Qwest Communications and Centerville appear to be on a collision course over a proposal by the city's redevelopment agency that it spend approximately $88,500 to help speed up deployment of the Utopia fiber-optic system in the Davis County community.

Centerville was one of 10 Utopia member cities that voted earlier this year to significantly increase its residents' financial commitment to the troubled fiber optic system only to find itself pushed far down on the network's construction priority list.

In an effort to speed up the build out of the system, the city's Redevelopment Agency recently proposed loaning Utopia the money to lay fiber-optic lines in the business district just off the Centerville exit on 1-15. Another possibility is for the agency to oversee laying the fiber itself and then lease the lines to Utopia, said Blaine Lutz, Centerville's finance manager.

"We're eager to see the Utopia system deployed throughout the city and we'd like them to get started," Lutz said. "But right now, we're just seeking good legal advise on whether the RDA can get involved or not."

Qwest doesn't think it's legal for the Centerville RDA to get involved.

In a letter to Centerville Mayor and RDA Chairman Ronald Russell, the giant telecommunications company argues that the proposal, if carried out, would give Utopia an "undue and unreasonable advantage in the marketplace" and violate state and federal laws.

"It appears that this proposed transaction using RDA funds would be tantamount to the city selecting one company over others for preferential treatment and would not be competitively neutral," Qwest said in the letter written by attorney Gregory B. Monson of the Salt Lake City law firm of Stoel Rives.

Short for the Utah Telecommunication Open Infrastructure Agency, Utopia was organized in 2002 amid a sense of frustration by the leaders of its founding cities that the state's largest telecommunications providers weren't moving fast enough to bring high-speed broadband services to their residents.

Those cities -- Centerville, Brigham City, Layton, Lindon, Midvale, Murray, Orem, Payson, Perry, Tremonton and West Valley City -- decided to build a wholesale network that would lease capacity to any service provider who wanted to use the system's fiber-optic lines to serve customers. They pledged $202 million in taxpayer money to back the bonds needed to fund the development of the system.

Yet four years after construction began, low customer counts and financial missteps had drained Utopia's bank accounts to where it was teetering on insolvency. Utopia was forced to return to its member cities to warn them that if they didn't approve a massive refinancing and commit hundreds of millions more to the system they soon be called upon to start funneling their pledge money to Utopia to pay off its bonds, even as the network shut down.

Ten of Utopia's member cities supported the refinancing, even though it only gave Utopia an additional $11 million in funds to continue to build out the network. Only Payson balked.

Utopia spokesman Hugh Matheson said the network's developers would like nothing more than to build out in Centerville but Utopia just doesn't have the money to do it. He said Utopia is looking for the best spots in all of its member cities where the network can be quickly deployed so it can begin generating revenue.

"We're more than willing, though, to have them help fund construction," Matheson said, contending other member cities along with Centerville also are pondering ways to help further fund Utopia's build out.

The Centerville City Council is expected to take up the matter as early as next month.