HomeMy WebLinkAboutPublic Works January 25 20001
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WHATCOM COUNTY COUNCIL
Public Works and Capital Projects Committee
January 25, 2000
The meeting was called to order at 1:30 p.m. by Committee member Barbara
Brenner in the Council Chambers, 311 Grand Avenue, Bellingham, Washington.
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Also Present: Absent:
Marlene Dawson None
Dan McShane
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SPECIAL ORDER OF BUSINESS
1. ELECTION OF COMMITTEE CHAIR (AB2000-023)
Dawson nominated Brenner for committee chair.
Nomination carried unanimously.
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COMMITTEE DISCUSSION AND RECOMMENDATION TO COUNCIL
1. RESOLUTION CONDITIONALLY APPROVING THE BIRCH BAY WATER
AND SEWER (AB2000-044)
Dawson moved to recommend approval of the resolution.
Motion carried unanimously.
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COMMITTEE DISCUSSION
1. ORDINANCE AMENDING ORDINANCE 96-005 WHICH GRANTED A
FRANCHISE TO AT&T BROADBAND AND INTERNET SERVICES
(FORMERLY AT&T CABLEVISION OF WASHINGTON, INC.) TO
OPERATE AND MAINTAIN A CABLE COMMUNICATIONS SYSTEM IN
UNINCORPORATED WHATCOM COUNTY (AB99-476)
Brenner stated this was to provide the community with public access
television. They received a packet from Michael Kaminsky. She was not
comfortable with the information they received. She never received a copy of the
third party providor proposals. It would not have been stepping on anyone's toes if
the Council was aware of important items like the proposals.
Dawson stated she wanted to listen to the public's testimony.
Public Works Committee, 1/25/2000, Page 1
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McShane stated he would like to have some questions answered regarding
the budget presented in the ordinance and attachments. It looked like a great deal.
He was concerned that they could not deliver what the County wanted given the
proposal they submitted. He questioned whether the proposal was well thought
out.
Brenner stated her concern was that the original direction was to start slowly
rather than doing too much at once. The proposals looked more to the end
product, rather than going step by step. She didn't want to see the budget
justified. She wanted to see the proposals and why the committee thought they
were not appropriate. She didn't want the County to raise franchise fees. She also
didn't want the City of Bellingham to be in charge of this. She wanted a third-party
operator. She wanted to know more about what the County can and can't do for a
community access station. The programs on Channel 9 all have corporate
sponsors. She was not opposed to corporate sponsorship, but it shouldn't be the
only way they fund the programs. She didn't want to go to commercial television.
Dawson stated her concern was with the public paying the additional fee.
Her biggest concern was about the type of material that would be aired.
Advertisers help control the content. She couldn't support lack of content control.
Brenner stated she had concerns about content. She didn't want to air
anything that is pornographic or very disturbing to young people.
Hoag stated her concern was also with the taxes and the programming. The
information they were given says that some content, such as obscenity, is not
protected by the first amendment and cannot air on public access channels.
However, their definition of obscenity is very narrow. She described certain shows
that were allowed to be aired and were, in her opinion, obscene. She didn't want
taxpayer money spent on those types of shows. She wanted to show the good that
could be achieved from public access television, which would be government and
educational programming. Also, they should air programs that inform the public
about certain issues, but not borderline obscene programs. She wanted more
information about how they can get around that. They may be able to use the
model from Thurston County. They were able to effectively sidestep some of these
issues.
Brenner stated the County's legal representative was not present.
Hoag stated she wanted to know that the programming has a redeeming
value before they commit taxpayers' dollars to anything.
Craig Hayes, 4940 Lewis Avenue, stated he is a member of the Cable
Television Administrative Board (CTAB).
Marlin Prowell, Cable Television Administrative Board member, stated he was
involved in the board because he sees what happens with public access. They are
bound by the freedom of speech amendment. They cannot preclude free speech,
Public Works Committee, 1/25/2000, Page 2
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except in the standards set by the Supreme Court. Thurston County doesn’t refuse
to run such programs, but they just run those programs during the middle of the
night. The specific programming the councilmembers are referring to are particular
instances that are rare.
Hoag stated the obscene programming she was aware of was in either
Seattle or Olympia.
Brenner stated someone said there is a way they can have more control over
the content. Prowell stated the Federal Communication Commission (FCC) decided
that community standards can be applied.
Dawson questioned who establishes the standards. Prowell stated the
County Council could establish the standards. The board cannot.
Brenner stated they couldn't legally ban obscene programming. Prowell
stated Thurston County has a nonprofit entity that runs the public access facility.
They contract out to five different government agencies. The entity has said they
will enforce any community standards, but the communities have to say what those
standards are. None of the governments have set guidelines.
Brenner questioned whether standards could be challenged. Prowell stated
they could be.
Hoag questioned the summary on packet page 248, which says that the
content is the sole responsibility of the producer and is protected by the First
Amendment. It says that the programming is not censored by the CTAB, the city,
or the county. She wondered where the summary in the packet came from. Hayes
stated the board developed the rules, procedures, and policies. They have
extensive provisions restricting the content. If they reject a program, it can be
appealed and will eventually make it to the County Council for a ruling. The
program content, as outlined in the procedures, doesn't allow any obscenity.
James Baird, City of Bellingham Telecommunications Administrator, stated
the item Hoag referred to is an overview from the internet about what public access
can be. The information in the Council packet is from the internet. It doesn’t
reflect their policies and procedures.
Hoag asked for a copy of the Federal Communications Commission (FCC) rule
saying that community standards can be applied. Hayes stated they could get that.
With respect to the budget, what will be provided is not the production of
programs. Public Education and Governmental (PEG) would only get already-
produced programs and arrange to air them. They would provide cameras, editing
machines, and a facility for members of the public to utilize. If the City of
Bellingham or one of the third-party access providers were selected, they would
operate a television station with up to five channels, pursuant to the franchise
agreement. They would only have a person on duty to check out the cameras,
collect the produced videotapes, edit the videotapes, and produce a television
Public Works Committee, 1/25/2000, Page 3
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program with the computers. They are talking about capital expenditures, much of
which already exists. They are talking about providing a facility, and they are
talking about providing labor to keep the facility open. They are not talking about
making television programs.
Brenner questioned whether someone already has that set up in the area.
Hayes stated they don’t have one for the public to use.
Brenner suggested they figure out a way to do it through the technical
school, college, or university.
Baird stated Felix Anderson sits on the Bellingham Technical College Board.
He is in negotiations with the college. At the City Council meeting, the technical
college said they wanted to be a player and to get involved. The city has
approached the technical college to see if they want to house the facility. They
can’t do it at this time, but they would like to provide equipment training in their
curriculum. Western does not have the facilities, and is not interested. Whatcom
Community College is restricted from being involved with video training because
Skagit Valley College has it. They are restricted from getting state funding.
Hayes stated for the past year and a half, representatives from Western
Washington University (WWU), Whatcom Community College (WCC), and
Bellingham Vocational-Technical College have attended the CTAB meetings and
listened to discussions about this. They have all expressed support for PEG, but
indicated they are not in the position to be the third-party provider.
Brenner stated she didn’t want them to be the PEG provider, but the schools
would be the best place to get training. She questioned whether the County would
be leasing and returning tapes. Baird stated that was correct.
Hayes stated the big issue was that they don’t want to increase subscriber
fees. That is the big issue. However, there isn’t an appreciation for PEG, and in
terms of increasing subscriber rates to pay for PEG, people don’t want to do it. If
there is a method to fund it without increasing rates, they can work through the
other issues. AT&T is now hooking up computer modems at home. They are
charging $39 per month. They are installing five to ten modems per day. Right
now, the County is collecting $250,000 per year for franchise fees. The County
charges four percent. The revenue from hooking up the computer modems would
pay for public television without increasing subscriber fees. They could do that
instead of increasing the franchise fee from four to five percent.
Baird stated that starting in June or July, TCI and AT&T will be expanding
telephone service across the same infrastructure and will generate revenue. That
will be additional money coming in as unanticipated revenue. They need to start
slowly and build to success. Right now they need to get a bulletin board going,
which is a scrolling field across the television screen that gives information about
the community. It will cost about $31,000 to acquire the equipment.
Public Works Committee, 1/25/2000, Page 4
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Hayes stated TCI would no longer do public access starting July 1.
Hoag stated the City’s franchise agreement expires on that date, but the
County's agreement doesn’t. Prowell stated the City agreement says that as soon
as the upgrade is complete, the City will take over community access services. The
County agreement isn’t the same. The County’s agreement is that TCI will continue
to operate PEG television until the County gives one year written notice that they
want to take it over. The County agreement obligates AT&T to continue to operate
PEG. The City doesn’t have that proviso.
Baird stated the City and County both signed 15-year contracts with TCI in
1996.
Hayes stated they don’t get any franchise fee on satellite dishes. The fear as
a cable subscriber is that people will subscribe to satellite service if the cable rates
get too high. Community programming will never be on satellite television. Having
the local events televised will decrease the likelihood that a person turns off their
cable.
Baird stated that as of January 2002, the FCC will require a franchise
surcharge on all satellite services. The money probably won’t come to the County.
Hayes stated they have to consider the implications of I-695 if they raise the
franchise fee.
Brenner stated Chief Civil Deputy Prosecutor Randy Watts said that, because
the franchise fee is a federal tax, it doesn't have to do with I-695.
Hoag questioned whether they would need to have a public vote if they take
the revenue from the modem fee. Hayes stated they wouldn’t. If someone wants
to add a computer modem onto his or her cable service, that person elected to do
that and he or she elected to pay an existing tax, not a new tax.
Brenner questioned why they don’t redirect a portion of the franchise fee
they already collect. Hayes stated they could, but from a practical point of view,
they felt that the councilmembers would not be inclined to take money from the
general fund to provide a new service. That is difficult sell to the City, to dip into
their existing revenues. The revenues from the modem fee are unanticipated
revenues. The revenues from the franchise fees are going to go up dramatically
because a person now has to have a digital box for each television and people
generally want more programming.
Brenner questioned whether the television will be obsolete and whether a
company can discontinue providing the television service. Baird stated they have
to continue basic television service.
Hoag stated that, in light of I-695, increasing the fee and pulling from
revenues is not something she would like to do. She questioned whether the
Public Works Committee, 1/25/2000, Page 5
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modem fee would be an ongoing source of revenue. Hayes stated the concept
would be that, as people hook up to the modem, the income generated from the
monthly fee, which would be 4 percent of $39.95, would be collected monthly. The
time may come when the fees collected from the computer modems will exceed the
amount of money necessary for community access television. At that time, the
surplus would go back to the general fund.
Brenner asked about content and how much information they have from
communities who have created community standards. She questioned where the
line is drawn. Prowell stated no community has dealt with it to satisfy everyone.
At some point, someone will want to put on a videotape, they will say no, and the
person will appeal and sue. It will happen.
Baird stated that is happening in Seattle.
Dawson stated movies are rated. She questioned whether they could ban R-
rated movies. Baird stated they cannot ban R-rated movies, but hey can dictate
when they are aired. They can ban X-rated movies.
Hoag stated she wanted to see the FCC guidelines about community
standards. Airing inappropriate materials in the late hours bypasses the issue of
taxpayers paying for inappropriate materials. Also, shift workers are up at night.
Baird stated there are new FCC guidelines on community standards and he will
provide that information. In the policy and procedures, it lists the criteria on
whether a program meets qualifications and can be aired. The station manager has
the first view. If it meets all the qualifications set down by both councils, then it
can go on the air. They can even put a rating on it.
McShane asked how much a one-percent raise in fee would be per
subscriber. Baird stated basic service is $14.45. One percent of that is 14.4 cents.
Extended basic is $26 to $27 per household. Digital service is $50 to $60 per
household.
Brenner questioned whether they could charge a flat fee. Baird stated they
looked at that from other cities. Vancouver, Washington collects a $1 per
household fee to fund their public access. They have a budget of $250,000 to
$300,000 per year. They've been in production for five to seven years.
Brenner stated that is a fairer way to do it because it is a fee for service.
McShane stated it is also progressive.
(Clerk’s Note: End of tape one, side A.)
Brenner stated the rate is not fair to people who buy more service because it
is supposed to be a fee. Otherwise, it should be called a tax. She questioned
whether there is a way to substitute part of the franchise tax for a flat fee instead
of raising the franchise fee. Hayes stated the existing franchise agreement would
Public Works Committee, 1/25/2000, Page 6
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not allow that. It says they can get a percentage of the gross revenues of TCI.
They could negotiate an amendment to the contract, but it would take an
amendment to the franchise agreement to require TCI to pay a flat rate instead of a
percentage.
Brenner stated there are two ways of collecting the fees. One is from the
company bringing in the revenue. They pay a percentage of that revenue to the
community. The other way is that they bring in their $100,000 and the county
tacks on a percentage to the person's bill instead. They are not talking about a
percentage out of the revenue. They are talking about a percentage being added to
the consumer's bill. Those are two totally different things. In one way, they don’t
touch the consumer, but they do the other way.
McShane stated that, if AT&T chose to pass on that cost to the consumer, it
would cause their gross revenues to go up.
Prowell stated the franchise fee is applied to the gross revenue. The
subscriber gets the bill. The additional fees applied to the bill are itemized on the
bill.
Brenner stated it is a fee to the subscriber, not to the cable company.
Prowell stated that was correct. AT&T acts as the collection service. There are a
number of requirements in the franchise. AT&T could choose to charge a number of
items listed in the franchise fee to the consumer as a cost of business. They could
charge the subscribers for the current public access they are providing. They
currently choose not to.
Hoag questioned where it leaves the County if the City's contract ends. She
questioned whether channel ten would continue. Hayes stated it is not that the
contract ends, but it is the PEG takeover. The City said they would take over the
public education and governmental (PEG) aspect once the upgrade was done. The
County said they are not going to agree to take over PEG. He wasn’t certain where
that leaves the County, if the County still makes AT&T do the PEG operations. The
City of Bellingham is then in the position of questioning whether there will be two
different PEG operators and if the county residents receive a different service than
the city residents. The County is in the superior position.
Prowell stated the County might decide not to send the letter and tell AT&T
to continue to provide the service. However, AT&T may decide not to provide it for
free. That is their legal right to do. They will decide how much it costs. Regarding
the content issue, there is a board that is made up of nine producers. They are an
oversight board for the public access facility. They are the advisory group that
deals with content. There is a mechanism for that to happen. It is up to the
council to enforce particular standards.
Hoag questioned whether AT&T is required to provide public access
television. Prowell stated they are, but not for free. Regarding the flat rate idea,
the Council could allocate a certain amount per subscriber out of the current
Public Works Committee, 1/25/2000, Page 7
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franchise money to be dedicated to public access. It would not increase the bill; it
would require that money coming from cable subscribers go back to the cable
subscribers. It would be a matter of coming up with a budget.
Dennis Lang, citizen, stated they have a unique opportunity to find ways to
finance public access within the parameters already given. Whether or not they
add the extra one or two percent, the City is looking at new revenues from new
products that AT&T is producing. He provided information (on file) that shows a
chronological flow of public access. The Media Alliance is a national federation of
public access around the country. They've been operating for about ten or fifteen
years. They are a very good resource to answer some of the questions being asked
about content, financing, and how public access comes into being. For instance,
less than one percent of public access programming is R-rated, X-rated, or
controversial. There are over 200,000 hours of programming produced by public
access around the country. Also, AT&T is a utility and not a cable company. The
franchise agreement was made with a cable company, TCI Cablevision. Those lines
between cable and utility are vastly changing.
Brenner questioned whether the County no longer has a cable company
because AT&T bought out TCI. Lang stated that is a gray area about whether utility
law from the FCC applies or whether cable law applies. Communities who answer
that question will help to define their needs, which will define what is going to
happen nationally.
Brenner stated her concern was that Congress is leaving this up to the local
jurisdiction. Lang stated Congress and the Department of Commerce are also
working on it. It is about getting the feedback from every player and not just
letting the industry define what cable is going to be. That is what is happening with
all the mega-mergers. It is hard to define, and will be harder to define as time
goes on. Cable is the largest profit-making center. That is why America Online
(AOL) bought out TCI, and why the cable mergers are going on. Each cable area
gets a huge amount of revenue from Home Box Office (HBO), ESPN, and other
networks on a monthly basis just to advertise or carry special programs. Those are
small profit centers. The advertising rates they charge locally are also revenue.
They are very, very good investments. When AT&T builds a new secure building,
they will not allow a public access facility. It will have to be built elsewhere, and
the City, the County, or a joint venture would have to run it.
Lynn Barton, 1280 W. Bakerview Road, Bellingham, stated Lang’s comments
are correct. Many people have been involved and there is much information.
Regarding content and public access, she was concerned that public access not be
shortchanged for all its potential.
Brenner questioned whether the County is allowed to say what percent of the
programming is local. Barton stated they could put something in place through the
proposed procedures from the CTAB that manages what comes in. They have put
in place four levels of consideration. The first level is local programming. The
Public Works Committee, 1/25/2000, Page 8
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second consideration is local programming that isn't created through the access
facility. She is speaking on prioritization for airtime.
Brenner questioned why they would prioritize local programming that was
produced at the facility over local programming that was produced elsewhere.
Barton stated it is a matter of making sure the people using the facility are given a
priority. It is the proposal.
Brenner stated she was concerned about giving priority to someone who uses
their facility over someone who doesn’t.
Brenner questioned whether they could prevent people who are not local
going through the communities to challenge the community standards. She was
concerned they would bring in a national effort to challenge the community
standards. Barton stated that falls in with the priority programming. Through the
community standards, they can define what the priorities are. Imported programs
can be lower on the priority list. The City has recognized its intent to hand this
over to a third party. The intent with the City's Information and Technology
Services Department (ITSD) is to get this started. The CTAB recommendation was
that it be handed over to a third party. With the funding required for this year, it
will be implemented halfway into the year. They will need a lesser amount for the
first year. They should look at how much will be spent by the end of the year.
They are ready to put on a community bulletin board. It would be nice to assure
that happens in July.
Brenner questioned whether they could use advertising to fill in until they
have enough public access programs on the public access channel. Barton stated
the FCC intent is not for advertising.
Baird stated they could not.
Barton stated she supported the concept. She hoped the County also sees
the vision and participates in the process.
Brenner questioned whether there were any complaints on the content since
TCI has been doing this locally. Hayes stated there were a few.
Patty Mahbob Zadeh, 35 North Point Drive, Bellingham, stated this is about
the community and the issue is important. As the companies merge, everything
becomes bigger and more the same. It becomes more difficult to define
themselves as a community. Airing programs with inappropriate content during the
late hours is better than airing it at any time because at least the children will not
be watching. Public Access is a great opportunity for the community.
Jim Gregory, 1000 Jersey Street, stated there wouldn't be any community
program without a place for the community to produce their shows. This is an
opportunity to not lose the facility they have. Finding the funding should be easier
than finding funding for a road.
Public Works Committee, 1/25/2000, Page 9
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Dave Pros, 1466 Roy Road, Cable Television Administrative Board Member,
discussed what is going on in the market with television. There is an income that is
derived from cable television through AT&T. AT&T also has a lot of competition.
The competition is getting pretty fierce. Satellite service is becoming competitive.
There is no income derived for the county from satellite service. This service can
build a community. If it is not encouraged, there is nothing unique about cable
television versus satellites. The bottom line is that if there isn’t a way to fund this,
the satellite entities will come in and the revenues will get smaller.
Brenner stated that if they start raising fees and people aren't getting what
they want, then they are going to be more likely to switch as they see their cable
bills raise.
Pros stated funding should come from the current franchise fee.
Bob Ryan, Bellingham City Councilmember, stated they are anxious to work
with the County.
Hayes stated he provided copies of the two proposals.
Ryan stated he talked with Dan Crocker, AT&T Cable, who expressed his
regret at not being able to attend the meeting.
Brenner stated they need more information from the FCC and other
communities. This would be held in committee for the next few months.
Dawson asked about the City's direction. Ryan stated the City would
probably fund this. They still have questions that need to be answered. They
would prefer to do this with the County.
Hayes stated AT&T is done with the PEG business as of July 1. It is relatively
soon.
McShane stated they should go ahead and approve the increase. There are
other issues that need to be worked out that are separate from raising the fee. It is
$.13 to $.50 per user per month. There is a commitment from the County to do
this. He so moved.
Motion failed 1-2 with McShane in favor.
Brenner stated this would be held in committee.
Baird stated the drop-dead date is June 1.
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ADJOURN
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Public Works Committee, 1/25/2000, Page 11
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The meeting adjourned at 2:55 p.m.
______________________________
Jill Nixon, Minutes Transcription
ATTEST: WHATCOM COUNTY COUNCIL
WHATCOM COUNTY, WASHINGTON
______________________________ ___________________________
Dana Brown-Davis, Council Clerk Barbara Brenner, Committee Chair