274026 N�HITE - C�TV CLERK COI1RC11 �L��'�
PINK - FINANCE G I TY OF SA I NT PAU L
CAN�RV - LZ:EPARTMENT ��� .a V
BLUE - MAVOR File NO.
Council Resolution
,
Presented By
Referred To Committee: Date
Out of Committee By Date
WHEREAS, By its resolution adopted on March 6, 1979, the City
Council of the City of Saint Paul expressed its intention to con-
sider the adoption of an ordinance leading to a cable communications
franchise; and
WHEREAS, The Council further expressed its desire to more fully
inform itself about cable communications prior to the adoption of
such an ordinance and the awarding of such a franchise; and
WHEREAS, To more fully infnrm itself, the Council established
a Citizens ' Advisory Committee on Cable Communications; and
WHEREAS, Said Committee was directed to study the area of
cable communications, assess the communications needs of the cit-
izens of Saint Paul, consider the requirements and specifications
for a cable service territory, examine the staffing and consulting
needs of the franchising process, evaluate the curre� sta�� o€
the art and available technology utilized by cable communications
systems, evaluate the prospective applicants ' capability to meet
the needs of the citizens of Saint Paul and report its findings
to the Council in the form of a study with final recommendations
concerning whether to continue the franchise process leading to an
ordinance and an award of a cable communications franchise; and
�
WHEREAS, Said Committee adopted, undertook and successfully
completed a work task program which fulfilled the above directions
of the Council; and
COUNCILMEN Requested by Department of:
Yeas Nays
Butler (n Favor
Hozza
Hunt
I,evine _ Against BY
Maddox
Showalter
Tedesco Form Approved by City Attorney
Adopted by Council: Date � �
Certified Passed by Counc.il Secretary BY `
By
Approved by :Navor: Date _ Approved by Mayor for Submission to Council
By _ — — — BY , ,
�,;�'�,
rs�";{'.�r.�r��
2.
WHEREAS, At its meeting of November 7, 1979, the Committee
approved its report and recommendations for submission to the
Council; and
WHEREAS, One of the Committee' s recommendations is that the
City Council continue the franchising process; now, therefore,
be it
RESOLVED BY THE COUNCIL OF THE CITY OF SAINT PAUL:
1. That the report and recommendations of the Citizens'
Committee regarding cable communications are hereby accepted by
the City Council of the City of Saint Paul;
2. That it is the determination of the Council that the
Council continue the franchising process;
3. That the Council determines that in continuing the fran-
chising process, the visiting of cities possessing cable commun-
ications installations to gather information will enable the
Council to more wisely exercise their legislative duties and
therefore benefit the community in granting a cable communications
franchise;
4. That the Council determines that the cost of such visits,
which will initially be at City expense, is a reasonable and
proper cost relating to the process of awarding a cable communi-
cations franchise, and therefore,properly recoverable from the
eventual franchisee as a condition of the franchise ordinance;
5. That because of the expertise it has acquired, the
Citizens ' Advisory Committee is retained to assist the Council
throughout the franchising process and that said Committee shall
meet at the discretion of the Council President; and be it
FURTHER RESOLVED, That the Council of the City of Saint Paul
hereby wishes to express its appreciation to each citizen member
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Q N V- Ip L N N r O�Q U 4- �. f1 u �. N L1
WHITE - C�TV CLERK COUIICII /- /(,,,�,�i��
PINK - FINANCE GITY OF SAINT PALTL
CANARV - DEPARTMENT �\W S gi )��4�
BI.UrG - MYAVOR File NO.
Co�ncil esolution
Presented By
� � �.��-t.
Referred To Committee: Date
Out of Committee By Date
3.
of the Citizens ' Advisory Committee for the development of this
comprehensive and farsighted document.
COUIVC[LMEN Requested by Department of:
Yeas �HON Nays
� [n F�vor
Hunt
Levine �__ Against BY
Maddox
Showalter
Tedesco ��g�g Form Approved by City Attorney
Adopted by Council: Date � �
Certified s d by Counc' ,ecr By `
App b Mavor: Da ��V � Approved by Mayor for Submission to Council
By - BY
_..!ft''%y��lilt.Y� �Y L% 4, � � ��l�
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, REPORT AND RECOMMENOATIONS
, CFTIZENS ADVISORY COMMITTEE ON CABLE COMMUNICATIONS
, November 15, 1979
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, REPORT AND RECOMMENDATIONS
� CITIZENS ADVISORY COMMITTEE ON CABLE COMMUNICATIONS
� I . THE CHARGE TO THE COMMITTEE
II . WORK PLAN OF THE COMMITTEE
� III . ISSllES AND PROBLEMS
� Federal Regulation
State Regulation
The Cable Service Territory
, Interconnection
Ownership Alternatives
Public Access
Computer Learning and Information Systems
, Public Libraries and Cable TV
Educational and Arts Use
Institutional Cable
� Municipal Access Channel
Rate Regulation
Use of Consultants
The Future
, IV. RECOMMENDATIONS
, The Franchising Process
Municipal Regulation and Znvolvement
System Design
Local Community Programming and Access
,
� JOANNE SH04�ALTER, Chair CHARLES HAY�ES
ROGER BROOKS THOMAS KAYSER
DENNTS CHADA MARLA KENNEDY
ROGER CHRISTTANSON JANET SANDS
� JOHN COCHRANE JOHN THOEMKE
SHELDON GOLDSTEIN JAMES TOSCANO
LARRY ALAN WINANS, Staff
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� November 15, 1979
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� THE CHARGE TO THE COMMITTEE
The development of cable television in the State of Minne-
� sota � s subject to Federal , State and local regulation . Before
� a cable system is allowed to operate in this state, it must
receive a franchise from the local government and a certificate
� of confirmation from the Minnesota Cable Communications Board
(MCCB) .
� The State Cable Board has promulgated rules and regulations
� governing the franchising procedures undertaken by local govern-
ment and has mandated certain minimal standards which must be
� addressed by the franchise ordinance. (4 Minnesota Code of
Agency Rules Section 4. 001 et seq. )
� The process leading to the award of a franchise is regu-
� lated by the State, in particular, the MCCB requires the City
to appoint a citizens advisory committee prior to considering
applications for the franchise. The citizens committee is
responsible for a general study of cable TV with especial atten-
� t�on to be given to prob] ems , needs and potential uses which
should be considered before continuing the franchising process.
� The mandated study was to remedy a difficulty experienced in
� other states. Frequently, franchises had been granted without
sufficient concern for the community' s best interests. Minne-
� sota seeks to avoid such a situation and, therefore, designed
the citizens committee study in order to collect and analyze
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� WORK PLAN OF THE COMMITTEE
� The Committee was obligated to pursue a study, but the
approach to be used was not prescribed. The Committee, there-
� fore, formulated its own approach to fulfilling its responsi-
bilities leading to the franchising process .
� The Committee chose to conduct its activities through the
following endeavors :
� 1. Review of published materials
� 2. Testimony of several individuals possessed of expertise
� relative to cable TV
� 3 . Presentations by representatives of interested cable
companies
� 4. Establishment of a task force to study the particular
� needs of the arts community and educational institu-
tions
� 5. Establishment of a task force to investlgate potential
institutional use of cable TV
� 6. Circulation of an introductory background paper enti-
tled "Citizens Guide to Cable TV" to the community
� press .
� 7. Holding one neighborhood informational meeting at the
Lexington Public Library and one at Harding High
� School
The Committee has taken considerable time to inform itself
� about ca61e television and to 6egin the process of informing
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� the general public about cable. The Committee could serve as a
� valuable information resource during the upcoming months.
The submission of this report signifies the beginning of
� St. Paul ' s involvement with ca61e communications , not its con-
clusion. The future will involve the Council ' s Invitation for
� Applications , public hearings concerning the applications, the
actual award , drafting the franchise and regulatory ordinances ,
� regular rates review, system testing , complaints resolution and
� general monitoring of the operation of the cable system. In
addition there will be opportunity for public involvement in the
� programming of the access channels and in continuing improvement
of communications services.
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� ISSUES AND PROBLEMS
� The Citizens Advisory Committee has identified the follow-
ing areas of concern, potential problems , issues , and communi-
� cations needs which must be addressed by the City of St. Paul
and i ts cabl e francf�i see .
� 4�e have endeavored nat only to list the problems but to
provide proximate solutions in Section IV of this report deal -
� ing with the Commi.ttee' s recommendations to the City Council .
� Federal Regulation
� The Communications Act of 1934 established Federal juris-
diction over telecommunications including radio and television
...
� broadcasting . There is no expressed provision subjecting cable
television to the authority of the Federal Communications Com-
� mission (FCC) . Nevertheless , the Commission has asserted juris-
diction over a number of aspects of cable due to its involvement
� with and affect on broadcasting.
� The status of Federal regulatory efforts is in flux due to
a combination of factors including the general deregulatory
� trend aff ecting a number of areas , FCC willingness to revise
and withdraw from its previous involvement and court rulings
� limiting Federal jurisdiction. Deregulation has caught some
� cities by surprise resulting in difficulties regarding their
franchises. A number of municipalities had fashioned their
� franchise provisions to obligate the franchisee to adhere to
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� 6
� FCC standards and when these standards were withdrawn by the
Commission , such as in the case of the FCC mandated dccess
� requirement, some municipalities found that their ordinances
� were no longer binding on the cable system operators . The
problems occasioned by others enhance the argument that the
� City of St. Paul address all those issues over which it feels
it should retain control .
� The movement towards deregulation is further augmented by
� the efforts of a number of Congressmen who have introduced bills
-- favoring a laissez-faire approach to communications in general
� and cable in particular. A recent bill (H. R. 3333� offered in
the 1979 session by Rep. Lionel VanDeerlin would have prohibited
� the states and local governments from any control over cable TV.
_ The bill was witF�drawn by its author, but the movement for
�' deregulation poses a continuing challenge to the City of St. Paul
� and like-minded communities seeking the development of cable
systems in the public interest.
� One regulatian which remains in effect as of this date
places a limitation on the City' s franchise fee. The fee derived
� from gross revenues is currently limited to 3-5 percent. The
� restriction is under review by the Commission and may be lifted
i�n the near future. The City may at that time wish to review
� or renegotiate its francF�ise fee and the ordinance should reflect
that possibility for adjustment.
�
�
�
,
� �
� State Regulation
State regulations by the Minnesota Cable Communications
� Board set three steps leading to the award of a cable franchise:
� 1. Study
Conducted by a citizens advisory body
� 2. Applications
Tnitiated at the City' s invitation, the applications
� are evaluated 6y the Council in a full public proceed-
� jn9
3. Award
� Applicant %s selected and ordinance is draf ted
This report completes step one. Step two is commenced by
� action of the City Council when it issues its Invitation for
_ Applications. That Invitation is the primary tool to be used
� by the City to extract the information necessary to make its
~ decision regarding the franchise award . The Invitation struc-
�
tures the applications made in response, which should include
� data relative to the operator' s experience with other cities ,
�
personnel , plans for service, system design and capital where-
� withal .
The preparation of the Invitation is governed by State
� fra c ' ord ' nance itself.
reguiation as is the n hise i
� The State requires that the franchise include certain pro-
visions. These are to be considered as minimal standards and
� do not limit the City' s own formulation of more restrictive
regulations . Among these provisions may be found the follow-
� ing which are to be included in the City' s ordinance before
� the cable operator receives a state certificate of confirma-
tion :
�
� 8
� 1. Statement that the applicant ' s qualifications were
reviewed in a full pu6lic proceeding -
� 2. That the franchise is nonexclusive
3. That the initial term be limited to no more than
15 years
� 4. That any subsequent renewal be limited to no more than
10 years
� 5. That subscriber consent be obtained prior to mon1toring
�'- of viewing patterns
6. Subscriber contracts are to be limited to no more than
� 12 months
7 . Provision for consumer complaints resolution
� 8. Minimal channel capacity of 20 channels
9. Access to 6e provided on four channels reserved for
� public access , educational use, governmental use and
� leased access
10. Provide facilities for access users
� 11. Two-way capability
,-� 12. Performance standards
� 13. Indemnification and liability insurance
� 14. Prohibit transfer without city approval
15. Provisions governing termination of franchise
� 16. Construction timetable
17. Provide for grant of right to use streets
� 18. Appointment of permanent advisory body
19. Appointment of regulatory official
� 20. Provide for metro interconnection
�
�
� 9
� The Cable Service Territory
- On October 12 , 1979 , the Minnesota Cable Communications
� Board approved the City' s proposal to designate St. Paul as a
� cable service territory (CST) . The City of St. Paul became the
first municipality to avail itself of its authority under State
� cable regulations to propose itself as a service territory.
Previously, cities had allowed that initiative to 6e assumed by
� a cable TV company seekfing the franchise.
� The cable service territory is the official designation
describing the area in which a community is seeking to develop
� a cable system. The CST may be amended in the future to include
adjacent suburbs at the discretion of the City Councils of both
� St. Paul and the suburban municipality.
� Cable Development in the Metro Area
The year 1979 has seen an explosion of interest in cable
�i across the country and Metro Minnesota has been no exception. �
Seven new cabie service territories received approval in the
� Twin Cities area alone. Four nationally active cable companies
� applied for the Minneapolis franchise and eight have formally
indicated an �nterest in the St. Paul market as of this date.
� Unfortunately, the Metro Council ' s involvement in cable
planning ended in 1978 prior to the recent boom. The absence
� of central coordination in the planning process has been felt
� by those municipalities coping with cable franchising .
The Minnesota Cable Communications Board is empowered to
� appoint a metro entity to administer a regional channel ; pos-
sibly this entity may be able to assist in encouraging
�
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�i The revenues received from the municipal cable system would
� be used to retire the bonds , provide community programming , pdy
for management and maintenance services and , possibly, supplement
� the City' s general purpose funds .
The Committee was unable to discover the current existence
� of any alternative to private ownership in a large urban area .
Nonprofit
� Grosse Point, Michigan , has pioneered a rather unique con-
� cept in cable franchising. A local nonprofit community service
organization created a subsidiary corporation to seek the cable
� franchise. The participating city governments use their bonding
authority to rai.se funds for capital investment. In addition ,
� a share of the local cable company was purchased by a national
� cable operator.
The result is a privately managed, nonprofit-owned and
� municipally financed cable franchise. The municipality receives
25 percent of the revenues in addition to its franchise fee.
� The nonprofit community service organization receives another
25 percent for its social service projects , and the private
� company receives the remainder as a return on its contributed
� capital and as a management fee.
Cooperative
� The Committee acknowledges the possibility of this option
although it did not have the time to fully explore its potential .
� A cable cooperative would be a local corporation whose share-
� holders would be the consumers or cable subscribers themselves.
Cooperatives are managed by boards of directors elected by the
� consumer-shareholders and operate substantially like other forms
r
� 12
� of private enterprise. The distinction lies in the fact that
although all enterprise operates in the Znterests of i_t5 owners ,
� in a cooperative enterprise, the owners are the consumers .
� Publjc Access
The State requfires that cable systems serving the Twin
� Cities area allocate four channels to access use. Access means
� simply that these channels are available to particular users
without the editorial supervi.sion of the station or studio
� management. The access channels are programmed by their users ,
� not the system operator.
There will be, at minimum, an access channel reserved for
� the public , educational institutions , the local •government, and
one allocated to leased use. The city may require and the cabte
� operator may offer additional channels for access users.
The concept of access has been subject to a great deal of
� controversy. Some cable operators object to providing access
� on the grounds that they are being denied their property rights
in the use and enjoyment of a cable system constructed with
� private money. The cable industry generally feels that access
is neither desired nor fully utilized by the public at large.
� Access enthusiasts urge to the contrary that communication chan-
nels are a public medium, and as such, should be available for
� public use. Access users advocate that more resources be appro-
� priated by public and private funds in order to encourage access
use and familiarity.
, Minnesota is the only state in the nation to require access
provisions in franchise ordinances. The Council will be well
�
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� advised to monitor the operation of access and the administra-
tion of the access channels during the course of the franchise
� and be prepared to participate in the ongoing dialogue concern-
� ing this topic .
� Computer Learning and Tnformation Systems
As impressive as developments in telecommunications have
� proved to be, they are matched wonder for wonder and innovation
for innovation in the continuing progress in computer technology.
iThe ultimate achievement may be the interface of cable communi-
cations and camputers.
� The Committee has had the opportunity to observe Control
� Data ' s PLATO, a computer learning and information system, whlch
could be connected to a cable system. We realize that there
� are other systems similar to PLATO, including QUBE, SOURCE, VIEW-
DATA, AND VIEWTRON , which are being marketed in other cities .
� The City should consider such systems when planning the St. Paul
� cable system.
Public Libraries and Cable TV
� The St. Paul Public Libraries have established a Video
• � Center where patrons may view videotapes and learn the opera-
tion of video portapak and playback equipment. The storage
� and transmission of information is no longer the captive of
the print medium and cable televis�on has the potential to
� enhance the use of such library services .
�
�
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� 18
� The National Telecommunications and Informatipn Adminis-
� tration of the U . S. Department of Commerce has a program of
grants-in-aid for the development of public telecommunications
� facilities. There is a great deal of competition among local
governments , educational institutions and public TV authorities
, for these funds , nevertheless , the possibility of assistance in
this regard should not be ignored. Fvr example, an NTIA grant
� could be sought to conduct a feasibility study of public service
� programming in a city-owned facility.
Rate Regulation
� The regulation of rates is the most complex and perplexing
� issue affecting cable television . The franchising authority
must, in the course of drafting an ordinance and awarding a
� franchise, establish the rates to be charged subscribers by the
cable system operator. The Minnesota Cable Communications Act
! (Minn. Stat. 238. 12) requires that rates "be those specified in
� the franchise. . . " The rules and regulations of the Cable Com-
munications Board (MCAR 4. 121 (d) � state that the franchise
� ordinance must provide for rates and that adjustments subsequent
to the award be reviewed and approved by the municipality. The
� decision is , therefore , not as to whether to regulate or not,
� but as to what form of regulation should be undertaken.
Regulation is generally established by the public authority
� as an alternative to pric%ng in a free competitive market. The
free market is considered the norm; regulation is selected where
� an economic imbalance precludes competition or where strong
policy considerations dictate.
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� Rate regulation is commonly used in those industri.e5 which
are considered to be public uttlities and which are recognlzed
� as le al and natural mono olies. Such utilit mono olies in-
9 P Y P
� clude electric power, natural gas , telephone service and water
supply.
, Upon the award of a franchise, the franchisee is understood
to receive certain rights and to undertake certain obligations.
� The rights and o6ligations are seen in a reciprocal context, in
� order to be protected from competition the franchisee is obliged
to charge no more than a reasonable and �ust price determined
� by public authority.
The choices left to the City of St. Paul run the spectrum
� between rigorous and detailed rate regulation or relatively per-
� missive and liberal rate review and approval .
Use of Consultants
� The Committee considered the need for consulting services
� during the franchising process. We focused our attention upon
the options available to the City: 1. To choose to forego the
1 use of consultants entirely; 2. To contract the franchlsing
process out including drafting the invitation, evaluating the
� applications and drafting the ordinance; or, 3. To select a
� consultant(s) for particular purposes only.
Tn adopting its recommendation relative to the use of a
� consultant , the Committee desired to include the following
information concerning the various areas of study i:n which
' consulting services may 6e needed .
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� Economic
Economic analysis takes two forms : 1. An lnvestl9a�ion
� into the market to be served by cable. Ts t"t feasi6le? Are
� there enough potential uses and subscri6ers for the service?
2. An evaluation of the potential applicant' s wherewithal to
� successfully lay the ca61e, finance construction , market its
services , provtde programm1ng and serve the communfity.
� No reputa6le ca61e operator would enter a franchise bid
� without perform��ng market research. Tt would not be necessary
for the City to perform thi�s study, although it may requi,re
� applicants to provide the City with the results of thelr
independent studies.
� ,
Careful evaluation of the company' s track record and fiscal
status is essential . The City may desire to contract to a con-
� sultant for that purpose. On the other hand, the City can make
� its own inquiry into the firm' s history and performance in other
communities, as well as demand the production of relative docu-
� mentation. A carefully worded RFP and ordinance may avoid some
of the problems to be occasioned in this area.
� Lega1
There are a number of firms specializing in the drafting
� and formuiation of le al documents relative to the franchise
9
� process. They are usually used by smaller communities without
the benefit of full time legal staff. The City of St. Paul has
� available legal talent, a City Attorney and the nearby services
of the Minnesota Cable Communicati�ons Board.
� �
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� Technical
This i.s a problem area .
, Despite the fact tF�at the FCC and State mandate certain
� requirements , th�s does not detract from the City' s respons%-
bility to assure a minimum level of technical performance for
� a cable franchise. At the minimum, the City will desire to
assure that a system 6e constructed which would be able to take
� advantage of future developments without being locked Tnto an
obsolescent operation.
� Pro rammin
� It is difficult 6ut necessary to evaluate the program
services to 6e offered by prospective cable operators 1n order
� to determine the extent to which they reflect the needs and
interests of St. Paul residents. Consideration should be given
� to such factors as the type of imported serv%ces proposed, the
� degree of commitment to local programming , the means by which
the operator will interact wfith the community in reaching pro-
� gram decisions , and the di`versity of programming services.
�n the area of access programming , St. Paul is fortunate
� to have a Video Communications Center attached to its public
library system. This staff person is available to advise the
� City relative to the use of video e ui ment and its otential
G P P
� hookup to cable TV. In addition , the University Community
Video Center at the University of Minnesota is one of the fore-
, most sources of information on publi.c access programming in the
nation .
�
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� The Future
The study of alternative futures has evolved into a recog-
, nized academic disc�pl �ne, one which has contri6uted signifi.-
� cantly to the formulat�on vf pu6lic policy. The Committee d�d
consider and discuss a num6er of future scenarios which may have
� an affect on the St. PauT cafile system.
Opti`ca1 �itire
� Existing caaxfal cable is constructed of copper. Copper
� is su6ject to sfiortage as a sca-rce natural resource. Tt is
also limited in its carrying capacity as regards the volume of
� slgnals wh%ch can 6e sent and received .
The telecommunicati'ons ��ndustry is now experiment�ng with
ta substitute for copper, optical fibre. The fibre is made of
silicon (glass� which is practically finexhaustible as a resource.
' Furthermore, optical f%6re has a carrying capacity far in excess
� of conventional copper.
Optical fibre may be regarded as a second-generation tech-
� nology which could �enhance the St. Paul cable system. However,
there are two alternative technologies which may, indeed, replace
� cable.
� Subscription TV (STY�
One of the most popular features of cable TV is its offer-
� ing of first-run movies , sporting events and programming options
not currently available from broadcast media . Subscription TV
� or STV can offer these options without the expense of laying a
cable plant. The STV subscriber leases a scrambling device which
, may be attached to his home set allowing him to receive special
� TV signals from over-the-air transmissions . STV may, indeed,
present a competitive challenge to cable TV.
�
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, Satellite TV
Under available technology satellite transmission of broad-
� casts ls rece�ved 6y elaborate and expensive antennae called earth
� stati.ons. The eartt� stations are owned 6y cable compani`es and
broadcast stations. Tf an xnexpensive home antenna i.s developed,
, then dtrect-satellfte-to-ho�ne reception would be possi.ble. Such
a system would bypass the ca61e operator and give the home viewer
� access to much of tf�e programming currently offered by cable-
� satellite networks alone.
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�
�
RECQMM�NDATI�ONS
,
The F�^anchising Process
, 1. �e 6eli�eve that the weight of the evidence as presented
in the wri�tten documentati'on and 1n the ver6al-vi.sual presenta-
� tions defi:nitely suggests tFiat a ca61e television would enhance
� the quality of life in tfie ci'ty of St. Paul . F[e have found that
cable television would expand tfie recreational vistas of the
� gener�l publ1c. Tn addi�ti'on , We have found that a potential
market for ca61e servi,ces exists in tfie fields of educati.on , the
iarts, social service, government and 6usiness . Certainly there
� is no need for ca61e TY i'n the sense that i�umanity needs food,
jobs and shelter, but tFie City of St. Paul needs cable TV in the
� same sense that it needs theatres, libraries , parks and museums.
We need cable TV not to live 6ut to live life more abundantly.
, t�e, therefore, recommend that the City Council continue the
franchising process and seek the development of a cable communica-
� tions system.
� 2. We urge the City Council to retain a citizens advisory
committee throughout the franchising process to assist in the
� evaluation of the various applications and proposals.
3. We are of the opinion that the complexity of the fran-
� chising process may enta�l the need to retain a consultant and
, it is our recommendation that tfie Ci�ty Council seek such outside
expertise. Specifically, we urge that the Council seek assi:stance
� with the drafting of an Tnvi,tation for Applications and the
,
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� Muni.clpal Regulativn and xnvolyement
1. The ordi�nance s�ould make provision for a Cable Servi,ce
, Commission to be a ointed by the Mayor with the approval of the
Pp
� City Council . T�e Commission should 6e empowered to monitor the
development of tbe cable srstem, 0versee rdte adjustments , test
, the performance of the system and resolve consumer complaints .
A staff person sfiould 6e added to assist the Commissi.on in its
� work.
� 2. A regulatory ordi'nance failjng to provide sanctions for
violation of its terms would 6e worthless. The ult�mate sanction
, for a sufistant%al 6reach is revocation of the franchise. The City
should not find itself threatening the maximum penalty for minor
� infractions. The ordinance sfiauld provide for some flexibility
, in the enforcement of the franchise 6y setting a schedule of
penalties which might be levied where revocation is inappropriate.
� 3. A contract or franchise has yet to be written which is
not subject to good faith and honest misunderstanding and conflict.
, We do not wish to see the Ci'ty involved in interminable legal
squabbles . For this reason we recommend that the Council include
� an drbitration clause in the franchise ordinance binding the City
� and operator to an effective and inexpensive method of disputes
resolution.
� 4. The Committee recognizes that the interests of business
enterprise and social equity must be balanced in the adoption of
, a rates policy vis a vis ca61e televisi:on. The Committee is con-
� cerned that the ca61e franchi'se may so structure its rates as to
tend to the detriment of tFie low and fixed income households in
� the city of St. Paul . RCe urge that the City� adopt a rdtes policy
,
� z�
, providing for maximum public oversight and revi.ew in the inter-
, ests of the less privileged elements of the community, especially
in regard to access and educational chdnnels . However, the regu-
, lation of rates should not 6e so structured as to tend to diminish
the returns that reasonable investors might expect of thei.r
, capitai .
5. We do not believe that the private sector should be
� the only source of information relative to institutional uses of
� cable television or public service programming. Institutional
cable may have far-reac�ing consequences for the operation of
� local government and social services . �e wrge the City Council
to seek funding for a study of the feasibility of public tele-
� communications facilities .
� 6. �e recommend that the City Council direct the Police
and Fire Departments to cooperate with the cable franchise appli-
� cants to determine the feasibility of security-fire alarm systems
linked to cable. We believe that such a determination should be
, made prior to the award of the franchise.
1 System Design
1. The coaxial cable which carries entertainment from
� studio to home TY may also carry data or other forms of informa-
� tion from governmental agency to citizen, business to business ,
business to consumer, or schoql to school . Although the develop-
, ment of what is called i;nstitutional cable is in its infancy, we
believe that the potential serv1ces whic� could be offered
, justifies the City in seeking plans from ca61e franchi,se appli-
cants regardi.ng i�nstitutional cable. Such plans s�ould address
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! the use to which institutions may adapt to the originatlon dnd
, �ccess channels as well as the servl�ces which m�ght be offered
by a separate institutional cable sy�stem. Tf an instituti:onal
, cable system is proposed , tfien it should be connected to major
educational and cultural/arts users in dddition to com�ercial
, and governmental users.
Unfortunately, there is limited information available con-
� cern%ng institutional ca61e. �e would, therefore, expect and
� would 6e �illing to fiave the Cfity requ�re that the cable appli-
cants present the results of marketing studles of the potential
� use of such a system in the St. Paul area.
2. Tt is not enoug� to design a system with a two-way
, capability. We urge that the City seek a system which proposes
, an activated two-way channel or channels . The two-way or inter-
dctive design sfiould encompass both the home and institutional
, networks.
3. Two-way communications raise the spectre of violation
, of privacy. The City should solicit designs in which the privacy
of the subscriber is protected.
� 4. St. Paul often prides itself on being a city of neigh-
� bors and neighborhoods . We should seek a cab] e operator who will
act to encourage neighborhood communication and identification .
� Cable technology enables the "narrowcasting" of programming to
selected secti.ons of the c%ty. The City should seek a franchisee
, who has designed a narrowcasti�ng cdpa6ility into their system.
, 5. Aerial installation is the most cost-effecti:ve means
of constructing the initial cable service system. Nevertheless ,
, we should recognize that all utili'ties may eventually be placed
�
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� underground and the franchisee should be bound to place his cable
, in underground conduits in tandem with the schedules of the other
utilities . _
, 6. We realize that the State mandates the interconnection
of one channel in the metropolitan area . We do not believe that
, this is sufficient. We urge the City of St. Paul to take the
initiative to expand interconnection among the various munici-
� palities. At the very minimum, we recommend that the educational
� access channels and the institutional cable system be intercon-
nected.
� 7. A cable connection should be provided at no cost to all
educational and culturai institutions upon request.
� 8. We recommend that the City require fr:anchise applicants
� to submit information relative to their syste� design' s compati-
bility with computer programmed learning and information systems
, such as PLATO, VIEWDATA, VIEWTRON or SOURCE.
9. It is recommended that the City Council request in its
, Invitation for Application a cable systems design which provides
for a two-way, inter-active channel for lease at nominal rates
� to profit and non-profit organizations. The inter-active channel
� should be a part of the regular service provided to all customers
and should be capable of point to point, point to multipoint, and
� multipoint to multipoint communications.
, Local Community Programming and Access '
1 . We recommend that a nonprofit corporation be established
, serving the St. Paul community and governing the administration
and programming of the access channels. 7his corporation should
, be broadly representative of the various segments of the community
�
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, including the educational and arts/cultural users. The corporation
would relieve the cable system operator of the burden associated
, with the management of its access responsibilities and should be
, ailocated funds by the operator in lieu of a management fee for
this purpose. The City should also allocate a portion of its
, franchise fee equal to 3 percent of the gross revenues to the non-
profit corporation for community programming.
� 2. Adequate production facilities for studio and remote
origination including equipment and support staff should be made
, franchisee at no cost to educational and non rofit arts
by the P
� and cultural users.
3. We recommend that three channels be reserved for access
, use of education and the arts. These channel-s would serve the
, needs of primary and secondary education, higher education , com-_
munity education and the arts and cultural communities. We real
, ize that these channels might not necessarily be utilized by local
programming and for this reason propose that imported programming •
ishare these channels. Local programming would retain priority
, access.
4 In the event that a two or three tiered system is
, offered to the City, we recommend that all educational access
channels be provided on the lowest possible tier of service so
� that the cost does not deter subscribers from availing themselves
of the educational opportunities offered by cable. _
, We urge that the City Council give preference to those
applications which offer all subscribers the service of the
� public , educational and governmental access channels for the cost
, of installation alone.
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, 5. The City of St. Paul is a pluralistic society of many
different groups and communities reflecting diverse ethnic and
, cultural heritage. We suggest that program offerings be pre-
, sented with these diverse audiences in mind. In particular, our
black, Native American and Hispanic communities should have the
� availability of special interest programming on a regular basis.
6. Special groups have special needs , and the needs of the
, visually impaired may be served through talking-book programming
, and the needs of the hearing-impaired may be served through
captioned programming. The cable franchisee should plan for these
, audiences.
7. We propose that the City and the cable operator seek to
, develop a number of locations at libraries , schools or community
centers where the public can view or participate in the use of
, the access channe.ls. These "neighborhood information centers"
, may serve as the nucleus for community video access .
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