Cable giant, panel reach a tentative settlement

Adelphia agrees to pay commission over $100,000

Carroll County

April 08, 2004|By Hanah Cho | Hanah Cho,SUN STAFF

Carroll County's cable commission has reached a tentative settlement with Adelphia Communications Corp. to resolve an ongoing dispute over unpaid franchise fees.

Adelphia has agreed to pay $97,500 in additional franchise fees plus interest and another $25,000 to cover a commission-ordered audit that initially found that the nation's fifth-largest cable provider owed more than $200,000 in outstanding fees.

"We feel that this is an important sign that Adelphia is willing to deal constructively with the commission," said Ken Decker, chairman of the Carroll Cable Regulatory Commission.

The eight-member commission is expected to vote on the settlement, reached last week, at its meeting next month, Decker said yesterday.

But the agreement does not negate the commission's intentions to pursue legal action against the cable company for breach of contract.

Still, Kristy Hall, director of governmental affairs for Adelphia's central region, called the settlement a positive step.

"It's funny when you walk away from negotiations, people's versions change," Hall said, noting that Adelphia does not admit that it owed any unpaid franchise fees. "Subsequently, in discussions and e-mails, we're on the same page. That's great."

An independent audit ordered by the cable commission found that Adelphia owes Carroll County $220,000 in unpaid franchise fees accrued over two years, ending March 2002. But since the audit was released in September, auditors have readjusted and lowered the amount between $40,000 and $50,000, based on new information provided by Adelphia, Decker said.

"When we adjusted it down, we settled for slightly less than what we thought they owed us," Decker said.

"We came away with almost $100,000. ... We still negotiated a deal that was in the interest of both parties," he said.

Adelphia entered into a franchise agreement in 2000 to provide cable television service in the county. The company, which filed for Chapter 11 bankruptcy protection in June 2002, serves about 20,000 Carroll County customers.

Under the franchise agreement, the county and its municipalities, except Manchester, receive 5 percent of the fees that subscribers pay for cable television. The county uses the money to pay for local-access television.

In 2003, Adelphia paid about $1.05 million in franchise fees, according to the commission. Manchester is not part of the franchise agreement.

Other differences linger between the cable commission and Adelphia.

In late 2001, county officials sought $30,000 in sanctions from a performance bond that is part of Adelphia's contract with the county for customer service concerns. Negotiations are continuing, Decker said.

The latest dispute involves disagreements over whether the commission can request a technical audit of the cable system and renegotiate its 10-year franchise agreement with Adelphia. Commission members, who say the cable provider is not adhering to the contract, voted to pursue legal action last month.

Both parties expressed cautious optimism yesterday that the recent settlement would lead to other resolutions.

"What you always try to look for in situations like this is, what is the trend?" Decker said. "Are things getting better? If you're able to resolve one thing ... it leads one to believe that maybe other things could be settled, too."

Said Hall: "At the end of the meeting [last week], both sides expressed interest in using this momentum and working together to address other issues."

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