Agenda Packets - 2014/07/14 - Laserfiche WebLink

Home Browse Search

Mounds View City Council June 9, 2014 Regular Meeting Page 6 1 Mayor Flaherty questioned why Comcast was proposing 44 cents in PEG fees when Minneapolis 2 and Woodbury received over one dollar in PEG fees. Mr. Logan stated this was the offer being 3 made within the formal cable franchise. He noted the PEG fees continue to be discussed 4 informally. 5 6 Council Member Mueller saw the benefits of the monthly PEG fees from the local channels. She 7 questioned what benefit the residents would gain through the proposed connection fees 8 ($3,350/month). Mr. Logan stated all libraries and schools would continue to receive a free draw 9 from Comcast. He indicated Comcast owns this network and has invested $1.6 billion in the 10 metro area. He reported that Federal law does not require Comcast to maintain the network and 11 therefore Comcast was proposing to charge the member cities a fee for connectivity to assist with 12 the future maintenance of the network. 13 14 Council Member Mueller explained she was not a part of the negotiations 10 years ago with 15 Comcast. She questioned why the member cities would be charged connectivity fees when they 16 had provided Comcast with right-of-way for the installation of the network. Mr. Logan stated the 17 5% franchise fee compensated the member cities for use of the right-of-way. 18 19 Council Member Mueller commented that Comcast was requesting $1,675.80 per capita to 20 operate its services in the City of Mounds View. She reported she had a very difficult time 21 comprehending why the City would be charged a connectivity fee, when right-of-ways were 22 offered to Comcast, and for this reason she could not support the proposed cable franchise. 23 24 Council Member Meehlhause understood that Comcast customers assisted in paying for the 25 network. He indicated the Cities also contributed to the upgrades of the I-Net. He questioned 26 why Comcast was proposing to charge back connectivity fees to member cities. Mr. Logan 27 stated ultimately, the network belonged to Comcast and while customers assisted indirectly with 28 paying for the investments, the system was wholly owned and operated by Comcast. 29 30 Council Member Meehlhause reported franchise and PEG fees were not paid out by Comcast, but 31 rather, were pass through fees that did not impact Comcast’s bottom line. Mr. Logan explained 32 that franchise fees were impacting Comcast as it was making the company less competitive with 33 satellite vendors. 34 35 Council Member Meehlhause reviewed how funds had been used by CTV in the previous year 36 and questioned Comcast’s income in 2013. Mr. Logan stated he could not speak to this. 37 38 Council Member Meehlhause indicated Comcast generated $64.7 billion in revenue in 2013 and 39 had a cash flow of $8.5 billion. For this reason, he believed that Comcast could afford to be 40 publicly service conscience in the proposed cable franchise with Mounds View and its member 41 cities. 42 43 Council Member Hull questioned why the PEG fees were agreed to 10 years ago. Mr. Logan 44 commented that the PEG fees have increased over the past 10 years. Ms. Wilson stated in 2001 45