AGENDA #4e
MEMORANDUM
TO: Mayor and Town Council
FROM: W. Calvin Horton, Town Manager
SUBJECT: Resolution to Increase Cablevision Public Access Fees by the Amount of the Inflation Factor
DATE: November 26, 2001
The attached resolution would increase the cablevision public access fee from 69 to 70 cents based on the inflation factor.
INTRODUCTION
On November 12, the Council held a public forum to receive citizen comments on the potential adjustment of public access fees charged to cable television customers. Two citizens spoke in support of increasing the public access fees to provide more funding for operations of The Peoples Channel, Inc.
The public access rate may be:
· adjusted for inflation to 70 cents per month;
· continued at the present rate of 69 cents per month;
· reduced; or
· eliminated.
“Public access” refers to non-commercial programming produced or submitted by citizens to be carried on the cable system. Public access fees are fees assessed on subscribers’ monthly bills, collected by Time Warner Cable, and transferred to the Town. The Town then pays the non-profit organization, The Peoples Channel, Inc., to provide public access television services.
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, to 67 cents on November 25, 1998, to 68 cents on November 22, 1999, and to 69 cents on December 11, 2000.
The Council authorized a performance agreement in February 1998 with The Peoples Channel, Inc. The Peoples Channel has been providing public access television services since July 1, 1998. At the April 9, 2001 meeting, the Council authorized the Manager to negotiate a renewed performance agreement with the channel. The renewed agreement was made effective July 5, 2001. The Peoples Channel, Inc. submitted its annual report to the Council at the April 9, 2001 meeting (Attachment 1).
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 69-cent per month public access fee generated about $100,317 for the fiscal year ended June 30, 2001.
Each year, the Council decides whether to increase, maintain, or reduce the public access fee.
General Comments:
The franchise allows the Town to reduce, eliminate, or increase the public access fee once per year. The increase in a given year is limited to an inflation factor or 3%, 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, for the previous 12-month fiscal period. The most recently-published 12-month inflation figure is 2.2%.
A fee adjustment would take effect on January 1, 2002.
Options:
1. Direct Time Warner to increase the fee by the amount of the inflation factor.
The franchise states that the annual adjustment will be the amount of increase in the Gross National Product Price Index (GNP-PI), subject to a limit of 3% increase per year and subject to an overall limit of $1 per month as the maximum future fee.
The GNP-PI inflation factor increased 2.2% from July 2000 to June 2001. A 2.2% change would result in an increase from 69 cents to 70 cents per month, beginning January 1, 2002, which we believe is a reasonable increase. The increase would generate approximately $101,771, or an additional $1,454 in 2002.
2. Make no change in the current fee.
3. Reduce or eliminate the public access fee.
That the Council adopt the attached resolution, increasing the public access fee from 69 to 70 cents based on the inflation factor, effective January 1, 2002.
1. Memorandum dated April 9, 2001, Summary of Peoples Channel 2000 Report (p. 5).
A RESOLUTION ADOPTING AN INFLATION ADJUSTMENT TO THE PUBLIC ACCESS FEE BILLED TO CABLE TELEVISION CUSTOMERS IN CHAPEL HILL (2001-11-26/R-4)
WHEREAS, on November 12, 2001, the Town Council held a public forum on whether to increase the cablevision public access fee; and
WHEREAS, a one-cent increase in the public access fee would generate about $1,454 in additional annual funds;
NOW, THEREFORE, BE IT RESOLVED by the Council of the Town of Chapel Hill that the Council hereby increases the public access fees from 69 to 70 cents per month, beginning January 1, 2001.
This the 26th day of November, 2001.
ATTACHMENT 1
AGENDA #5c
TO: Mayor and Town Council Members
FROM: W. Calvin Horton, Town Manager
SUBJECT: Summary of The Peoples Channel 2000 Annual Report
DATE: April 9, 2001
The purpose of this memorandum is to present summary information from The Peoples Channel’s Annual Report. Mr. Robert Gwyn, President and Chair of The Peoples Channel Board of Directors, will present the report.
The Peoples Channel has submitted its Annual Report to the Town of Chapel Hill for Calendar Year 2000. The Peoples Channel is a non-profit corporation organized by area citizens to provide community access television in Chapel Hill. The Channel is a tax-exempt, non-profit 501(c)(3) corporation.
I. Facilities & Services
A. Governance. The Peoples Channel is governed by a Board of Directors whose members serve without compensation. Under provision of its bylaws, members of the Board of Directors are selected by approval of the Board of Directors at any meeting of the Board. A list of Board members is included as Appendix A.
B. Staffing. There are currently two (2) full-time positions and one (1) part-time position.
C. Programming and Scheduling. During 2000, The Peoples Channel aired 26 locally-produced series (five more than last year) and 45 locally-produced one-time programs. During the January 2000 snowstorm, the Channel experimented with live and call-in programs. The Channel also cablecast 367.25 hours of original locally-produced programming for an average of 7 hours of local programming each week.
II. Funding and Development
A. Funding and Other Contributions
1. The Peoples Channel receives funding from several sources, primarily “pass-through” fees collected by Time Warner from cable customers under the Franchise Agreement. The cable television franchise approved by the Council and accepted by Time Warner in July 1996 allows the Town to have cable customers billed a public access fee. On December 11, 2000, the Council approved an increase in the monthly subscriber pass-through fee from 68 cents to 69 cents, based on inflation. Under the Performance Agreement with The Peoples Channel, the Town pays The Peoples Channel these public access fees, which are collected by Time Warner in customer bills.
2. The Peoples Channel had a reduction in fund balance in the amount of $13,991 for Calendar Year 2000. During the year, expenses included one-time video equipment purchases totaling $17,376, triggering the revenue/expense imbalance reflected below. Channel representatives say that they expect income and expenses to balance in the future. The Channel’s books have been audited through June 30, 2000. The numbers listed below have not been audited to the extent that they represent transactions after that date.
|
Funding Source |
2000 Revenue |
|
Co Contractual (Pass-Through Cable Fees) |
$ $ 93,057 |
|
Su Sub-Lease of Office Space |
$ $ 6,264 |
|
Fe Fees from Orange County |
$ $ 19,000 |
|
Ta Tape sales/video dubbing |
$ $ 2,556 |
|
Int Interest |
$ $ 2,017 |
|
Re Rental of equipment & studio space |
$ $ 120 |
|
Re Restricted Contributions |
$ $ 600 |
|
Un Unrestricted Contributions |
$ $ 390 |
|
To Total |
$1 $124,004 |
|
Expense Item |
2000 Expense Amount |
|
Pa Payroll |
$ $ 55,798 |
|
Re Rent |
$ $ 33,719 |
|
Vi Video Equipment and Tapes |
$ $ 20,740 |
|
U Utilities |
$ $ 5,662 |
|
Co Contract Services |
$ $ 6,029 |
|
Of Office Supplies and Equipment |
$ $ 3,470 |
|
Ins Insurance |
$ $ 2,915 |
|
Pr Professional Fees |
$ $ 2,050 |
|
M Miscellaneous Expenses |
$ $ 7,612 |
|
To Total |
$1 $ 37,995 |
B. Other Contracts and Performance Agreements
1. The Peoples Channel has negotiated with other communities for service:
(a) Orange County Board of Commissioners. In 2000, the Channel entered into a contract with Orange County to tape and cablecast Board meetings. The Channel used private funds and purchased equipment for a mobile field studio. Volunteers installed studio lighting at the Southern Human Services Center in Chapel Hill, where many of the meetings are held.
(b) Presentations to other franchise authorities. The Channel has been in contact with the Carrboro Board of Aldermen and hopes to enter negotiations soon.
IV. Future Directions
A. Equipment. The Peoples Channel has developed a schedule for long-term replacement of equipment and is investigating new systems for recording video and audio on the computer. The Channel is also researching software that can integrate program scheduling, equipment checkout, and other parts of technical operation.
B. Community outreach. With the addition of an outreach coordinator to the staff, the Channel is pursuing a program of contacting community groups, non-profits, and schools to provide information about their potential involvement with The Peoples Channel.
C. Performance Agreement renewal with the Town of Chapel Hill. The Channel’s directors have contacted the Manager’s Office regarding renewal of the performance agreement. An agenda item in tonight’s packet would authorize the Manager to negotiate a new performance agreement with the Town.
D. Proposed Performance Agreements with other Franchising Authorities. The Peoples Channel is currently working to secure performance agreements with Orange County, Carrboro, Hillsborough, and Chatham County, which are also in discussions with Time Warner for their franchise renewals.
That the Council receive the attached Annual Report.