the penny!
ABSOLUTELY NOTHING! – 2
The below is an excellent, well-researched review of MAW Communications and LanCity Connect’s history by city resident Billy Weisser. He posted this on the “Northeast Neighbors United” Facebook page. Everyone should read it! Everyone.
LNP’s complete silence on this over $5 million waste of taxpayer’s dollars is appalling, shameful and inexcusable.