SR-501-002 (9)
e
50/~ 002
e
&-Q
Jl.n. 5 \981
CA:RMM:llm095
city council Meeting 7-8-86
'-" --""~
Santa Monica, California
STAFF REPORT
TO:
Mayor and city Council
FROM:
City Attorney
SUBJECT:
Resolution Setting a Public Hearing on Whether or
Not There Has Been a Forfeiture of the ci ty' s
Community Antenna Television Franchise with Theta
Cable of California and/or Group W Cable, Inc.
Theta Cable is the grantee of a non-exclusive franchise to
provide cable television services in Santa Monica which will
expire in January, 1988.
Since Theta transferred its franchise
interests to Group W Cable, Inc., formerly a subsidiary of
westinghouse Broadcasting and Cable, Inc., without receiving
Council approval in 1982, Group W has been operating the City'S
cable system. Resolution of the issue of whether Theta's merger
with Westinghouse constituted a material breach of the franchise
and what remedy should lie has been held in abeyance by mutual
agreement pending the Ci ty' s negotiations with Group W, which
were to occur following citizen input from the Cable Task Force.
In the interim, the Cable Communications Policy Act of 1984
was enacted by Congress. In accordance with its terms, Group W
sent the city a letter formally invoking the renewal procedures
specified by the Cable Act in June, 1985. Subsequently, however,
an important development has occurred.
On June 19, 1986, Westinghouse announced that it had
Ilcompleted the sale of its cable television business" to a
consortium of cable television operators, consisting of American
"..Q
- 1 -
JU.. 6 \9&&
e
e
Television & Communications Corporation (ATC); Comcast
corporation; Tele-Communications, Inc. (TCI) ; Daniels &
Associates, Inc.: and Century Southwest Communications
corporation (Century). Century has been designated as the
operator of the Santa Monica system.
On February 27, 1986, Group W requested approval of the
ultimate transfer of its franchise interests to Century. In
response, the city Manager sent a letter to Group W requesting
specific information about century's financial status and
operating performance which would enable the city to properly
evaluate the proposed transfer.
After receiving an unsatisfactory response to this request
for information, the City Manager sent a fOllow-up letter to
Group W on May 29, 1986, reiterating the City's request for
information. Century and Group W were also informed by letter
that transfer of Group W's stock or assets without city approval
would constitute a breach of the franchise agreement, and that
any actions by Century to take over operation or management of
the City's cable system prior to the Council's approval of a
transfer of ownership would constitute a breach of the franchise
agreement as well. The City has not received any response to its
last request for information and Group W has completed the stock
transfer.
In light of these developments, the City Attorney recommends
that the City council hold a PUblic hearing on whether or not the
transfers without prior City approval as required by Section 7(d)
of Ordinance No. 734 (CCS) constitute a material breach of the
- :2 -
e .
franchise agreement. The accompanying resolution would set such
a public hearing for August 12, 1986.
RECOMMENDATION
It is respectfully recommended that the accompanying
resolution be adopted.
PREPARED BY: Robert M. Myers, city Attorney
Laurie Lieberman, Deputy city Attorney
- 3 -
e
e
(ouncll Meeting Date
BEFORE DISTRIBUTION CHECK CONTE~T OF ALL
DISTRIBUTION OF RESOLUTION # ;??s- ~
?7/Yb
C-cp
/Vo
G- 0
FOR CITY CLERK'S ACTIO~
l'i:
ORDI~ANCE #
Introduced:
Agenda
Item it
Adopted'
AUIfAYS PUBLISH AOOPTED ORDINANCES *
*Cross out Attorney's a09roval
Was It amended?
VOTE: Affirmative~
?\egative:
J\bs tain: J1
Ab~ent: ~.jr~-r.s.
PROOF rl:-'T~E_~ _ !1frTf:11'I._\~oJ:"ff_~R P'ERSOiV BEFOFE
DISTR~UIIU^: UKlulNAL ~o be s1gn~.
~
A .....TV 'T'!-C :.. G
~~:e~' JT'~
fl~2,-: In
Vault.
NEWSPAPER PUBLICATION (Date'
)
Department orIginatIng staff report ( * )
*C~ty Attorney does not wane copl.es of his ordulances orresOlutions.
'1anager."len t Serv? ~es Lynne Barret te urdlnance s only
'"'Z-.
Agency mentioned In document or staff report
(certif~ed?)
Subject fIle (agenda packet]
1
Counter fIle
1
Others. (Revle\v for depqrUlJ8nts who need to know) .
a,' J'j- ; '" /',' ._
~lrport Parking Auth,
'\Udl torum
Personnel
BUilding Dept.
PlannIng
Cc:rrrmlIl1 ty and Econc:tn..1c [)ev.
PolIce (en-
forcement?)
Fl.nance
PurchasIng
.
Fl.re
Recr/Parks
General Servo
Transportation
Library
Treasurer
;-'1anager
'""-.
.J
....
SEND POUT>. COPIES OF ALL ORDI~A~CES TO:
CODED SYSTEHS, Attn PeteY Maclearle
1? 0 t'!al.n <'~"""et
A~ni:. Yew Jersev_OZ717
I _ r _
SEKD FOUR COPIES OF AT.t ORDT\JA\T?5 TO:
~~,,?ra '1vJ;"~ck _
__A ,fA ~1O:\ I CA \IUN I C IPAL COURT
1 "72 S \1AIN STREET, Room 118
S>\\[TA i"10NICA, CA 90401
*Check Code Sectl.ons before sendmg.
.;
:J
~
~
~
.D
o
.:::::
TOTAL COPIES
1:L/
.r -.
e
e
CA:RMM:llm094
city Council Meeting 7-8-86
Santa Monica, California
RESOLUTION NUMBER7252 (CCS)
(City council Series)
A RESOLUTION OF THE CITY COUNCIL or THE CITY OF
SANTA MONICA SETTING A PUBLIC HEARING ON WHETHER OR
NOT THE COMMUNITY ANTENNA TELEVISION SYSTEM FRANCHISE
WITH THETA CABLE OF CALIFORNIA AND/OR GROUP W CABLE, INC.
HAS BEEN FORFEITED FOR NONCOMPLIANCE WITH ITS TERMS
THE CITY COUNCIL OF THE CITY OF SANTA MONICA DOES RESOLVE AS
FOLLOWS:
SECTION 1..
The city council of the City of Santa Monica
does hereby order and declare that on the 12th day of August,
19B6, at 7:30 P.M., in the Council Chambers of the City Hall, it
will hold a public hearing on whether or not the community
antenna television franchise with Theta Cable of California
and/or Group W Cable, Inc. has been forfeited for noncompliance
with its terms.
SECTION 2.
The city Clerk shall certify to the adoption
of this Resolution of Intention and shall cause the same to be
published at least once within fifteen days of the passage
thereof, in the official newspaper.
- 1 -
.-
- T.
e
e
SECTION 3.
The city Clerk shall certify to the adoption
of this Resolution, and thenceforth and thereafter the same shall
be in full force and effect.
APPROVED AS TO FORlI:
~~.~
ROBERT M. MYERS ()
City Attorney
- 2 -
.-
.,
e
e
Adopted and approved th1s 8th day of July, 1986.
(, j' " Q /JQ ,
,LA,~k~//c ~
! Mayor
I hereby certIfy that the foregoIng ResolutIon No. 7252(CCS)
was duly adopted by the Clty CouncIl of the CIty of Santa MonIca
at a meetIng thereof held on July 8, 1986 by the follOWIng
CouncIl vote:
Ayes: Councllmembers: Conn, EpsteIn, A. l<atz, H. Katz,
Zane ana l'1ayor Reed
Noes: CouncIlmeT!lbers: None
AbstaIn: Councllmembers: None
Absent: Councllmembers: Jennlngs
ATTEST:
~ ~,dk~
CIty Clerk