SPECIAL COUNCIL MEETING

The Special Council Meeting was held on January 29, 1992 at 7:00 p.m. with Council President Christiansen presiding. Members present were Councilmen Lambert, Daisey, Levitt, Pitts, Salters, Lynn, Weyandt and Hare.

Council staff members present were Mr. Worley, Mrs. Boaman and Mr. Pepper.

A public hearing was held regarding the franchise held by Storer Cable. The public hearing is part of the initial proceedings required by federal law when a cable operator seeks the renewal of its franchise. The purpose of the hearing is to receive public comment in the form of oral testimony and otherwise obtain information to assist the City in identifying the future cable-related community needs and interests, in reviewing the performance of Storer Cable under the existing franchise, and in establishing the requirements to be satisfied by Storer Cable during the next franchise term, if its franchise is renewed. In addition, written comments will be accepted through the review process.

Deputy Solicitor Pepper outlined the franchise renewal process, stating that the process begins three years prior to the expiration of the current franchise. The current franchise with Storer expires on January 21, 1994. The first step is a public proceeding to give the public an opportunity to participate in the process for the purpose of identifying the future cable related needs and interests of the community and reviewing the performance of Storer under the existing franchise. Information obtained from this public hearing and future public hearings will help Council establish the requirements to be met during the next franchise term. At the conclusion of all the public proceeding portions of the renewal of the franchise, a proposal for franchise renewal will be submitted. The City can request that the submission for proposal indicate the requirements for equipment and facilities. The City cannot dictate requirements for video programming or any other informational services nor can the City currently be involved in rate regulation, although some change in rate regulations may be coming from Congress. Once the formal proposal for franchise renewal is received from Storer, the public will be notified for further comment. Within four months after the first step of the process (public proceeding portion), the City must either renew the franchise or issue a preliminary assessment that the franchise should not be renewed. If such an assessment is issued, Storer may then request an administrative proceeding. The purpose of that proceeding is to formally consider the full renewal criteria specified by federal law. At the conclusion of the administrative proceeding, the City would then have to issue a written decision granting or denying the franchise based upon the record of the administrative proceeding.

Prior to opening the public hearing, Council President Christiansen requested that Jeff Carlson, District General Manager, address the public relative to Storer's request. Mr. Carlson relayed that their level of service is excellent, stating that a survey shows 79.5% of their customers are satisfied with their service. He stated that quality is the issue and this high level of service has resulted in higher customer costs. Over the last eight years, they have expanded their lobby and dispatch hours, launched a new billing system and they have exceeded the NCPA standards on service. Mr. Carlson stated that they are committed to the community, offering free cable educational programs through the school systems and they often work with charitable organizations to raise funds. A short televised presentation was shown, depicting various types of programming offered by Storer.

Council President Christiansen declared the public hearing open.

Sue Wheeler - 912 Janeka Lane

Ms. Sue Wheeler of 912 Janeka Lane expressed her desire for the addition of the network EWTN (Eternal World Television Network). She submitted copies of over 400 signatures of citizens asking for this network which is a Christian network that appeals to young and old. The states of Delaware and Wyoming are the only two states without this network. With so much violence and hatred in our society, Ms. Wheeler felt that this Christian network would enhance the lives of those in our community. EWTN is offered at no cost to Storer and should be at no additional cost to its customers.

Alonzo Moore - 105 Gordon Place

Mr. Alonzo Moore stated that his neighborhood prohibits antennas or satellite dishes. He, therefore, is held captive to use Storer Cable for television use. He questioned a copyright fee that appears on his monthly statement and asked if Storer makes money from the Home Shopping Club network. He complained that he no longer receives the Storer Magazine and voiced objection to Storer customer lists being sold to other companies. Mr. Moore stated that the high rates of Storer need to be regulated so that the citizens can afford the service.

Mr. Moore also complained of channel duplication and lack of available programming.

In response, Mr. Carlson stated that Storer does not sell a customer list to anyone. Copyright fees are charged to Storer for the copyright material received on broadcast stations. These fees are shown on the bill so that customers can have a complete itemization of fees. Storer receives income from the Home Shopping Club network. The Storer Magazine is available upon request.

Hank Gizara - 15 W. Terry Drive Magnolia, DE

Mr. Hank Gizara complained of a fee that is required to downgrade your service. When he requested use of HBO he was charged a fee for the service. After discovering that HBO contains duplication of the same movies throughout the month, he was required to pay a fee to cancel the premium channel. Since he is on a fixed income, he asked for the lowest level of service to keep his rates low. He was told that basic 12 channel service is no longer available and that new customers are required to take the full Tier service which costs approximately $28 per month.

Responding, Mr. Carlson stated that Storer charges a downgrade fee for premium channels to ensure that customers do not constantly change from one premium channel to another, which creates a tremendous amount of paperwork and will increase administrative costs.

Walter Johnson - 1507 Fawn Street

Mr. Walter Johnson of 1507 Fawn Street voiced his opinion that cable customers are held captive since they have no other options other than cable service. He stated that Storer seems eager to share information on their expenses but will not share their income data.

Nancy Wagner - 283 Troon Road

Ms. Nancy Wagner, representing Mrs. Miriam Hughes of 1302 Afton Court, stated that Mrs. Hughes requested 12 channel service, as advertised, but was told that it does not exist and that she would be required to subscribe to the full Tier service. She was told that citizens that have the basic 12 channel service were permitted to continue the service, but that it would not be made available for new customers.

Mr. Carlson stated that this must have been a misunderstanding. Storer does offer 12 channel basic service to all customers at a fee of $17.35.

Paul Couture - 123 Blue Beach Drive

Mr. Paul Couture stated that Storer continues to relay that their service is good. It is his feeling that their service has to be good for them to stay in business. Their rates are excessively high and he urged the City to investigate service from other cable companies. Mr. Couture also disagreed with the downgrade fee, stating that a customer should have the choice of discontinuing a service without penalty.

Gina and Steven Bloom - 111 Loockerman Street Apt. #5

Mr. & Mrs. Steven Bloom stated that they also requested 12 channel basic service and were told that it was unavailable to new customers. Mrs. Bloom stated that it cost them $75 to connect to cable when the cable line was already in their apartment. Mr. Bloom relayed that they were charged a $5 late fee, although their service is billed one month in advance. He felt it totally unfair to charge a customer a late fee for a service that they have not yet received.

Mr. Carlson stated that customers agree in writing, prior to service, to pay for the service one month in advance. A late fee, however, is not assessed until the bill is truly delinquent. He agreed to look into the late fee for Mr. & Mrs. Bloom.

Ed Barnes - 50 Greenhill Avenue

Mr. Ed Barnes objected to the additional outlet fees. He suggested that the cable companies copy the pattern set by telephone companies where they charge for service to the home, leaving the number of outlets in the home up to the homeowner at no additional charge.

Mr. Carlson stated that the revenue loss from additional outlet charges would have to be made up from another source. Also, it has been their experience that for each additional outlet in a home, the chances of required maintenance are increased. Mr. Carlson stated that the customer base is not increasing enough to offset costs, limiting their ability to enhance service without increasing rates.

Mike Jacobs - 518 Sunset Drive

Mr. Mike Jacobs voiced his support for the inclusion of the EWTN network. He also stated that upon moving to Dover he was surprised to find that public access television was limited to coverage of governmental meetings. Many other cable companies provide communities with a studio for civic organizations to speak on issues of interest to the community and for educational programs, locally oriented. He suggested that Dover require Storer, through its franchise contract, to provide such a studio to its users, as well as the necessary equipment and limited staff to provide utilization by citizens.

Lori Bryner - 301 William Street

Ms. Lori Bryner complained of being charged a $5 late fee, when her service is paid in advance. She also felt that the billing statement is confusing since the amount shown as total due does not include the $5 late fee. In her travels, she has found that nearby states are receiving the same level of cable service for $19 to $23 per month, as compared to Storer's rates of over $30 per month. She recommended that Storer concentrate less on premium channels and devote more time to find a way to offer basic service at an affordable price.

Javan Davis - 635 Nimitz Drive

Mr. Javan Davis stated that Storer's prices are outrageous. Many of our citizens are on fixed incomes and cannot afford the service. For many elderly citizens that live alone, their television is their only friend and their only source of communication with the outside world. Mr. Davis suggested that Council shorten the length of the term for the franchise and to consider other options for its citizens.

David Anderson - 87 Spruance Road

Mr. David Anderson supported the addition of the TBN (channel 67) network to Storer's programming. Mr. Carlson explained that Storer has not reviewed its channel line-up for the year and will not do so until some resolution comes from Congress on S.B. #12. He stated, however, that TBN is a low powered station and he was unsure of the legalities involved in providing a low powered station on their cable. He suggested that Mr. Anderson call him so that he can investigate the matter.

Frank Arbaugh - 22 Troon Road

Mr. Frank Arbaugh referred to the results of the survey taken by Storer, stating that only 200 people were surveyed, which is less than 1% of their customer base. Mr. Carlson explained that a firm was contracted by his company to perform a survey to determine customer satisfaction. The company randomly selected 200 customers to respond to the survey.

Deanna DuChen - 2275 S. State Street

Ms. DuChen suggested that the City of Dover perform its own survey. She reported problems with Storer's sound and picture quality, especially on the premium channels for which she pays additional fees. She also complained of repetitive programs and channels that are only televised for certain hours of the day. Responding to questions on the City's bidding process, Mr. Levitt stated that the franchise is non-exclusive. Mr. Levitt reminded the public that in 1984 federal legislation prohibited the City from controlling basic rates. He suggested that rate complaints be directed to our congressional delegation in Washington, D.C.

Referring to the complaint of repetitive programming on premium channels, Mr. Hare explained that programming is not determined by Storer for network channels. Storer subscribes to the network as it is offered.

Responding to Ms. DuChen's questions on the regulatory agency for cable companies, Mr. Levitt stated that they are regulated by the Federal Communication Commission.

Patrick Shaulles - Hartly, DE

Rev. Patrick Shaulles voiced his support for the EWTN network. With so much violence and crime in our lives, Rev. Shaulles suggested that such a channel would subject our children to more positive television viewing.

Buz Johnson - 348 N. Governors Avenue

Mr. Buz Johnson voiced his support for the addition of EWTN. He complained that Storer does not offer the full 60 channels as do most other companies and he feels that their programming is limited. He suggested that Council require more channels prior to approval of the franchise.

Walt Bagley - Milford, DE

Mr. Walt Bagley, owner of a Dover business that subscribes to Storer, stated that Storer has assisted him many times. He is President of the Kent Ecumenical Food and Crisis Fund. Storer has assisted them in their annual financial drive by diverting hookup fees to their charitable organization. They have also offered this opportunity to other charitable organizations in Dover. Mr. Bagley stated that Storer has a vested interest in the community and he expressed his appreciation for all that they have done.

Patience Bartram-Kemp - 820 Carvel Drive

Ms. Patience Bartram-Kemp informed Council that she recently moved to Dover from New Jersey and was astounded at how much higher her cable rates are in Dover than in New Jersey. She stated that she is on a fixed income and like many others, cannot afford increased cable rates.

Tom Costello - 177 Merion Road

Mr. Tom Costello voiced support for the addition of EWTN, stating that it would be nice to have an alternative channel that offers positive, slower paced programming. He felt that this is a wonderful channel for children and requested that Storer consider adding this channel to their programs, especially since it is offered free of charge.

Mr. Carlson stated that although the programming is free, the channel capacity is not. Channel capacity will require additional capital investment by Storer and although Storer will attempt to respond to the requests of its customers, increased costs must also be considered.

Responding to questions on Storer's profit ratio for 1991, Mr. Carlson stated that a copy of their Annual Report is available for public viewing.

John Stinger - Milton, DE

Mr. John Stinger stated that there is high potential for education in satellite programming. He suggested that Council only approve a short term franchise and that they give consideration to operating their own cable company. Mr. Stinger offered additional suggestions in a letter to City Council (as on file with the Office of the City Clerk).

Nelson Farber - 204 President Drive

Mr. Nelson Farber asked that Storer Cable offer a discount to elderly and disabled persons. He stated that he is disabled and does not often get out of his house. His television is an important part of his life, but the high rates are making it impossible for him to continue the service.

Paul Jones - 180 Merion Road

Mr. Paul Jones voiced his support for EWTN and expressed his disappointment in Storer's position that they will not review channel line-up until knowing the outcome of S.B. #12. Mr. Hare stated his feeling that Storer is awaiting the outcome of pending legislation so that time and money is not wasted on channel line-up review if the their regulatory rules may be changing.

Ms. Terry LaRock - 3537-A Hawthorne Drive

Ms. Terry LaRock stated that many times customers wish to downgrade their service because they can no longer afford to pay for the premium channels. It seems ridiculous that they would be required to pay a $10 fee to downgrade because they cannot afford the service. Mr. Carlson again explained that constant changing from one type of service to another is extremely time consuming and costly to Storer. Responding to a suggestion that free downgrading be offered to customers that have the service for an extended period of time, Mr. Carlson stated that Storer would consider this proposal. He also offered to review the concept of offering a discount to disabled and senior citizens.

Council President Christiansen declared the public hearing closed.

Council President Christiansen thanked the citizenry for sharing their concerns with Storer representatives and members of Council. Written comments are welcomed and should be directed to the Utility Committee of the City of Dover Council.

Meeting Adjourned at 10:00 P.M.

                                                                                    DEBRAH J. BOAMAN

                                                                                    CITY CLERK

All orders, ordinances and resolutions adopted by City Council during their meeting of January 29, 1992, are hereby approved.

                                                                                    JOHN E. RICHTER

                                                                                    MAYOR

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