10-09-1985 Council Agenda - Laserfiche WebLink

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Memo -North Suburban September 16, 1985 Page Two actively disapprove the proposed rate increase within the ninety (90) day period, the rate becomes effective upon the date specified in the notice from Group W. The city cannot unreasonably disapprove any rate increase. On August 22, 1985 Group W gave written notice of a proposed rate increase. The effective date of the rate increase is November 22, 1985, unless disapproved by a member city. After much discussion and review of the proposed rate increase, the Commission chose to take no action in disapproving the proposed increase. Additionally, the Commission recommends to its member cities that no affir- mative action be taken to disapprove the $2.00 Basic Rate increase. The effect of this decision is to allow the proposed rate increase under the passive rate review procedure outlined above. New Federal legislation permits cable companies to increase Basic Service Rates by 5% each year without any city approval. Additionally, new Federal legislation takes away from cities all rate regulation authority as of December 29, 1986. Faced with the inevitability of com- plete deregulation in a year and three months, the Commission recommends to its member cities that they not incur the effort and expense of a rate hearing for the $2.00 Basic Rate increase. In conjunction with the proposed rate change, Group W requested permission to implement the Basic Service rate in- crease effective immediately. The franchise ordinance re- quires the effective date of the rate increase to be after the ninety (90) day notice period. Group W's rate increase would be effective November 22, 1985. Group W stated that with the beginning of the Fall marketing season, it was important to increase rates immedi- ately rather than halfway through their marketing campaign. The Commission agreed with this reasoning. Consequently, the Commission recommends to its member cities the passage of a resolution to permit the immediate implementation of the proposed rate increase. The Commission recommends that the resolution provide that the cities will not penalize Group W for raising the Basic Rate to $9.95 prior to November 22, 1985, the proposed effective date of the $2.00 increase.