COUNTY OF SAN MATEO

Inter-Departmental Correspondence

Public Works Department

 

DATE:

February 19, 2003

   

BOARD MEETING DATE:

March 11, 2003

 

TO:

Honorable Board of Supervisors

FROM:

Neil R. Cullen, Public Works Director

SUBJECT:

Six Month Time Extension of the Term of Cable Television Franchise Agreements with Comcast Corporation for the Broadmoor, North Fair Oaks, Burlingame Hills, Skyline, King's Mountain, Skylonda and Los Trancos Areas

 

Recommendation

Adopt a resolution authorizing amendments to three Cable Television Franchise Agreements with:

 

1.

Comcast of California IX, Inc. a California corporation - Broadmoor and North Fair Oaks areas;

 

2.

Comcast of California/Illinois, LP, a Colorado limited partnership - Burlingame Hills area; and

 

3.

Comcast of California/Colorado/Florida/Oregon, Inc., a Georgia corporation - Los Trancos, Skylonda, and Skyline/King's Mountain areas;

 

which extends the term of the agreements until September 1, 2003.

 

Previous Board Action

1.

Entered into non-exclusive cable television franchise agreements in the 1980's with several companies serving different unincorporated areas of the County.

 

2.

In the intervening years, approved the transfer of the franchises to various TCI subsidiaries when TCI acquired the companies that held the original franchise agreements.

 

3.

In October 1998, approved the transfer of TCI's cable television franchises to AT&T.

 

4.

In October 1999, authorized amendments to three AT&T cable television franchise agreements extending their term until March 1, 2003.

 

5.

In June 2002, approved the transfer of control of AT&T's cable television franchises to Comcast Corporation.

 

Key Facts

_

Three existing cable television franchise agreements between San Mateo County and Comcast expire on March 1, 2003.

 

_

Extending the terms of the agreements will allow us to have the agreements with Comcast negotiated with the San Mateo County Telecommunications Authority (SAMCAT), which is negotiating new multi-year Master Cable Television Franchise Agreements between Comcast and seven cities.

 

Discussion

Your Board extended the agreements of three of its cable television franchises in 1999 that were due for renewal, in order to join with other SAMCAT members to collectively negotiate a new Master Cable Television Franchise Agreement. The three cable franchise agreements expire on March 1, 2003, but the franchise renewal negotiations were delayed by the merger of AT&T Broadband and Comcast Corporation in January 2002.

 

SAMCAT has retained the firm of Moss and Barnett to negotiate a new cable television franchise agreement with Comcast and SAMCAT is recommending that its members extend the current agreements until September 1, 2003, to allow sufficient time to complete the negotiations. We believe that the County and its cable users will benefit by our negotiating through SAMCAT in that the franchise renewal cost is shared with seven cities and the collective bargaining power is much greater than any one member negotiating on their own.

 

Vision Alignment

We believe our recommendation is consistent with the Shared Commitment to be a "responsive, effective and collaborative government", and goal Number 22, "County and local governments effectively communicate, collaborate and develop strategic approaches to issues affecting the entire County" as an amendment to the various cable franchise agreements enables the County to collaborate with cities to jointly negotiate a new multi-year franchise agreement that best serves our collective cable customers.

 

Fiscal Impact

The cost of negotiating the franchise agreement will be paid for with franchise fees and it is estimated that the County share of the cost will not exceed $20,000. The new Franchise Agreement could provide that Comcast reimburse SAMCAT members for the cost of the Franchise renewal. Franchise fees received by the County from Comcast are set by federal statute and not expected to change during the contract term. Currently they are five percent (5%) of the gross revenue, which generates approximately $116,000 per year. There is no impact to the General Fund.

 

Forms of a resolution and agreements have been approved by County Counsel. The Comcast entities will execute their amendments and return them after your Board has approved the resolution extending the agreements.