APRIL 20, 1998

MEMBERS PRESENT:

Carlton Curry, Chairman
Steve Nelson, Member
Charlie Hiltunen, Member
David Leonard, Member

MEMBERS ABSENT:

Stuart Rhodes, Member

OTHER PRESENT:

Chairman Curry brought the meeting to order at 2:30 P.M.

The first agenda item was the approval of minutes from the Cable Board’s March 16, 1998, meeting. Motion was made by Mr. Hiltunen, seconded by Mr. Nelson, to approve the minutes of the Board’s March 16, 1998 Board Meeting. Motion carried unanimously.

The next item on the agenda was the status of Comcast’s outstanding audit issues. Ms. Piety stated since the last meeting she and Chairman Curry had met with Comcast to discuss the outstanding audit issues. At the conclusion of that meeting there was a agreement with Comcast which Chairman Curry asked Ms. Piety to reduce to writing and send to Comcast for its review. Ms. Piety stated she will bring the proposed settlement letter to the May board meeting for the Board review and discussion.

Mr. Curry stated the proposed settlement letter will be sent to all Board Members before the Board meeting for review.

The next item on the agenda was the Status Report-Time Warner basic tier rate review. Ms. Piety stated she has worked with Lou Karrison of Crowe Chizek to finish the review of Time Warner’s 1998 rate filing. Ms. Piety stated the Board has received correspondence from her to Jay Satterfield of Time Warner discussing the review. The actual rate that Time Warner is charging for basic tier cable service is in excess of the maximum permitted rate as re-calculated by Mr. Karrison. Ms. Piety stated this information concerning the recalculation was sent to Mr. Satterfield of Time Warner for his review and comment. Mr. Satterfield did respond. Ms. Piety stated that it is her intent to prepare a rate order recommending the recalculation of the 1998 basic tier service rate and to circulate the proposed order to the Board and Time Warner for comment before the May Board meeting.

The next agenda item on the agenda was the adoption of Comcast final rate order. Ms. Piety stated this is final rate order regarding updated rates for the period November 1^st 1997 thru October 31^st 1998, for basic tier cable service provided by Comcast. On August 1^st 1997, Comcast filed rate forms for the Board’s review. Mr. Karrison reviewed the forms and the information submitted by Comcast in response to several information requests made by the Cable Communications Agency. On March 26^th copies of the proposed order were provided to Comcast for its comments no comments were received. The Agency recommends the adoption of the final rate order.

Ms. Piety stated the findings are that the maximum permitted rates as submitted on Comcast’s rate forms were appropriately calculated using the FCC regulations and rules for the period November 1^st 1997 thru October 31 1998. Ms. Piety’s recommends that the Board approve the rates as submitted by Comcast as follows, exclusive the franchise Fee. The monthly rate for the basic service tier in the non-rebuilt area is $10.87 and in the re-built area $10.95. The rate for equipment charges for the period is November 1, 1997 thru October 31, 1998, exclusive of franchise fees, are: 1)for remote control a monthly charge of .49 cents; 2) for the addressable converter box, a monthly charge of $2.77; and 3) for non-addressable converter box a monthly charge of .80 cents. Installation charges for the same period, exclusive of franchise fees are :1) install of an unwired home- $45.20; 2) install of pre-wired home, $30.13 ; 3) Install of additional connections at initial installations - $15.07; 4) Install of additional connections requiring a separate installation- $30.13; and 5) tier changes- $30.13.

Mr. Curry asked what the charge of $15.07 for install of additional connections at initial installation covers.

Ms. Piety stated that the charges covers more than one connection or installation to the cable system from a particular location made at the time of the original connection.

Mr. Curry asked how that is determined.

Mr. Wilson from Comcast stated that would be number of service points or outlets in the home.

Mr. Curry asked whether the charge of $15.07 is per outlet. Mr. Wilson stated that was correct.

Mr. Hiltunen, motioned to approve Comcast’s basic service tier rates for October 1, 1997, thru October 31, 1998; and to adopt the rate order as proposed. Mr. Leonard seconded the motion. Motion carried unanimously.

The next item on the agenda was the CIRRI Grant Agreement . Ms. Piety stated this is a reoccurring grant that the Board has made in past years. Ms. Piety stated the amount of the Grant is $25,000 for use by CIRRI for operating expenditures, including salary of staff and office supplies and materials , such as telephone charges, duplication, brochures, postage, stationery, and miscellaneous office supplies. The Grant could also purchase pre-produced programming for playback over CIRRI’s special broadcast airwave. The amount of the grant is the same as in prior years. Ms. Piety stated the terms of the agreement are identical, except for the dates, to the grant agreement that has been approved by the Board in prior years. Ms. Piety stated she also prepared a proposal for Council approval to award this grant to CIRRI. The City ordinance that provides for the award of the public purpose grants, such as this grant requires approval by the City- County Council of the amount and the identity of the Grant recipient and approval by the Cable Franchise Board of the terms and conditions of the award of the grant.

Mr. Curry stated that the Council’s Rules and Public Policy Committee approval of this grant contingent upon favorable Board action.

The next item on the agenda was the CIRRI 1997 Grant report, presented by Mr. David Murry. As specified in its 1997 Grant Agreement, CIRRI used the grant to support its Director’s salary, purchase supplies and equipment, and acquire national programming. In 1997, more than 200 CIRRI volunteers read local and national newspapers and magazines aloud, providing people with print impairments access to everything from news and health information to grocery store ads and obituaries. Print impairments include blindness, low vision, dyslexia, illiteracy, and the inability to turn pages. CIRRI has long provided listeners the ability to tune in its signal using a special radio receiver, set to WFYI Radio’s subcarrier frequency.

Mr. Murry stated the problem of accessibility was solved in 1997 with CIRRI’s new Dial-Up service, which requires only a touch-tone telephone to access. CIRRI is also proud of its 1997 partnership with the Greater Indianapolis Literacy League (GILL) and The Indianapolis Star & News. Central Newspapers offered ten Hoosiers who could not read free four-mouth subscriptions to the paper. CIRRI hopes to continue using City-County Council funding to supplement the salaries of its two full-time staff, as well as to help underwrite the cost of additional incoming phone lines needed for the Dial -Up service. Mr. Murry stated that CIRRI and WFYI thank the Council and the Cable Franchise Board for their vital, long-standing support.

Mr. Curry stated that CIRRI has been an ongoing program which has enjoyed a high degree of popularity in the community.

Mr. Nelson asked Mr. Murry how long he has been with CIRRI.

Mr. Murry stated since May 1995.

Mr. Nelson asked Mr. Murry what growth he has noticed during his tenure.

Mr. Murry stated the growth in CIRRI was in 1996, that is when CIRRI merged with WFYI. There has been an increase in listeners on the radio side of about 50 percent due to increased publicity on WFYI TV and radio stations.

Mr. Nelson asked Ms. Piety whether the grant amount has always been $25,000.

Ms. Piety stated that it always has been $25,000 during her tenure.

Mr. Hiltunen asked who determines what is read over the airwaves.

Mr. Murry stated that what is read is determined by the volunteers; many volunteers read what they are interested in.

Mr. Hiltunen asked Mr. Murry what percentage CIRRI’s operating funds this grant represent.

Mr. Murry stated the grant is about 10 percent of CIRRI operating budget. It costs about $250,000 a year for CIRRI to operate, including utility bills, two full time staff, facility expense, and equipment purchases.

Mr. Leonard asked the source of this grant.

Ms. Piety stated the grant money is budgeted as a Cable Communications Agency expenditure every year through the normal budget process, so it comes out of the franchise fees. There are no restrictions in the franchise agreement on this grant.

Motion was made by Mr. Leonard, seconded by Mr. Hiltunen, to adopt the CIRRI Grant Agreement as proposed. Motion carried unanimously.

The next item on the agenda was the Grant Agreement between City & Indiana University for operation of the educational access channel. Ms. Piety stated this Grant Agreement, is made and entered into by and between the Consolidated City of Indianapolis, Indiana, Cable Communications Agency, acting by and through the Cable Franchise Board, (City), and Indiana University. The purpose of this Grant , in the amount of $40,000, is solely for Indiana University, in cooperation with Educational Television Cooperative (ETC) to fund educational access programming on franchised cable systems in Marion County.

The grant agreement outlines the use of the funds how ETC will account for the money, and how the money will be budgeted. Ms. Piety explains this grant has been made for several years by the City and the Franchise Board and is budgeted in the Cable Communications Agency’s budget. Ms. Piety stated she submitted this agreement to Indiana University and David Donaldson of ETC, and neither of them have any objections to this agreement. This grant requires authorization by the City County Council and a proposal to authorize the grant was heard at the Council’s Rules and Public Policy Committee and received a favorable vote.

Mr. Curry stated that this grant was heard by the Rules and Public Policy Committee and approved, contingent upon favorable Board action. Mr. Curry stated there is one difference in the grant amount of $40,000 which is $10,000 beyond what was originally budgeted last year. Mr. Curry stated since that time ETC was asked to do some things for the Fox Sports Midwest Network, justifying the increased grant amount.

The next item on the agenda was the ETC Report/ETC Grant Report. Mr. Donaldson presented the ETC report. EPS is a shared cable access channel, divided between formal educational programming and Public Safety training programming. The operations are managed by ETC, with programming content provided by the Indiana College Network and the Indianapolis Fire Department. ETC successfully negotiated use of EPS by Fox Sports Midwest to benefit the educational community. Fox Sports Midwest negotiated the use of EPS in Time-Warner territory from 6:00 PM-12 midnight (M-F) and noon-midnight, Saturday/Sunday. In exchange for this use, Fox Sports Midwest made free billboard time available to educational institutions during broadcasts of Indiana Pacer games.

ETC used funds provided from the cable franchise agreements capital PEG grant fund to upgrade the original television master control center equipment. Mr. Donaldson stated re-build of master control center was completed, and planning is now completed for the upgrade of the television master control center at IUPUI to accommodate quality playback support for the EPS channel. Funds were received in February 1998 for this project. The install plan will be implemented during the summer months in order to least impact educational programming during the school year. ETC revised its bylaws to become an affiliate organization of Collaboration 2000, Inc. which resulted in an expansion of education programs provided for ETC. This action allows broader participation from organizations with educational missions in the programming of ETC. The prior Bylaws limited participation to formal educational institutions. ETC attracted new program providers, including Black Expo, Warren Township, Indianapolis Children’s Museum, and the Indiana Historical Society, as a result of the changes in the ETC Bylaws.

Mr. Donaldson stated that as on-going objectives ETC will increase membership involvement , increase fundraising, expand locally produced program base, expand production equipment resources through approval of 1998/99 Capital Equipment Grant and maintain Quality Programming.

Finally, Mr. Donaldson stated in regard to the request for a public purpose grant, ETC is requesting its eighth public purpose grant from the City-County Council, Indiana University will manage the grant for the purpose of financing educational access cable television programming in Marion County.

The grant amount reflects the same amount as FY 1997/98. ETC is requesting steady-state funding since no operational funds were committed to the operation of the Education/Public Safety Channel. ETC remains committed to its goal of reducing its dependence on cable franchise fees as the major supporter of its operation. Mr. Donaldson stated a separate Capital Equipment Grant will be submitted for approval at a future date as determined by the Cable Franchise Board.

Mr. Donaldson also mentioned the programming overview for 1997/98 , stating the Educational Television Cooperative is currently supported by a combination of operational grants, capital equipment grants, in-kind support from member institutions and external fundraising efforts. The overall annual cost of providing Educational Access Television for Indianapolis and Marion County is $166,190. These costs include the operation of the second educational access channel which was launched in August 1997. Of these costs, $40,000 is provided by the Indianapolis City-County Council in the form of an annual public purpose grant. While much of the support is provided by educational member institutions, annual operational requirements are not funded. Mr. Donaldson also mentioned the Bylaws of Educational Television Cooperative and the ETC Master Control Capital Equipment.

Mr. Hiltunen asked whether the funding for last year was $40,000.

Mr. Curry stated that it was $40,000 last year.

Mr. Hiltunen asked whether in the year before last, ETC requested more money.

Mr. Curry stated that, in the year before last, the ETC grant amount was $50,000. Last year the grant was $40,000. This year the targeted amount was $30,000. ETC has agreed to become less dependent on this grant source. With the launch of the extra channel and the Fox programming, it seems appropriate not to make this reduction in the 1998/99 fiscal year.

Mr. Hiltunen asked whether this grant would cover the increased costs due to the added channel . He also asked whether ETC anticipated the same progress in the years going forward depending less on cable franchise fee funding.

Mr. Donaldson stated that it is a goal of ETC to reduce its reliance on the Cable Franchise Board and the City.

Mr. Curry stated that any monies that are not spent for television related activity at the end of the City’s fiscal year go into the City General fund. It seems necessary to be careful to separate the PEG Capital grants, which are for only for public, education, and government channels.

Motion was made by Mr. Hiltunen, seconded by Mr. Nelson, to adopt the Indiana University Grant Agreement for Educational Access Programming as proposed. Motion carried unanimously.

The next item on the agenda was the Crowe Chizek proposal to conduct a1997 Franchise fee audit. Ms. Piety presented a letter from Lou Karrison quoting the fees to perform a cable television franchise fee compliance audit for Comcast and Time Warner for calendar year 1997. Both operators will be audited for one year, 1997,which is the first full year both operators have been operating under their renewed franchise agreements. The purpose of this audit is to look at how the cable operators are operating under the new franchise agreements and to assure the Board and the City that the appropriate amounts are being remitted as franchise fees.

Ms. Piety stated the letter from Mr. Karrison proposes a fee of $16,150 plus out of pocket expenses in the range of $3,400 to $3,800 in order to perform these services. The procedures would be similar to the procedures that were performed for the City for the 1993/94 audit, which is the last audit this Board authorized.

Mr. Curry stated for $20,000 or less the City can cover the audit of both operators under the agreement.

Mr. Hiltunen asked how often the City should audit the Cable companies.

Ms. Piety suggested three years intervals.

Mr. Curry stated that, since this is the first full year of the new franchises it would be good to set the baseline on which the Board is operating. He would prefer to get ground rules understood at the outset. Then maybe the Board can follow through on a annual, bi-annual, or every three year audit.

Motion was made by Mr. Hiltunen, seconded by Mr. Nelson, to accept The Crowe Chizek fee quotation to conduct a franchise fee audit for 1997 for both Comcast and Time Warner franchises. Motion carried unanimously.

The next item on the agenda was the ratification of City’s participation in the appeal of an FCC order concerning franchise fee pass throughs to subscribers. Ms. Piety stated that, following the Dallas decision in which the 5^th Circuit Court of Appeals found, contrary to the FCC that amounts attributable to franchise fees should be included in gross revenues, and the cable operators have an obligation to pay franchise fees on those amounts, the NCTA filed with the FCC for clarification of the franchise fee policy. It asked the FCC to clarify the regulatory treatment of the franchise fees that were due subsequent to the Dallas decision. Ms. Piety stated the FCC issued an order which said the operators were allowed to pass through the franchise fees to subscribers, but from the municipalities point of view, the order was unclear as to exactly how operators could qualify for the pass through.

Ms. Piety stated the deadline for asking the FCC to clarify its order was April 1, 1998. After sending out a proposal from Miller & Van Eaton to file a motion on behalf of the City, as a part of a municipal coalition, Ms. Piety notified Miller & Van Eaton the City would participate in an amount not to exceed $500.00.

Motion was made by Mr. Leonard, seconded by Mr. Nelson, to ratify the City’s participation in the motion to reconsider in an amount not to exceed $500.00. Motion carried unanimously.

Mr. Leonard left the Board meeting.

The next agenda item on the agenda was the Cable Agency Report. Mr. Maultra presented the Cable Agency report which highlighted the events that have taken place at the Cable Agency in the last month. Peggy Piety and the Cable Agency participated at the March 27^th Indiana Association of Cities and Town’s Telecommunications Task Force. At that meeting, the ramifications of the Indiana General Assembly’s recently passed Right of Way Act were discussed and how the new law affects the Model Right of Way Ordinance that the Task Force has been working on for the past year. There was also discussion as to whether to make this Model Ordinance one that purely pertains to telecommunications or to make it all encompassing to cover all players in the rights -of-way. The Agency strongly recommended a general ROW users ordinance be forwarded, considering the time spent on the document heretofore.

The Agency filed a letter to the FCC that spoke to preservation of local authority on zoning issues regarding Personal Communication Services, Radio, and TV Broadcast Towers. The same letter also spoke in support of preserving local franchising of cable companies no matter how they arrange or rearrange the ownership of their lines in the streets. The Cable Agency was contacted by President of NATOA last week in preparation for some upcoming talks at the FCC. The Cable Agency has worked with both cable operators in mediating a number of customer cable problems with a summary and breakdown of the problems. Mr. Maultra stated an increasing concern that the Agency is hearing from subscribers is over reaching someone to talk to at the cable companies. The Agency is also receiving complaints about customers being shuttled through what seems to them to be an endless string of recordings and hold delays.

The next item on the agenda was the Channel 16 Programming Report presented by Mr. Montgomery. Mr. Montgomery highlighted some of the activities of Channel 16 for the month of March. In March there were 29 hours and 51 minutes of live meeting coverage. Tape Delay meetings totaled 5 hours and 8 minutes. Special Events Production totaled 8 hours and 24 minutes.

In the area of In-Kind Production, Channel 16 had 8 hours and 11 minutes of production. In references to Series Programming, Channel 16 had 6 hours and 30 minutes of production. The total for the month of March for all productions was 58 hours and 4 minutes. Interactive Information Usage totaled 982 calls for the month.

Mr. Montgomery stated that Channel 16 prepared a summer job PSA for Indy Parks, Indy Park contacted Channel 16 in cooperation with the Ad Agency. Channel 16 produced a PSA that was written by the Ad Agency.

The next agenda item was the Cable Operator’s Reports. Mr. Apple presented Comcast’s report. Mr. Apple stated that in March Comcast gained 218 customers serving 111,382 in Marion County franchise area. For incoming calls, Comcast had 88,391 calls; 70.86% of those were answered in 30 seconds or less. Comcast had 68 outages for the month, 5 of them were planned. Comcast received and scheduled 2,441 calls and completed 2,389; 68.1% were completed within 24 hours; 99.7% were completed in 36 hours. Comcast scheduled 3,132 installations and completed 2,821 of those scheduled.

Mr. Apple stated that during the month of March, Comcast had 42.5 hours of community interest programming aired on Channel 50. WAV-53 had 149.5 hours of locally produced programming. Comcast aired and produced 11 public service announcements. As for community events and sponsorships, Comcast hosted a Cable in the Classroom workshop March 3 for 50 teachers and parents at St. Simon the Apostle School on Oaklandon Road. On March 13^th Comcast sponsored "An Evening in the Garden", a preview reception at the Flower and Patio show. Comcast also was the television sponsor of the NCAA Indoor Track Championships, held March 13-14, at the RCA Dome. Comcast sponsored the 100 Black Men of Indianapolis’ African-American History Challenge for Middle School and High School students. Comcast donated cash to the Marion County Sheriffs "Just Say No" Fund. Finally, Comcast interviewed the following quests in March for upcoming Newsmakers segments: Sharon O’Morrow, Executive Director, Little Red Door Cancer Agency; Christie Love, Chairman of the Board, YMCA; Elaine Amerson, Vice President for Administration, Christian Theological Seminary; Anne Hathaway, Executive Vice President, Indiana Sports Corporation; Brenda White, Family Development Manager, The Villages Foster Care Placement. Mr. Apple also reported that the renovation of the local office is almost completed, and the switch over to the new headed occurred last week. Comcast completed one hundred thirty-five(135) miles of system upgrade in March, a record.

Ms. Shary Hoffman-Meadows presented the Cable Operator’s Management Report for Time Warner. Ms. Hoffman-Meadows stated that Time Warner during the month of March gained nearly 400 new customers. Time Warner completed 4,779 installs for the month of March. Incoming calls total for the month was 53,815; answering 91.9% within 30 seconds or less. Service calls total for the month was 4,004 calls; 96.7% of those calls completed within 36 hours. Ms. Hoffman-Meadows asked the Service Manager for an explanation why the number of calls that came in was less this month than last month and he stated it has a lot to do with the way calls come in. Time Warner is doing some construction in the Twin Hills unit which is not part of the upgrade. Ms. Hoffman- Meadows stated in regard to the upgrade, Time Warner has completed the downtown area and is hopeful the upgrade completed in November 1998.

The Community Involvement report supports a lot of different community events and programming in the year, including producing and running 30 second promotional spots for The Phoenix Theatre’s production of Durang, Durang, and the Indianapolis Opera’s production of Cinderella.

Mr. Curry asked whether 190 miles of poles are these poles shown in the report owned by Time Warner.

Ms. Hoffman-Meadows stated these poles are rented from IPALCO or another utility company.

Mr. Curry asked whether Time Warner has pole contracts with AT&T or Ameritech.

Ms. Hoffman-Meadows stated Time Warner has contracts with Ameritech.

Under Old Business, there was nothing to report.

Under New Business, Mr. Maultra stated in regard to the Comcast and Time Warner monthly reports, that Comcast has a 4.63% of its calls abandoned after 3O seconds compared to Time Warner compared that had 5/10% of 1 percent for the Month. Mr. Maultra wondered whether Comcast had an explanation as to why they were up from the previous month.

Mr. Curry stated he noticed those number and the number of seconds to answer and stated he thought this would be a good project for the Cable Agency to review.

Under Public Comment, Mr. Donaldson with the Educational Television Cooperative, publicly acknowledged and thanked both cable operators for working with the engineer staff at IUPUI. Mr. Donaldson stated the results of the quality issues for the EPS channel. With cooperative work from the cable operators and the engineer staff at IUPUI, the quality issues have been resolved. Mr. Donaldson also asked whether it would be appropriate for ETC to submit another Capital Equipment grant request in May.

Mr. Curry stated that the Board would hear ETC’s proposal whenever ETC was ready.

Mr. Smashey stated that he has been appointed as a member of the board for Public Access Inc PAI. Also, Mr. Smashey stated that PAI has tentative approval from the IRS for 501-( c ) (3) status. Mr. Smashey reiterated a past question from Andrea Price asking for a response on the issue of candidates for City County Council having some time on Channel 16.

Mr. Curry stated that City-County Council candidates will not be running until 1999. Mr. Curry stated this year there are some county offices, all the members of the Indiana House of Representative’s and approximately half of the Indiana Senate running for election. Mr. Curry stated he has not asked Mr. Carter, the City’s Corporation Counsel, for an opinion on this issue, but he will do so.

There being no other business to come before the Board, Mr. Curry adjourned the meeting at 4:30 P.M.

____________________________
Mr. Carlton Curry, Chairman

____________________________
Mr. Charles Hiltunen, Member

____________________________
Mr. David Leonard, Member

____________________________
Mr. Steve Nelson, Member

____________________________
Mr. Stuart Rhodes, Member

ATTEST:

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Ms. Janise Winston, Recording Secretary