From the Statehouse 2007 No. 20
by Jennifer Garrison
Aug. 23, 2007
FROM THE STATEHOUSE- August 23, 2007
In June, the Ohio House passed Substitute Senate Bill 117, setting the stage for competition among cable video providers throughout the state. A number of telephone companies, like AT&T wanted to enter the video service market and compete with cable providers. Cable providers currently are issued local licenses, or franchises to provide the service within a municipality or township.
Substitute Senate bill 117 authorizes the Ohio Department of Commerce to issue licenses to qualified video service marketers who wish to offer their services statewide. This eliminates the current practice of obtaining permits in each city and township in which they do business. Understandably, this raised concerns among local elected officials, as it did with me when the bill was initially presented to House members for consideration.
Because of the efforts of the House Public Utilities Committee, Substitute Senate Bill 117 was made considerably better in the House compared to how it came out of the Senate. The legislation strikes a balance between consumer desire for reasonable cable rates and local control. The bill now provides many of the protections requested by local officials while still enhancing competition and consumer choice in video services.
Specifically, Substitute Senate bill 117, requires current Video Service franchises to continue until their scheduled expiration. The Senate passed version allowed every cable company out of their contract regardless of whether competition existed. Cable providers under a current franchise agreement can apply for a new Video Service Agreement (VSA) after their current VSA expires or once there is competition. The competition trigger occurs when a competing provider begins to provide service in that area. The goal is for competition to be created around the state, which can result in more consumer choice, lower prices and better customer service.
Currently, local municipalities, receive a percentage of revenues from the cable provider as their fee in exchange for the franchise agreement and use of the public rights of way. Under the new state agreements, the Video Service Providers (VSP) must pay a quarterly fee to each municipality or township. The fee is capped at 5% of VSP gross revenue. The gross revenue includes monthly charges, event-based charges (pay-per-view), activation, installation, repair, and box rental charges, and administrative charges.
Further, municipalities and townships may choose to include advertising revenue as part of gross revenue. The municipality or township must adopt or enact legislation to obtain this revenue. Municipalities and townships decide the fee percentage, up to 5%. The bill also authorizes municipalities and townships to conduct annual audits to verify the VSP fees are accurate.
If a municipality or township currently has 3 or more Public, Education, or Government (PEG) channels, a VSP must continue to provide those channels. Three (3) must be provided on the basic service tier. If a municipality or township currently has 1 or 2 PEG channels, a VSP must continue to provide that channel with at least 1 on the basic service tier.
In regard to customer service, Substitute Senate Bill 117, requires VSPs to meet the following customer service standards:
Restore service within 72 hours of reported outage (exception for natural disasters);
Provide credit if service is interrupted by VSP for more than 4 hours;
Provide credit if service is interrupted for any reason for more than 24 hours;
Disconnect service for nonpayment of bill only if at least 45 days past due.
Finally, the VSPs must assist with subscriber complaints at the request of municipalities and townships.
This will allow local governments to assist with local complaints. I supported this bill and voted “yes”. The Governor signed the bill June 25, 2007 and will become law September 24, 2007.
You can reach Jennifer Garrison at her Columbus office at 614-644-8728 or in the district at 740-373-2414 or by e-mail at jennifer@jennifergarrison.com. Her website is Riffe Center | 77 South High Street | Columbus Ohio 43215-6111 | (800) 282-0253 | District93@ohr.state.oh.us
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