Municipalities that want to roll out Wi-Fi have to deal with costs: Some sage advice appears in this article, including a plaintive cry from Long Beach, which has been raised on a pedestal as an avatar of municipal networking -- you can get some donations and some companies might provide hardware in exchange for the PR value, but, in the end, you have to find the money to run the network. Usual suspect Nigel Ballard suggests that cities and jurisdictions may have to charge for access to make the network a budget reality.
Munis should use 'walled gardens' or 'whitelists' to promote local touristy-type venues but have visitors pay a nominal (but not free) fee to access their e-mail and to surf outside of the local area. Local traffic is free, but e-mail isn't ... a roaming subscription model combined with freenetworks-like local content ... some BBS systems were like that. Remember the BBS community? We're all road warriors, either working or on vacation. List mental health hotlines, museums, whatever, but I'm willing to pay when roaming. Nothing is free for long.
Charging may not be necessary and isn't desirable.
In my city they don't charge directly for street lighting, libraries, drinking fountains or for streets and footpaths.
WiFi may eventually be seen as both a "grace and favour" provision (as suggested by Doc Searls) or a shared utility infrastructure.
The insistence on either making money or recovering costs from users ignores the fact that the percentage of the population accessing or requiring such services, once the preserve of a few, will balloon. Much more so than the proprietary closed stove-piped monopoly 3G service providers.
Spending a lot now to establish billing systems may prove to be wasted in a relatively short time.
The notion of a closed garden is good, but I suspect the garden should be free and perhaps travelling out of town should cost...
Where volunteers are able to establish such services, it can't be beyond the financial reach of a municipality to provide them gratis, at a certain QoS, and leave the commercial sector to make a decision about what the traffic will bear for a more "carrier grade" service.