THE CITY IS STRUGGLING with a new reality - a dramatic downturn in revenues, and big budget holes necessitating cuts. The latest round, just announced by the mayor, is a 2 percent cut in all departments.

What makes this new reality surreal is that at the same time the city fights to stabilize its budget, it can't stop looking forward and making long- and short-term investments.

The city's plan to spend $2 million to buy the remains of a citywide wi-fi network may be one of those necessary investments. We not so sure, yet.

For one thing, this is the third version of the wi-fi project since it was conceived in 2005. Originally, the network was supposed to be privately funded and provide low-cost service to the entire city. That dream died when Earthlink, the company building the network, ran into financial problems and pulled out of the project.

Earthlink then sold the infastructure in 2008 to a local group of investors, who tried to revamp the business model. However, that plan also failed, which is why the city wants to buy the network.

City officials say purchasing the network, which still requires approval from City Council, will allow municipal workers to do their jobs more efficiently. For example, L&I inspectors could file inspection reports in real time, eliminating paperwork.

They also say that the network is worth at least $30 million, making it a steal at $2 million.

We're not ready to say Council should kill the deal, but the proposal should face tough scrutiny. (First reading is today; the bill could be passed as soon as June 10.) Some questions:

* How real is the $2 million price tag? In addition to the cost to acquire the network, how much will it cost to equip city workers with phones and mobile devices that could use the network? Also, will the city have to spend any money to upgrade the reach of the network, since it only covers about 75 percent of the city?

* Does the city have a backup plan? Over and over, the citywide wi-fi network has failed to live up to expectations. If the worst happens and something prevents the network from being used as planned, what will we do with the assets? Can the city sell the network to a wireless provider?

* How does this latest change in strategy help close the digital divide?

Spending $2 million on a system that has failed to work as promised so many times in the past shouldn't be a slam dunk. *