HomeMy WebLinkAbout30-City Administrator ORIGINAL
CITY OF SAN BERNARDINO - REQUEST FOR COUNCIL ACTION
From: Lori Sassoon, Assistant Subject: Resolution denying the assignment of a
City Administrator cable television franchise by Adelphia Cablevision
of Inland Empire, LLC to Time Warner NY Cable
Dept: City Administrator's Office LLC, an indirect subsidiary of Time Warner Cable
Date: November 29, 2005 Inc.;and a resolution denying the transfer of control
of the cable television franchise from Adelphia
Communications Corporation to Comcast Cable
Holdings, LLC thereby denying the assignment of
the cable television franchise by Comcast Cable
Holdings, LLC to CAC Exchange I, LLC, and
thereby denying a transfer of control of CAC
Exchange I, LLC from Comcast Corporation to
Time Warner Cable Inc.
Meeting date: December 5, 2005
Synopsis of Previous Council Action:
None.
Recommended motion:
Adopt resolutions
Signature
Contact persons: Lori Sassoon, Michael Reiter Phone:_ 5122
Supporting data attached: Staff Report Ward: All
FUNDING REQUIREMENTS: Amount: none
Source:
Finance:
I�
Council Notes:
Agenda Item No.
i j:� bS
STAFF REPORT
Subject:
Resolutions concerning the denial of franchise transfers related to the sale of Adelphia
Communications to Time Warner Cable
Backiround:
On June 14, 2005, Comcast and Time Warner filed an FCC Form 394 Application with the City of
San Bernardino asking for approval of a transfer of a Cable Television Franchise controlled by
Adelphia Communications through Century-TCI California,L.P.to Time Warner Cable Inc.At the
same time,Time Warner filed an FCC Form 394 Application with the City asking for approval of a
transfer of a Cable Television Franchise controlled by Adelphia Communications Corporation to
Time Warner Cable Inc.
Ultimately, should both transactions meet all the necessary approvals, Time Warner subsidiaries
would control both of the Adelphia franchises. Once a Form 394 is filed, the City has 120 days in
which to approve or deny the franchise transfer. Section 14.08.400 of the San Bernardino Municipal
Code allows the City to review and approve the financial,technical,and legal qualifications of Time
Warner in connection with the proposed assignment of the franchise. If no action is taken, the
franchise transfer is deemed approved by operation of law. Initially, the 1201" day was October 7,
2005.
During that initial 120 day period,the City commissioned an audit of Adelphia's franchise fees and
utility users' tax payments, and the audit results were expected in late October. In September,the
City requested through its outside counsel and consultants an extension of the 120 day period from
Time Warner to allow time for the audit to be completed. On October 3,Time Warner agreed to an
extension to the first Council meeting in December(see attached letter).
At this point, the City and Adelphia/Time Warner representatives are discussing the audit results,
which were received in mid November. A settlement agreement will likely be recommended to the
Mayor and Council in the coming weeks. The City through its outside counsel and consultants has
requested another extension until the first Council meeting in January. However, Adelphia/Time
Warner has not agreed to an extension in writing.
It is recommended that all of the franchisee's obligations be met prior to the transfer of the
Franchise. Since Adelphia has not met its obligations under the existing Franchise,and since Time
Warner has not given its written extension until the first Council meeting in January, it is
recommended that the transfer be denied without prejudice.
Financial Impact:
None by this action. If no action is taken,the franchise transfer requests will be deemed approved by
operation of law. That inaction might impact the City's ability to collect payments due as a result of
audit findings.
Recommendation:
Adopt resolutions
.00T-03-05 11 :20 203 351 2254 P.02 R-340 Job-766
OCT-03-2005 14:29 JC LEGAL 203 351 2254 P.02
2lll Harbor nrivi, Patriela N. McCausland
Nrunifiud„ 07706902 Assistant Chiel Counsel,Regulukpry_
lo(203-328-06M legal
liu 203-3.51.2234
�rirh mccau�lundC�rH�ub1e rom
TIME WARNER
CABLE
VIA Facsimile
909-384-5238
October 3, 2005
Douglas Calkins
City of San Bernardino
300 N. D Street
San Bernardino, CA 92418
Re: Adelphia/Time Warner Transaction: City of San Bernardino
Dear Mr, Calkins:
I am in receipt of Mr. Risk's Ietter of September 22, 2005, proposing an extension of the
time regarding the 120-day transfer application approval time period for San Bernardino
to act on the FCC Form 394 dated June 10, 2005.
Accordingly, without waiving any of their respective rights under federal law, please let
this letter serve as Time Warner's consent to an extension of time under FCC regulations
for San Bernardino to act on the FCC Form 394 for the franchise held by Adelphia
Cablevision of Inland Empire, LLC to the first Council meeting held in December 2005.
We look forward to receiving a draft of the proposed transfer documents. Should you
have any questions,please feel free to contact nie.
Very truly yours,
Time Warner
cc: Kristy.Hennessey—Time Warner Cable
194925
,OCT--- 05 11 :2 0 203 351 2254 P 03 R-340 Job-766
OCT-03-2005 14:29 IC LEGAL 203 371 2254 P.03
1vu Hurbnr Drive PatTieia V McCausland
Slamlard„ CT 069U2 15.ifBtunt Chef Cniuisr f;Pgululary
Tel 203-328-06411 Legal
Fax 203-351-2254
trrshnirrausland@IWCah(c'.cont
TIME WARNER_
CABLE
VIA Facsimile
909-384-5238
October 3, 2005
Douglas Calkins
City of San Bernardino
300 N. D Street
San Bernardino, CA 92418
Re: Adelphia/Time Warner Transaction: City of San Bernardino
Dear Mr. Calkins:
I am in receipt of Mr. Risk's letter of September 22, 2005, proposing an extension of the
time regarding the 120-day transfer application approval time period for Sari Bernardino
to act on the FCC Form 394 dated June 10, 2005.
Accordingly, without waiving any of their respective rights under federal law,please let
this letter serve as Time Warner's consent to an extension of time under FCC regulations
for San Bernardino to act on the FCC l orin 394 for the franchise held by Adelphia
Communications Corporation to the first Council meeting held in December 2005.
We look forward to receiving a draft of the proposed transfer documents. Should you
have any questions, please feel free to contact me,
Very truly yours,
Time Warner
cc: Kristy Hennessey—Time Warner Cable
194925
I RESOLUTION NO. C (OPY
2 RESOLUTION OF THE MAYOR AND COMMON COUNCIL OF THE CITY OF
SAN BERNARDINO DENYING THE TRANSFER OF CONTROL OF THE CABLE
3 TELEVISION FRANCHISE FROM ADELPHIA COMMUNICATIONS CORPORATION
TO COMCAST CABLE HOLDINGS, LLC THEREBY DENYING THE ASSIGNMENT OF
4 THE CABLE TELEVISION FRANCHISE BY COMCAST CABLE HOLDINGS, LLC TO
CAC EXCHANGE I, LLC; AND THEREBY DENYING A TRANSFER OF CONTROL OF
5 CAC EXCHANGE I, LLC FROM COMCAST CORPORATION TO TIME WARNER
CABLE INC.
6
WHEREAS, Century-TCI California, L.P. ("Franchisee") is the authorized holder of a
7
franchise ("Franchise") that authorizes the construction, operation, and maintenance of a cable
8
television system within the City of San Bernardino ("Franchise Authority");
9
WHEREAS,on April 20, 2005, Comcast Corporation("Comcast")and Time Warner NY
10
Cable LLC ("TWNY"), an indirect subsidiary of Time Warner Cable Inc., each entered into
11
12 separate definitive agreements to acquire, collectively, substantially all of the assets of Adelphia
Communications Corporation ("Adelphia");
13
14 WHEREAS, in accordance with the provisions of an Exchange Agreement that was also
15 executed on April 20, 2005, Comcast, Time Warner Cable Inc., and their respective subsidiaries
16 agreed upon consummation of the asset purchase agreements referenced above,to exchange certain
17 cable systems including the Century-TCI California, L.P. franchised cable system serving the
City;
18
19 WHEREAS, on June 14, 2005, the Franchise Authority received two applications related
20 to proposed transfers of control of the existing Franchise held by Century-TCI California,L.P. Each
21 application included a FCC Form 394 titled "Application for Franchise Authority Consent to
22 Assignment or Transfer of Control of Cable Television Franchise." Supplemental information was
23 provided to the Franchise Authority by Time Warner Cable Inc. and Comcast Corporation on July
25, 2005;
24
25 WHEREAS, on October 3,2005,Time Warner gave written consent to extend the time for
26 the City to act on the Form 394 application until the first council meeting in December;
27 WHEREAS,in accordance with Section 14.08.400 of the San Bernardino Municipal Code,
28 the Franchise Authority has the right to review and to approve the financial, technical, and legal
MR:ar[F:\REITER\Municipa]\Cable\Franchise Transfer\Comcasr Transfer Deniallwpd] I
I RESOLUTION OF THE MAYOR AND COMMON COUNCIL OF THE CITY OF
SAN BERNARDINO DENYING THE TRANSFER OF CONTROL OF THE CABLE
2 TELEVISION FRANCHISE FROM ADELPHIA COMMUNICATIONS CORPORATION
TO COMCAST CABLE HOLDINGS,LLC THEREBY DENYING THE ASSIGNMENT OF
3 THE CABLE TELEVISION FRANCHISE BY COMCAST CABLE HOLDINGS, LLC TO
CAC EXCHANGE I, LLC; AND THEREBY DENYING A TRANSFER OF CONTROL OF
4 CAC EXCHANGE I, LLC FROM COMCAST CORPORATION TO TIME WARNER
CABLE INC.
5
6 qualifications of the ultimate Transferee in connection with the proposed transfers of control of
the Franchisee and the proposed assignment of the Franchise; and
7
8 WHEREAS, the staff of the Franchise Authority has reviewed the documentation that
9 accompanied the FCC Forms 394 and additional information provided by the applicants, and has
10 concluded that the proposed ultimate Transferee does not have the requisite financial, technical,
11 and legal qualifications to adequately perform, or to ensure the performance of, all obligations
required of the Franchisee under the Franchise:
12
NOW THEREFORE, BE IT RESOLVED BY THE MAYOR AND COMMON
13
COUNCIL OF THE CITY OF SAN BERNARDINO AS FOLLOWS:
14
15 SECTION 1. In accordance with Section 14.08.400 of the San Bernardino Municipal
16 Code, the Franchise Authority denies consent to, and disapproves of, the proposed interim
17 assignment of the Franchise, and denies the proposed ultimate transfers of control of the Franchise
without prejudice.
18
19
20
21
22
23
24
25
26
27
28
MR:ar[F:\REITER\Municipal\Cable\Franchise Transfer\Comcast Transfer Denia12.wpd] 2
I RESOLUTION OF THE MAYOR AND COMMON COUNCIL OF THE CITY OF
SAN BERNARDINO DENYING THE TRANSFER OF CONTROL OF THE CABLE
2 TELEVISION FRANCHISE FROM ADELPHIA COMMUNICATIONS CORPORATION
TO COMCAST CABLE HOLDINGS,LLC THEREBY DENYING THE ASSIGNMENT OF
3 THE CABLE TELEVISION FRANCHISE BY COMCAST CABLE HOLDINGS, LLC TO
CAC EXCHANGE I, LLC; AND THEREBY DENYING A TRANSFER OF CONTROL OF
4 CAC EXCHANGE I, LLC FROM COMCAST CORPORATION TO TIME WARNER
CABLE INC.
5
6 I HEREBY CERTIFY that the foregoing Resolution was duly adopted by the Mayor and
7 Common Council of the City of San Bernardino at a meeting
8 thereof, held on the day of , 2005, by the following vote, to wit:
COUNCIL MEMBERS: AYES NAYS ABSTAIN ABSRNT
9
10 ESTRADA
LONGVILLE
11
MCGINNIS
12
DERRY
13
14 KELLEY
JOHNSON
15
MCCAMMACK
16
17
CITY CLERK
18
19
20 The foregoing Resolution is hereby approved this day of , 2005.
21
22 JUDITH VALLES, Mayor
23 City of San Bernardino
Approved as to form and
24 legal content:
25
By:
26 JAMES PENMAN
City Attorney
27
28
MR:ar[F:\REITER\Municipal\Cable\Franchise Transfer\Comcwt Transfer Deniallwpdi 3
I RESOLUTION NO.
2 RESOLUTION OF THE MAYOR AND COMMON COUNCIL OF THE CITY OF
SAN BERNARDINO DENYING THE ASSIGNMENT OF A CABLE TELEVISION
3 FRANCHISE BY ADELPHIA CABLEVISION OF INLAND EMPIRE, LLC TO TIME
WARNER NY CABLE LLC, AN INDIRECT SUBSIDIARY OF TIME WARNER CABLE
4 INC.
5 WHEREAS, Adelphia Cablevision of Inland Empire, LLC ("Franchisee") is the
6 authorized holder of a franchise ("Franchise") that authorizes the construction, operation, and
7 maintenance of a cable television system within the City of San Bernardino ("Franchise
Authority");
8
9 WHEREAS,on April 20, 2005, Comcast Corporation("Comcast")and Time Warner NY
10 Cable LLC ("TWNY"), an indirect subsidiary of Time Warner Cable Inc., each entered into
separate definitive agreements to acquire, collectively, substantially all of the assets of Adelphia
11
12 Communications Corporation ("Adelphia");
13 WHEREAS,on June 14, 2005, the Franchise Authority received from the Franchisee and
14 from Time Warner NY Cable LLC ("Transferee"), an application for the assignment of the
15 existing Franchise. This application included FCC Form 394 titled "Application for Franchise
16 Authority Consent to Assignment or Transfer of Control of Cable Television Franchise."
17 Supplemental information was provided to the Franchise Authority by the Transferee on July 22,
2005;
18
19 WHEREAS,on October 3,2005,Time Warner gave written consent to extend the time for
20 the City to act on the Form 394 application until the first council meeting in December;
21 WHEREAS,in accordance with Section 14.08.400 of the San Bernardino Municipal Code,
22 the Franchise Authority has the right to review and to approve the financial, technical, and legal
23 qualifications of the Transferee in connection with the proposed assignment of the Franchise; and
24 WHEREAS, The staff of the Franchise Authority has reviewed the documentation that
25 accompanied the FCC Form 394 and additional information provided by the applicant, and has
26 concluded that the proposed Transferee does not have the requisite financial, technical, and legal
27 qualifications to adequately perform, or to ensure the performance of, all obligations required of
the Franchisee under the Franchise:
28
M R:ar[F:\REITER\Municipal\Cable\Franchise Transfer\Time Wamer Denia12 wpd] 1
I RESOLUTION OF THE MAYOR AND COMMON COUNCIL OF THE CITY OF
SAN BERNARDINO DENYING THE ASSIGNMENT OF A CABLE TELEVISION
2 FRANCHISE BY ADELPHIA CABLEVISION OF INLAND EMPIRE, LLC TO TIME
WARNER NY CABLE LLC, AN INDIRECT SUBSIDIARY OF TIME WARNER CABLE
3 INC.
4 NOW THEREFORE, BE IT RESOLVED BY THE MAYOR AND COMMON
5 COUNCIL OF THE CITY OF SAN BERNARDINO AS FOLLOWS:
6 SECTION 1. In accordance with Section 14.08.400 of the San Bernardino Municipal
7 Code, the Franchise Authority denies consent to, and disapproves of, the proposed assignment of
8 the Franchise without prejudice.
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
MR:ar[F:\REITER\Municipa]\Cable\Franchise Transfer\Time Warner Deniallwpd] 2
I RESOLUTION OF THE MAYOR AND COMMON COUNCIL OF THE CITY OF
SAN BERNARDINO DENYING THE ASSIGNMENT OF A CABLE TELEVISION
2 FRANCHISE BY ADELPHIA CABLEVISION OF INLAND EMPIRE, LLC TO TIME
WARNER NY CABLE LLC, AN INDIRECT SUBSIDIARY OF TIME WARNER CABLE
3 INC.
4 I HEREBY CERTIFY that the foregoing Resolution was duly adopted by the Mayor and
5 Common Council of the City of San Bernardino at a meeting
6 thereof, held on the day of , 2005, by the following vote, to wit:
7 COUNCIL MEMBERS: AYES NAYS ABSTAIN ABSENT
8 ESTRADA
9 LONGVILLE
10 MCGINNIS
11 DERRY
12 KELLEY
13 JOHNSON
14 MCCAMMACK
15
16
CITY CLERK
17
18
19 The foregoing Resolution is hereby approved this day of , 2005.
20
21 JUDITH VALLES, Mayor
22 City of San Bernardino
Approved as to form and
23 legal content:
24
25 By: -
JAMES F. PENMAN
26 City Attorney
27
28
MR:ar[F:\REITER\Municipal\Cable\Franchise Transfer\Time Warner Deniallwpd] 3