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HomeMy WebLinkAboutMINUTES - 06082004 - C.133 TO: BARD OF SUPERVISORSCONTRA *.•' , _ .• _ • FROM. John Sweeten, County COSTA AdministratorCOUNTY fIL + - r• DATE: May 19, 2004 SUBJECT: Disbursement of Claims for Ponderosa Cable System 33 SPECIFIC REQUEST(S)OR RECOMMENDATION(S)&BACKGROUND AND JUSTIFICATION RECOMMENDATION: APPROVE one-time waiver of Board of Supervisors designation for the sharing of cable television franchise fees and AUTHORIZE the Office of Communications and Media Director to deposit a check in the amount of$7,500, representing delinquent franchise fees from Ponderosa Cable Systems, Ltd., to the Community Access TV budget unit to mitigate system evaluation and legal costs related to the license renewal and transfer requests of Ponderosa. FISCAL IMPACT: On May 22,2003, unsecured property owned by Ponderosa Cable Systems, Ltd. was sold. The Director of the Office of Communications and Media filed a claim with the Treasurer-Tax Collector's Office for reimbursement of franchise fees not paid for years 2001 through May of 2003. The claim of$7,500 has been paid. Forty percent of the franchise fees ($3,000) by prior Board designation would be deposited to the Community Access TV budget unit. The remaining $4,500 would go to the General Fund. However, since expenditures of$1,683 to CSI Telecommunications for a technical standards review of the system and over$5,000 in attorney fees were incurred by the Community Access TV budget to review renewal and potential transfer documents for the system before its sale, staff recommends that this fund be reimbursed for $4,500 of those expenses and that the entire disbursement for$7,500 be deposited to the Community Access TV budget unit. BACKGROUND: In August, 1997, Ponderosa Cable Systems, Ltd. applied for a renewal of its Cable Television License, which was due to expire on August 23, 1997. Staff had Ponderosa's financial and technical qualifications reviewed and identified several areas of concern. Over time it became evident that Ponderosa Cable Systems, Ltd., would be unable to continue to provide adequate cable TV service. CONTINUED ON ATTACHMENT: YES SIGNATURE: _RECOMMENDATION OF COUNTY ADMINISTRATOR RECOMMENDATION OF BOARD COMMITTEE ROVE OTHER SIGNATURE(S• '' ACTION OF BO ON Ime 8, 2004 _ APPROVED AS RECOMMENDED OTHER VOTE OF SUPERVISORS 1 HEREBY CERTIFY THAT THIS IS A X UNANIMOUS(ABSENT None ) TRUE AND CORRECT COPY OF AN AYES: NOES: ACTION TAKEN AND ENTERED ABSENT: ABSTAIN: ON MINUTES OF THE BOARD OF SUPERVISORS ON THE DATE SHOWN. ATTESTED June 8, 2004 JOHN SWEETEN,CLERK OF THE BOARD OF SUPERVISORS AND COUNTY ADMINISTRATOR cc:CAO r Director,office of Communications and Media B t&tjPUTY On June 26, 2000, Ponderosa submitted an application for approval of the transfer of its Cable TV License to Seren Innovation, Inc. On October 10, 2000, Seren Innovations, Inc., withdrew its application for the transfer of the Ponderosa Cable System stating "certain contingencies to the agreement between Seren and Ponderosa have failed, including but not limited to what we perceive to be significant system deterioration and degradation of the subscriber base." Staff continued to work with Ponderosa to resolve technical, customer service, and management and cash flow issues. On February 5, 2001, staff notified Ponderosa owners, one of who had stopped operating the system due to health reasons, that their cable TV license would expire on August 31, 2009. Ponderosa replied that they were having financial difficulties, which they were attempting to resolve. Subscribers were switching to other providers. Both AT&T (now Comcast) and satellite providers served the area. Finally, on February 6, 2003, staff notified Ponderosa that its franchise had expired and in accordance with County Ordinance Code Section 14-4.004, if Ponderosa continued to operate the system without a franchise after 60 days, all gross receipts from the system must be forfeited to the County. On May 22, 2003, the Ponderosa system was sold to AT&T( now Comcast). Staff filed a claim for excess proceeds with the Treasurer-Tax Collector's Office for franchise fees due from Ponderosa for 20011 2002 and six months of 2003. A check in the amount of$7,500 was received and staff requests that the Board authorize deposit of the entire amount into the Community Access TV budget unit. The additional general fund portion of franchise fees ($4,500) would cover, in part, $1,683 to CSI Telecommunications for a technical standards review of the system and over$5,000 in attorney fees.