1996-124 Council Resolution - Laserfiche WebLink

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6. The League of Minnesota Cities has told us that US West has sued a city in Minnesota over the use of rights-of-way. Why would we want to cooperate with US West in this transfer? It is true that US West has an ongoing dispute with Minnesota cities over ordinances which attempt to control use of rights-of-way. That dispute is not related to this transfer, except for the fact that it is the same company involved in the dispute. The simple answer is that the law requires that you must consent to the transfer unless you have a reasonable basis to deny, based on the limited standards of review -- the legal, technical and financial characteristics of the purchaser. YOU MAY NOT DENY THE TRANSFER SIMPLY BECAUSE YOU DO NOT LIKE US WEST. 7. What are these corporate guaranties, and why are we requiring them? During the analysis, the complicated corporate structure proposed by both companies caused the commissions to be concerned about which entity could be turned to if a catastrophic problem arose with the local system. Therefore, we determined it to be in the best interest of the cities that the assets of the parent corporations be pledged to support the local systems. This is an extraordinary remedy, and not often secured. However, the commission has received from both parent companies a pledge that they will give such guaranties, and your resolution will not be effective until such guarantees are received. 8. If we are in the process of renewing our franchises, won't this slow us down? Certainly the dynamics of the renewal processes have been changed. However, the companies have assured the commissions that the local management will remain responsible for negotiating renewals, and they will be authorized to enter into all necessary agreements. US West, if they receive the FCC waiver, will have to divest themselves of the systems within 18 months. There has been some concern about US West's desire to enter into long term commitments with systems they will not own. This is a legitimate concern. Should the commission determine that they new company is not negotiating in good faith, remedies such as denying the renewal or extending the franchise until the new owner is in place are all available to the cities. 9. Will our existing cable franchise remain intact? Yes. The company holding the local franchise will not be changed because the transfers are occurring farther up the "corporate ladder". Any transfer of ownership requires that the purchasing company agree to comply with all existing franchises, as amended, and any other agreements which the current owner has with the cities and commissions. TDC/rs C: \CABLE\MEREDITH\SUMMARY