HomeMy WebLinkAboutAdopt Resolution No. 2019-47 Approving the Withdrawal of thefiPPR[�/ED � O
City of Huntington Beach
File #: 19-761 MEETING DATE: 7/15/2019
REQUEST FOR CITY COUNCIL ACTION
SUBMITTED TO: Honorable Mayor and City Council Members
SUBMITTED BY: Dave Kiff, Interim City Manager
PREPARED BY: Antonia Graham, Assistant to the City Manager
Subiect:
Adopt Resolution No. 2019-47 Approving the Withdrawal of the City from the Public Cable
Television Authority
Statement of Issue:
On January 22, 2019, the City Council voted to authorize the City Manager to issue a six (6) month
Notice of Intent to Terminate Huntington Beach's membership in the Public Cable Television Authority
(PCTA) Joint Powers Authority (JPA) pursuant to Section 4 of the JPA Agreement. This Council
Action will formalize the City's Intent to Withdraw by adopting a Resolution Approving the Withdrawal
of the City from the PCTA.
Financial Impact:
The City currently finances 67% of PCTA's annual operating and Public, Educational, Governmental
(PEG) Access budgets. Additionally, the City also comprises at least 67% of PCTA's fund balances
and reserves based on similar historical contributions. Upon withdrawal, the City will begin to collect
100% of the franchise and PEG fees generated from Huntington Beach cable subscribers directly
from the cable providers. This amount is approximately $605,000 annually. These funds will be
deposited into a restricted fund which the City will oversee to fund our own cable channel operations
and programming.
Recommended Action:
Adopt Resolution No. 2019-47, "A Resolution of the City Council of the City of Huntington Beach
Approving the Withdrawal of the City from the Public Cable Television Authority."
Alternative Action(s):
Do not approve the Resolution and direct staff accordingly.
Analysis:
Beginning in April 2018, the City Council directed staff to analyze PEG access/outreach methods and
the operations of the PCTA. Staff subsequently presented City Council with information related to the
best practices of local government programming. This Study Session included the history of PCTA,
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File #: 19-761 MEETING DATE: 7/15/2019
an overview of their governance structure and finances, and a look at what the current trends are in
TV - specifically PEG Channels. Following that Study Session, staff once again came back to
Council in July 2018 and presented further findings about the existing operations of PCTA, reported
back on PEG operations in neighboring jurisdictions, and provided an overview of the National
Association of Telecommunications Officers and Advisors (NATOA) conference where staff learned
about best practices and trends in the cable marketplace.
What was gleaned from this deep dive was clear - the operations of the PCTA JPA had not kept pace
with the emerging trends in the marketplace and were somewhat out of date. More and more people
are "cutting the cord" or have never subscribed to cable TV in the first place and are using alternative
means to view desired products (e.g. streaming services like Amazon Prime, Netflix and Hulu).
On December 17, 2018, staff presented an exit and transition plan to the City Council. Following that
meeting, the City Council on January 22, 2019 directed the City Manager to issue a Notice of Intent
to Terminate from PCTA effective July 22, 2019. Since January, staff has implemented the PCTA Exit
and Transition Plan and has held weekly "Red Team" meetings comprised of staff from the City
Manager's Office, City Attorney's Office, Information Services, Office of Business Development, and
Finance to ensure a seamless transition. This Council Action is the culmination of six months of
preparation to assume the functions of managing and running a public access channel.
Environmental Status:
Not Applicable
Strategic Plan Goal:
Enhance and maintain high quality City services
Attachment(s):
1. Resolution No. 2019-47, "A Resolution of the City Council of the City of Huntington Beach
Approving the Withdrawal of the City from the Public Cable Television Authority."
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RESOLUTION NO. 2019-47
A RESOLUTION OF THE CITY COUNCIL OF THE
CITY OF HUNTINGTON BEACH APPROVING THE WITHDRAWAL OF THE CITY
FROM THE PUBLIC CABLE TELEVISION AUTHORITY
WHEREAS, prior to May 1979, the Cities of Huntington Beach, Fountain Valley,
Stanton and Westminster entered into a Joint Powers Agreement (the "JPA") creating the Public
Cable Television Authority ("PCTA"), pursuant to Government Code Section 6250 et seq.; and
WHEREAS, in 1979, the PCTA granted a cable television franchise to Dickinson Pacific
Cablesystems to operate within the four Cities. In 1989, both the PCTA and Huntington Beach
approved the transfer of the Franchise to KBL Cable, Inc. In 2000, the PCTA approved the
transfer of the Franchise to AOL Time Warner, Inc. ("Time Warner"); and
WHEREAS, in 1990, the four Cities entered into a new JPA. On March 14, 2004, the
Cities approved the most recent JPA, entitled "Restated and Amended Joint Powers Agreement
for the Public Cable Television Authority," dated April 20, 2004; and
WHEREAS, in 2006, the State Legislature adopted the Digital Infrastructure and Video
Competition Act ("DIVCA") permitting telecommunications companies to obtain video
franchises from the California Public Utilities Commission ("CPUC"). Subsequently, Time
Warner accepted a CPUC franchise. Pursuant to DIVCA at Public Utilities Code Section
5840(o)(3), the PCTA's franchise to Time Warner terminated when Time Warner accepted its
State franchise; and
WHEREAS, JPA Section 4 provides that "subject to the provisions of Section I I," the
PCTA "agreement ... shall continue in full force ... until the expiration or termination of any
franchise or extension thereof." JPA Section 11 provides that upon expiration of the term of the
JPA under Section 4, the Board of Directors "shall liquidate the business and assets and property
of PCTA;" and,
WHEREAS, the franchise the PCTA issued Time Warner terminated in 2006 when
Time -Warner accepted a Statewide video service franchise; and
By way of a pending legal action entitled, City of Huntington Beach v. City of Fountain
Valley, et al., Orange County Case No. 30-2019-01071652 (the "Action"), the City seeks to
enforce the provision of JPA Section 4 requiring the expiration of the PCTA upon the
termination of the Time Warner franchise. Further, because the term of the JPA expired upon
the termination of the Time Warner franchise, pursuant to JPA Section 11 and the Action, the
City seeks to compel the liquidation of the "business and assets and property of PCTA" and the
distribution of the net proceeds to the members pro rata according to their contributions; and
WHEREAS, regardless of the result of the Action, the City seeks to exit the PCTA; and
193 249/ 18-7141 /SFF
RESOLUTION NO. 2019-47
WHEREAS, JPA Sections 4 and 13 provide alternative means for a member city to leave
the PCTA; and
WHEREAS, pursuant to JPA Section 4, the City may terminate its membership in the
PCTA upon six (6) months written notice to the PCTA and its Members; and
WHEREAS, at its January 22, 2019 Council Meeting, the Huntington Beach City
Council directed the City Manager to give a six month written Notice of Intent to Terminate
Membership in the PCTA. On January 23, 2019, the City Manager notified the PCTA and the
other three Cities that the City was withdrawing from the PCTA, effective July 22, 2019.
WHEREAS, pursuant to JPA Section 13.1, the City may withdraw from the PCTA upon
filing a certified copy of a City Council Resolution expressing its desire to so withdraw, and
making arrangements to pay its pro rata obligations of the PCTA payable from contributions
from the City that mature after the date of such filing; and
WHEREAS, the Huntington Beach City Council is willing to pay its pro rata share of
PCTA obligations maturing after date of this Resolution, upon receipt of appropriate proof of
such obligation; and
NOW, THEREFORE, the City Council of the City of Huntington Beach does hereby
resolve as follows:
Section 1. The City Council hereby resolves that the City withdraw from the JPA
effective July 22, 2019.
Section 2. The City Council directs the City Clerk to deliver immediately a certified
copy of this Resolution to the PCTA Board of Directors, by serving it upon the Secretary of the
PCTA.
PASSED AND ADOPTED by the City Council of the City of Huntington Beach at a
regular meeting thereof held on the 15th day of July '2019 .
193249/18-7141/SFF
RESOLUTION NO. 2019-47
REVIEWED AND APPROVED:
City ager
Mayor
A PROVED AS TO FORM:
�dCity Attorney
INITIATED AND APPROVED:
City ager
193249/18-7141/SFF
Res. No. 2019-47
STATE OF CALIFORNIA
COUNTY OF ORANGE ) ss:
CITY OF HUNTINGTON BEACH )
I, ROBIN ESTANISLAU, the duly elected, qualified City Clerk of the
City of Huntington Beach, and ex-officio Clerk of the City Council of said City, do
hereby certify that the whole number of members of the City Council of the City of
Huntington Beach is seven; that the foregoing resolution was passed and adopted
by the affirmative vote of at least a majority of all the members of said City Council
at a Regular meeting thereof held on July 15, 2019 by the following vote:
AYES:
Brenden, Carr, Semeta, Peterson, Posey, Delgleize, Hardy
NOES:
None
ABSENT:
None
RECUSE: None
- 4�7� �&4v4jw
City Clerk and ex-officio Clerk of the
City Council of the City of
Huntington Beach, California