Council reviews cable franchise

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Craig residents will soon be writing checks to pay their cable bills to Bresnan Communications, the company that purchased several franchises from AT&T Broadband.

The deal is expected to be complete by September. Until that time, Bresnan hasn't released any information on rates or what channels will be offered.

"When they take over, we'll do some press releases on what will happen," Craig's AT&T Broadband General Manager Tom Cotton said. "There's nothing more that I can say because it's all speculative.

Bresnan is working on the purchase of nearly 40 systems all the cable franchises in Wyoming and Montana and those in rural Colorado, excluding the resort markets.

AT&T will sell Bresnan cable television systems serving about 320,000 customers for $735 million.

"Our long-term goal is to operate cable systems clustered in major metropolitan markets," said Bill Schleyer, president of AT&T Broadband. "Bresnan will do a terrific job managing these systems, so this transaction will prove good for customers and employees of the systems."

According to Cotton, AT&T has had its rural markets for sale since it merged with Comcast.

The city of Craig, along with several other Western Slope communities, split the cost of hiring a telecommunications attorney to determine whether Bresnan was fiscally sound before the council approved the franchise transfer.

"On behalf of the citizens of Craig we had a responsibility to do our due diligence," City Attorney Sherman Romney said. "We've had time to review the transaction and proposal and make sure they were coming through on what they promised."

According to the city's telecommunication attorney, Ronald Rizzuto, Bresnan plans to spend approximately $400 million in capital improvements over the next four years on the systems it is purchasing. Until then, the company has one of the lowest debt ratios in the cable industry, Rizzuto said.

"It is clear that the company is committed to reinvesting in these communities," Rizzuto stated in his report to the city.

The city earns some revenue from franchise fees, so it must approve the transfer before it becomes official. It was approved unanimously at the last council meeting. The resolution states Bresnan will pay franchise fees on gross revenues generated by the sale of cable services.

According to the ordinance dealing with franchise fees, the city is entitled to 5 percent of the gross revenues generated by the sale of cable services.

Last year, the city earned $59,746.36 from cable franchise fees.

The agreement is good until April 25, 2004.

"It appears Bresnan is a good corporation to have our cable franchise locally. They plan to invest a lot of money in our community," Romney said. "It's a fast-moving area and I think Craig is in a good position."

Bresnan Communications opened in 1984 with the purchase of five cable systems located in the Upper Peninsula of Michigan. Over the next 14 years, Bresnan made acquisitions in Michigan, Minnesota, Wisconsin, Mississippi and Georgia as well in Chile and Poland.

In the United States, Bresnan has upgraded more than 80 percent of its customers with systems featuring hybrid fiber-coaxial, providing some of the most advanced services available to suburban and rural communities.

"We plan to be able to quickly upgrade the majority of these systems," said William Bresnan, president of Bresnan Communications. "Our goal is to provide our customers advanced technologies and high quality customer service."

Cotton sees the purchase as a positive one.

"I'm sure they're will be a lot of good changes coming along,"

he said.

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