D. Mediacom Franchise RenewalPark & Recreation . Rates for basic cable services.
Phone: 952.227.1120
Fax: 952.227.1110 • Customer service issues, including billing disputes, office hours, telephone
availability of personnel, installations, outages, and service calls.
Recreation Center . "Leakage" from cable systems (interference with other broadcast and
2310 Coulter Boulevard narrowcast media).
Phone: 952.227.1400
Fax: 952.227.1404 • Indecency and obscenity in cable programming.
Planning &
The franchise agreement with the city covers issues such as:
Natural Resources
MEMORANDUM
CITY OF
CHANHASSEN
TO: Todd Gerhardt, City Manager
0 System design provisions
7700 Market Boulevard
FROM: Laurie Hokkanen, Assistant City Manager
PO Box 147
Greg Sticha, Finance Director
Chanhassen, MN 55317
Fax: 952.227.1310
DATE: June 4, 2012 d� •
Administration
SUBJ: Franchise Renewal Process
Phone: 952.227.1100
Fax: 952.227.1110
BACKGROUND
Building Inspections
provider in Chanhassen. This is not unlike most of the metro area. There is
Phone: 952.227.1180
The City entered into a cable franchise agreement with a fifteen -year term in
Fax: 952.227.1190
1998. The agreement will expire on August 31, 2013. The franchise agreement
governs the use of the city's rights -of -way (ROW) by the cable company. This
Engineering
Phone: 952.227.1160
regulation is needed because cable companies are the only companies allowed to
Fax: 952.227.1170
work in the city ROW that are not regulated by the Public Utilities Commission.
Finance
In Minnesota, cable regulation is mostly shared between the federal and municipal
Phone: 952.227.1140
Fax: 952.227.1110
government. The federal government, through the FCC, is responsible for:
Park & Recreation . Rates for basic cable services.
Phone: 952.227.1120
Fax: 952.227.1110 • Customer service issues, including billing disputes, office hours, telephone
availability of personnel, installations, outages, and service calls.
Recreation Center . "Leakage" from cable systems (interference with other broadcast and
2310 Coulter Boulevard narrowcast media).
Phone: 952.227.1400
Fax: 952.227.1404 • Indecency and obscenity in cable programming.
Planning &
The franchise agreement with the city covers issues such as:
Natural Resources
Phone: 952.227.1130
Fax: 952.227.1110
• Requirements of Mediacom for insurance (liability, workers comp, etc.)
0 System design provisions
Public Works
. Franchise Fee
7901 Park Place
• Public Access Provisions
Phone: 952.227.1300
Fax: 952.227.1310
CURRENT SITUATION
Senior Center
Phone: 952.227.1125
Although the franchise agreement is not exclusive, Mediacom is the sole cable
Fax: 952.227.1110
provider in Chanhassen. This is not unlike most of the metro area. There is
Web Site
simply not enough density /business in Chanhassen to persuade a second company
www.ci.chanhassen.mn.us
to invest in building and maintaining a second cable system.
Chanhassen is a Community for Life - Providing for Today and Planning for Tomorrow
Mr. Todd Gerhardt
June 11, 2012
Page 2
Please note that the franchise agreement only covers the provision of cable
television. Although Mediacom is also in the phone and internet business, those
services are not included in the franchise agreement.
The city receives a 5% franchise fee and a Public, Education, and Government
Access (PEG) fee of 50 cents per subscriber per month. The franchise fee dollars
are able to be used as the city council sees fit. The PEG dollars are used to
support the capital equipment necessary to broadcast public meetings and other
programming on Channel 8. The PEG fee was lowered from 84 cents to 50 cents
in 2012 at Mediacom's request.
I' : 01"I :
The city's attorney in matters related to telecommunications is Brian Grogan of
Moss & Barnett in Minneapolis. Brian assisted the city with the 1998 Agreement
as well as the recent audit. City staff has engaged Mr. Grogan to assist us with
the renewal process.
In order to understand the future needs related to the PEG fee, staff has engaged
the services of Cheryl Johnson at Columbia Telecommunications Corporation.
Ms. Johnson and her team of engineers will be assessing our current equipment
and helping us understand and project our capital needs over the next 10 years.
There are many technology changes that will be necessary in the future to allow
us to continue to broadcast public meetings. This work should take 3 -4 months to
complete.
Following is a list of items that staff has brainstormed for consideration during the
renewal process:
➢ Clarify requirement for cable to be installed in new developments concurrent
with other utilities
➢ Possibility of extending service to areas currently un- served (mostly south of
Pioneer Trail)
➢
Channel 8 Issues
➢ Placement of Channel 8 in line -up / Availability of Channel 8 in HD
➢ Availability of PEG programming in Video On Demand.
➢ Clarify calculation of the franchise fee. We would like to better understand
how bundling and bad debt are addressed. We would also like Mediacom to
Mr. Todd Gerhardt
June 11, 2012
Page 3
pay for the franchise fee audit if an error that exceeds 5% of annual revenue
is discovered.
➢ Clarify that City Code has precedence over franchise agreement.
PROPOSED TIMELINE
November - December 2012: Moss & Barnett draft franchise documents
January — February 2013:
February 2013:
February — July 2013:
August 13, 2013:
August 31, 2013:
RECOMMENDATION
City's review & modification of the documents
Finalize documents and forward to Mediacom
Final negotiations
Adoption of franchise documents
Existing franchise expires
Staff is looking for feedback on the outlined approach and timeline from the city council.
No action is required at this time.