HomeMy WebLinkAbout15 MEDIA ONE FEES 04-20-98DATE:
NO. 15
4-20-98
April 15, 1998
I nte r-Come
TO:
FROM:
SUBJECT:.
William A. Huston, City Manager
Ronald A. Nault, Finance Director
MEDIA ONE MISALLOCATION OF CABLE FRANCHISE FEES
SUMMARY: The results of an ~independent audit of Cable Franchise Fees indicated that
approximately 1487 subscribers of Media One Cable Service have been credited to the County in
error. After several months of negotiations with Media One, the City has accepted a one time
settlement of $315,000 and correction of the misallocated subscriber accounts.
RECOMMENDATION:
Accept the negotiated settlement with Media One, and:
1. Deposit $289,000 into the Park Development Fund as a reserve for future projects.
,
Deposit $26,000 into the Capital Projects FUnd and appropriate same for modification
to the Finance Department to provide additional work space and for completion of the
network implementation.
FISCAL IMPACT:
One time settlement of $315,000, ongoing increase of Cable Franchise fees of
approximately $25,000 per year.
DISCUSSION:
The County of Orange notified the City of Tustin in mid-1997 that they were in the process
of auditing their Cable Providers and preliminary information indicated that several areas
along the City/County borders had been misallocated regarding subscriber units. Shortly
thereafter we were contacted by Media One to make us aware of the findings and we
began discussions on correcting the problem and determining the prior period amount due
the City.
Working with the City Revenue Auditors, Municipal Resource Consultants, we determined
there were approximately i487 units misallocated, going back ten years. The ten years
coincides with the date that Media One purchased the franchise from Dimension Cable.
After several months of negotiations, we agreed upon a settlement of $315,000. A check
for this amount is due to the City the week of April 13. Our Revenue Auditors are
monitoring the corrections to the subscriber base as of December 1997.
-,
Ronald A. Nault
Finance Director
RAN:ts
RAN7:Media One 98.Agenda