HomeMy WebLinkAbout2002 Resolution No. 057• RESOLUTION N0 .,52
SERIES OF 2002
•
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ENGLEWOOD,
COLORADO , CONSENTING TO THE TRANSFER OF CONTROL OF THE CITY'S CABLE
TELEVISION SYSTEM FRANCHISE TO AT&T COMCAST CORP
WHEREAS , on April 7, 1980, the City of Englewood, Colorado f'City") granted to
Mountain States Video C'Franchiaee"), a franchise to own and operate a cable television
system in the City of Englewood as set forth by the passage of Ordinance No . 4, Seriea of
1980; and
WHEREAS , the Franchisee is a subsidiary of and controlled by AT&T Corp ., a New York
corporation C'AT&'I"'); and
WHEREAS , Section 23 of the Franchise requires the City's consent ·to any transfer of
ownerahip or control the11,of; and
WHEREAS , AT&T and Comcast Corporation, a Pennsylva nia corporation f'Comcaat"),
together with AT&T Broadband Corp . and certain of their respective affiliates have entered
into an Agreement and Plan of Merger and AT&T and AT&T Broadband Corp. have entered
into a Separation and Distribution Agreement, both dated December 19, 2001 C'Merger
Agreement"), to create• new company to be known as AT&T Comcast Corporation C'AT&T
Comcast"); and
WHEREAS, this merger will effect a change of control of AT&T and Franchisee pursuant
to the Franchise; and
WHEREAS, pursuant tc Section 23 of the Franchise, .nd 47 U.S.C. Sec. 537, as
amended, AT&T and Comcast have requested that the City approve of the transfer of
control of the Franchisee from AT&T to AT&T Comcast; and
WHEREAS , the City has investigated both the status of the Franchise, the Franchisee's
compliance therewith and the technical, legal and financial ability of AT&T Comcast to
control the Franchisee's compliance with the Franchise; and
WHEREAS, through the Greater Metro Telecommunications Co .. sortium C'GMTC"), the
City has negotiated this form of resolution to approve the transfer of control in a manner
consistent with the approvals being granted by moat GMTC jurisdictions ; and
WHEREAS, based upon the City's investigation and repres entations made to the City by
AT&T and Comcast, upon which the City is relying, the City is prepared to approve the
transfer of control of the Franchisee from AT&T to AT&T Comcast, pursuant to the
conditions described herein;
NOW, THEREFORE , BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
ENGLEWOOD, COLORADO, THAT:
Si:wwu. The City Council of the City of Englewood , Colorado hereby consente to a nd
approves the transfer of control of the Franchise from AT&T to AT&T Comcast .
5w:tiim..2. The r:ity of Englewood confirms that the form er Franchiee wae in full force and
effect when the re quest for the transfer of control was received and a new Franchise has
been approved, which became effective June 10, 2002.
~-This ReBOlution approving the trenefer of control ie baeed in part upon the
following repreeentetione and ecknowledgmente made by Franchieee, AT&T and AT&T
Comcast to the City, ell of which ere coneidered materiel end have been relied upon by the
City of Englewood :
A. That the Merger Agreement and all of the attachments to that document,
provided to the City of Englewood with FCC Form 394 (except for those
material• which have been redacted pureuent to law and are identified by
title or topic in the Merger Agreement end its attechmente) conetitutee the
entire agreement regarding the merger between AT&T, AT&T Bro adband
and Comcast:
B. That all cuetomer service standards adopted by the City remain in full forc e
and effect and Franchisee will maintain staffing levels necessary to meet
thoee etanderds end ell fede r al regulations regarcling technical etenderds of
cable systems;
C. That Franchisee remeine obligated to comply with ell lawful terme,
conclitions end obligations of the existing franchise agreement end any other
existing contractual agreement between the Franchieee and t he City;
D. That AT&T Comcaet will take no actions that will negatively impact
Frenchieee's a bility to comply with its obligatione under the Frenchiee;
E. That no future intra--corporate transfers, mergers, or other ch--nges of
ownership or control, affecting Franchisee, will change the obligations or
liability of Franchisee to the City with respect to any of the terme, conclitions
end obligations of the Franchise, unlees prior a pproval is granted by the City
in writing;
F. That Franchisee will comply with all applicable laws regarding ratee for
cable services within the Franchise area end ell applicable laws covering
issues of cross subsidization:
G. That during the term of the Franchise end any e,sension thereto, Frenchieee
will continue to pay franchise fees on gross r1venuee generated by sal e of
cable services, regard.less of how cable services and non•cable services may be
bundled together end BOid to subscribers. Franchisee shell not take any
action to evade or avoid payment of franchise fees based upon the reasonable
value of the revenues received for cable services from paying Yubscribers. The
City end Franchisee continue to reserve ell ri.~hts, claims, defenses end
remedies regarding the City's authority to impco • ~ncl/or enforce
requirements related to the reveouf.' allocation methodology to be used when
cable services end non-cable services ere bundled together for the purpose of
calculating franchise fees .
•
•
•
• H. That in the event of any failure to comply with the terms, conditions,
representations end/or acknowledgments contained in this Resolution, 01· any
material misrepresentations concerning the some , the City may enforce any
damages or pennlty provisions pursuant to the Franch.ise and exercise any
other remedy available to it by law .
~. By passage of this Resolution, the City mak es no representations conce rning
whether any violations or non-compliance isu ues exist with respect to the Franchise .
Nothing in this Resolution sh a ll be constr"ed hy the Franchisee, AT&T , or AT&T Comcast
as precluding the City from addressing •ny I rior acts of noncompliance by Franchisee,
pursuant to the terms of the Frmr· ise .
Siu.tismJi , This Reso lution shall •~ k e effect upon the closing of the Merger Agreement.
~. Thi s Resolution is r.o:id ;ti0,11d upon approval of the transaction between
AT&T, Comcast and AT&T Comcas i , by their respective s harehold ers and all required
federal government agencie s, in substa nti ally the same form as the transaction described in
the Merger Agreement nnd related documents delivered to the City with AT&T's and
Comcast'e Form 394 filing and in documents delive red in response to the City's requests for
s upplemental information. Should the transactioo as approved b1• the shareholders and
federal government agencies diffor in any material respect ~i.m~ iha~ : · 1-:resented in the
documents described herein , this Resolution shall be voidob1 r &t ~-• 9<.'e option of the City .
~-Within thirty (30) days foll owing the ado pti•,u < f thi•. !!.eso lution, Franchist3
and AT&T Comca s t s hall give written notice to the City that it unconditi ona lly agrees with
a od shall be bound by all terms contained in this Resolution.
~-Within thirty (30) days following the closing of the Merger Agreement,
Fra .. ..:nisec shall file with the City a written representation that the above condition s have
l>een met .
ADOPTED AND AP'.'ROVED this 17th of June 2002 .
I, Loucrishia A. Ellis, City Clerk fo~ City of Englewood o
a bove is a true copy of Resolution No.;Lf Series of 200 .
• COUNCIL COMMUNICATION
I
Agenda Item I Subj~<:!
Tr ansfer of Co ntrol: AT&T
Jun e t 7, 2002 1 t c i Comca st M erger 1------'------'-------L----c··
Date
Initiated By I s•.~/f Source
City M anage r's O ffice D an Brotzman, Ci ty Attorney
._ _________________ _,_ __ L_e_i,=--.gh Ann Hoffhines, Ci ty M anager's O ffice
COUNCIL GOAL AND PREVIOUS COUNCIL ACTIOllo
196i · O rd . No. 33, auth ori zing a Cabl e Telev isi on Permit w ith Mountai n States Vid eo
1973 • O rd . N o. 26, auth ori zing a Ca bl e Tele vision Perm it with M o untai n Stat es Vid eo
1980 -O rd . N o. 4, autho ri zing a Cabl e Te lev ision Permit w ith Mountain Stat es Video (TCI)
1992 •O rd .No. 37, auth ori zin g costs incurred in ca bl e fr •nchise negoti ations
1992 -O rd . No. 38, auth orizin g an In tergovernm ental Agreement w ith Grea ter M etro Cable Conso rtium
to deve lop a M odel Fran chi se Agree m ent
1994 -O rd . N o. 68, adopti on of Cust om er Servi ce Standards for Cable O perato rs
1995 -Ord. N o. 26, auth orizing an ex tens ion of th e c urrent Cabl e Telev ision Syst em Permit on a m onth-
to-m onth basi s
1999 -Reso lution trans fe rrin g control of th e City's Ca bl e Televisio n Sys :em Franci,ise to AT&T
Cor porati on
2002 -O rd . N o. 19, approvin g a Ca bl e Televis ion Fr anchi se Agreem ent w ith AT&T Broadband M ountain
Sta tes Video, LL C
City Coun cil dis c usse d th e p rop ose d r,·,olution du rin g the Jun ,. 3, 2002 Study Sess io n . Th e m ost rec ent
cable franchis e ag ree m ent w ith AT&T Broa dband M ountain Sta,es Video, LL C. becam e effec tive June 10,
200 2, but beca use the Requ es t for Co ns ent for Trans fe r of Control w as received w hile :he form er fran c his e
was in effec t, we are proceeding under th e term s of th e fo rmer agree m ent.
RECOMMENDED ACTION
St aff see ks Coun ci l suppo rt fo r a ,~so lution cons enting to th e Trans fe r of Control of th e City's Cabl e
Telev ision System F:a nchise to AT&T Comcas t Corporati on.
BACKGROUND, ANALYS IS, AND ALTERNATIVES IDENTIFIED
In ea rl y March , th e City rece ive d a "Requ es t fo r Conse nt to Change of Control" regardi ng th e p rop ose d
merge r of AT&T Broadban d and Comcas t Corp ora ti o n. Engl ewood's Cable Televis io n Fra nchise
Agreem ent requires City Co un cil's approval of th e change of co ntrol result ing from th e prop osed
transac ti on. Th e Ci ty has 120 da ys (until Jul y 3, 2002) to take acti on on th e requ es t.
On b ehalf of its :,iemb er jurisdic ti ons, in cludin g Englewood, the Grea ter Metro Te lecommunica tions
Conso rt ium (G Ml '.:) has reviewed th e me rge r agree m ent and th e abili ty of Comca st to comply with th e
tec hn ical, lega l, a•,d finand al obligati ons of local fr anc hi se agre em ents. Based on the find ings , th e GMTC's
Lega l Couns .,I, Ke n Fellm,n, ha s deve loped a m odel reso luti on approvi ng th e transfer of co ntro l.
Englewood's p rop os ed resoluti on is based on th e GMTC's model, and stipul at es seve ral conditio ns ,
in cl udi ng:
comp lia nce wi th all existing franchise obligati ons ;
comp lianc e with th e Customer Service Stand ard s adopte d by all GMTC co mmunir ;es;
maint enan ce of necessary staffing levels to mee t tho se standards, and compliance with all federal •
re gulat ions regarding techni ca l standards of cable systems;
co mpli ance wi th all applicable laws regarding rat es for cable services .
Th e mod el resol uti on has been approved by AT&T Br oadba nd . The reso luti on w ill take effec t upon th e
closing of th e Merger agreement, and is condit ioned up on approva l by th e respective shareholders and all
requi red federal government agencies .
FINANCIAL IMPACT
Th ere is no direct fi nanci al impact as a res ult of th is reso luti on.
UST OF ATTACHMENTS
Pro posed f.esolution