Mediacom TV Cable Franchise Ext
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MEMORANDUM
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June 14,2004
,-
TO:
The Honorable Mayor and City Council Members
FROM:
Michael C. Van Milligen, City Manager
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SUBJECT: Mediacom Franchise Extension
The actions the City Council has taken recently to spur Mediacom into taking the
negotiations process seriously appear to be working.
The Formal Renewal Process is proceeding and Mediacom understands that could end
up in denial of franchise renewal.
The Franchise Fee Payment Analysis to analyze franchise fee payments made by
Mediacom to the City in calendar years 2002 and 2003 is progressing.
The Technical System Audit, which is a technical design and performance review of the
Mediacom system, will include on-site inspections in July.
Informal discussions have been held and Mediacom has announced new services.
Hopefully, Mediacom will continue to make attempts to resolve issues the City has
identified.
Cable Franchise Administrator Merrill Crawford is recommending a six month extension
to December 31, 2004, of the Franchise Agreement to give these processes time to be
completed. It is anticipated that this will be the last requested extension.
I concur with the recommendation and respectfully request Mayor and City Council
approval.
M;~~"dL"
MCVM/jh
Attachment
cc: Barry Lindahl, Corporation Counsel
Cindy Steinhauser, Assistant City Manager
Merrill Crawford, Cable Franchise Administrator
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CITY OF DUBUQUE, IOWA
MEMORANDUM
June 14, 2004
MEMO TO: Michael C. Van Milligen, City Manager
FROM: Merrill Crawford, Cable Franchise Administrato~
SUBJECT: Mediacom Franchise Extension
INTRODUCTION: The purpose of this memorandum is to recommend that the City
Council grant an additional six-month extension of the existing Mediacom cable
franchise and side agreements under the terms currently in effect.
BACKGROUND: At their December 15, 2003 meeting, the City Council adopted
Ordinance No. 100-03 extending the current cable franchise with MCClowa, LLC
(Mediacom) to June 30, 2004.
On February 16, 2004, the Council authorized the advancement of the Formal
Renewal Process as provided in the 1984 Cable Act, in tandem with the continuation
of informal negotiations. On March 15, the Council approved a contract with Lewis &
Associates of Hollywood, FL to conduct a franchise fee payment analysis and also
authorized the expanded scope of services of the Miller & Van Eaton law firm and
CBG Communications, Inc. to include the component tasks of the Formal Franchise
Renewal Process.
The tasks of the Formal Renewal Process are proceeding as planned:
1. Franchise Fee Payment Analysis - On March 15, 2004, the City Council approved
a contract with Lewis & Associates, of Hollywood, FL to analyze franchise fee
payments made by Mediacom to the City of Dubuque in calendar years 2002 and
2003. The firm has reconciled Mediacom's address database with the City's GIS
address database. A few discrepancies were found and resolved. On May 21, Lewis
received from Mediacom a package of requested supporting data re: the computation
and payment of franchise fees to the City over the two-year studied period. On June
7, consultant Scott Lewis informed us that requested supporting information
pertaining to Mediacom's non-subscriber revenue streams (advertising, home-
shopping, fiber leases, etc.) was not included in the package. Mediacom has
apologized for the omission and is gathering the data.
2. Technical System Audit - (Note: this is not a financial audit as reported in the
Telegraph Herald in February. It is a technical design and performance review of
Mediacom's Dubuque cable system, measuring compliance with franchise standards,
FCC rules, and other relevant codes.) Mediacom has prepared a package of
information in response to requests by CBG Communications for system technical
reports, test data, and answers to specific technical questions. Upon delivery, we will
forward the material to CBG Communications. Next week, Dick Nielsen of CBG will
perform on-site inspections and tests in Dubuque. Additional meetings will be
occurring with Mediacom representatives and others while Mr. Nielsen is in town.
3. RFRP - Attorney Rick Ellrod of the Miller and Van Eaton law firm has begun
preparation of the detailed Request For Renewal Proposal that lies at the core of the
Cable Act's Formal Renewal Process. In the Formal Process, when the very specific
RFRP is presented to the cable operator, the operator has a single opportunity to
respond with a proposal that reasonably meets the community needs as detailed in
the RFRP, taking into account the cost of meeting those needs. That essential
question becomes the focus of a formal administrative hearing and likely court
proceedings which eventually determine whether, and under what terms, the cable
franchise is renewed, per federal law.
4. Related Ordinances - Mr. Ellrod will also be working with the City's Legal Services
Department and the franchise renewal negotiating team on the framework of
ordinances needed to enact the provisions of the renewed franchise and otherwise
protect the City's interest in the use of public rights of way for cable and
telecommunications services.
In the meantime, meetings continue between City and Mediacom negotiators,
attorneys, and technical experts under the informal negotiating process, which both
sides hope will produce a sound agreement.
While specific details of individual negotiating sessions cannot be made public at this
time, I can report progress in most key elements of the City's concerns. The tone of
negotiations and level and pace of information exchange have also improved as we
work through very complicated technical and financial issues that surround such
items as the Institutional Network, local community programming, business
infrastructure and services, a lower-priced "broadcast basic" option, and broadcast
signal quality issues. We note that Mediacom's investment and system upgrade
activity in the community continues absent the prospect of a long-term future in
Dubuque that a renewed franchise would assure.
As you know, Mediacom upgraded its Dubuque system from 550 Mhz to 750 Mhz
bandwidth in the Summer and Fall of 2003 to enable the offering of additional video,
voice and data services. This was accomplished, in part, by upgrading electronic
components, re-spacing some amplifiers, and installation of some additional fiber
optic cable in outlying areas.
Mediacom has also been finishing and lighting its long-haul fiber optic network,
connecting the Dubuque headend to other systems in the Tri-states and beyond.
We've begun to see the diverse practical effects of these interconnections, for
example, in Mediacom's preliminary plan to import the KFXA Fox broadcast signal by
fiber to replace the current KFXB signal later this year. We've also noticed that cable
channel override alerts for severe weather or other emergencies now occur
simultaneously in a surrounding cluster of communities as they occur in Dubuque; a
development which carries both advantages and disadvantages, depending upon the
circumstances.
In February, Mediacom doubled the potential download speed of its residential and
cottage business cable modem service, and in mid-May, introduced a mid-speed
(128Kbps) cable modem service priced to compete directly with phone companies'
DSL products and to draw "average" Internet users away from traditional dial-up
Internet Access via phone lines.
On May 12, Mediacom introduced its first package of High Definition TV products in
Dubuque and has since added to the HDTV line-up. They have also introduced
Video-On-Demand services, including digital video recorder devices.
On May 21, Mediacom invited area business representatives to a luncheon meeting
at Dubuque Greyhound Park for a presentation about the variety of voice-data-video
broadband networking options now available in Dubuque and the surrounding area
from their new Enterprise Networks Division. Chris Kohlmann and I attended.
Mediacom announced the inauguration of IP-delivered business services in Dubuque,
including Local Area Networks (LAN), Virtual Private Networks (VPN), dedicated
Internet links, and point-to-point links of custom-configurable capacities and speeds.
They also announced a plan to roll out Voice-Over-IP competitive telephone services
early next year.
If the range of capabilities and pricing of these new broadband services are in
practice as they were described at the presentation, they represent significant
technical and competitive alternatives for Dubuque area businesses needing local
network connections as well as high-capacity fiberoptic links to the outside world.
We do, however, intend to quiz Mediacom further as to certain technical features and
design elements of their new business services, particularly as to reliability,
redundancy, priority attention should a problem occur, and worst case scenario
installation costs if a particular business is not located close to a fiber node.
Meanwhile, as in the past, it is essential to the preservation of current franchise
benefits and the protection of the interests of the City and cable subscribers that the
current franchise extension not be permitted to expire by default on June 30.
RECOMMENDED ACTION: The Recommended Action is that, following the June
21, 2004 public hearing, the City Council adopt the proposed ordinance extending
Mediacom's present franchise and associated leases to December 31,2004, under
the same terms as previous extensions and authorizing the City Manager to execute
the Agreement.
cc:
Cindy Steinhauser, Assistant City Manager
Barry Lindahl, Corporation Counsel
Tim O'Brien, Assistant City Attorney
Cable TV Regulatory Commission
Cable Community Teleprogramming Commission
Prepared by: Merrill Crawford. Cable Franchise Administrator. City Hall Annex. 1300 Main St. Dubuque. IA 52001-4732
ORDINANCE NO. 41-04
AN ORDINANCE EXTENDING THE TERM OF THE EXISTING CABLE
FRANCHISE AGREEMENT AND HUB SITE LEASE OF MCCIOWA, LLC. TO
DECEMBER 31, 2004.
Whereas, MCClowa, LLC. (Media com) is the current holder of a cable services
franchise, embodied in Ordinance No. 42-81, as modified by a series of waivers and
side agreements, and acquired from TCI of Iowa, Inc. via a transfer approved by the
Dubuque City Council on June 18, 2001; and
Whereas, one of the side agreements is a lease to Mediacom to build and
maintain a network hub on City-owned property located at 1585 West Third Street in
Dubuque; and
Whereas, the terms of the franchise and of the lease will expire June 30, 2004;
and
Whereas, representatives of the City of Dubuque and of Mediacom have entered
into good faith negotiation of terms and conditions for the renewal of the franchise and
the lease.
NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY
OF DUBUQUE, IOWA:
Section 1. The term of the cable services franchise and the term of the lease are
hereby extended to December 31, 2004, with all the rights, privileges and
responsibilities appertaining thereunto; and
Section 2. The City Manager is hereby authorized to sign and administer the
extension agreement on behalf of the City of Dubuque.
Passed, approved and adopted this 21st day of June, 2004.
Terrance M. Duggan, Mayor
Attest:
Jeanne F. Schneider, CIty Clerk
AGREEMENT EXTENDING
THE TERM OF THE CABLE FRANCmSE GRANTED TO
MCC IOWA LLC
This Agreement, made this - day of June, 2004, by and between the City of Dnbuque,
Iowa, an Iowa municipal corporation (hereinafter the "City"), and MCC Iowa LLC, a
Delaware corporation (hereinafter "Mediacom").
WITNESSETH:
WHEREAS, Mediacom currently holds a cable franchise (the "Franchise") from the
City subject to Ordinance No. 42-81 ("Dubuque Cable Services Franchise"), Resolution No.
110-87, Resolution No. 284-88, Resolution No. 349-94, Resolution No. 521-98, Resolution
No. 445-99, Resolution No. 108-00, and Resolution No. 275-01; and to Ordinance No. 69-93,
all of which documents, as any of them may lawfully be or may have been amended from time
to time, are collectively referred to as the "Franchise Documents"; and
WHEREAS, the parties are currently negotiating the renewal of the Franchise; and
WHEREAS, the parties have agreed that an extension of the current Franchise, in order
to complete negotiations, and to take such other actions as may be appropriate to resolve
renewal issues, is to the benefit of both parties;
WHEREAS, Mediacom has consented to the terms of this extension;
NOW, THEREFORE, in consideration of the promises and undertakings herein, the receipt
and adequacy of which are hereby acknowledged, the parties hereby agree as follows:
Section 1.
The Franchise, which was scheduled to expire on June 30, 2004, is
extended from that date until December 31,2004 (the "extension period").
1
Section 2. During the extension period, and any subsequent extension periods, if any,
all the terms and conditions set forth in the Franchise Documents shall continue in full force
and effect.
Section 3. This extension shall be without prejudice to any rights of either party under
the Cable Communications Policy Act of 1984, as amended. For example, and by way of
illustration and not limitation, any rights Mediacom may have already asserted properly under
47 U.S.C. § 546(a) need not be asserted again, and are not affected by the extension.
Similarly, the extension will not be read to give Mediacom additional rights or opportunities to
trigger the provisions of 47 U.S.C. § 546(a)-(g), or to require the City to reconduct hearings
or other actions properly taken in conjunction with any renewal proceedings under either or
both of the Franchises. No claim that either party may have against the other shall be released
or otherwise affected by this extension.
IN WITNESS WHEREOF, the parties hereto have set their respective hands and seals on the
day first above written.
CITY OF DUBUQUE, IOWA
By
Michael C. Van Milligen
City Manager
MCC IOWA LLC
By
2
AGREEMENT EXTENDING
THE TERM OF THE CABLE FRANCmSE GRANTED TO
MCC IOWA LLC
This Agreement, made this - day of June, 2004, by and between the City of Dubuque,
Iowa, an Iowa municipal corporation (hereinafter the "City"), and MCC Iowa LLC, a
Delaware corporation (hereinafter "Mediacom").
WITNESSETH:
WHEREAS, Mediacom currently holds a cable franchise (the "Franchise") from the
City subject to Ordinance No. 42-81 ("Dubuque Cable Services Franchise"), Resolution No.
110-87, Resolution No. 284-88, Resolution No. 349-94, Resolution No. 521-98, Resolution
No. 445-99, Resolution No. 108-00, and Resolution No. 275-01; and to Ordinance No. 69-93,
all of which documents, as any of them may lawfully be or may have been amended from time
to time, are collectively referred to as the "Franchise Documents"; and
WHEREAS, the parties are currently negotiating the renewal of the Franchise; and
WHEREAS, the parties have agreed that an extension of the current Franchise, in order
to complete negotiations, and to take such other actions as may be appropriate to resolve
renewal issues, is to the benefit of both parties;
WHEREAS, Mediacom has consented to the terms of this extension;
NOW, THEREFORE, in consideration of the promises and undertakings herein, the receipt
and adequacy of which are hereby acknowledged, the parties hereby agree as follows:
Section 1.
The Franchise, which was scheduled to expire on June 30, 2004, is
extended from that date until December 31,2004 (the "extension period").
1
Section 2. During the extension period, and any subsequent extension periods, if any,
all the terms and conditions set forth in the Franchise Documents shall continue in full force
and effect.
Section 3. This extension shall be without prejudice to any rights of either party under
the Cable Communications Policy Act of 1984, as amended. For example, and by way of
illustration and not limitation, any rights Mediacom may have already asserted properly under
47 U.S.C. § 546(a) need not be asserted again, and are not affected by the extension.
Similarly, the extension will not be read to give Mediacom additional rights or opportunities to
trigger the provisions of 47 U.S.C. § 546(a)-(g), or to require the City to reconduct hearings
or other actions properly taken in conjunction with any renewal proceedings under either or
both of the Franchises. No claim that either party may have against the other shall be released
or otherwise affected by this extension.
IN WITNESS WHEREOF, the parties hereto have set their respective hands and seals on the
day first above written.
CITY OF DUBUQUE, IOWA
By
Michael C. Van Milligen
City Manager
MCC IOWA LLC
By
2
D~~~E
~<!k-~
MEMORANDUM
June 2, 2004
TO:
The Honorable Mayor and City Council Members
FROM:
Michael C. Van Milligen, City Manager
SUBJECT: Mediacom Franchise Extension
The actions the City Council has taken recently to spur Mediacom into taking the
negotiations process seriously appear to be working.
The ~ormal Renewal Process is proceeding and Mediacom understands that could end
up in denial of franchise renewal.
The Franchise Fee Payment Analysis to analyze franchise fee payments made by
Mediacom to the City in calendar years 2002 and 2003 is progressing.
The Technical System Audit, which is a technical design and performance review of the
Mediacom system, will include on-site inspections in July.
Informal discussions have been held and Mediacom has announced new services.
Hopefully, Mediacom will continue to make attempts to resolve issues the City has
identified.
Cable Franchise Administrator Merrill Crawford is recommending a six month extension
of the Franchise Agreement to give these processes time to be completed. It is
anticipated that this will be the last requested extension.
I concur with the recommendation and respectfully request Mayor and City Council
approval.
/l/UeJA i;;~ lt1/Þl
Michael C. Van Milligen
MCVM/jh
Attachment
cc: Barry Lindahl, Corporation Counsel
Cindy Steinhauser, Assistant City Manager
Merrill Crawford, Cable Franchise Administrator
1 f3 5 :;¿.
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CITY OF DUBUQUE, IOWA
MEMORANDUM
June 2, 2004
MEMO TO: Michael C. Van Milligen, City Manager
FROM: Merrill CraWford, Cable Franchise Administrator~
SUBJECT: Mediacom Franchise Extension
INTRODUCTION: The purpose of this memorandum is to recommend that the City
Council grant an additional six-month extension of the existing Mediacom cable
franchise and side agreements under the terms currently in effect.
BACKGROUND: At their December 15, 2003 meeting, the City Council adopted
Ordinance No.1 00-03 extending the current cable franchise with MCClowa, LLC
(Mediacom) to June 30, 2004.
On February 16, 2004, the Council authorized the advancement of the Formal
Renewal Process as provided in the 1984 Cable Act, in tandem with the continuation
of informal negotiations. On March 15, the Council approved a contract with Lewis &
Associates of Hollywood, FL to conduct a franchise fee payment analysis and also
authorized the expanded scope of services of the Miller & Van Eaton law firm and
CBG Communications, Inc. to include the component tasks of the Formal Franchise
Renewal Process.
The tasks of the Formal Renewal Process are proceeding as planned:
1. Franchise Fee Payment Analysis - On March 15, 2004, the City Council approved
a contract with Lewis & Associates, of Hollywood, FL to analyze franchise fee
payments made by Mediacom to the City of Dubuque in calendar years 2002 and
2003. The firm has reconciled Mediacom's address database with the City's GIS
address database. A few discrepancies were found and resolved. On May 21, Lewis
received from Mediacom a package of requested supporting data re: the computation
and payment of franchise fees to the City over the two-year studied period. Analysis
is underway, and I expect a further report from Lewis & Associates soon.
2. Technical System Audit - (Note: this is not a financial audit as reported in the
Telegraph Herald in February. It is a technical design and performance review of
Mediacom's Dubuque cable system, measuring compliance with franchise standards,
FCC rules, and other relevant codes.) Mediacom has promised delivery by June 14
of the requested system technical reports, test data and answers to specific
questions posed by CBG Communications. In July, Dick Nielsen of CBG will perform
on-site inspections and tests in Dubuque.
'.
3. RFRP - Attorney Rick Ellrod of the Miller and Van Eaton law firm has begun
preparation of the detailed Request For Renewal Proposal that lies at the core of the
Cable Act's Formal Renewal Process. In the Formal Process, when the very specific
RFRP is presented to the cable operator, the operator has a single opportunity to
respond with a proposal that reasonably meets the community needs as detailed in
the RFRP, taking into account the cost of meeting those needs. That essential
question becomes the focus of a formal administrative hearing an,d likely court
proceedings which eventually determine whether, and under what terms, the cable
franchise is renewed, per federal law.
4. Related Ordinances- Mr. Ellrod will also be working with the City's Legal Services
Department and the franchise renewal negotiating team on the framework of
ordinances needed to enact the provisions of the renewed franchise and otherwise
protect the City's interest in the use of public rights of way for cable and
telecommunications services. '
In the meantime, meetings continue between City and Mediacom negotiators,
attorneys, and technical experts under the informal negotiating process, which both
sides hope will produce a sound agreement.
While specific details of individual negotiating sessions cannot be made public at this
time, I can report progress in most key elements of the City's concems. The tone of
negotiations and level and pace of information exchange have also improved as we
work through very complicated technical and financial issues that surround such
items as the Institutional Network, local community programming, business
infrastructure and services, a lower-priced "broadcast basic" option, and broadcast
signal quality issues. We note that Mediacom's investment and system upgrade
activity in the community continues absent the prospect of a long-term future in
Dubuque that a renewed franchise would assure.
As you know, Mediacom upgraded its Dubuque system from 550 Mhz to 750 Mhz
bandwidth in the Summer and Fall of 2003 to enable the offering of additional video,
voice and data services. This was accomplished, in part, by upgrading electronic
components, re-spacing some amplifiers, and installation of some additional fiber
optic cable in outlying areas.
Mediacom has also been finishing and lighting its long-haul fiber optic network,
connecting the Dubuque headend to other systems in the Tri-states and beyond.
We've begun to see the diverse practical effects of these interconnections, for
example, in Mediacom's preliminary plan to import the KFXA Fox broadcast signal by
fiber to replace the current KFXB signal later this year. We've also noticed that cable
channel override alerts for severe weather or other emergencies now occur
simultaneously in a surrounding cluster of communities as they occur in Dubuque; a
development which carries both advantages and disadvantages, depending upon the
circumstances.
In February, Mediacom doubled the potential download speed of its residential and
cottage business cable modem service, and in mid-May, introduced a mid-speed
(128Kbps) cable modem service priced to compete directly with phone companies'
, .
DSL products and to draw "average" Internet ,users away from traditional dial-up
Internet Access via phone lines.
On May 12, Mediacom introduced its first package of High Definition TV products in
Dubuque and has since added to the HDTV line-up. They have also introduced
Video-On-Demandservices, including digital video recorder devices.
On May 21, Mediacom invited area business representatives to a luncheon meeting
at Dubuque Greyhound Park for a presentation about the variety of voice-data-video
broadband networking options now available in Dubuque and the surrounding area
from their new Enterprise Networks Division. Chris Kohlmann and I attended.
Mediacom announced the inauguration of IP-delivered business services in Dubuque,
including Local Area Networks (LAN), Virtual Private Networks (VPN), dedicated
Internet links, and point-to-point links of custom-configurable capacities and speeds.
They also announced a plan to roll out Voice-Over-IP competitive telephone services
early next year.
If the range of capabilities and pricing of these new broadband services are in
practice as they were described at the presentation, they represent significant
technical and competitive alternatives for Dubuque area businesses needing local
network connections as well as high-capacity fiberoptic links to the outside world.
We do, however, intend to quiz Mediacom further as to certain technical features and
design elements of their new business services, particularly as to reliability,
redundancy, priority attention should a problem occur, and worst case scenario
installation costs if a particular business is not located close to a fiber node.
Meanwhile, as in the past, it is essential to the preservation of current franchise
benefits and the .protection of the interests of the City and cable subscribers that the
current franchise extension not be permitted to expire by default on June 30.
RECOMMENDED ACTION: The Recommended Action is that the City Council set a
public hearing for June 21, 2004 and following that hearing adopt the proposed
ordinance extending Mediacom's present franchise and associated leases to
December 31, 2004,under the same terms as previous extensions and authorizing
the City Manager to execute the Agreement.
cc:
Cindy Steinhauser, Assistant City Manager
Barry Lindahl, Corporation Counsel
Tim O'Brien, Assistant City Attorney
Cable TV Regulatory Commission
Cable Community Teleprogramming Commission