1996-12-18 - CC Packet - Laserfiche WebLink

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REPORT OF LEGAL COUNSEL: Legal Counsel reviewed his letters dated October 28 & November 15, to US West counsel (John Gibbs regarding US West's noncompliance in obtaining all necessary federal, state and local government waivers, authorizations or other approvals conditioned upon the commission/cities Transfer Consent Resolutions and the subsequent franchise violations. Legal counsel was concerned that U.S. West has blantantly disregarded the conditions placed on the transfer by the Commission in its transfer resolution. The FCC's, Cable Bureau has ruled that local approval of US West's waiver to purchase is not necessary has been appealed by all six system Commissions. U.S. West's position is that all conditions were met when the Cable Services Bureau issued the Waiver for Special Relief to own and operate a cable service within their phone service area; subsequently, no violations exist. Commission Counsel's position is that U.S. West has not complied with the Consent Resolutions by virtue of the Waiver for Special Relief on Appeal and that an Appeal is not a final determination of the Federal Communications Commission and an Appeal in Federal court would remain pending and would not satisfy the Consent Resolution conditions; therefore, Continental Cablevision by transferring to U.S. West is in violation of member city Franchise Agreements and Federal law. Counsel stated that the commission does have the authority to issue a default notice on behalf of each member city pursuant to the Joint Powers Agreement and subsequent termination by individual member cities. Counsel reviewed provisions contained in member cities' Franchise Agreements for Franchise violations; default and notification of same; U.S. West's timeline (30 days) to remedy violation or to appear at the commission's next meeting; recommendation for Franchise termination forwarded to member cities; upon member cities determination, written notification to terminate Franchise Agreement; U.S. West timeline (30 days) to appeal if disputing violation; possibility of assessing penalties for Failure to Comply with any provisions of the Franchise Agreement commencing the date of the violation (November 15, 1996); if no violation has occurred, member cities refund all monies drawn from the Letter of Credit and the Letter of Credit will be replenished by U.S. West if monies are drawn by member cities with failure to replenish same being a violation of the Franchise Agreements. Counsel reiterated that this was a flagrant violation of the Franchise by closing these transactions in violation of the commission's notice to the contrary and a significant affront of the commission's administrative and regulator authority. It is Counsel's opinion that failure to act on this type of violation would set a fairly serious precedent as it relates to the commission's further relationship with U.S. West and recommended that 1) the commission issue a notice of default to the franchise holders and an order to appear at the Commission's next meeting and show cause as to why the Commission should or should not recommend to member cities, - the termination of the Franchise Agreements which U.S. West now claims to hold, 2) issue a notice of Franchise violation and commence procedures to fine the operator as proscribed in the franchise by drawing on Letters of Credit for each member city pending review at a public hearing if requested. Wells stated that he concurred with Counsel's opinion for action. *"ACTION - 11/20/96 -10: Dir. Wurst moved and was seconded to both issue to the franchise holders a notice of default and an order to show cause why the Commission should not terminate the member citv franchises and issue a notice of franchise violation and begin drawing on the Letters of Credit commencing on November 15. 1996 at a level of $100 per day per member city pending review at a public hearing. The Chair opened the floor for discussion. Mr. John Gibbs (Legal Counsel; Meredith /Continental/U.S. West) stated that items regarding the merger between Continental and U.S. West were not on tonights Agenda. Mr. Gibbs stated that a default has not occurred and the Joint Powers Agreement did not delegate the commission power to determine a default but that this was reserved for member cities to determine. Mr. Gibbs stated that U.S. West would be looking forward to public hearings held with member city's councils. U.S. West's position is that with the receipt of the Federal Communications Commission's Cable Services Bureau's decision of October 18, 1996, all necessary approval has been satisfied. Mr. Gibbs reiterated that commission's Counsel had submitted an Appeal for Review and Stay to the full FCC on November 12, 1996, subsequent filing of same does not negate the FCC's decision and their order is currently effective. He stated that he and the operator were available for further discussion.