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WI: Does cable franchise bill pit David versus Goliath?

By saveaccess
Created 04/20/2007 - 7:53am

from: River Falls Journal [1]

Does cable franchise bill pit David versus Goliath?

Phil Pfuehler River Falls Journal
Published Friday, April 20, 2007

Dawn Wills believes city residents who like to watch local cable for River Falls Days, high school football, basketball, hockey and wrestling, church shows, summer park concerts, poetry readings, City Council meetings, the Memorial Day parade, Chamber of Commerce banquets and more should be plenty worried by the Video Franchising Competition Bill.

If state lawmakers pass the bill in the next few weeks, Wills says local cable in River Falls and Wisconsin could go the way of the dinosaur.

“What this bill could do is snuff out the local voice,” said Wills, cable access coordinator for River Falls Community Television. “I am not exaggerating when I say we might have to close our doors at RFC-TV.”

City Administrator Bernie Van Osdale agrees: “It’s not a good deal for our city,” he said. “It could very well mean the end of our local cable channel.”

But the Video Franchising Bill is about evolving technologies and market forces that ultimately benefit everyone, counters state Sen. Sheila Harsdorf (R-River Falls).

“Technology is changing so fast that we need a system in place that isn’t restrictive and facilitates change so that consumers get a better deal,” Harsdorf said. “Competition, generally, brings about better prices, options and services.”

The bill before the Legislature would take away the hundreds of municipal cable franchises and lump them under one domain — the state’s. Similar legislation has passed in 12 other states.

The Wisconsin League of Municipalities opposes the bill because it would void local cable franchise agreements and drastically cut money for local cable-access TV.

The cable-TV provider for the city of River Falls is Twin Cities-based Comcast. The franchise agreement with Comcast runs through 2013.

River Falls Community Television — RFC-TV 16 — gets five percent of the gross revenues from Comcast’s deal with the city to operate. The local cable station also collects a $1.34 fee per cable household — some 2,700 in River Falls — on monthly bills.

It all adds up to almost the entire $136,000 budget used to keep RFC-TV 16 afloat.

“The fees give us community television,” Wills said. “Comcast is renting our public right-of-way, most of it buried underground, to run their transmission lines.”

The state bill is being lobbied by telecommunication giants like AT&T and Verizon. They want to skip time constraints of dealing with cities and towns and instead get one deal straight from the state.

These companies also want to enter the video service market and offer customers a convenient “bundle package” that includes cable, Internet and phone.

Newly elected City Council Member Mike Woolsey, who also serves on the Cable Communications Advisory Committee, said the state bill jeopardizes local cable TV. He said if the right amendments are made, the bill might be acceptable.

“I think some people are OK with having a state franchise instead of local ones, but it needs to include community access to the cable conduit, the fiber optics, or whatever that runs on the public right-of-way,” he said. “That’s what we use to express ourselves. We want that maintained. It’s what makes us different from the corporate entities that run mass media.”

Harsdorf said the current bill, while allowing telecom companies to bypass municipalities to negotiate a state franchise deal, won’t shut off fees to operate cable-TV stations.

“This is not a state-revenue generator,” Harsdorf said. “The five percent franchise fee would go back to communities.”

Harsdorf admitted the five percent return might not be as lucrative. The bill’s definition of cable providers’ gross receipts excludes advertising revenue — reducing the franchise fee return to municipalities by 20-30%. The bill also doesn’t mention the pass-through household fee.

Wills said the pass-through fee is huge, bringing in $43,000 a year — roughly a third of her budget. Combine that loss with losing a portion of the franchise fee and nearly all of RFC-TV’s budget evaporates.

Besides these concerns, an even bigger hit looms: Comcast’s transmission lines for River Falls.

Right now, the local cable station, and the educational stations for the school district and UW-River Falls, use those lines at no cost. It’s so written in the local franchise agreement.

Under the state bill, free transmission-line access isn’t guaranteed. Wills said if such protection is omitted, telecom giants doing business with communities aren’t going to offer free access lines “out of the goodness of their hearts.”

While the dollar figures vary, Wills said the new state bill — without major amendments — could virtually wipe out RFC-TV’s budget.

The only saving grace — and it’s temporary — is that the local cable station built a reserve fund in the early years when there wasn’t a paid coordinator. With $200,000 in reserve, Wills said the station could survive for a short while before closing.

“It wouldn’t last long,” she added.

Would the City Council budget extra money each year to keep the local cable station afloat? Van Osdale said it’s doubtful: “It is very unlikely that the city would or even could make up the shortfall.”

Wills, who last month testified in Madison before a state Senate hearing on the cable franchise bill, urged local residents to contact Harsdorf, state Rep. Kitty Rhoades and other area lawmakers.

“It has to be done now!” Wills said. “We have to get the fire going.”

And Woolsey said people should cite specific local programs — high school athletics, church services, government meetings — that are valuable when contacting lawmakers.

Wills said River Falls residents can easily reach state lawmakers by going online at www.rfcity.orgRFCTV. Click on the top link that reads: SAVE ACCESS: Say No To Video Competition.

The toll-free number to reach Harsdorf is 800-862-1092. Rhoades, out of Hudson, can be reached at 888-529-0030. Call state Rep. John Murtha at 888-529-0029.

Phil Pfuehler can be reached at or at 426-1050.

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