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City Council Regular Meeting Minutes November 10, 2015 Page 3 1 and filed the staff report and directed NSCC staff to negotiate a cable telephone franchise with 2 CenturyLink. The NSCC adopted a Findings of Fact that recommended approval of the 3 negotiated cable television franchise with CenturyLink by each member city. The CenturyLink 4 Cable Television Franchise is now before the City Council for consideration. 6 In reviewing the CenturyLink cable franchise, there are two primary issues to consider. The first 7 is whether federal law preempts Minnesota's 5 -Year Build Statute. Minnesota Statutes Section 8 238.084, subdivision 1(m), requires all initial franchises to have a provision that requires a cable 9 operator build out its cable system at a rate of 50 plant miles per year and that its cable system be 10 substantially complete within 5 years. CenturyLink claims that this 5 -Year Build Statute is an 11 unlawful barrier to entry and is preempted by federal law and an FCC decision referred to as the 12 621 Order. 13 14 The second issue is whether the CenturyLink franchise contains a reasonable build -out schedule. 15 The franchise ordinance recognizes that CenturyLink has already constructed a legacy 16 communications system throughout the City, which is capable of providing telephone and 17 internet service. The build -out provisions in the franchise are related to upgrades of the legacy 18 system to make it capable of providing cable service to all area residents. A description of how 19 the CenturyLink Franchise addresses build -out was provided to Council. 20 21 Mr. Bradley reviewed a PowerPoint presentation summarizing the Ordinance requested. The 22 franchise fees are the same for Comcast and CenturyLink. CenturyLink is providing 16 access 23 channels and Comcast provides 9 access channels. CenturyLink will provide all channels in HD. 24 CenturyLink will provide electronic programming guide. Channel placement will be slightly 25 different. In St. Anthony, they will be on Channel 15. CenturyLink will include public service 26 announcements and video on- demand. CenturyLink will construct an interconnection network. 27 The network will allow PEG Centers throughout the Twin Cities to share live programming. 28 Complimentary broadband will be provided to one location within each member city. 29 30 Mr. Bradley stated the agreement is similar to the Comcast franchise agreement and outlined the 31 differences. 32 33 Councilmember Stille asked what happens if the market share traction is not obtained as 34 anticipated. Mr. Bradley stated that would be addressed in the next franchise agreement after the 35 5 -year term. 36 37 Councilmember Gray, who is a member of the NSCC, stated the positive thing about this is for 38 the first time there will be real competition for the wire -based services. Right now, there is very 39 little competition for high -speed broadband. Councilmember Gray felt it will be a good deal for 40 the City to get this type of competition and with the fees the same, everything is on equal 41 footing. 42 43 Mayor Faust stated there have already been recent changes in the marketplace with Comcast. 44 The competition is already taking effect even if someone doesn't have CenturyLink. 45 46 Mr. Tyler Middleton, CenturyLink Vice President of Operations for the State of Minnesota, 47 stated CenturyLink has been preparing for over a year to bring prism television to this