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:             December 9, 2002

 

 

The attached resolution would increase the cablevision public access fee from 70 to 71 cents based on the inflation factor.

 

INTRODUCTION

 

On November 25, 2002, the Town Council held a public forum to receive comments on the potential adjustment of the public access fee charged to cable television customers.  The public access fee rate may be:

 

• adjusted for inflation to 71 cents per month;
• continued at the present rate of 70 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.

 

At the forum, two citizens spoke in favor of the public access services offered by The Peoples Channel. 

 

BACKGROUND AND DISCUSSION

 

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.

 

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 July 2001.  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 70-cent per month public access fee generated $105,455 for the fiscal year ended June 30, 2002.

 

Each year, the Council decides whether to increase, maintain, or reduce the public access fee. The franchise allows the Town to reduce, eliminate, or increase the public access fee once per year. The increase 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.  According to the Federal Communications Commission, this figure was 1.15%. A 1.15% change would result in an increase in the fee from 70 cents to 71 cents per customer per month, beginning January 1, 2003.  With the increase, we estimate that revenue would be approximately $107,000, or an additional $1,500.

 

RECOMMENDATION

 

We recommend that the Council adopt the attached resolution, which would increase the public access fee to 71 cents per month, effective January 1, 2003.

 

 

A RESOLUTION ADOPTING AN INFLATION ADJUSTMENT TO THE PUBLIC ACCESS FEE BILLED TO CABLE TELEVISION CUSTOMERS IN CHAPEL HILL (2002-12-09/R-6)

 

WHEREAS, on November 25, 2002, 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 $1,500 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 70 to 71 cents per month, beginning January 1, 2003.

 

This the 9^th day of December, 2002.