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HomeMy WebLinkAboutMinutes 83-12-05MINUTES OF AN ADJOURNED REGULAR MEETING OF THE CYPRESS CITY COUNCIL HELD December 5, 1983 The adjourned regular meeting of the Cypress City Council was called to order at 7:35 p.m. on Monday, December 5, 1983, in the Cypress City Council Chambers, 5275 Orange Avenue, Cypress, California, Mayor Otto Lacayo presiding. PRESENT: Council Members Coronado, Kanel, Lacayo, Mullen and Partin ABSENT: None Also present were Darrell Essex, City Manager, and Dave Barrett, Assistant to the City Manager. PLEDGE OF ALLEGIANCE: Councilman Kanel led the Pledge to the flag. ORAL COMMUNICATIONS: Mayor Partin asked if anyone present wished to speak regarding any matter other than the CATV Proposal Evaluatitm. No one wished to speak. ITEM OF DISCUSSION: CATV PROPOSAL EVALUATION: Mr. Essex summarized the history of CATV consideration in Cypress and reviewed the qualifications of Mr. Carl Pilnick, the City's CATV consultant, and the background of Dave Barrett, who developed the proposal and draft ordinance for the City. Mr. Barrett reviewed the staff report dated December 3, 1983, and presented a projected chart to demonstrate how a cable system works. He then reviewed a glossary of cable terms and discussed the priorities used for evaluation. Mr. Carl Pilnick of Telecommunications Management Corp. reviewed the evaluation criteria portion of his report and answered questions posed by the Councilmen. Mr. Barrett stated that, since neither proposal had been evaluated as far superior to the other, the staff primarily had attempted to indicate the weak points in each company's proposal so that the Council could discuss these areas with the applicants and make decisions as to how negotiations and/or bid enhancement procedure would be handled. RECESS: Mayor Partin called for a recess at 9:50 p.m. The meeting was reconvened in regular session at 10:05 p.m. with all Council Members present. Mayor Partin then announced that representatives of the companies would be allowed equal time for their presentation regarding their own bid and to comment on any aspect of the proposal of their competitor, followed by rebuttal by each. Mr. Roger Turner, President of Copley/Colony; Mr. Michael Isaacs, consultant, and Mr. Doug Truckenmi]ler, Director of Design and Technology, represented their firm, and stated the Cop]ey/Co]ony is willing to negotiate with the City regarding promotional and normal installation rates; that the company will comply fully with the construction requirements as outlined in the draft ordinance and guarantee their commitment to the construction schedule. They emphasized the greater capacity of an 80-channel, 550 MHz system over the 450 MHz, 65-channels offered by Group W; stressed the importance to the community of the 17 channels offered both upstream and downstream by Copley/Colony, the advantages of an independent, stand-alone system, and the value of the institutional network to the community for governmental, educational and home interaction with the system, and stated that they would be willing to negotiate regarding providing the Nashville Channel. Mr. Bill Rosendahl, Regional Director of Programming, Group W Cablevision, asked representatives of his firm to address the various points in which the two companies differ. City Council Minutes December 5, 1983 George O'Haneson, Director of Business Analysis, compared the financing and rate schedules proposed by the two companies and emphasized the financially desirable positien of their company in that it is a subsidiary of Westinghouse Electric and because its existing facilities, size and experience can offer continued lower rates and service costs to the subscribers. He stated that he feels Copley/Colony has underestimated the costs that they will incur in construction and operation of their proposed system and that this reflects a lack of experience in this field, which will result in higher rates to the consumer. Mr. Artie Ivy, Regional Director of Programming, emphasized the adequacy of Group W's proposed programming to meet the needs of the community and its ability to expand in the future. He expressed doubt that the true cost of adequate maintenance and personnel to provide the proposed services had been considered in the Copley/Colony proposal. Mr. Russ Botcher, Regional Director of Engineering, stated that a 450 MHz system was proposed because it has a proven performance record, whereas the 550 MHz system has not yet been installed and field-tested. Mr. Richard Wood, National Director of Special Services, discussed the differences in management philosophies of the two companies and emphasized that the Group W system is designed to meet the majority of the needs of the community now and will be expanded as the demand exists in the future. Councilman Lacayo asked for comments from each company, during the rebuttal phase, regarding the gross revenue that would be derived to the City from their respective proposals. Mr. Isaacs discussed the soundness of Copley/Colony's planned capital expenditures and financing techniques and stated that the company has never paid a penalty for failure to meet either construction or performance schedules and assured the Council that the entire system would be built with state-of-the-art equipment and in accordance with the terms of the proposal. He discussed new revenue streams and increased programming on both institutional and entertainment channels to generate more revenue, of which five percent would be paid to the City. Mr. Truckenmiller emphasized that the 550 MHz system proposed to be installed in Cypress would not be the first such system, but probably one of the first ten, and that field testing would be done in other areas prior to the Cypress installation. In response to a question by Mayor Partin, he stated that institutional channels could later be converted to entertainment. Mr. Wood stated that the Group W system provides every kind of two-way service that Cypress will need in the foreseeable future. In response to Councilman Lacayo's question regarding revenue to the City, he stated that, as there are new services and programming available, Group W would be involved in it and that the company's higher pro formas would create more revenue for Cypress. Mr. Barrett stated that there is little difference in the revenue projection to the City under the two proposals, but cautioned that any future changes which might be included in negotiation, including channel conversion, would naturally result in increased costs to the company. Mayor Partin then asked for comments from the Council Members. Councilman Coronado expressed his concern that Cypress College might not be able to participate to the extent intended and might not be able to appropriate adequate facilities for the Copley/Colony headend to be located there and asked the company to respond to this point in its final submission. He further asked both companies to comment on the possible use of the headend located at Los Alamitos Race Track. Dr. Kay Deaton, Associate Dean, Instructional Development, Cypress College, spoke regarding the advantages of addressing individual households and institutions in the community and indicated that this would be an essential element in future educational systems. Upon inquiry by Councilman Kanel as to whether any urgency is involved in awarding this franchise, Mr. Barrett explained that pending legislation before the House of Representatives, if approved, might usurp the authority of local governments to regulate CATV systems to the extent proposed in Cypress, but provisions were included for grandfathering of franchise conditions for systems in existence before its passage. O56 City Council Minutes December 5, 1983 After considerable discussion by the Council members, it was decided that the companies would be asked to submit any final responses and/or bid enhancements to the staff by Thursday, December 8, for further consideration at the Council Meeting of December 12, and that a tour would be arranged to allow the members of the Council to visit other areas where CATV systems are currently in operation. ADJOURNMENT: Mayor Partin adjourned the meeting at 1Z:JZ a.m. to 6:30 p.m. Monday December 1Z, 1983. MAYOR OF THE CITY OF CYPRESS ATTEST: CITY CLERK'o1~ THF~ITy OF CYPRESS. 3