Town unite to negotiate cable TV deal

By Dawn De Busk

Staff Writer

NAPLES — There is strength in numbers.

At least five towns, and possibly more than ten municipalities, plan to work together to renegotiate Cable TV franchise fee contracts that have expired.

A renewed contract would ensure each town gets a higher percentage of fees paid to the town by the Cable TV provider. These “dividends” are paid out on a quarterly basis. Plus, with a new contract in place, a town would be able to upgrade the equipment used to tape meetings. 

Casco Town Manager Dave Morton updated the Casco selectmen on the renegotiation process during his manager’s comments on Tuesday.

“Charter Communications is the 300-pound gorilla in the room,” Morton said.

“It is tough to go it alone,” he said.

He added that when one town goes into contract negotiation with Charter Communications, the company comes up with a take it or leave it contract.

“We are thinking groups of towns will have a better opportunity to have some leverage going forward,” he said.

“The town should be able to collect 5% of the franchise fees. Currently, we are getting 2½%. That would double the money to town,” Morton said.

Charter Communications owns Spectrum Community, which is the regional cable television provider which acquired Time Warner Cable in May 2016, according to Wikipedia. Spectrum is the provider in Maine and northern New Hampshire.

The towns that have showed interest in creating a consortium and going toe-to-toe with Charter Communications are: Casco, Naples, Raymond, Harrison, Bridgton, Hebron, Minot, New Gloucester, Cape Elizabeth and Scarborough. Denmark and Fryeburg have also expressed interest.

Another plus of creating a consortium — besides having strength in numbers against a large company — is a cost savings during the negotiation process.

The more towns that are involved, the less each town pays a consultant for negotiations. This is a one-time fee.

According to Naples Town Manager John Hawley, “With more communities working together the negotiation rates drop.”

“For example, if three towns go in together it’s about $5,200 for each town but if we could get four or five towns, the rate is $4,200,” he said. “There is a renewed interest in communities to renegotiate, especially those getting 3%,” Hawley said. He added that the maximum is 5%, and that is the percentage that towns that have already renegotiated the contract are getting. 

“The franchise fee is the fee that the cable company pays to the community for delivering services to the community. It’s a percentage of what they take in for revenue based on the number of customers in the community,” Hawley said.

In January, Mike Edgecomb, with the James W. Sewall Company, headed a couple of informational meetings about the Cable TV franchise fee contracts. Tony Vigue, another advocate of towns renegotiating with the Cable TV company, was also at those meetings.

Edgecomb will be the consultant working on the behalf of the towns to create a new pact with Charter Communications. Edgecomb and Vigue “are both strongly suggesting now is a good time,” Hawley said.

The state’s legal authority is on the side of the towns, too.

“There is new interest at the Attorney General’s Office to enforce these agreements and legislation coming down the pipe that might also help the towns to get what was promised in the agreements,” he said.

Most likely, the renegotiations will take place after town meetings occur since the towns will have to budget for the costs associated with the negotiations.

“Town managers will report back to me after speaking with their boards and after budgets are approved,” Hawley said. “We will see how many communities are willing and dedicated to signing on next year.”

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