April 19, 1999

City County Building
Indianapolis, IN 46204

MEMBERS PRESENT:

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

OTHERS PRESENT:

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

The Board consented, due to not having a quorum, to address those items on the agenda that did not require a vote first. The Board also consented to moving Item 9a. to combine with the ETC monthly report, Item 7.

The next item on the agenda was the status report of the Audit of Cable Operators. Ms. Piety stated that she received from Mr. Karrison the preliminary report of his audit of both Cable Operators for calendar year 1997. Ms. Piety stated that copies of the reports have been provided to both cable operators for their review and comment, with the final report presented to the Board in May.

The next item on the agenda was the Status Report of Review of operator rate filings. Ms. Piety stated Mr. Karrison has provided her with preliminary reports which she will turn into rate orders. Ms. Piety stated she will try to have these order’s available for the May meeting.

The next 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. Mr. Maultra stated the Cable Agency has discussed possible non-compliance issues with Comcast and they have asked for an extension to respond. The Agency had some informal discussions with Comcast. Time Warner responded in writing to the Agency’s request to address same and the Agency is satisfied with their response. The Agency also had discussions with counsel regarding the non-compliance audit that they performed.

The Agency reviewed the public purpose grant agreement for the Educational Television Consortium, known as ETC, and found that in order. The only real change in this document from years before is that the Controller’s Office requested a deadline of July 31, 1999 for the funds to be spent. The amount of this grant is $30,000 and it comes out of the Cable Agency budget.

Recently the Agency circulated articles to the Board relating to the proposed acquisition of media one cable systems by Comcast. The amount of the acquisition is nearly 60 billion dollars which exceeds the recent acquisition of TCI, the nation’s largest cable operator, by AT&T. While Comcast subscribers should see no immediate effects of this acquisition, the Cable Agency has some concerns regarding potential local competitive scenarios. Media One owns 25% of Time Warner Entertainment. That will translate into Comcast owning 25% of Time Warner Entertainment.

The Agency has made many new additions to its web site and is planning to do some overhauling of the site so it’s easier to use.

The Cable Agency attended the CASPER Award ceremony sponsored by the United Way that honored one of its producers, Alan Dhayer, for his production of Crackback : One Neighborhood at a Time that was produced in partnership with the Prosecutor’s Office. The Agency also attended the City-Council meeting that further honored Mr. Dhayer’s work with a special Council Resolution thanks to Chairman Curry. Ken Montgomery may want to prove some more details of the CASPER Award and the production itself.

The Cable Agency has worked with both cable operators with a summary and breakdown of problems attached to the Agency report. Time Warner had a total of 74 complaints for the month, and Comcast had a total of 87 complaints.

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 39 hours and 15 minutes of live meeting coverage. Tape Delay meetings totaled 5 hours and 37 minutes. Special Events Production totaled 19 hours and 20 minutes. Mr. Montgomery stated that in In-Kind services totaled $7587.50 in provided services

In the area of In-Kind Production, Channel 16 had 11 hours and 10 minutes. Series Programs totaled 7 hours. Total new production for the month of March was 82 hours and 22 minutes.

Mr. Montgomery stated in reference to additional notes that Alan Dhayer of Channel 16 received a CASPER Award from the Central Indiana United Way for his work on Crackback: One Neighborhood at a Time. Also, Channel 16 has been selected as the U.S. Small Business Administration’s 1999 Media Advocate of the year for the State of Indiana. An awards dinner will be held on June 3^rd at the Indiana Roof.

The next agenda item was the approval of minutes for the Cable Board’s March 15, 1999, meeting. Motion was made by Mr. Rhodes and seconded by Mr. Leonard, to approve the minutes of the Board’s March 15, 1999, meeting. Motion carried unanimously.

The next agenda item was the Cable Operator’s Report. Mrs. Shary Johnston presented the Time Warner Report. Mrs. Johnston stated that Time Warner has gained in its customer base of 149 subscribers. Mrs. Johnston stated that Time Warner completed 3,296 installs for the month of March with 4,095 scheduled. Incoming calls for the month were 47,686 with 90.0% answered in 30 seconds. Busy rate 1.77%. Service calls for the month were 1,755 scheduled and 1,710 completed. Time Warner planned 3 outages for the month and there were 53 unplanned outages. Average customers per outage was 122.

The Community Involvement report supports a lot of different community events and programming, including producing a 60 second commercial to inform customers about Channel 9 digital ingress. Time Warner hosted a dinner for key educators from the franchise area to determine program content for this year’s Great Lakes Cable Expo Educators Session. Al Aldridge assisted the 100 Black Men of Indianapolis in greeting NCAA visitors to the city. See Community Involvement Report.

Mr. Apple presented the Cable Operator’s March Management Report for Comcast. Mr. Apple stated that Comcast will have some channel changes in the next few weeks, which will effect the digital customers only. HBO is replacing two of the Cinemax mountain time zone feeds on the digital offering with a new HBO network called HBO Zone. Mr. Apple stated effective May 5^th , HBO zone east replaces Cinemax mountain on channel 224 and HBO zone west will replace more Cinemax mountain on channel 228. On June 1^st , Mr. Apple stated that HBO will launch another network called HBO comedy and digital customers will be able to receive HBO comedy east on channel 305 and HBO comedy west on channel 310, which replaces HBO mountain and HBO 2 mountain respectively . Mr. Apple also stated that on June 1^st ,the pay per view network adult vision will become Spice. Comcast will also realign the digital line up on June 1^st. Mr. Apple stated that Comcast has announced the merger with Media One and the closing of the acquisition of Jones Intercable.

Mr. Apple stated that Comcast had a good month with the subscriber growth in March, a gain of almost 600 full basic customers. For incoming calls, Comcast had 119,262 calls; 65.16% of those calls were answered in 30 seconds or less. Comcast had 55 outages for the month, 0 of them were planned. Comcast received and scheduled 2031 calls and completed 2009; 58.5% were completed within 24 hours; 100% were completed in 36 hours or by customer request. Comcast scheduled 3,427 installations and 3,230 of those scheduled were completed.

Mr. Apple stated that during the month of March, Comcast had 37 hours of community interest programming aired on Channel 50. WAV 53 had 159 hours of locally produced programming. Comcast aired and produced 17 public service announcements and 17 newsmaker segments. For Comcast events and sponsorships; see report.

The next item on the agenda was the ETC Report. Mr. John Burkeholder presented the ETC report. Mr. Burkeholder stated that ETC is seeking its ninth public purpose grant in the amount of $30, 000 and the appropriation portion of that has been discussed. ETC is looking for the Board approval on that grant. Mr. Burkeholder also stated that IU has reviewed the contract and is preparing the necessary documentation to deposit the funds once they are approved. Mr. Burkeholder stated that in March ETC had 0 hours of paid programming 382 donated programming hours and 316 hours of Recovery Network which has met with great response from the community.

Mr. Curry asked Ms. Piety in reference to the grant agreement whether there is any action necessary other than the Board hearing it.

Ms. Piety stated the appropriation that would support the grant agreement was approved by Council Rules and Public Policy committee on April 6^th and will go in front of the full Council for passage on April 26^th . Ms. Piety stated if the Board chooses to do so, the ETC grant could be approved by the Board today contingent upon the Council’s approval.

Motion was made by Mr. Hiltunen and seconded by Mr. Rhodes, to approve the grant agreement upon contingent of the Council approval of the grant. Motion carried unanimously.

The next item on the agenda was the discussion of the PAI Business plan.

Under Old Business, Ms. Ann Lathrop, the Controller, addressed the PAI business plan and its funding. Ms. Lathrop stated she did some research in regard to the Cable Franchise Fee. Ms. Lathrop stated the expenditures compared to the revenues and the anticipation that in 1999 the cable fees would add about 2 1/2 million dollars to the general fund for the City. Ms. Lathrop stated in the overall consolidated county fund this amount represents almost 7 percent of the support of the actual expenditures in that fund. Ms. Lathrop stated the fund helps fund the Controllers office and Mayor’s office and City Legal and Department of Administration and the Council and matches for the City grant funds where local dollars are needed. Ms. Lathrop stated there is quite a few uses for these funds and the Consolidated County is the most flexible revenue source. There are always requests for funds and this fund would be used for those emergency cases.

Mr. Curry asked if this fund is classified as a misc. revenue to the City General and how many years are planned as firm revenues or probable revenues that are rely upon these funds.

Ms. Lathrop stated the City tries to have a 5 year plan at all times, and there is a 2 percent difference in the years.

Mr. Curry asked Ms. Lathrop whether from her perspective the fact that cable rates have gone up a bit more than normal inflation is a benefit to the City revenue.

Ms. Lathrop stated yes. Ms. Lathrop also stated given the time of the year that monies in this funded source have allocated uses.

Mr. Curry stated, with respect to other uses or dedicated uses, that he is aware that the sum of money which is transferred to the Capital Approvements Board comes from the this revenue stream.

Ms. Price asked in terms of the monies sey aside in the Consolidated County fund how that money is part of the budget process and how she would reconcile that with the monies in the budget for franchise fees .

Ms. Lathrop stated there are schedules in the budget book that show where the Consolidated County funds are budgeted compared to each agency.

Ms. Price asked how much is budgeted in franchise fees for the year.

Ms. Lathrop stated 3.5 million dollars is scheduled to come in this year also stating the City is in the process of putting the budget together for next year so the amount would go up about 2 percent.

Ms. Price asked if the extra 22 percent of the franchise fees is surplus.

Ms. Lathrop stated you have to look in her revenue report for any surplus.

Ms. Price stated there is a projection for surplus. Ms. Price also asked how monies that are returned to general fund from the Cable Agency are used.

Ms. Lathrop stated the monies support about 7 percent of other types of expenditures within the Consolidated County fund; such as matches for federal and state grants, City Legal, Mayor’s office expenses.

Ms. Price asked how the uses of the Consolidated fund are decided.

Ms. Lathrop stated they are decided through the budget process. The entire City budget is put together in multiple funds and is presented to multiple Council committees during the August and September time frame.

Mr. Curry stated that, once it goes to the committee process, the council adopts the annual budget and then any changes in appropriations during the year require a fiscal ordinance.

The next item on the agenda was the discussion of RFI. Mr. Curry stated the question before the Board is the use of Educational channel. The Board needs to decide to put the RFI out as is or whether there are modifications to the RFI.

Mr. Leoanard asked whether the RFI could be modified to include public access.

Mr. Curry stated the only action for this channel at this time under these franchise agreements would be educational or government use. Mr. Curry stated that there is no government use at this time, that he is aware of. Mr. Curry stated as long as public safety and educational are sharing a channel, there is one blue screen available.

Mr. Hiltunen stated that since public access is requesting a channel, it would be a good idea to resolve the public access questions before doing anything with this channel.

Motion was made by Mr. Leonard, seconded by Mr. Nelson, to table consideration of the RFI to the June 21^st 1999, Board meeting. Motion carried unanimously.

Under Public Comment, James Smashey stated he would like to see the RFI channel

go to PAI. Mr. Smashey also stated he is not happy with the City’s progress in getting video competition in the City. He also asked that Comcast do most of the publicity for the changes in the channel line-up.

There being no other business to come before the Board, Mr. Curry adjourned the meeting at 3:35 P.M.

_______________________________
Mr. Carlton Curry, Chairman

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Mr. Charlie Hiltunen, Member

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Mr. David Nelson, Member

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Mr. Steve Nelson, Member

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Mr. Stuart Rhodes, Member

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Ms. Janise Winston, Recording Secretary