News

Florida Rate Dispute Heads to Court

11/07/2004 7:00 PM Eastern

Advanced Cable Communications is suing Weston, Fla., claiming the city intends to use its authority to pirate service from the provider.

Advanced, the city and a nonprofit foundation have been haggling over a unique franchise agreement that treats cable like a utility and requires about 16,000 of the town’s 65,000 residents to subscribe to basic cable.

Affected homeowners pay $32.99 per month for a 76-channel basic package. City officials think that’s too much.

At the end of September, the Town Foundation — formed to collect cable and other utility payments and remit them to providers — told Advanced to make changes or the foundation would set the appropriate basic-cable charge at $10.41 as of Jan. 1, 2005, and keep the difference between that and $32.99 to fund the legal fight against Advanced.

Advanced replied by suing the town and foundation on Oct. 27 in U.S. District Court for the Southern District of Florida.

The cable company has stated its intent to collect $32.99 but retain most of the charge violates state and federal theft of service statutes. It wants the court to enforce specific performance of its agreement and declare it’s charging appropriate rates for appropriate services.

At the time when the homes in Weston were built, no commercial cable operator would serve the area because it was too sparsely populated and deemed financially unviable.

In order to provide incoming homebuyers with cable, developer Arvida Corp. built a system and included mandatory subscriptions in home-buying agreements.

Advanced bought the local system in 1998 and has invested $7 million in upgrades. The franchise agreement runs until 2013.

Advanced said it now faces payments each month of $160,000 from the foundation for services it pays $500,000 to provide.

Advanced’s attorney, Terry Bienstock, said the town could have sought court guidance to resolve any dispute. “But instead, they have threatened to divert Advanced Cable’s money, which is needed to operate its business.”

Bienstock also said Weston’s trying to get Advanced to walk away from an agreement it has spent millions of dollars to honor.

Discussing the Advanced agreement, city manager John Flint recently said city officials believe no homeowner should have to contract for a service they don’t want.

He also noted the franchise agreement did not foresee the development of such options as direct-broadcast satellite TV.