New Orleans Mayor LaToya Cantrell’s administration released new details about its contentious “smart cities” project on Monday, shortly after City Council President Helena Moreno sent a subpoena to a top administration official demanding he turn over a wide range of relevant documents and appear at an April 27 council meeting to answer questions under oath.
The information appears in a four-page letter from Director of the Mayor’s Office of Utilities Jonathan Rhodes, who was the subject of the subpoena. While it does not appear to provide the level of detail the council was seeking, it lays out the four broad goals of an initial one-year agreement the administration plans to sign with Smart+Connected NOLA, the prospective contractor:
- Installing new WiFi equipment at 10 recreation centers, at a cost of $3 million in upfront investment and $300,000/year for ongoing maintenance
- Free demonstrations of “smart cities” devices and their benefits
- Beginning the process of facilitating free or low-cost internet service for certain “target neighborhoods” through an existing federal subsidy program
- Planning out a fiber network for city government
Moreno issued the subpoena because she and other council members have struggled to get the Cantrell administration to share basic information about the sprawling, multi-million dollar public-private partnership to create new city-directed and city-owned internet offerings and install thousands of “smart cities” devices throughout the city.
Along with any city communications or draft agreements with Smart+Connected NOLA or its member firms, the subpoena also seeks copies of city communications with George Burciaga and Reyahd Kazmi of Chicago consulting group, Ignite Cities, and communications with Kazmi’s wife, Chicago City Clerk Anna Valencia.
Ignite Cities is not officially part of Smart+Connected NOLA — a consortium of companies led by wireless giant Qualcomm and JLC Infrastructure, an investment firm co-founded by NBA superstar Earvin “Magic” Johnson — which was selected as the winning bidder for the city contract over four other firms last year. But the consultancy firm was at the center of contract-rigging allegations from rival bidder Cox Communications.
The allegations concerned Ignite Cities’ involvement in helping the city draft the public bid solicitation for the “smart cities” project last year, a potential conflict because the firm had previously announced it was partnered with JLC and Qualcomm. Those allegations were dismissed by the city, which said that Ignite Cities had no financial interest in the deal. Cox said it would not appeal that decision, according to Rhodes’ letter.
But recent reporting from Illinois revealed that Kazmi, managing director for the consulting firm, is also a registered lobbyist for another company that stands to gain from the contract, IKE Smart City, which makes “smart kiosks” and is identified in the Smart+Connected bid as a partner in the project. The report, by WCIA-TV, also revealed that Valencia was in communication with city of New Orleans officials and Ignite Cities about projects the consulting firm was working on.
Ignite Cities’ involvement “raises the question as to whether the city partnered with a consulting group to rig the contract to go to certain investors,” Moreno said in an interview this week.
Despite concerns about the public bid process, and the scant information the administration has provided about its plans, Cantrell had been leaning on the council to support the project and the multiyear contract she wanted to sign. All multiyear agreements require City Council approval.
But Monday, amid growing skepticism on the council, the administration told The Lens that the city was jumpstarting the project with a one-year agreement, which does not require council approval, as the city continues to negotiate a long-term deal and garner support from the public and council.
Moreno has called the one-year agreement an attempt to “circumvent” the council’s authority, although Cantrell’s office denied that was the intention. Rhodes said in his letter that the one-year agreement will give the administration time to work with the council to build consensus on a long-term agreement.
“This year of planning will include regular meetings with stakeholders, public testing and demonstration of technology, and planning with City Council toward a multiyear CEA,” the letter said.
The new information provided by Rhodes on Monday night laid out what that first-year program will look like, and provides the most significant update to the project since the city selected the Smart+Connected NOLA proposal more than a year ago. Still, Moreno said that even with the new information, there were still several unanswered questions, and that her subpoena was still active.
She also said that an initial review of the new information left her and her staff “disappointed,” especially when it came to the city’s plan to provide low-cost, in-home WiFi, which Moreno said was simply repackaging an existing federal program.
First year projects: NORD WiFi and Smart Cities demonstrations
The four-page letter lays out the four central goals of the one-year agreement. The first two involve demonstrating the potential of the technology offered by Smart+Connected NOLA, a way to test and prove it can work. The third and fourth goals involve planning and preliminary steps for projects that would only come to fruition after the one-year agreement ends, by which time the Cantrell administration hopes to have a multiyear agreement in place.
First, the plan involves installing new WiFi infrastructure at three NORD recreation centers in the first three months, and 10 total in the first year. The city will use $3 million from general obligation bond funds to build out the new WiFi. And it will cost an estimated $300,000 a year to maintain after that for the 10 sites.
“A long-term CEA will determine a source of revenue to pay for ongoing costs to maintain public WiFi at these facilities,” Rhodes’ letter said.
This part of the project, like many aspects of the broader “smart cities” plan, is being pitched as a way to expand internet access to those who can’t afford it. The city has already announced the first three recreation centers where the new WiFi will be installed — at Joe W. Brown Recreation Center, Milne Recreation Center and Treme Recreation Center — but all three of them already have WiFi available to visitors, employees told The Lens.
At a cost of roughly $30,000 a year per location, the new service appears to be relatively expensive. Moreno said that Rhodes’ letter didn’t have enough information to know whether that cost is reasonable.
“I have no idea what that all means or what’s the appropriate cost because these brief bullet points are the most details I’ve seen since I started asking questions months ago,” Moreno said.
It’s also unclear what would happen to that $3 million upfront investment if a multiyear agreement is never signed.
The second aspect of the initial, one-year agreement is demonstrating the capabilities of “smart cities” devices, including streetlights, traffic signals, and “public information kiosks.”
“Smart City Applications will be demonstrated by partners at no cost to the city,” the letter said. “Going forward, a long-term CEA should identify any potential ongoing costs to the city and sources of funding and/or revenue to cover those costs.”
These devices are central to the project. One main purpose of the project from the beginning has been to create a private internet network for the city that would both replace existing commercial internet subscriptions the city has. That new internet service is supposed to have broad enough coverage to allow the connection to “smart cities” devices scattered throughout the city.
“Smart cities” devices can serve a broad range of purposes, but generally they seek to take traditional city-owned infrastructure and replace or augment it with devices that are loaded with cameras and sensors and that can transmit data over the internet.
Cameras and other sensors in “smart streetlights,” for example, can collect traffic data that can help better manage city traffic and be sold off in the private sector to ride share apps or insurance companies. “Smart streetlights” can inform the city as soon as a light has gone out, or be equipped with sensors that warn the city about flooded streets.
All of the technology, however, requires a big increase in municipal data collection, which has caused concerns for Moreno and local privacy advocates with the Eye on Surveillance Coalition, a group that has also been critical of Cantrell’s expansion of crime cameras and other police surveillance technology.
“While ‘Smart Cities’ run on data and information, there has understandably been concern about privacy and specifically the potential for Personal Identifiable Information (PII) to be collected,” Rhodes’ letter said. “Therefore, it is important to note that no PII will be collected during or as a result of this project. … The CEA will explicitly prohibit the collection of PII.”
Future planning for subsidized WiFi and fiber network
As for the third and fourth elements of the plan spelled out in Rhodes’ letter, it’s unclear how much will actually be achieved during the one-year agreement, since both have timelines that exceed 12 months.
The third piece of the project is getting free and affordable internet into the homes of households that can’t currently afford a subscription. The city has said getting more home internet subscriptions is the central obstacle to shrinking the city’s digital divide. The city has claimed the smart cities project will help do that, although it’s always been unclear how.
According to the Monday letter, the plan will involve seeking “partners to provide affordable, high speed in-home internet plans capped at $30/month to help bridge the digital divide in target neighborhoods.”
The plan notes that eligible residents will be able to get those subscriptions for free if they are approved for a new federal program called the Affordable Connectivity Program. The program provides $30 per month subsidies for internet subscriptions, as well as other benefits, to any household making at or below 200 percent of the federal poverty line. That’s roughly $55,500 a year for a four-person household. Households can also get the subsidies if any member of that household is eligible for several federal programs, including Medicaid and SNAP.
Moreno pointed out that those proposed internet costs aren’t actually cheaper than existing options. Cox Communications already offers a $30 per month “basic” plan, as well as a $20 per month “budget” plan, for New Orleans customers. Residents can also apply for the Affordable Connectivity Program through Cox, meaning there is already a free WiFi subscription option for eligible households.
“I’m kind of shocked that the WiFi piece is $30 a month for low income families,” Moreno said. “That’s the same thing that Cox and AT&T provide. What is happening here.”
She said that the city appeared to simply be repackaging the federal program, which was signed into law last year as part of the $1 trillion infrastructure bill championed by President Joe Biden and Vice President Kamala Harris.
“How is this the city’s ‘WiFi for All’ plan? It’s the Biden-Harris plan!” Moreno said.
The timeline for this portion of the project is 12-24 months — longer than a one-year agreement.
The letter says the “free and affordable internet service will be provided by third-party companies” but does not identify them. The Lens asked Cantrell’s office whether the “partners” providing these $30/month plans would initially just be existing internet providers.
“Not necessarily Cox or AT&T,” Cantrell spokesman Beau Tidwell said in an email. “S+C NOLA would be the 3rd-party provider, but they may lease some parts of their service from a local provider.”
The original proposal from Smart+Connected NOLA contemplated building an entirely new broadband subscription service to compete with existing providers like Cox and AT&T. But that will require millions in upfront investment, and it’s unclear if those investments will begin under the one-year agreement.
Tidwell didn’t respond to follow up questions.
The fourth and final portion of the plan detailed in Monday’s letter is building out “institutional fiber” for the city. Smart+Connected NOLA’s original proposal calls for using existing commercial and city-owned fiber when possible to meet the city’s connectivity goals, and only installing additional fiber when necessary.
According to the letter, the city wants to “develop a design” for 100 miles of institutional fiber. An institutional fiber network for the city to use for city-owned facilities and infrastructure would cost $30 million to deploy, according to a study cited in the letter. But, Smart+Connected NOLA’s bid promises to do it at no upfront cost to the city. Instead the city would pay for it over time.
“Currently, the City leases fiber for Cox and/or AT&T,” the letter said. “The long-term CEA should develop a strategy to begin deploying institutional fiber as quickly as possible, with a plan for the city to take ownership of fiber either through infrastructure funding or by financing and amortizing the cost over time.”
The city has also alluded to using that “institutional fiber” as a revenue generator.
“There are opportunities for the city to generate revenue by monetizing fiber such as leasing to third parties,” the letter said.