Rutland City is poised to be the fifth municipality to sign on to the Rutland Redevelopment Authority's efforts to provide fiber-optic broadband Internet, telephone and cable service throughout much of the county.

At the recommendation of the aldermen's Intermunicipal Committee, the full board will vote on Monday to sign a letter of intent to participate in Rutland Telecom, which the RRA hopes will be a 14-community partnership mirroring similar municipally owned and operated start-ups in Burlington and between Montpelier and White River Junction.

Castleton, Mendon and Pittsford agreed to sign letters of intent after receiving a presentation from RRA Executive Director Tom Macaulay, while Rutland Town signed the letter without a hearing.

The city's commitment will not burden it with any financial liability. The project will be the work of a limited liability corporation owned entirely by the RRA, which by the language that establishes it in the city charter is itself a separate municipality.

"If we don't do this, the high-tech businesses entering the state will go to Burlington and White River Junction, where this is being done," Macaulay said. "Not doing this would be a real mistake."

Macaulay gave the committee an abridged version of the pitch he made in West Rutland last month before a group of representatives from the 14 communities that have been invited to participate.

Every home and business, without exception, in the communities that agree to participate will be wired for service. When the company becomes profitable, expected in about three to four years after its inception, communities will share in the revenues based on their "take rate," or their number of customers. Communities that host the company's infrastructure will also receive PILOT, or payment in lieu of taxes. Each municipality will also have a representative on the company's advisory board, and down the road there could be municipal ownership opportunities.

The RRA has signed on with consultant Valley Net, which first helped establish Burlington Telecom and is now involved getting EC Fiber off the ground in the eastern part of the state, according to Macaulay. While EC Fiber is applying for stimulus funding, the RRA will seek funding through the 2008 Farm Bill, Macaulay said.

Farm Bill funding will be offered in the form of a no-recourse loan. The rules for the funding have not been finalized yet, but Macaulay said the RRA hopes to have Rutland Telecom's application ready to go for mid-October.

The meeting attracted a city business owner and a resident who both spoke strongly in favor of the project.

Tom Lichtman, owner of VTweb.com, a Web site hosting, design and marketing company with offices in the Opera House building, said he's hopeful the project comes to fruition. His company regularly faces challenges with bandwidth restriction, he said.

"Copper wires are like a two-lane road and this is really like a 16-lane highway right into your living room," he said. Copper wires are the most widely used in Vermont.

The committee also discussed at length the benefit Internet at the speed of fiber-optic broadband would be to marketing the region to businesses. Some areas in the region do not even have high-speed Internet; Macaulay said there's at least one industrial park in the town that has only dial-up access.

"We're in a position down here, I think, where we have to look at any advantage we can take for economic development," said David Allaire, board president. "To turn a blind eye to better and cheaper service, and having some of the revenues stay locally, I think we'd be making a mistake."

stephanie.peters@rutlandherald.com