HomeMy Public PortalAbout19810413 special 1.0 0
SPECIAL COUNCIL MEETING Aril 13 1981
Mayor Protem Hequembourg presided and read the Call for the
Special Meeting, which includes the following:
Introduction of Salary range reclassification
Ordinance for the position of City Counselor.
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Resolution retaining Chris Graham as Special Counsel
for Cable Television, beginning April 22 , 1981.
Presentations by the bidders for Cable Television
Franchise.
Councilmen present : Borgmeyer, Brant , Gordon, Halsey, Hequembourg Roll
Kliegel, Prenger, Wade and Whitecotton. Call.
Councilman absent : Crader, absent with leave.
A quorum was declared present.
Bill No. 227, introduced by Councilman Whitecotton, entitled:
"An Ordinance of the City of Jefferson , Missouri , amending Bill 227
Ordinance No. 9576 , by the deletion of the existing Section 1 of City
` $ said Ordinance and the substitution therefor of a new Section 1. " Counselor
Bill No. 227 read first and second time by title and ordere. Position.
>t. distributed to members of the Council.
The following Resolution, which had been introduced and passed at
a previous Council Meeting, was reintroduced for lack of signature Resolu-
of a Presiding Officer. Mayor Hartsfield was presiding at the tion
time of such approval by the Council and since it was not proper Cable
for him to sign the same in view of his withdrawal from all Cable TV
Television matters, and since Mayor Pro tem Hequembourg was absent
from the meeting, this Resolution was reintroduced:
R E S O L U T I O N
RESOLVED, that on April 22 , 1981 , Chris Graham be retained as
special counsel for cable television to represent the City of
Jefferson in the litigation styled "T. C. I . CABLEVISION INC. vs.
THE CITY OF JEFFERSON , MISSOURI" .
Agreed upon rate: Attorney 's time - $50. 00 per hour not to excee
One Thousand Two Hundred Dollars ($1 ,200.00)
por month, plus out-of-pocket expenses.
Itemized statements shall be submitted at each regular Council
Meeting.
ADOPTED THIS 13th day of April , 1981.
ATTEST: Libby Tihen, City Clerk John He uembour, Ma or Pro Tem
Councilman Halsey made the motion that such Resolution be adopted.
Motion seconded by Councilman Prenger and passed.
Barry Babcock, Vice President of Teltran , Inc. , appeared and pre-
sented the Council with responses to questions posed to Teltran Presenta-
and to Central Telecommunications, Inc. Mr. Babcock introduced tion
Robert Brooks , President of Teltran ; Jim Allen, Vice-President of Teltran
Operations; and J. C. Daniels, Manager of Teltran ' s Columbia syste
Mr. Babcock stated Teltran has a sincere and honest desire
to serve the residents of the City of Jefferson. Teltran has a
number of cable operations in the State of Missouri. They are
the largest system operator in Missouri. In his opinion, the most
important provision of service to Jefferson City is the fact that I
Teltran does have a cable system in Columbia. They have proposed
these two systems be integrated together, there be a technical
plant which would enable Teltran to share programming and to shar_.
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SPECIAL COUNCIL MEETING, April 131 1981
resources with the system in Columbia. Teltran has proposed a
400 MH system, 52 channels. Two way from day ono , all trunk and
all feeder cables are two way activated from the first day of
operation. Teltran will be providing addressable converters for
all homes who need converter service. These permit the cable
company, from the head end side, to instruct the converter as to
what channels are available to that household as far as pay service . °:
and options which the subscriber chooses to take. The advantage r.
of addressable converters is that it considerably cuts down on
maintenance and phone calls required using a normal converter.
Teltran has proposed an institutional network which provides 22
Teltran channels downstream, 17 channels upstream. This means there is a
Presen- large capacity of channels in both directions which enable institu-
tation. tions to communicate among themselves and also with subscribers. +,^
The broadcast stations and independent stations proposed by Teltran
are those stations which are currently permitted by the FCC. No
other stations in those two categories are permitted to be carried yi
in Jefferson City at this time.
The only service Teltran chose not to immediately show is3,
cable news network. However, that service will be added in the ry
future. It is a very expensive service , the most expensive service
available in cable television at the present time for basic service
Teltran is proposing three things : 1) equipment to be used ='
in City Hall or in other locations which the City desires to enable
the City to provide live programming of events 2) providing mobil
production equipment which will enable live broadcast of events ^
anywhere in the City, and 3) to provide a fully equiped local
origination studio at Teltran ' s facilities.
Concerning the rate freeze guarantee , there are a number of
uncertainties associated with the awarding of a cable television
franchise in Jefferson City. Because of those uncertainties ,
Teltran felt the timing of an award to Jefferson City Cablevision
is unsure. They felt it was only prudent that they make the commen
to the City that they would not agree to freeze the rates until
they knew whon the effective date of the franchise grant would be.
If It were to be three years down the road, they have to contend
with inflation , increased labor rates and equipment costs that
go up every year. They didn ' t feel they could put themselves in
that position. They did say that as soon as the questions are re-
solved , they wt li agree to a rate freezes guarantee - they have no
objections to the principle of the rate freeze guarantee , in fact , a
they agree to it in every conuntinity they are in. It is just a
question of timing.
TCI Haul Alden , representing TCI , appeared before the Council . He S
Presenta.1 stated that what they present to the Council by film they intend
tion. to install . He stated Teltran submitted a proposal that rises or
falls on the purchase of the Tel system. Mr. Alden stated the TCI
system is not for sale, now or never.
Mr. Joseph Stern , of Stern Telecommunication Corporation ,
appeared and presented an evaluation to the Council . TCI had
employed Stern Telecommunications Corporation to evaluate the
three proposals using the identical judgmental categories utilized
by Mr. Smalling, of Jenel Corporation.
A film was then shown to the Council. The film stated TCI
was going to install a state of the art vastly improved system for
supplying cable television service in the Jefferson City market .
TCI will continue to provide subscribers with the present 11 channel
isystem while expanding the existing system. TCI will provide con-
verters so that subscribers will have the option of expanding their
service to 20 channels initially within 5 months and to 74 channels
with 2 way capability within 20 months. TCI will offer this servic :
to all new areas of the City as they reach a density of 30 homes
per cable mile. TCI will provide a free drop and basic cable i!
service to the following institutions in Jefferson City : schools ,
hospitals, county buildings, city buildings and libraries. TCI
will provide a fully equiped studio, mobile van, portable video
and channel space for the use of all Jefferson City residents.
Councilman Hequembourg asked TCI why they were here to make
a presentation if they were not interested in being regulated by
the City under the present terms.
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SPECIAL COUNCIL MEETING, April 13, 1981
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Mr. Farrow replied "it has not been the position of TCI that
the City has no right to regulation . What the dispute concerns is
the extent of that regulation" .
Councilman Brant asked Chris Graham, City Attorney, if we
were requiring a performance bond to insure that promises made by
the company awarded the franchise were kept . Mr. Graham replied
there was a performance letter of credit specified with a suggeste'
series of civil penalties for various violations. This is propose'
rather than a performance bond as it is easier to attach the lette
of credit than it would be to sue under the performance bond.
Councilman Brant then asked TCI if, once the lawsuit is settled an'
they were awarded the franchise, would TCI be willing to go along
with the performance bond? Mr. Farrow replied that TCI is always
willing to back up its commitments. TCI is willing to commit
itself and live up to its commitments.
Gene Bushman, representing Central Telecommunications, Inc. then
h appeared before the Council. Central Telecommunications, Inc. , CTI
(hereinafter referred to as CTI ) will purchase the best wire and
Presenta-
equipment that can be used for their system. Scientific Atlanta tion .
will design, build and test the equipment and, when it is working
perfectly, they will turn it over to CTI .
John Schott , of Kansas City, Missouri , of CTI , then appeared
before the Council. He stated that the present system in Jefferso
City can not be upgraded. CTI would come in and put in all new
equipment and build up a reasonable amount of different programmin. .
Mr. Bushman then distributed a handout to the Council . This
handout compared the programming and rates of Teltran and CTI .
Tier 1 - Teltran does not have a converter so you are limited
to the 11 channels. The report shows the additional programming C ►I
is offering in Tier I and CTI is $. 55 a month cheaper plus , with
the extra outlet , there is an additional savings of $1 .25. CTI
guarantees no rate increase for three years.
Tier II - There is not a significant variance between Teltran
and CTI until you got to Stock Market.. Ticker Tape. All the
additional programming which CTI will offer costs money. CTI
estimates that if Teltran chose to duplicate CTI and offer the
same equivalent programming , they would be asking for a $2 .00 a
month rate increase. On the movie channels , CTI is offering 1113O
$1. 00 a month cheaper. The other movie channels are being offered
at either $1 . 50 or $2. 00 cheaper. He points out there would be a
considerable savings in the event a customer would choose more that
one pay tv. I f a customer would choose two, three or four of thee ,
ho would save $1.00 per month for each additional pay tv. The sub
scribers can save as much as $2. 50 through $7.00 per month under
CTI 's arrangement . CTI will offer twice an many FM stations as
Teltran and that service will be offered for considerably less.
All of the shareholders of the corporation are either long time
residents of Jefferson City or will be moving to Jefferson City.
The engineers and technicians who will be operating the system
will be moving to Jefferson City , providing a value to the citizen.
of Jefferson City to have immediate and ready access to the people '
who run the cable system.
CTI has a plan to create local origination and then to help
it grow. CTI ' s tower will be located on Lincoln University campus
The head in will be located there also, preferably adjacent to the
old lab school. Lincoln is going to convert the old lab school
into the new mass communications department . Lincoln will put in
some equipment with CTI 's assistance, both monetarily and techni-
cally, and the studio will be located there. CTI will fully equip
a very extensive mobile studio van which will be used for local
origination programming, either live telecasting or for tape pur-
poses and through the system at a later time. That will be turned
over to Lincoln University. They will coordinate the programming.
CTI will not go into the broadcasting business but will assist the
expertise which is already here in town to get involved and to
i develop their natural abilities and to develop the local origina-
tion. CTI will assist the public schools in establishing a voca-
tional program at the Nichols Career Center. CTI will assist in
developing a burglar, fire and medical alert system for all homes
in Jefferson City. CTI will not compete with local business but
will help them develop new technology. The business will make a
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SPECIAL COUNCIL MEETING A•ril 13 1981
financial investment to permit all homes that have cable television
to have burglar, fire and medical alert protection . ;.,
Mr. Bushman asked that if CTI gets the franchise, regardless
' of what TCI does, and if TCI is still in business, that Council
suspend the heavy restrictions CTI has obligated itself to so long
as TCI is in business. Once TCI is out of business , then you can
reimpose the restrictions and CTI 'will come through on each promise
they have made. The only promise that CTI would have to ask some
leave way on is the promise of building the system within a specifi.=d
period of time.
Notice Councilman Hequembourg stated there would be a public hearing
of on April 20, 1981, for the purpose of the general public to ask
Hearing. questions of the three bidders.
Meeting adjourned.
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