Policy

Comcast Nears S.F. Franchise Extension

8/08/2005 4:58 AM Eastern

The San Francisco Board of Supervisors should vote soon on a four-year franchise extension for Comcast Corp., contingent on a promised payment of nearly $8 million in cash and public-access support by the operator to resolve alleged franchise-noncompliance issues.

The board’s rules committee recently voted to send the proposal to the full board, but without a “pass” recommendation.

Since Comcast took over operations in the region as part of its acquisition of AT&T Broadband, the company has argued with the city over whether municipal approval was necessary for the transfer of ownership.

Andrew Johnson, vice president of communications for Comcast in the area, said the original franchise, dating to the Viacom Cable era, does not specifically state that municipal approval is required -- an assertion not shared by the city and county of San Francisco.

Comcast also inherited franchise-noncompliance issues from AT&T Broadband. When that company took over city operations from Tele-Communications Inc., it promised a plant upgrade and agreed upon a specific date. But AT&T Broadband did not complete the build-out on time.

San Francisco also dunned past operators for failing to live up to a clause in the contract calling for an “independent evaluator” to annually vet operation of the system.

Due to the disputes, Comcast and San Francisco agreed to negotiate a settlement tied to a franchise extension, rather than tackling the disagreements and crafting a long-term refranchise at the same time. The current franchise for the city and county expires in December.

The settlement that will be presented to the Board of Supervisors will include a onetime payment of $3.5 million. Comcast also agreed to a stable funding source for the local-access corporation of $500,000 per year, in addition to 52 cents per customer, per month. That totals approximately $4.4 million in access support over the four years, according to Johnson.

The board’s agenda had not been posted by late last week, but the topic was expected to be included in Tuesday’s meeting.

A majority of the 11-member board would have to approve the pact, and some members have already publicly expressed the opinion that the city could get a better deal. One supervisor, Ross Mirkarimi, said he would like officials to press Comcast for a way to deliver the city’s government channel, known as SFGTV, free to all residents. He hasn’t suggested how the cable service would be delivered to noncable homes.

If the extension is approved, the parties will only have a few months before the window opens for formal negotiations on the refranchise for the region.

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