Atlanta Council Bullied by Comcast, Ignores $216,000 in Overbilling
(APN) ATLANTA — Comcast Cable got their way, with a unanimous vote of the City Utilities Committee of the Atlanta City Council on November 26, 2019; and by the Full Council on December 02, 2019, in support of 19-O-1598, approving a seven year Franchise Agreement with the City of Atlanta.
Numerous advocates, as well as the Atlanta Planning Advisory Board, opposed the Council’s adoption of the contract, especially while the City is still auditing Comcast.
NO COUNCILMEMBER GAVE A DARN ABOUT 216,000 DOLLARS IN FRAUDULENT OVERBILLING
Atlanta Progressive News revealed troubling information about Comcast in November: that the company overbilled customers by approximately 216,000 dollars from 2009 to 2016 in “PEG Fees,” or Public, Educational, and Government public access fees, which they kept for themselves, calling the money “interest.”
Comcast was allowed to reimburse themselves for a five hundred thousand dollar payment to support PEG station People TV Atlanta made in 2009, by collecting ten cents per month from subscribers. But instead, Comcast collected 716,000 dollars, calling the profit “interest.”
Comcast did not appear to have any contractual authority to collect the 216,000 dollars in interest, at a usurious rate of at least twelve percent, according to APN’s calculations. Moreover, Comcast appears to have defrauded customers by describing the collection as “PEG fees” rather than “interest.”
City Utilities Committee Chairman J.P. Matzigkeit apparently did not care, as he asked no questions about this usury and fraud.
Neither did anyone on the committee or the entire City Council, despite reports in Atlanta Progressive News and despite concerns raised in public comments by APN’s News Editor and other advocates.
Nor did the Committee or Council raise any concerns about Comcast’s collection of 2.1 million dollars from ratepayers to reimburse itself for costs related to its relocation of wires due to the Atlanta Streetcar. It’s not clear how Comcast was authorized to collect those funds from ratepayers, rather than by making a claim to the City of Atlanta.
An Atlanta attorney who subscribes to APN has reached out to APN regarding the controversy, and we are currently exploring litigation in this matter.
The three year statute of limitations on the matter only recently began to run, when Comcast admitted to the collection of interest and the collection of Streetcar relocation money during a November Public Hearing.
BULLYING BY COMCAST TO TAKE AWAY PUBLIC ACCESS CHANNELS
Comcast had threatened the City of Atlanta to take away two of the City’s five current public access channels, by going to the State of Georgia for a Franchise Agreement pursuant to state law, if the City did not approve the contract by Dec. 02.
However, APN reported that state law appears to require that Comcast provide the number of public access channels that already exist at the time that Comcast and the State would have entered into an agreement. Atlanta currently has five channels.
O.C.G.A. 36-76-8 provides: “No cable service provider or video service provider shall be required to provide more than three PEG access channels on its network within a municipality or unincorporated area of a county if there does not exist at the time of the state franchise more than three active PEG channels in such municipality or unincorporated area of the county.” (emphasis added)
A reasonable reading of this statute suggests that it means that if there does exist at the time of the state franchise more than three active PEG channels, that the cable provider shall be required to provide that number of channels. Surely, it could have been written more clearly by the Legislature, but it would be absurd to read the statute any other way.
City Attorney Nina Hickson, who presented the contract to City Utilities Cmte, disagreed, however.
“If Comcast were to go with the State Franchise… there is a debate about interpretation of what channels, how many channels we would be entitled to–and there is a debate,” Hickson told the Committee.
“We don’t agree with Mr. Cardinale’s opinion on that,” Hickson said, referring to APN’s News Editor.
“But we also got a differing opinion from our telecom outside counsel, which is even more conservative than the position we take,” Hickson told the Committee.
Hickson did not explain to the Committee how or why there was a debate about the statute, nor did the Committee ask.
However, it appears to have to do with the fact that the statute does not affirmatively state–even though it clearly implies to any reasonable person–what happens when a city already has more than three PEG channels.
The Law Department was unwilling to advocate for a non-absurd reading of the statute.
AUDIT IN PROGRESS, COUNCIL FAILS TO ADDRESS HOLES IN AUDIT LANGUAGE
APN reached out to the City Auditor to express concerns about Comcast and to learn more about the audit that is currently underway, and that will not be complete until at least February 2020.
The Auditor expressed concerns regarding audit language in the contract that speaks to the authority to audit “franchise fees,” because it is not clear whether “franchise fees” includes PEG fees, random reimbursements for claims like the Streetcar relocation, or interest on a loan to the City of Atlanta.
This was expressed to the Committee, but no one cared.
The audit is likely to include recommendations about how to improve oversight of Comcast, and also raise issues regarding the contract’s audit provisions.
Unfortunately, due to the Council’s actions, the City of Atlanta will be unable to implement any recommendations or make any changes based on the audit until the next Franchise Agreement in 2026.
Advocates were able to secure one amendment to the agreement, which removed troubling language that would have undermined the City’s ability to audit Comcast’s collection and payment of franchise fees that had occurred prior to January 01, 2018.
The amended language now allows the City to audit back three years, or to 2017.
NEW LEGISLATION TO FUND PEOPLE TV ATLANTA
On a more positive note, Councilman Michael Julian Bond (Post 1-at-large) has introduced an ordinance, 19-O-1726, to establish a Trust Fund for People TV Atlanta Channel 24, to receive a percentage of the millions of dollars in franchise fees received from Comcast each quarter.
People TV Atlanta has a great need for funding, including to upgrade its outdated equipment.
Atlanta Progressive News has a show on People TV every Wednesday night from 6 to 7p.m., with the new season beginning in January 2020.
Currently, People TV Atlanta has no dedicated stream of revenue from the City, and has received a little over a hundred thousand dollars per year from the General Fund, at the annual discretion of the Council.
Meanwhile, Comcast collects millions of dollars per year from subscribers through “franchise fees,” equaling an added five percent of the cable bill.
Mr. Bond’s ordinance would ensure that a dedicated portion of those fees support public access every year.
While Comcast will bill customers an additional four hundred thousand dollars in PEG fees over the next seven years, the City has to use this money to support all five stations and can only be used for capital, not operations. The PEG money is thus insufficient and additional support is needed.
The City Utilities Cmte will be hearing the People TV funding legislation on Tuesday, Dec. 10, 2019, at 9:30 a.m., at the last Cmte meeting of the year, at City Hall, Cmte Room 1.
(END / Copyright Atlanta Progressive News / 2019)