Council OKs Transfer Of Adelphia to Time Warner:

The Santa Monica City Council approved the transfer of Adelphia Cable, which has held the cable television franchise in Santa Monica since its purchase of Century Cable some years ago, to Time Warner Incorporated, at its last meeting. According to Kathryn Vernez, Assistant to the City Manager for Government Relations, this is part of the process of “Adelphia emerging from bankruptcy.” The City staff report states, “Adelphia filed for bankruptcy protection on June 25, 2002 as a result of significant financial fraud by management of Adelphia. Adelphia has proposed a Plan of Reorganization whereby the assets of Adelphia will be sold to Time Warner and Comcast. Time Warner and Comcast have also agreed that they would swap systems across the country as part of the agreement to purchase the assets of Adelphia. The proposed corporate ownership of the City’s franchise will be one of several newly formed companies which have been formed solely for purposes of the Adelphia sales transaction.”Vernez told the Mirror that the companies are working to make the transfer “as seamless as possible for cable customers.” The deal is expected to close by the fall of this year. but the “timing is being controlled by the necessary federal approvals from the Federal Communications Commission (FCC), the Federal Trade Commission (FTC) and the bankruptcy court.According to Vernez, costs associated with the proposed transaction will not result in an increase in subscriber rates. “The City regulates basic cable rates, not the upper tiers or the internet.” They are controlled by the FCC.The City’s utility taxes and fees will be unchanged, and will continue to be paid by subscribers to the cable company and passed on to the City.Vernez also said, “Time Warner has a good reputation in Los Angeles.” It has told the City that “customer service is number one on their agenda. The City will be provided with a company liaison to resolve customer service issues and complaints.” According to the staff report, “The settlement resolves all outstanding financial claims of the City with the City receiving $950,000. Of that amount, $63,152.16 is payment for Adelphia’s FY 2005-06 business license….the City’s interest is to ensure the Franchisee’s ability to perform, and to guarantee the performance itself, i.e. to ensure that service is not suspended or degraded, that facilities on the public right of way are well-maintained and comply with all applicable codes and that the construction in the public right-of-way is not disrupted or delayed because of financial problems, or lack of financially qualified parent guarantees.” In a related matter, Adelphia’s latest bills, which were mailed in mid-February, included a notice of rate increases that will go into effect with the March billing. Most monthly rates will increase by $1, with “multi-channel premiums”” increasing by $2. Starz on Demand, which has been free, will now cost $1.95 a month. Adelphia customers with questions should call (866) 241 2845.