Apart from the Investigative Audit recently released regarding the ICN, there have been news reports referencing information that is inaccurate. The following information is offered to clarify these issues and we would invite interested individuals to contact us regarding additional information or questions you may have regarding these issues or any other issue. Thank you.
1) Financial Condition –
- The ICN has generated positive net cash from operating activities 7 out of the last 10 fiscal years.
- Two of the three fiscal years not generating positive cash resulted from accounting requirements for a Federal grant that required reporting grant expenses, but not grant funding in operating activities.
- Positive cash flow is reinvested back into the network for equipment upgrades, enhancements, and other required network upkeep. (https://icn.iowa.gov/about/agency-reports)
- Consistent with ICN’s planning, FY17 appropriated funding was reduced by half (approximately $1.1M). No appropriated funding was received for FY18, and no appropriation has been requested for FY19. ICN does not anticipate any funding requests going forward.
- The certificates of participation that were originally issued for the construction of the network were retired in fiscal year 2005. Since that time, the ICN has not incurred any debt for the operation of the network.
2) Use of the ICN –
- No users are mandated or required to use the ICN.
- ICN services may only be provided to state and federal government, public and private K-12 schools, public and private higher education, public libraries, hospitals and physicians clinics, Judicial Branch, public safety, and public defense.
- The Legislature created a class of “certified users” that once certified they were initially required to use the network for all video, data and voice requirements. A waiver process exists if they can acquire services for less cost. Certified users subject to the waiver requirement include Area Education Agencies, Community Colleges and Regents Institutions. To date, no waiver request has been denied. All other users are free to choose other providers without a waiver.
- For the Capitol Complex, administrative rules state that the ICN is the telephone provider to the buildings on the Capitol Complex. As in any other campus environment, this provides efficiencies so as not to have duplication of telephony infrastructure.
- Some agencies have chosen to eliminate landlines and provide cell phones to their employees which are not provided by the ICN.
3) ICN Rates –
- ICN rates for services are competitive with rates charged by other providers for similar services.
- Each year, K-12 schools and public libraries bid their Internet and telecom services in order to receive Universal Service Fund E-rate reimbursements. The ICN responds to these open bids like other providers. The K-12 schools and public libraries are free to choose their providers based on cost and value.
- The ICN has recently begun to provide Managed Voice Services (MVS) to State Executive Branch agencies that are estimated to save State government over $1M per year once MVS is fully implemented.
- ICN fees charged are to be “based on the ongoing expenses of the network and of providing state communications.” (Code section 8D.13 (11) This covers current costs to provide the services and provides for network investments.
4) ICN Technology –
- ICN has 3,300 miles of state owned fiber optic lines with at least one point-of-presence in each of the 99 counties.
- Over the history of the ICN, there have been three network upgrades completed to replace core network equipment that is marked as end-of-life by the manufacturers.
- ICN continues to meet rising user demands for more bandwidth, IP technology, and security. The current upgrade will provide 100 GB capacity on the network backbone, upgradeable to 200 GB. This investment will also reduce the number of devices in the network, reducing on-going maintenance costs.
- As user requirements have changed, so has the ICN. The demand for the legacy distance learning videoconferencing service has declined due to the changing way education uses technology. A plan was implemented several years ago to sunset this legacy platform by June 2018 and replace it with a new IP based videoconferencing service designed to be flexible and allow videoconferencing from any Internet connected device without a dedicated room.
- Advanced cybersecurity services are also available at competitive prices with new offerings in development.