City Council Meeting Date: January 16, 2018
To: Mayor and City Council
City Administrator
From: Kurt Wolf, IT Manager
TITLE
Consider resolution authorizing a $.25 increase to the PEG fee.
BODY
Action Requested:
The Northfield City Council approves the attached resolution authorizing a $ 0.25 increase to the PEG fees charged to subscribers of Charter Spectrum, which holds the current franchise contract with the City of Northfield.
Summary Report:
The City of Northfield proposes to increase the amount of PEG fees collected by Charter Spectrum and distributed quarterly to the City of Northfield in the amount of $.25 per subscriber per month. This is the maximum amount of increase in a one-year period.
Background Information
As a part of the existing contract with Charter Spectrum, we have the ability to increase the amount of fees collected by Charter Spectrum for the City of Northfield by a maximum of $.25 per year, to a maximum of $1.25, to be used to support public, educational and government access (PEG). PEG fees are collected from every cable subscriber in Northfield. That amount collected per subscriber is currently $.75 per month. By increasing the PEG fees by $.25, the additional amount that will be raised will be approximately $10,000 per year.
The question arose at the January 9th Work Session about the use of PEG fees. Our franchise legal consultant, Brian Grogan, from Moss and Barnett's legal opinion is: Several years ago the FCC issued an order - known as the 621 Order - that took the position that PEG fees are limited to capital costs. The FCC did not define exactly what capital costs are, but it would appear reasonable to conclude that paying staff salaries with PEG fees would not be acceptable. The City is free to use franchise fees paid by Charter Spectrum for any desired purpose (including paying staff salaries), but generally most cities now set aside the PEG fees for capital purposes - assuming the local franchise does not permi...
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