The controversy also led to the resignation of Odell Horton Jr., former vice president and general counsel of the utility. He was indicted in July along with Edmund Ford, the city councilman whose utility bills ballooned to $16,000. So what else is new in our corruption-riddled town?Īfter all, it wasn't too long ago that former MLGW CEO Joseph Lee was indicted on one count of extortion and two counts of theft or bribery in connection with programs receiving federal money. A controversial, secretive, dump-it-while-we-can failure with a cast of characters who range from angry to dismayed to obstinately silent. But you know what they say about hindsight.Įight years and more than $30 million in wasted ratepayer monies after the fact, Memphis Networx appears to be a wash. Only the government agency probably should have switched the green light to red, or at least yellow. Then, in 2001, The Tennessee Regulatory Authority (TRA), which sets rates and service standards for privately owned utility companies, green-lighted a license for Memphis Networx. The wealthy businessmen and community pillars joined as partners in 2000. Dunavant Jr., recently retired mogul of cotton merchandiser Dunavant Enterprises Inc. The private investors, dubbed Memphis Broadband, included FedEx founder Frederick W. It would provide high-speed data services even to poorer areas its competitors, BellSouth and the former Time Warner Cable, normally wouldn't touch with a 10-foot Ethernet cable.īut the utility's board of commissioners and a group of private investors were to be disappointed, as recent news accounts have reflected only too clearly. The idea was to grab a piece of the 1990s telecom boom by setting up a "backbone" fiber-optics network called Memphis Networx. Memphis Light, Gas & Water Division (MLGW) pledged an initial $20 million to get it off the ground and later upped that amount to $32 million, hopes strained but still stubbornly high. Instead, it ate up millions in credit to remain afloat (although "afloat," in this context, is a relative term). It began in 1999 as a tantalizing possibility that could generate $16 million in revenue a year if investors ponied up enough cash to keep it going until it became profitable.
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