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Monday, January 28, 2013 8:34 PM

City wants Allegiance deal details

By DOUG CARDER, Herald Senior Writer

Ottawa city commissioners said Monday they would not approve the transfer of a franchise agreement for broadband telecommunications services until they receive answers about what the new provider’s plans are for Ottawa.

BCI Broadband, Purchase, N.Y., recently announced it would acquire Allegiance Communications, which provides Internet, cable TV and digital telephone services to Ottawa customers. The transaction is expected to close in early 2013, representatives from both companies said.

Bob Bezek, Ottawa city attorney, told city commissioners Monday that in reviewing the documents the companies provided to him regarding the franchise agreement, “there was absolutely nothing in the documents — not one sentence worth — about how they [BCI Broadband] would improve the situation we have today.”

The City of Ottawa’s current franchise agreement with Allegiance runs through April 2015, Bezek said Monday. The city commission would have to adopt a resolution granting the transfer of the franchise agreement to BCI Broadband.

Richard Nienstedt, city manager, told city commissioners his understanding was that BCI Broadband planned to sell off some of the smaller Kansas markets served by Shawnee, Okla.-based Allegiance to other providers. But Nienstedt said his impression was that Ottawa was not considered to be among those smaller markets.

Nienstedt said a BCI Broadband representative would be invited to attend next Monday’s study session at 4 p.m. at City Hall, 101 S. Hickory St., Ottawa.

“You are under no obligation to approve this [franchise agreement] transfer at your next meeting [Feb. 6],” Bezek said. “We have until May 18 before you need to take action.”

Mayor Blake Jorgensen and city commissioners said the city would prefer to have more information about what BCI Broadband’s plans are for the Ottawa market before they consider voting on a resolution to transfer the agreement.

Shawn Beqaj, BCI’s vice president of public and government affairs, said he could not comment about the Allegiance acquisition until the transaction is closed. He said the company is working as quickly as possible to close the deal.

The acquisition also would require approval of the Federal Communication Commission, which typically takes 60 days to 90 days to complete, based on previous transactions in the telecommunications industry.

Upon completion of the Allegiance transaction and subsequent capital investment, BCI executives said in a news release the company would deploy advanced broadband networks to more than 150,000 homes and businesses in the Allegiance footprint with “high-quality services, including modern, high-speed Internet, high definition video and voice services, across an upgraded fiber network.”

Allegiance operates non-urban broadband systems across Kansas, Arkansas, Texas and Oklahoma.

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