Council Grants Cable Company Extension To Finish Construction

July 03, 1991|By James M. Coram | James M. Coram,Staff writer

The County Council voted unanimously and without debate Monday to give Mid-Atlantic Cable Co. another 18 months to finish the 30 miles ofconstruction in the western and central areas of the county that thecompany was supposed to have completed a year ago.

Even with the extension, the company will increase rates by about $5 a month in September because apart from subscriber fees, "there is no other source"of construction money, said John C. Norcutt, Mid-Atlantic's general partner.

Subscribers now pay $14.95 a month for basic 22-channel service, or $20.95 a month for 56-channel service that includes Home Team Sports. It does not include live broadcasts of the county's government, education and public access channels.

The council gave the financially troubled cable television company until Dec. 31, 1993, to installa system allowing it to carry those channels live instead of on tape. The deadline for completing construction is Dec. 31, 1992.

Monday's vote marked the second time the council has granted the company an extension.

The three-year-old franchise agreement originally called for providing cable television service to 71 subdivisions by July9, 1990.

The council extended that deadline until the end of lastyear, but only 61 subdivisions have been hooked up.

Norcutt told the council last week that financial woes -- the recession, a nationwide devaluing of cable franchises, a local building moratorium and increased costs resulting from increasing the system's channel capacity-- have kept the company from meeting its original deadlines.

Financial records furnished to the council June 10 show the company had a net loss of $406,325 in 1990 and a net loss of $88,836 the previousyear.

Records shared with the council show that the company has run 190 miles of cable past 4,580 houses and has attracted 2,550 subscribers. In 1990, 94 subscribers dropped the service, including 54 whomoved or did not pay their fees.

The company said it corrected 52of 65 problems customers had written to the company about in 1990.

The other 13 complaints were about increased rates, the company said.

Cable administrator James O'Connor told the council last week that the fact that Mid-Atlantic spent additional money to increase itschannel capacity "should have no bearing" on the company's failure to complete the system within the original deadline.

O'Connor also urged the council to discount Norcutt's testimony that the company has exceeded the number of homes proposed in the application and that it has constructed more cable than originally called for.

The franchise agreement was to build not for a certain number of homes, but for a certain number of subdivisions, O'Connor told the council.

As for the laying of additional cable, that was due to "poor pre-engineering," O'Connor said.

But the council seemed to agree with Darrel E. Drown, R-2nd, who said before casting his vote that the question of how Mid-Atlantic found itself in financial difficulty is irrelevant.

"Bad forecasting? Bad management? I'm not sure. But they are (now) heading in the right direction," Drown said.

The council could have fined the company $300 a day for its failure to meet its construction deadline and $100 a day for its failure to meet its deadline for broadcasting the county government, public access and educational channels live.

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