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HomeMy WebLinkAboutCC 1981-07-07 Minutes41 11 CITY OF MIAMI 2 r t� 96 Vol , OF MELTING HELD ON July 7, 1981 PREPARED BY THE OFFICE OF THE CITY CLERK CITY BALL RALPH G , ON G I E CITY CLERK f � r (SPECIAL) J III CITYICOr�.� -►1-'►1 Iff1OF"hIAT,1, , MRIDA SLUCT July 7, 1981 r I t�IANCE ORouI nlay No, PAGE N0, CABLE T.V. PRESENTATIONS BY BIDDERS I 1 1 - 72 4 6 MINIMS Or SPECIAL MEETING OF THE CITY COMMISSION OF MIAMI, FLORIDA On the 7th day of July, 1981, the City Commission of Miami, Florida, Met at its regular meeting place in said City in Special Session to Consider business of public import. The meeting was called to order at 2:35 o'clock by Mayor Maurice A. Ferre with the following members of the Commission present: ALSO PRESENT: Commissioner J. L.Plummer, Jr. Commissioner Armando Lacasa Commissioner(Rev.) Theodore Gibson Mayor Maurice A. Ferre Howard V. Gary, City Manager Vince Grimm, Assistant City Manager George F. Knox, City Attorney Ralph G. Ongie, City Clerk Matty Hirai, Assistant City Clerk An invocation was delivered by Reverend Theodore R. Gibson, who then led those present in a pledge of allegiance to the flag. 1. CABLE T.V. PRESENTATIONS BY BIDDERS. Mayor Ferre: Good afternoon, ladies and gentlemen, this is a Special City of Miami Commission Meeting for the purposes of hearing the presentations from the five applicants for Cable Television and it is scheduled as a public hearing. Now, I would like to ask the Manager to please have a police officer in the back of the room, because I got a feeling that we are going to have all kinds of conversations going on as they are now. Would you make sure that we have somebody back there until a police officer gets here to keep everybody quiet back there? Mr. Gary: Yes, sir. Mayor Ferre: We unfortunately, do not have sufficient room to hold everybody that, evidently, is here and there is not much we can do about it. You are welcome go up stairs. There is a gallery up there, unfortunately, however, you will not be able to hear because there is glass ana _:iere is not much air conditioning. There is some and we got fans up there, but, of course, we can't force anybody to do that. I see that our colleague from Miami Beach, Murray Myerson is here. You are not here on an official capacity, you are here as an attorney? I see, there is a seat right up here, Mr. Mayor. Jeff is that taken by... Rev. Gibson: What about the next one. Mayor Ferre: Thank you. Rev. Gibson: Mr. Mayor, may I ask of you... I hope Mr. Mayor, you would say to this audience what our rules are and what have been passed. Mayor Ferre: Yes, sir. Rev. Gibson: As to number one, who goes on first, second, third, fourth, and fifth. Number two, how much time each person has. You know that in front and when that time comes I hope we will cut off even my right hand. Otherwise, 0 01 -JUL 71981 We will leave out here with one person being dissatisfied that he or she was not given the same amount of time as the other. And finally, as you explained they will know what the rebuttal time element is and that they will keep in mind that when that time comes that, that's exactly what we are going to do. Mayor Ferre: Yes, sir. We will... let me outline what the Commission has adopted as a procedure. We will have... alright, now, we have five people that are going to make presentations. We had at the last Commission Meeting by a selection on a piece of paper, selected the first, second, third, fourth and fifth presenter. There is an order that has been establised to that end. We also have an equal amount of time. That is half an hour for each presentation, half an hour for each rebuttal and the question and answer period and I will allocate five minutes for opening rebuttal remarks, if any, and then, we will get into twenty minutes of questions and answers from the Commission during that half hour period. I will ask the Clerk to put on the lights. The green light will go on for twenty-five minutes, on the twenty-fifth minute the red light will go on and that means that you have got five minutes left. When your thirty minutes are up we will let you know and that light will start to blink and I will let you know that your thirty minutes are up. Now, since we have two and a half hours of presentations assuming, plus, the time that it's going to take to set up, I assume that at best that portion of the afternoon is going to take three hours. We also, have to break to have some food sometime between now and midnight and I would recommend that we take an hour off and my estimate is that, that will be around 7 or 7:30 or 6 o'clock and that we will take an hour off so we can all go out and have something to eat and come back and then we will have the second three hour portion. That is half an hour for each... for questions and answers and rebuttal. Obviously, at that pace we are talking about at best, winding up around 11:30. Now, I would like to say that I must go to Puerto Rico tomorrow and my plane leaves at S o'clock in the morning and I am walking out of here at midnight sharp tonight. I will be walking out of this room at 12 o'clock tonight. This is a public hearing that's scheduled at 4 o'clock. Now, it is now quarter to three. We have our consultant, who is here with us, Telecommunications Management Corporation. He is going to make a presentation, hopefully, a briefer portion than what we got last time and I would like to know at this time, how many people are here from the public, not from the aspirants who would like to speak at this public hearing? Is there anybody else here that does not represent a corporation? I see one hand. Are there any other hands of people representing the public that wish to speak? I see ten, ok. Yes, I saw Dr. Robinson. I see ten speakers. Now, if we can get through your portion of it in half an hour to forty-five minutes. I would like to see... does anybody need to speak more than three minutes of the ten people that... that would be thirty minutes. Does anybody need to speak more than three minutes? Alright, let's see if we can get on with this rather quickly. In the meantime, let me... there is one more thing that I wanted to say. For those then that are here to speak on public issues when the City of Miami Commission votes in its majority for the selection of a firm to put in cable t.v. in Miami, the Manager will be authorized to begin negotiations. During those negotiations, we will recognize the input of Barry College, Florida Memorial College, the University of Miami, FIU, the group representing now, which I have gotten telegrams from for a all women's channel and to represent the feminine viewpoint and the other people such as Channel 2, Public Television, minority representation, etc. The Manager, will communicate with each one of these special interest groups and will have them as part of the process, so that their interest, if possible, can be taken into account and included if it serves a public purpose. And I am sure that to that end we will have a series of public hearing where people from the community will present with that portion of the negotiations that deals with neighborhoods, ethnic groups, educational purposes, etc., we will try to accommodate as many as we can at that time. So I say all of this because to save perhaps, a little time for those of you that are going to come up here and say you want to make sure that the Black Community is represented, the Cuban Community has something, that the neighborhoods, that the women's movement, etc., etc. We are going to be getting into that. This perhaps is not the time. I would hope that you would limit your statements to the three minutes that you have and make them as crisp as possible. Mr. 1'1`immer: Mr. Mayor, May I? While you were talking, we had a memo placed in front cf us dated the 29th of June. Is this memo still a prevailing factor? 02 JUL 71981 I A Mayor Ferre: Alright, let me see what you are talking about. Mr. Plummer: In particularly, Mr. Mayor, as you are aware, I missed the last meeting due to a previous commitment which I announced at the time of the poll and one of the things that I'm uncertain about is, once again, I am reading that we need to set a date and time for a third public hearing on July 14th at 4 p.m. as suggested. That was my understanding, but in some discussion of the transcripts which I read there seems to be some mixed feelings. 'Now, it was my understanding from the initial onslaught of setting dates, that we were in fact, going to have meetings on the 7th and the 14th and I see it here again, in a memo dated after tha meeting and I'm asking what is the concensus. Mayor Ferre: J. L., I would like not to preclude this Commission from doing whatever this Commission wishes to do at the conclusion of this whole process. Now, for myself, if we can get through in time, I think it's open to any recommendations that the majority of this Commission would want at that time. The probability, in my opinion, is that when we get through with this hearing I think it will be very close to midnight and I think we are going to have to continue it, that's my personal opinion. Mr. Plummer: Mr. Mayor, I have never argued with the fact that three votes of this Commission is the majority and as such rules. I am only asking for the clarification at the time that we set the dates when you say you are going to have the public hearings on the 7th and the 14th. I don't want anyone mislead. Mayor Ferre: Yes, sir. Mr. Plummer: Alright, sir? And that's what I'm saying now, that the date of the 26th of June was setup for the purpose of the consultant to make his report and the 7th and 14th were setup for the purposes of public hearing. Mayor Ferre: Now, for example, if we don't get through and we have to continue this for some reason or another, we don't... there may be one and it gets close to midnight and there may be one firm that hasn't had it's half hour, I would have no problem... I cannot... I have got to be in Puerto Rico all day tomorrow. We have a Commission meeting on Thursday, I would be happy to meet on Friday or any time next week, if that's the will of the majority of the Commission. This is such an important decision that I, as the Chair will rule unless I'm otherwise ruled by three members of this Commission that we will only meet when we have all five members present, because I think it's much too, important a decision for three or four people on this Commission to make. Mr. Plummer: Well, here again, Mr. Mayor, I'm just asking because even after the meeting after the 26th, this memo is dated the 29th, three days after and this memo once again, is suggesting there will be a meeting on the 14th as a public hearing. Mayor Ferre: Well, that is... that sir, was the schedule that this Commission adopted and until this Commission adopts another schedule in a formal way, that's what the Administration is instructed to do. Mr. Plummer: I understand fully, Mr. Mayor, thank you. Mayor Ferre: And you know, we will decide that later on tonight as to when the next meeting is. Mr. Plummer: Well, you see, that's where I got a problem though, Maurice. Mayor Ferre: Tell me what your problem is. Mr. Plummer: Look, I don't think anyone on this Commission, a majority or otherwise, wants in anyway to be accused of scheduling public hearings and then cancelling. Now, that's the problem that I have, ok? Mayer Ferre: This is a scheduled public hearing. Mr. Plummer: Correct, and so was the 14th. Mayor Ferre: The Charter says that this Commission has the authority to 03 J U L 7 1981 E Continue any public hearing. Mr. Plummer: I have no problem. Mayor Ferre: If we do not conclude the presentations, I have no objections and as Chairman I will rule that we will continue it at the next available date when five members of this Commission are available to me. At the worst, it will be on the 14th. I would hope we could do it before then, ok? Mr. Plummer: I understand. Mayor Ferre: Are there any other procedural questions from members of the Commission or... Mr. Plummer: The only other question, Mr. Mayor, I assume now what you are going to do is to hear from the ten people who wish to speak. Mayor Ferre: No, sir, we are now going to hear from the consultant who was scheduled at 2 o'clock for two hours, from 2 to 4. The public hearing, the advertised public hearing officially does not begin until... is it 4 p.m., Howard? When does the public hearing begin? Mr. Gary: Yes, sir. 4 o'clock. Mayor Ferre: Yes, ok. We now have an hour and five minutes to that point and what I am going to do is, I am going to recognize Mr. Carl Pilnick, who is our consultant. I would ask him to try to limit his statement to half an hour and then I will try to give a three minute crack at the public hearing portion of it to ten people in the audience who wish to speak. Mr. Carl Pilnick: Thank you, Mayor Ferre and Commissioners, I will try to keep my remarks even briefer than the time that you said and basically,... Mayor Ferre: Excuse me, Mr. Pilnick...(CO1,I2U:NT OFF PUBLIC RECORD). Mr. Pilnick: Mr. Mayor and Commissioners, what I would like to do is spend a relatively short time giving you a brief overview and perhaps I might repeat some of the material that we went through last time, but I would like to leave majority of the time open for questions from the Commission, because I think that would be the most useful. As you all are aware, we evaluated with the applicants proposals and submitted an initial report to the City which you all have a copy of. Each of the applicants was given the opportunity to respond in written to our evaluation and to make any criticism or complaints that they wish to and we then responded to those complaints and submitted a second report to the City. Both these reports are public. The applicants have them. They are available to members of the public. We were asked by the City in our evaluation to evaluate the strengths and weaknesses of each proposal with respect to the criteria that were listed in the request for proposals that the City issued and that basically, is what we have done. We were also asked not to rank the companies in any one, two, three, four, five order and we have not done that. I wish to point out in general that you have five good applications and we don't consider any of them of such a nature that the applicant should be disqualified. We think all the companies are financially and technically able to give the City of Miami a good cable system. That doesn't necessarily mean that we think that all the proposals were equal, but it does mean that we think that the five companies are qualified. You have listed in your request for proposal some nineteen or twenty criteria that we used to indicate where we thought the applicants were strong or weak and again, I would like to point out that in my opinion all those criteria are not equal in importance to the City. Some of them may be much more important than others, so that if you review the areas that the applicants were rated in terms of strengths or weaknesses, I think you have to decide on your own which of these particular criteria are most important so far as you are concerned and perhaps look at those a little bit more carefully than you might look at the total number of strengths and weaknesses. I think that I would like to repeat the one thing that I said last time, that I believe that once you select a company, regardless of which company that we do select, probably the most critical asnPrt is the period after you make your selection and that's the negotiation of a :.,:'LLully satisfactory franchise agreement to what the company select, because that's the document that will give you whatever enforcibility you have to be able to have a good degree of confidence that whatever had been promised you, you actually will get. And I,think I indicated before that I don't feel 04 JUL 7 1981 that simply relying on one drastic penalty like the ability to revoke the franchise is sufficient. In most cases it's a penalty that will not evoked and as a result, you don't really have much power. If you don't have a range of flexible penalties that can be applied to fit any particular violation of the franchise agreement. I won't belabor that point, but I think it is critical. Perhaps as critical or more critical in selecting the right company. We indicated last time that, that negotiation process can be, if it's planned properly, can be completed reasonably quickly. In meeting with the City Manager since that time, I have estimated that perhaps a two month period would be necessary from the time that you make your selection to the time that a drafted agreement can be brought back to you for your review and approval. It possibly can be done in a shorter period of time, but I think that, that time is realistic. I think that, with respect to specific strengths or weaknesses of the report and our second response try to justify, at least in our opinion, why we allocated strengths and weaknesses. I will point out again, many of the items that are evaluated are not the kind of item where there is an absolute right or wrong decision. There are matters of opinion and some of the comparisons are relative. You may have one company offering you something good, but if another offers you something better, it may be the company that is only offering something good may have received a weakness in that particular area. So, that you have to look at these with respect to what all five applicants are proposing in each particular area and if something is listed as a weakness, that does not necessarily mean that, that's a poor proposal. It simply means that in our opinion, it's not as good as the features that are being offered by one or more of the other applicants. what I would like to do, if it's the pleasure of the Commission , is take as much time as you would like to answer any specific questions you have. If you want me to go through the criteria and our reasons for individual rankings, I will be happy to do that, but I think it might be more fruitful if I try to respond to your questions. And I also would note that if during the question and answer periods in the presentations later, if you wish me to comment or clarify on any particular question or answer, I will be very happy to do that, too. Mayor Ferre: Alright, I would like to give the opportunity to J. L. Plummer and Joe Carollo who are not here because they had previous problems which precluded them the opportunity to ask questions first and then the three of us that were here can come in later on if there are any other questions. But before we do that, Mr. Clerk, were the transcripts written and... Mr. Ongie: They were written and distributed to all members of the City Commission and the Administration. Mayor Ferre: what day were they distributed? Mr. Ongie: I believe it was last Wednesday. We did it immediately. Mayor Ferre: Last Wednesday, today being Tuesday. Thank you. Ok, questions? Mr. Carollo: Mr. Pilnick, now that you have us completely confused from your... the start of your presentation. I, for one, would certainly appreciate it since what you are basically, is saying that in some many ways all the companies are equal. You feel they all are good companies. If you could expand your presentation into the areas that you described before we would start asking questions of you. Mr. Pilnick: Alright, I don't think I said or I didn't mean to say that I thought all the companies were equal. I said, I think all the companies are qualified and I think there are significant differences among the proposals. One area of significant difference is what you might call the extras and by extras, I mean that there were some questions in the request for proposal that open the door for the companies to propose what they wished in such areas as public benefits, commitments that they might make to public agencies, commitments that they might make to the community with respect either programming support or facilities, training. Those areas where the applicants in effect, were allowed to use their own discertion in what they proposed and I think in those areas, if you will look at those categories listed in our report, I think you will find that among the five applicants there were significant differences, that some of the applicants offered additional benefits that amount to a s;'l�Laztially large number of dollars anyway you want to evaluate them. Other applicants did not. That doesn't mean that the applicants could not build a good cable system for the City, it means that some of the applicants are offering something over and above the minimum. In the areas of system design there were some differences. Now, I think that we tried to indicated which 05 JUL 71981 0 features we felt were better. I don't know if you could say that there were major differences in that area. There were smaller differences in the area of programming. There are differences in the area of experience. Where some of the applicants having national experience with a large number of systems, some other large city systems, other applicants having more limited experience. so, that without going through each item, what I am trying say and very carefully is that I don't think that the proposals are equal. I think that you have got a high enough level in the proposals so that even if you picked what you might consider the worst you would be getting a good system, but not necessarily the best. Mr. Carollo: I don't know how the rest of my colleagues would feel, but I, for one would like to go through the positives and negatives that you have seen in each company in grading them as such and go down the line company per company as to why you graded them that way. Mayor Ferre: Ok, Mr. Pilnick, as I... remember you and I talked about this yesterday. Would you do it in the form that we talked about so that... Mr. Pilnick: I will try to be as brief as I can, I realize the time constraints we are operating under. If we start at figure two, in our original report we have a list of figures from that point on where we evaluate strengths and weaknesses. If I rush through these and if you want to stop me at any particular point, then, please do. Mr. Carollo: Can I stop you for a second, sir? Mr. Pilnick: Sure. Mr. Carollo: I would hope that all my colleagues would feel as I do that we are not rushing you for time. This is one of the most important things that this Commission is voting upon and I, for one, feel that whatever time it takes for every member of this Commission to be sure on what they are voting on is all the better. So, sir, as far as I'm concerned you have all the time that you need to go through this. Mayor Ferre: Ok, I would agree with that, because this is much too important a decision and if any member of the Commission does not feel comfortable, I think that Mr. Pilnick should go into this as deeply as any member of this Commission wishes. So, you proceed. Mr. Pilnick: Yes, sir. Alright, starting with figure two, this figure analyze the financial capability of the various companies. Now, again, I will just make one brief comment, what we are analyzing is what they have in their proposals. We are not really evaluating companies, we are evaluating what the company proposed to the City of Miami, so that there may be other factors such as the track record of a company in some other city that are not included here. We are not making a judgement that a company is the best, we are making a judgement that the proposal may be better or worse than another one. Mr. Plummer: Well, can I stop you for a moment, sir? Mr. Pilnick: Sure. Mr. Plummer: Because I will tell you, I have a real big problem with that and I will tell you why, you are the technical expert in this field, I am not. Now, in no where in reading the transcripts of the twenty-six meeting that I see any indication by you that these systems as proposed to the City of Miami, rating them with others across the country. Now, let me tell you my impression right off the bat, one of the things in all RFP's that this City puts out is that this Commission has the right to reject all bids. That's one clause in every bid that is submitted and I have no information here to tell me how these bids stack up against other bids in other cities or even what I would call an average across the nation and that trend follows all the way through and one of the questions that I was going to ask you later on down the line, was how do these stack up against other cities and other bids. na--::r Terre: J. L., as I recall, Commissioner Carollo had asked a question..... Mr. Plummer: Well, he made the statement. Mayor Ferre: ... Mr. Pilnick was in the middle of answering it, after he 06 JUL 71981 V E finishes answering Carollo's question, after Carollo is finished with his line of questioning, I will then turn to you and give you the same opportunity. Mr. Carollo: J. L., by the way, that's one of the other questions that I had and I agree with you. so, if you could just bear with... Mr. Pilnick: Let me respond to that question first. I indicated before that I thought you had very good bids. By very good bids, I mean in comparison with proposals that have been received by major cities over the last year or two. I think that with respect to system, design, capability, with respect to programming, that you are getting pretty much everything that major cities have been offered recently. I would make this as a general comment and that is that most companies in the franchising competition now are basically, upping the ante every new city that they have been to and as a result, if a company loses a bid for the City of New Orleans three or four or five or six months ago and they bid to the City of Miami now, they will tend to offer the City of Miami more than they have offered the City of New Orleans for two reasons. First, they were unsuccessful before and they may have to... they have to believe that they may have to offer more. Secondly, they are in competition and all their competitors know what they have bid in the other cities, so that as a general rule, the last city, if it's considered desirable, in most cases offered more than the previous cities. So, that at the state of the art now Miami has as good... at least several of the bids are as good or better than what has been offered to other cities. If you select a company and a;,other City like Milwaukee or whatever as a competition six months from now, they may very well be offered more than you are getting. Not necessarily because they are more attractive, but simply, there are fewer large city franchies available and the bidding price goes up. So, I think you can take it more or less as a fact of the cable industry that at this period in time because you are a major city and there are not too many of those franchise left, you are being offered by most of the applicants, I wouldn't say all, but by most of the applicants you are being offered as much as other major cities have gotten. Mayor Ferre: Well, you got to finish that sentence. Mr. Pilnick: Well, I don't think all the applicants are offering you as much as applicants have offered to major cities. I think there are differences between the five applicants and what they have offered the City and I have tried to say that before. I think that in some of the five proposals that you are considering there is good or better than what I have seen in other major cities in the last year or two, in some of the proposals they are not. Mayor Ferre: I think what Commissioner Carollo was asking you and I will just, you know, ditto that and that is, I think you are going to have to be pretty explicit. Mr. Pilnick: Well, I will. What I had hoped to do is, in going through each of these criteria and explaining why I consider something a strength or a weakness, I think by the discussion of the weaknesses you will be able to see why we consider some of the proposals not as good as the other. Mr. Carollo: Not only that, but on Commissioner Plummer's question, which is one of mine, wasn't that part of what this Commission should have gotten in it's report from you for us to have more of an in depth comparison with other major cities? For instance, compare what is being offered us to the franchises that have been offered already in whatever major cities have them at this point in time? Mr. Pilnick: We were asked, sir, in the scope of our work, we were asked to evaluate the proposal with respect to strengths and weaknesses and specifically relate them to the criteria that were listed for evaluation. In your RFP you have a number of criteria listed and you indicate there that, that's the way the City was going to evaluate those proposals. There is nothing in there that says you are going to compare them with what other cities got. I will be happy to give you that information, but I think you have to realize that in your ground rules that you sent out for the companies to bid, there is nothing there that indicates that one of the rules would be to compare what they are offering with what they may have offered to another city. Mr. Carollo: I would just feel that since you are saying that it seems that every time the companies bid for a franchise in a city they are given more. 07 JUL 71981 E E Mr, Pilnick: Yes. Mr. Carollo: That it would only be logical that in the report that you gave to this Commission, that there would have been some comparison to other major cities included. I don't see how that would have in anyway had hampered the report that we got in anyway. Mr. Pilnick: It wasn't that we deliberately left it out, we just weren't asked to supply it, but I will be happy to do that. I think the question still would be, which one of the five proposals you have is best or is any of them good enough, so that if you are willing to accept it as a basis for negotiation. I'm not sure that whether a company offered more or less to some other city is the important issue, but I will be happy to give you whatever information I have... (COt•MENT INAUDIBLE) . Mr. Carollo: Well, what I want to see is how the companies are bidding in the City of Miami, what they are offering the City of Miami stacks up to what other companies that have won franchises have given to other major cities. Mr. Pilnick: Alright, I think the main areas that would tend to answer that question are at the end of this comparison chart, essentially, those areas that are called commitments to the City or relation to needs of the City of Miami. Those are the areas what you might call, if you wish, the extra public benefits areas. I think in the areas of system, design, programming, technical standards and so forth, that essentially, the applicants are bidding what the state of the art permits them to bid right now. And the main differences are and what you might call the special benefits that they are offering the City of Miami. I will come to that when I go through this list. Rev. Gibson: May I ask this? Go point this out. If what you are saying is correct, then if you put these five firms together, these five firms will not be at this moment and time, will not be judged equally because, if a firm is just beginning and does not have the experience and has not been given the latitude or the trial method, it starts out with a great disadvantage. I think you will have to agree to that, because what experience teaches you, you up the ante as you go. Therefore, if each firm or company has the ability to furnish certain fundamental needs, we the Commission who must deal with that intangible, I say that for the reason that has soon as we make a decision, the newspapers will come to us, "well, look, why in the devil did you award a contract to company one over against two?" Now, politics has taught me that and I want to make sure, I'm not necessarily... I want to make sure the public understands that, that if company "A" went to New Orleans and found out that their ante wasn't good enough, when company "A" comes here... and at that rate... and I want to point this out as a decided disadvantage. At that rate or in so doing, one company or two companies will end up as been experienced all over this country in my sixty-five years of living, that two or three companies hog up the market. You have to admit that Theodore Gibson is right. Isn't that true? Mr. Pilnick: I would agree partially with you, sir, but... Rev. Gibson: But the partially that you are going to agree has an overwhelming we!,'-t. That's the point I make. As a politician I understand that. Now, the rest of these guys and I'm sure they aren't unaware of what I'm talking... I see the Mayor of Miami Beach nodding his head and smiling, which means to me "Glory Hallelujah, you are right." Isn't that what you say Mr. Mayor? You darn right, go ahead. Answer it as a professional. Go ahead. Mr. Pilnick: Yes, sir. I think in a business that takes as much money as the cable television business, we probably will see a trend as you indicated of the supermarket eating up the mom and pop grocery store. I think that is inevitable to some extent, but I don't think that's the whole answer with respect to the proposals that you have got here. First of all, everybody in the cable business, whether or not they actually participate in proposing to other cities knows what's going on. There is trade information available, copies of these proposals that you have that are publicly available in every ot.Y.,j city. You can go to the City Clerk's Office, you can write the City Clerk's Office if you want to pay for the xeroxing cost you can get a copy of what everybody has proposed. So, there are no secrets and the company that's new and starting in can learn that information just as well as a company that's been in the business a long time. Secondly, we are talking not only about experience and dollars, we are talking about public benefits. We are talking 08 JUL 71981 what does a cable company willing to offer the City and that doesn't have too much to do with whether the company is big or experienced or inexperienced. It's a question of how much they think they ought to share or how much they think they have to share to get a franchise and it's a question of not saying I going to put everything in my own pocket, but as a public franchise in which the City is granting, maybe some of these benefits have to be returned to the City. And so, I think there is a big difference in the area of what each company is proposing to give the City over and above the ability to build the system and run it. And I don't think that has anything to do with whether you are big or small. Mayor Ferre: Alright, Commissioner Carollo, further questions? Mr. Carollo: Mr. Mayor, I don't believe the gentleman has still gone through the process that I asked him to do, go step by step in the positives and negatives of each company. I would like, if we could, at this time to go into that. Mr. Pilnick: Fine. Coming back to the original report, the first item that was looked at was financial capability and basically, we look at how much money the company has available to itself, itself and it's parents, that's equity money and how much money they can borrow. Usually, the two are related. Because usually and it's an unfortunate fact of life, the more money you have the more money you can borrow, so that equity and debt are not completely independent, but we look at both sources. So, we look at the equity available for this particular project, what the company has committed and we look at the amount that they have claimed that they can borrow and we try to see if there is any proof that the amount they claim they can borrow actually is available to them. In terms of equity resources, we felt that four of the five companies indicated sufficient equity, not only to build the system, but enough to have a sufficient capital in reserve in case there was a need for additional money. We felt that one of the applicants, Americable, at least in the information that was provided in the proposal did not inidicate where additional equity funds would come from. Since that time in their critique of this report they have provided additional information, but they did not provide it in the original proposal. We looked at the financial plan, how much money will their own as compared to how much they borrow. and generally, the higher the amount you borrow, the more vulnerable the system is, because if you don't get enough revenue or if the system cost you more than you anticipated, then you may have a need for additional funds, you are carrying at a very high debt service burden, a high interest rate and a lot of money that has to be paid even if the revenue that you expected didn't come in. So, that above some debt equity ratio we consider the system a little bit more vulnerable and we call that a weakness. That doesn't mean, again, that you can't build the system by borrowing a lot of money, but in this particular case one of the applicants, Sixstar Nealson was proposing a 3.2 to 1 debt equity ratio which meant that for every dollar of equity money they would be borrowing three dollars twenty cents to build the system and that leaves you a little bit more vulnerable if the system doesn't generate as much money as you expect. So, we consider that a relative weakness. We looked at the question of commitments to other systems, because no matter how much money you have, if you also have a lot of it obligated to other new cable system franchises that you have received and :.-,ten't built yet or to rebuilding some of your present systems and even a company with a lot of money can be strained. So we took the amount of dollars that was commited to new systems, it was part of their proposal information and divided that into the amount of equity that the company had and tried to see, again, as a rough comparison, which companies were coming fairly close to maybe straining their resources even with a lot of money available and in that particular case we made a judgement that Cablesystems was at the point where their large backlog might perhaps be one factor in making them a little bit more vulnerable in the future if they were to get a number of other new major franchise or to have some financial reverses that we felt that on a relative basis they are operating closer to their available resources than perhaps some of the others and they disagree with that. The next item that we looked at was the construction schedule and here there was not too much separating the five companies, but three of the companies proposed to complete the system construction in two years, two of the companies proposed to take the better part of three years and we assumed that the companies proposing the two year construction schedule would be more desirable to that City. We call that a relative strength. We call the three year schedule a relative weakness. Again, you have to realize that there are a lot of factors involved here. You have got utilities involved, Southern Bell and the Power 09 JUL 71981 E 0 Lotnpany and you have to have their cooperation to make space available on the poles. The cable company is renting space from them. If they drag their feet, they could slow up the construction of the cable company. Mr. Carollo: If I may interrupt you for a second, sir. Mr. Pilnick: Sure. Mr. Carollo: You have some companies proposing two years, some three years. Mr. Pilnick: Yes. Mr. Carollo: Realistically looking at it, what has been the average in a major city throughout the country? It's been two year? Three years? Four years? Mr. Pilnick? The average has been longer than they promised in most cases. And that is that I think you are getting optimistic projections from all of them, but again, I think that one of the recommendations we make is that in the final franchise agreement you put very, very substantial penalties on this. The first order of business I think is to try to decide who is offering you the best proposal. The second order of business, try to make sure you are going to get everything they are offering and so, I don't say just rely on a promise of two years and accept .:hat. I think that's the wrong thing to do. I'm saying if a company commits to two years, before you sign a franchise agreement they should be willing to incur some very substantial penalties if they don't meet that two years guarantee. And assuming that all companies are willing to do that, then I would say a two year promise is better than a three year promise. Mr. Plummer: Well, but, you see, this is where I got the whole problem with this report. You didn't answer Mr. Carollo's question. Is two years realistic? Mr. Pilnick: Two years is realistic if you get faster cooperation from the utilities, that has been the case in most cities. Mr. Plummer: So, then, for a person who you felt was in the three year category is penalized for being more truthful? Mr. Pilnick: No, sir. They are all basing the construction schedule on the start of construction. Construction doesn't start until they get all of the clearances from the utilities. So, they are all using the same starting date. The question is, how long are they going to take to build the system. Some of them have claimed that they will build it in two years. Some of them have claimed they will need three years to build it. Now, I'm making a judgement that two years is more desirable for the City than three years if you can make them meet their promise. Rev. Gibson: I have a question in my mind. I would hope that when we begin to negotiate and agree, that the running time will depend upon the accessibility from the two utility companies that they must deal with. Because one of the things I think, I know will happen, is it depends on who can exert the greater amount of pressure on the utility companies. They will drag their doggone feet adinfinitum. And I would hope that this r-mmission would commit itself to say to Southern Bell "We can't run your business now, but there will be a day when you are coming back to us." And we will say the same thing to Florida Power and Light. They understand that. Now, I think befor we make a judgement, we ought to make a commitment to do just that, because I see now that they will make this company run, you know, three years waiting, two years waiting and all that business. I hope that's on the table. Mr. Pilnick: I think you are right, Father Gibson, I think your City Manager office from what I talked to him about has already started discussions with Southern Bell and Florida Power and Light to try to expedite the process. Alright, the next item that we had listed was technical standards. I think all of the companies are proposing state of the art technical standards. They are all hacically, buying their equipment from the same limited number of sources, wo k.Aw.,'t see any significant difference in that area among the applicants. There were a series of categories that dealt with programming and the RFP broke the programing categories into several groups. One was called "ultimated service and by automated services we are talking about bulletin board type text services and another category was called "Special interest programming". 10 J U L 7 1981 h the case of programming, the general rule of thumb that we used was, the flare the better so far as the subcribers of the City are concerned. Cable systems have a tremendous amount of capacity and our feeling is that, I can't tell you whether program "A" is better than program "B" for the City. I can't tell you which ones you should have and which ones you should not have, but we can, I think, feel that a company that is offering more choice of programming deserves a strength compared to a company that's offering less choice. So, that the general guide rule that we had in evaluating all the programming was, are the residents of Miami being offered all the choice available? And those companies that offered more choices got the strength ratings and those that offered less choice got the weakness ratings. Now, there is one exception to that and that is the area of locally generated or access programming. The kind of programming that a cable company would not do itself, but would prcvide facilities and channels for community groups to do. I think there if a company says we are going to allocate thirty channels and make those available to community programming and every small group will have it's own channel, I think that's a shell game. I think that, that is not a sincere offer in the sense that everybody in the business is aware of how much time and it takes to generate even a few programs and so offering a lot of empty channels and not really doing much about making sure that the community groups will utilize the channels properly is simply designed to impress whoever is making the decision of getting franchised. So, I think the key fact with respect to the local access and the community program channels are not so much how many channels they are offering, because you can get more than you can use, the key fact there is, what facilities they are going to provide in terms of dollar: and how many there will be, how available they will be and what's important they will provide in terms of training or in terms of working with and supporting various community groups and so, here we did not rate on the number of channels that were being offered, but mostly on the support facilities. Rev. Gibson: May I ask a question? Mr. Pilnick: Yes. Rev. Gibson: I heard what you said and I think I understand. What really bothers and troubles me is that, what you didn't tell us is that we are entering into a program that has a flavor such as perhaps is not found any where else in the United States of America and I hope before you, as you were ready to turn to the other page, I hope you will back up a little, because we face in this community, whether we like it or not, tri-ethnic program and if you don't address that problem as you give us these answers and we make these decisions, we are only fooling and kidding ourselves, ok? Now, I want to make sure you address that in a fashion. If you are not prepared to do it now, before we are over with, I want everybody to understand where Theodore Gibson is coming from, because whether I do it now or it is done later, I have got to face up with it. And we are only kidding ourselves. We need to go to the other part of that core. Whether or not we need to compare the program in the City of Miami... no, whether our selection of the program in the City of Miami should be the... the norm should be set by Atlanta, Atlanta doesn't have my problem. You follow what I'm saying? Mr. Pilnick: Yes. Rev. Gibson: Therefore, I need to tins more possibility f,:r quick and immediate action so that as my consultant, I hope you will address in that negotiation process just that issue and tell me whether I'm being a fool. You follow what I'm saying? Mr. Pilnick: Yes. Rev. Gibson: That's most important to us dollars and cents because all of them is what we do and deal with people make all follow me? Mr. Pilnick: Yes. contrary... don't tell me about the going to give us some money, but the difference in the world. You Rev. Gibson: Ok, that's what I'm paying you for. Tell me. Mr. Pilnick: Alright, well, let me go through very briefly again, on page ninety-nine, figure six of our report where we talked about local origination 11 JUL 7 1981 0 programming. Now, local origination is a term that the cable industry uses to mean those channels that the cable company is responsible for putting programs on. Not the community groups, but the cable company itself. I will come to the other kind of programming in a moment. And as you might see on figure six, Americable,for example, proposes to have two local origination channels. One that's just generally called "Local Orgination", one that's called "Sunshine State" which is a lease service programmed by others. Cablesystems, the second competitor proposes a program of the Americas channel, Miami Women channel, local religious channel, inflation station channel, presumably consumer type programming, Miami Channel, the hearing impaired and seniors channel for the people with hearing problems or senior citizens, a Miami together channel, a Beau's Art class and movies channel, crime watc1► channel and local Black programming channel. Presumably, if the company means what it's proposing all of those channels would be programmed substantially by them. They would take the responsibility for providing programs. They might do that by getting together with local groups, but they wouldn't sit back and just wait for someone else to come and produce the programming. They would have an active and responsible role in those particular programs. Miami Telecommunications proposes a friendly city channel. Telecable is on a Miami channel and at the track channel, State and Regional views channel, a Miami poll channel, a comunidad hispana channel and executive news report channel. Sixstar Nealson proposes family features channel, which is movies, a hearing impaired channel, sports and theatre channel, .-)asic skills channels. Vision Cable proposes an English local origination channel, a Spanish local origination channel and a Black oriented local origination channel and a handicapped local origination channel, narrow casting channel, which is essentially programs designed for specific neighborhoods, where only that neighborhood receives it, and an English movie channel and a Spanish movie channel. Now, as I indicated those are the channels that the cable company is saying in it's proposal they would program. Then, you have a large number of channels that all of them are making available for community groups to program and here as I indicated, it's not the number of channels that really is meaningful. I think with respect to community groups, if they all shared resources and utilitized one or two channel initially to develop programming and built up an audience that would watch these and know that there is something on everyday or every week in a particular spot on a particular channel and then develop and get more channels from the cable companies as they needed them, that's a much better approach than a particular group asking for its own channel and only being able to produce one program a month, so that every time you flick the dial, pass that channel you see nothing and as a result nobody ever looks at the programming of that channel. So, that I think when it comes to community groups using the cable television system, I agree with Father Gibson. I think it's very important to do that and to do it successful, but the way you do it successfully is not to just throw empty channels out to the City. It's to set up a plan and that plan requires support and it requires continuing support, not just until you get the franchise. It requires support over a long period of time. Some of the applicants are proposing to do that. When I come to some of the features in the end I describe what they are proposing. In terms of access facilities and support, figure eight, what we looked at there was three particular items. We looked at the dollars they said they were going to be putting into providing television cable casting equipment and that provides the facilities to use the system. We looked at the staff that they said tiLey were going to have Ay year six or any particular year in the franchise and the size of the staff and the dollars that they are going to be spending to pay for that staff is another indication of how serious they are in the local programming effort. And we looked at the percentage in the budget that the companies are offering to allocate to help other users. Access users and community users and we took that as a third indication of how serious their access effort was. In these three areas, we found for example, in terms of capital equipment four companies Cablesystems, Miami, Sixstar Nealson, Vision were all considered strong. In terms of operating budget, the amount that they allocate to run the equipment, we found that three companies Cablesystems, Miami Telecommunications and Vision were considered strong and compared to the other two. Mayor Ferre: You want to repeat that again? Mr. Pilnick: With respect to the operating budget as indicated on page hundred one, three companies Cablesystems proposed by year five to have a 1.6 million dollar budget and a staff of forty-six people, Miami Telecommunications proposed 1� million dollar budget, Vision proposed a 2.1 million dollar budget. So, that the size of the budget that was committed or promised... 12 JUL 7 1981 k Mayor Ferre: That's not what I'm reading here. What you have on page one hundred one on Vision is 1.8 and then 2.3, staff of seventy-five. Mr. Pilnick: Yes, sir, the top line is the capital equipment. That's the studio equipment and the mobile vans and that's what they would be spending for facilities. Mayor Ferre: You said 2.1, I read 2.3, operating budget and staff year five. 2.3. Mr. Pilnick: Did I say 2.1? Mayor Ferre: You said 2.1. Mr. Pilnick: I'm sorry, 2.3 is correct. 2.3 and a staff of seventy-five is what Vision had. But what I was indicating was that in the capital equipment area four companies were considered strong as compared to the fifth. In the operating budget and staff three companies were considered strong. And just a comparison, for example,... Mayor Ferre: Which was the company that you considered weak in capital? Mr. Pilnick: In capital equipment we considered Americable as weak. They proposed six hundred thirty thousand dollars which is lejs than half of the next lowest company and it's about a quarter of the amount that the highest company proposed and also their operating budget was six hundred fifty-five thousand dollars by year five, which again, is about a third to a quarter of the operating budget that's being proposed by the others. If you see a blank in any particular area where a company does not have a strength or a weakness, what that means is we consider it a company neutral in that area. We considered what it was offering was not exceptionally good, not exceptionally bad, so that it was considered a sort of a average offering and it would not show up either as a strength or a weakness. That's why, for example, Americable was shown as a weakness in terms of facilities and operating budget and staff. Sixstar in that area with respect to operating budget is not shown either as a strength or weakness which meant we thought it was neutral in that area. It had a budget higher than Americable, but lower than the others. Mayor Ferre: What is the percentage of budget for access? Same page, 101. Mr. Pilnick: Yes, what that means... Mayor Ferre: Fifteen to thirty and you have it as a weakness for Vision and for Sixstar Nealson. Mr. Pilnick: Yes. What the fifteen percent means, for example, for Sixstar Nealson, is that of their total operating budget they are committing to allow fifteen percent of that to helping community groups use the system. The other eighty percent they would use for their own programming. So, we use the higher percentages of fifty and sixty, sixty-five percent, we use that as a strength in our judgement, because that meant that a greater percentage of the total dollars would be going to help the community use the system. Mayor Ferre: Well, does that mean that Miami Cable, Vision and Americable aren't going to use any percentage? Mr. Pilnick: No, it means that their percentage is probably in between the ones that were considered strong and weak. If it was a zero percentage, we put it as a weakness. Mayor Ferre: Oh, I see, I stand corrected. In other words, you are saying that, for example, in the case of Miami it's sixty-five percent and that's a strength? Mr. Pilnick: That's a strength. Mayor Ferre: In the case of Americable that's fifty percent and that's a strength? Mr. Pilnick: Yes. Mayor Ferre: Ok, I got it. But Sixstar Nealson and Vision you see that as 13 � �v�a�chess? Mr. Pilnick: That's right. Mayor Ferre: And you have no comment for Cablesystem? ly it's Mr. Pilnick: I don't remember their exact pergccentags►but Ptobab considered as average.ewhete between the thirty and fifty percent range. Mayor Ferre: I got you. Mr. Pilnick: Alright, on the next category► a category of interactive services, figure nine, what we looked at there essentially was the kind of equipment that they were proposing to install which gives them the capability for two way services and the kinds of services they were proposing to offer either initially or sometime later and in this Essentially, area you will innotice g toi stall everybody was considered as strong. Y y all about the same kind of equipment. They are all offering security services to begin with and in some cases tax services and they are offering to provide additional services as they become feasible later on. So, that we didn't consider that it was that much of a difference between the proposals in this area and all the applicants were rated as strong. Mr. Plummer: Yes, but —hold, if you will. Mr. Pilnick: Yes. Mr. plummer: one of the comments that I saw of the Mayor in the transcript of the last meeting... I think this is a good example of where we should come to. Now, these people have all offered to do these things, what do we have in the way of holding their feet to the fire that they are going to do these things? Mayor Ferre: That comes in the contract. Mr. plummer: Well, you see, Mr. Mayor, they are talking about and I remember your comment, home education, 1963. That's two years down the pike and I think your statement in the transcript was "Well, what about if Generalo leeing tricto or Sony doesn't have the piece of equipment ready that wthe as areust as concerned and se or it doesn't work out feasibly." Now, y see, in the other way and I will get to that when I have my period of questioning, but what happens if these people who have offered these eitems and these are hey don't all strengths, I'm not talking one company opposedplus, item. do... you know, one company as I read it here is offering one , P And if you look over on the other side you see another company that's offering ten. Now, if you... you know, if you are trying to equate or to compare you would think that ten would be a lot better offer than one, unless you go into quality of program. And I'm just saying that's fine and great, I'm glad they offered, but what facilities do I have to hold their feet to the fire if they don't do it? Mr. Pilnick: Basically, the final franchise agreement and I think that, that agreement should include some protection for the City in this area too. Now, obviously, some of the services that are being talked about are stj." being developed. They may never be economically feasible even if they are technically feasible now. Banking at home and shopping at home are going through some test periods in the next year or two. We don't know if they will be economically feasible or not. So, that I don't think you would expect a company t o put in a system that's been proved to be economically unfeasible someplace else, but I think you do have the right to expect them to live up their promises in those services that do prove to be feasible. So, one of the areas that we would propose in final agreement would be what you might caltwo aars progreevery ss review capability that the City would have perhaps every Y three years where the City can review the services that have been promised originally, can review what is being offered and provided iii other majorcities and can then come back to the cable company and say "Not only did y promise that, but it is being implemented in other cities, we now expect you to live up t,, your promise." And if you then make a finding that it is within their control and it is feasible from your point of view and they don't live up to it, you then, can apply penalties. Now, it is not... it's not the most perfect arrangement in the world, because there is always going to be an agguement, but you have to realize whenever someboTnol.g that They arenotl try gherepromising their best, in which is what they are pomisi 14 JUL 7 1231 that they absolutely will introduce these services. What they are saying is, if we see these services being developed and we will as soon as they are feasible, offer them in Miami, then you can sit back and let them determine When it's feasible and they may never do it or you can try to enter the picture and have some judgement on the part of the City, as to when the City thinks it's feasible. And you could have a dispute and the thing could wind up in court or you can wind up simply disagreeing, but I think having that kind of provision in the agreement at least gives you a process that you can periodically use to stimulate the cable company and to ask them why they are not living up to their promises. Mr. Plummer: I don't agree with that theory, sir. You know, to me what's tangible and in hand today is all they can promise, ok? I can write a contract on that. I can't write a contract on what might be and one of the things that I'm going to be very adamant about is, that, that , that they can definitely produce today is the maximum scope of that contract and anything that they might want to provide in the future is going to open renegotiation at the City's authorization to allow them for a more negotiated fee on behalf of the City. The: way you have got this here or they have got it or whoever, is I'm putting it all in now and if it comes along I can say Hey, I talked about it back from day one." That's not the way I'm going to write the contract if I got anything to do with this thing. Today it's on what's in hand. I don't like the bird in the bush, I like the bird in the hand. Mr. Pilnick: Obviously, everything that's deliverable should be in the contract as a commitment. One of the reasons why we have made distinctions between companies here. You will notice that the company that's listed ten different services is essentially considered the same as the companies listed one or two, because many of these are best guesses. Right now as a general rule companies are offering security alarm monitoring services and in some cases, tax services and not much more. Everything else is of future. Rev. Gibson: Sir, I wonder if you heard what he said, because I started out pointing out to--- not necessarily you, because you have, you know, the expertise, but I started out pointing out to the public, because if the public doesn't get that approach right now, you know what will happen? When we leave here the public will say "Well, you know, I'm suprised at that Commission. The Commission did not choose the best company or the company which offered most." And I think you, the public ought to understand, because I know of another incident or another matter where we voted in a certain way, it has nothing to do with this and the public did not understand that we were faced with the very same possibility in that matter as we are faced in this. What Plummer said is very, very important. We must make our decision as you first aluded to based on the ---you used the term... Mr. Pilnick: The best offer that you have ... (COMMENT INAUDIBLE). Rev. Gibson: ... of the art in light of 1981. A lot of these companies for the public's sake are talking about futuristic production. Now, the one thing I want to promise the public so you don't call me a SOB later on, I'm not going to deal with futuristic business, because I find that to be in my living, you know, sooner or later I end up with zero. So, I'm going to hold everybody responsible for what the state of the art is in 1981. 1 want a clause in there however, where I can push the company to deal with the futuristic possibility, you know, later, ok? Mr. Pilnick: Alright, let me proceed to figure ten, which is the service to institutions. As you are aware, all of the companies proposed in effect the dual purpose network. A network that would serve homes in the City and a network that would also serve various institutions in the City and the institutional network can be used by government agencies such as City departments, schools, hopitals, businesses to communicate with each other on a private basis or to communicate with the public. We indicated that we felt that four of the designs and they are shown on figure ten, four of the designs were considered strong. One of the designs we considered on a relative basis weaker than the others. That was the Cablesystem design where they proposed to combine the institutional and the residential network on the same cable. They take a strong difference of opinion on that. I think you will hear their viewpoint probably later. We also looked at the mileage of the institutional network as an indication of strength or weakness. The more cable, the longer the cable will be. The more institutions you will in general be able to connect. So, that the companies proposing the longest institutional network received a strength as compared to the companies proposing the short networks. In 15 JUL 7 1981 q'a Channel capacity there is not too, much difference to choose between the Companies. We were asked to evaluate the companies with respect to sophistication of the system and that's shown on figure eleven. And by sophistication we interpreted that to mean the ability to provide most of the new services that either are beginning to be offered now or looks like will be offered in the near future. And that involves... offering the new services involves the kind of converter you supply to each home.... Yes? Mayor Ferre: You said sophistication of the system was eleven, I have it as nine. Mr. Pilnick: Figure eleven, page... Mayor Ferre: Page ninety-one, sophistication of the system. Mr. Pilnick: No, I think... Mayor Ferre: Figure eleven. Mr. Pilnick: I think, what you are looking at Mayor Ferre is... Mayor Ferre: Page 104? Mr. Pilnick: Yes. It should be page 104. I think you were looking at the summary of what they offered, but the listing of strengths and weaknesses is on figure eleven, page 104. Mayor Ferre: Thank you. Mr. Pilnick: All of the cable companies are proposing to supply the essentially latest, available state of the art converter which has the addressable feature, addressable feature is the ability to direct a particular communication to a particular home or group of homes. Each house in effect, has an electronic address and by activating that electronic address you can turn on or off a particular channel in the home, so that you can offer things like pay television only to those people who wish to pay for it or you can offer special programming into special neighborhoods. Mayor Ferre: Mr. Pilnick, you don't show any weaknesses here. Mr. Pilnick: No. Mayor Ferre: So I assume that what you are saying is that they are all pretty much the same, is that it? Mr. Pilnick: Yes. They are offering different kinds of equipment, but certainly at a higher tier levels, they are all offering essentially, the same capability. Alright, figure twelve, page 105, system design. We looked at a number of features that we felt were the critical features with respect to system design. You can probably look at a hundred, but we try to pick the ones that we thought were most important. One is what you call... we call the head end hub configuration and that means, how many different locations within the City will be used as distribution centers. One company, Americable, proposed one single head end, essentially, one single distribution center to serve the entire city. The other four companies either proposed a head end to two hubs or a head end to three hub and again, as we pointed out, I think, in our report, it doesn't mean a single head end is bad. I think a single head end could serve the City fairly well. But you have advantages in having several hubs. One of the advantage is that you cable out from each hub and therefore, the length of cable in general is shorter and the shorter the cable the fewer amplifiers you have and the better the quality of the signal in general. It also makes it easier to upgrade the system later on. If you want to put more channels in by replacing the present amplifiers with better ones that will be available perhaps five years from now, you normally would have to space the amplifiers closer together and if you have a long length of cable that will mean you will have more amplifiers and the signal quality will probably nuL. L. quite as good. So, that on a relative basis we gave a strength to four companies and a weakness to Americable. Two of the companies proposed at each of the various hubs to have additional satellite earth stations, which is the kind of antenna and receiver that you see outside. By having some redundancy by having earth stations at more than one location. If they happen to go out at one location or if the cables are cut or use power in one particular hub 16 JUL 71981 you can still get some service to the rest of the City. So, that we felt that redundancy was worth a stength. We took the number of amplifiers in the longest cable run and if this number gets too high that's an indication that the signal might possibly be poorer quality. All the cable companies were good in this respect and they all got a strength. They all offered the advanced features that are considered, I think, part of a modern system such as status monitoring. Status monitoring means you have an automatic way of finding out where there is trouble in the system. The same computer that might monitor alarms, for example, burglar or fire alarms also monitors the cable system to see whether everything is operating properly. Emergency alert feature is the ability for the City or some other emergency group to cut in on all the channels of the cable system and basically, be able to present either an audio or a visual alert to everybody on the cable system at the same time. And standby power is the ability of the system to keep operating from some period of time even if the power company lines go down. And we found that all the companies were strong in that area. With respect to the next figure, figure thirteen, this is channel capacity of the residential network. Four of the companies proposed essentially, the same design, that's two cables for the residential network along and all four received strengths in this area. Cablesystems proposed that one of their two cables would be shared between the institutional and the residential network, which does cut the channel capacity down and we consider that a relative weakness. Figure fourteen, page 107, experience. Mayor Ferre: Well, wait, wait, wait, before you go there. I had a question back in figure ten on milage. I see where the high milage is 219 miles from Miami and... Mr. Pilnick: Well, I think that's just the institutional network alone. Mayor Ferre: And then you have fifty-eight miles for Americable, but you don't have anything for Cablesystem, Sixstar Nealson and Vision. What does that mean? Mr. Pilnick: Well, that means that the two hundred nineteen miles was the longest and that was considered a strength. The fifty-eight miles was the shortest, that was considered a weakness. The other three had mileages. I think. in the hundred, hundred fifty mile category and they were consider neutral, not weak or strong. Figure fourteen is the category of experience and just as a guide on top, before we got to strengths and weaknesses, we listed the number of cable systems that each company operates around the country. And also, where the information was available, the number of subscribers that they are serving. Now, we looked at such items as the average subscriber rate that they are charging in the systems that they are operating now and we felt that those charging less in systems that are already operating there might be a presumption that they would be charging less in Miami, too, over the long run. We looked at the number of systems that they were operating with more than five hundred miles of plan per system, because the Miami system will be about seven hundred miles of plan. We wanted to find out, in effect, how many systems these companies were running were big city systems or large enough so they would have some experience with handling a lot different subscribers. We looked at their history in disposing franchises in the past to try to get some indication as to whether that was excessive. If the number can be considered excessive, then it might be a sign that either the company didn't have enough financial capability to operate all the systems it got franchises for or that, in effect, it was in the business of buying and selling franchises And in the weaknesses area, as you all know, we listed the rate that Americable and the average rate they showed for other systems.... (COMMENT OFF PUBLIC RECORD) - Mr. Pilnick: The average for the systems operated by the four other companies range from six dollars and seventy-seven cents a month to eight thirty-one. Americable's average rate was ten dollars forty-five cents, so we considered that a weakness. They didn't indicate in their original proposal that they operated any systems more than five hundred miles in their critique they indicated that the South Florida system if you take all the systems as one grcc:"p would total more than five hundred miles. But essentially, three of the companies received a weakness in having either none or one or two large scale systems. Two of the companies received a strength for having a fair sized number of large systems. On figure fifteen, the rates. What we looked at were two major rates that they were proposing. And again, I would just like It to snake this clear. The only rates that are really commitments in all the proposals are the initial rates that are guaranteed. All the applicants guarantee the initial rates either for three years after the franchise or until system construction is completed. There was some rate guarantee given by all the companies. That guarantee is a contractual guarantee, you can hold the company to that. Anything after that will depend upon your ability to regulate rates and will depend on whether or not,if you have that ability, you will grant them the rate increase that they ask for. So, we gave the primary consideration to those rates that were firm. And in accordance with Commissioner Plummer's feeling about wanting to consider only the items that were firm. We felt only the initial rates were firm, everything else after that is a guess. Now, the initial rates, two of the companies received a strength for having generally lower rates for basic service. Basic service is the various services you can get for one charge per month and it does not include the pay channels, the movie channels. Three of the companies received strengths for having the lowest average rates for paying television programming. On the next page, page 109, we gave three of the companies weaknesses for having higher rates in their basic service and two of the companies were considered high in terms of pay t.v. service. Now, again, all these rates are relative. We are not making a decision that says that a rate is too high, we are saying it is higher substantially than rates that have been proposed for the same service by others. Therefore, in comparison, that's a weakness. And the ones proposing the lowest rates in comparison would have a strength. Figure sixteen, which ?.s the rate stability area, what we looked at was two items here. First, what they were guaranteeing and secondly, what they were projecting in their financial projections over the fifteen year life of the franchise in terms of rate increases. Now, with respect to the guarantee, one company guarantees the rights for three years from the date of the franchise award, rather than from the date of starting construction or for the date of completion of the system. We felt that would be a comparative strength if they could be held in a franchise agreement to that specific commitment. Four of the companies took the same approach towards projecting rate increases. The City in it's request for proposals told all of the applicants to use a nine percent per year inflation rate and if you apply nine percent per year your cost go up at essentially that rate. Four of the companies assumed that rate increases would go up at roughly the same rate, so that as the cost increased, the rates would increase to balance that off and I think that's a reasonable approach. One company, Sixstar Nielson, projected rate increases that averaged maybe two or three percent for basic services per year. I don't know whether they simply did not pay attention to the nine percent inflation factor or whether they are committing to hold to that two or three percent increase even with the nine percent inflation factor. If they could be held to that, that would be considered a relative strength and so we gave them a strength in that area. Figure seventeen, regional interconnection, the companies were asked to indicate how they would interconnect with other systems and what they are proposing essentially, is different technical techniques either through the use of microwave lengths or through the use of cable lengths. I think all the techniques listed are feasible, which one would be better would depend on which particular system you want to interconnect to, the distances involved and how many channels you are talking about. So, we felt that in that category all the applicants were considered just equally strong. Now, I think we get to the last item and this one might be worth spending a little time on because this is probably the i;-- that maybe may make a significant difference between companies in terms of what they have promised and that also is what you might call the category over and above the standard, system design, programming and features that you would get with any modern cable system. There were two sets of questions asked of the applicants. One was, what kind of corunitment they would be willing to make to public agencies and to the community and I will just go through these commitments very briefly to indicate the differences and see if you want to ask any questions. Americable proposed to interconnect the system to the County pperation Center and the Educational Telecommunications Center. Cablesystems proposed to provide five hundred thousand dollars over the fifteen year life of the franchising for a Miami Crime Watch. Miami Telecommunications proposed to provide three mobile communications centers, essentially, centers on mobile vans to the Police Department. Proposed to Provide computer assisted instructions software to the Fire Department for training, proposed to provide television transmitters for six emergency medical system units and to provide fifty remote video cameras for crime surveillance in areas or locations that the City might select. Vision, proposed to donate a hundred thousand dollars a year as a grant to the City each year of the franchise for the City to use to develop institutional services. Sixstar Nielson in this particular response to the form did not indicate any specific 18 JUL 71981 t min Commitments. Although, they state that they have commitments in other parts of their proposal. The next category... Mayor Ferre: No, no, question? Did you make any attempt to evaluate the commitments made in the strength portion and put a monetary value to it, for example, in the case of Vision we know that it's a hundred thousand dollars, because it's very simple. In the case of cable systems it is five hundred thousand dollars over fifteen years. In other word, this is what? Thirty-five or forty thousand? Or whatever it is a year. Actually, it's worth less than that because the value of money changes and so that has to be taken into account. Now, how much does Americable and Miami... what is the monetary value of that for the... in Miami's case for the three mobile communications command control for the Police, the computer instruction to software for the Fire Department, t.v. transmitters for CCMS and so on and fifty remote video cameras for crime surveillance. What is the value of that? Mr. Plummer: And the time frame? Mayor Ferre: And the time frame? And what is the value of Americables offer to interconnect to County Operation Center? Do they mean City Operation Center there? What do you mean County Operation Center? Mr. Pilnick: I think they are proposing to link the City cable system to the County Operation Center so they can extend it outside of the City's jurisdiction. Mayor Ferre: I see, ok. And the Educational Telecommunications? Mr. Pilnick: I think that's outside the City limits also. Mayor Ferre, in answer to your question, I have made some rough estimates on my own as to what I would place as an approximate value on some of these. Mayor Ferre: Do you care to share those with us? Mr. Pilnick: If you would ask me, yes. But I will say that many of them can vary considerably. If you take three mobile communications command control centers to the Police Department, depending on the extent of the equipment that you put in there, you could be talking about anything from twenty-five thousand dollars per man up to two hundred fifty thousand dollars per man, it can vary that widely. So, that in some areas, I think that you are left with a commitment that it will be hard to place an absolutely precise number of dollars on. The only thing that we have done in the evaluation so far.... I will be happy to give you my guesses on all these dollar values, but what we try to point out that some of these represent strengths. Now, we may have three companies listed as having strengths in this area and their dollar commitments can be different and you can then, if you want to, say that one... and your opinion is stronger than the other because it's offering more, but all we have done so far is list whether we can consider that in that category the company deserves being in the strong area or the weak area. I think when we come to the next page, Mayor, that you will find that there are probably a couple of dozen items in this category where a commitment is been made and no dollar value has been put on it. Now, you can use a dollar value, if you wish, as part of your selection process, but regardless of that, I think in the final franchise agreement there has to be a dollar value put on these. Mr. Plummer: Well, but you see the point is, we sitting here are lay people, not technical in the field have no way of judging at this point which is important and that which is not. Now,... Mr. Pilnick: I will be happy to put my guess as to a dollar value on all these items, if you wish, right now. Mr. Plummer: Well, I think, not only is it important from a dollar value, but this is a fifteen year contract and without any specified lineage saying we will do this by the year 1982, then, one has to believe in conversed thinking they could do all of this in their fourteenth year. Mr. Pilnick: That's not the kind of agreement that I'm recommending. The final franchise agreement should take every promise or commitment that they have made and make it first completely unambiguous so that both sides agree on what is being promised, that you put a schedule or deadline on each commitment, so that you have the triggering time to impose a penalty if they don't meet that deadline and it should have a range of penalties that are 19 JUL 7 1981 appropriate to the value of the commitment and 1 think that is a hteess ty regardless of which company you select. Mr. Plummer: Well, ok, you know, maybe what you are saying to me is than that should have been done before it came here for selection. Mr. Pilnick: I think it would be very difficult to do it without reopening the bidding process, because what happens... Mr. Plummer: No, no, I'm just... excuse me. What I'm saying is, is to put their feet to the fire and let Mr. Gary or you or whoever is going to do it say "Ok, how many dollars and by what time?" That's easy to do, that's not negotiation. That's asking for clarification. That's a big difference. Mr. Pilnick: Well, if you do it with more than one company at a time, I think it can be construed as possibly allowing companies who may have been felt to have a weaker proposal, the opportunity to make the proposal a little stronger by offering more than they really intended to offer the first time around. I think... my own feeling and my suggestion is that you select the company you think has the best offer and then, you clarify and if you don't select the company to grant the franchise to you, you select the company to negotiate with and the negotiation is contingent upon arriving at a satisfactory mutually agreement. Mr. Plummer: Mr. Pilnick, 1 understand what you are saying, sir. But what I'm trying to say to you is, that I think you are placing us in an aui,,ward position without knowing what is the best offer until we get a dollar figure and a time frame. You know,... Mr. Pilnick: I think if we go through the next couple of pages, which is the last item here, I think that you will find that some items are very substantial in dollar amounts and they are commitments with dollar placed to them. And I think those items maybe substantial enough so that they will allow you to compare among the applicants even if you are not sure what the value of some of the other items might be. We are talking about some items that are a lot of dollars and some items that are not so many dollars. Alright, the next category, the companies were asked to respond to the question as what provisions they would make to provide minority programming support and to involve minority communities in the cable communications effort and we have got, as you will see, we have got quite a list of items. Three of the companies in particular have offered a large variety. Some of them I think are important, some are not so important, but let me go through them very quickly and then I will be happy to try to clarify any of them that you have a question about. If we take Cablesystems, I am starting on page 114, they claim that they will provide an eight and a half million dollar fund over the life of the franchise for minority programming and training projects. Now, let me just stop here for a moment. One of the things you have to judge in all these applicants is whether they are repeating themselves a number of times and in some cases an applicant may say we are going to provide so many dollars over the life of the franchise and then you will find out that, that dollar value is broken down into a number of subitems later on. So, one of the decisions that have to be made is whether they are talking about the same dollars that they are talkiriy about in some other feature that they are proposing and I think we need some clarifications in those areas. But in any event, they will provide a eight and a half million dollar fund over the life of the franchise for minority programming and training projects. They will provide a minority television production training program. They will provide approximately a hundred fifty thousand dollars capital outlay per channel up to a cost of what they estimated as 1.8 million dollars to facilitate local minority channels. The question is, what does facilitate mean? 1.1 million dollar commitment over the life of the franchise to purchase a satellite up link. A satellite up link is a transmitter that can transmit television programs from Miami to other parts of the Country, rather than just receive them. They will provide the up link as part of the source of national minority programming. They will fund staff positions within their own community programming department for coordinators of Black, Spanish, Women programming. They will affiliated with the Pluck entertainment television network to provide local Black programming to the network. They will provide graphics, input terminals at numerous minority organization location. They will provide community production centers and several minority neighborhoods. They have studio locations in both the Latin and the Black neighborhoods. They will provide community origination points at numerous minority organizations so that programming can originate there. 20 JUL 71:081 f They will have members of minority groups in every advisory board. They will provide services in at least two languages. They will provide community viewing centers in every minority community, that is a community hall rather than individual residential viewing. They will hire minorities presumably in excess of equal opportunity and employment requirements. They will have the capability to send special programming to neighborhoods. They will carry the multi -cultural television channel of Toronto, which has multi-langual programming. They will provide Spanish language programming. They will include a women channel, include 3.6 million dollars over the life of the franchise for a project aimed at minority involvement. They will have a news production program originated at radio station WQBA. They will have a graphics input terminal at local minority newspapers. They will have a position on their staff focusing on minority business enterprises to try to insure minority business involvement and local programming. And they will have several staff positions for community programming and a commitment to involve local Black organizations in community programming efforts. And eleven channels dedicated exclusively to minority programming. I'm going to go through the other list very quickly, too. But I just want to point out in that list you have got them mixed in. You have got some others where dollars are mentioned and you can determine from that how many dollars over what length of time, for what purpose. You have got other items that are general enough so that it's very hard to put a dollar commitment on. If they say they will involve community organizations in programming, what does that mean?, how much is it worth?, and that's hard to uo Mr. Plummer: Well, let me ask this question. You see, where I'm having a problem if you go through this thing as I have. It says teledon input . terminals at numerous minority organizations. Mr. Pilnick, how many are numerous? Is that two or two hundred or two thousand? Mr. Pilnick: Go question. That word "numerous" was taken from their proposal. That's not my wording. Mr. Plummer: I understand. I understand, sir, but... Mr. Pilnick: But I'm saying that is one of many items, in many of the proposals that has to be clarified. Mr. Plummer: But you gave them a stength... Mr. Pilnick: Yes. Mr. Plummer: ... on that particular kind of wordage. Mr. Pilnick: Not because of that particular kind of wordage. I gave them a strcngth because there were enough things in there that were specific, like the, you know, the eight and a half million dollar fund. Eight and a half million dollars is specific. I suspect that if you negotiate with that particular company, we can say "list where the eight and a half million dollars is going to go to and have that justified and put a schedule and a penalty on all of that eight and a half milllion dollars. What I'm saying is, there is a mixed bag and it's not just true in this. It's true in the others too. But I think there was sufficiently, detailed, major items in the proposals of the ones that I gave strengths to, to justify the strengths. There was also a lot of ambiguous wording on many of the items that they did list. Mr. Plummer: You know, I read wording here that says--- and this is one of the items of one of the companies "Will produce programming of interest to minorities". On who's determination? Mr. Pilnick: Well, that's a very good question. I have been accused at some evaluations in the past in other cities of always stressing quantity over quality and I think what I mean by that is, I can evaluate something that's specific. I cannot evaluate something with language like the language that we just read. So, if I look at specifics and I think that there is enough specific commitments to hZ ahle to make those enforceable, I can rank that or I can evaluate it. It's very hard for me to evaluate wording like that. Mr. Plummer: Let me tell you the one that really tickled me, sir, because obviously, you don't know Miami that well. But one of the things here it says "A remote teledon input terminal at local minority newspapers". Sir, do - 21 JUL 7 1981 you know how many minority newspapers we have in the Latin community that start ors a weekly basis and end on a monthly basis? You could be talking about two hundred. It's amazing, every time I go down Southwest 8th Street, I see three or four new publications. So, I... you know, I... Mr. Pilnick: Obviously, I think anyone who rated this has conclude that a lot of the language is in there for the purpose of impressing various, different, decision makers in getting a franchise. And that is, I think, a general tendency of all cable companies applying for franchises. That kind of language has to be converted into something that's understandable or it has to be thrown out. You can't assume if it's not converted into something you can understand and enforce in a franchise agreement, you might as well say that you are not going to get that. Alright, let me just finish the other two, I think it will take about five or ten more minutes. Miami Telecommunications proposed the following; Will establish a vocational training program for the disadvantaged committing fifty thousand dollars annually for five years. Will provide Spanish public television with a hundred thousand dollars per year for administrative and programming cost. Will establish a cultural arts ethnic heritage fund to disburse grants totalling about 1.5 million dollars over the life of the franchise. Will provide fifty thousand dollars in scholarships to Miami area colleges. Will provide job and skills training at convenient locations throughout the City to maximize the involvement of minorities in program production. Will provide Florida Memorial College with both an FM radio and television acce-s production studio. Will provide specialized programming for specific audiences, dedicate channels to minority interest, insure the accessibility of production tools to minority areas of the City. Will produce programming of interest to minorities. Will incorporate a non-profit organization to determine the policies and handle the administration of the public access network. Will fund this with a hundred twenty-five thousand dollars for year one, a hundred seventy-five thousand for year two, two hundred thousand for year three and a seven percent increase each successive year. Will equip the Community Relations Auditorium and the Miami Dade Community College New World Center Campus. Will provide the regional access centers, community viewing centers and sites on the institutional network with full interactive capability. Alright, let me go to Vision. Vision proposes public access policies and procedures in accordance with the scripture they provided, fully staffed and equipped access studios located in minority communities. Separate local origination channels for Black, Latin and handicapped programming. Will offer Gallovision, Black Entertainment Television, Spanish International Network, Beta and the women channel. Will encourage public access corporation to aggressively pursue minority involvement. Will purchase minority community productions for the family movie channels. Plans to involve minorities in the advisory responsibility program development. Will carry channel 23, Spanish language channel on all service tiers. Will provide paid internships in cable television for all the residents of Miami, including minority groups. Will establish a career training center to provide cable operations experience. Will fund it with three hundred fifty thousand dollars initially and a hundred fifty thousand each year thereafter. Will provide narrow casting or neighborhood services on the subscriber network. Will provide twenty-one viewing centers in minority communities. And will meet unemployment practices exceeding State and Federal requirements. Now, we felt that those three companies, even though, as I indicated there is a mixed bag of proposals and some of them can't be^ally evaluated in terms of dollars with any certainty. We felt that all those three had sufficient hard dollar commitments that were understandable to warrant giving them a strength, as compared, again, to the other two applicants who did not propose this kind of dollar conunitment. Now, those are the areas, Commissioner Carollo, that I indicated where there were significant differences and where there were a large number of items, some of them or quantified, some of them had dollars on it. Some of them, your guess is as good as mine as to what they really mean or how many dollars there are. I think in a one to one negotiation the City can get these into much more specific form and make these ambiguous proposals really firm. But I would not suggest that you do that before you make your selection. I think you have to make your selection on the basis of how you view these offers and decide which one, at least the way you them, really means the most for the City and then after you have picked the best company, I think you can then negotiate to get everything that they committed in specifics. I think if you start negotiating with more than one you are basically opening the door for an auction. Mr. Carollo: So what you are saying is, that we are going to play the find the nut in the three cups and see which one we come up with? 22 JUL 7 1 81 0 Mid, Vilnick: No, I think that there were enough hard and clear items it home of these proposals to be able to make a choice, even though there is a lot there that is ambiguous. It's hard to define. Mr. Carollo: Well, from what we have gone over here though, there seems to be a lot of areas that are very ambiguous in all five companies. Some, of course, more than the others. If it's hard for you to place dollar figures on some of these proposals, imagine what it's like for us. Mr. Pilnick: I understand. You are going to hear from all the five applicants. They are, presumably going to make their best case. They will explain their proposal, at least, in what time they have available. They will be available for questions on some of these and I would be interested in their answers. Mayor Ferre: Alright, Mr. Pilnick, that leaves the next logical question which is, I assume you will be available, if not tonight, certainly if this is continued to answer some of the questions that probably are going to arise out of the presentations. Mr. Pilnick: Yes, sir, I will be here all night tonight and I will be available for whatever session you setup to follow this up. Mayor Ferre: Commissioner Carollo, are there any other questions you may have? Mr. Carollo: Yes. Are there any additional questions that you might want to ask of the five companies here tonight? Mr. Pilnick: There are areas in all the proposals that I would consider either weak or could stand amplification, but again, I think, my position is that these companies have had considerable amount of time, has spent a lot of money in preparing the proposals, are spending money now, as you can tell. I think they are all professionals in the business. I think if there are weaknesses in the proposals that I would not want to open it up to clarification or amplification of bids. I understand the proposals fairly well, I think. And if I'm wrong, the companies are always here to tell you that I'm wrong. Mr. Plummer: Well, let me tell you where I'm at and I can't speak for the rest of this Commission. Now, either you are going to do it and I would hope you would, because you are better qualified than I am. Somewhere along the line we have got to sit down, you have got to sit down with these companies, not negotiate, no. Not at all. Not negotiate, but say to this company "I want a number, numerous,. how many is numerous?, what's the dollar figure?, ok? And what year are you going to instigate it?" Let me tell you what I have learned in eleven years of politics. You got a five year contract, they do everything in the four and a half portion of the contract, because then, they are locked in for a renewal on the fifth year. I can envision here one company, company "A" getting this contract. They didn't do a damn thing for fourteen and a half years. Then on the fourteenth and a half year they implement everything and when you go to put it up for rebidding, they say "Oh, my God, look at all the millions of dollars we have got. We have got to have that contract again." Mr. Pilnick: That's been the practice in the cable industry up to very recently, Commissioner and what I would suggest, is you try to avoid that. And the best way to avoid that is to have a good contract going in. Mr. Plummer: Sir, either you are going to do it with the individual companies before we make this selection or I intend to sit here and we will go with each company and we will take the time of the Commission and all of the public that want to sit here and we are going to put some dollar figures on these things and we are going to put some time frames on these things, because other than that, sir, this wording is just much too, loose for me. I mean, you know, you are telling me that they are going to get up here and they are going to make their best presentation. Well, I will tell you from what you are saying the, use an awful big shovel in making these bids and I'm sure that their presentation is going to be a steam shovel. Now, I need some dollar figures or I don't think that I can sit Lere and legitimately determine which company I think is better than t-he otliers. 1 just don't see how I can do it. Mr. F.ilnick: I uliderstar,d, coiiwiissioner l�luiiuner, but the one thing I would again, repeat at the risk of being boring, I think, if you do that with all the companies simultaneously, whether you intend that or not, you will be 23 JUL 71981 te6pening the bidding. You will because every company will be when they clarify and when they put a dollar amount on it, they will be putting a bigger dollar amount on it now than they would have put if they had to make that estimate before the bidding process started. Mr. Plummer: Well, is that such a bad thing? Mr. Pilnick: That's up to you and your City Attorney to decide, sir. Mr. Plummer: No, what I'm saying is, if they are all going to put bigger dollars and they've all five got the same opportunity, maybe the City is better off. Mr. Pilnick: But you conducted a request for proposal under rule that you setup and if it happens that the company, any company that might be the worst on the first go around, winds up best on the second go around, I think you are asking for trouble. Mr. Plummer: What about if all five companies agree to it? Mr. Pilnick: That's up to you, sir. Mr. Plummer: Well, you know, hey, if they didn't put any answer in at all they can't put a number on no answer at all. Mr. Pilnick: That's correct. Rev. Gibson: Therefore, we again, are placed in the position, I keep saying this —we therefore are placed in the position to put a value judgement based on what Theodore Gibson thinks. And I want to say this for the benefit of the public, since you elected me to use my judgement, then my judgement has to be what you consider pretty good judgement. I just want to make sure that you all hear me loud and clear, because if I read all of this business you gave me and if I from the companies and from your personal visitation, I am no better off now than I was before in that I must use my judgement. I want to make sure all of my friends hear me. It will be a value judgement and there isn't a single person up here has a QED. You understand what I mean by that? Then, that means three of us must place a value judgement. Whether the three of us agree is not the issue. Whether the three of you agree is not the issue. The majority agreed that any of our value judgement, this is what is. Isn't that what you are telling me? Mr. Pilnick: I'm telling you that I will provide any help that you ask for and any help... Rev. Gibson: No, no, no, you are evading and I understand. I have to do that as a Priest ever so often when there is man and wife squabble. I understand that. But you have to admit that I'm on dead center that when it is all over, since in many instances you didn't put a price tag and they didn't put a price tag, I have to use my discretion. That's what you said earlier. You said that as far as you were concerned —note what you said "In my judgement as your consultant, I brought you five names and each of the five is capable of producing." Note how you got out of it, doggone simple and easy. Ar,u` I could understand. That's the way I preach also, ok? That's the way I counsel my... the two people or the members of the family. And I don't want the public to forget that, because let me tell you what's before us. You are not saying this. Man, millions of dollars out there in this City and this means work, sweat and tears. And I understand that, because I preach knowing that if I don't get no money in alms basin 1 can't pay Florioa Power ana Light nor Southern Bell. I understand that. Now,... So, I hope J. L. and Mr. Mayor and Mr. Carollo, all of you all understand so that later on no nobody says "Well, you know, they sure didn't make the best judgement". You live with that too, don't you? Right, as a value judgement and I'm going to make. Now,... so,... and I must of all of the people here make that clear, because I know half of my... no, a portion of my constituents are going to say "U-y, Gilson, what happened?" Arid I'm going to say "Well, you know, I had to make a value judgement." Ps.d then, of course, they will say "Well, you don't have very good judgement." And I'm going to say "Well, that's questionable." Isn't that the way you do it? Sir? Oh, yes, oh, yes, that's the way you do it. Ok, I just want to make sure we understand. 24 JUL 7 �To 0 N Mayor Perre: Alright, Mr. Carollo, any further questions? Mr. Carollo: Not at this point and time. Mayor Ferre: Alright, Mr. Plummer? Mr. Plummer: Mr. Mayor, I have probably an hour's worth of questioning of Mr. Pilnick. I think it's only fair that where it was advertised that the public hearing would be at 4:00 P.M. and we are already an hour or forty-five minutes over that, we should either go ahead with the public hearing or the presentations. My questions are not going to go away. I think some of them are in fact going to require answers that he can come back with on the 14th or whatever date is set by this Commission.The most important has already been asked, but no determination has been made as to how we are going to set dollar figures and time frames to these things, if that is the will of the Commission. So, Mr. Mayor, I am more than willing, as a matter of fact, would prefer to let's go ahead and have the public hearing and have the presentations which might add or delete to my questions. Mayor Ferre: Father Gibson, any questions at this time? Rev. Gibson: No, sir, I carried mine on right along. Mayor Ferre: Alright, now,... and I will like Plummer, reserve whatever further questions I have until after the presentations. So, unless you have anything else to add, Mr. Pilnick, at this time... (COMMENT INAUDIBLE) Mayor Ferre: Alright, Dr. Willie Robinson, we will start with you, sir. Each one of you will have three minutes. I counted ten people who wanted to be heard and as you... if you would please come up and give the Clerk your name, I will call you in the order that you... Alright, Dr. Robinson, we are always happy to have you in our chamber, sir. For the record, would each one of the ten members of the public that are speaking here today start off by giving your name, your title, if any, who you represent and your address. Mr. Willie Robinson: Mr. Mayor, Mr. Vice-:layor and Commissioners, my name is Willie Robinson. I am President of Florida Memorial College located in the Northern part of the County. A specific address is 15800 Northwest 42nd Avenue. I am pleased to have the opportunity to say a few words on an opportunity that has come to Florida Memorial College which represents a new area. A new employment area for us. For the record I would like for everyone present to know that we are a predominantly Black Institution with almost one hundred two years of history. Although, we have been in Miami only since 1966. This opportunity came to us because we are struggling for some recognition, struggling for some respect and I would have you know, Mr. Mayor, and the Commissioners, that Telecommunications came to us. We did not seek them out. We are as I indicated earlier a predominantly Black Institution serving low income persons of our society. I would have you understand too, Mr. Mayor, with the advances in technology, that the society is making Black people specifically and more generally speaking, minority people have been left out of the ground floor of opportunity like cable television. An example of what I have just said is the telephone company years ago and I can go on, but the point is the company that came to us, came with respect and recognizing that we have a peculiar contribution to make to this region. In an industry that is coming into fruition there is going to be a need for trained intelligence, there is going to be a need for having the minority community be considered a place of their own and Florida Memorial College is such an institution. Now, we do not claim, Mr. Mayor and the Commissioners, to be experts in this area, but we do say if we get an opportunity to move into this new area we will find the expertise to make sure that this community is served in a manner in which it should be as it relates to Black people and other minority. Specifically, if we were to make some assumptions, there are some peculiarities about child rearing practice as it relates to Black people in this land and it would be our hope to provide some opportunities where the minority community could and would benefit from this opportunity. Crime is another area of concern to all of us who reside ir, Dade County. I don't need to say that in many instances the Black or minority point of view is overlooked in the dominant media and obviously, if we get the opportunity to provide new servic to this region we would make doubly sure that an objective, important contribution 25 JUL 71981 0 lie made in this area as it relates to the news media. Lastly, Mr. Mayor and the Commissioner, I would say to you once again, that Black Politics throughout this land have made a tremendous contribution to this society and we would like very much to have an opportunity to break new grounds in an area that has not been afforded us before. In closing I would like to ask your favorable consideration to Miami Telecommunications request for the license. Thank you, very much. Mayor Ferre: Thank you, Dr. Robinson. The next speaker is Mr. Richard Hunt, Chairman of the Citizens Crime Commission. Mr. Hunt? Mr. Richard Hunt: Thank you, Mr. Mayor and members of the Commission, I will read my statement. It will be brief. I'm here as Chairman of the Board of Directors for Citizens Crime Commission of Greater Miami. The Citizens Crime Commission of Greater Miami wishes to express a strong endorsement of the Crime Prevention proposals contained in the cable television franchise application of Cablesystems Miami, Inc. Our Executive Committee have studied in some detail the proposed dedication of two channels to community crime prevention activities and we feel that the mentioned applicant and it's consultant, Rocky Pomerance answer to be congratulated for coming up with a program which we feel should be integrated in all cable system which operate around Dade County. In the short time we have had so far to examine the potential of cable television as a weapon to help control criminal activity in the community and improve the functioning of the criminal justice system, we have already identified several specific uses which we feel would have a drastic and immediate impact in Miami. An obvious application, for example, would involve communications from public prosecutors to persons under subpoena for appearance in criminal trial. Our Grand Jury has established that the communication breakdowns in this area along is adversely impacted on a conviction range and is responsible for development of a bias on the part of our citizens for avoiding involvement with the criminal justice system as a witness. As another example, we refer to the Citizens Crime Commission's new crime stoppers program which is scheduled to become operational here in August. Since under this program informants work with a guarantee of anonymity we are forced to communicate with them only when they choose to call us. And this one way communication is a limiting feature in the programs effected. Channels dedicated to community... anti -crime communications could become mediums for critical communications between the police and persons having information which would lead to conviction and successful prosecution for the commission of crimes in this community. At this point we simply can't see the limits to the potential in which cable television channels dedicated solely to stopping crime and improving the functioning of the criminal justice system might have on improving the quality of our life here in Miami. Now, this is not intended, though it might sound, to be an endorsement of Cablesystems of Miami by the Crime Commission or as a recommendation to the City Commission that that applicant be awarded the cable television franchise for the City. However, we do commend the applicant for it's innovative proposals relating to crime prevention and we consider those proposals most worthy of your endorsement. Accordingly, regardless of which applicant may ultimately be granted the franchise for Miami, the Citizens Crime Commission urges the Miami City Commission to incorporate the crime prevention proposals of Cablesystems Miami, Inc. as one of the City's objectives in negotiating the public service commitment of the successful applicant. We would request that our Executive Director, Howard Rasmussen, be notified of those negotiations and that the Crime rnmmiGsinn be given an opportunity to consult with the Manager on questions of the public interest as related to crime and the criminal justice system in connection... (COMMENT INAUDIBLE). Mayor Ferre: Thank you, Mr. Hunt. The next speaker is Jay Ogden of the Dade Business Women. Mr. Ogden? Mr. Jay Ogden: I represent the Dade Business and Professional Women. I didn't have a prepared speak because what I have got to say I think we all will understand and I understand. Three minutes to go, we have and I'm going to make it short. In the first place, I think Father Gibson said it well, the majority rules in America. Not always. The majority in America are women, believe it or not, and they are being ignored in many cases and in this case particularly. There is nrl­ r-ne system that has offered a women's channel. They are the largest ndiiurity group in this Country. They work,they make the kids, they go out do the jobs that a lot of men don't like to do and get paid less money than the men got paid for. They are there, they back you up, you have got wives, you have got daughters. They need a program. They need a channel that they 26 JUL 7 1981 4 can get their message across and only one system has given it to them. Cablesytems is endorsed by the Dade Business and Professional Women for that reason. I think that I know most of you and you all have wives and you want women to get a fair break and I think it's right. However, if you don't agree with that, t think you might well think about insisting that a women's cable be installed in any contract given to any company. Thank you. Mayor Ferre: Alright, the next speaker is Mr. Wally Lord. Mr. Lord? Mr. Wally Lord: Good evening, I represent Fusion Dance Company. Now, after some comparison of the cable contracts that are being sought with the City of Miami, I became aware that Cablesystems is basically, in my opinion and in the opinion of many of my colleagues in the arts community, is going to be more effective in helping the arts institutions in Miami and I would like to pass out, if I could, just some support data for that and I will be very brief. I know you have got a lot of... a long evening ahead. Basically, I feel that they have given a lot more thought to servicing the community at large and they are prepared to put a lot more money into budgets for locally produced programs. Now, locally produced programs means that perhaps Fusion Dance Company can actually produce programs and have them televised and not like we did this year with Channel 2. Also, there are many other arts organizations which can use pilot projects and things of this nature. That means locally produced programs and also, I would like to draw you attention to the number of hours per week of locally produced programming. Now, that is just locally produced, that doesn't mean even things that they would bring in from the outside and be responsible for putting on the air here. But Cablesystems clearly out distances the other in the number of hours per week that they are going to produce programming and I think you can see that in year ten alone, that their operating budget is much greater than the rest. Also, they are going to put up a quarter of a million a year for cultural productions and direct grants, seventy-five thousand dollars as I understand is direct grants to institutions. Also, I think as we... as I listened to the discussion this afternoon there was basic question on which companies can produce what they say they are going to produce. They can all claim a lot of things, but who can really do it and what's their track record? I think if you will look at Cablesystems, from what I have been able to get, that they have a ten year record of good local. art programming and thirgs like that. So, it looks to me as if Cablesystems is the strongest and for that reason I have stuck my neck out in a political scene to say that the... that I believe they will do the most for the arts and therefore, they are going to give the most to the City of Miami. If you would indulge me another minute, David Black, who you requested to speak and who is President of the CDC had to leave and asked me to read his statement which is very short. I think I can do it in less than a minute. This is David Black's statement; "I am *Managing Director of the Players' State Theatre. I have been involved in non-profit theatre all my cultural professional life. I speak for myself and as President of the CEC, Cultural Executives Council of Dade County. I speak for my colleagues when I say that the inclusion of an art channel is a prerequisite for any company being awarded the cable communications license for Miami. I would not presume to say that my support of Cablesystems of Miami is shared by all my CEC colleagues, but I do know that Cablesystems is the only applicant who has clearly designated a local origination arts channel in their application. They are the only company that has contacted me personally for my input and consistently stayed in touch for my continued input. For that reason I have agreed to serve on their Advisory Committee to help guide the proposed arts channel. I have always felt that with some imagination and freedom to experiment the proforming and visual arts and the sciences could be creatively and meaningfully transferred to the television medium for the ultimate pleasure of the viewing public. Cablesystems is the only company that has expressed the intention to make that a viable capability. Their track record for local arts programming is unmatched by any other applicant and television is a medium devoted to information and education, certainly, but primarily it's a medium of artistic expression. Any cable system that does not address itself to this service in the community is not fulfilling it's responsibility. I think it is significant that Cablesystems has recognized that responsibility from the beginning. G. David Black, Managing Director, Player State Theatre." Mayor Ferre: Alright, thank you, Mr. Lord. Mr. Lord: Howard Dando, also will send you a written statement* he is basically in agreement with these and he had to leave also. Thank you, Mr. Mayor. 27 1981 JUL 7 Mayor Ferre: Who is that for the record? Mr. Lord: Howard Dando, who is the Executive Director now of the New World Festival of the Arts. Mayor Ferre: Alright, sir, thank you. The next speaker? Is Mr. Leonard Batz..., Mr. Leonard Batz: Mr. Mayor and Commissioners, I'm Leonard Batz, President of the Board of Directors of Senior Centers of Dade Incorporated. As you know I have been involved with the Florida legislature for some three years. My concern obviously, is for the elderly. In as far as the television programs are concerned, certainly, they are necessary and particularly among the elderly who maybe you don't realize it, but their in a sense, in jail in their own apartments from 4:30 in the afternoon until 8:30 the next morning when Senior Centers opens up their eight centers. We have six thousand elderly, forty-two hundred who live in housing. We provide thirteen, as high as fifteen hundred meals a day five days a week, but my concern is this, out of the five groups of television people who are here today I listened to their presentation and the summarization it only one and that was Cablesystems of Miami had the good fortune and good thinking to come to Senior Centers and discuss with us what do you need. We have eight centers and certainly during the hours that the persons has to be confined until we open the next day we can help them provide programs for them, so we can bring the elderly back together again, because after all they provide the economic stability for Miami and Dade County. Thank you, for the privilege Mayor Ferre: Thank you, Mr. Batz. Mr. Eddie Blanco, name and address and who you represent. Mr. Eddie Blanco: Eddie Blanco, 10121 Southwest 102nd Avenue. Mr. Mayor and Miami Commissioners, I am appearing in front of the Commission to speak about the Cable T.V. As a communication professional with many years of experience in television with Spanish speaking audience I am very excited with the many great possibilities that Puerto Rican super -station will have for Miami. Mayor Ferre: What's Puerto Rican super -station? Mr. Blanco: It's a project, a cable system they have made an offering intent of spanish programming that will greatly arise the choice Hispanic will have with the Puerto Rican super -station. Miami will become the focus of much Spanish programming for the whole Hispanic community. In this County which is destined to become the largest minority in the United States in the 1980's. I believe that Miami demands great improvement in the Spanish super station. Miami will become the focus of the Spanish programming in cable communications just like Atlanta has become associated with Ted Turner and super stations of the WQBS. Cablesystems is a company that has committed itself to this great challange and because Cablesystems is a cable company with technological know how, financial capability and the most expense, a multi -cultural of the Hispanic community of Miami will be the ones to benefit from this super station. I therefor offer you to grant he Cablesystems licensing for the City of Miami. Mayor Ferre: Thank you. Patricia Ireland? Ms. Ireland. Ms. Patricia Ireland: Yes, I'm Patricia Ireland and I am here to speak to you on behalf of the Media and Women. Mayor Ferre: Address, Ms. Ireland? Ms. Ireland: I'm sorry. I work at 1 Biscayne Tower, Downtown Miami. I am here on behalf of Media and Women, which is a coalition and association of many women groups who are very excited about the possibiliteis of cable television in Miami. Many of the groups who know groups like the Florida Association for Women Lawyers, the National Organization for Women, Women Committee of one hundred which is comprised of a multitude of other organizations, AAkB and alike. We are very excited about the possibilities because we know there are many subjects of interest to the women in our community that do not receive attention on the current stations. Women's legal status, for instance, women in crime, women's health, women's art, music and cultural. We were as many ..f t`.c: other speakers, were contacted by Cablesystems, but we wanted to present a proposal to all of the applicants and we did draft an extensive proposal for women's programming in a women's channels. We presented it to all of the applicants, but only Cablesystems was willing to make a commitment to a twenty-four hour local origination station. They have also made a commitment for the financial support necessary to develop excellence in our 28 JUL 7 -�1 women's programming. I want to be very brief, but to tell you that many, Many women in this community are interested in the presentation of women's programming and that we need a cable company like Cablesystems that's sensitive to the needs of all of the segments of our multiethnic, multiracial community and it does not ignore the Hispanic women, the Black women, the Anglo women in our community and their needs. For this reason we have a great interest in seeing an applicant selected which will provide a local origination women's channel like Cablesystems has proposed. Thank you. Mayor Ferre: Alright, the next speaker will be Dr. Berta Arteaga Morgan. Dr, Morgan. Is Dr. Gusto Regalado here? Dr. Regalado? UNIDENTIFIED SPEAKER: (SPEAKS IN SPANISH). Mayor Ferre: (SPEAKS IN SPANISH). Ok. Mr. Morgan: (SPEAKS IN SPANISH). Mayor Ferre: I assume you are Maria Elena, are you? Would you step up and on behalf of Dr. Regalado, you want to make your statement quickly into the microphone. Ms. Maria Elena: Well, they are just endorsing Cablesystems of Miami the Useful Aged. Mayor Ferre: Alright, thank you, very much. And your name for the record please? Ms. Maria Elena: Maria Llanza. Mayor Ferre: Alright, thank you and your address, Ms. Llanza, we need it for the record? Ms. Llanza: 3135 Southwest 98th Court. Mayor Ferre: Alright, thank you, very much. Ms. Llanza: Thank you, very much. Mayor Ferre: Now, Dr. Morgan. Dr. Yvette Arteaga Morgan: My name is Yvette Arteaga Morgan, my project is a Dade County Public Schools. So, I will give you my address of 150 Northeast 19th Street. Honorable Mayor and Commissioners, this letter is to inform you of our great interest in having Cablesystems Miami awarded the cable license. Our reasons for this decision are as follows; One, the involvement of Cablesystems Miami in our community has not only been consistent, it has been effective as well. Cablesystems Miami has committed 3.7 million dollars for the Miami Together Project. The only purpose and objective of the mentioned project is to help alleviate community divisiveness, racial, and ethnic tensions. The keen sensitivity of Cablesystems Miami to see and feel the need for special programs is evident by their taking, setting aside 2.7 million dollars for such programming as documentaries, special art9, minority interests,, -and very, very good women issues. See the sensitive awareness of Cablesystems Miami toward their multicultural / multilingual community has led them to earmark a bilingual center as a priority to be organized and staffed. The main goal and purpose of this center will be arranging programming from Spanish to English and vice versa. All materials and programs which will need to be arranged or translated will be originated at this bilingual center. Project BASE, Bilingual Alternative for Secondary Education is a project from the Dade Public Schools. It is a multifacet program and many of the audio visual media are much involved, such as video tapes, slides presentations, audio cassettes, filmstrips. Cablesystems Miami has been the only company that has offered technical assistant to our project BASE. We as project BASE will give Cablesystems Miami its full cooperation and support. And we hope you feel as we do. Maycr Ferre: Alright, thank you. Mr. Plummer: Doctor who were you speaking behalf? Dr. Morgan: This is my project, project BASE. 29 JUL 71981 it H Mayor Ferre: But what is project BASE? Who is project BASE? Dr. Morgan: Project BASE is Bilingual Alternative for Secondary Education. It's a guidance program Title IV. Mr. Plummer: And that program is in operation? Dr. Morgan: Yes. Mayor Ferre: What part of the Dade County School System? Dr. Morgan: It's part of the Dade County Public School System. It's a guidance program. Mayor Ferre: Alright, the next speaker is Alberto Gonzalez. Your address? Mr. Alberto Gonzalez: (SPEAKS IN SPANISH). Mayor Ferre: Maria, why don't you come on over here and that way you don't have to be taking turns on the microphone, ok? So,... Ms. Llanza: I will be serving as his interpreter since he doesn't know any English. Mayor Ferre: (SPEAKS IN SPANISH). Mr. Gonzalez: (SPEAKS IN SPANISH). Ms. Llanza: Alberto Gonzalez represents a group of Cuban exile artists. As a writer of La Silla Caliente radio show he is in touch with the Cuban community. He feels that by giving Cablesystems Miami the license you will open the doors for all Cuban artist to produce shows live and to explore the talent of the artist of Miami. He feels that the Cuban community right now doesn't have a channel where to express local arts and feelings because the other channels are only bringing in shows from outside of the Country, but with this Cablesystems channel there will be an opportunity for the local community to do shows live and it will be a great enhancement for the Hispanic community. That's all, thank you, very much. Mayor Ferre: Thank you, very much. The next speaker is Lurdes Dicrisci. Ms. Lurdes Dicrisci: Mayor Ferre and Commissioners, I would like to talk in public very much. I get very nervous ... (COMMENT INAUDIBLE). Mayor Ferre: Speak up a little bit. We need your name and address please. Ms. Dicrisci: Ok, my name is Lurdes Dicrisci, 2171 Southwest 16th Street. I was saying that I don't like to talk in public. I get very nervous, but this is a very good cause and I believe that Cablesystems will provide Hispanic community with all of the propaganda that I need in my program. I work for the New Latin National Educational Service Center and I work with Hispanic senior high school students. Ok, through the propaganda that we may get through Cablesystems I believe that I will be able to reach those students who don't know anything about our program and this has been the only system who has -mime to us to offer the help that we need in our program. So, I am speaking for them. Thank you. Mayor Ferre: Alright, that concludes all the people that gave papers to the Clerk and I think as I recall there were eleven or twelve that have spoken. Is there anybody else from the public who wishes to speak at this particular time. If not, to go by the rules and do this perfectly legal I think we need to have a motion to close off the public participation at this point, reserving the right if we have and at the second meeting I will open it up again at that time. Is there such a motion? It's been moved and seconded, is there further discussion? Call the roll, please. THEREUPON THE FOREGOING MOTION to close the public hearing was introduced by C:uwad5sioner Lacasa and seconded by Commissioner Carollo and passed by a unanimous vote. 30 JUL 71981 4 V Mayor Ferre: Alright, now, we have the first presentation that will be made by the applicants. The first one is Miami Telecommunications. Is the representative of Miami Telecommunications ready? Is Miami Telecommunications... if not, then, we will go on to the next one. Is the answer "yes"? Is Miami Telecommunications ready to make it's presentation? Ok. Alright, we will take a five minute break while you all get ready to setup your presentation. NOTE: AT THIS TIME THE COMMISSION TOOK A FIVE MlINUTE BREAK. Mayor Ferre: Alright, Father, we need to have you sit down because we need to turn all the lights on because they have to focus. Ok, now, lights. Now, focus. (COMMENTS OFF THE PUBLIC RECORD). Alright, are we ready to begin now? Alright, Mr. Clerk, if you will turn the thirty minute button on or whatever it is. We don't need lights do we? Or do we? Yes, alright, proceed. Mr. Dick Gerstein: Mayor Ferre and members of the Commission, good afternoon, I'm Dick Gerstein, President of Miami Telecommunications and I want to welcome you to world war III. We recognize that the selection of a cable television company to serve Miami is possibly one of the most important decisions that this Commission will ever make. It is a decision that will effect the citizens of Miami for at leat fifteen years. We are pleased to be here today to tell you why we feel our proposal will best respond to the needs of the citizens of Miami both today and tomorrow. Miami Telecommunications is a Florida corporation based in Miami and represents a broad cross-section of the Miami community combined with final,cial strength and experience, Telecommunications Incorporated and Taft Broadcasting Incorporated, we are a triethnic group, Blacks, Latins and Anglos. We represent over four hundred thirty-three years of residents and involvement in this community. Your consultants report found more strengths and fewer weaknesses in our proposal than that of any other applicant. Other applicants will therefore, attempt to discredit us and the consultants report. This is to be expected. Seventeen local investors in Dliami Telecommunications are and have been for many years concerned and active members of the Miami community. We felt that if we were going to get involved in cable television it was imperative that we have a meaningful voice in the management of the system. We selected TCI as our partner. Miami Telecommunications is twenty-five percent owned by local investors. There are no buy out agreements. Local control is assured since all corporate decisions require approval by a vote of eighty-five percent of the outstanding stock. That's... We Miamians will not allow any changes or decisions to be made that are not in the best interest of the triethnic City of Miami. We will be an autonomous company with decisions made locally. Another plus is that our proposal was written and produced in this City. It was not shipped in from New York or some other distant place. We were very much involved in this preparation from beginning to end. We made sure the programming, employment practices, community benefits and special services were what Miami needs and desires. Local involvement will be on going. If you have requests or comments concerning this cable system you will be able to come to me or to any of us here in Miami and know that you will be heard and your request acted upon. And you know us and you know what we have done in this City and in this community. And now it's my privilege and pleasure to introduce to you Mr. Charles Meecham, who is the Chairman of the Board of Taft Broadcasting and Mr. Bob Magnus, Chairman of the Board of Telecommunications Incorporated, who are our partners in this venture. Thank you. Mr. Charles Meecham: Thank you, very much, Mayor Ferre and Honorable members of the Commission. My name is Charles Meecham and I'm Chairman of the Board of Taft Broadcasting Company. We are a company formed more than forty years ago and we are involved in three primary areas of business, commercial radio and television broadcasting, regional themed amusement parks and television and motion picture production and distribution. We have really though, one primary goal, to inform and entertain large audiences around the world. We currently operate seven television stations, twelve r adio stations and five themed amusement parks. In addition, our entertainment group includes Hanna -Berra Productions, the originators of such well-known cartoon characters as the Flintstones and Yogi Bear and we have a program library of over three thousand episodes. Our production operations also include Quinn Martin productions, the creators of Barneby Jones and many other hit shows. And our world vision subsidiary distributes television programming such as Dallas, Love Boat, Little House on the Prairie, All Around the World. These are only a few of the many shows that, that company distributes. We are not only involved in a broad range of information and entertainment services, but 31 JUL 7 1981 V V we also feel we are financially stable. As of the end of our most re­r.:t fiscal year our assets stood at five hundred seventy-nine million and our common stockholders equity at two hundred forty million. Assuming the maintenance of the fifty percent debt to capitalization ratio in March 31, 1981 we had debt capacity in excess of a hundred million dollars. In a normal year our operations produced working capital of over forty-five million and our net revenues now approach a quarter of a million dollars each year. In short, we are at large diverse and financially secure enterprise. To give you some idea of the kind of undertaking that we believe we are capable of creating and executing, our most recent project, Canada's Wonderland, a major theme amusement park near Toronto was opened just this past Spring. The planning of this project took more than seven years, required a construction period of approximately two years with a final cost in excess of a hundred five million dollars. So, we think that we are capable of planning and executing complex and sizable projects such as the one that you are deliberating. We're now entering the cable television business in a partnership with Telecommunications Incorporated. Cable television logically follows our goal of supplying the best available information entertainment services close to home at a modest price. As apart of the TCl/ Taft joint venture, we are very pleased to be apart of the Miami franchise application. We think that Taft brings in added dimension to this cable project because we are experienced in program production, financing and scheduling. And as I have already mentioned, we have a large library of product upon which we can draw in serving this area. We produce many forms of family oriented programs and we are prehaps the best known for the production of high quality, broad appealed young people's progra..-ring. We would expect to apply that expertise to the Miami cable operation. We are fully committed to utilizing the company's creative and financial resources in developing this project. Obviously, we wouldn't make such a commitment if we didn't believe in the future of Miami and we are anxious to provide a valuable and meanful service to this community. We think that the joint venture of TCI and Taft is a strong experienced one with a unique expertise in system construction and quality programming. On behalf of the two parent companies of this joint venture, I would like to assure you of our total commitment to this project. Thank you and it's my pleasure to introduce Mr. Magnus, the Chairman of Telecommunications. Mr. Bob Magnus: Honorable Mayor and Commissioners, I'm Bob Magnus, Chairman of the Board of Telecommunications Inc. or TCI. I'm here today on behalf of TCI to reaffirm our commitment to Miami Telecommunications. TCI is a public company independently known. It serves almost a million and a half basic cable subcribers. We have numerous construction projects on the way at this time. However, there are principally in areas where we have position operations adequately staffed and competent personnel and they are perfectly capable of seeing their projects through. We were fortunate this year to get off two public offering and yielding about a hundred twenty-five million dollars in new equity money into the company. We still have an excess of fifty million of this in immediate or semi -immediate funds. We just very recently made an arrangement with our existing bank group to provide us with an additional hundred thirty million dollars. I think with no major construction programs on the drawing board and with adequate funding TCI is in the position to lend its full support to the funding and design and construction and basic operation of this project. Thank you. Mr. Al Cardenas: Good afternoon, Mr. Mayor, Honorable members of the City Commission, my name is Al Ca._,nas, I'm the Treasurer of Miami Telecommunications and a resident and voter of the City of Miami. The benefits of our proposal expanded to services and technology is what our proposed rate structure brings a wide variety of programs and options to the community at a very low cost. In fact, as low or lower than any of the other applicants. Maximum availability of cable television to the public is guaranteed by our system on any one of the twenty-one free community channels. We provide any special services for the Black and Hispanic communities as well as public access programming which, by the way, will be governed by the Miami Public Access Council, ad entity independent from us. In addition, we propose state of the art service, such as opinion polling to find out what citizens in your community feel about relevant issues. Teletex data retrieval, public access computer centers, the most advanced Police and Fire security systems and I mention, the only system of rill by any applicant which will meet UL Security Service requirements in all respect to keep false alarms from increasing the burden on Police. Our two hundred nineteen mile institutional network is the longest proposed by any applicant and we will be on a separate cable, not shared with a subscriber network, so that both members, subscriber network and institutional network can maximum flexibility. All institutions will have access to studio facilities. 32 J U L 7 1 81 V C No applicant, no applicant has offered a system more technologically advanced than ours and most have offered less. At your last meeting the question was asked, what is the value of the contributions contained in the various proposals? You want to qualify what we each were willing to give. Your cable consultant recognized our advantages when he gave us the most strengths of any proposal in responding to the needs of Miami. Our system will assist Miami's triethnic community in obtaining full benefits from cable. Let me give you some hard dollar facts, for support of the arts over two million two hundred thousand dollars, to the Black community directing over a million seven hundred thousand dollars, for Hispanic assistance over two million dollars, for minority scholarships and training over three hundred thousand dollars, the community at large over seven hundred thousand dollars and over thirteen million dollars for our triethnic staff assistant over the term of the license. And these are only some of the benefits we propose. We are making certain that the promises we have made to the citizens of Miami. are promises we can keep. We the local partners have a long term commitment to this community will make certain that these commitments are kept. Thank you. Ms. Georgia Jones Ayers: Mr. Mayor and members of the City Commission, I am Georgia Jones Ayers, a member of TCI of Miami. Some people describe me as a community activist, others as a street person, but you know I believe in this City. Yes, I am apart of Miami Telecommunications, but if I did not believe that our group fully intends to help minorities, I would not be apart of this group. We are committed to an aggressive improvement and printing program for minorities, Black, Latin and women. We will have a triethnic work force of at least one thii•3 Black and fifty-nine percent Hispanic at all levels. Not just every level entry position. We will maintain a work force that represents this community. We comitted two hundred fifty thousand dollars to vocational training and minorities and fifty thousand dollars to a scholarship fund for minorities who want a career in radio and television. Out of 4.3 million dollars that we have committed to public access, 1.5 million is specifically for the Black community. Several years ago TCI was the only company willing to fund Black entertainment television with hard dollars. BET is now a nationwide Black source, a program source. We are committing major resources to assist Florida Memorial College and Spanish public television. We will provide studio equipment and training in both Black and Latin communities. Minority business enterprise will be substantially utilized by our firm. We commit ourselves to retain Black companies to develop and implement a marketing plan for sales in their geographic areas such as Liberty City and Coconut Grove. We will contract with firms to work on the construction aspects of installing cable. Additionally, a training and employee service contract will be negotiated with a Black company or organization. These plus other business opportunities such as the security services are committed to the Black business commpany. Our difference is, that we will deliver and I will make certain that we do. Please refer to the back of your brochures for exact details of our benefits to the Black, Hispanic, cultural and other sections of our community. Thank you, very much. Mr. Gerstein: Thank you. Members of the Commission, there will now be a brief audio visual presentation for your information and we thank you, again, for your attention. (AT THIS TIME THERE WAS A AUDIO VISUAL PRESENTATION). Mayor Ferre: Alright, thank you, very much. The next presentation will be the Americable of Greater Miami. Mr. Clerk, how much time actually... Mr. Ongie: Thirty-five minutes. Mayor Ferre: Thirty-five minutes. Now, we will permit the others if they so wish to take an additional five minutes and Mr. Gerstein, now, you, of course, will have another half hour and of which time we will give you five minutes for rebuttal and at that time you can make whatever statements you wish... further statements. Alright, the next presentation will be Americable of Greater Miami. Is the representative of Americable here? UNIDENTIFIED SPEAKER: Right here, Mr. Mayor. Mayor Ferre: Are you ready to begin or would you rather wait until all this e:,iirment is shut off and... is this your stuff here? UNIDENTIFIED SPEAKER: We would rather have five minutes, Mr. Mayor. Mayor Ferre: Look, we are going to take a five minute break, but I would like 33 198 JUL 7 1 5 j1 to ask each and everyone of you to really be here in five minutes, ok? So, we will get started at ten minutes after six. NOTE: AT THIS TIME THE COY24ISSION TOOK A FIVE MINUTE BREAK. Mayor Ferre: We will now begin the presentation of Americable of Greater Miami. Will you please take your seats. Alright, we are starting off late. Would you please all take your seats? Would you please extend Americable of Greater Miami the same courtesy that was extended to Miami Telecommunications? (COI.U.1ENT OFF PUBLIC RECORD). Ok, let's begin the presentation. Mr. Charles lletmanowsky: Mayor Ferre, Honorable Commissioners, my name is Charles Hermanousky. I reside at 17301 Old Cutler Road, Miami Florida. I am the general partner and Chief Operating Officer of Americable of Miami. I would like to preface my comments by stating how pleased I am professional and as a resident that this City Commission has had the vision to call for bids for the most advanced cable system available for Greater Miami. I am more than pleased I am profoundly gratified because I, too, have had a vision of the great future of cable t.v. in Greater Miami. A vision which takes all the technical possibilities inherit in cable t.v. and harnesses them to a system that is the most advanced, adaptable and ultimately satisfying of any now available anywhere on earth. A system more advanced than New York, Los Angeles or any other city in the United States. A system which is more than a state of the art. This is a vision which I have backed with my twenty-five years experience in the communications industry, developing system; for nearly a hundred fifty communities around the country. And with a commitment that caused me to sell my interest in a public cooperation and to move with my family permanently to the part of the world I'm totally in love with, Greater Miami. And to begin to build just such a system here in this community, bringing to bear all the knowledge and resources I have acquired in a quarter of a century in the industry. Four years ago, I bought a trouble cable company in Homstead, Florida. It had three employees, it had about three hundred fifty customers. Today that system has a hundred fifty employees who were hired from the Miami area, trained in the Miami area, and had become experienced in every facet of cable t.v. in the Miami area. Today instead of three hundred fifty customers that system has over twenty-five thousand people and is adding more everyday. The system operated with fourteen miles of plant when I bought it, today it has hundreds of miles. What's more it has grown from Homestead and Florida City and Dade County to encompass both the City of South Miami and Key Biscayne franchises that were just awarded to us last year. This growth didn't just happen. It's the results of professional planning and performance. Upon acquiring the trouble cable system in 1977 we immediately installed the most advanced technology available. We built a ten meter satellite dish so we could provide greatly expanded satellite programming to subscribers opening a great new era of protential development for the cable t.v. system of the future. We had the faith in Miami, we made the commitment to Miami without anyone asking us to do so. The opportunities that I recognized other cable companies closed their eyes to. They invested no money in Greater Miami. They hired no people in Greater Miami. Let's see them, where are they? They paid no taxes. They trained no labor force and they took no risk. I did and they learned nothing about what makes this community tick, about it's character, it's problems, it's people and it's great potential and they have acquired no strategically vital properties for the most efficient and economic transmission of cable television which brings up a point of upmost interest and importance. One which wt `eel and believe clew.=1 and dramatically demonstrates the difference between ourselves that have... a company that's done ' it's home work in Greater and that four other companies seeking the same.. Because of Miami's great size there is only one site available in which a single cable television transmitting facility can be constructed that could service the entire Miami area. This is because you can only move a certain number of miles in any direction from a cable transmission facility, if that facility is to effectively relay satellite television signals to a home. A somg;e jead end system is the most efficient system possible. A system that's less expensive build. A system that requires less maintenance, is more reliable and has... is much easier to service. There is only one strategically available site which makes possible cable transmission to all of Miami from a single location possible. This is the area, Northwest 7th Avenue and Northwest 13th Street. To find this site, we looked all over the City. We studied literally dozens of sites within the Miairu area. lie commissioned the nation's largest and most respected single engineering firm to bring in their experts and advanced testing equipmentto help us select the most advantageous site for cable t.v. transmission in the area. The results of their test show conclusively that it's impossible to receive programs from the various t.v. 34 JUL 71981 hatellites in space anywhere but at this specific location and still transmit that signal to the entire City from only one point or one location. The reason for this is because of the substantial signal interference in the air from ITT, ATT, transmissions and other transmissions. Americable acquired this site as the nerve center for cable t.v. transmission throughout Greater Miami. The price was eight hundred thousand dollars. We literally drove and walked the streets of Miami to pinpoint this site and in doing so we believe, we may have begun a contribution to the future of Miami over and beyond an advanced cable t.v. system. Because this site as you will note is located in the heart of the most depressed areas in all of Miami. Americable is now planning to build it million dollar cable television facility on this site, a move that will generate many new jobs, stimulate the entire areas's economy and bring to it a new vitality that can help transform it from a depressed area to a thriving communications center for all of Greater Miami. And let just touch briefly on the cable t.v. system Americable will provide in Greater Miami, the details of which I'm sure you are familiar with from our submission. The system we offer is a triple cable system that with the coaxial cable has almost =mlimited spectrum space to handle a virtually limit less number of channels. We are offering the City a one hundred sixty-four channel system with additional return channels carrying burglar alarm, fire alarm, medical alert, opinion polling, teletex and many other services. We are building an additional fifty-six channel system as an institutional network for all, not some, all Hospitals, Fire stations, Police Departments, Schools, Libraries and various social institutions of the arts and social services. This air communication cable t.v. network cannot only be used among the institutions, but it can also be fed directly into the subscriber homes for the most up to the minute information on important civic events. We are also committed to working with Channel 2 to provide an up link onto the satellite to enable them to distribute Miami programming throughout the United States as well as working with all of our international banks enabling them to transmit data back and forth with all of their home offices regardless of where they are in the world. The future of cable television in Greater Miami, we believe is limitless. There will come a time in the not too distant future when technology will make possible more channels than a hundred sixty-four our current proposed sytem calls for. As the electronics revolution continues we will still be able to up date and adapt our triple cable system to accommodate literally hundreds of additional channels, so that the people of Miami will enjoy far greater access to information and far greater freedom of choice in the selection of the programming that come into their homes than anyone but the most farsighted dreamers envisioned almost a generation ago. And now we will have a very brief synopsis and then we will have Kenneth Myers speak to the firm. Mr. Kenneth Myers: My name is Kenneth Myers of Myers, Kaplan, Levinson, Kenin and Richards attorneys for Americable. Charles Hermanowsky has described Americable's experience, expertise, vision of service and proven record of performance in South Florida over the past four years. This record of service in South Florida is impressive, but it also represents something else to this Commission. Americable's record in South Florida is a fact, not a promise, but a verifiable fact. During the course of these presentations I'm certain you are going to hear numerous promises. Promises about performance, promises about capabilities, promises about deadlines. Frankly, gentlemen, we would be naive not to realize that when a contract of such an enormous size and importance is about to awarded companies in the heat of competition have been known to make claims for their performances capabilities that they will not be able to live up to. I think most of you who na.e been involved in n,,._rous presentations made for government contracts will have to admit sadly, that this is a fact. Our firm has served as general council for Americable for several years. We have not been retained, by the way, just for the purpose of this presentation. We are serving for Americable for several reasons. one, is because of my personal regard for Mr. Hermanousky's ability, integrity and commitment to the South Florida community all of which has been established beyond doubt. Secondly, Americable has clearly demonstrated its capability to create the kind of cable system and service that citizens of Miami seek and deserve. And finally, because when I ask myself the question, what's best for Miami? Not what's best for this Commission or what's best for Ken Myers, but what will truly be best for Miami? The facts inescapably point to Americable. Let's take a look at these facts. Who knows Miami best of all the companies competing for this contract? Only one has grown up, so to speak, in the Miami area. Cable Vision is owned by Toronto based Roger's Cable Systems, Miami Telecommunications is seventy-five percent owned by a Colorado corporation which in turn is fifty percent owned by another out of state corporation. Sixstar Neilson Cable Vision is a wholly owned subsidiary of a California corporation. Vision Cable is a 35 JUL 71�8i subsidiary of Vision Cables Communications of New York, part of the new house +group. only Americable is truly headquartered in South Florida with roots in this community. Americable holds and operates franchises for Homestead, Florida City, Key Biscayne, South Miami and unincorporated Dade County. Please, note too, that while the names of prominent residents in the Miami area truly prominent, are now listed as principles or advisors to our competitors. These are not only very recent additions, I thihk they are also rather obvious attempts to localize what are essentially out of state companies. only Americable has worked under local conditions, obtained local licenses and sat down with Florida Power and Light to work out creative solutions to complex service problems. only Americable has had operational facilities in South Florida for four years. Americable already has Southern Bell, Florida Power and Light and Dade County licenses. An example of Americable's distinctive advantage because of its extensive experience in and knowledge of the Miami area is its locating and acquiring the most strategically located interference free site available in anywhere in Miami. This property as Charles told you in the center of Miami and Northwest 7th Avenue and 13th Street has already been cleared by Compucon and Hughes Microwave, the entities who survey and test areas for cable systems to determine areas best suited for receiving and sending microwave signals. This is the only property which allows for the construction of an efficient, single head end facility. This same complex, although, now being planned to serve Key Biscayne, South Miami and West Kendall will be used for the City of Miami as well. All FCC, FAA applications, etc., are on file now and pending for immediate operation. This single facility will allow Americable to create a single headquarters center for training and administration in Downtown Miami, accessible to the citizens of this city, particularly, in that area, many of whom are disadvantaged and create an enormous cost saving for Miami because of its capability as a single head end facility. Americable already has a Dade County underground construction qualifying license and a loal working relationship, insurance, occupational licenses, etc. This clearly puts us at least six month ahead of any other competitor. What's more, only Americable among the applicants has been an active, vital, contributing force in the economic growth of Dade County. We have already hired people from this area. We have alway trained them, worked with them, help them develop their skills and advance their economic potential. As established residents of the community we have a special feeling for its need, its potential, its unique personality, because for us Miami does not represent simply "X" number of television sets guaranteed to produce "X" number of dollars in revenue. For us Miami represents our neighbors, our families, our futures and the future of our children, because this is the community we live in and love just as you do. That's why Americable will not make promises simply to get a contract. We live up to our commitments and we have a track record to prove it. What about the track record for keeping commitments of the other applicants? It's interesting to know that the other companies have filed applications with a two year construction schedule to build over seven hundred miles of a dual system and a third institutional sytem and yet there is absolutely nothing in any of their histories to justify this kind of past performance anywhere in America. Let's look at the facts, not the promises. These figures speak for themselves more eloquently than anything I can say. Just remember Commissioners, Miami will require over seven hundred miles of dual Plant, that's fourteen hundred miles of cable and electronics. Exhibit one, Miami Telecommunications, Golden, Colorado, two years to build a hundred miles. Daytona Beach, three hundred fifty miles granted in 1968 is not completed yet. Billing's, five years to build tw^ hundred fourteen milez. Knoxville, six years to build five hundred twenty-five miles. Olympia, granted in 1972, two hundred forty-nine miles still under construction. Exhibit two, Cablesystems Miami, Syracuse, it took two years to build only three five miles. Calgary, three years to build six hundred twenty miles. Exhibit three, Vision, Concord, two years to build a hundred fifty miles. Henominee Falls, not completed yet at fifteen months. Redford, a hundred sixty miles, not completed yet at fifteen months. Greentownship, a hundred seventy-seven miles, eighteen months. xhibit four, Sixstar, Pamona, two years, two hundred seventy-three miles still under construction. Orange County, sixty-six miles granted in November 1979 won't be completed until December 1984. Tuscan, severity -three miles granted March 1979 won't be completed until December 1983. Culver City, sixty-one miles granted in May 1979 won't be completed until April 1984. We have a substantial headstart on these companies in terms of plant facilities, licenses, local working relationships, etc. We believe we can complete the job in less than three years, but then Americable has a reputation for meeting its schedules and keeping its commitments. So we have been conservative deliberately in our estimates. Further, may I point out 36 19 81 JUL 7 home other interesting facts and figures that may have a definite bearing on whether the competition keeps their promises and to whom those promises will be kept. Over the next two years Miami Telecommunications has pledged to build more than two thousand two hundred twenty-one cable miles outside of South Florida. Cablesystems has pledged to build two thousand sever hundred nineteen cable miles outside of South Florida. Vision is committed to build one thousand seven hundred ninety-two cable miles outside of South Florida in those two years. And Sixstar has pledge to build more than one thousand two hundred seventy-three cable miles outside of Miami. On the other hand Americable's commitment outside of Miami during this same time period is limited to a total of only four hundred fifty two miles. Americable's overwhelming commitment then is clearly to Miami. Your consultant Mr. Pilnick, states in his response to the applicants "It is still believed that a proportionally high level of existing financial commitments maybe a valid indicator of future vulnerability". The other applicants have pledge to construct a total of more than eight thousand cable miles outside of Florida during the same time period they have promised to complete their work in Miami. And if you are thinking that a million dollar performance bond assures that whoever is awarded this contract will deliver what it promises, consider this. The scope of this contract and its duration is such that losing a million dollars performance bond if they don't finish in two years is almost insignificant to these companies and to us. One million dollars is really a relatively small amount to risk in comparison to the sizable profit potential here. Financially, Americable could afford to take this risk and tell you we are going to finish in two years. But for us, our word is more valuable commodity than money and that's why we have quoted a very conservative estimate of three years. Which brings up another important point. Where will the profits from this contract go? How many millions would be paid in management fees to a company based in Canada or in California or in Colorado or in New York or will those millions stay in Miami with a company headquartered in Miami to create more jobs in Miami, more economic growth in Miami. The question is, how many millions will be taken out of Miami over the next fifteen years or how many millions will stay right here in the community working to create the kind of economic vitality and prosperity that affects all our lives. Again, I ask you to ask yourselves what's best for Miami. And to underscorce that question, I think we have to ask ourselves still more probing questions. Questions who's answers may raise doubts rather than ease them, but which still must be asked in the clear light of public scrutiny. How about our competitors projection of interest rates on their debt to average between twelve percent and fifteen percent over the next fifteen years. Now, that may sound comforting and reassuring and it certainly makfs their bottomline figure on rates appear attractive, but what if the interest rates remain at their present level of twenty percent? This is a realistic projection which Americable has made based on hard, current, unpleasant facts rather than high hopes and speculation. If our projections are right Americable will deliver the system it promised at the price it promised, but all the other four companies would finding their operating budgets operating at severe deficits, as much as one million dollars for a single interest point above their projections. And of course, after the initial three year rate freeze period has past these deficits would be passed only to the subcriber in the form of higher rates. On the other hand, if the rate goes down below twenty percent Americable can lower it's rates. Again, Americable is eager to obtain this franchise, but not at the cost of making unrealistic projections which we and the citizens of Miami would be forced to live with in the form of higher rates. Now, let's take a look at the rate structure for subcribers for a minute, which to say the least, is confusing to layman. These rate structures can appear so complicated and convoluted that it's really become a puzzle to figure out exactly who is offering what and for exactly how much. But once all the smoke and confusing clears three very simple facts emerge that are not readily apparent at first glance. Number one, Americable's installation charge is listed at eighty-nine dollars ninety-five cents, but in actuality potential subcribers will offered installation at no charge whatsoever if they request it within a forty-five day period after the cable passes through their location. The eighty-nine ninety-five fee will be only for those who request installation after the forty-five day period. Common sense tells us that most subcribers will decide in favor of installation that isn't going to cost them anything and that has been the case in most instances in actual practice. Point number two, Americable is the only cable company in this presentation that will make the Spanish movie channel Gala Vision and the popular home movie service, Showtime and twenty four hour movie channel available to subcribers without requiring the subcriber to pay any addition montly services with additional monthly charges. At the Tier I level and point number three, when you measure the total range of services and prices only one company 37 JUL 71981 iti this competition, Sixstar Neilson offers rates that are lower than Americable and the difference between those two companies rates are nominal. Now, how about each company's ability to meet its legal obligations and satisfy its customers. Certainly, Americable is not perfect. It would be impossible to run a company the size and scope of ours without receiving some complaints, but our company's history by and large is one of harmony and performance. Here is what the Mayor of Homestead has to say about how well we keep our promises and I "In early 1980 Americable at its volition and at a considerable expense replaced the former owners nineteen channel system to the latest state of the art in order to provide the newest services to its Homestead subscribers. We are very happy with Americable." This is what the Mayor of Florida City has to say about Aanericable and I "I called Hermanowsky and asked him how long it would take to complete construction in Florida City. He told me one year. He was done in three months". They are our kind of people. They live up to their word". On the other hand Miami Cablesystems counterpart in Minneapolis brought action to prevent a City Council resolution rescinding their franchise award. They lost the suit and the appeal and the franchise. Miami Telecommunications is involved in a number of suits against the cities of Boulder and Jefferson. It's presently being suited for anticompetitive business practices. The case is still pending. Sixstar Neilson is involved in civil liability proceedings as follows; Violations of antifraud and registration requirements of Federal Securities Laws against the brokerage firm owned by a company officer and owner, Stuart Harris. Three major owners of Sixstar Cable Vision, Stuart Harris, Roger Mazio, and Paul Skolsky as part of Cable Tele were charge with having fraudulently sold cable television franchise interest considered as unregistered securities which should have been under SEC jurisdiction. Consent Decrees were entered. Vision Cable of Miami an intermediate owner of the stock of new house group were convicted of conspiracy to set maximum prices for the resale of its newspapers. Neither Americable nor anyone working for the company has ever been charged of a violation of SEC regulations, fraud or conspiracy or has sued any municipality or been sued by any city. Is it not true that in an era when public trust in government has been tested and found wanting, that it is imperative that even the appearance of corruption or the waste of taxpayers money in costly lawsuits be avoided at practically any cost. Again and again, the question is the same. What's best for Miami? What's best for the people of Miami? Again and again, in this particular case the answer is the same. In terms of experience and professional knowledge of the local market and local conditions, in terms of knowing the community's needs, in terms of having a headstart by reason of facilities in place and operating right now. In terms of system capability, fiscal responsibility and independence from parent companies located thousands of miles from Miami. In terms of keeping millions upon millions of dollars active here at home in Miami's economy rather than having them sent and spent out of state. And finally, in terms of a record of performance for municipal clients free from costly lawsuits and free from any charges of fraud, price fixing or violation of any SEC regulations the answer comes up the same in every instance, Americable. What's best for Miami, Americable. The only cable television company that can honestly call Miami home. Mayor Ferre: Alright, thank you, very much. Mr. Clerk, would you tell me how many minutes that was? Mr. Ongie: Thirty-eight minutes, sir. Mayor Ferre: Thirty-eight minutes, ok. We how have a presentation by "i.sion Cable of Miami. How long will it take Vision Cable to set up? Is the representative of Vision Cable here? (BACKGROUND C0Idt1ENT OFF THE PUBLIC RECORD) Mayor Ferre: Alright, we will take a five minute break and then ladies and gentlemen we will hear Vision Cable and we will take a one hour dinner break and...(COMMENT OFF PUBLIC RECORD). We will take a five minute break. We will then hear Vision Cable. We will start in five minutes sharp and we will break out around 7:30. We will meet together again at 8:30, ok? That's the timing. NOTE: AT THIS TIME THE COMMISSION TOOK A FIVE MINUTE BREAK. Mayor Ferre: Alright, we are all here, would you begin your presentation? Mr. Barry Kuten: Thank you, very much Mr. Mayor and ComirLissioners, my name 38 JUL 71981 A A is Barry Kuten. I'm an attorney at law. I'm Secretary and general counsel of Vision Cable of Miami. Before I was involved with this company, before I committed to be involved I had the opportunity to evaluate the character and integrity of this company. I went to New York. I went to Fort Lee, New Jersey. I went to Clearwater. I saw their presentation that they made with their cable franchise. I evaluated their offices and saw their security system and I saw their program offices and I talked with people that work at Vision Cable. I then told them that I was willing to be a part of Vision of Miami and offer myself as a partner with them to seek the franchise for the City of Miami. I then took the opportunity to talk to the finest people that I know living in the City of Miami and the County of Dade, people of the highest character, integrity, outstanding businesss people, political leaders here that I knew in this community who serve this city. Because we are going to havo a partnership with the City Commission, people of the City and this company when the franchise is granted. We are the ones you are going to have to deal with. I want you to look at eleven local investors of this company selected. Willie Bermello, head of Calle Ocho Kwanza Club of Miami. David Blumberg, Plan Unit Development on the Board of Directors of Southeast First National Bank, outstanding businessman in the State of Florida. Armando Codina, outstanding businessman in the State of Florida and this community. Hank Green, President of the Greater Miami Chamber of Commerce. Linda McGowan, outstanding and leading professional movie producer in the State of Florida. All movies that cover the State she is involved in. Bob McKnight, Senator Robert McKnight, outstanding Environmentalist, outstanding Senator in this community. Carrie Meek, Urban Coalition Leader for the Blacks, Dade Delegation and the Florida Legislature, outstanding community leader very vital, very committed to the riots that took place in Liberty City last year. Anne Myer, Chairperson of the Governor's Commission of the Status of Women in the State of Florida. Athalie Range, ex -City of Miami Commissioner, never involved in a private endeavor always public. She is on the National Board of Amtrak, City Commissioner, Vice -Chairman of this Board and the past Secretary of the Department of Community Affairs for the State of Florida. 4IN Ed Skilling, Director of Creative Commu icationo Noble Peace International University, Poetarian of the State of Florida and a Prize nominee for poetry in his field. There is no buy outs for our investment, our investors. They're buying their interest in this company. They're not forced to sell at any time. They had to put up hard cash for their investment. They're committed to this company and to what we're doing. There's no gifts involved in Vision Cable me Mguarantee our guarantee, and these 11 people of Miami in joining with me, integrity and our character. We'll deliver the finest, the fairest, the most honest cable communication system in the world, right here in Miami. You have my pledge and my commitment. You have the pledge and commitment of the people that are on this board, that are part of this investment group who have never let this community down, or this State, or any business person ever. I would like to now introduce one of our subscribers, a member of our group David Blumberg. Mr. David Blumberg: Gentlemen, I undertook on behalf of our group to confirm the financial integrity and the construction performance of the Vision Cable people. And I found that within our combined group we have $1,000,000 of net worth, an excess of $1,000,000. That means that there will be no problem with financing the capital improvements and over the 15 year period, depression, economic setback, anything bilit of a we'll be able to maintain this service without any p y failure, or default, or anything that would adversely affect either your revenue or our customers. Secondly, I undertook with my construction people to check the construction record of Vision Cable people. And I found that they invariably performed within their commitments. The City of Clearwater, for instance, they constructed, will have constructed over 500 miles within a 2-year period as committed. I could which tell y o thatoked into, in addition to the other aspects of our proposal, that I can assure you of the financial resources and the construction performance. At this point, I'd like to introduce to you the Chairman, our chairman, Mr Knafel. Mr. Sidney Knafel: Thank you, David. Mr. Mayor, honorable commissioners, ommissio ers , the detail of our proposal to Miami is known toy , and will be wed in the ensuing presentations. We believe it is a cable communications system not just a cable television system. Communications system unequaled by any anywhere. But what makes Vision Cable unique is not just this proposed physical investment and range of services. What makes us importantly different for Miami is our dedication to community involvement which is a fundamental tradition for Vision Cable. You know of this checking the community for both New House and Vision Cable Communication to operate. It is demonstrated by the presence here this afternoon of Robert Myers, President Neuhouse, Michael Wilner, the President of Vision Cable of Miami is a Dade County native, and is demonstrated by the presence here of our shareholders and of our management for cable to respond to your inquiries in their areas of expertise. If you'd stand up so the people can see who is here. Thank you. This community involvement could not be more precisely evident than by the makeupof local shareholders who represent nearly one quarter of our ownership, and who represent the real Miami. They are all activist building their City in their individual private endeavors. They are true leaders of Miami and are a piece of the three ethnic strands which must be intertwine2 equally to create a moving successful Miami. We have shown you our involvement by being the only applicant to survey the City's interest before making a proposal, and then preparing that which is wanted. For example, the most important item in the minds of the citizens as indicated by our survey is really quite simple. Clear reception of existing television signals. And we are the only company providing that free. Example, a vast majority wants full service, so we made sure that our rates for full service would be ,;.—,,;Litive. Further, we have specific quantitative involvement by proposing $2,500,000 for Dank Green tVision ole ld id Training Center there is a real Carrie Meek on a committee with need for jobs in Miami. We're involved with $1,500,000 for institutional programming. We're involved with $1,500,000 for independent access company. Because Linda McGowan wanted to further Miami as a creative 40 JUL 71981 Mt, Xnafel (continued): art center. We're involved in channels for Latin, Black and Anglo programming. We're involved in a channel for the handicapped. We are involved in the Minority Policies Committee, we are involved in 3 operations centers. We are involved with 21 community viewing centers and we are involved with $34,000,000, committed to maintain a system that would always be up to the lattest state of the art. We did that because Ed Skillings told you of all the technical changes that_ he has planned. And then I told Ed I expect more. and we're prepared for it and committed to make sure that Miami benefits from it. Finally, our community involvement has been evident on the streets of Miami for more than a year now. The Vision Cable operation scrapbook has shown you and your citizens what a group cable communications system can be like. And that is to be of service to the people who you, you tOO9 sit here and serve. Now, I'd like to introduce our Vice -Chairman, who speaks for the company, Athalie Range. Mrs. Athalie Range: Thank you. Honorable Mayor, and Honorable Commission, I stand here before you today as a representative of Vision Cable of Miami. As a representative of Miami and a former Commissioner. I sat where you are sitting, and I know the incredible responsibility you have to over 400,000 people who reside in the City of Miami. All of you know me as someone who has actively worked over the years on City projects without thought of remuneration. If anyone intimately knows the pressures, the problems and the pain of this City, I do. I want to tell you why I am involved and why, in my opinion, Vision Cable should get the City of Miami franchise to deliver cable t.v. Vision Cables proposal and in the opinion of a consultant second best. In my opinion, it is the best. The best for the people, and the best for the City of Miami. 4y? Th Because Vision Cable has made a major commitment to provide $2,500,000 for a Vision Cable Training Center. Think of the impact that that will have on economic capability of our youth and adults. A career opportunity for training and employment. The training center is a Vision Cable commitment. $350,000 to start, and $150,000 annually. This gentlemen is not welfare. It's commitment. Now, as the job opportunity for our residents. I sit on the Minority Policies jobs. Committee of Vision Cable. Vision Cable is committed to providing J 100% of the people hired will be local people. I do contend that Vision Cable is truly local. Vision Cable is providing l participation cal white andns. Look involvement from local Latins, local blacks, andat our shareholders. Every one of them has a record of mmunity Cable. involvement. We actually help to make everything happen Look at our minority involvement. It reflects what makes Miami the rich cultural city it is. I am a shareholder. So are all the other fine people seated here. I have status. I serve as Vice -Chairman of the Board of Directos. And I am, and have always been available and accessable. I would have you know that I would not let any company ruin my good standing in our great community byis mm the lineitinR self to here today with a mere window dressing. No, Y integrity art Vision Cable, and I assure you that I am comfortable w ithvbeinta o our of Vision Cable. Vision Cable is going to bring neighborhood, all of our neighborhoods, so that everyone, rich or poorcan see. Let me tell you what we plan to do. We plan to provide free viewing centeLS. Also connected to the institutional network, a 2-way network of colleges and universities. Where can you find a better educational tool? Our citizzea�stoneed VisionCity ofCable. Vision Cable is going to provide $100,000 per ye ar or institutional use. Vision Cable is going oin to provide more for people. And I assure you, far fewer problems forour City. Our record stands for itself. Check it. A superb performance in other cities. Vision Cable has promised realistic things everywhere in our culture because the money, the right people, and the technical expertise is with Vision Cable. We have the highest localprogramming ofntheucompaniessioAllacitizensiwilldes the lowest installation rates of get a chance. Cash flow may be hard to come by. Service may _ be hart to get. Lawsuits can fly back and forth. But _ bc.tlemen, Vision Cable, no lawsuits, no disgruntled city fathers, just plenty or satisfied, happy customers. Local stockholders who are not the kind of people who shrink from public obligation. Gentlemen, I ask you, please vote not only to provide but to chappenan maintain a superior sro er cable t.v. viewing to your citizens. Keep in mind what tthinkalso of a franchise is granted. Think of what can g g, bu 41 JUL 7 1981 0 0 Mts. Range (continued): the local strong support group locally involved personalities who are all partners in Vision Cable, upon whom you can depend for the service Miami so richly deserves. ;hank you, and I now present Mr. Willie Bermello. Mr. Willie Bermello: Honorable Mayor, Commissioners, my name is Willie Bermello and I've been a resident of Dade County for over 20 years. My offices are located in downtown Miami. And as I look out my window and I see the bay and I see the changing skyline of Miami, it gives me a unique perspective. This touches upon a particular dimension about cable communications system that I'd like to share with you. As I look at the changing skyline, as I look at the many new banks that have come, volunteered to come to our area, I look over across the Port of Miami, the increase in trade and commerce, there is no question, and I think you would agree with me, that Miami is on its way to becoming a world class city by the 1990's. I ask myself, what is the role of cable t.v. in Miami for the 1990's? I submit to you that as I, and I'm sure you would too, enlighten and analyze the history of those cities tnat Have developments in your travel and reading seems to stay in your mind. Those cities that when you visit, you wish you could live there, that you enjoy it, that you'd like to come back to. The things that kind of grasp your attention in your memory is not the many banks, or the many tall buildings, it's a �Iienna, it's music, if it's in Paris, it's art. If it's in London, it's the performing arts. If it's in Florence it's architecture. It is cultural elements tnat in a sense we remember is a message. I deeply believe that cable systems as a communications form will be the new art form are we go ove to the 21st century. It will allow us to report the cultural richness that our area has to offer. I will not bore you with many of the details that have already been expressed so eloquently by my fellow shareholders. I can say to you that I think 1 am a deep believer about this vision of Miami and what it can be and I've analyzed the thoroughness as our proposal, as well. as those of our competitors. I am confident, and I am convinced that the many opportunities for access for our tri-ethnic multi -racial community, our many opportunites for local prgramming, gives the City of Miami and its residents the opportunities that are necessary for this reporting of this cultural revolution that is taking place in our community today, and will allow our community to give a legacy to our future, to go down in history. Thank you very much. I'd like to at this time introduce Sid Knafel. Mr. Knafel: We are in the communictions field and have decided that the most succinct and effective way of informing you of our proposal is with this 14 minute documentary report of the City of Miami. Lights please. (AT THIS POINT, MR. KNAFEL, REPRESENTING VISION CABLE, MADE AN AUDIO- VISUAL PRESENTATION BEFORE THE CITY COMMISSION.) Mayor Ferre: All right, we will be back here in exactly one hour. UNIDENTIFIED SPEAKER: Mr. Mayor. Mayor Ferre: All right, go ahead. Excuse me. How much time have they taken? Mr. Ongie: 37 minutes. Mayor Ferre: You've got one minute. Mrs. Carrie Meek: Mr. Mayor, Commissioners, I'd like to say to you, you saw here today, sometimes the best presentation is looking at the weak points of another presentation. I say to you, do not be fooled. Po not be over -ridden by what you saw today from one Company, Americable which pointed out the defects of the other companies. Many times that is the only offense that a company has to show that. I want osay to you that Vision Cable is going to bring something to you that You didn't see in Americable. It's anew time, a new day in 42 JUL 7 1981 0 Mrs. Meek (continued): Miami. There has to be a chand age, mustbcomes� there are Hispanics, there are whites. In this day g , Y up with a company that can represent the true ethnicity of Miami. You must look at and be able to compare if a company hasn't done very much, which they don't have very many weaknesses. They havn't had a track record. It's been hard to develop one. I'll tell you why. If you have not achieved anything, if you have not worked very hard towards doing things in other cities and .... this is a big business. This is a big franchise. This is not a next need hoodfinaBind of You would n mom & pod business. You would need money, le who have Would would need equity capital. You would need people p experience and expertise in programming. This is a very very asy ammissioners, mic offer that Vision Cable has given to you. I'm saying to y ou you are responsive to the people. you must look for the best. A quality affair. nhereetoday. Lookwhat at all those happened fu zziness ana all 'have the most clarity other presentation...... nd Mayor Ferre: Carru��.y°Wfiat'satheat talhour timein gtaken nowabythisegroup?You'll have a time to reb Mr. Ongie: 38 minutes. an our and we will k here in Mayor hour. NowWe we Will haveill ktherlasthtwo presentations and c andthen... exactlyyone Ferre: THEREUPON, THE CITY COMMISSION WENT INTO A BRIEF RECESS at 7:40 P.M., reconvening at 8:50 P.M., with all members of the Commission found to be present. Mayor Ferre: The next presentation is cable systems of Miami. And if you would all kindly take you seats, I think we might be able to get going now. Now gentt gentlemen, ladies, what we may end updoing precau soon, I have a feeling we re going to start getting pretty tried and here's —let me throw out a thought. Assuming we get started before 9:00 P.M., the next two presentations will take us to 10:00- 1 have a feeling it will probably be somewhat after 10:00. Then, of 5 minutes of rebuttal, Mr. Gerstein, I want you to listen to this because this is a decision you all are going to have make. Instead of going through the format we had before, which was half an hour with only 5 minutes rebuttal, I've got a feeling that everybody is going to want to rebut more than 5 minutes. So maybe what we'll do, is give you all say a 15 minute interrupted crack at rebuttal, all 5 companies, and that would, that 75 minutes which is an hour and whatever, it will llbe anear hour and a half by the time we're through, so that p uts 12:00. Now, does that sound more reasu,— Ae. Does anybody... (INAUDIBLE BACKGROUND COM1%1ENT PLACED OUTSIDE OF THE PUBLIC RECORD) Mayor Ferre: Does that sound more reasonable? Does anybody object to that format? Mr. Plummer: Well, let me just, I don't object, but let me ask a question. Mr. Mayor, as I indicated before, I've got about an hour of questions. Mayor Ferre: Do you want to ask them tonight? yr. Plummer: Well, what I might... Mayor Ferre: I think it's better in a way because that way the input of the questions are there for next time. 43 1981 JUL 7 4 to Mr. Plummer: I've touched on a lot of them. I would be happy, if there is a way, I don't know that there is. I asked Mr. Pilnick when he was returning to California, and the answer is in the morning, at 8:30. And I'm not staying here to reduce all these questions to writing tonight. I would prefer to do it that way if there's some way that you can get that to him. But is he going to be able to respond before next Tuesday. Mayor Ferre: Herb, on the record. ve t time for ttal Mr. Herb Leviy to be the record, we that long. It'sdnottgoingeto beaproductive.TeIu is necessary that can be shortened considerably. Mayor Ferre: Let me, Commissioner Carollo, this is where we're at. It's almost 9:00. If we start our presentations now it will be after 10:00 when the 2 are finished. I was saying rather than go to that half hour format, because what's going to happen is if we go to the half hour format, we're going to go way beyond 12:00. And I'm leaving here at 12:00. And so therefore, somebody is not going to get a chance tonight, and that's unfair. And the people, I'll tell you who is not going to get a chance, in my opinion, are going to be Americable, and Cable Systems. And I don't think `hat's fair. So, the other alternative is that we let each one of the 5 in the order that we have here, have a 15 minute period to rebut and that will take us an hour and a half. And then, Plummer, if you want to get into the questions that you have, which I think we really ought to get into the record, that's about an hour. We can get out of here by 12:30. Mr. Plummer: Well Mr. Mayor, there is only really one serious question that I have. Okay? And already there's been some thoughts expressed by yourself earlier and by Mr. Knox. I am still of the thought that says that I feel that we must have dollar signs delineating these factors that are what I will call in broad terminology, the words numerous, many. I think that we need dollar signs attached and a timetable as to when they're proposed to be done. Now, you know, I've heard my good friend, Mr. Knox, say that that's going to open up the door to problems. 1'ou know, its got to be a Commission decision because I'm not going to force this gentleman to... I'll tell you what I think maybe is a viable alternative. Is maybe those companies that want to voluntarily do it on their own. I don't know what the answer is. Mayor Ferre: J. L., let me tell you what I'm concerned about. And I hate to use specific firms, but... Mr. Plummer: Well don't. Mayor Ferre: Well, okay. There's a firm, when I say what I'm going to say, everybody is going to know who I'm talking. There's a firm, for example, that uses words such as multiple. Okay? Now, which is a nebulous type of a thing. I know what you're concerned about. There's anothe, Firm, for example, in that section leaves it completely blank. Is it really fair oottnebulous, but theleft one whoblank saidfor multiple towho definenebulous. what to define ... n multiple means. Mr. Plummer: Mr. Mayor, I'm not looking for the ones who left blanks. Blanks to me mean that they're not going to do anything. That's obvious. Okay? Let me tell you where it leaves me without doing it. It leaves me with only those items in which they attach dollar signs, and attach timetables to be considered by me, and throwing lall the dealrest ofkit Out the window. Now, you know, I'm saying to , factors. Mavor Ferre: J. L., we're betting into a discussion which in a way is ra*zlly not fair for the two presentors that are left. So, I would like to do this. Let's see if we can get this far anyway. We'll go to the two presentations which will take us past 10:00 o'clock. Now, ldominutes, es anybody object to then giving the 5 applicants 10 minutes, 10 minutes to rebut anything that they want to. That will take us almost 44 1981 JUL 7 4 2 Mayor Ferre (continued): to an hour. You can go into your questions for an hour, and then we break up. And then, we'll meet again. Now, I'm willing to meet on Friday. Mr. Plummer: I cannot. I'll be out of town. Mayor Ferre: I'm willing to meet on Monday. Can you make it Monday? Mr. Plummer: Mr. Mayor, what I would prefer to do is to meet on the 14th. I have my calendar set for the 14th. Now, I don't know what others have on the 14th. Mayor Ferre: If we can do it before that, J. L., you know, I'm available from Friday on any day. I will change whatever I have to change. Mr. Plummer: You know my history. My history is always bad on Mondays. Mayor Ferre: Tuesday. Mr. Plummer: Tuesday I have set aside. No problem. Mayor Ferre: Tuesday's all right? Mr. Plummer: 14th I have set aside anyhow. Mayor Ferre: Tuesday is the 14th. You can't meet Friday, you can't meet Monday. Mr. Plummer: 1:00 o'clock on Tuesday? Mayor Ferre: The previous scheduled day was Tuesday the At 1Pth, is that correct? At what time? Anybody remember. Mr. Plummer: A need to set a date and time for the third public hearing July 14th, at 4:00 P. M. as suggested. Mayor Ferre: Where did 4:00 P.M. come out of? Mr. Gary: No, thatawas discussedvattthe dlast edate.t or a firm City commission meeting. It was the date was not confirmed. Mr. Plummer: 1:00 o'clock would be better for me. Mayor Ferre: 1:00 o'clock? Is that all right with you? The 14th at 1:00 o'clock? (INAUDIBLE BACKGROnTD COMMENT PLACED OUTSIDE OF THE PUBLIC RECORD) he ntati Mayor Ferre: All right. Okay. ions. TheThen nextlet's precentor with is tCable eSystems ons. We have two mor . yr Miami. Is the applicant here. Mr. Herb Levin: Mayor Ferre, honorable eiveningcemMYrs of name iseHerb Levinn, Mr. Pilnick, ladies and gentlemen, good Vice -President and General Manager, radio stations WQBA AM and FM. And a partner in Cable Systems -Miami. The Cable Systems -Miami presentation will deal in will clearly showifics only. Dyouawhyiwesaredtherbestmcompanyswithythe doing so, we will y best proposal. Mr. Plummer: Excuse me. Herb, is that light necessary? Mr. Levin: I hope not. It's blinding me. Mayor Ferre: Couldwe Ve that Have youhpututhedoff clock onkyet?re and hold up the clock for a moment Mr. Levin: He's going to turn it on. 45 JUL 71981 4 E Mayor Ferre: Are we ready to begin now? All right, put the timer on. Mr. Levin: I think as you listen to our presentation this evening, you'll be convinced that we're the best company with the best proposal. The more you hear about cable through this evening, I think the more you'll agree with us. Our company is a partnership between 6 Miami Prea residents, and the worlds largest cable television operator. I'd like to tell you why we got involved with them and how the partnership came about. The first step was bringing together a group of local people who could work together and who we felt represented Miami's diverse groups. It's a group of the right combination of experience, foresight, and a desire to play a positive role in Miami. A group committed to Miami's future. I think you know all the members of our local group well. Garth Reeves, Sr., publisher of the Miami Times, Don Reed, Raul Masvidal, President and Chairman of the Board of the Biscayne Bank, Real Estate developer Ed London, Representative Tom Gallagher and myself. We're a small group but we think we have a good cross-section of representation. After assembling the local group, our next step was to find the best cable operator in the country. And therein lies an importance difference in the ownership structure of the applicants before you tonight. Rogers Cable Systems, our senior partner, did not come to Miami, and to use a familiar phrase, rent citizens. Quite the contrary. We decided the best way to ^uarantee the best system for Miami was for us, the local group, to find the best cable operator. And we began that process by setting down our criteria, and looking at only large multiple system operators with experience. Our criteria was, and we think yours should be first and foremost, the management team. The team that's going to build this system. And we found Cable Systems had top flight executives with outstanding track records. Secondly, the company had to have excellence in engineering. Last year Cable Systems as an indication of that excellence, spent over $4,000,000 on research and development. Only Warner can match that kind of commitment. And third, we're an acknowldged leader, innovator, in community programming across this country. Next, was experience in large urban areas, areas the size of Miami and even larger. And again, Cable Systems is the leader by a large margin. No one's close. Our final criteria, probably the most important one, is an intangible. Integrity. A quality acquired by reputation. For this we did two things. We didn't talk to the Cable Systems people about it. We talked to people in the industry who knew of them. And their comments were always the same. Cable Systems was highly regarded. The second thing we did, which I think is something all of us would do, we when up and met them. They're good people, and people we could be partners with. For every criteria we checked, Cable Systems was the leader. Management team, engineering execllence, programming experience, urban experience, and integrity. There is one underlying theme in this partnership and in our proposal. It's quality. We feel we're the best company for Miami and as you hear more about us this evening, we're sure you'll agree. Now, I'd like to introduce the President of U.S. Cable Systems, Inc., Phil Lynn. Mr. Phil Lynn: Honorable Mayor, members of the Commission, Rogers Cable has become the largest cable television operator in the world. We operate systems in New Yorn, California, Oregon, Minnesota, Europe and Canada. We're an international company with unmatched experience in operating large urban cable television systems. Assuming final ratification of the U.A. Columbia Cablevision acquisition, we will have a total of nearly 2,000,000 subscribers, including some in the State of Florida. Of course, we have structured the acquisition separatley so that it will have no financial impact on our solid commitment to Miami. Last week, in order to further strengthen our position in cable, we sold our last non -cable asset a move theater chain, for approximately $50,000,000. Cable Systems has proposed a $45,000,000 dual cable network with over 100 channels, with the following outstanding features: a satellite uplink for hemispheric communications backed by a proposed Puerto Rican super station and programs imported from all major Latin American countries. A comprehensive security package, a prepayment to the City to bridge the gap between present needs a future resources. Local ownership and community responsiveness. We've had 5 local advisor groups in place for over 3 months. More than $8,500,000 over the life of the license for We are special programs, crime prevention and multi -cultural initiatives. going to detail these further. Reference was made earlier to law suits 46 JUL 7 i981 0 A Mt. Lynn (continued): and a note on Minneapolis, it was a lawsuit instituted by ourselves to recover a franchise that was awarded to us by the City of Minneapolis. And now the City has decided, I guess on our suggestion, to have a rebid. So we're currently active in that City. But in our 30 year history I should record with you that we have never been fined, or been sued by any City. We have never been charged with or fined for not meeting construction deadlines. We have never been penalized for non-performance. We have never been criticized for being in default of the ordinance requirements. We have never sold or disposed of a franchise. We invite you to contact, as you already have, officials in any city in which we operate. We're proud of our record, keeping or word. We operate the largest single system in the world in Toronto with over 350,000 subscribers in a single system representing over 18 multi -cultural groups. And this experience is key to building large sophisticated urban system, such as being proposed by all the applicants here in Miami. In fact, we are currently building or operating 5 communities, right now,lith assize similar to that of Miami. And I'm not sure that any other app building, or operating a system in the size City of Miami. Experience shows up in building expertise. We've discussed build rates before. Can it be done in 2 years as we have suggested? Well, we have to build in the suburbs of Minneapolis a 700 mile system over 18 months. And that includes one vicious winter. We're ahead of schedule. In 13 months, we've built 425 miles in the State of California, in one system. our company lt's specialized experience also extends to community programming sery a service we've been offering for over 10 years. We do it in every ofsingle sty one of our systems. Last year we produced more than 20, hours men service programs in over 20 languages, and involved over 14,0me And in the public testimony you heard earlier today, I think you saw evidence of our community involvement. We backed this programming activity company -wide with a budget in excess of $3,000,000 annually. This policy will bring to Miami a solid commitment to guarantee a healthy, multi -cultural service. In fact, our multi -cultural programming effort was directly responsible for the birth of North America's first full-time multi -cultural broadcast station. We're a technical leader in cable television. To insure our leadership, we've developed a separate engineering division with a pure research and development budget of over $4,000,000 annually. We have recorded many first. We are innovators in Miami by our unique system design which incorporates the subscriber in instutional network in two cables. This is a new design and for a large urban system, it is unquestionably the only economic way to bring the institutional network to every home and business, to every public institution in Miami. The design was first offered in a recent bid we made in the City of St. Paul. It was well received by the City there. It was well received by the consultant, CTIC, whom you've been involved with here. In fact, we were rated first on that design. We are the only company here tonight that has an actual and extensive operating experience in two-way interactive services, such as opinion polling and talk -back services and alarms. We also had an early involvement in the development of Teledon, the international information retrieval system, a home video library system. Teledon has become the leading information retrieval system in North America as evidenced by AT&T's and CBS network's recent action to adopt a Teledon compatible format. We're the only company to offer Teledon, and we're the only applicant that offers you an information retrieval system that would be compatible with the standard proposed by AT&T. Our home security service in Syracuse has already been credited with saving lives. And it's the same proven technology that we're offering here in Miami. Through Rocky Pomerance we have a professional, professionally approved central monitoring system already in place. You're going to hear more about that from Rocky. So, when we say that Cable Systems is a company that delivers what it promises, we're not just boasting. We're proud of our record of proven performance in city after city. Because for us, a cable television franchise is more than just a commercial opportunity. It's a public trust. We look forward to working with you in the City of Miami. Now, I'd like to turn our presentation, at this point, to turn to Rocky P =crance. Thank you. Mr. Rocky Pomerance: Mr. Mayor, Commissioners, my name is Rocky Pomerance, and I come before you today as a security consultant for Cable Systems Miami. I don't have to tell you that a major problem facing the City of 47 JUL 7 1981 40 Mr. Pomerance (continued): Miami today is crime. As a result, the police and the criminal justice system have been strained tonthe eslimit ponse and thist seek new ideas and technology to meet the problem. need, Cable Systems -Miami and I have developed a multi -faceted approach by which the technical resources of cable t.v. can be used against crime. Our crime prevention program will make Misma channel for dedthe rest d to of the nation. The first aspect oour program week, available free of charge crime prevention, 24-hours a day, 7-days to all subscribers. We have met with Dick Hunt, who you've heard here today, and the Executive Board of the Citizens Crime commission tofworeater Miami, and they have agreed to act as the primary organizationThere are with me and other groups in the development of the programming. countless examples of programming that can be useful to our citizens. One however, would be a series of programs designed to educate residents how how to protect themselves, their loved ones, their homes and their property. It's significant that the control of the programming for this s led channel will be in the hands of responsible group against crime. I will act thesevovgroups1andhCableuggle Systems to insure the implementation. Cable Systems has committed not only the necessary equipment and technical personnel, buto$500,a00tonde used over the life of the system for funding. We also propose crime prevention channel. This channel will be restricted for before an official institutional network. But unlike any ether proposal you today, this channel will reach the entire City of Miami. Now, the significance of this is that in an emergency, for example, all police and firemen who live within the City limits can be contacted simultaneously through the cable t.v. network. A primary key to our defense against crime is an afforadable and effective home security system. Cable Systems has combined their Syracuse cable alarm experience with Gibralter Central Security to provide the service. When I retired, I created this alarm company, Gibralter which is totally computerized using state-of-the-art technology. And by the way, one company today stated that they were the only ones with a U.L. approved cable alarm system. Gentlemen, that's just not so. U.L. has not approved any cable alarm systems. However, Gibralter is one of the few central monitoring stations in South Florida currently approved by Underwriters Laboratory. Let me emphasize a point. Home security can be achieved with various des of package success. We have developed for Cable Systems a home security p ge which will provide the most effective security system at the lowest possible cost. We proposed a basic package of intrusion contacts for two doors, two smoke detectors, and a panic button. The key aspect of our home security service will be the 24-hour monitoring by threalit experienced staff of Gibralter. And Gibralter is an aistito any vague currently serving thousands of South Floridians as opposed projections promised again here today. We have developed specific Our verification process procedures which have cut false alarms b9for verification, we estimate takes seconds. In studying TCI's proposal it would take at least 15 minutes. A final feature of our crime prevention package was developed in direct response from the Police and Fire Departments in the City of Miami. aecave committedment in nearcess lof $140,000 for these police projects, and $125,000 for the Fire Department. In summary, Cab Systems -Miami and I have proposed an effective, and we believe highly professional plan to assist you in the war against crime in the City of Miami. I'd like to thank you for your time and introduce you to Tom Gallagher. Mr. Tom Gallagher: Thank you, Rocky. Mr. Mayor and Commissioners, I'm Tom Gallagher. You have before you 5 applications to construct and operate a cable system here in our City. Trying to determine difficult hat makes the one proposal unique from the rest can be a very The applications begin to look the same after a while. They all have a great number of channels, they all have access facilities, and many levels of service. For the next few minutes, let us examine key areas of the proposals. Areas that will narrow the field and clearly show that .,,hick proposal, which company is best for Miami. These key areas we think are important to you are as follows:Universal service, home security, financial commitments to Miami, experience, commitments. The universal service is a package of public serv�y be the channels offered free of monthly charges. For some people, or i television only cable service affordable. Miami's own request 7 '1�%W Mel JUL 4b Mr. Gallagher (continued): proposals states on page 13, quote, "that such an offering free of monthly charges, and for the installation cost alone will be accorded a preference and will be considered a priority. The following compares the cost of the universal service. Remember that the City's request was for service free of monthly charges. Cable System service is free of all monthly charges and has a very small and reasonable installation charge. Only Cable Systems responded in the true spirit of the City's request. Now, let's look at home security. You've heard Rocky discuss home security and why Cable Systems has more experience. As you can see, Cable Systems offers the most effective system for the lowest cost. The remaining three areas are the most critical and crucial to Miami. Financial commitments, urban experience, and community commitments. Let us examine each. The financial commitment to Miami may be the single most important factor when all others are weighed. Today's economic conditions make this clear to cities all across the nation. And Miami, unfortunately, is no exception. We recognize this problem and are doing something about it. A prepayment of license fees for $2,500,000, no other company made any prepayment offer. Commissioner Plummer, you asked for specifics. $2,500,000 available to the City immediately upon the award of the license to Cable Systems. That's specific. $2,500,000 that you can do anything you wish with. In fact, that's a revenue source that could mean an additional 100 pclice officers out on the street protecting the community for one year. Clearly the proposal with the most outstanding benefits to Miami is Cable Systems. The real measure of an experience of building a large urban system is the operation of a system with a large subscriber base. Not necessarily simply miles of cable. Let's examine the two largest that offered proposals. As you can see, the subscriber base listed for both companies is nearly'•• but the number of systems is far from being even similar. There's only one company here this evening that can meet this criteria. As you have seen with an average system size of 52,000, and the largest single system in the world, only Cable Systems qualifies for substantial large system experience. Mr. Mayor, you asked about the specifics that will affect community participation, minority participation, arts and cultural participating, and they are as follows: I have compared again the two largest systems. These are the building blocks of community participation. This is where community program begins. You can see a pattern developing. And it continues. Mayor Ferre: You're going too fast. Mr. Gallagher: Again, you see which company has committed the most to guarantee participation by local arts and cultural organizations. I'd like to point out that our decision to commit a satellite up -link worth $1,100,000 administered by WPBT was in direct response to a request from Mr. George Dooley, President of VTBT. And we're the only applicant to have done so. And we have designated a staff producer exclusively Overour look arts channels. The last area is minority participation. at the last comparison, it's clear that Cable System again has the best proposal for Miami. We have more commitments for minority participation listed in the consultants report, more funds for minority invilvement programming projects, and $250,000 more for job training. Now, let me summarize. In universal service, our service has the lowest cost for installation and has no monthly charges of any kind. In home security experience we've shown we have far more experience behind our security offering. We also have the best price for the most service. We've shown we have far and above the most outstanding financial commitment to Miami. $2,500,000. We've shown we're the only company with a substantial large system experience. And community participation, one of the most important categories, again, our commitments to the community, the arts and cultural organizations and minorities is the most extensive, as shown by the many community endorsement you've heard here today. For these reasons alone, Cable Systems should be your choice. The facts are clear. Now I'd like to turn the podium over to Garth Reeves. 49 JUL 7 1981 10 E Mt, Garth Reeves: Mayor Ferre, members of the Commission. I'm here to tell you about a very special project called Miami Together. Miami Together is a $3,600,000 commitment to guarantee positive multi -cultural programming. Nearly $4,000,000 for community projects from the arts and special services. Miami Together is unique to our proposal in concept and in financial commitment. Other applicants talk of programming projects, but none comes near in committing the dollars needed to develop such a comprehensive project. This combination of dollars and professional staff will get our citizens working together, understanding one another, Black and White, Latin and non -Latin. The input of Raul, Tom, Eddie, Herbie, and myself, and that of our advisory boards, plus Cable Systems long and proven experience in multi -cultural community programming has resulted in a great insight into what role community television can play in bringing people together. Under the directorship of Dr. Manny Mendoza, emmy award winning producer of "Que Pasa U.S.A.?", Miami Together will take a unique and positive place in the households of Miami. The Miami Together Action group will be available to use in full spectrum of live and studio programming. Promote origination from anywhere in the City. Local production units in every neighborhood will generate material that can ease into group tensions and enhance an understanding of problems. Interactive television can provide talk back opportunities where people can express themselves by participating in the production process. Miami Together is something we believe in. In fact, our basic service tier is called Miami Together, and we have dedicated two channels expresely for this kind of programming, in English and in Spanish. We are the only company offering a translation center to produce bilingual programming. The satellite uplink located at WPBT will allow national exposure for Miami's multi -cultural programming. Mien I say our production facilities are available to minorities, I'd like to be specific. Our capital budget of $2,700,000 means, number one, a production studio for $250,000, up to 5,000 square feet at the Knight International Center. One in the new Coconut Grove Fire Training FAcility, one in the Little Havana Development Authority, and one in the Liberty City OIC. Our six community production centers cost $192,000 and they are located in Coconut Grove, Little Havana, Allapattah Community Center, Wynwood Center, Joe Caleb Center', and the Kinlock Park Recreation Building. We have a central playback facility and translation center located at the Knight Center that cost $600,000. Additional television equipment for the County Educational Center Facility is budgeted at $150,000 and the Digital Information Channel Input Units located at 50 locations cost more than $500,000. Now let's be specific because there has been some talk about numerous places. These places, 20 of them have been defined already, and I'll give you an idea where they will be installed. The Greater Miami Chamber of Commerce, the City of Miami Police, Information and Tourism, the Latin Chamber of Commerce, the Miami Fire Department, Miami International Airport, Dade County Department of Tourism, the Metro Transit Authority, Joe Caleb Center, the Greater Miami Council of Churches, Dade County Public School System, Wynwood Community Center, Allapattah Center, Little Havana Center, the University of Miami Knight Center, Miami Dade Community College, United Way, the Social Security Administration Office, Miami Employment Center, Citizens Crime Watch of Dade County, and 30 other additional units thar we will chose at a later date. We also have a mobile television unit for $115,000 and the satellite uplink at WPBT for $1,100,000. This equipment list is our solid commitment to insuring the facilities needed for minority programming. But equipment allocations do not guarantee community involvement. That's why we have Miami Together. Because you need commitments to the community above and beyond mere peices of hardware, and you need direct community involvement in the management of the system. That is precisely why we have 5 existing advisory boards. One of which is specifically for Miami Together, consisting of people like Bill Perry of NAACP, Eduardo Padron of SALAD, Clark Lamandola of United Way, and Frank McGraph of the National Council of Christians and Jews. They are aboard right now ready with Cable Systems to put Miami Together into operation. And we have many other minority programs which will act in concert with Miami Together. We are committed to three specific job training programs with technical positions. One to be taught at the OIC Center in Liberty City, one at Miami Dade downtown, and one in Little Havana. We are not competing with the existing programs by creating new ones. And we have backed up our commitment with $500,000. 50 JUL 71981 Mt, Reeves (continued): Gentlemen, my whole life in this ble Scommunity ystems was built around the concept of equal opportunity. if not share that commitment, I would not be a part of this group. I personally pledge that I will monitor our company's commitment to equal opportunity and affirmative action for minorities. And now, I'd like to introduce Raul Masvidal who will sum up our presentation. Thank you. Mr. Raul Masvidal: Mayor Ferre, Commissioners, if you think I'm going to stand here and submit you to a tirade on how I'm going to enrich myself over a franchise, I have no intention of spending any more time which has been very valuable, and I'm sure you ahve been very impressed by all these presentation. I am a local investor in Cable Systems -Miami. I htoe made my own personal decision without any knowledge from my p , turn over my investment to the City of Miami if the franchise is granted. My interest is 3%. And I commit here tonight, to all of you, that if Cable Systems -Miami is granted this franchise, Raul Masvidal will receive no monitary reward or no remuneration of any kind now or in the future, directly or indirectly. And I stand ready to request my own attorney, Mr. Richard Gerstein, who happens to be the president of one of our competing firms, to sit with the City Attorney and draft an agreement that will preclude me from doing that in the future. And let me tell you why I'm doing this. I think that this town has been playing the minor leagues for a long time now. I think that we should be ready to move to higher level. I think that we're not getting anywhere by listening to 25 presentations from some of the finest companies in the world, and some of the finest companies in the world are here ready to come into Miami. Some of the worst may be here too. Let me just say one more thing. I do believe, and I looked at this thing as a private investor, and now...I am a private citizen. I do believe that this company is the largest in the world and that Miami should be playing in the major leagues. And in making this selection, in selecting a franchisee, the most crucial process is sitting down and ° negotiating the contract. And when you sit down and negotiate, you go down ddoo or you go up. And you go against the best. And your going company in the world, which is the largest company intthe world. me And it's not the largest because they put together a proposal and sell it to you tonight. It's the largest because he has been doing this for a number of years. And it's a solid company, and it's backed by a number of years of experience and a number of citizens you can check. I do believe that it's about time that we quit playing games 's move seriously with toe qualitywork . And let'sof us. Wmove onetoathat. Thankcable nyounveirymmuch. and we do n p q ybody se ant Mayor Fer?e: otherat conclude volunteers?your Allpright,ahownmanynminuteslwaswto that, volunteer. Anyy for the record? Mrs. Hirai: A few minutes less. It was 32. Mr.. Blumberg: Mr. Mayor, could we save some of that time for rebuttal? Mayor Ferre: Yes, that's what I'm going to do for you. How many minutes did you say? Mrs. Hirai: 32 minutes. Mayor Ferre: How could it be 32 minutes when itwas in3030minuteminutes? presentation and the red light was supposed to go Mr. Ongie: We've been setting these at 35 ever since the first one? Mayor Ferre: Who told you to do that? Mr. Ongie: The first one took 35? Mayor Ferre: I didn't tell you to put it on 35. You put these on 30 and you record the time beyond that, so that we keep this equal for everybody. Now, the next speaker is Six -Star Nielson Cable -Vision. You have 30 minutes, and then we will decide who has gone over what, by how many minutes. Why 35? It could have been 38. You had two speakers at 38. 0 51 JUL 7 1981 Mayor Ferre: At this time, as I understand it; we've had two speakets at 38, one at 32, and one at 35. Is that correct? Mr. Ongie: Yes. Mayor Ferre: So there will be an additional minute...5 minutes. All right, ladies and gentlemen, Six Star -Nielson, is that the name of it? Six Star Nielson needs 5 minutes, so we'll reconvene here in 5 minutes. AT THIS POINT, THE CITY COMMISSION TOOK A BRIEF RECESS AND RECONVENED WITH ALL MEMBERS OF THE COMMISSION FOETID TO BE PRESENT. Mayor Ferre: All right, sir. Mr. Jack Sutton: Thank you. Mayor Ferre, honorable Commissioners, my name is .Tack Sutton. I reside at 5055 Collins Avenue in Miami Beach, Florida. I am the marketing representative for Six -Star Nielson Cable -Vision of Miami, Incorporated. It is my pleasure to introduce my colleague Mr. Don Robinson, of Covina, California, Six -Star Nielson Cable -Vision. Mr. Robinson. Mr. Don Robison: Thank you, Jack. Honorable Mayor, Commissioners, my name is Don Robinson, Vice -President of franchising for Six -Star Nielson. I'm not envious of your position here tonight. It's a tough, tough job. We're going to show you a tape on a very brief presentation that was prepared by 3 Calpoli Pomona students. They are on our on-the-job training program. They have a lot of hours into this tape. It's not a slick presentation. It was prepared in our Covina studios using public access equipment. We brought it today to show you an example of what can be done on public access, using students, and members of the community. The tape was prepared from a slide presentation, charts, tapes from vendors, and from a direct feed from our system in Covina. This should be your only example this evening of a presentation prepared by students that is not a slick presentation. The graphics portion of this programming following the video tape, the first video tape, was prepared by our computer student. He used our in-house computer and wired it in to our access equipment. We'll go ahead and show the tape now. AT THIS POINT, MR. ROBINSON, REPRESENTING SIX -STAR NEILSON CABLE -VISION, MADE AN AUDIO-VISUAL PRESENTATION BEFORE THE CITY COMMISSION). Mr. Robinson: The following tape is a sequence of rate charts comparing the other applicants with Six -Star Nielson's low rates. The first one has a rLt- increase by percent, followed by a rate increase by dollars, average cost per channels to the subscriber, highest penetrated tier rates. This again was done by a computer student, and it will continue on through the rest of the presentation so that you'll have plenty of time to view it, so that Mr. Pilnick will see the rates. I believe I have heard from you Commissioners today that you are concerned that your citizenry is best served. May I recommend a citizen advisory group from each interest in the City of Miami review the proposals and offer their evaluation to you in a qualitative and quantitative form. Secondly, we are willing to negotiate a contract agreement with the City competing againt the other 4 companies. Six-Star's management team has been in this industry or has experience in this industry that equals 300 years. Our president, Charles E. Smith, Jr., built the first cable system in Florida. We stand on the merits of our proposal and we back that up, and we will get into that in the comments section, with our technical consultant, Mr. Robert Cowart. In closing, I would like to thank Americable for providing you a more accurate summary of our proposal than did Mr. Pilnick and we ask that you look for practicality in the proposal, not just blue sky. Thank you. 0 0 7 0 .) ( i081 0 Mayor Ferre: All right. would you tell me, for the record, how marry minutes that was in that presentation? Mr. Ongie: It was 20 minutes. Mayor Ferre: All right, now. My conclusion...would you turn on the lights again? I assume that was your presentation, right? That that concluded your presentation? All right, that's what I thought. All right, now, the person who took the most, the group was 38 minutes. That, to be fair about this, that means that you would therefore have 18 minutes should you want that additional time. Then there would be, one of the firms would have 3 minutes, and one would have 6 minutes. Is that correct? Mr. Ongie: Yes. Mayor Ferre: Because one took 32. Would you read out who they are? Mr. Ongie: The first one took a total of 35 minutes, that was Telecommunication. Mayor Ferre: So they would have 3 more minutes. Mr. Ongie: The next one took 38 minutes, that was Americable. Mayor Ferre: So they have none. Mr. Ongie: Vision Cable of Miami took 38 minutes. Mayor Ferre: They have none. Mr. Ongie: Cable Systems of Miami took 32 minutes. Mayor Ferre: They have 6 minutes. Mr. Ongie: They have 6. And Six -Star Nielson took 20 minutes so they have... Mayor Ferre: 18. Mr. Ongie: ...18. Mayor Ferre: Okay. Now, are we ready to start? All right, now, let's see if we can get a concurrence of the members of the Commission to do the following. I would like to give each one of these 5 companies 10 minutes, or 15. What's the... does anybody object to 15 minutes in rebuttal? Anybody object to 15 minutes? 10? (INAUDIBLE BACKGROUND COMMENT PLACED OUTSIDE OF THE PUBLIC RECORD) Mayor Ferre: 15. Okay. Well, there's somebody here who wants 15. Does anybody object to 15? Anybody object to 15 minutes in rebuttal. Okay. Is that all right with you? Mr. Plummer: What are we going to do after that? Are we going to close it for the night? Mayor Ferre: I think after that we'll let you have your questions into the record, and then we'll get the heck out of here and come back on the 14th. Mr. Carollo: The whole thing is, Maurice, I don't know about you all, but, you know, it's 10:00 o'clock at night. We've been here for a good part of the day. I don't think any of us are at 100%. In fact, I even doubt if any of us are at 70 or 60%. And by the time another hour, when the gloves go off, start, something, we'll be operating something less than r �Odoof Mayor Ferre: Okay. Well, if we go 15 minutes by 5, that's an hour and a half. And then, Plummer, you've got half hour to ask your questions into the record. 53 JUL 7 1981 U z Mt. Plummer: I'll put my on the record. Mayor Ferre: Okay. Let's go. All right. The first 15 minutes goes to Vision Cable of Miami. Vision Cable. All right, you've got 15 minutes, And we did it by drawing these numbers previously. You want to put the machine on? Mr. Michael Willner: My name is Michael Willner. I'm the fewPresident of minutes to go Vision Cable of Miami. And I would like to spend just over a couple of specific points that I feel that each of the 5 of you may want to make some of your own determinations. I'd like to comment that TMC's evaluation, 13 volumes of information that was submitted was indeed a task, and it was done very successfully, and I would like to offer to you only two suggestions of changes in the rating of Vision Cable of Miami, based on what we feel are more pertinent facts to determine whether or not a weakness or a strength should have been awarded to Vision Cable in two separate issues. Let me preface by saying that long before we developed our proposal, Vision Cable purchased a number of weeks worth of advertising in the Miami Herald and the Miami News to try to determine directly from the residents of Miami what types of services were important to them. We succeeded in receiving over 1,000 responses to that survey. We felt it was the fairest way to ascertain the needs of Miami because the people themselves directly were responding. And copies of those ads are here. t we You may have seen onsestinmourBut Lhis is possession ifaanybodydcaresito•seend we tstill hem, have the resp Mayor Ferre: How many responded. Mr. Willner: About 1,000. I think we had a lot more phone calls at our office. We found out that there were 2 items in that survey which were of utmost importance to the people of Miami. In fact, 94% of the people that responded that wanted cable television said that two items were either very important or important. And those two items were number 1 on our survey. That was clear reception on the local t.v. signals. And number 16 on our survey, they wanted commercial free movies. Based on that, we developed a proposal which was responsive at an inexpensive rate, for the most people of Miami to receive those two major services, among all the other services. But those two we found far and above the most important services the people here in Miami. This one is a little harder to read. We took it right out of our response to Mr. .Piibers,s report. But let me explain it to you. It's four typical it's titled. Those four typical subscribers are based on two maps. Number one, what we found out from our survey were the needs of the people in Miami, and number two, what our experience in similar major markets around the country. Suburban New York, suburban Tampa, other urban markets. Suburban Charlotte. And found that the service which everybody felt was number one was their peoplrecpte in, by far the lease expensive with Vision Cable. For those people in this Vision City that cannot afford the monthly charges of cable television, is the only applicant offering the very important reception of channels 2, 4, 6, 7, 10, 17, 23, all the locals must carry signals absolutely free of charge, -n monthly fee. Making cable television clearly universally available needoof rooftoppeople ia tennas which willMiami. it is the only service that will replace the eventually get blown down in a windstorm or a hurricane, and need to be replaced. In addition to that, we have 3 different levels of subscribers all of which take at least one paid televisionoflevel. teBeciu e e Vision again, that 94% of the people take one level p aidclearly paired up along with Cable Systems and TCI as the least expense buy for 94% of the subscribers. The real number is that in Clearwater 98% take at least one level of paid television of first rung moves,ht and 97% in our system in Burton County, New Jersey, which ide of New York City, we find that 80 subscribers here in Miami monthly fees that if 94% of the people are going to take at least one level of pay, we should have clearly been awarded the same number of strengths for rates as TCI and Cable Systems. And we're asking the Commission to reevaluate the weakness that we received because of basic rates in which only 6% of the people were interested in that service, and give us the same number of strengths as TCI and Cable Vision, which is 3 strengths. 54 IUD r ��� Mr. Willner (continued): The second area of contention we have with the report. I reiterate that it was indeed a very comprehensive report, was in the area called Percent of Budget Allocated Towards Public Access. You'll find public access in all of our market areas of extreme importance not only to the City Commission during franchising, but in on -going operations. And we allocated only 30% of our total operating local originating budget as public access. It was the second lowest percentage. And we received a weakness for that. We started out from by far the highest budget. So in fact, TCI which had a public access budget of $975,000,000 received a strength, and Americable received a strength for I believe it was a 50% public access budget for local origination. But Americable only had 1/2 the total budget. And we've all been talking about the dollar of commitment tonight, and I contend that Vision did not deserve a weakness in the Percentage of Budget Allocated Towards Public Acces, because it fact, it's the second highest number of dollars being spent from the very highest budget. And I repeat one other point, from the very highest commitment, personnel in our local originating facility. Nearly twice as high as any other applicant. Mr. Carollo: Mr. Mayor, can the consultant answer that when he's done? Mayor Ferre: Will the consultant make a note, please, of that so that that can be answered. Not at this time, sir. Just make a note. Go ahead. Mr. Willner: At this time, I would like to ask you to listen once again to Sid Knafel, the chairman of the board of Vision Cable of Miami, and we'll be concluding our statements with him. Mr. Knafel: When I spoke to you earlier, I discussed and gave examples of our community involvement and stated it was a deeply felt tradition. Where does it come from? On one hand, it comes from Vision Cable Communications which was built by this management as the outstanding growth company of the cable communications industry. The company was moved 50% -a-year over a 10 year span. This is a growth which came from service to fulfillment a growth which came from innovation. The first operating commercial total security system some years. aeo. The first cable to install the Dow -Jones taro -way data retreival system both in Clearwater and New Jersey. We're the first people to make the 54 channel proposal nearly two years ago. A dedication to service and innovation which is now available to Miami. And on the other hand, our tradition comes with the NewHouse organization A 50 year old company based on community service which has built up the second largest newspaper chain in the country, the 8th largest cable operation in the country. It has successful radio stations, the publisher of well known maganizes, Glamour, Mademoiselle, House and Garden. And Random House Book Publishing concern. Together we have a track record second to none. And a financial position of over $1,000,000,000 of net worth. There have been requests for dollars to be discussed this evening, and I earlier pointed out some specific commitments which totaled $40,000,000. Acutally, over a 15 year period we will invest over $90,000,000 in total. And that's cur plan as of now. If inflation continues, I'm afraid that figure will be increasing. Gentlemen, it was said before, but I ask you to consider it now, that the decision you're going to make for your City is the most significant vote that you're going to be making sitting in those chairs. It is a consideration of the communications network to serve Miami for 15 years and a real practical probability, for many years thereafter. It is a decision that cannot be based on promise, it is a decision that has to be based on performance and proven facts. Some small examples: Athalie Range told me that a tri-ethnic Miami is restless unless its three groups are deeply involved. So we asked her to be involved. And she saw that we were genuinely tri-ethnic and she joined Vision Cable. Carrie Meek told me she wants to train the young people of Miami to have jobs. Not only this city, but throughout the state. I told here we were committing $2,500,000 to train t1:_^,, and she joined Vision Cable. Armando Codina told me -[hat he 55 JUL 7 1981 Wasn't interested in entertainment. He doesn't like television, but he is interested in the cable sytem which will deliver information to this Country's fastest growing commercial city and he joined Vision Cable. But Anne Meyers really summed it up. She told me that she did not want an operation where something goes wrong. She doesn't want to be involved with at problem. She doesn't want to be involved where it doesn't work. She joined Vision Cable. I think if you gentlemen investigate our background, our reputation and there will be many who haven't and do it as thoroughly as your local citizens who have come and joined us, you too, will join Vision Cable. Thank you, very much. Mayor Ferre: Alright, how much time was that please? Mr. Ongie: Eleven minutes. Mayor Ferre: Alright, so they have four more minutes accumulating... did they have any other time before? I just want to... Mr. Ongie: No, they do not have any other time. Mayor Ferre: Ok, I just want to keep this on an even keel if somebody else wants to claim that extra time as we go around in the future. We may not do it tonight, but I want to keep that on an even keel. Alright, the next... Mr.... Joe do you want the answers now or do you want them after... I think if we interrupt the flow of this... Mr. Carollo: Yes, if he would just make a note of that and come back to us at a later time and reply to that. Mayor Ferre: The next presentation is Miami Telecommunications. Mr. Paul Malden: Mayor Ferre and members of the City Commission, my name is Paul Malden. I am Vice -President of Telecommuications Incorporated. I reside in Denver, Colorado. Well, it's all occurred exactly as Mr. Gerstein predicted it would when we were first up early this afternoon. Claims, counterclaims and so on. Cable and cable franchising is a highly confusing, complexed, technical subject. That's why cities employ consultants, because it is all of the above. Consultants is supposed to sit and sort and come up with evaluations. All you have heard tonight was part and parcel of the consultant's evaluation, both in the original submissions and in the very lengthy rebuttal process, the written rebuttal process that is, where every company had the opportunity to in full details in writing rebut to Pilnick's findings. But one fact remains, after all the rhetoric is over with Miami Telecommunications still winds up with more strengths and fewer weaknesses than any other applicant. Let me point out a few specifics, however, that I'm afraid are part of the whole confusing process. I want to point out first, that we have great admiration and respect for most of our peers in this business. Somebody here said we have tonight some of the finest cable systems in the world here and perhaps some of the worst, that's very true. Let me point out just a few implausible, if you will, problems that I have observed. Let's talk about an up link that our colleagues in Cablesystems were proud of. They claim they are the only one, that's not true. We also proposed an up link, but there was a major difference. We proposed ours in year one. We did proposed an up link. We also proposed an arts channel, -:.ay were not the only ones. They said the; tiave the only large system experience or more large system experience and they showed our very large number of cable systems. That's true. We operate... in fact the number is now over six hundred just since they made those slides. We operate the second largest cable system in the United States, with a hundred forty-eight thousand subscribers served from a single head end in the Pittsburgh suburb. Community endorsements, we chose not to load the council chamber today. We could have invited lots of folks. We interviewed over eleven hundred people during our process. We chose not to have them come because we have seen it back fire in other situations. Our proposal has about fifty letters in it of the same types of endorsements. The U.L. situation that Mr. Pomerance referred to, he is correct as far as he went. He is not correct. tie neeu5 to read our proposal again. We weren't referring to the equipment, all the er:i,4n ono- Tokam, Pioneer,.. (inaudible).. and the rest of it, of course, it's U.L. approved. We are talking about a system of a private guard going out to investigate the call and that is a requirement not only of the Miami Police Force, but of U.L. and we did propose that. Let's talk about the universal tier. The slide again, was inaccurate. It's a totally different gl C J t 7 i Z.$ ra item. There is a cross subsidy involved in what Cablesystems were proposing in theirs not in ours. We are charging for the convertor so that those who are paying for the higher tiers of service don't subsidize those on the free tier of service. Let's address the institutional network. Mr. Pilnick is a proclaimed expert in the country on institutional networks. I know. I ran up against him in other cities on this very subject. The Canadians would have you believe that it's proper to have an institutional network combined with the home subscriber network. We don't agree and I don't think the consultant does either. Why, for example, are the Canadians construction cost the lowest of all? By the time we reach year four, except for Americable Ana I can go on. Let me talk about Americable for a moment. We are very intrigued by the site that Mr. Hermanousky talked about. He is right, that site coordinates. But I want you to know that included in our proposal were photograph of the people and the equipment. We actually brought earth stations into the City along with single strength meters, field testing equipment and we measured on every single one of our four HUB sites and gentlemen they do coordinate and they are so confirmed in our proposal and any engineer in the country who knows what he is talking about will confirm that those sites do coordinate. I could go on, there is more, there is no point in it. The fact is that after all of this we still have more strengths and fewer weaknesEes. One last thing that I want to point out and our friends from the North have to bear this out, but I must point something out. We in the U. S. are not permitted to do business in Canada. I still have to voice my objection to the folks North of the border being permitted to do business here when we are not permitted to do business in Canada. We ask for nothing more than reciprocity. I will leave that subject on that. There is two other things that I need to talk about. On of the applicants discussed TCI's lawsuits and some allegations that we have unbuilt systems. I don't want to get into name calling, I will remain... I will try to be more dignified than that. We have no unbuilt systems. We are in business to build systems. Yes, we have a few systems that were late in being completed. In the early 70's every cable company in this business had systems that were late being completed. And they were right though, a couple of those systems are not complete today and that's correct because we are still building new development in those cities as they come up. It's patently absurd what they said and we would be happy to document that. Lawsuits, I can only say that we are not getting into a numbers game with the Canadian company. We are the two largest cable companies in the world. We now operate over six hundred systems. We have two lawsuits that go along with those six hundred systems. The fact of the matter is, that TCI has specialized over the last three years of buying sick systems and making them well again. When you buy sick systems, the reason they are for sale is because they have lawsuits, they have broken promises and they have problems and we have inherited those problems. I would like to turn some time over to Mr. Dan Paul. Mr. Dan Paul: Mr. Mayor and members of the Commission, it's late and I want to leave some time so I can get an assignment from Mr. Masvidal of his stock before I go home tonight. Maybe I can get it assigned for benefits that they want. Since he doesn't want it we might as well hedge our bets. There is one little comment I did want to make in reference to Americable's presentation and that relates... you know, to live in glass houses ordinarily you don't throw stones and I don't know that it would be worth digging in the bottom of the pile to answer that kind of presentation, but I think you might judge the whoit accuracy of the presentation just by askin- your staff to check Americable's record in Dade County and particular in two areas, financing difficulties in putting in the Dade County system and the lack of compliance with construction standards. And also, on Americable's promises about the quality of their system. Ask them why they are constructing the system now in Dade County that isn't up to the state of the art. There is no two way capability. Promises, performance is what we are talking about. I think Miami Telecommuications would be blushed to be constructing such an antiquated system in this day and age. One thing though, we do agree with Americable on. No one else is offering free installation for forty-five days. We are offering it for sixty. I think you have now reached the point where you have got to analyze and strain through all the complexities and the opinions and claims and decide which cable t.v. applicant is qualified to best serve the needs of the people of Miami. I only want to leave you with a few facts to think about at this late hour. Fact one, Miami Telecommunications and its affiliated group is one of the two largest and most experienced cable operators in the entire cable industry. Fact two, Miami Telecommunications is the strongest financially of all the applicants. Fact three, our group will construct more miles in 1981 and 1982 than all the other applicants here tonight combined. Fact four, Miami Telecommunications received the highest 91 3'7 JUL 7 1981 it 4 Appraisal by the City's consultant. Fact five, Miami Telecommunications is the only applicant to guarantee a local voice and ultimate loc,l control in the management of the cable system. Lastly, remember Miami Telecommunications has presented the proposal with the most strengths and the fewest weaknesses. I think to this point you have gone about the selection process in the most professional way by hiring one of the best professionals in the business to advise you. You sent out the message early on that politics didn't play well on the two. In making the decision you have to represent the most important group that has not made a formal presentation here tonight to the public. In this matter you are the public's conscience and the public as you know, is interested in one thing, who is going to give them the best serve and the best value at the best price. I think as you make this important decision all we ask is that you continue to approach it in the same professional way that you have led the way to this point. The eyes of the entire city are on you. A decision based on strengths and weaknesses of the applicants will be above criticism by anyone. Thank you, for listening to our presentation. Mr. Ongie: Twelve minutes used and they had three from before. Mayor Ferre: Alright, let's move along now. The next presentation is Sixstar Neilson Cable Vision of Miami. Are they here? UNIDENTIFIED SPEAKER: Honorable Mayor and Commissioners, your friends at Sixstar Neilson Cable Vision would not like to get into a battle with the rest of these companies. We will wait for the question and answer period. Mayor Ferre: Thank you, sir. Alright, the next fifteen minute rebuttal point is Americable of Greater Miami. (BACKGROUND COM2•1ENTS OFF THE PUBLIC RECORD) Mr. Ken Meyers: Mr. Mayor and members of the Commission, we want to clarify first of all, our application on minority programming and local access channels. There seems to have been a slight confusion with respect to that in the consultant's report. We want to apologize if our application was unclear of this in some respect. We were professional cable operator, we are not professional application writers, but... and we didn't list local origination programming a second time in our application as minority programming, but here is the list of local and minority programming Americable offers the City of Miami which is in those applications, although, disbursed throughout the appliation. Twenty-six local origination channels, Spanish, Black, Jewish, Triethnic channels and studios, four triethnic studios. Spanish job... Miami job opportunity channels, Spanish twenty-four hour new channels, Spanish public access channels, Spanish Miami community bulletin board channels, Spanish cable t.v. programs channel, Library local origination, Dade County Schools, emergency operation center, City of Miami community bulletin board, University of Miami local origination channel, Miami job opportunities local channel, Sunshine State network, tourist guide, cable t.v. programs, English channels, Florida International University local channel, Little Havana community access channel, Allapattah community access channel, Manor Park community access channel, Little River community access channel, Coconut Grove community access channel, Flagamy community access channel and so on down the line. Twenty-six local access channels when we were only credited with two. So, that we believe that, that should have been a strength along with all the other applicants and not designated as the consultant did initially. We have as much, if not more, as any of the applicants in this very important area. Now, on the question that Dan Paul raised in a quick shot when he was up regarding Americable's record in Dade County. Well, I don't know about what he has read or saw, but I saw the Miami News summary on July 4th in which they listed all the applicants and it summarizes some of the past histories of some of the applicants and in Americable's it quote Bob Gringle who until recently was the County's cable t.v. coordinator and now head of the Zoning Department for the County and he says Americable is doing a good job in Dade County in construction. So, I don't quite understand his comments. Now, as to financialy capability on equity, we want to clear another item in the consultants comments. The consultant indicated, rightly so, that Mr. F7nr-.-.+-.•.�L�, did not list in his additional applicant and that was a mistake, his equity position and therefore, it's shown as a technical weakness as against the others. Mr. Hermanowsky apologizes for that and corrected it by filing his network statement, which incidentally shows over twenty million dollars which he has personally committed to this Miami system. Mr. Pilnick, gl 58 JUL 7 1981 it 0 ,when he got up indicated that Mr. Hermanousky did correct it, but he didn't tell you what the equity position of Mr. Hermanousky was. We would like to show you that and indicate that, that is a strength. Now, on the question of payments for local programming that many of the applicants put into their applications. I have indicated a strength for doing so in minority programming. Sure, it's easy gentlemen to say in an application that you are going to give the City five hundred thousand dollars for local programming or a million dollars or two and a half million dollars in advance fees like one of the applicants did. It's easy to do that when you are projecting to take to New York for instance, a one hundred forty-five million dollar profit over the fifteen year franchise like Vision projects in its own application or when you will take out of Florida to California in managements fee ten million fifty-seven thousand and ninety-eight million dollars in profits as Sixstar proposes to do over the next fifteen years. Or when you are taking out of Florida to Denver twenty-seven million dollars in management fees as Telecommunications proposes and a hundred thirty-eight million dollars in profits as they propose to do in their application or when you are taking out of Florida to Canada nine million six hundred eighty-six thousand dollars in management fees like Cablesystems proposes to do and one hundred million dollars, one hundred million seven hundred thousand dollars in profits like they propose to do. on the other hand Americable's management fee over fifteen years is three hundred thirty-three thousand dollars which goes to its Miami headquarters. Now, on the question of local citizens attached to these applications. I want to say gentlemen, and I think that everybody in this room knows that I have the greatest amount of respect and admiration for Athalie Range, for Carrie Meek, for Dick Gerstein, for Barry Kuten and Hank Green and Meyer .nd all the other persons who have been attached to these applications as local citizen and I... one thing I said was intended to indicate otherwise, that the fact remains that the only applicant before you now that is truly home based is Americable and the fact still remains that the obvious rationale, the obvious rationale of these essentially out of state and in some instances foreign companies is their rationale in attaching local investors was stated by themselves. I'm quoting from the Miami News. TCI, quoting Paul Halden, the Vice -President of TCI Taft. "We didn't know the community" said Faul, the Vice -President of TCI Taft. "We need advise to localize the proposal, to localize the proposal. We try not to get involved in politics". Now, Vision, what they said. Michael Milner, Vice -President of Vision Cable said "It helps to have local input so the community can be responsive to the needs of the community. Sitting here in New York, we can't respond. Sitting here in New York, we can't respond". That's Vision's statement themselves. So, I without any... casting any dispersions on these people who have attached themselves to these applications, I think I was attacking and I think you understand that, the motivations of these essentially foreign and out of state applicants in affiliating these people to them. I think when all the dust is settled and you look at these proposals and you review again the indication of the consultant that all of these applicants will do a good job and that they all capable of doing the job, that what you will do is ask yourselves a question, what's best for Miami?, where is the money going to go in the huge profits that are going to be made in this franchise?, and who is truly the person with a local track record, the local experience, local performance, local capabilities who truly calls Miami its home and I think you will come up with the right answer. Mr. Carollo: So far this is better than anything I want to see in November. Mayor Ferre: What was the timing of thatr Mr. Ongie: He used nine minutes. Mayor Ferre: Nine minutes. Senator, you got some extra time coming later on. Just wanted you to know that. Alright, we have Cablesystems of Miami is last fifteen minute rebuttal presentation. Mr. Lynn: Honorable Mayor and members of the Commission, I just wanted to clarify one or two points if I could. First, I would like to salute Senator Meyers. I think that one certainly enjoys the report and and I think he is doing a superb job for his client. I would like to just reiterate that to Mr, Plummer, that we have .......civic amendments in the so-called ..........that Carl Pilnick mentioned earlier (remainder of statement inaudible. ....show that I think that we can do it in two years. He talked of the importance of the system size and of experience in these complex systems, we have showed, I think our depth in this area. He talked of the up links. It's true Mr. Halden mentioned that ours is in year two. The reason we put it in year two was we are gl 59 JUL 7 ?)31 ir C convinced from our experience, for instance, it takes at least a year to get that machined licensed and we thought it would be prudent to list them in year two, that it would be reasonably ........ I was frankly, just a bit surprised of the comments of Mr. Halden of TCI regarding the Canadian issue. His vartner Taft Broadcasting proudly mentioned tonight, this afternoon a new investment that his company had made of over a hundred million dollars in Toronto and I frankly think it's a terrific project. We are delighted to have and I am pleased, I really am, they have chosen to invest in Toronto. But I surely... I can't see how he is going to object to our now wanting to invest in Miami. Maybe Tom Alexander... Tom Gallagher, Representative Gallagher will have a comment or two on that. Mr. Tom Gallagher: I guess... and it's really not fair for the Canadians to have to justify being Canadian, but I will say this that I was very instrumental in going to Toronto after checking and looking into many, many systems and many, many people that operate those systems and getting them to come down here. It took about four months to get them to finally commit to come and to be involved in this City of Miami, because we really believe that's the best system. We believe that they are the best system operators in the world and that's why we went to there and brought them down here. So, I guess I really wouldn't want them to have to sit and try to justify that. It's our fault, if it is a fault. Mr. Lynn: We don't think it is their fault. We are very pleased to be here. Finally, we would like to take just a bit about the institutional trunk issues. It's one that's being flogged a bit today and we would like to deal with the system a little more and I would like to ask Robert , he is our Vice -President of operations and he would be responsible for building this system to comment briefly on that. Mr. Robert Thank you, Bill. It is appropriate that we comment on this item because perhaps as I think you heard last Friday, if it wasn't for the difference of opinion that we have with your fine consultant we would probably be standing before you as the first ranked company. We do have a difference of opinion and I think it's healthy to have a difference of opinion, but I would like to share with you why we think we are right. As Mr, Pilnick pointed out, the institutional system is a business just as the cable side is a business, interactivity is a business. These are businesses and we know about that, because I don't think this has been said before, but we operate institutional systems. I'm not quite sure who else does, but I think we know something about them, because we do. We transmit data, we transmit video, we transmit info taps. So, one of the things that we have learned is that it's extremely important as to who we can market those products to, because we talked about cross sudsidization tonight and at other time. I don't think we want the cable subcribers to be cross subsidizing the institutional users and so by proposing an integrated system we are able to place every home, every business, every public service institution in this City in front of the institutional service. It's a larger market place. It's more people than we can market and service too and make it work. I might quote from Mr. Pilnick's report also. Page 31 of his report he talked about the dollars. Let me summarize, 2.986 million dollars institutional commitment, Cablesystems. Americable, eight hundred thousand. TCI, eight hundred thousand, Sixstar, Six hundred eighty-five thousand, Vision, less than seven hundred thousand. Let me say it again, Cablesystems, 2.98 million dollars, page 31. We are surprised that overall we were not ranked higher. It is an integrated system and there are other consultants who feel differently about it. , might just quote another advantage from the cable television information centers report at Saint Paul "An advantage of the intergraded network over the network using the dedicated institutional cable is the channels can easily be reallocated for other uses". So, very simply, I think we have a difference of opinion. A difference of opinion which has unfortunately penalized us from ranking one which we firmly believe in is one that will be successful in Miami. Mayor Ferre: I want Mr. Pilnick, a further discussion on this issue when we get to the... Mr. Tocn Gallagher: This is an important decision for you and we urge you to once again, to consider the following; First, urban experience, a must and Cablesystems of Miami has the second state of the art system. Cablesystems of Miami has the know how to build sophisticated two-way planning. Third, home security, a proven superior. system. Fourth, financial strength, a hard bank letter and the backing of Roger's Cablesystems. The world's largest cable company. Fifth, final-Icial help to the City now. I4ow, when it needs extra help 2.5 million dollars. Sixth, the minority commitments, second to none. And gl 60 JUL 7 1981 0 seventh, Miami together community programming initiatives advise report. Finally, Mr. Mayor and members of the Commission, I would like to salute you on behalf of, I'm sure of all the cable companies here, on the way in which these hearings areI think wedallefeellwe havewhadldecent hearingshandatherwhole fair shake here. re process being conduct ed1 ofhtheecableecompanies whest of the n Itsay, hank you,Ivery umuch. I speak on behalf of al t concludes.... would you tell us the time into Mayor Ferre: Alright, now, tha the record? Mr. Ongie: Seven minutes used and they have six minutes from before. Mayor Ferre: Seven minutes used? Mr. Ongie: Yes, sir. Mayor Ferre: Alright, now, before we breakup today I want you to annouce what the accumulated extra time thItthinkthese wedifferent going tocompanies selectare alsolnantorder have, because at the next meeting intention for whatever final presentations might be forthcoming makeup that my time if they to give those who have spoken less the opportunity ours, sir, for so desired at the last meeting. Now, Mr. Plummer, the floor is y questions. t I art Mr. Plummer: Mr. Mayor, I think it's one which Inly fair brought upabeforelandtreallytinwhat factI think is the most important I will abide by the Commission's decision. I would like if it's in the form o a motion or however iis� Mho Mayor, I determinetinnthosesareasrofnt-tfromt113 on Commission, if possible,L7' Dir. Mayor. It is my feeling that we need to be relates to the City needs, umber of cases. I think that it is more specific in this area in a great n ve lawsuits in the future, that we necessary that if we are not going to ha in people down to dollar figures, that make those determinations now, that we p we pin them down to a time table so that we can measure these, one company t's moti against another and Mr. Mayon or how you want r, l ,Idosonallyknowfeellthatait iso important. And... to handle that Mr. Mlayor, P but I will abide by the Commission's ruling, of course. Mayor Ferre: Alright, Mr. Lacasa, Father Gibson, Commissioner Plummer has posed a question which has oughttogetsomeoffarstatementwe get tfroCommisrsattorney. input on this, I think we o g don't you restate the question in brief Alright, the question... J. L., why form? Mr, plummer; Mr. Lacasa and Father, did you hear what I said before? Rev. Gibson: Go right on. Mr. Plummer: Ok. Armando, on the relation to City needs, in my estimation it is very general. It is not specific. You have seen and I have seen that in the past of where you get yourself into real kinds of problems isa Team you don't pinpoint and you leave things in very broad terminology is concerned for some of the broad terminology here. I think wiat'ntsneed dollars some way shape or form is to pinpoint it down to wit.hat it rep and a time table as to when they w, I haveos se t before I willWe nabideow eby they are m a o do fifteen year time frame. Commission's majority thinking. Mayor Ferre: Alright, Mr. City Attorney, you heard the question, let me uestion that I would like an opinion from you on. As we all pose the legal q Applicants and know cable applications are fraught with lawsuits of unsuccessful successful applicants, etc., etc. The concern that I would have is that a delineation of the questions posed by Plummer about more specificity could leave us open for the claim that we open it up for changes by delineation. Secondly, it also, my question to you is for you to cover also, the possibility of the legal challenge that could come by saying that it was not fair because in some cases where there are blanks that would in a way preclude, in other words, what's the difference between leaving he somethifiing cations blank and leaving something vague of those two general areas. And lastly, I would like to ask you if there is a way that we can legally satisfy what Commiioner Plummer do that ssquestions. in your opinion would be legally safe. So, those are three gl JUL 71981 0 Mri, Knox: I think it is pertinent in response to that question, is to read into the record a portion of the request for proposals which relates to amendments to applications and that provision in the request for proposals indicates that "Substantive amendments to proposals will not be considered except to acknowledge involuntary changes such as the change in ownership due to death. Correction of inadvertent errors submitted prior to the filing deadline will be considered. Correction of errors submitted after the filing date maybe considered at the discretion of the City or its consultant. If the applicant submit with it's correction sufficient information to prove that the error is inadvertent"and probably the most significant portion of that provision in a case that "Additional information or data maybe requested by the City or its consultant if in their judgement this would aid in preparing a fair and accurate analysis". So in order to answer the question there would have to be a determination made by the City Commission or the consultant that additional information of a nature which would clarify information which has already been submitted to the City Commission if the City Commission determines that this information is necessary in order to prepare a fair and accurate analysis of the proposal. Mr. Plummer: Did I win or lose? Mayor Ferre: Could we ask the assistant City Attorney to give us a legal opinion on the City Attorney's interpretation? Mr. Plummer: It's fair and accurate, he said .•• Mayor Ferre: Oh, I see. Well, that clarifies it. Plummer, it falls in your court. Mr. Plummer: Well, I don't know where I stand. Are you saying that I can ask for such or you saying I... Look, I'm not asking them to change anything. I would be very much opposed to them changing anything. An error is an error. I don't say this is an error. I am merely saying that in areas that is very broad and without dollars or time tables that there needs to be a clarification. Now, either the rest of the Commissioners agree with me or they don't. And you know,.... Mayor Ferre: Well, but I think that, you know, you are asking.... I always speak for myself. Obviously, you are asking me whether I agree with you. It depends on the legal ramifications. And the. City Attorney tells me that we are treading on dangerous grounds and that's thin ice, then I don't agree with you. If the City Attorney tells me that he thinks that, that something that has some risk, but he in his opinion... and obviously, it's a guess on his part, because, you know, lawyer make believe that it's all science, but it isn't, half of it is guess work, but I have got to be guided by his guess work at this point. And if he tells me that he thinks that we can safely do that, then Plummer, I would go along with you. I mean, that's my personal opinion. Mr. Knox: Alright, I will try to say it in English this time. Mayor Ferre: We will recognize the applicants who may want to have input into this and Plummer asked previously whether or not they would voluntarily. We might get it that way, I don't know. Let's go for the City Attorney. Mr. Knox: Alright, we can take a sample statement which has been submittea ;Dy a company that there will be community origination points at numerous minority organizations. If the City Commission feels that, that statement needs to be clarified with some specificity then the City Commission can elicit that information. That is not to say that anything new maybe added by any of the applicants. If there is a statement which has been submitted to the City Commission that the City Commission or the consultant feels is necessary to be made more specific or to clarify in order that it may make a fair and accurate assessment, then having made that finding it would appear that those kinds of questions could be answered. Mr. Plummer: Then let me ask Mr. Pilnick. Mr. Pilnick, do you feel that it would be helpful to me or to members of this Commission to have that additional information? Mr. Pilnick: Commissioner Plummer, I think it would be helpful, but I still would suggest against it for a couple of reasons. I think that many of the statements that are ambiguous are intentionally ambiguous. The companies, again, had several months to prepare their proposals. Most of them have been submitting I gl 62 JUL 7 proposals for years to various cities. Some of these questions have come up before in other cities, the question of clarification. I think in many cases it's an attempt to have it both ways. It's an attempt on the company's part to seem to be offering as many things as possible without being backed into a corner prematurely on the question of how much it will cost, when it will be provided and what happens if it's not provided. So, that I don't think we are talking about errors. I think we are talking about a choice that the companies have made in using the wording that they did use and I think that if you allow them to open it up, what you are doing is... the cards are now all on the table. Every competitor knows every other competitor's bid and if a competitor feels that it maybe in third place or second place it's going to push. It's going to push a little bit on it's responses to your questions. So, that I think I understand what you are saying and I think you are right. I think you... the City deserves to have specific responses, but I think in many cases these proposals are written this way. Mr. Plummer: Can it be done in negotiation? Mr. Pilnick: I think it can be done in negotiation and most easily done if you select one company to negotiate with. I think if you are talking about simultaneous negotiations with more than one company you are in the same problem again. Mayor Ferre: J. L., may I interrupt your series of questions? Mr. Pilnick, don't go because this is in that line that Mr. Plummer, who has the floor is asking. I would be concerned if this Commission chooses "X" company and you get into negotiations, that you would include in the negotiations things that "X" company did not completely include, but that company "y, Z and A" included and then allow them to expand and I think that is even worse. Mr. Pilnick: Well, the City has a choice in that respect, Mr. mayor'... Mayor Ferre: You see, in other words,... excuse me. What I'm trying to say is that Plummer may be right, that I would rather have that kind of goings on up front ahead rather than this Commission select and then in the negotiations you do it, which is what you kind of implied when we discussed this, saying that you know, you can always be more specific and that I would not want that specificity in the negotiation process with the selected company to be expanded beyond the scope of what that particular company has said it will do or did not say. And if the company has left that area blank, I don't want you in your negotiations coming back and filling it. Mr. Plummer: Mr. Mayor, let me make my point clear. I would be very opposed to any company having the right to expand upon their bid. That's not the point at all, to neither delete nor expand. I am saying to clarify. That's all I am saying. Mr. Pilnick: Commissioner Plummer, if you just take one specific example as I indicated before of the three communications vans for the Police Department. If a company wishes to make it's maximum effort towards being upgraded in your estimation, it originally might have budgeted fifty thousand dollars each for those vans, if you now ask them to give you a price on those vans they may put a quarter of a million dollars each for those vans, which does increase their commitment, obviously, but it also, in my opinion is the effect of them .,:.'^raging their original intent. And with respect to what Mayor Ferre said, I think that the City does have a choice once you go into negotiations with a particular company of deciding whether all you want to do is clarify and put specific amounts on what that company has proposed or whether you want to open new areas. But I think the basic question comes down to, in my opinion, I believe you have to make your decision on the way you evaluate the proposals right now. Mr. Plummer: Alright, so then to sum the substance of it is to leave it alone. Mr. Pilnick: I would suggest that, sir. Mr. Plummer: Alright, Mr. Pilnick, most of these questions I want to ask of ^u so I am not being bias. We heard from one company the up front, initial amount of money they would give to the City. I was most adamant when we were preparing the RFP that all companies be made mandatory to give an annual minimum guarantee. How many of the other companies have given an annual minimum guarantee for the duration of this fifteen years? gl 63 JUL 7 1981 Mt. Vilnick: I don't believe the other companies specified, but I just would like to perhaps correct one comment. You talked about a gift, an up front gift. This is not a gift, this is a loan. This is an advance of future franchise fees. If the company pays it now, it doesn't pay it later. If you use the money for an operating commitment, such as hiring more policemen as was mentioned, then next year you have got to dig into your own pockets to keep the policemen going. so, that I'm not saying it's bad necessarily. I'm saying that you have to understand it for what it is. It is a prepayment of franchise fees that would be due later. Mr. Plummer: well, how much of it... Rev. Gibson: Isn't it also true, isn't it also true... let's put this on the table. Isn't it also true that it puts the big company at an advantage? Mr. Pilnick: well, any company that has enough... Rev. Gibson: At that point the big company is in advantage that has more reserve. I would be opposed to that. That's not fair. I want to make sure that's in the record. Mr. Plummer: Repeat that, Father. Rev. Gibson: If the consideration is that the company that promised to pay its franchise fee in front, so we could use it is exercised, I'm saying that's unfair to any middle company or small company. Now, you know, let's put that on the table as being fair play. I would be unalterably opposed to it. Now, if you put your money up in front, you know what I want to say "Thank you, God". That's right, because later on, you know, I'm not going to get it. Mr. Plummer: Mr. Pilnick, I... it's brought to my attention that in the ordinance, that it's a minimum of five hundred thousand dollars a year. Is this possibly why no one made comment on it? Mr. Pilnick: Well, I believe that if they don't make comment on it then, in effect, they would have to comply with the ordinance requirement. If anyone wishes to offer more as one company did, then at least, as an up front advance that's their prerogative. Mr. Plummer: Well, do I understand that all five companies being represented here this evening and hearing no one contest to the negative, that in fact, that is accepted as fact? Mr. Pilnick: Right now, Commissioner, it's a requirement by ordinance of the City and unless they take exception to it they must comply. Mr. Plummer: Alright. I was very concerned in putting the RFP together of what money in effect, was totally dedicated to the Miami system and could not be used for any other of their operation. I don't find that figure. Mr. Pilnick: I think that's a hard thing to respond to. I think every company, if it applies for a major franchise make sure that it has the money available and that money presumably is available until the time that you make a decision either for or against a particular company. In that time if you were to take considerable period before you have made your determination, many of these companies bidding to other franchise areas and they may have new financial commitments. Mr. Plummer: That was our concern. Mr. Pilnick: I think they will all claim that the money for Miami is reserved for Miami until they are either in or out. Mr. Plummer: Can that be locked in, in negotiation? Mr. Pilnick: Well, I think you can certainly get evidence from their corporate finance people and from their banks that the money is available. ;:r. cr: And I want to tell you something, not you Mr. Gary. Mr. Merrill, some of these things that this Commission was so adamant and spent so much time in developing the questions for this RFP, I don't find here coming out the way I think this Commission intented them to be. gl 64 JUL 7 '�98� 0 (CbW,MNT INAUDIBLE) Mr. Plummer: Well, you might have put it in, but I don't see the answers and that's what bothers me. I noticed with one of the companies that they did in fact, give a number of how many channels they would give to the exclusive use of the City. I did not find this in other applications. Mr. Pilnick: There is in the ordinance, I believe, Commissioner, a requirement for some minimum commitment of channels to the City. Mr. Plummer: How many is it? You see, let me tell you what bothers me, Mr. Pilnick. We have from ---right or wrong ---the Fire Department an evaluation by them of what it will cost in their estimation to activate one of these channels and keep it active for either fire training or fire prevention or things of that nature. Now, I am concerned that they, the company that's chosen, gives us a channel and we can't afford to use it. That's a deep concern and I don't find that covered in this. Mr. Pilnick: That's even more of a concern for the community channels I think, because many of the community groups have even less resources than the City has respect to using a channel. Mr. Plummmer: And how do we correct that? Mr. Pilnick: Well, you have to evaluate what they have committed, at least, what you can understand of what they have committed towards support for programming. Support, both for City Government Agencies and for local groups. Some of the support they have listed is specific. The dollars they will spend on facilities, some of the dollars that they will make available for grant purposes or for providing support. Some of the support as indicated is not specific and I think that the areas that are not specific do have to be clarified. But I think... I would suggest that, that be part of the negotiation process. Mr. Plummer: That is proper in the negotiation? Mr. Pilnick: Yes, sir. Mr. Plummer: You spoke to the rates to subscribers... Mr. Pilnick: Yes. Mr. Plummer: ... and I think, don't hold me to this, that pulling from the transcripts of the last meeting of which I was not here, you made the comment to not give too, much as I recall your wording, don't give too, much gravity to the evaluation of rates because you should be more concerned with the quality of the service and because that the quality of the service could vary, the rates would be different. Would you go into that, plus, would you also answer for me, since you deal nationwide, how do these particular rates go nationwide? Mr. Pilnick: Well, to answer the second question first, they are what I would call bargain basement or loss leader rates in the sense that almost every company bidding for a new franchise will quote rates for more services and more complexed services than they are actually charging in systems that they are already operating. And that's one of the benefits or enticements that they put into the franchise proposals to make the offer look attractive. So, if you are asking me are these rates that the companies would really like to have and perhaps feel that they should have, my general response would be, I think they are lower than what most companies feel is probably realistic for the system. That's one reason I think why I suggest that you look carefully at rates, that they are bargain basement rates usually going in. Secondly, the rates are only guaranteed initially. The only commitment you have is the guarantee that the company gives you with respect to how long it will keep those initial rates for us and even with the best guarantees that isn't very long, because if the system takes two to three years to build and if they guarantee the rates for two to three years , then the first subscriber on is faced with a rate increase in many cases before the last subcriber actually is connected. Mr. Plummer: Then I am mistaken. It was my understanding that the guaranteed rate was only from the time that the system was operational. gl 65 JUL 71981 Mi, Pilnick: If the wording is different for the various companies and I think if you look at the guarantee, a specific summary of the guarantee I can read to You. (COMMENT INAUDIBLE) Mr. Pilnick: No, that's the advantage... the weakness and strength column, but in the original summary... Mr. Plummer; Ok, Mr. Pilnick? Mr. Pilnick: Yes. Mr. Plummer: In the ordinance for cable television--- I knew it was somewhere here--- "Initial basic subcriber rates shall be effective for a minimum of two years from the date of commencing operation or until the licensee has completed all construction as indicated in his construction time table, whichever is longer". Mr. Pilnick: well, if you take the first requirement you have two years from the date it commences operations. They count the date it commences operations as the date they get their first subscriber on the system. They ususally open up portions of the system in various parts of the City on a phase basis. So, that one portion of the City may get service today, that would be their starting date. Other portions of the City would get service sequentially later on, perhaps three or six months later and if the system takes two years to construct, by the time }hey have completed construction and are turning and connecting the last subscriber, their two years are up and they are then, entitled to come back to you and ask you for a rate increase. You are not necessarily obliged to give it to them, but their guarantee has run out at that particular time. Mr. Plummer: Are you saying then, that the time table of the two or three years that were in all of the proposals is for a completed system or the first subscriber on the system? Mr. Pilnick: well, I wanted to get the exact wording and so that I can respond to that. Alright, on pages 76 and 77 of the initial report let me read how the applicants responded. Americable, guarantees the rates until completion of system construction. That would mean that on the day they complete system construction or the date the system is certified as being complete, that guarantee period runs out then and that could be the day that the last subscriber is connected. At that point they could come back to you for a request for rate increase. I think three other of the cable companies also guarantee until completion of system construction. So, essentially four companies are bidding the same. One company, Cablesystems of Miami, guarantees the rates for three years from the date of franchise award. Now, they are projecting a two year construction schedule. If they can finish the construction within the two year, if they can get started perhaps three to six months after the franchise award, then the guarantee would be based on the date of the franchise award, but whether it's better or worst than what the other applicants are offering would depend on whether they met their schedule or not. If they took, for example, five years to construct the system instead of two years their guarantee would still only be for three years from the date of franchise award, in that case they would be requesting a rate increase before they have completed construction, which would be worse than the other companies guarantee. If they can build the _:stem in a year and a half or less than two years, their guarantee would be better than the others. So, whether it's better or worse depends on how well they meet their construction schedule. Mr. Lacasa: Which one in your opinion is the best guarantee as far as the rates are concerned? Mr. Pilnick: I don't think that there is that much difference between them. Mr. Lacasa: How could it be, because actually, this last one that you were explaining now is practically no guarantee at all, but at the very least is a year or may be even less, because we are talking about finishing the construction somewhere between two and three years. The other one guarantees o1,1y `.lit rates up to the point of finishing construction. So, actually, what that is doing is guaranteeing only the rate to those original subscribers at the time of the completion of the work. So there is quite a difference there. And neither one of the two, I think, that is highly satisfactory. gl 'V JUL 7 ��01 Mr. Pilnick: I think that when you compare them there is not much difference between them, Commissioner Lacasa. In the case of four of the companies, when they guarantee the rates until completion of the system, let's assume that one of the companies will take two years to build the system and let's assume that it takes one year to get all the clearances and the go aheads from the utility companies, they would be then guaranteeing the rates until the end of year three. If Cablesystems takes one year to get ready to construct and then meets their two year construction schedule, they also would be guaranteeing the rates for only three years. So, that whether one is better than the other depends on how fast they can build the system. Rev. Gibson: But what we are doing is permitting them to take the people. Why don't we go to the position that this rate goes into effect when you start operating? Mr. Pilnick: Well, the rate that they have quoted does go into effect when they start operating. Rev. Gibson: No, no when the system is operation for me is, when you are ready to say to the subscriber, for instance, we are going to start our business tomorrow morning, so then the two years start running. To do otherwise, the people are being rooked. Man, we can't afford to be a party to that. Mr. Pilnick: Well, the problem, Commissioner Gibson, is that you don't turn on the system to everybody in the City at the same time. If you did that you would have a clear starting date. You turn on the system and you provide service to different parts of the City at different times. Somebody will always be the first to be connected. Somebody will always be the last to be connected. And as long as you have a fixed number of years before they can request a rate increase, the one that's on the shortest on the system will be facing a rate increase faster than the others. The only other alternative is to try to have the cable company maintain its rates for two years for each individual subscriber and that gets almost impossible to administer because you can't keep track of everybody individually. Rev. Gibson: But, if you complete your system, say January 1st, I think that the people who get on board, say, one year later they will only be there for a year with talking about a two year thing, ok? If you didn't do that, then you will penalize the people. I wouldn't be party to that. I take the position that if you are late getting on, I'm sorry, my brother, you should have started early. So you have to take care of the guy who started early. That's to me the only fair and equitable way. Mr. Pilnick: But what will happen, Commissioner Gibson, is that in one part of this City, perhaps your part, they will connect maybe twenty or thirty thousand subscribers within the next three months. In another part of the City they might not offer service until six or nine months later. That's the way cable systems are built. They are built in pieces and they offer service in one piece before they get completely finished in the other pieces. So, there will always be some people that get service earlier than others. Rev. Gibson: I understand that, but I'm saying that I don't want the service systems time to run, say two years, until the completion of the first piece -nd If I have to go piece, piece, I will deal with that. But to do otherwise you aren't being fair to ':he people. Mr. Pilnick: You do have in your ordinance, again, just to repeat what you have got in your basic ordinance. It says "Initial basic subscriber rate shall be effective for a minimum of two years from the date of commencing operations or until the licensee has completed all construction as indicated in his construction time table, whichever is longer, whichever is longer, but it... in either case you are not going to be able to allow the same period of time at the lower rate for everybody in the City. Mr. Lacasa: so, to make it simple, everybody meets the ordinance requirements and there is one company that is probably giving a little bit more if they finish before, which would be, actually, to their advantage and that is Cablesystems. That's the final analysis? Mr. Pilnick: That is correct, sir. And that's why they received a strength in that particular area. gl 6'7 JUL 7 1981 Mayor Ferree I will tell you, if you write down the correction and before we break up I will give everybody a little crack at it, a minute or two and then we are going to leave. You got much longer to go? Mr. Plummer: I don't know. I'm just exercising what I was given the right to do if I kept quiet and I tried to keep quiet. Mr. Pilnick, nobody on this Commission, sir, wants to drop atom bombs as you spoke of before in the meeting of the 26th. Yet I don't find any provision for penalties for non-compliance. Mr. Pilnick: Yes, sir. Mr. Plummer: That concerns me. Mr. Pilnick: Well, in a recommended draft franchise ordinance or franchise agreement which we would be providing to you if we assisted you in that area, we have a series of penalties that we have been negotiating in other cities over the past year or so and that we think will be appropriate and they include a variety of different kinds of penalties. They include monetary penalties in New Orleans, for example, for late construction. The company can forfeit a penalty of up to ten thousand dollars a day and ten thousand dollars a day is three and a half million dollars a year. So, that, that's a substantial enough amount to make the company think twice about perhaps saving on some interest costs. There also, is the ability for the city at its descretion to order reduction in rates or rebates for failure to provide adequate service or failure to provide the level of service that has been committed. We take this into account with respect to consideration of rate increases. The failure to meet commitments is one major item in that particular category, regardless of whether the company is making a kind of right of return that it expected or not. So, that I think we have a variety of different penalties which we would recommend and you can adopt those that you think are pertinent. Mr. Plummer: And that's done in negotiation? Mr. Pilnick: Yes, sir. Mr. Plummer: Alright, sir. Sir, from the minutes of the 26th meeting, I would like you to clarify one thing in particular. On page 7, the Mayor said "So, in other words, all of these are worthy offers?, as you said some are better than others and that we will get into, but none of these are so bad that you would disqualify anyone." Mr. Pilnick, "Not at this time, no." What does that mean, sir? Mr. Pilnick: That meant, that I felt that the City should continue with its deliberations, go through the process of listening to the cable applicants, as you are doing now, as all the questions, get all the answers that you wish to and when you feel you have enough information, you can make a decision on either disqualifying or reducing the number of applicants or selecting one applicant as you see fit. Mr. Plummer: On all of these companies that are the bidders at this time... I noticed one company had six hundred twelve companies and others had three or four, 1922. Did you Mr. Pilnick, as the consultant or Mr. Merrill, you the administration, solicit from the cities that they were doing business with a letter of recommendation? why aidn't you? Mr. Pilnick: Well, I will answer for myself, Commissioner Plummer. I am generally familiar with most of the large companies operations. I'm nItthink familiar with each of six hundred systems that a company may run. The answer I have fair knowledge of their general reputation in the industry. to your question is "no". I did not solicit any references, because I think that this really is a two stage process. If you have a number of bids for building a building in the City or doing any other contractual work, I think your first job in the bid is to determine either the low bidder or the best bid according to the rules you set up. Once you have done that, I think before you go ahead and sign a contract or make an award, then it is your responsibility to check into the credibility and the performancetof that a particular rily have tcompany ara if vni3 find things that disturb you, you accept that bid. And I am saying the same thing is true here.What ut f weare trying to do, I think, is evaluate the offers and try figure which is the best offer. I think at that time it is appropriate then, to ask questions about the track record of the company. Mr. Plummer: Mr. Pilnick, I was very concerned, sir, when we were putting the RFP's together that tie state of the art of cable t.v. is, as I see it 91 68 JUL 71981 r F birt is changing daily. you know, it used to be that as I saw on one of the presentations they initially started with thirty-six channels. Now, we see one Up to a hundred sixty-four. The rates and the guarantees to the City, not in hard dollars because that's set at the present time by the FCC, but it would seem only logical to me that if something new were to be added tomorrow that they could provide to the people of the City of Miami beside the five percent that the City would get out of it in hard dollars, that the City, once again, would be entitled to some soft dollars or what soft dollars represents. I did not find anywhere in any of these proposals a limiting of the scope of their operation based upon what they are offering to the City today. Do you feel that this City would not be diligent in trying to get everything for the people of this community that we can if we didn't do that? Mr. Pilnick: I think you should certainly try to get everything that you can at this point. In terms of projections for the future as I indicated before, I think it's pretty impossible to try to predict what new state of the art developments will be occurring at what particular time and to write in ironclad guarantees that you will get that. I think the best that I can suggest there is to setup a process in the franchise agreement by which at periodic intervals, perhaps every two or three years, the City will review with the cable company, perhaps require a report of the cable company, as to what new services are being offered in other systems of comparable size and justification for why Miami is not getting those services and whether or not the company will commit to providing those services. I think, once you can compare what the system here is doing with what's happening in other systems, that you should have the ability to sit down and renegotiate to get that, but that will not, Z think, be a unilateral requirement. I think all the new will be whether services and upgrading the system cost money and the question or not you will be interested in having specific upgrading features if it involves, for example, a rate increase. Those are decisions that you will have to make at that particular time. So, I think it's important to set the process up and to have the ability to review and renegotiate, but I don't see a way where you can in the original franchise agreement, put in some sort of general language that will obligate the company to make any expensive improvement you want without the company itself getting something in return. I think you do have to look at the franchise agreement as a contract and there is consideration on both sides. Mr. Plummer: Alright, sir, thank you. Mr. Pilnick: I don't know if anyone is interested in me responding to some of the comments of the cable companies, if not, I would just as soon let it go now, but if you wish I will respond. Mr. Plummer: I will leave that up to the Mayor. (COM1•1ENT INAUDIBLE) . Mr. Pilnick: I was saying in view of the hour, Mayor Ferre, if you wish me to respond to some of the comments the cable companies made with respect to the consultant's evaluation, I will do that. If you wish to defer that to some other time, that's up to you. Mayor Ferre: Well, I don't mind staying another ten or fifteen minutes, but that's about it. But T will leave that for the rest of the... does anybody have any strong feelings about this? Rev. Gibson: I think we ought to adjourn. Mayor Ferre: We ought to adjourn, ok. Mr. Carollo: I agree, Mr. Mayor. The only thing I would like to ask Mr. Pilnick, if he would remember to provide to the Commission a comparable study in comparison to other franchises that have been awarded in major cities in the last few years as to the proposals that we have here before us. I not only want to compare the companies that are before us with one another, but I want to compare them with national fra:-ichises that have been awarded. I want to see if we are indeed getting more or we are getting less. Mr. Pilnick: I already have, Commissioner Carollo, submitted to your City Manager's Office copies of the summary evaluations and the proposals that the companies have offered cities where I was involved as a consultant. I don't immediately have available those for the cities where I was not involved 69 gl JUL7 1931 Jh the detail that I think you want, but I will try to get those too. But I think you already have about four or five that you can compare to. some the last couple of years of major cities? Mr. Carollo: Well, can you get Mr. Pilnick: Well, Portland and New Orleans were twoathat halfwas anddirectly think you involved in and both have been within the last year an can coT�Rare those directly. It Mayor Fp- rre: Alright, would you do that then? r already has copies of that information, sir. Mr. Pilnick: Your City Manage Mr. Gary: We will get it. Mayor Ferre: No, not Iwitousto•give usisn't an evaluationManager, f, youiknow,•and compare to. our consultant, we wan y t Mr.�Pilnick: Alright. Mayor Ferre: And also, I think uwe need tnithothe1Law Departmentytonlooklintowsuits, but�I would like for you in conjunction ction w any serious, you know, lawsuits. I don't know, George, how you can definite a serious lawsuit, but you will have to have somebody kind of read through a little bit.and if there is some of these lawsuits that you peculiarity inone anyw way or the ertinent to the City of Miami, that might showhld snpar be brought to our attention. P other of any of these companies, I think that s 0- better since they were mentioned is implied with each one of them I have to vote. Rev�•Gibson: Mr. Mayor, I think it would be to have the Legal Department tell you what just to... because he doesn't have to vote, Mayor Ferre: Ok. Rev. Gibson: And then he must tell me if company number five was involved in... company number five is in court because of this, tell me that. And every case that was mentioned here today... well, in the course of the day, should be answered. Otherwise, let me tell you this. When you tell me Iou aregetalreingscared. in court and all that business and you are not doing y our do,You understand what I'm saying? so, I don't want to be scared of a company that I don't have to be afraid of. That's what I'm talking about. bo t.coit ay who not be significant. What was it? One company said they were back was that said they were back in court on their own? Which company was that? No, no, no, no... Milwaukee.He said he was back in court, that the city take him back in court he was there of his own volition, isn't that right? Listen, you ebtereranswer up herenow, and answzevrriseyoulmay be darn rightholding that against you. You b get wait, wait hold on. Because if I'm going to let you Mayor Ferre: Well, now, come up to say something I have to let everybody wescan gete come uthisdinswriting or equal amount of time. so, is there any } that we can get the answer the next time? Rev. Gibson: Alright, I tell you what, you put it in writing and I promise you I'm going to read it. Mayor Ferre: Alright, now, Mr. Pilnick, the questions that have been popping up that you need to answer, would you do that in writing too? eady been Mr. Pilnick: s,sir. their Eaponsesost of them and I alreadyvhaverthem answered by the applicanlits in second -report. Mayor Ferre: Alrig}-it, now, ladies and gentlemen,Itink we are have out getting of the five applicants necessarily get UP ready ,tfl wind up. Do an} , I'm going to give and say anything at. this point. If any one of you get up the other four ar, equal tillle. Anybody have to get up and say something now? then here is what, Father,recommend.ould like to recommend. Alright, seeing none, six ptoi?je ti at have tulle C011ling t0 t1,�lllaStelILSre �, , fGurteElall111nllteS b7]C1�1XSt8r six minutes, vision, four njinutes, Cablesy Now, this was unused time of both periods and Neilson, thirty-two minutes. I think at the next Commission Meeting I would allow that additional time gl 70 JUL 7 1981 i 1 r to be used by the individual company. Mr. Carollo: Maurice, who... Mayor Ferre: On the 14th, yes, sir. Now,... sir? Alright, nowr with regards to the time. I have checked my calendar and I unfortunately have a 1 o'clock luncheon that I'm not going to be able to break. So, I would appreciate it instead of at 1 we could meet at 2. Mr. Plummer: No, problem with me. Rev. Gibson: My I say what I would appreciate? Mayor Ferre: Yes, sir. Rev. Gibson: That if we list that meeting for 2 o'clock I don't plan to come and wait until 2:30 or 3. Mayor Ferre: Well, I will tell you what, let's play that one so that we can be very, very on time. Rev. Gibson: I have no objection. Mayor Ferre: Let's make it at 2:30 then. Rev. Gibson: Beautiful. Mayor Ferre: And then there is no question that there wonrt be any problems on time, ok? Mr. Carollo: Latin time or... Mayor Ferre: No, 2:30 sharp. Alright, now before we leave there are several other housekeeping things I need to do. In the first place, let me officially announce that there will be a continuation of this public hearing on the 14th of July at 2:30 P.M. and I would like to ask the Clerk to so advertise that this public hearing has been continued until that time, so that we are legal. Now, lastly, so that again, we don't have any problems as to what the batting order is in the final presentation, I would like to do the following. When we meet at 2:30 on the 14th we will be at the question level of the questions that have been asked, Mr. Pilnick's written report, the Commission will then be asking questions of Mr. Pilnick and I will then open it up for questions by members of the Commission of each of the different groups on questions that have been unanswered. Now, after that's all done and over with, assuming that all those questions will have been answered, I will then permit the five applicants to have a final statement to the Commission. Now, would ten minutes be fair? Does anybody have any objections to ten minutes? Mr. Carollo: I do Mr. Mayor. Mayor Ferre: Five minutes? (COMMENT INAUDIBLE) Mayor Ferre: You do. Mr..Carollo: If I may... Mayor Ferre: Five minutes? Mr. Carollo: Why are we limiting ourselves to hear so little from these five companies? I, for one feel that if it's such a important decision that we are about to take, then we really should give each company whatever amount of time they feel they need to present their presentation. Mayor Ferre: Ok, I have no problems with that as long a thanit ssomet else, equal. I don' t want to reall give anybod any bpe-=rice that would be unfair. Mr. Plummer: Well, why don't you say thirty minutes or less. gl 71 JUL 7 `901 A �� Mayok Petre: Ok. Does anybody have any objections to a thirty minute presentation, final presentation or less? (COMMENTS INAUDIBLE) Mayor Ferre: I don't want it, but Commissioner Carollo has made a valid point. Mr. Carollo: I want to make sure that, you know, whatever any company has to say gets said. Mayor Ferre: Alright, let me put it to you this way. Does anybody want more than ten minutes? Does anybody of the five applicants want more than ten minutes and this is going to be after you finish the meeting is over from presentations point of view, questions point of view and hopefully at that point we will be ready to vote. Mr. Plummer: Mr. Mayor, you have overlooked one point. It's scheduled as a public hearing. You did not outline any time for the public. Mayor Ferre: Well, as you may recall, Commissioner Plummer, when we closed the public discussion portion by a vote, I stated into the record that on the 14th I would reopen it again and I... Mr. Plummer: But in this last five minutes, sir, you did not delineate a time frame for the public to speak. Mayor Ferre: No, sir, in the last five, ten minutes -he public will not have an opportunity. This is after all the public questions have been put in. I will open it up for public discussion after all the Commissioners have asked all the questions, after Mr. Pilnick has had all the opportunity to make all the statements that he wants to make, then we will turn around and give each one of these applicants ten minutes to say whatever they want to and at that point the public portion and discussion is closed and I would hope we would get to a vote at that point. Now, does anybody have any objections to that procedure? I have got... Janet, are you involved with any one of these groups? Alright, you come up here and you pick and you get back to me and this will be the order in which you will make your presentation. Number one will be Cablesystems. Nuriber two, will be Sixstar Neilson. Number three, Miami Telecommunications. Number four, will be Americable and the lastyobviously, is Vision Cable. Ok, does that conclude our hearing tonight? rn TnT1 V"VrNT - There being no further business to come before the City Commission, on motion duly made and seconded, the meeting was adjourned at 11:40 O'clock P.M. ATTEST: RALPH G. ONGIE CITY CLERK MATTY HIRAI ASSISTANT CITY CLERK MAURICE A. FERRE M A Y O R 72 JUL 71981 J