Loading...
HomeMy WebLinkAboutMinutes 10/18/1993UTILITY ADVISORY COMMITTEE Port Angeles, Washington October 18, 1993 II. Call to Order: Mayor Hallett called the meeting to order at 4:32 p.m. Roll Call: Members Present: Jim Hallett, Gary Braun, Joe Michalczik, and Richard Wight. Members Absent: Thomas Hunt. Staff Present: C. Knutson, B. Upton, C. Hagar, J. Pittis, B. Titus, S. Hursh, and J. Pomeranz. III. Approval of Minutes: Councilman Wight moved to approve the minutes of the September 13, 1993, meeting as written. The motion was seconded by Councilman Braun and passed unanimously. IV. Discussion Items: Cable TV Rate Regulations - Presentations by Northland Cable and 3H Cable Consultants Mayor Hallett gave a brief review of rate regulating. Dan Withers of Northland Cable introduced Rose Wilhelm, Port Angeles Office Manager, and Mike Sturgeon, Plant Manager. Mr. Withers complemented 3H Cable Consultants on the package they put together regarding rate regulations. This is a very complex and confusing issue and 3H did a great job in putting this package together in an understandable format. Mr. Withers informed the Committee that as far as Northland Cable is concerned, they are neutral on whether or not the City should apply for certification. They will do their best to provide needed information to the City to help make this decision. The FCC is -1- Utility Advisory Committee October 18, 1993 attempting to get out of rate regulating due to the expense involved. Since rate regulating went into effect the FCC has hired 250 staff members to support rate regulations. Northland has heard that the FCC has spent 40% of their budget on rate regulations alone this year. Northland Cable has gone through the bench mark process, and in that process they lowered the rate on economy basic from $14.25 to $13.00 and allowed for the by- through option, which is part of rate regulations. Mr. Withers then went on to explain what the by-through processes consisted of, and what many other cable stations had to do to comply with FCC regulations which resulted in higher cable fees for their customers. Mr. Withers wished to stress to the Committee that becoming certified involves high administrative costs and a great deal of time spent formatting the rules to comply with FCC rules and regulations. Mr. Withers distributed hand-outs which answered many questions the City may have regarding customer service, and showed Northland's compliance with current regulations. The local cable office has complaint forms available for customers who wish to express their displeasure over rates. However, thus far neither the City nor the local cable company has received any complaints, even though rates were raised by $.50 in April. Northland is currently going through their budget process and have no rate increases planned prior to September of 1994. Miles Overholt, 3H Cable Consultants, introduced himself, and agreed with Dan Withers that the process of becoming certified was a complicated issue. Information packets were distributed to committee members. One of the most important facts the City will have to look at in making its decision, is how Northland's rates compare to other cities. This was shown on a chart distributed by Mr. Overholt. Mr. Overholt when on to inform the Committee that the only rates the City would be certified to regulate would be the basic rates, satellite services will remain under FCC regulations, and channels such as HBO and Showtime will not be regulated by anyone. If the City opts for certification, a simple form msut be completed and sent in, with notification to the cable operator. The City then has 120 days in which to adopt two resolutions pertaining to certification, one which says the City will adhere to FCC regulations and one adopting a hearing process. Uponpassageoftheresolutions, theCity notifies the cable operator that this has been done and the operator then sends rates and substantiation to the City. Mr. Overholt then distributed a sheet setting forth the pros and cons of City rate regulating. Mr. Overholt continued to explain his handouts and review what certification would mean to the City as well as the cable operator. Lon Hurd, 3H, informed the Committee that a vast majority of the communities are in the process of being certified. He felt that eventually 90% of the cities will be certified. 3H would be able to perform some of the duties entailed in certification and Lon Hurd went on the describe what these would be. -2- Utility Advisory Committee October 18, 1993 Further discussion followed between Northland Cable and 3H Cable Consultants, with many questions being asked by Committee members. Dan Withers reminded everyone that there is a rate freeze in effect until 11/15/93, and that Northland has no increases planned until 9/94. They went on to discuss what the different tiers of service consisted of and what current rates are. Councilman Wight felt it was the City's responsibility to become certified. He felt that if the City did not, and rates were increased and the constituents discovered that the City might have been able to prevent this, but did not take the steps, people would be very angry. Councilman Braun felt things should be left as they are for now, with certification being pursued later if it is felt to be necessary. Joe Michalczik felt this was a complicated situation and expressed a fear of the City getting involved in rate setting. He felt the City should periodically review the need to certify. Mayor Hallett felt the City should not be involved in rate making. If rates go too high, people have the option of dropping cable, as it is not a necessity such as power or water. Mr. Withers wished to point out that when he started with the cable company in 1974, the cost per channel was $.75 each. Almost twenty years later it is only $.76 per channel for basic and $.72 per channel for extended. This would seem to prove that a need for regulation does not exist. After further discussion, Councilman Braun moved to reconnnend to the Council that the City not proceed with certification at this time; however, the staff and the Consultants will continue to monitor the rates on an ongoing basis so that certification can be pursued in the future should the need arise. Joe Michalczik seconded the motion. After lengthy discussion, with the Committee being reminded that they can become certified to regulate without ever regulating, a vote was taken on the motion which carried by a majority with Councilman Wight voting in opposition. B. Consideration of Expiration of Terms of Office Mayor Hallett reviewed the information provided by the City Clerk. Mr. Michalczik expressed interest in being reappointed. Councilman Wight moved for reconnnendation to the City Council for the reappointment of Joe Michalczik, and for the Council to direct staff to advertise, via the use of news releases, for replacement of Tom Hunt as the community representative on the UAC. Councilman Braun seconded the motion, which carried unanimously. -3- Utility Advisory Committee October 18, 1993 C. Undergrounding Mayor Hallett reviewed the information provided by the Light Department. City Light Director Titus wishes direction on this matter as Council had expressed an interest in this in the past. Steve Hursh informed the Committee that the difference in cost in undergrounding and overheading varies depending on the trenching fees involved. It probably runs between $400 and $500 on an average. A builder has to do some trenching anyway to put in water and sewer lines. It is assumed that the new Comprehensive Plan will do away with overhead wiring. It was suggested that an incentive be offered to urge people to put in underground wiring versus overhead wiring. At this point, the City is contributing up to $917 towards the cost of extending this service. It was the general consensus of the Committee to have staff do some investigating of this and look into the possibility of offering incentives for underground wiring only in order to discourage overhead. The Light Department will do some background work and report back to UAC with options and costs at a future meeting. D. Customer Service Wires and Undergrounding of Landlocked Facilities Mayor Hallett reviewed the information provided by the Light Department. Staff is looking for direction as to distribution of costs between the citizen and the City for converting from overhead to underground wiring. The RCW's allow the City to require the customer to pay all costs, or the Council can direct the City to pay part of the costs. Director Titus went on to describe some of the problems that have arisen with converting landlocked facilities. The Light Department will look into ways of reducing the cost to rate payers and the City and bring this information back to a future meeting. E. Revisiting Electrical Permit Fees Director Titus reviewed the information provided by the Light Department. The City is currently potentially over-collecting on it's electrical permit fees. Steve Hursh then explained to the Committee why the Light Department would like to see any fee reduction be retroactive to April 6, 1993. Some of the electrical contractors have expressed concern over the current electrical fees, and have expressed an interest in coming to a Council meeting to discuss this. The Light Department feels that the permit fee could be reduced from 1% to 1/2% of the cost of the electrical work for new commercial and industrial services exceeding 1,000 amps. The City will not know for sure if 1/2% is a more equitable charge, until the major projects underway, (i.e. Sr. Ctr., Fire Station and Juvenile Center) are completed and billed. Mayor Hallett recommended that the 1% fee stay in place until the current projects are completed; at that point the City will be in a better position to place the fees, with refunds going to the party that ultimately paid the fees, in most cases this will be the owner. Staff will prepare a Resolution which implements this recommendation. Utility Advisory Committee October 18, 1993 F. BPA Power Sales Contract Discussions (Informational only) Director Titus reviewed the issue paper on the renegotiation of BPA wholesale power contract. The BPA contract expires in 2001. The Light Department will update the Committee on the renegotiation process on a regular basis. Director Titus felt it was easier to give a one page synopsis on a regular basis than try to present a book of facts at the end of the renegotiation process. Next Meeting: The next meeting of the Utility Advisory Committee will be held on Monday, November 8, 1993, at 4:30 p.m. VI. Adjournment: The meeting was adjourned at 6:50 p.m. Deputy City Clerk -5-