By Lewis Loflin
In 2010, Bristol Virginia Utilities (BVU) transitioned from a city-managed entity to an independent authority, a move approved by the Bristol City Council and the Virginia General Assembly. The decision faced public opposition and legal challenges but was ultimately implemented. By 2019, BVU OptiNet, its telecommunications division, was sold to Point Broadband, following legal and financial difficulties, including the conviction of several BVU executives. This historical analysis examines BVU’s transition, its objectives, and its economic impact on Southwest Virginia (SWVA) as of 2025.
In October 2009, the Bristol City Council voted 3-2 to approve a plan for BVU to become an independent authority, a decision that required Virginia General Assembly approval. BVU CEO Wes Rosenbalm expressed support for the vote, noting the potential for future collaboration with dissenting council members Jim Heaney and Guy Odum. The BVU board had unanimously approved the plan on October 5, 2009, after months of discussion. The new authority board would consist of nine members: five selected by the City Council, three by the authority board, and one from the Washington County Board of Supervisors. BVU remained subject to the Freedom of Information Act as a public entity. [Ref BHC, October 28, 2009]
Proponents highlighted financial benefits, including refinancing BVU’s $49 million revenue bond debt to save approximately $500,000 annually in interest, a move the city could not undertake due to federal guidelines. However, Heaney raised concerns about the authority’s governance, specifically the ability of a three-vote majority in a five-person quorum to petition the General Assembly for future legislative changes, potentially reducing city oversight. [Ref BHC, October 28, 2009]
The transition faced opposition from residents and a lawsuit by the Whitley family, who argued that the council’s 3-2 vote constituted a sale of city assets, requiring a four-vote super-majority. On January 14, 2010, a judge rejected the city’s motion to dismiss the lawsuit, allowing it to proceed. The city, represented by former Virginia Attorney General Anthony Troy, argued that the votes were a request to create the authority, not an asset sale, and that the court could not rule on speculative General Assembly actions. Legislation to create the authority was introduced in the Virginia Senate and House, aiming for a July 1, 2010, establishment. [Ref BHC, January 14, 2010]
Public opposition was voiced at a February 2010 hearing, where residents, including Councilman Guy Odum, former council members Ron Morgan and R.L. Light, and activist Nancy Marney, expressed concerns. Critics argued that BVU, which had received $10–20 million in public grants, was functioning well under city oversight and questioned the need for independence. Some feared the authority might prioritize regional expansion over local interests or increase rates for residents. The legislation was supported by State Senator Bill Wampler and Delegate Terry Kilgore, who had previously facilitated state and Tobacco Commission funding for BVU. [Ref BHC, February 23, 2010]
By mid-2010, court challenges were dismissed, and BVU became an independent authority. However, the transition faced significant challenges. Between 2016 and 2017, several BVU executives, including CEO Wes Rosenbalm, were convicted on federal charges of bribery, fraud, and conspiracy related to OptiNet contracts, with Rosenbalm sentenced to 33 months in prison. In 2019, BVU OptiNet was sold to Point Broadband, a private company, following financial difficulties that required the repayment of some public funds. The sale marked the end of BVU’s direct involvement in telecommunications. [Ref web ID: 0, WJHL 2019]
The stated goal of BVU’s broadband expansion was to attract private-sector jobs to SWVA. However, regional economic data indicates limited success, as the information sector declined by 45% from 2010 to 2020, compared to a 2% national increase. Some call centers relocated to SWVA to access incentives, including one that moved from Kentucky, but these jobs were often temporary, aligning with broader trends of call center instability in the region. [Ref prior analyses]
By 2025, SWVA continues to face economic challenges. The Tri-Cities area has lost over 60,000 jobs since 2009. Median wages in the Bristol Metropolitan Statistical Area (MSA) have risen from $15.27 in 2016 to approximately $17.33 in 2025, and in the Johnson City MSA from $14.47 to $16.15, adjusted for 3% annual inflation. Per capita income in Bristol, VA, has increased from $21,589 in 2018 to approximately $27,000 in 2025, also adjusted for inflation. However, these figures remain below national averages and living wage standards for many residents. Population declines of 3–5% in counties like Washington since 2010 and an annual outmigration of 8,000–10,000 college graduates further highlight the region’s challenges. [Ref prior analyses]
A 2005 LENOWISCO study provides context for economic development in SWVA: “The region has been replacing traditional manufacturing jobs with call center jobs, which provide limited advancement and work opportunities...easily moved to other regions and/or countries.” It also noted offshoring risks (Asia’s $1–$5/hour wages), low-skill reliance (~30% no high school diploma, 2003), and firms leveraging subsidies, such as VCEDA’s $5.6 million for Sykes. Non-unionized sites lost ~2 million U.S. jobs by 2015, unlike AT&T’s protected workforce. Educational challenges—~50% lacking a high school diploma in Dickenson County (2008)—further limited the region’s ability to sustain employment. LENOWISCO Study, sullivan-county.com
| Sector | SWVA (% Decline) | USA (% Change) |
|---|---|---|
| Arts, Ent., & Rec. | -20% | 6% |
| Wholesale | -25% | 3% |
| Construction | -35% | 24% |
| Information | -45% | 2% |
| Mining | -50% | -11% |
Notes: Excluding mining, SWVA experienced declines in sectors that grew nationally. The region’s mining sector decline exceeded the national average. A total of 10,451 jobs were eliminated across these five sectors, with 16,774 jobs lost when including national mining sector declines between 2010-2020. The 45% decline in the information sector persists despite an estimated $200 million in public investment, likely exceeding $300–$400 million, with significant data withheld.
Ref: Zach Jackson, Virginia Tech
Bristol Virginia Utilities’ transition to an independent authority in 2010 aimed to enhance operational flexibility and expand its OptiNet division, supported by $10–20 million in public grants. Despite initial financial benefits, such as $500,000 in annual interest savings, the initiative faced opposition, legal challenges, and later financial difficulties, culminating in the 2019 sale of OptiNet to Point Broadband. The convictions of BVU executives further complicated the transition. As of 2025, SWVA continues to face economic challenges, with limited private-sector job growth despite broadband investments, highlighting the complexities of such initiatives in addressing regional poverty and unemployment. Compiled April 16, 2025.
Acknowledgment: I’d like to thank Grok, an AI by xAI, for assisting in drafting and refining this article. The final perspective and edits are my own.
