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HomeMy WebLinkAbout02 MEDIA ONE RENEWAL 05-01-00 NO. 2 : " 05-01-00 ~i i i~~~--------~-'iii- I nter; )m DATE: May 1, 2000 ~ TO: FROM: SUBJECT: WILLIAM A. HUSTON, CiTY MANAGER PUBLIC WORKS DEPARTMENT PUBLIC HEARING TO CONSIDER THE RENEWAL OF A CABLE TELEVISION FRANCHISE AGREEMENT WITH MEDIA ONE GROUP, INC. SUMMARY in accordance with the procedures established by the adoption of City Council Resolution No. 99-49, the City Council will conduct a public hearing to consider the renewal of the CATV franchise for Media One Group, Inc. The purpose of the hearing is to identify the' City's future cable-related needs and to review the performance of the franchisee during the current franchise agreement. RECOMMENDATION Staff recommends that upon conclusion of the public hearing, the City Council authorize staff to prepare' and send a letter requesting a franchise agreement renewal proposal from Media One Group, Inc., that responds to the issues identified by the City Council, citizens and Staff. FISCAL IMPACT Media One subscribers pay a 5% franchise fee, which amounts to approximately $188,000 in annual revenue to the City. There is no fiscal impact associated with this action. BACKGROUND Media One Group, Inc ("Media One") possesses a non-exclusive' cable television franchise covering the entire City that expires July 6, 2002. Federal Communications Act of 1934 (the "Act") as amended by the Telecommunications Act of 1996 requires the City to hold formal renewal prOceedings if a franchisee requests it within specified times.. The Act further authorizes the City to commence informal proceedings for renewal should the cable operator fail to request the formal proceedings outlined in the Act. On June 21, 1999, the City Council adopted Resolution No. 99-49 setting the specific procedures to use while processing the Cox Communications cable television franchise renewal. The resolution also stated that the City desired to establish a uniform procedure for consideration of cable television franchise renewals. Therefore, staff is utilizing the same process for the Media One franchise renewal as. was and is being utilized for the Cox Communications cable television franchise renewal. The resolution s attached to this report as Attachment A. The first step in the process is to conduct a public hearing to review past performance and to identify future community needs prior to soliciting a formal proposal from the current franchisee. Media One and Cox are the only cable television service providers in the City. Both franchises are non-exclusive agreements whereby the City has granted each provider the right to use the public right-of-way to provide cable television services. Media One's service area encompasses the area of the City that is generally west of Browning Avenue. The current franchise agreement with Media One began April 8, 1988 with a term of approximately 15 years to terminate on July 6, 2002. The original agreement was granted to Continental Cablevision, Inc., and was later assigned to Media One in April 1998. Staff offers the following general observations regarding past franchise performance by Media One: GENERAL CUSTOMER SERVICE Staff receives an unusually large volume of calls regarding customer service issues such as billing, service interruptions or equipment maintenance. Over the last two years, Staff has received an approximate average of five calls per day. Common customer complaints include: 1. Frequent and prolonged television service interruptions. 2. Rudeness and indifference is displayed by Media One customer service representatives. 3. Customer service staff is not knowledgeable about products and procedures. 4. Telephone service calls are not answered or are answered by a recording only. 5. Long hold times. 6. Failure to respond to scheduled on-site technical service calls. 7. Various customer billing issues (i.e.; high rates, Iow service levels, billing errors). The calls that staff received are heavily weighted towards issues one through five. Media One has, in the past year, centralized its customer services operations and has reduced the unanswered call and hold time complaints but still has not resolved many other common complaints. Media One generally attributes these problems to a poorly executed shift of local telephone customer services representatives to their main office in El Segundo. Staff believes that Media One has now increased staffing, but has not properly trained that staff to handle customer calls efficiently and courteously. In addition, Media One recently instituted a management reorganization that has diminished staff's ability to facilitate the resolution of customer complaints. Staff was not informed of these changes until well after they occurred and received only a verbal notification several weeks thereafter. SERVICE OFFERING/PROGRAMMING Media One's 'system is currently capable of offering a maximum of approximately 55 channels. In contrast, the Cox system offers over 100 channels, digital services, telephony, and broadband Internet service. Media One's channel capacity and limited programming is restricted due to the technical limits of the current systems that Media One utilizes. Listed below is a summary of the customer complaints: 1..Limited channel/programming offerings. 2. Frequent service outages (often widespread) 3. Broadband Internet service is not available. Media One is currently in the process of completing a major plant upgrade to provide over one hundred channels of analog and digital cable television service, broadband Internet service and telephony services. While this rebuild has been underway for close to a year, neither staff nor the public has received any firm commitment for a completion date of this rebuild. It is notable that the Tustin system (City and unincorporated) is the last system to be rebuilt in the greater Los Angeles market area. The rebuild also raised a policy issue related to the use of City right-of-way and the resulting aesthetic effect of a proliferation of above ground utility appliances. This issue was resolved last fall when the City Council adopted the above-ground cabinet ordinance. In addition, Media One has recently hired a new engineering firm and construction contractor in an attempt to move the rebuild forward. Staff is generally pleased with this recent effort and looks forward to the completion of the project. Based on the preceding review of past performance; staff recommends that the Council require Media One to submit a franchise renewal proposal addressing the following issues: I . Provide live coverage of City Council meetings and a regularly scheduled rebroadcast at least 2 times, including 1 broadcast during a weekday prime time and 1 broadcast during the weekend, including transmission to the Cox Communications system. 2. Provide a full time local access channel dedicated to the City of Tustin with coordinated or joint programming provided by Media One and Cox. 3. Provide assurances in the agreement for payment of franchise fees for data/internet services. 4. Explicitly agree to utilize current Federal CommunicatiOns Commission requirements for customer service. o Provide documentation, satisfactory to the City, of company customer service quality assurance efforts and of participation by all customer services staff in training in customer relations. 6. Subject the agreement to future City ordinances and City Code amendments. 7. Provide free Internet access to City facilities, libraries, and schools in the Media One service area. 8. Agree to provide open Internet access in Tustin should it become available to any municipality in the State of California. 9. Continue to maintain a local customer service office. 10. Maintain a locally accessible television program production facility. 11. By June 30, 2003, upgrade City Council television production facilities, as mutually agreed, for a minimum cost of $10,000 and a maximum cost not to exceed $25,000 for equipment and installation services. 12. Continue to provide qualified staff to provide production services for City Council meetings. While these requirements are not identical to the requirements that were identified for Cox Communications, they do recognize the history of past services provided by Media One and other issues unique to Media One. Resolution No. 99-49 requires that the proposal be submitted within 90 days. As with Cox Communications, staff proposes that the City Council set the Media One proposal due date at 120 days from the date of this public hearing. ~'Tim ~Serlet(~~~- Director of Public Works/City Engineer Attachment: A: City Council Resolution 99-49 Public Works Department 10632Fd 1 2 3 4 5 6 7 8 9 I0 11 12 13 14 15 16 17 18 19 2O 21 22 23 24 25 26 27 28 RESOLUTION NO. 99-49 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TUSTIN, CALIFORNIA ESTABLISHING A PROCESS FOP, CONSIDERATION OF CATV FRANCHISE RENEWAL. WHEREAS, the Communications Act of 1934 as last amended by the Telecommunications Act of 1996 provides for the renewal of existing CATV franchises and authorizgs the City to require a renewal proposal and to set deadlines therefor; and WHEREAS, Cox Communications ("Cox") has requested that the City initiate renewal of its CATV franchise; and WHEREAS, the City Council wishes to establish a uniform process for consideration cf CATV franchise renewal according to law. NOW, THEREFORE, THE CITY COUNCIL OF THE CiTY OF TUSTIN, CALIFORNIA, finds, determines and orders as follows: SECTION 1' .(A) The City Clerk is hereby directed to publish notice of a public hearing at a r-;~ular meeting of the City Council in the next 60 days on the question of the renewal of Cox's CATV franchise. The Director of Public Works shall select the date of the meeting for the hearing and shall provide it to the City Clerk within 2 weeks of June 21, 1999. The Director of Public Works shall notify Cox in writing of the meeting date selected. (B) Upon receipt of a request by a Cable Operator for a CATV franchise renewal within the six (6) month period commencing with the 36th month before the franchise expires or upon determination of the Public Works Director, or the Director's designee, that renewal procedures under this Resolution are warranted, the Public Works Director, or the Director's designee, shall request the City Clerk to publish notice of a public hearing before the City Council to consider renewal of the CATV franchise. (C) The City Clerk's notice shall state that the purpose of the hearing will be to: (1) Identify the future cable-related community needs and interests', and (2) Review the performance of the cable operator under the franchise during the current franchise term. The Director of Public Works shall notify the cable operator of the public headng time and date. !!! ill 10S328\1 10832Z',I 1 2 3 4 5 6 7 8 9 10 ;il 12 13 14 15 16 17 18 19 2O 21 22 23 24 25 26 27 28 SECTION 2: Within fi~een (15) days of completion of the public hearing process required Section 1 above, the Public Works Director shall notify the cable operator of the completion of the hearing held under Section 1 above, and shall direct the cable operator to submit a franchise renewal proposal, which shall contain the material required by Chapter 4 of the Tustin City Code, the cable operator's proposal for operating the cable system, providing the required facilities and equipment, upgrading the system, and other issues raised at the public hearing held under Section 1 above. The notice shall further provide that the cable operator's proposal is due ninety (90) days from the date of the notice required by this Section. SECTION 3: Within ninety (90) days of receiving the cable operator's proposal pursuant to Section 2 above, the Public Works Director, or the Director's designee, shall report and'recommend to the City Council whether to approve or deny the renewal of the franchise. The City Council shall approve a renewal by ordinance. If the City Council finds it in the best interest for the City to deny the renewal, the City Council shall adopt a resolution containing a pr~iiminar'y ~ssessment stating that the City should not renew the franchise. SECTION 4: If the City Council adopts a resolution assessing that the City should not renew the franchise, the Public Works Director shall request the City Clerk to publish notice of a public hearing at a special meeting of the City Council to consider denial of renewal of', frs,qchise. Said special meeting shall take place within thirty (30) days of adoption of the statement of non-renewal. At the conclusion of the public hearing, the City Council may deny renewal of the franchise if it makes adverse findings in reviewing the following factors: A. Whether the cable operator substantially complied with the material terms of the existing franchise' and applicable law, and the City provided the cable operator sufficient notice and an opportunity to cure any failure to comply. B. Whether the quality of the cable operator's service, including signal quality, response to consumer complaints, and billing practices, was reasonable in light of community needs, and the City provided the cable operator sufficient notice and an opportunity to cure any defects. In reviewing this factor, the City cannot consider the' mix or quality of cable services or other services provided over the system (content). C. Whether the cable operator has the financial, legal, and technical ability to provide the se,wices, facilities, and equipment as set forth in its proposal. D. Whether the cable operator's proposal is reasonable to meet the future cable- related community needs and interests, taking into account the cost of meeting such needs and interests. iil -2- 1063£~\1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 18 17 18 19 2O 21 22 23 24 25 26 27 28 PASSED A~,.ADOPTED a't a regular meeting of the City Council of the City of Tustin on the ~ / day of ~, 1999. ,,// ATTEST: PAMELA STOKER CITY CLERK -3- RESOLUTION CERTIFICATION STATE OF CALIFORNIA ) COUNTY OF ORANGE ) ss CITY OF TUSTIN ) RESOLUTION NO. 99-49 Pamela Stoker, City Clerk and ex-officio Clerk of the City Council of the City of Tustin, California, does hereby certify that the whole number of the members of the City Council is five; that the above and fore~goin§ resolution was passed and adopted at a re§ular meetin§ of the City Council held on the 2:1st day of June, :1999, by the following: vote: COUNCILMEMBER AYES: COUNCIL~EMBER NOES: COUNCILMEMBER ABSTAINED COUNCILMEMBER ABSENT: Worley, Thomas, Doyle, Ports, Saltarelli None None None Pamela... ~..,...,~.'-~'~:., City Clerk