Vermont Lawmakers Table Franchise Bill

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Cable lobbyists in Vermont will have another year to
convince legislators that systems should be granted franchises of 10 years or more, and
not the seven-year proposal that was considered this session.

Consumed with electric-utility deregulation, legislators
let a bill to trim franchises to seven years be tabled in committee this session, with the
assurance that it will rise again next legislative year.

Cable executives acknowledged that the industry has not
done a good job of communicating the investment operators -- primarily Adelphia
Communications Corp., which serves the vast majority of cable homes in the state -- are
making in the state.

Most of the state's cable plant will be rebuilt and
capable of offering state-of-the-art products within the next five years -- a greater
penetration than most rural states, cable representatives said.

The delay should give Adelphia time to satisfy the
state's Department of Public Services that it is not in violation of its franchises.
That body recently recommended that the cable operator be fined more than $5 million for
franchise-agreement lapses.

Adelphia's most difficult problem will be wooing
legislators to its economic point of view that it would be unfeasible to include three
small towns near Burlington in its rebuild plans.

During the next 12 months, cable operators will try to fend
off a suggestion by the DPS that state franchise language be amended to allow franchises
of "up to 11 years." Lack of a definite term would scare off bank financing
quicker than trimmed but firm seven-year terms, executives noted.

A more cable-friendly amendment, by Rep. Frank Mazur
(R-Burlington), surfaced before the issue was tabled. That amendment would set franchise
terms at 10 years, with a five-year extension available if Adelphia and other operators
make good on rebuild plans during the initial term.

Bill Durand, executive vice president and chief counsel of
the New England Cable Telecommunications Association, said members like the current
11-year term, and they will lobby for the status quo.

"We've got a lot of work to do. Committee members
can't continue to say, 'I'm sick of these rates going up,' and force
some of these issues," Durand added.

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