HomeMy WebLinkAboutAGENDA REPORT 1998 1216 CC REG ITEM 09C3� ./I
ITEM �o
CITY OF MO0RR,1kRK, CALIFORNIA
City Council Meeting
of 12 . 1(, -9 -6
ACTION: COnkinued 4
1- 2.o-19
MOORPARK CITY COUNCIL
AGENDA REPORT
TO: Honorable City Council
FROM: John E. Nowak, Assistant City Manager -==�
DATE: 04 December 1998 (Council Meeting of December 16,
1998)
SUBJECT: Consider Resolution No. 98- Approving a Change
of Control of the Cable Communications Franchise
held by TCI Cablevision of California, Inc.
BACKGROUND: In March 1996 the City Council approved
transferring a cable television franchise to Tele-
Communications, Inc. of Ventura County (TCI) which is a
part of TCI Cablevision of California, Inc. The national
parent company, Tele- Communications, Inc., is planning to
merge with AT &T. The City's approval is required for the
new company to assume the franchise in Moorpark.
DISCUSSION: TCI of Ventura County currently holds a
franchise to provide cable television service in the City
of Moorpark. In June 1998 the parent company of TCI agreed
to a merger with AT &T which would create a new wholly owned
subsidiary of AT &T that would operate the cable television
franchises. Section 5.06.312 of the Moorpark Municipal
Code requires the City's consent for any change in control
of a franchise prior to the change in control occurring
(see attached) .
TCI and AT &T have provided the City with Federal
Communications Commission's Form 394 detailing the status
of the two companies and the new structure that will
operate the cable television franchises. TCI will pay for
related administrative costs incurred by the City in
oocjz o
TCI /AT &T Merger
Meeting of 16 December 1998
Page 02
reviewing this change of control request. TCI has also
agreed to pay $25,000 as a franchise transfer fee. This is
similar to the fee requirement in the Entertainment Express
Ltd. extension resolution and as obtained from refuse
franchise change of control.
Resolution No. 98- gives the City's approval for the
change of control resulting from the merger. This action
does not affect any other condition or requirement of the
current franchise held by TCI, which expires on December
20, 2000.
This matter has been noticed for a public hearing at this
time. It was advertised in the local newspaper and
appeared on TCI's channels 8 and 10, and on the City
website.
STAFF RECOMMENDATION: That the City Council adopt
Resolution No. 98- approving a change of control of the
Cable Communications franchise held by TCI Cablevision of
California, Inc.
Attached: Resolution No. 98-
Municipal Code Section 5.06.312
0002(
RESOLUTION NO. 98-
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
MOORPARK, CALIFORNIA, APPROVING THE CHANGE OF
CONTROL OF THE CABLE COMMUNICATIONS FRANCHISE
HELD BY TCI CABLEVISION OF CALIFORNIA, INC.
WHEREAS, TCI Cablevision of California, Inc. through
TCI of Ventura County (here inafter "Franchisee ") is duly
authorized to operate and maintain a cable communications
system in Moorpark, California (hereinafter the "System ")
by the City of Moorpark (hereinafter "Franchise Authority ")
pursuant to a franchise (hereinafter "Franchise ") granted
by the Franchise Authority in March 1996; and
WHEREAS, pursuant to the Agreement and Plan of
Restructuring and Merger among AT &T Corporation
(hereinafter "AT &T "), a newly formed wholly owned
subsidiary of AT &T (hereinafter "Merger Sub "), and Tele-
communications, Inc., the parent of Franchisee (hereinafter
"TCI "), dated as of June 23, 1998 (hereinafter "Merger
Agreement ") , Merger Sub will merge with and into TCI with
TCI as the surviving corporation in the merger, and as a
result of the transactions contemplated by the Merger
Agreement, TCI will become a wholly owned subsidiary of
AT &T (hereinafter "Transactions "); and
WHEREAS, Franchisee will continue to hold the
Franchise after consummation of the Transactions between
AT &T and TCI; and
WHEREAS, Federal Communication Commission's Form 394
with respect to the Transactions has been filed with the
Franchise Authority; and
WHEREAS, Section 5.06.312 of the Moorpark Municipal
Code requires the City's consent for any change in control
of a franchise prior to the change in control occurring;
and
WHEREAS, TCI has agreed to pay related administrative
costs incurred by the City in preparation and review of
this change in control request; and
LOG2()
Resolution No. 98-
Page 2
WHEREAS, TCI has agreed to pay a "Franchise Transfer
Fee" in the amount of $25,000 as part of the request for
change of control; and
WHEREAS, TCI and AT &T have requested consent by the
Franchise Authority to the Transactions;
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF
MOORPARK DOES HEREBY RESOLVE AS FOLLOWS:
SECTION 1. The Franchise Authority hereby consents
to and approves a change in control of the Franchise as a
result of the Transactions to the extent such consent is
required by the terms of the Franchise and the Moorpark
Municipal Code.
SECTION 2. That a Franchise Transfer Fee of
$25,000 shall be due and payable upon the adoption of this
resolution.
SECTION 2. This Resolution shall become effective
upon its adoption.
SECTION 3. The City Clerk shall certify to the
adoption of this resolution and shall cause a certified
resolution to be filed in the book of original Resolutions.
PASSED AND ADOPTED this 16th day of December 1998.
ATTEST:
Deborah S. Traffenstedt, City Clerk
Patrick Hunter, Mayor
5.06.310
5.06.310 Franchise nontransferrable.
A. Except as otherwise provided in the franchise
ordinance, the franchise shall not be transferred, sold,
hypothecated, sublet or assigned, nor shall any of the rights
or privileges therein be hypothecated, leased, assigned,
sold or transferred, either in whole or in part, nor title there-
to, either legal or equitable, or any right, interest or property
therein, pass to or vest in any person, except the grantee,
either by act of the grantee or by operation of law, without
the prior consent of the city expressed by resolution.
Nothing set forth in this chapter prevents the grantee from
leasing or otherwise allocating use of any channel or pro-
gramming time to any person, whether over a commercial
use channel, local origination channel or otherwise.
B. If the grantee transfers the franchise prior to obtain-
ing city consent, twenty-five percent (25 %) of the gross
revenues of the cable television system from the date of
franchise transfer until the date of city consent shall be
returned to the system's subscribers, on a per- capita basis.
C. The city may not unreasonably withhold its consent
to a franchise transfer. For the purpose of determining
whether it consents to such change, transfer, or change
in control, city may inquire into the qualifications of the
prospective transferee or controlling party, and grantee shall
assist city in any such inquiry. In seeking city's consent
to any change of ownership or control, grantee shall have
the responsibility of insuring that transferee completes an
application in form and substance reasonably satisfactory
to city, which application shall be submitted pursuant to
Section 5.06.320 of this chapter. An application shall be
submitted to city not less than ninety (90) days prior to
the date of transfer. The grantee shall be required to estab-
lish that it is in material compliance with its franchise. The
transferee shall be required to establish that it possesses
the qualifications and financial and technical capability
to operate and maintain the system and comply with all
franchise requirements for the remainder of the term of
the franchise. If the city finds that the legal, financial,
character, technical and other public interest qualities of
the applicant are satisfactory, and that the proposed
transferee has the capability to operate and maintain the
system and comply with all franchise requirements for the
then remaining term thereof, the city shall transfer and
assign the rights and obligations of such franchise. The
city may condition the transfer to insure the transferee is
in material compliance, and remains in material compliance
with, the franchise. (Ord. 133 § 1 (part), 1990)
5.06.312 Change in control.
A. City consent is further required for any change in
control of grantee, pursuant to subsection 5.06.3 10 above.
"Change of control" means any sale, transfer or acquisition
70
of grantee, grantee's parent, the parent of grantee's parent,
etc. If grantee or its parent(s) is a corporation, any acquisi-
tion of more than 10% of grantee's voting stock by a person
or group of persons acting in concert, whom already own
less than 50% of the voting stock, is deemed a change in
control.
B. Any change of control of the grantee occurring
without prior city approval shall constitute a material breach
of the franchise. (Ord. 133 § 1 (part), 1990)
5.06.314 Franchise area — Annexations.
A. The franchise ordinance shall establish the franchise
area.
B. Territory annexed to the city which is not within
the franchise area of an existing franchise may be added
to an existing franchise pursuant to council resolution adopt-
ed after conducting a noticed public hearing, provided that
such new territory shall be deemed a part of the franchise
area of any grantee authorized to serve the entire geographic
area of the city without action by the council. (Ord. 133
§ 1 (part), 1990)
C. Territory annexed to the city that is already covered
by an existing franchise or license granted by another public
entity but where the grantee of such franchise or license
has not commenced installation of a cable television system
in the area of such annexed territory shall be deemed not
to be served by a franchise or license, and all rights ac-
quired under said franchise or license in the area of such
annexed territory shall terminate by operation of law as
of the effective date of the annexation.
D. Territory annexed to the city that is already served
by a franchise or license issued by another public entity,
may continue to be served by the grantee under said fran-
chise or license for the balance of the term of said franchise
or license, subject to the provisions of said franchise or
license and the provisions of this chapter, and provided
the franchise fees, which the city may establish by resolu-
tion up to the maximum permitted by law, are paid. (Ord.
133 § 1 (part), 1990)
5.06.316 Franchise applications.
A. Any person may apply for the grant of a new
franchise.
B. The city may, by advertisement or any other means,
solicit applications for new franchises pursuant to a request
for proposals.
C. Upon receipt of an application, the city manager
shall cause to be prepared a report, including his recom-
mendations respecting such application, which shall be
filed with the council and each applicant. Upon receipt
of said report, a public hearing shall be noticed to consider
the approval of the application.
ZUNI ui• IZ-10-00 + a -%arm ? lul OR MY. vrFILL' OUO OZU 6VU;g Z/ E
TC1
December 16, 1998
Mr. John Nowak
City of Moorpark
799 Moorpark Avenue
Moorpark, CA 93021
RE: City of Moorpark
TCUAT &T Merger
FCC Form 394
Dear Mr. Nowak:
Sent Via Fax and UPS Overnight
T-L-crm
C C m
This letter is to confirm that TCI and AT &T agree to extend the period to January 20,
1999, for the City of Moorpark's review of the application for the change of control.
TCI and AT &T hereby waive any and all claims that they may have that any denial of the
application at the January 20, 1999 hearing fails to satisfy the deadlines established by
Federal law.
If you have any questions, please contact Susie Evans at 925- 927 -7026 or myself at 925-
927 -7054.
Sincerely,
Mari ackson
Franchise Administrator
West Division Office
Cc: Susie Evans
Madie Gustafson
RECEIVED
DEC 1 R 1998
City of Moorpark
Administrative Services Department
ra West Diviaon
-%tuft Arm —rt, C #0tWA 8 N86-&d.
1650 MI. DiQUO 51YU.. Suite 200
Welnul Creek, CA 94596
(510) sws-am
FAX (S 10) 927.7015
An EOVaf ODOarruAAy C"A"r
DEC 16 '99 16 oe 5109BBB63A aar,F n