Local governments lawyer-up to negotiate with Comcast

Dec 16, 2016

Basalt joined forces with Aspen, Snowmass and Pitkin County this week in hiring an attorney to negotiate “franchise agreements” with Comcast.

Cable companies get television to their customers using town and county infrastructure. The lawyer will bargain for what the government gets in return.


Pitkin County’s assistant manager, Phylis Mattice, discovered the need for a specialized attorney to negotiate the franchise agreements when she sat down and skimmed through the documents.


“It’s pretty dry reading,” she said.


Mattice attended Basalt’s town council meeting on Tuesday to see if they wanted in on hiring Denver-based lawyer, Ken Fellman, who specializes in franchise negotiation. Basalt said yes. Mattice said joining together is a “cost-effective” way to go about franchise renegotiation.   


Cable companies basically rent public property when they bury cable on the sides of roads. And, to be clear, the re-negotiations only pertain to cable television, not the Internet, cellphones or landlines. Towns and counties routinely renegotiate what the cable company’s rent should cost. Rent comes in the form of two fees. The “franchise fee” is just a percentage the local government gets of the cable company’s gross revenue in their jurisdiction, and is capped at 5 percent. Then there are PEG fees, where the cable company gives the town or county a certain amount of money per subscriber per month. With that money, the towns/counties buy things like microphones, or anything to make broadcasting possible.  


The attorney, Ken Fellman, will help them negotiate these kinds of things. But there’s a greater strategy at play.


“If you have more communities sitting at the table saying, we’re aligned and here’s the deal that we want to work out, you have a stronger voice,” Fellman said.


That stronger voice means more money and more perks. Pitkin County is soon to be moving into a new building, and will need new equipment. Mattice also wants the county to be able to broadcast their meetings in HD.


The negotiations are also a chance to compare notes. For example, Pitkin County has been getting 50 cents per subscriber per month for their PEG fee, while Basalt was only getting 25 cents.

Mattice said the deal will be inked by the middle of next year, and will go on for another seven to 10 years. After that, she said, “We’ll see where television is in seven to 10 years.”


Cable television is seeing a lot of disruption. For communities like Aspen, Snowmass, Basalt and Pitkin County, Fellman said this cable franchise might be the last they negotiate. Even if it is, there’s a chance they’ll all get a better deal than before, and at a relatively low cost. Fellman’s bill won’t exceed $20,000, and will be divided four ways.