RECOMMENDATION(S): (CONT'D)
AUTHORIZE the County Administrator or his designee to sign and send a letter to AT&T requesting that AT&T designate a sufficient amount of capacity on its network to allow the provision of four (4) PEG channels as authorized by California Public Utility Code section 5870.
FISCAL IMPACT:
The County is currently receiving 3% or an average of $3,300 per quarter of AT&T's gross revenues for PEG support. These revenues are derived from AT&T's operation of its network to provide cable and video service within the unincorporated areas of Contra Costa County.These funds can only be used for facilities and equipment for PEG channels in accordance with federal law. The exact amount of revenue anticipated is unknown as the new statewide franchise holders may attract video and cable service customers from current cable providers or new customers who previously were not video and cable subscribers. This ordinance will assure that AT&T and any new state video franchise holders pay an appropriate PEG support fee and meet customer service obligations.
BACKGROUND:
The Digital Infrastructure and Video Competition Act of 2006 (“the Act”) went into effect on January 1, 2007. Pursuant to the Act, the State of California was granted authority to franchise video service providers throughout the state. Previously, local governments held sole franchising authority and, through this power, the County franchised video service providers, Astound and Comcast. Although the County will not be the franchising authority for video service providers granted a state franchise, the County will acquire certain rights and responsibilities with respect to state video franchise holders.
The Act grants the County a franchise fee of up to five percent of the gross revenues for each video service provider franchised by the state, which is currently the percentage of gross revenues that the County receives from its local franchises with Astound and Comcast. Additionally, video service providers franchised by the state must pay the County a fee of between one to three percent of gross revenues to support PEG channel facilities, provided the County has enacted an ordinance establishing such a fee.
The Act provides that the County must monitor state video franchise holders’ provision of customer service. The required standards of customer service are set forth in the Act and the County may impose fines for violations of those standards if the County enacts an ordinance or resolution establishing a fine schedule. The amount of each fine is limited by the Act.
For the purposes of establishing PEG fees and a fine schedule, it is recommended that the County adopt the attached ordinance.