agency backs Terremark position versus FPL in NAP controversy
The Community Redevelopment Agency will throw financial support behind developers of the Network Access Point, a massive Internet-connection site being built in downtown Miami, to help the telecommunications consortium meet revenue requirements from FPL, agency officials said.
The utility is demanding security from the developer Terremark Worldwide to guarantee revenue from the large amount of power the network is projected to use. The Community Redevelopment Agency, with city commissioners sitting on the board of directors but acting independently from the City of Miami, decided to support Terremark if bonds are needed.
FPL is requesting the developer to provide a $2.2 million bond, down from an original $7.5 million, which the Florida Public Service Commission OK'd early this year, said William Bloom, an attorney with Holland & Knight, on behalf of the developer.
FPL demanded the bond after officials said they would have to expand their plant's capacities to provide the requested 100 watts per square foot for service needed to keep the NAP running, according to an April 18 letter from Mr. Bloom to to Commissioner Arthur Teele.
Terremark is developing the NAP, the fifth tier-1, network access point in the US in the Technology Center of the Americas in Park West. It is scheduled to begin operation June 30.
While FPL and the developer are still negotiating the bond's amount, Mr. Bloom said this week "things were going in the right direction."
Under the tentative settlement, FPL would demand a lower bond than originally sought but provide the NAP with less power. At the time the developer needs more energy, a new bond would have to be posted for the additional power.
"The CRA would assume the responsibility to reimburse the cost of any bond," said Mr. Teele at a Community Redevelopment Agency meeting. "It will send the message we are committed to the development of the NAP and the entire neighborhood."
Brian Goodkind, executive vice president and COO with Terremark, thanked the board. He said it was the best way out considering Terremark "would not have enough time to petition the PSC ruling."
Alex Vilarello, city attorney, said commissioners instructed him to look to outside counsels to revise the PSC's approval and "go back before the PSC to make some changes" to the original ruling "to allow the NAP to go forward without some of the additional restraints."
The guaranty agreement, among other things, would require the developer to assure FPL that the requested energy demand would materialize by the end of three years, according to the letter. It obligates the developer to reimburse FPL for a portion of the costs incurred for the infrastructure needed to service the network if that demand does not materialize during that time.