Loading...
HomeMy WebLinkAboutM-83-03800 CIT', OF MIAM,. VLOWDA INTER -OFFICE MEMORANDUM Honorable Mayor and Members of the City Commission Howard V. Gary City Manager,' Recommendations May 6, 1983 Cable Television Annual Report 1. That the findings and recommendations of the City Manager be taken under advisement and implementation held in abeyance until the July 14, 1983 meeting of the Commission. This course of action is requested and warranted for the following reasons: A. Further information will be requested from the licensee through additional submis- sions, conferences and on -site investigations. The licensee is being put on notice that unless the information requested is provided, action will be taken under the provisions of Ordinance No. 9332, Section 1002(3) for failure to cooperate during review. B. Additional time will provide the oppor- tunity to review the licensee's progress under the revised construction schedule. C. Additional time will afford the develop- ment of local originatiqn and community programming, affirmative action and training plans with the licensee. 2. It is further recommended that the City Commission authorize a contract for services with Dennis Zimmerman,of Warren Braun Consulting Engineers in an amount not to exceed $10,000.00 for the purpose of assisting in conducting the technical review of the CATV system. " ' 83--38v 0 Background Article VII of Ordinance No. 9332, the Cable License Ordinance, sets up procedures for oversight and regulation of the cable tele- vision licensee by the City. Section 704(c) requires the City Manager to review the licensee's performance to determine whether the licensee has complied with the provisions, obligations, terms, and conditions of the cable television license ordinance, and then to report to the City Commission setting forth specific findings and recommendations and the facts and reasons on which they are based. The cable licensee is required by the license ordinance to submit a number of reports. With the exception of the audited financial statement for 1982, all required reports were filed in a timely fashion. However, for the most part they did not contain enough quantitative information to be reviewed and independently verified by City staff to determine compliance with the license ordinance. Therefore, supplemental information was requested from the licensee on March 18, with an offer to schedule meetings to resolve any ambiguities or to answer any questions that might arise during pre- paration of the response. The majority of the licensee's response was received April 1, 1983, too late to be included in the set of reports made available to the public and to the Mayor and Members of the City Commission on that date. The final. exhibit of the appli- cant's response was received on April 13, the 1982 audited financial statement on April 20, and these documents were distributed on April 25, 1983. Findings The areas and topics for review specified in Article VII and in Article XI of the license ordinance are discussed below, grouped under the following larger headings: Technical, Programming Services, Training, Affirmative Action, Rates, Ownership, and Financial. A. Technical 1. Construction Schedule. At its meeting of April 28, 1983 the Commission specifically approved the licensee's delay in construction due to the occurrence of conditions beyond the licensee's control. A construction monitoring system is being established to determine the licensee's progress and compliance with the revised construction timetable. 2. Technical Specifications and Performance Standards. Technical information submitted by the licensee is in some aspects insufficient, and in other aspects contradictory. The licensee did not respond to the City's request for copies of proof -of -performance tests performed to date. In order to determine compliance the following steps are being taken: Page 2 83-360 0 0 (1) Require resubmission by the licensee of technical specifications and information on forms supplied by the City. The completed forms will be required to be submitted by June 1, 1983. (2) Require the licensee to submit by May 19, 1983, copies of the mini proof -of -performances completed to date; notification 10 days prior to performing each mini - proof so that a representative of the City may observe the test; copies of all mini -proofs after they are performed. (3) Require that an on -site inspection of and verification of the licensee's headend and cable plant completed to date be made by the City's consultant, Mr. Dennis Zimmerman of Warren Braun, Consulting Engineers, and that Mr. Zimmerman meet with the licensee to clarify and resolve contradictions in the information furnished. These steps will assist also in determining the licensee's development of the system's interactive capability, the adequacy of the system's institutional cable, and its appli- cation of state-of-the-art technology in design and services of the system. B. Programming Services Regarding the development and adequacy of local origination and community access programming, the licensee did not fully respond to the City's request for the information necessary to make a review. City staff has been unable to verify some of the information furnished. In its Response, the licensee states it is "working with the Anna Brenna Myers Institution" to produce its local origination and public access and that the institution has agreed to let the licensee use "the two studios and equipments" for its programming needs. Mr. Don McCullough, Director of Media Services, for the Anna Brenna Myers Telecommunications Center states that there has been no such agreement with the licensee. (Exhibit 1). The licensee supplied copies of bids for lease of local origina- tion equipment on April 13, 1983. A review of these indicates that the bid quotation expired on March 10, 1983. There has been no further indication from the licensee as to the status of the bids. Due to the insufficiency of information and the need to clarify the apparent contradictions within the information furnished, meetings will be set up with City staff, the licensee, and repre- sentatives of the Anna Brenna Myers Telecommunications Center to determine and develop the licensee's plan. Page 3 S3--380 The licensee enclosed, as requested, copies of its contracts with three local groups: Evelio Ley and Associates, Inc. to produce local origination programming of benefit to the Hispanic` community; Georgia Jones Ayres and Joshua High to produce local` origination programming of benefit to the Black population of Miami; and the Metropolitan Fellowship of Churches to provide local origination of interest to the Christian population of the City. Meetings will be held with representatives of these groups to determine their progress. C. Training Although the licensee's response to the request for supplemental information was non-specific and contradictory, some determination can be made on the establishment and development of training programs. Of the six (6) persons reported as trained and working as installers, apparently two (2) are residents of the City of Miami. They received on-the-job training by Americable at its South Dade facility and are employed by Miami Cablevision as installers. City staff confirmed that three (3) people are being trained at the Institute of Security and Technology: two (2) as CRT operators and one as dispatcher. There are also fifteen (15) persons being trained at the Institute as security installers. The licensee needs to improve training programs. Ivey Kearson, Jr. Supervisor, Overtown Jobs Program, will initiate a series of meetings with the licensee in order that contradictions in the information furnished regarding its training efforts may be resolved and a training and internship plan be developed that will yield more satisfactory results. The plan to be developed will include a provision that Miami Cablevision use Lindsey Hopkins to provide classroom training coupled with on-the-job training to be provided by the licensee. It will be recommended that Miami Cablevision subsidize this training program. D. Affirmative Action The incompleteness of the licensee's response to the request for supplemental information and the contradictory nature of elements of the information furnished present obstacles to determining Miami Cablevision's progress and achievements in local hiring and purchasing, affirmative action, and minority business participation. Dr. Hattie Daniels, Affirmative Action Supervisor, will set up a series of meetings with the licensee to receive clarification and resolve contradictions in the information furnished, verify information through on -site visits, and with the licensee, develop a feasible employment and affirmative action plan that will lead to achievement of goals in this area. Page 4 83-380 0 0 E. Rates In order to determine the stability of the licensee's rate ' structure and compliance with the provisions of the cable license ordinance, the licensee was requested to provide, on forms furnished by the City, its currently offered basic and pay services and rates. This information was received on March 17, 1983. Although rates for the four tiers of basic services are unchanged, Exhibit 2 attached (Rate Stability), indicates that there has been a substantial change in pay rates from those proposed by Americable in its original application and incorporated by reference into Appendix C of the Cable Television License Ordinance No. 9332, and those rates currently in effect in the Miami cable system. A letter will be sent notifying the licensee that, in accordance with the procedure established in Section 1004 and relative to Section 801(b) of the Cable Television License Ordinance No. 9332, Miami Cablevision shall be allowed not more than thirty (30) days to correct said violation of Section 801(b) or to present facts and argument to the City Manager in refu- tation of said violation. F. Ownership There has been full compliance with the request for supplementary information regarding the officers, directors, and partners of the licensee, TCI, and Americable. Additionally, the licensee made a complete reporting in response to the request for information regarding changes in percentage of ownership and changes in sharing of any profits or losses of the licensee, TCI, and Americable. As is shown in Exhibit 3 attached (Americable's Ownership, Exhibits A & B), analysis by City staff indicates that a change of ownership amounting to 32.59% of the ownership of Americable has occurred. Any change in ownership is required to be reported to the City under Administrative Rule 1, Transfer of Ownership Interest in Cable Television Licensee, which provides for the necessary information regarding ownership interest in the cable television licensee as required by the license ordinance. A letter will be sent notifying the licensee that, in accordance with the procedure established in Section 1004 of the Cable Television License Ordinance No. 9332, Miami Cablevision shall be allowed not more than thirty (30) days to correct said viola- tion of Administrative Rule No. 1 (established relative to Sections 701 and 204 of Ordinance No. 9332), or to present facts and argument to the City Manager in refutation of said violation. Page 5 83-36C G. Financial 1. 1982 Audited Financial Statement. Section 708 of the cable television license ordinance provides that the licensee submit a certified financial statement for the previous year not later than 105 days after the close of the City's fiscal year. The 1982 audited financial statement was received on April 20, 1983. The licensee has been advised that future annual certified financial statements are due 105 days after October 1, each year throughout the term of the license. The licensee has requested that the Ordinance be amended to require an unaudited financial state- ment for the previous year, with the audited statement to be filed not later than 105 days after the close of the calendar year. This request is presently under review. Due to the late submission of the 1982 audited financial statement, it has- been impossible to complete a thorough review of the state- ment. However, a preliminary review has disclosed certain items of concern that will require further investigation. The financial statement will be reviewed with the licensee and its representatives. 2. Construction Costs. Under the provisions of Section 708(3) the licensee must provide a current statement of the costs of construction. Reviewing the licensee's statements regard- ing construction costs, it is apparent that the amounts given as construction costs disagree in the various financial reports and responses presented to the City. City staff will meet with the licensee and its representatives to resolve these apparent contradictions. If these cannot be resolved, an on -site audit of the books and records will be conducted to determine construction costs. 3. Revenue Statement. The licensee has complied fully with the provisions of Sections 901, 405, and 406 regarding payment of license fees and community access and drug enforcement contributions. However, in its most recent Revenue Statement reporting gross revenues and reconciliation of payments, the licensee has included its contributions made pursuant to Sections 405 and 406 as license fees. The City Attorney will be requested to address this matter. Additionally, in the financial forecasts submitted by Miami Cablevision pursuant to Section 210 of the license ordinance on March 30, 1982, interest income is treated as being part of total revenues. However, in its more recent certified Annual Report filed on April 20, 1983, interest income is Page 6 83--36G totally deleted from total revenues. This has the ultimate effect of reducing the amount of the license fee requirement to be paid by Miami Cablevision to the City of Miami. As a,. well -settled principle of accounting, it is recognized that interest income be included in total revenues, since interest expense incurred as a result of the interest income transac- tion has been included in the operating costs and expenses. Page 7 83-3c"J'a 0 CEIVEi: v DADE COUNTY PUBLIC SC66a.l ADMINISTRATIVE OFFICE DR. LEONARD BRITTON SUPERINTENDENT OF SCHOOLS Mrs. Mary Sue Smoller Cable Television Officer Metropolitan Dade County County Courthouse (Miami, Florida 33131 Dear Mrs. Smoller: Rvhihit 1 LINDSEY HOPKINS BUILDING 1983 %!iY on�E�'bIT31r75cHooL BOARD 1410 NORTHEAST SECOND AVENUE MR. G. HOLMES BRADDOCK, CHAIRMAN MIAMI, FLORIDA 33132 MRS.ETHELBECKHAM, VICE-C(IAIRMAN MR. PAUL L. CEJAS DR. MICHAEL KROP MRS. JANET MCALILEY MR. ROBERT RENICK April 22, 1983 MR. WILLIAM H. TURNER This response is made to your request concerning the status of any agreements between the school system and Miami Cablevision which would provide facilities or equipment to Miami Cablevision for the production of access programming. While there have been some preliminary discussions with representatives of Miami Tele-Communications, which holds a contract with Miami Cablevision to provide local access programming on Miami Cablevision channels, these have been limited to informal discussions concerning arrangements in which the school system might provide studios and equipment for local origination production. _ While it is possible access programming might benefit from such an arrangement, this has not been the focus of these discussions. As a consequence of these limited discussions there is, at this time, no existing arrangement between the Dade County Public Schools and any agency to provide facilities, equipment, or staff for the production of either local origination or access programming on the Miami Cablevision system. Sincerely, '- -- �'>' h'-V \ (.' D,: , � Don MacCullough, Execute Director Division of Media Programs DM/cs cc: Dr. Britton Mr. Bell 83"'��` • • RATE STABILITY Tier 1 Proposal: The Movie Channel (TMC) Galavision Installation later Actual: TMC Galavision HBO Installation later Tier 2 Proposal: TMC Galavision Installation later Actual:TMC Galavision HBO Installation later Tier 3 Proposal: TMC Galavision Installation later Actual: TMC Galavision HBO Installation later Other Cinemax: Proposal Actual Showtime: Proposal Actual Exhibit Rate Difference $14.95 14.95 16.00 $15.00 + $ .05 15.00 + .05 15.00 + .05 15.00 - $1.00 $ 9.95 9.95 16.00 $15.00 + $5.05 15.00 + 5.05 15.00 + 5.05 15.00 - 1.00 $ 9.95 9.95 16.00 $12.95 + $3.00 12.95 + 3.00 12.95 + 3.00 15.00 - 1.00 $ 9.95 12.95 + $3.00 $ 9.95 12.95 + $3.00 83-36"10 4 N CITY OF MIAMI, FLOR DA INTER -OFFICE MEMORANDUM Merry Sue Smoller Assistant to the City Manager for Cable Administration Manu i Rodrigue Accountant Supervisor Exhibit 3 May 2, 1983 Americable's Ownership Exhibits A & B. Exhibits A & B. Exhibit "A" shows Class A - Limited Partners according with the information previously submitted. Exhibit "B" shows Class A - Limited Partners according with the information submitted on March 18, 1983 in response to our request for supplementary information. An analysis of both exhibits discovered a change in ownership'.of 32.59%. MR/mmm Encls. 83--38 AMERICABLE OF GREATER MIAMI, LTD. CLASS A PARTNERS General Partner: Charles C. Hermanowski Limited Partners: EXHIBIT "A" 41.5% Ehrenkranz, EHR & Schultz) Kenneth E. Behrins ) Fred R. Sullivan ) Laurence A. Tisch ) Alan V. Tishman ) Robert S. Birch ) Preston R. Tisch )Investment Group 41.5% Herbert D. Fried ) Stephen M. Peck ) J. L. Gitterman III ) Albert Fried, Jr. ) William D. Mayer ) Arthur T. Shorin ) CLASS B. PARTNERS Limited Partners: William Hoffman Trust Acct. 1% Stephen P. Ross 3% Estate Richard B. Knight 3% Abraham Manber 8% S. J. Westergreen 1% Dr. W. A. Patterson - 1/3) Rev. Richard Barry - 1/3) 1% Berneka Silva - 1/3) 100% 83-360 4 0 EXHIBIT "B" AMERICABLE OF GREATER MIAMI, LTD. CLASS A PARTNERS General Partner: Charles C. Hermanowski 41.5% Limited Partners: The Arsenol Company .7% Kenneth E. Behring .7% Arthur B. Belfer 1.71% Robert A. Belfer 1.38% Terence Deeks .7% Delman Associates 1.38% Otto Ecstein .7% Ehrenkranz, Ehrenkranz & Schultz 2.31% Jerrold N. Fine .7% Joseph H. Flom .7% Albert Fried, Jr. .7% Joseph L. Gitterman III •.7% Arnold Glimcher .7% Irvin L. Goldman .7% Barbara L. Goldsmith . 7% Martin Goodman .7% Leonard A. Lauder .7% Warner LeRoy .7% Bernard Levey .7% Victor Levy .7% George L. Lindermann .7% G.L.L. Family Partnership .7% M. H. Holdings 1.15% Catherine S. Mercer .7% D. Derek Mercer .7% Henry D. Mercer, Jr. .7% Howard M. Pack .7% Arthur Kalish and Walter Leinhardt .7% Frederick P. Rose .7% Laurence Ruben .83% Howard J. Rubestein .7% Richard Rubin .7% Stephen Rubin .7% William R. Salomon .7% Jack Saltz .7% Bertha B. Shepard .7% Richard E. Smith .7% Jerry I. Speyer .7% Michael H. Steinhardt .7% Irving Sterm, Jr. .7% Fred R. Sullivan .7% Irvin S. Taylor .7% Laurence A. Tisch 1.9% 83-380 rj 0 Preston R.'Tisch The Tisch -Company Sherle Waqner Weight Watchers of Chicago, Inc. Stephen H. Weiss CLASS B PARTNERS T.4-4 fie -.A D�r�rer� William Hoffman Trust Acct. Stephen P. Ross Estate Richard B. Knight Abraham Manber S. J. Westergreen Dr. W. A. Patterson - 1/3) Rev. Richard Barry - 1/3) Berneka Silva - 1/3) Page 2 of 2 1.9% 1.38% .7% .96% ' .7% 41.5% �3-360