AGENDA #4b

MEMORANDUM

TO:                  Roger L. Stancil, Town Manager

FROM:            Catherine Lazorko, Town Information Officer

SUBJECT:      Scheduling a Public Forum to Consider a Potential Change in Cablevision Public Access Fees Paid by Cable Television Customers

DATE:            November 6, 2006

Adoption of the attached resolution would schedule a public forum for November 20 on a potential change in the public access fees paid by cablevision customers. 

“Public access” refers to non-commercial programming produced or submitted by citizens to be carried on the cable system.

BACKGROUND

The cable television franchise, approved by the Council and accepted by Time Warner Cable in July 1996, allows the Town to have cable customers billed for a public access fee.

The Town began charging a public access fee of 65 cents under a resolution adopted by the Council on November 11, 1996, and amended that amount to:

• 66 cents on November 13, 1997
• 67 cents on November 25, 1998
• 68 cents on November 22, 1999
• 69 cents on December 11, 2000
• 70 cents on November 26, 2001
• 71 cents on December 9, 2002
• 72 cents on November 10, 2003
• 74 cents on November 22, 2004
• 76 cents on November 21, 2005

Public access fees collected by Time Warner Cable on behalf of the Town go to The Peoples Channel to provide public access television services.  The Council authorized renewal of the performance agreement with The Peoples Channel in June 2004.  The Peoples Channel is expected to submit its annual report to the Council at the November 20, 2006 meeting.

The purpose of the public access fee is to help cover wages, equipment, rent and other costs for management and operation of public access cable television services.  The current 76-cent per month public access fee generated $120,507 for the fiscal year that ended June 30, 2006.

Each year, the Council decides whether to increase, maintain, or reduce the public access fee.

OPTIONS

The franchise allows the Town to reduce, eliminate, or increase the public access fee once per year to an overall limit of $1 per month as the maximum future fee. The increase in a given year is limited to an inflation factor or 3 percent, whichever is less. The inflation factor is the increase in the most recent Gross National Product-Price Index (GNP-PI) published by the U.S. Department of Commerce, Bureau of Economic Analysis.  According to the Federal Communications Commission, the inflation factor for the previous 12-month fiscal period is 3.3 percent.

Substantive Options:

• Direct Time Warner to increase the fee by the amount of the inflation factor, which would result in an increase from 76 cents to 78 cents per customer per month, beginning January 1, 2007.  The increase would raise an additional $3,615.

• Make no change in the current fee.

• Reduce or eliminate the public access fee.

Procedural Options:

Call a public forum for November 20.

Take no further action and leave the fee at its present level of 76 cents per month.

RECOMMENDATION

That the Council adopt the attached resolution and refer this matter to the Manager for recommendations and call a public forum for November 20.