After realizing there were dump truck-sized holes in the city’s new franchise agreement with Insight Communications, the Louisville Metro Council voted to send the ordinance, which granted the cable television and Internet provider an unprecedented degree of autonomy, back to the committee that spawned it.
In an interview with LEO Weekly, Democratic Caucus spokesman Tony Hyatt said that the Jefferson County Attorney’s Office “has some reservations” about a city bill that approved a 15-year franchise agreement with the cable television provider — which was unanimously passed out of the Transportation and Public Works Committee last week — in part because of Insight’s failure to comply with numerous provisions set forth in the existing franchise contract originally adopted by the then-Louisville Board of Alderman in 1996.
“It was one of those things that slipped through,” Hyatt said. “Some people on the council weren’t aware of how extensive their questions needed to be.”
Although the county attorney’s office declined to comment for this story, spokesman Bill Patteson confirmed that his office is “talking [with Metro Council] about issues with regard to the proposed legislation.”
In essence, the new ordinance extends the company’s franchise agreement with the city by 15 years, and includes perimeters for Insight’s operations in the city, such as Metro Government’s ability to regulate fees and equipment charges and bi-annual disclosure of audit-level financial statements, among others.
Except for one thing: The new ordinance will pretty much eliminate those things, and much, much more…
Before we go any further, it’s helpful to understand that the new ordinance, sponsored by Councilman Kevin Kramer, R-11, is designed to amend Louisville Metro Code of Ordinances Chapter 116, which governs Insight’s rights and abilities as a franchisee.
If passed, Kramer’s ordinance will eliminate:
1. Sections in Chapter 116 pertaining to Metro Council’s ability to regulate service and equipment rates, meaning that the city — and, by extension, Insight’s customers — won’t have any official input in the event the company decides to raise its rates.
2. The requirement that Insight carry a $5,000,000 million liability insurance policy for any copyright or patent infringement “in the transmission of materials through the cable franchise system.”
3. The disclosure of audit-level financial statements furnished by Insight to Metro Government, thereby eliminating any real financial oversight of the company on a local level.
4. Publication of shareholder information (e.g. names and addresses) for those Insight board members possessing more than three percent of company stock, as well as excising a related provision stipulating that Insight produce information pertaining to shareholders that have been convicted of “any crime which is in any way related to the operation and performance of a cable communications system.”
Furthermore, since Insight has seemingly failed to provide timely, up-to-date financial statements per Chapter 116′s subsections .41 and .42, Metro government may not be legally allowed to renew the franchise agreement.
According to a 2006 examination prepared by the Office of the Internal Auditor titled “Cable Television Issues,” Insight failed to comply with the required regular disclosure of its finances and other data related to its operations. The audit listed five criteria (financial reports, annual operating reports, rate filing, insurance policy and notification of change in ownership) that the company had failed to comply with, and recommended that Metro Government or the now-defunct Cable Service Commission should designate resources to ensure the responsibilities are adequately performed.
Little coincidence, then, that the documents Insight has had trouble scrounging up are the very documents this new ordinance will no longer ask them to provide.
The audit also listed several “non-compliance issues” in which the defunct Metro Cable Commission failed in its responsibility for holding Insight accountable amounting to a lack of proper oversight. City auditor Mike Norman informed LEO Weekly that his office had not been approached by any entity to review Insight regarding this latest ordinance.
“It’s the first I’ve heard of it,” Norman said.
Councilwoman Cheri Bryant Hamilton, D-5, chairs the Transportation and Public Works Committee and was out of town when the committee passed the ordinance last week.
“If I had been there, it wouldn’t have passed out of committee,” she said, “because it was on the heels of a public hearing. And I guess some of the members weren’t aware we’d [need] another meeting to discuss what came out of the hearing. They just kind of jumped the gun a little bit.”
Bryant Hamilton says her office just received a copy of the 2006 audit, and agrees that Insight hasn’t jumped through the right hoops to recieve a new franchise agreement. Regarding the ordinance itself, she says she needs to go over it “with a fresh set of eyes” because she failed to notice the section eliminating Metro Council’s ability to regulate service and equipment fees.
“I didn’t catch that,” she said. “I’m so glad we send this back to committee.”
Less than 48 hours before the issue was brought before the council, Insight forked over $5.8 million in delinquent personal tangible property taxes to the Metro government like a crackhead scrambling to keep himself in the good graces of his pusher, including $329,207.15 in penalties and $325,837.48 in delinquent fees. “Here’s your damn money,” Insight seemed to be saying. “Now hurry up with the smack.”
The only person interested in speaking about the ordinance was west Louisville resident Nancy DeMatra, who spoke during the council meeting’s public comment period. DeMatra read from a list of approximately complaints she had culled form friends and neighbors regarding spotty service, accidental service disconnection and mysterious rate hikes.
“Citizens need the opportunity in all areas to speak about Insight,” DeMatra said. “I hope that … people in each area of town — south, west and east — will have an opportunity to … have input.”
Hyatt said the council will most likely discuss the ordinance after the Thanksgiving holiday, and that an additional public comment period will not be held.