V.1. Cable Franchise Public Hearing; Genellie (Memo)Memorandum
To: Hopkins City Council
From: Jim Genellie
Date: May 12, 2015
Subject: Cable Franchise Public Hearing
At the March 16, 2015 City Council meeting, the Hopkins City Council ordered the
publication of a Notice of Intent to Consider Applications for a Cable Franchise as well as a
Request for Proposals. The Notice was published twice in the official newspaper. Copies
were also sent to Comcast, the current cable franchise, and to CenturyLink which had
indicated an interest in acquiring a cable franchise in Hopkins.
The City received an application from CenturyLink for a cable franchise in Hopkins. On
April 21, 2015, the City Council ordered a public hearing for May 19, 2015.
The purpose of the public hearing is to:
Receive comment regarding the application received from CenturyLink
Consider the qualifications of the Applicant - Legal, technical, and financial
No decision by the Council is required the night of the public hearing. After the public
hearing the City Council will have an opportunity to consider the documents and testimony
that was presented.
Public hearings will be held in each of the five cities represented by the Southwest
Suburban Cable Commission. Once all five cities have held their public hearings, the
Cable Commission will meet in order to come up with a recommendation regarding
granting a cable franchise to CenturyLink. This meeting will likely occur sometime in June.
The recommendation of the Commission is not binding on the five cities. Each city will
have the choice of whether to grant a franchise to CenturyLink.
At the public hearing:
The Commission’s attorney, Brian Grogan, will present an overview of the franchising
process and review some of the issues.
Representatives of CenturyLink are expected to testify regarding their application.
Representatives of Comcast, the current cable franchisee, are likely to speak as well.
Supporting Information
City of Hopkins Notice of Intent to Consider Applications for a Cable Franchise
City of Hopkins Request for Proposals for a Cable Franchise
Brian Grogan’s PowerPoint
Century Link Cable Franchise Application
May 4, 2015 Letter from Brian Grogan to CenturyLink
CenturyLink response to Brian Grogan
May 4, 2015 Comcast letter to Brian Grogan
\\PublicHearingMemo.docx
NOTICE BY THE CITY OF HOPKINS, MINNESOTA
OF ITS INTENT TO CONSIDER AN APPLICATION FOR A FRANCHISE
Notice is hereby given that it is the intent of the City Council of the City of Hopkins, Minnesota,
to consider an application for a franchise for the purpose of operating a cable communications
system to serve the City of Hopkins, Minnesota. This notice is given in accordance with the
requirements of Minn. Stat. § 238.081.
Applications shall be submitted in response to this Notice and Request for Proposals available
st
on request in the office of the Jim Genellie, Assistant City Manager, City of Hopkins, 1010 1 St
S., Hopkins, MN 55343.
A.The deadline for submitting applications is April 15, 2015.
B.Applications shall be in writing, notarized, in a format consistent with the
Request for Proposals, and sealed with eight (8) copies enclosed. Applications
shall be delivered to the attention of Jim Genellie, Assistant City Manager, City of
st
Hopkins, 1010 1 St S., Hopkins, MN 55343. Two (2) additional copies shall be
simultaneously submitted to the City’s outside legal counsel, Brian Grogan, Moss &
Barnett, 150 South Fifth Street, Suite 1200, Minneapolis, Minnesota 55402.
C.Pursuant to Minn. Stat. § 238.081 subd. 8, Applicants will be required to
reimburse the City for all necessary costs of processing a cable communications
franchise. Each application shall include an application fee of Ten Thousand and
No/100 Dollars ($10,000) in the form of a certified check made payable to the
City of Hopkins, Minnesota. Any unused portion of the application fee shall be
returned to the Applicant and any additional fees required to process the
application and franchise beyond the Application fee shall be assessed to the
Applicant.
D.Applicants are requested to be present at a public hearing before the City Council
that is presently scheduled to be held at City Hall, beginning at approximately 7
p.m. on May 19, 2015. Each applicant will be given time to summarize its
application.
E.The Request for Proposals sets forth in detail the expectations of the City of
Hopkins, Minnesota and the requirements of the content of the franchise
proposal and are made in conformance to the requirements of Minn. Stat. §
238.081, subd. 4.
F.The services to be offered are identified in the Request for Proposals and include
a system providing public, educational and governmental access channels
consistent with state law; a mix, level and quality of programs and services
comparable to other systems in the region serving similar sized communities and
customer services and maintenance plans to ensure quality service to the
subscriber. The Request for Proposals provides further details of the services to
be offered.
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G.The criteria for evaluating the applications and priorities for selection are as
follows:
1.The completeness of applications and conformance to Request for
Proposals;
2.Customer service policies and system testing;
3.The legal, technical, and financial qualifications of the applicant; and
4.The proposal for community services, including public, educational, and
governmental access in accordance with state law.
Applications which meet the above criteria in the opinion of the City Council shall
H.
be considered for a franchise.
The applicant(s) selected by the City Council will be required to accept the
I.
franchise documents granted within thirty (30) days after adoption.
All questions concerning this request should be directed to the City’s outside legal
J.
counsel, Brian Grogan, Moss & Barnett, 150 South Fifth Street, Suite 1200,
Minneapolis, Minnesota 55402; phone (612)877-5340.
Date: March 16, 2015
CITY OF HOPKINS, MINNESOTA
By:
Its:
2792289v1
REQUEST FOR PROPOSALS
Official Application Form
Applicants interested in submitting a proposal for a cable communications franchise shall submit
the following information as required by Minnesota Statutes Section 238.081 (subd. 4) to the City
of Hopkins, Minnesota (“City”) on or before April 15, 2015.
A.Plans for channel capacity, including both the total number of channels capable of
being energized in the system and the number of channels to be energized
immediately.
B.A statement of the television and radio broadcast signals for which permission to
carry will be requested from the Federal Communications Commission.
C.A description of the proposed system design and planned operation, including at
least the following items:
1.The general area for location of antenna and headend, if known;
2.The schedule for activating cable and two-way capacity;
3.The type of automated services to be provided;
4.The number of channels and services to be made available for access cable
broadcasting; and
5.A schedule of charges for facilities and staff assistance for access cable
broadcasting.
D.Terms and conditions under which particular service is to be provided to
governmental and educational entities.
E.A schedule of proposed rates in relation to the services to be provided and a
proposed policy regarding unusual or difficult connection of services.
F.A time schedule for construction of the entire system with the time sequence for
wiring the various parts of the area requested to be served.
G.A statement indicating the applicant’s qualifications and experience in the cable
communications field, if any.
H.An identification of the municipalities (including contact information for the
municipal officials in each community) in which the applicant either owns or
operates a cable communications system, directly or indirectly, or has outstanding
franchises for which no system has been built.
I.Plans for financing the proposed system, which must indicate every significant
anticipated source of capital and significant limitations or conditions with respect to
the availability of the indicated sources of capital. This information should include:
1.Current financial statements;
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2.Proposed sources and uses of funds for the construction project;
3.Financial budgets for the next three (3) years;
4.Documentation regarding the commitment of funds; and
5.Any other information that applicant determines would be useful in
evaluating its financial qualifications.
J.A statement of ownership detailing the corporate organization of the applicant, if
any, including the names and addresses of officers and directors and the number of
shares held by each officer or director, and intercompany relationship, including the
parent, subsidiary or affiliated company.
K.A notation and explanation of omissions or other variations with respect to the
requirements of the proposal.
Substantive amendments may be made to a proposal after a proposal has been submitted only
upon approval of the City and before the award of a franchise. All proposals must be notarized
and must include responses to the above information requests, as well as the information
requested in the Notice by the City of its Intent to Franchise a Cable Communications System,
available from the City upon request.
Applicants are advised that Comcast currently provides cable television service throughout the City
of Hopkins, Minnesota.
The City reserves its right to request additional information of any applicant at any time during this
process.
Any questions regarding this Request for Proposals may be directed in writing to the City’s outside
legal counsel, Brian Grogan, Moss & Barnett, 150 South Fifth Street, Suite 1200, Minneapolis,
Minnesota 55402; phone (612)877-5340.
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2792295v1
Competitive Franchising
Public Hearing –May 19, 2015
City of Hopkins, Minnesota
Presented by: Brian T. Grogan, Esq
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Purpose of the Public Hearing
Receive comment regarding Application
received from CenturyLink
Consider qualifications of Applicant
Legal, technical, and financial
•
No decisions required this evening
Commission will issue recommendation for
City consideration
Franchise negotiations have not yet
commenced
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Franchise Application Timeline
City published Notice of Intent to Franchise
March 26 & April 2
•
Closing date for submission of applications
April 15, 2015
•
CenturyLink submitted application
•
May 2015 Moss & Barnett Report regarding
qualifications of applicant and
•
recommendation to Commission
•
May-June negotiations regarding CenturyLink
franchise terms
Franchise with Comcast will serve as the “base
•
document.”
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Federal Cable Act
One of the stated purposes of the Cable Act
is to:
“
promote competitionin cable communications
and minimize unnecessary regulation that would
impose an undue economic burden on cable
systems.”
See47 U.S.C. §521 (6) –emphasis added
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Federal Cable Act
A franchising authority may award one or
more franchises within its jurisdiction:
“except that a franchising authority may not
grant an exclusive franchise and may not
unreasonably refuse to award an additional
competitive franchise.”
See47 U.S.C. §541 (a)(1) -emphasis added
-codified in the Cable Act as Section 621
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Existing Comcast Franchise
Competitive Equity -§17.18
Whatever agreement the City grants to CenturyLink
Comcast has the right to the same agreement.
Within one hundred twenty (120) Days after the Grantee
•
submits a written request to the City,
the Grantee and the City shall enter into an agreement or
•
other appropriate authorization (if necessary) containing the
same terms and conditionsas are applicable to the new
Wireline MVPD.
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Minnesota Statutes -Build Out
Minn. Stat. §238.08 Subd. 1(b):
No municipality shall grant an additional
franchise for cable service for an area included in
an existing franchise on terms and conditions
more favorable or less burdensome than those in
the existing franchise pertaining to:
(1) the area served;
(2) public, educational, or governmental access
requirements; or
(3) franchise fees.
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Minnesota Statutes -Build Out
Minn. Stat. §238.084 Subd. 1(m)
Initial franchises must include a schedule
showing:
that construction throughout the authorized
•
franchise area must be substantially completed
within five years of the granting of the
franchise
This requirement can be waived by the franchising
authority only upon occurrence of unforeseen events
or acts of God.
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Federal Law –Build Out
12/20/06 FCC adopted
Report and Order and Further Notice of
•
Proposed Rulemaking implementing Section
621(a)(1) of the Communications Act of 1934.
621 Order
FCC concluded
“that it is unlawful for LFAs to refuse to grant a
•
competitive franchise on the basis of
unreasonable build-out mandates.”
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FCC Identified Build Out Mandates
UnreasonableReasonable
Absentotherfactors,requireanewcompetitiveentranttoserveToconsiderthenewentrant’smarket
everyoneinafranchiseareabeforeithasbegunprovidingservicetopenetration.
anyone.
Toconsiderbenchmarksrequiringthe
Requirefacilities-basedentrants,suchasincumbentLECs,tobuild
newentranttoincreaseitsbuild-outafter
outbeyondthefootprintoftheirexistingfacilitiesbeforetheyhaveareasonableperiodoftimehadpassed
evenbegunprovidingcableservice.afterinitiatingserviceandtakinginto
Absentotherfactors,requiremoreofanewentrantthananincumbentaccountitsmarketsuccess.
cableoperatorby,forinstance,requiringthenewentranttobuildout
isfacilitiesinashorterperiodoftimethanthatoriginallyaffordedto
theincumbentcableoperator;orrequiringthenewentranttobuild
outandprovideservicetoareasoflowerdensitythanthosethatthe
incumbentcableoperatorisrequiredtobuildouttoandserve.
Requirethenewentranttobuildoutandprovideservicetobuildings
ordevelopmentstowhichthenewentrantcannotobtainaccesson
reasonableterms.
Requirenewentranttobuildouttocertainareasorcustomersthatthe
entrantcannotreachusingstandardtechnicalsolutions.
Requirethenewentranttobuildoutandprovideservicetoareas
whereitcannotobtainreasonableaccesstoanduseofthepublic
rightsofway.
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5
FCC 621 Order
Applies to actions or inactions at the local level
where a state has not specifically circumscribed the
LFAs authority and only addresses decisions made
by municipal-level franchising authorities.
Does not address any aspect of a LFAs decision-
making to the extent that such aspect is specifically
addressed by state law.
The only items preempted by the 621 Order are
local laws, regulations, practices, and requirements
that conflict with the guidance adopted in the 621
Orderand that are not specifically authorized by
state law.
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FCC Order on Reconsideration
Adopted on Jan 21, 2015
The FCC reiterated its position that its findings
in the 621 Order were limited to the local level
Inconsistency between the federal and state
requirements raises the question of federal
preemption
Award of cable franchise in Minnesota
Quasi-judicial
•
Weigh evidence before issuing decision
•
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