Library Disc/Cable TV Providers
CITY OF
CHANHASSEN
City Cmt" Driv" PO Box 147
ianhosJm, Minn,!ota 55317
Phon, 612.937.1900
;,n"al Fax 612.937.5739
¡in"ring Fax 612,937.9152
ilie Saftty Fax 612.934.2524
'b www.d.ehanhosJm.mn.".
MEMORANDUM
TO:
Mayor
City Council
Scott A. Botcher, City Manager~
FROM:
DATE:
June 6, 2000
SUBJ:
Library Discussion
Please make note that the meeting of June 12,2000 will begin at 4:00 p.m.,
convened in a work session in the Courtyard Conference Room. The first item
to be discussed will be some issues involving a library consistent with the
Council's recommendation of several weeks ago. By my way of thinking, I
have noted four issues that I believe a majority of the Council would like to
discuss, This is not meant to be a comprehensive list, so if! have miiised a topic
of particular interest to an individual member, please feel ftee to discuss it at this
time.
1. Referendum: While I believe there is a consensus on the Council that
this issue should go to referendum, I would like to ensure that this is the
case, and if it is, that there is an agreement on the date for the
referendum. As I stated previously, it is my recommendation that a
referendum be held in November at the same time as the general
election. My reasons for making such 'a recommendation are discussed
in my memo dated May 18, 2000.
2. City Center Commons: Individuals have discussed the improvement of
City Center Commons above and beyond the potential construction of a
library. I think that it may behoove the Council to be made aware of the
impacts, both desired and undesired, a potential library mayor may not
have on the City Center Commons site. I believe there is no reason that
the library construction, if approved by the voters, should not go ahead;
however, I believe that the Council should keep in the back of its minds
that in the near term it may be in the City's interests to move ahead with
final development and construction of the City Center Commons area,
3. Regional vs. City Library: There have been some discussions as to
whether or not this is a regional library or a city/municipal library. From
my way of thinking, this is simply a discussion focusing on
nomenclature. I ftankly don't see much of a difference regardless of
what term you use. That being said, there has been some discussion
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Mayor and City Council
June 6, 2000
Page 2
among some Council members as to whether or not the population
estimate(s) in the Needs Assessment is (are) appropriate. Our individual
community is not estimated to be 40,000 people, and by using this
number in the Needs Assessment, we have included individuals who are
not residents of Chanhassen in some of the conceptual discussions.
From a practical point of view, these people will use your library
whether or not you want them to and, given the current methodology for
the provision oflibrary services in Carver County, all cities that build
libraries will have individuals use their facilities that are not paying for
them. (This is probably a good argument for the County to take over a
library system in total, including the construction of the building. I
believe that to be pie in the sky and ftankly don't believe that will ever
happen.) As I see it, I personally don't have a great concern over the
population numbers Jeffused in the Needs Assessment, but this is an
issue that several Council members have raised in the past.
4. Potential Inclusion of County Library Offices: Also included in the
Needs Ássessment is the potential inclusion of Carver County Library
Offices within this building. The inclusion of County Library Offices
within the new building could result in a small increase in building costs,
as more space may be necessary than otherwise contemplated. However,
again, I don't get great heartburn over this issue, as I believe that the cost
of the space (in a lease) can be calculated in such a manner to more than
cover our expenses. At no time do I expect to provide the County with
free office space for the Carver County Library System. There will be
rent paid and it will have to be a fair market rent. Additionally, in my
mind, this space will have to be pre-leased; that is, the City and County
will have to agree on the cost for the space prior to the space being built.
These are my thoughts at this point, and certaiuly there are many twists and
turns within these issues and other issues that you may wish to bring to the table.
However, I provided this list to give us a ftamework to begin discussion. I have
allocated one hour for this particular discussion.
Thank you.
g:\user\scottb\Jibrary6-12.doc
CITY OF
CHANHASSEN
CityCmt"Driv"POBox 147
\anhassen, Minn,,,ta 55317
Phon, 612,937.1900
':;m"ai Fax 612.937.5739
'gin,ering Fax 6/2,937,9/52
blic Saftty Fax 6/2,934.2524
lb www.ci.chanhassen.mn.us
MEMORANDUM
TO:
Mayor
City Council
FROM:
Scott A. Botcher, City Manager
~
DATE:
June 5, 2000
SUBJ:
Brian Grogan Presentation on Cable Television
Mr. Grogan will be present on June 12th to discuss the opportunities and legal
parameters of soliciting and franchising additional cable television providers.
Please find attached copies of correspondence from Mr, Grogan communicating
the issues involved and draft documents that will be effectuated should the
Council decide to pursue these opportunities.
Thank you for your attention to this matter. Mr, Grogan will be happy to answer
any questions you may have at the meeting.
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MOSS & BARNETT
A Professional Association
MEMORANDUM
TO: Scott Botcher
FROM:
DATE:
RE:
Brian T. Grogan
CLIENT: 27981.7
June 2, 2000
Competitive Cable Television Franchising Process
You asked that I prepare a brief description of the state statutory franchising process to
provide your City Council with an overview of the steps required to process a request for
a cable television franchise. In particular, Everest Connections Corporation ("Everest")
has expressed interest in constructing a competitive cable television system within the
City. Everest is proposing to "overbuild" the current cable system operated by .
Mediacom. To that end, a second set of wires would be installed throughout the City to
provide subscribers with additional choices regarding their cable television service
provider. Yet another company, WideOpenWest ("WOW"), has also approached
several other Twin City communities for a cable television franchise, and WOW may
also submit an application in Chanhassen.
Under state law at Chapter 238, the City is required to publish a Notice of Intent to
Franchise in its local newspaper once each week for two successive weeks. This
Notice informs all prospective applicants of the fact that the City will be considering the
grant of additional cable television franchises and the terms under which consideration
will take place. The state statute also requires that an application form be prepared
which outlines the precise requirements which must be included within any application
submitted to the City. We have prepared and attached hereto a draft Notice of Intent to
Franchise and Request for Proposals Official Application Form for the City's review and
consideration.
State law also requires that applications cannot be submitted sooner than twenty (20)
days after the date of first publication. Therefore, once the City Council authorizes
publication of the enclosed Notice of Intent to Franchise, an application due date can be
determined. Many cities which are considering publication of the Notice at their first
meeting in June are publishing during the second and third weeks of June, and are
establishing a deadline for applications approximately the second week of July.
Mr. Scott Botcher
June 2, 2000
Page 2
Upon receipt of one or more applications, the City will then review the applications to
determine whether the applicant possesses the requisite legal, technical, and financial
qualifications to own and operate a cable television system. This analysis is analogous
to the transfer review proceedings which the City has been involved with. However,
additional consideration is given to the fact that any new applicant will be seeking to
construct a system throughout all of the City's rights-of-way which may cause disruption
and which therefore may justify a higher construction bond, security fund and other
appropriate provisions.
We generally recommend that the City reserve approximately two to four weeks to
review the applications which have been submitted. Thereafter, state statutes require
the City to conduct a public hearing to review the applications. Many cities are
scheduling such public hearings for their first meeting in August with the hope that City
staff will have had an opportunity to review the applications prior to the public hearing so
that key questions can be raised at that time. Upon close of the public hearing the City
must wait a minimum of seven (7) days before considering the grant of a franchise to a
qualified applicant. There is no time period prescribed within which the City must take
action, only that the action cannot be taken until seven (7) days following the close of
the public hearing,
Typically, cities will use the existing franchise granted to the incumbent cable operator,
in this case Mediacom, as a starting point for franchise negotiations. Under Minnesota
statutes we cannot grant any new competitor more favorable terms and conditions with
respect to 1) area served, 2) PEG access provisions, and 3) franchise fees. In addition,
within the Chanhassen franchise documents the City has stipulated that no competitor
will be granted a franchise on more favorable terms and conditions.
State law also allows for the City to be reimbursed for any costs or expenses associated
with the franchising process. Typically, cities will impose an up front application fee with
a condition that any additional costs or expenses incurred during the process must be
reimbursed by the successful applicant upon the grant of the franchise, Some large
cable commissions around the City have imposed application fees as high as $50,000
while many other have imposed fees of between $10,000 and $20,000.
If you should have any additional questions regarding the process, please feel free to
contact me. Otherwise, I look forward to working with the City on this matter.
Mr. Scott Botcher
June 2, 2000
Page 3
339414/1
Draft -for discussion purposes only
CITY OF CHANHASSEN, MINNESOTA
REQUEST FOR PROPOSALS OFFICIAL APPLICATION FORM
Applicants interested in submitting a proposal for a cable communications ftanchise shall
submit the following information as required by Minnesota Statutes Section 238.081 (subd, 4) to the
City of Chanhassen, Minnesota on or before , 2000.
A,
B.
c.
334983/1
Plans for channel capacity, including both the total number of channels capable of
being energized in the system and the number of channels to be energized
immediately.
A statement of the television and radio broadcast signals for which permission to
carry will be requested ftom the Federal Communications Conunission,
A description of the proposed system design and planned operation, including at
least the following items:
D,
I, The general area for location of antenna and headend, if known;
2. The schedule for activating and two-way capacity;
3, The type of automated services to be provided;
4. The number of channels and services to be made available for access cable
broadcasting; and
5, The schedule of charges for facilities and staff assistance for access cable
broadcasting,
Terms and conditions under which particular service is to be provided to
governmental and educational entities.
E,
A schedule of proposed rates in relation to the services to be provided and a
proposed policy regarding unusual or difficult connection of services,
F,
A time schedule for construction of the entire system with the time sequence for
wiring various portions of the City of Chanhassen, Minnesota,
G,
A statement indicating the applicant's qualifications and experience in the cable
communications field, if any.
H.
An identification of the municipalities in which the applicant either owns or operates
a cable communications system, directly or indirectly, or has outstanding ftanchises
for which no system has been built.
L
Plans for financing the proposed system, which must indicate every significant
anticipated source of capital and significant limitations or conditions with respect to
I
334983/1
the availability of the indicated sources of capital. This information shall include the
following:
J.
I. List and describe all financial resources (committed or otherwise) which
the applicant proposes to use in constructing and operating the system.
Committed financial resources may include, but are not limited to: bank
financing; existing capital reserves; capital calls (or equivalent rights)
under definitive governance documents of the applicant; operating surplus
to be generated ftom operating activities; or resources generated through
the issuance of debt or equity securities.
2. With respect to each of the sources described in I above, provide
supporting documentation (such as a commitment letter ftom a financial
institution; copies of definitive governance documents; terms sheet for
debt or equity securities...) establishing the total resources available and
the amount of resources appropriated for the cable ftanchise operations, if
different from total funds available.
3, To the extent any of the financing sources described in I above have
limitations or conditions imposed by such financing source on availability,
use or other restrictions which could reasonably be expected to adversely
affect the availability of such financial resources for use by the applicant,
describe in detail: (a) each such limitation or condition; (b) the means the
applicant intends to employ in order to satisfy each such limitation or
condition; (c) a projection as to when such conditions or limitations will
be satisfied (to the extent practical); (d) any contingent sources of capital
or financial resources which may be sought in the event such conditions or
limitations are not met; and (e) the reasonably foreseeable effect of the
loss of each such source of financing on the applicant's ability to meet its
obligations to the City.
4. Provide a detailed budget or other financial forecast which identifies the
total capital resources which the applicant projects will be required to
construct and operate the cable ftanchise system in the City for the lesser
of five (5) years or until the applicant otherwise projects that the cash
deficit from operations will be reduced to zero, including a summary of
the material assumptions employed in such forecast or budget.
5. Provide financial statements (balance sheet, statement of operations and
statement of cash flow) for each of the two immediately preceding fiscal
years, together with the most current set of financial statements for the
current fiscal year, all prepared in conformity with generally accepted
accounting principles (except as noted).
A statement of ownership detailing the corporate organization of the applicant, if
any, including the names and addresses of officers and directors and the number of
shares held by each officer or director, and intercompany relationship, including the
parent, subsidiary or affiliated company.
2
K. A notation and explanation of omissions or other variations with respect to the
requirements of the proposal.
1. Plans for construction and use of right-of-way, as follows:
1. Describe the level of interference landowners will experience with the
installation of equipment by the applicant.
2. Describe what steps the applicant is planning to take to mitigate how long
the installation of the equipment will take.
3. Describe what steps the applicant is planning to take to inform residents of
the equipment installation and any safety concerns or safety measures related
thereto.
4, What percent of equipment does the applicant anticipate will be installed
above-ground and what percent underground?
5, To what extent does the applicant anticipate the need to detour traffic or
close certain roads, sidewalks, or other rights-of-way to accommodate
construction or installation of equipment.
6, What steps is the applicant planning to take to minimize destruction of
public and/or private property during construction and installation?
7. Will the applicant agree to pay for any and all costs to repair public and/or
private property to as good a condition as its was prior to construction and
installation?
8. Where does the applicant intend to store its equipment during construction,
and what measures will it be taking to keep conditions safe ftom children,
traffic or any other persons who may go near it.
9. What will the applicant do with the equipment during the winter months
when construction may be delayed or temporarily discontinued?
10, Does the applicant believe it will be able to collocate its equipment with that
of existing cable companies, and what steps has and will the applicant take to
determine the feasibility of collocation?
11. Is the applicant committed to collocate its equipment if technically feasible?
12. What steps does the applicant take to secure cable and equipment so there is
minimal aesthetic interference?
Substantive amendments may not be made to a proposal after a proposal has been submitted
to the City of Chanhassen, Minnesota and before the award of a ftanchise. All proposals must be
notarized and must include detailed responses to the above information requests, as well as the
information requested in the Notice by the City ofIts Intent to Franchise a Cable Communications
System, attached hereto as Attachment A.
The City of Chanhassen, Minnesota reserves its rights to request additional information of
applicant at any time during this process,
334983/1
3
Applicants are advised that Mediacom, LLC, currently provides cable television service
throughout the City of Chanhassen, Minnesota, pursuant to Ordinance No. which became
effective on or about , and which will expire on or about
, _. Applicant's proposal should identifÿ any issues or concerns it may have regarding
Ordinance No. as this Ordinance will serve as the basis on which a ftanchise may
granted to any qualified applicant.
Any questions regarding this Request for Proposals or the exhibits attached hereto may be
directed to Mr. Scott Botcher, City Manager, City Hall, 690 City Center Drive, Chanhassen,
Minnesota 55317.
334983/1
4
33498311
ATTACHMENT A
NOTICE BY THE CITY OF ITS INTENT TO FRANCHISE
A CABLE COMMUNICATIONS SYSTEM
A-I
Draft -for discussion purposes only
NOTICE BY THE CITY OF CHANHASSEN, MINNESOTA
OF ITS INTENT TO FRANCHISE A CABLE COMMUNICATIONS SYSTEM
Notice is hereby given that it is the intent of the City Council of the City ofChanhassen,
Minnesota, to consider the grant of an additional franchise(s) for the purpose of constructing a
cable communications system to serve the City of Chanhassen, Minnesota. This notice is given
in accordance with the requirements of Minnesota Statutes Section 238.081.
Applications shall be submitted in response to this Notice and to a Request for Proposals
and Proposed Franchise Documents available on request in the office of the City Manager, 690
City Center Drive, Chanhassen Minnesota 55317, phone: 612-937-1900.
A. The deadline for submitting applications is , 2000.
E,
334984/1
B.
Applications shall be in writing, notarized, in a format consistent with the Request
for Proposals, and sealed with U copies enclosed. Each application
shall include a nonrefundable application fee of Fifteen Thousand Dollars
($15,000) in the form ofa certified check made payable to the City of
Chanhassen, Minnesota. The applications shall be delivered to the attention of the
City Manager, 690 City Center Drive, Cha1Ìhassen Minnesota 553 I 7, phone: 612-
937-1900, Applicants are hereby on notice that any and all costs incurred by the
City with respect to the ftanchise procedure and ftanchise award shall be
recovered from applicant.
C.
Applicants are requested to be present at a public hearing before the City Council,
that is presently schyduled to be held at City Hall, beginning at p.m.
on , , 2000. Each applicant will be given time to
summarize its application, The City Council may then continue the public
hearing to permit further review of the application before a final decision is made
to select qualified applicants,
D,
The Request for Proposals and Proposed Franchise Documents set forth in detail
the expectations of the City of Chanhassen, Minnesota and the requirements of
the content of the franchise proposal and are made in conformance to the
requirements of Minnesota Statutes Section 238.081, subd, 4,
The desired system design and services to be offered are identified in the
Proposed Franchise Documents attached to the Request for Proposals and include
a system serving the entire City of Chanhassen, Minnesota with a reasonable line
extension policy; flexibility to increase channel capacity; public, educational and
govemmental access channels supported by the operator; reasonable rates; a mix,
level and quality of programs and services comparable to other systems and
customer services and maintenance plans to ensure the highest degree of service
to the subscriber. The Request for Proposals and Proposed Franchise Documents
provide further details of the desired system design and services to be offered.
I
'"
F. The criteria for evaluating the applications and priorities for selection are as
follows:
I. The completeness of applications, conformance to Request for Proposal,
and Proposed Franchise Documents;
2, The system design;
3. The programs and services offered initially and criteria for adding
programs and services;
The initial service area and the line extension policy;
The time for construction;
4.
5.
6,
7.
8.
Customer service policies and system testing;
The legal, technical, and financial qualifications ofthe applicant; and
The proposal for community services, including public, educational, and
governmental access,
Applications which meet the above criteria in the opinion of the City Council
shall be considered for a ftanchise. Each above criterion has equal weight.
However, no applicant will be selected unless it is approved in all of the above
categories of criteria,
H.
1.
The applicant( s) selected by the City Council will be required to accept the
Franchise Documents granted within fifteen (15) days after adoption and will also
be required to reimburse the City for the expenses not covered by the application
fees, as provided for by Minnesota Statutes Section 238,081, subd, 8.
J.
All questions concerning this request should be directed to Mr. Brian T, Grogan,
Moss & Barnett, P,A" 4800 Norwest Center, 90 South Seventh Street,
Minneapolis, Minnesota 55402-4129, phone (612) 347-0340, the City's legal
advisor regarding this process,
Date:
.2000
. City Manager
Publish in:
on
, 2000 and
2000. Affidavit of
Publication required for each publication.
334984/1
2
334984/1
EXHIBIT A
REQUEST FOR PROPOSALS OFFICIAL APPLICATION FORM
A-I
EXHIBIT B
PROPOSED FRANCHISE DOCUMENTS
334984/1
B-1