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Executive Summary Meeting: Study session Meeting date: September 14, 2020 Written report: 7 Executive summary Title: Comcast franchise renewal update Recommended action: **Due to the COVID-19 emergency declaration, this item is considered essential business and is Categorized as Time-Sensitive** • The report is presented for information only. No action is required. Policy consideration: Is the progress on the franchise renewal in keeping with council expectations? Summary: The city’s current franchise agreement with Comcast expires in January 2021. Upon receipt of Comcast’s request to renew its cable franchise in the city, the city notified Comcast of its intent to conduct informal renewal negotiations in accordance with the federal Cable Act. To prepare for negotiations, the city evaluated Comcast’s past performance under the existing franchise and conducted a needs assessment to determine the future cable-related Public- Educational-Government (PEG) community needs and interests of the city. This is the criteria prescribed by the Cable Act. Following the conclusion of the needs assessment, the city’s cable franchise attorney developed a draft franchise agreement, which the city plans to submit to Comcast for consideration. Financial or budget considerations: The final franchise agreement will determine the franchise fee, based on a percentage of gross revenues derived from cable service and PEG (public- educational-government) capital funding to be received by the city over the next franchise term, expected to be 10 years. Strategic priority consideration: St. Louis Park is committed to creating opportunities to build social capital through community engagement. Supporting documents: Community needs assessment report and appendices October 28, 2019 council study session report Prepared by: Jacque Smith, communications and marketing manager Reviewed by: Clint Pires, chief information officer Brian Grogan, attorney at law, Moss & Barnett Approved by: Tom Harmening, city manager Study session meeting of Sept. 14, 2020 (Item No. 7) Title: Comcast franchise renewal update Page 2 Study session meeting of September 14, 2020 (Item No. 7) Page 2 Title: Comcast franchise renewal update Discussion Background: The city’s current franchise agreement with Comcast expires in January 2021. Upon receipt of Comcast’s request to renew its cable franchise in the city, the city notified Comcast of its intent to conduct informal renewal negotiations in accordance with the federal Cable Act. To prepare for negotiations, the city evaluated Comcast’s past performance under the existing franchise and conducted a needs assessment to determine the future cable-related Public-Educational-Government (PEG) community needs and interests of the city. This is the criteria prescribed by the Cable Act. Present considerations: The city retained The Buske Group to prepare the needs assessment, which was undertaken from August 2019 through May 2020. The final needs assessment report, attached, includes summaries of the following: • Review of documentation related to the current Comcast franchise agreement. • Tour of city cable facilities and inventory of all equipment purchased with revenue derived from the franchise fee and PEG fees under the existing franchise with Comcast. • Community leader/stakeholder meeting in November 2019, attended by 18 participants. • Three in-person focus groups in January 2020, attended by 54 participants. • An online survey available from late January through March 2020, with 536 respondents. • A final report with results of the inventory, focus groups and survey, along with a summary of the needs and interests of the community. Input from community meetings and the focus groups, as well as from the research conducted by The Buske Group, resulted in several recommendations. Many of those have been incorporated into the initial draft franchise agreement that will be submitted to Comcast for consideration, including points related to the ever-important issues of customer service and viewer access. Most notably in the draft franchise agreement, the city is seeking to increase the amount of PEG capital support. This increase will help ensure ongoing equipment replacement for existing PEG functions as well as to help provide initial investment for a new community media center, which was identified as a strong interest by community members who participated in the needs assessment. A community media center would provide significant elements not currently available in the ParkTV inventory, with special digital media services and training developed to meet the needs of the community and to lessen the digital divide by providing training and resources to everyone including the BIPOC community, youth, senior citizens and persons with disabilities. FCC 621 Order update In September 2019, the Federal Communications Commission (FCC) issued an Order known as the “621 Order.” The 621 Order took effect with the potential to significantly reduce franchise fee and public, educational and government (PEG) fee revenue received by cities from cable operators. The city has not yet been contacted by current cable franchisees regarding any changes to the expected franchise payments as a result of the 621 Order. In October 2019, a petition for review was filed in federal court (Sixth Circuit Court of Appeals) seeking review of the 621 Order on the grounds that the 621 Order is arbitrary and capricious, violates federal Study session meeting of September 14, 2020 (Item No. 7) Page 3 Title: Comcast franchise renewal update law and is otherwise contrary to the law. No final decision is expected on this appeal until spring of 2021. City staff is working in close partnership with Brian Grogan, attorney at law, Moss & Barnett, throughout this process. To prepare for the potential impacts of the 621 Order, the needs assessment included: • Assessment of program origination sites at city and school district facilities currently provided at no charge as part of the current Comcast franchise agreement. The new FCC order may permit Comcast to assess “maintenance costs” for each connection. • Assessment of the community and business need for each of the five ParkTV channels. • Inventory of the various free and discounted Comcast cable viewing services provided to city buildings. Next steps: The draft franchise agreement will soon be submitted to Comcast for consideration. It’s expected that following their review there will be points of discussion prior to arriving at a final franchise. The current franchise agreement ends in January 2021. City staff is hopeful that a new franchise agreement will be in place by that time. Study session meeting of Sept. 14, 2020 (Item No. 7) Title: Comcast franchise renewal update Page 4 COMMUNITY NEEDS ASSESSMENT AND PEG ACCESS REVIEW FOR THE CITY OF ST. LOUIS PARK, MINNESOTA May 18, 2020 Prepared by THE BUSKE GROUP 4808 T STREET SACRAMENTO, CA 95819 (916) 441-6277 4808 T Street, Sacramento, CA 95819 (916) 441-6277 | www.thebuskegroup.com | [email protected] Study session meeting of Sept. 14, 2020 (Item No. 7) Title: Comcast franchise renewal update Page 5 TABLE OF CONTENTS Page I. INTRODUCTION .......................................................................................................... 1 II. COMMUNITY CABLE NEEDS AND INTERESTS ....................................................... 3 A. OVERVIEW AND METHODOLOGY ....................................................................... 3 B. COMMUNITY FOCUS GROUP WORKSHOPS AND ON-LINE SURVEY .............. 4 C. SUMMARY OF DISCUSSIONS AND BRAINSTORMING DURING ..................... 14 COMMUNITY FOCUS GROUP SESSIONS D. PARKTV OPERATIONS, FACILITIES, AND EQUIPMENT .................................. 20 E. SUMMARY OF MAJOR FINDINGS ...................................................................... 25 III. RECOMMENDATIONS REGARDING COMMUNITY CABLE-RELATED ................. 32 NEEDS AND INTERESTS A. INTRODUCTION ................................................................................................ 32 B. CABLE DISTRIBUTION SYSTEM ...................................................................... 33 C. SUBSCRIBER SERVICES AND CUSTOMER SATISFACTION ........................ 36 D. PEG ACCESS .................................................................................................... 38 APPENDICES 1. Community Needs & Interests Questionnaire 2. a. Responses to the Community Needs and Interests Questionnaire (by ALL) b. Responses to the Community Needs and Interests Questionnaire (by Comcast subscribers) 3. a. Questionnaire Open-Ended Responses: Comments about Comcast b. Questionnaire Open-Ended Responses: Comments about ParkTV 4. Notes from Focus Group Brainstorming Sessions 5. ParkTV Local Programming Operations Questionnaire 6. ParkTV Video Facility Inventory 7. Suggested Video Equipment Replacement/Upgrade Packages Study session meeting of Sept. 14, 2020 (Item No. 7) Title: Comcast franchise renewal update Page 6 COMMUNITY NEEDS ASSESSMENT AND PEG ACCESS REVIEW FOR THE CITY OF ST. LOUIS PARK, MINNESOTA I. INTRODUCTION Cable TV service in the City of St. Louis Park (“City”) is currently provided by two companies: Comcast and CenturyLink. In August of 2019, The Buske Group was retained by the City to conduct an assessment of community cable-related needs and interests, for use during franchise renewal negotiations with Comcast. The Buske Group was authorized to conduct research in order to identify current and future community cable-related needs and interests. The existing
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