Michigan Town Sues Comcast

Saline, Mich. Officials Say Cabler Isn't Living Up to Funding Obligations

By Linda Haugsted -- Multichannel News, 8/8/2008 1:08:00 PM

The city of Saline, Mich., is taking Comcast to court, alleging the operator has failed to fund public, educational and government programming support fees the city is entitled to under Michigan's state franchising law.

The suit asserts the operator balked at the fee established by the city: 2% of its gross revenues. The new state law, the Uniform Video Services Local Franchising Act, gives communities authority to establish that fee, the city alleges.

Patrick Paterno, director of communications for Comcast’s Michigan region, said the operator has not yet seen the legal filing and as a result, could not comment.

The suit, filed Aug. 8, asserts that Saline, a city of 8,800 residents located south of Ann Arbor, notified Comcast on April 30, 2007 that it was applying a 2% fee on Comcast's gross revenues. The city wants the money to pay down expenses that the local school district incurred when it set up a studio in a new high school there. The studio trains students in production and provides playback of city council meetings.

City officials said Comcast refused to pass the fee through to consumers because it would increase subscribers’ bills.

“We'd feel better about that excuse if they didn't take such big rate increases every year,” Saline mayor Gretchen Driskell said in a prepared statement.

The city alleges Comcast is $60,000 in arrears, with the debt growing each quarter by $11,000.