The California Public Utilities Commission (CPUC) has terminated a significant grant awarded to AVX Networks for a crucial fiber-optic network project intended to vastly improve internet connectivity for Catalina Island, LAist reported. The decision, which CPUC staff attributed to alleged breaches of federal spending rules, was communicated to the company via a termination letter sent in July. Lance Ware, CEO of AVX Networks, has consistently denied these allegations and expressed his disappointment regarding the commission's vote and what he described as a lack of public discussion. The project, vital for the island’s more than 4,000 residents and the thousands of tourists it attracts annually, aims to address the slow and unreliable internet connections that currently impede essential services like remote learning and emergency response.
The timeline of the project's difficulties began after the CPUC awarded the grant to AVX Networks in December 2025. Months following the award, CPUC staff accused the company of violating federal spending regulations. These accusations led to the July termination letter. Ware, however, maintains that these allegations are unfounded and has emphasized his commitment to the project, stating to LAist that he is "certainly not the person to quit." He highlighted the "downstream effects of not having reliable connectivity that are unacceptable," underscoring the necessity of improved internet for the island community.
The proposed fiber-optic network is designed to establish a robust undersea connection, laying cables beneath the San Pedro Channel. These cables would run from two distinct points on Catalina Island to landings situated near Huntington Beach on the mainland. From these coastal landings, the network would then connect directly into the Middle Mile Broadband Network located in Stanton, significantly enhancing the island's digital infrastructure. This ambitious plan seeks to transform internet access, which currently affects every facet of island life, from educational opportunities to the swift coordination required during emergencies.
In response to the grant termination, AVX Networks took legal action in July, filing a federal lawsuit against the CPUC. According to court documents, the lawsuit contends that CPUC staff terminated the deal without proper notice and without a formal vote by the full commission. The legal challenge indicates that the project's future, while uncertain, is not yet definitively concluded. A hearing concerning the lawsuit is scheduled for early December, according to Ware. Attorneys representing the CPUC did not provide an immediate response when contacted by LAist for comment regarding the ongoing situation and the pending legal proceedings.
