3.b. SWCSR 04-06-2017 MEMORANDUM
TO: Sherburne-Wright Counties Cable Commission
FROM: Bob Vose
DATE: April, 2017
RE: Franchise Renewal
Overview
To preserve significant renewal rights under the federal Cable Act, a cable operator must request
renewal in writing 36-30 months prior to expiration. The franchise(s) expire in early 2020.
Charter has given notice to some member cities (at least Buffalo and Maple Lake).
In renewal, the franchising authority it to: a) identify future cable-related community needs and
interests, and b)review the operator's past performance and franchise compliance. There is no
time limit for completion, but the process must be initiated within six (6) months from the
renewal request. The parties can also agree to proceed via informal negotiations.
The Cable Act does not indicate how a franchising authority is to identify future needs or review
past performance. Public hearings, financial or technical audits, or citizen surveys are often
conducted. Consultants are often retained. Costs often exceed $50,000 and can be higher.
Once needs are identified and past compliance reviewed, the franchising authority may establish
a deadline for submission of a formal proposal including services, facilities and equipment to
meet identified needs. Upon submission, the franchising authority must provide prompt public
notice of the proposal and must renew or preliminarily deny within four(4) months of receipt.
If the proposal is preliminarily denied, the operator can request administrative proceedings or the
franchising authority may initiate them to consider: 1) whether the operator has substantially
complied with the material terms of the franchise and law; 2) whether the quality of service,
response to consumer complaints, and billing practices have been reasonable in light of
community needs; 3) whether the cable operator has the financial, legal and technical ability to
provide what's been proposed, and; 4) whether the proposal is reasonable to meet the future
cable-related community needs and interests,taking into account the cost thereof. The operator
must be given notice and opportunity for participation, including the right to introduce evidence,
require production of evidence and question witnesses. A transcript must be made.
Upon completion, the ALJ will typically produce recommended findings. The franchising
authority then must renew or issue a written decision stating the reasons for denial.
Last Time
The franchises were last renewed in 2004 via informal negotiations. I was retained after several
years of fruitless negotiation. The Commission did not hire outside consultants or produce a
RJV-254155v1 1
SH255-1
"needs assessment." Rather, the Commission (largely Bill Bruce) prepared a 5-year capital plan
which was useful in finalizing negotiations. A franchise and PEG fee audit was also conducted.
Primary concerns were the results of the audit and other franchise compliance problems and
future PEG funding. In the current renewal, concerns would also include the need for HD
capacity, the "free" service and converter box issues, and the continuing potential for
competition.
Conclusion
The Commission will want to consider:
1) Whether to agree to the informal process at the outset.
2) How to complete a past-performance and compliance review, and whether to
retain any consultants to, for example, provide a needs assessment.
3) At minimum, producing another 5 or 10-year PEG capital/equipment plan and
creating a Commission committee for reviewing past performance. The
Commission should also confirm that it will be responsible for conducting any
public hearings to obtain community input and for negotiations.
RJV-254155v1 2
SH255-1