HomeMy WebLinkAbout1995-03-07 Info PacketCity of iowa City'
MEMORANDUM
DATE:
TO:
FROM:
RE:
March 3, 1995
City Council
City Manager
Material in Information Packet
Copy of letter from Council Members Kubby, Throgmorton and Pigott to
· Senator Mary Neuhauser expressing opposition to the death penalty.
Memorandum from the City Manager regarding Nila Haug complaints.
Copies of letters from the City Manager to:
a. Nila Haug regarding permits for her property ~,~
b. Steve Lacina regarding industrial park development ~,~
Memorandum from the Assistant City Manager regarding telecommunications ~jL-7
issues,
Memorandum from the Community Development Coordinator and the Director of.~
Housing and Inspection Services regarding feasibility of combining the
CCN and the Housing Commission.
Memorandum from the Finance Director regarding response to Story County
article on property tax burden.
Memorandum from the Superintendent of Recreation regarding action by
the Parks and Recreation Commission and the definition of family.
Memoranda from the City Clerk:
a. Council Work Session of February 20, 1995
b. Council Work Session of February 21, 1995.
c. Council Work Session of February 27, 1995
Copy of letter from the Fire Marshal to the Emergency Housing Project
regarding occupant load.
Agenda and related material
on Disability Rights and Education.
Copy of letter from the Board of Supervisors regarding FY97 library
funding from Johnson County.
Agenda for the March 2, 1995, meeting of the Board of Supervisors.
for the March 7, 1995, meeting of the Council
Memo from City Engineer regarding the Burlington/Gilbert Sts. Statistics._ ~
Agenda for 3/7/95 Formal meeting of the Board of Spervisors. ~
Agenda for 3/7/95 Informal meeting of the Board of Supervisors°
Copy of memo from PCD Dir. to Council Member Kubby re Sensitive Areas Ord. ~(
Copy of mem~ from PCD Dir. to City Mgr. re Longfellow Manor. ~
February 28, 1995
CITY OF I0 WA CITY
The Honorable Mary Neuhauser
3485 G. Richard Circle SW
Iowa City, IA 52240
Dear Senator Neuhauser:
We, the undersigned individual members of the Iowa City City Council, urge you to oppose the
death penalty. We do so for five reasons.
First, the death pe.nalty has never been shown to deter crime. States using the death penalty
have a significantly higher murder rate per t00,000 population than states that do not.
Second, the death penalty is not cost effective. It costs much more to execute a person than
to keep him or her in pdson for life'without parole.
Third, the death penalty is economically and racially discriminatory. Ninety percent of those
on death row were financially unable to hire an attorney to represent them at trial. Since 1930,
4,048 people have been executed in the United States; 56 percent of them were black or
members of other minority groups.
Fourth, the death penalty is irrevocable. Between 1900 and 1985, 139 innocent people were
sentenced to death, and 23 were executed.
And finally, we find it hard to see how killing someone who has killed another teaches that
killing is wrong.
We recognize that this issue is emotionally charged and that good people can hold diffedng
opinions. Nonetheless, we strongly encourage you not to adopt the death penalty, and we
appreciate your taking the time to consider our opinions in this matter.
Respectfully,
Karen Kubby
Council Member
~dim Throgmorton
Council Member
Bruno Pigott
Council Member
~10 EAST WASHINOTOH STREET . IOWA CITY, IOWA 52240-1826 · (319) ~$6-$000 · FAX
City. of Iowa City
MEMORANDUM
Date: February 24, 1995
To: City Council
From: City Manager
Re: Nila Haug Complaints
Attached is a compilation of the issues concerning complaints by Ms. Nila Haug. This information
was prepared at my request by the staff of the Division of Building Inspection.
cc: Mike Kennedy
bc5-1
Re: Nila Haug Letter of January 31, 1995
The Division of Building Inspection has had an ongoing dispute with Ms. Haug for most of the
past year, primarily because, in our judgment, she has not abided by the same rules and
regulations that are consistently applied to all other citizens in Iowa City.
Our discourse began in April of 1994 when Ms. Haug applied for a building permit to remodel only
the attic at 521 Washington Street into habitable space. She filed a complaint with your office
(City Manager's) at that time which I have attached along with my response. She subsequently
occupied the apadment without a final inspection or paying the rental fees. After several verbal
reminders, a notice of violation was sent on September 26 (attached). A final inspection of the
remodeled apartment was conducted on October 10, with five deficiencies noted and rental permit
fees were paid on October 12. A reinspection for correction of the noted deficiencies was never
requested; however, one was conducted in conjunction with another inspection on December 8.
At the same time as we were trying to entice Ms. Haug to comply with the rental housing
requirements, remodeling work was being performed in the basement of this structure to convert
it to a coffee shop. Ms. Haug applied fora building permit on July 12 limited to underpinning 25
linear feet of footings on the nodheast corner of the building where they were exposing more of
the nodh'basement wall and removing the necessary ground cover to provide frost protection to
the footings. This application did not include any interior remodeling or installation of windows
in the foundation wall. This permit was issued on July 13 - an unusually fast turnaround for that
time of year. A meeting was held in the City Attorney's office on July. 25 to discuss handicapped
restroom requirements pertaining to her tentative uses of the basement and first floor. It was
suggested that we not enforce the requirements. She subsequently appeared before the Board
of Appeals requesting a local amendment to the building code to accommodate her proposal.
As you will recall, the Board did forward an amendment to City Council; however, it did not
incorporate Nila's proposal because both Board members and City staff felt her proposal was in
violation of the ADA.
In September it became obvious that Ms. Haug was proceeding with the interior remodeling of
the basement without the required building and plumbing permits. Once again she was given the
benefit of the doubt and asked to comply with City regulations. She responded by insisting that
she did not need a building permit as she wasn't making any structural alterations. It was
explained to her that a building permit was required for many projects that don't involve structural
alterations. After several verbal reminders, Ms. Haug finally submitted some very poorly drawn
plans on October 7. These plans did not include a site plan. She was informed at that time that
her permit could not be processed without a properly drawn site plan. The site plan was not
submitted and work progressed without permits.
On November 11, a stop work order was posted on the property. During this inspection, newly
installed plumbing pipe was observed, which was not installed by an Iowa City licensed plumber
since the piping under the floor was not a type of material approved for that use in Iowa City.
Nila's son was present when the order was posted and was fully aware of its meaning. Work
continued. In the next few days Ron Boose received a phone call from Ms. Haug who insisted
she could not submit a site plan when she did not know how many parking spaces she needed.
2
On November 23 a letter was sent to Ms. Haug estimating the number of parking spaces as best
we could from the sketchy plan submitted, On November 29 Doug Boothmy received a response
from Ms. Haug which included her parking calculations along with an insistence that she had
obtained all required permits. Her calculations were grossly inaccurate. On December 5 a
licensed plumber applied for a permit to correct the illegally installed piping'. On December 6
citations were prepared for violation of three separate City ordinances. On Decefnber 8 Doug
Boothroy met with Ms, Haug, and intended to serve the citations. Ms, Haug produced a better
set of drawings at this meeting, including a parking layout and the citations were not served or
filed.
The site plan was reviewed by Terry Goerdt and found to provide an insufficient number of'
parking places. Subsequent correspondence and phone calls arrived at a possible solution.
Since she owned both 521 and 517 Washington, she could combine the parking and come within
two spaces of meeting the required number for both uses, Then she could apply for a min~r
modification which could reduce her required parking by two spaces. The only problem that
would remain unsolved is the proposed handicapped parking space in the front yard, Doug had
suggested an amendment to the parking requirements in the Iowa City Zoning Ordinance to allow
this situation. The amendment is soon to be considered by the Planning and Zoning Commission.
Ms. Haug then applied for the minor modification on January 19, 1995, The $30 application fee
was waived. After the modification was granted on January 26, the building permit was finally
issued on January 30. The final inspection was conducted on January 31 and a reinspection on
February 1. A temporary certificate of occupancy was issued February 1 subject to completion
of site plan requirements and approval of the amendment to allow handicapped parking in the
front yard. The fee for the temporary CO was again waived. It has since come to our attention
that Ms. Haug altered the minor modification by attaching an addendum when she had it
recorded.
The most recent complaint involved her displeasure w~th the sign ordinance, Existing regulations
do not permit erection of the type of sign Ms. Haug proposed and she was so informed.
Aside from Ms. Haug's general complaint about regulations, many of these problems could have
been avoided if this project would have been presented as a total package. We cannot foresee
what regulations will apply when we are not given full information. Ms, Haug has obtained three
separate building permits, two separate plumbing, and two separate electrical permits on this
project - all involving different contractors. We have had disagreements concerning rental
housing, handicap accessibility, building permits, plumbing permits, parking, and sign regulations,
It may have been possible to eliminate most of these confrontations if the applicant would have
submitted a complete, properly prepared set of plans at the very beginning of the project as do
the vast majority of permit applicants.
Attachments
mgr~haugittr
January 31, 1995
Iowa City Council Members
Civic Center
410 E. Washington
Iowa City, IA 52240
Dear Council Members:
I am writing to request your assistance in settling some disputes with the Iowa
City administration. I have been attempting to remodel a house at 521 E.
Washington since April, 1994 and have continuously been harassed and
stonewalled in my attempts to get my project completed. I wrote to Stephen
Atkins April 29 detailing the first of my problems. I did not get satisfactory
results then and still the problems continue.
I was told by City officials that I had to pay for a rental permit at the same
time I got a building permit even though I was only remodeling this single
family residence. When I refused to pay for the rental permit, the city would
not issue my building permit and held up the work. I questioned whether the
city made everyone remodeling a house obtain a rental permit. When I
requested that. the city sign an agreement to return my 988 if I paid for a rental
permit and did not rent the house they refused.
This is just the beginning of the incidences which has caused nearly a years
delay and caused me severe unnecessary financial hardship because this
project could not be completed.
From talking to others in their dealings with the City, and considering all the
lawsuits the City is involved in, I certainly know that I am not alone in my
complaints.
I have been advised to seek mediation and have been told that in your position
as council members, you can make these arrangements. Please let me know
w.hen this can take place. You may reach me by telephone at 338-6452 or at
the above address.
Sincerely,
Nila Haug /~'
April 29, 199¢
Steve Atkins
City Manager
Civic Center
Iowa City, IA 52240
Dear Sir:
I am writing to file a formal complaint against the personnel in the
City's Building Department. I applied for a building permit, as
required by city code, to remodel a house I recently purchased. '
When the permit was to be picked up, a person in the office
refused to release the permit insisting that I pay for a rental permit
before she would release the building permit which had been
approved.
I t~ave not finalized any plans for this house at the present time. It
has not been rented, nor is it being advertised for rent. I acquired
the proper~y in a tax-free exchange and by IRS ruling, ! must
reinvest a certain amount of money within a 180 day period in
order to complete this procedure. Because of the obstinate,
abrasive, and illegal behavior of certain personnel in the building
department, they are causing. delays which may invalidate this
entire transaction. I respectfully request that this inappropriate and
illegal activity be stopped immediately or I will have no recourse but
to file a lawsuit against the city.
Please take immediate action on my request and report back to me.
You may reach me at 338-6452 if you have questions. I sincerely
appreciate your assistance in this matter.
Sincerely,
cc: Mike Kennedy
City of Iowa City
MEMORANDUM
Date: May 5, 1994
To: Steve Atkins, City Manager
From: Ron Boose, St. Building inspector ~
Re: Letter of April 29 from' Nile Haug
Ms. Haug's complaint is a culmination of several weeks of discourse with the Building
Inspection Division. The initial disagreement arose from the fact that we refused to issue a
building permit for conversion of an attic area into bedrooms and a bathroom over-the-counter
with no plans. Once plans were submitted, she questioned our qualifications to examine her
contractor's plane, demanding tq see our engineering degrees, Once plans were reviewed and
the permit ready for issue, Ms. Haug paid the building permit fee but refused to pay for a
rental permit prior to the issuance of a building permit.
It is department policy to collect rental permit fees at the time that the building permit is
issued when the project is intep, ded to be'a residential rental property, The Building Inspection
Division has adopted and consistently enforced this policy to assist the Housing Inspection
Division with the tracking of rental properties and collection'of fees. The property in question
is a ,three-story structure with a basement in a CB-2 zone. Although th6 original permit
application did not indicate what the newly-created third floor was'to be used for, this
information is necessary to process the permit and a call to the contractor divulged that the
area was an extension of a second floor apartment. Conversion of this area to commercial
space would require construction of a second exit which would be economically unrealistic.
Since Ms. Haug has not indicated that she intends to occup{/this apartment herself {which
would make her bed and breakfast next door - where she currently resides - an illegal use),
the apartment requires a rental permit. '
Doug, Joan and I have discussed the matter and decided to. go ahead and issue the building
permit and bill Ms. Haug for the certificate of structural compliance and renta permit.
cc: Doug Boothroy, Director, HIS
September 26, 1994
NOTICE OF VIOLATION
Nils K. Haug
517 Washington St.
Iowa City, IA 52240
Re: 521 Washington St.
The above-listed property was inspected on September 23, 1994 by Inspector Paul Bowers, Depart-
ment of Housing and Inspection Services. The following items have been determined as violations of
Chapter 14-§E; the Iowa City Housing Code and are hereby brought to your attention for correction:
14-5E-16-A (1) & {2) RENTAL PERMIT AND CERTIFICATE OF STRUCTURAL COMPLIANCE, Property
is being rented without a Rental Permit and a Certificate of Structural Compliance, Fees and applica-
tions must be submitted and an inspection scheduled,
You will have 10 days after receipt of this notice to correct these deficiencies.
FAILURE TO CORRECT THE VIOLATION{SI WITHIN ~-IE TIME SPECIRED MAY RESULT IN ISSUANCE
OF A CITATION AND FURTHER LEGAL ACTION BEING TAKEN.
Should you wish to contest this (~rder, Appeal Request forms can be obtained at the Housing Inspec-
tion office, 410 E. Washington Street. Any appeal must be received tn the office of ihe City Clerk
within ten (10) days of your r/~ceipt of this notice. Failure to request an appeal shall constitute a
waiver of the right to a hearing and this notice shall become a final determination and order.
If you have any questions regarding this notice, please call the Housing Inspection Division at 356-
5122.
Sincerely,
St. Building Inspector
February 24, 1995
CITY OF IOWA CITY
Nila Haug
521 Washington St.
Iowa City, IA 52240
Dear Ms. Haug:
Attached is a packet of information directed to the City Council's attention in follow-up to
items of correspondence you directed to the City. I asked the Division of Building Inspection
to reconstruct for me in memorandum form the issues associated with your apparent ongoing
complaints concerning the operations of that division as it affects your properties. It is my
judgment that the City staff has extended itself, not only in working with you personally
concerning your obligation to satisfy various city regulations, but also the waiver of fees of
charges were an extraordinary benefit granted to you.
In your correspondence you have implied you may wish to file a lawsuit against the City and,
accordingly, I have copied the City Attorney's office and your attorney, Michael Kennedy.
Sincerely,
St h
ep en J. Atkms
City Manager
Attachment
cc: City Council ~/
Linda Woito
Doug Boothroy
Ron Boose
Mike Kennedy
b~ug
CITY OF I0 WA CITY
February 27, 1995
Steve Lacina
Johnson County Board of Supervisors
P.O. Box 1350
Iowa City, IA 52244-1350
Dear Steve:
The other evening the Council discussed issues associated with industrial park development
and, in my judgment, appears interested in pursuing the possibility of a public/private
partnership and/or a local government-owned industrial park. The terms, conditions and a
number of other factors will be critical as to whether the policy is one of public/private or
publicly-owned. Also, they were aware of the interest on the part of the private owners, I
believe it is the Streb family.
In order for us to proceed, it appears there must be some means by which we can preserve
the lands, that being the possibility of county industrial, or if I recall manufacturing zoning,
for the land in question. This would encourage the Strebs, and I suspect to the
Houghton/Tucker interest, as to what we would like to see occur on that site. I understand
it is residentially zoned. Additionally, we can begin the design of infrastructure to serve the
park, while not putting together a formal park plan, this could also demonstrate our
commitment.
It is my intention to contact the Houghton/Tucker interest to determine how they might like
to proceed with respect to this public/private partnership and/or public ownership concerning
their land. My suspicions are they are anxious to sell the land and remove themselves from
the land development business and allow others to proceed in development.
In that the County has expressed interest in this project idea, are you considering financial
participation as part of the partnership and/or is there SO,he partnership between the City and
the County with respect to financial interests that we would like to pursue.
I will be making various contacts very soon and would hope that you would begin giving some
thought to how this might proceed through the County Board of Supervisors. I have chosen
to contact you directly, not only due to your interest, but our experience gathered while you
410 EAST WASHINOTOH STRE£T ~ IOWA CITY, IOWA 52240-II26 · (319)
Steve Lacina
February 27, 1995
Page 2
served as Chair. By copy of this letter to Charlie Duffy, I wilt keep you informed of our
interest. The means by which you inform the other county officials I will leave to you?
discretion.
Sincerely,
Stephen J. Atkins
City Manager
cc: Charlie Duffy
City Council
Karin Franklin
David Schoon
Chuck Schmadeke
City of Iowa City
MEMORANDUM
Date: March 2, 1995
To: City Council '
From: Dale Helling, Assistant City Manager
Re: Telecommunications Issues
Attached please find materials for your review in preparation for your work session discussion on
telecommunications issues, Drew Shaffer has provided an outline for your discussion, We can
spend as much or as little time as necessary on reviewing the history of cable legislation, but the
primary purpose is to help you gain a better understanding of the issues currently before the
legislature.
I think you will find the first eight or nine pages of attachments to the outline as the most helpful
in framing the issues currently under consideration. The remaining materials are interesting and
may certainly be of further help to you. I encourage you to read them as time permits.
If you have more specific questions or would ke other ~nformat on pr or to your d~scuss[on please
give me or Drew Shaffer a call.
cc: Drew Shaffer
bc4-1
City' of Iowa City
MEMORANDUM
Date:
To:
From:
Re:
I.
Ill.
IV.
March 1, 1995
City Council
Drew Shaffer
~..-,
Recent telecommunications hi~tory and current legislative issues facing cities
1984 Cable Act Overview
B.
C.
D.
Deregulation of cable rates
Franehising requirements established
PEG channels requirement set
5% franchise fee cap established
1990 Judge Harold Green's Modified Final Judgment (MFJ) lifting prohibition on phone
industry into information industry.
1992 Cable TV Consumer Protection and Competition Act Overview
A. "Re-regulation"
Established FCC as authority determining rates, consumer service standards,
competition definitions, allowing phone industry into provision of cable service
on a test/experiniental basis,
Broadcast industry protection and reimbursement for programming
Establishes city's ability to own and operate cable systems
1994 Cable Legislation
A cable bill passed the house and was stopped in the Senate at the "last hour" by its
sponsor, Senator Hollings, reportedly because of phone industry's unwillingness to
compromise. Purpose of bill was to open up competition in phone and cable industries
by breaking barriers to entry for each.
1995 Telecommunications Competition and De-regulation Act of 1995 Overview
(Introduced by Senator Pressler)
A. Telco entry into cable; cable entry into telco
KEY CITY ISSUES NEEDING TO BE ADDRESSED:
1. Local government's rights to manage public rights-of-way (PROW).
Local government's right to receive compensation for commercial use
of public property for private profit.
Local government's right to determine and negotiate benefits from and
access to sophisticated telecom systems located in our streets (i.e. PEG
channels, emergency alerts, reduced rates for critical communications
between public agencies and City departments, etc.).
Level playing field for cable and telecos, including, most importantly,
protecting local governments' rights to require franchises, licenses,
agreements - and requiring any new providers {i.e. telecos) to be
subject to same franchising requirements; and current revenues form
cable or telecom providers should not be reduced or eliminated by
legislation.
February 3, 1995
The National Association of Telecommunications Officers and Advisors
An agiliale of he Natfonal League of Cities (~
Telecommunications Reform in the 104th Congress
LOCAL RIGHTS-OF-WAY MANAGEMENT MUST BE PROTECTED!
The 104th Congress has put telecommunications reform on its priority list of legislation it intends to pass and send to
President Clinton before the July 4th break. The Senate and }louse have already begun drafting legislation. Plans
are to move the bills out of Committee by mid-March and to the floor by mid-April. That leaves little time for local
government to press its position on Capitol Hill.
It is very important that the right-of-way management issues that your community faces on a day-to-day basis be
explained to Members of Congress. Congress should also understand that communities are not seeking new
compensation from telecommunications companies, they are merely seeking rent for the use of publicly-owned
property. Use the four talking points below to brief your elected official on the importance of these issues.
Local Governments should retain the right to:
1. MANAGE PUBLIC-RIGHTS-OF-WAY AND IMPOSE REQUIREMENTS ON ITS OCCUPANTS
Local governments must continue to have any and all current rights to manage the public rights-of-way
(PROW) .including requirements for performance bonds, insurance, indemnification, proper permits, and
other conditions that affect the public safety and interest. Nothing should preempt, modify, abrogate, negate
or in any way limit the authority of any local government to adopt ordinances, regulations or other provisions
regarding PROW use.
2. RECEIVE COblPENSATION FOR COI~hMERCIAL USE OF PUBLIC PROPERTY FOR PRIVATE PROFIT
Tlte PROW is a valuable property developed at great expense by local jurisdictions and taxpayers. Counties
and municipalities deserve fair and reasonable compensation for the commercial use of the PROW for private
profit.
3. RECEIVE CERTAIN PUBLIC BENEFITS FROM AND ACCESS TO TELECOM INFRASTRUCTURE IN OUR
COM~'IUNITIES, AND TO DETERMINE TIlE APPROPRIATE NEEDS AND METHODS AT THE LOCAL LEVEL
Local governments should have the right to benefits from and access to sophisticated telecom systems located
in our streets. These benefits cannot be a "one size fits all" mandate from the federal government; they must
be determined and negotiated at the local level. Governmental and educational access; emergency alert
overrides and communications; and reduced rates for computer networks that provide critical information
between city departments or to the public are legitimate needs that should be able to be addressed by telecom
occupants of the PROW.
4. IMPOSE SIMILAR CONDITIONS ON SIMILAR PROVIDERS OF SIMILAR TELECOM SERVICES IN
ORDER TO MAINTAIN "LEVEL PLAYIN, G FIELDS" IN OUR COMMUNITIES
Existing rights to require franchises, licenses, agreements, etc. should not be preempted. New providers of
similar services should be subject to the same requirements imposed on current providers. Cities and counties
should be able to make some reasonable distinctions in these requirements to account for needs that may be
due to location of particular systems, the specific type of services offered, state rules, and franchises or
licenses that were in place before legislation was passed. Current revenues from cable or telecom providers
grapevine
NATOA At Work (Recent FCC Filings)
NATOA, through its FCC Liaison Committee and its legal counsel, Arnold & Porter, has been keeping NATOA's
interests before the FCC by filing comments in several ongoing proceedings at the Commission:
Rate Regulation, In the last months of 1994, the FCC
issued revisions to the Rate Regulation rules that give
operators great freedom to pass through costs and set
rates without regard to the benchmark or permitted rate
structure. These changes have the effect of limiting
local government's ability. and efficacy in regulating
cable television service and equipment rates.
As was explained in the Winter 1994-95 NEWS
Quarterly, the Fourth Order on Reconsideration allowed
operators to treat both franchise fee increases and FCC
regulatory fees as external costs and to pass them
through to the subscriber. NATOA has filed a petition
requesting that the FCC repeal or modify these rules to
better protect subscribers from unreasonable rate
increases.
NATOA's petition decried the franchise fee pass-
through because the amount on a subscriber's bill that an
operator attributes to franchise fees is a much contested
issue at the local level. NATOA opposed the regulatory
fee pass-through because requiring all subscribers to bear
the same fee burden results in basic-only subscribers
paying a disproportionate share of the cable regulatory
fees and, therefore, an unreasonable rate for basic cable
service.
In a second rate regulatory proceeding, NATOA
filed a Petition for Reconsideration of the Sixth Order on
Reconsideration (the "Going Forward" rules) of the Rate
Regulation rules. The Going Forward rules, explained
in the December 1994 NewsFlash, permit operators to
increase rates for new CPST channels and establish a
new, unregulated category of CPST called a New
Product Tier (NPT).
NATOA's petition urged the Commission to repeal the
revised rules or modify them to ensure that consumers
do not pay unreasonable rates for new cable
programming services and NPTs. NATOA argued that
operators have no incentive, under the 20 cent cap, to
negotiate for the lowest license fee and that they are
likely to add low-cost programming services rather than
the programming subscribers may actually want. With
regard to the NPT rules, NATOA asserted that the rules
violate the 1992 Cable Act because they entirely remove
the cable programming services in the NPT from rate
regulation.
Video DiMtone. The FCC is also beginning to address
its Video Dialtone rules. Several issues of concern to
local governments are under consideration by the
Commission in the Third Further Notice 'of Proposed
Rulemaking. NATOA, through Arnold & Porter, filed
comments with the FCC on December 16, 1994, urging
that: 1) Video dialtone providers grant preferential
access to PEG programmers, 2) LECs not be permitted
to acquire cable facilities to provide video dialtone
services, 3) The FCC should not preempt local and state
pole attachment and conduit access laws and LECs
should be prohibited from denying access to their poles
and conduits to competing multichannel video providers,
and 4) Expansion of channel capacity should be
promoted as long as it is consistent with the needs of
consumers and cust~_~gra_~ rs~.......~
f~,.Th'~Commission is also addressing, in a-~arate
~roceeding, an issue (tf greatest cnncern to l~cal
~uthor!t~ether Video Dialtone_, sys!en~ sh;uidXl~
t~ubject to local franchises or any ~fthe rules in place forX{
cable ,s,ystems under Tit? VI o,f,_.th__e_?o_ mn~,.u~ .c~tio...n~. \
A~ lh.e comment period for this proceed/ng Is still
open, vath comments due by March 6th. The issues
presented in the Fourth Further No.t'm oe f Proposed
Rulemaking is ~ssf'~ is addressed later in th~s lxtewsFlashj]
k~,~F~"~n an anicle~--~-b"~-'Y '°hn Pestle.~
NATOA, through its hard-working FCC Liaison
Committee, will continue to keep abreast of all
proceedings and activities at the FCC and will continue
to file comments as necessary to promote the interest of
local government on the Information Superhighway.
NATOA NEWS Flash FEBRUARY 199.5
Page
fcc grapevine
Video Dialtone Franchising at Issue in Rulemaking -- Comments Due March 6th
by John Pestle and Patrick Miles
(NATOA members John Pestle and Patrick Miles are attorneys at Varnurn, Riddering, $chtnidt & Howlett, in Gram
Rapids, Michigan)
On January 12, 1995, the Federal CommunicatiOns commission (FCC) adopted its Fourth Further Notice of
Proposed Rulemaking CNOPR") which seeks comment on whether a telephone company providing video dialtone
CVDT") service is treated as a cable operator, along with several other related points. This mlemkaing raises and
addresses issues directly affecting the ability of municipalities to franchise telephone companies ("telcos") that provide
their own programming ona VDT system in their telephone service area. If municipalities are unable to franchise telcos
utilizing public rights-of-way in their provision of video services, then existing. cable franchises are seriously jeopardized
as well.
The FCC already has granted some telcos the ability to test VDT services in certain markets and to offer video
programming through an affiliate without a franchise. Thus, the FCC appears to be leaning toward a pro-telco/anti-
municipality approach.
Background, Since the 1970's, a FCC-imposed cross-ownership ban has prevented telcos from providing cable service
and from holding an ownership interest of five percent or more in a video programmer that offered service inthe telco's
telephone service area. The ban was established initially because the FCC believed the emerging cable industry needed
protection from telcos offering video programming or otherwise limiting the development of cable. The 1984 Cable Act
incorporated the ban. The FCC's VDT framework also provided that a cable franchise was not necesary for VDT
because under the Cable Act's relevant definitions, VDT operators were not offering "cable service" a~d were not "cable
operators".
'In 1990 through 1992, the FCC established a VDT framework which allowed telcos to set up video delivery
systems without being subject to the Cable Act (Title VI of the' Communications Act). Instead, the FCC's VDT
framework treated telcos' VDT facilities as common carriers under Title II of the Communications Act (i.e., the
telephone-common carrier title). The VDT framework, however,' continued the telco-cable cross-ownership ban. Thus,
telcos were not permitted to offer their own video programming on their VDT system in their telephone service area.
The United States Court of Appeals for the Fourth and Ninth Circuits recently ruled that telcos can provide video
programming directly to subscribers in their local telephone service areas on VDT facilities, subject to the typical
(telephone) franchising requirements, because the 1984 Cable Act's cross-ownership restriction violates teh First
Amendment speech rights of telcos. The FCC is now addressing whether telces should be able to provide their own video
programming over their VDT platforms (thereby effectrely becoming cable operators) without a local franchise. NOPR,
at ~ 17, 22.
Local Franchises. In the section of the NOPR of most interest to munipalities, the FCC is seeking comment on whether
telco provision of video programming should be governed by Title II, Title VI, or both. See NOPR, at ~[ 15. If Title
VI applies, then the telco is subject to the Cable Act and its franchise requirements. The FCC stated somewhat cryptically
that it seeks "comment on the potential impact of our determinations in this proceeding on existing grants by state and
local authorities of public rights-of-way". Id.
The FCC has tentatively concluded that, in the absence of significant governmere interest to the contrary, it should
allow telcos to provide video programming over their VDT platforms subject to Title II and appropriate safeguards.
NOPR, at ~[ 10.
(continued next page)
NATOA NEWS'Flash FEBRUARY 1995
Page 4
grapevine
Video Dialtone Rulemaking (continued from previous page)
Applicable Cable Rules. The FCC asks that in the event Title VI cable rate regulations rules apply, whether such rules
should apply to a telco providing video programming directly to subscribers over its VDT platform. NOPR, at ¶ 15.
Also, if Title VI does not apply to telcos offering vide programming on VDT facilities, the FCC asks whether it should
adopt analogous provisions under Title II. Analogous rules include program access by competing distributors, carriage
agreements between service providers and unaffiliated programmers, and vertical ownership restrictions. ld.
Mandatory VI)T. The FCC is also asking whether it can and should require telcos to provide video programming only
over VDT platorms, instead of permitting telcos to build or purchase cable systems. NOPR, at ¶ 10, 13.
*** Given the nature of the issues involved, it is critically important that all municipalities participate in this rulemaking -
- by filing comments and contacting Commissioners and their staff.
COMMENTS ON T/iE NOPR ARE DUE A_.~T THE FCC ON MONDAY, MARCH 6, 1995.
Brief Instructions For Filing Comments with the FCC
(IMPORTANT- Send NATOA a copy of anything you file.)
1. ALWAYS FILE AN ORIGINAL DOCUMENT OR LETTER AND THREE COPIES
Address to: Mr. William F. Caren, Acting Secretary
Federal Communications Commission
1919 M Sgect, NW
Washington, DC 20554
2. ALWAYS NOTE ON THE FIRST PAGE THE SUBJECT OF THE FILING BY FORMAL PROCEEDING NAME'
'The proceedings named below are for the two open rulemaking proceedings discussed in this NATOA NEWS Flash.
Informal Filin~ or Letter
Note the subject in a standard 'RE:' line beneath the Address and before the Salutation ('DEAR SIR').
Formal Filing
Note the subject in the upper left-hand corner in the following format.
In the Matter of )
- )
TELEPHONE COMPANY-CABLE TELEVISION
Cross-Ownership Rules, )
Sections 63.54 - 63.58 )
In the Matter of )
)
Implementaiton of Sections )
of the Cable Television Consumer)
Protection and Competition Act of 1992 )
)
Rate Regulation )
3. IF SUBMITTING FORMAL FILING, BEGIN DOCUMENT WITH "COMMENTS OF THE (your jurisdiction's name)".
4. IF SUBMITTING INFORMAL COMMENTS, tell your stories, anecdotes, and reasonings relative to the particular issue
on which you are filing.
(continued on next page)
NATOA NEWS Hash FEBRUARY 1995
Page
VOLUME 16 NUh*,BER 6
Seen C ose
To QVC Agreement
]By JOHN M. HIGGINS
Tele-Communications Iac.
moved closer to winning its lat-
est showdown with antitrust
regulators, with the Federal
Trade Comm{sslon apparently
leaning toward approving a
TCI-backed takeover of'shop.
ping network QVC Inc.
Executives 9amiliar with the
negotiations between TCI and
FTC officials said that com-
missioners are taking a softer
stance than members of the
FTC staff' on whether TCI
should be able to partner with
MSO Comcast Corp. in taking
over the network.
TCI and Comcast were pre-
pared to fi~rce the issue at 5
p.m. Monday tFeb. 6. 1995l,
~cheduling the comamncement
of their $46 per share tender
offer for the $1.4 billion worth
of QVC stock they do not al-
read.v own. Sources familiar
with the lwfC's review of the
deal predicted commissioners
would overrule the abjections
of staffers reviewing th~ deal
and sign c.Ton the takeover.
'It looks very good at thi~'
point," said one industry exec-
utive familiar with discussions.
TCI and Comcast already
have sizable stakes in QVC,
stakes acquired when they
backed the startup of the shop-
ping network in 1986. Howev-
or, [~I'C stalt;~rs have objected
to a hayout of QVC's public
shareholdm~ because TCI also
controls rival channel Home
Shopping Network Inc. Stall'
[awym~ fear that aliawing
too much control of the home
shopping industrW coald blunt
the emergence of competing
shopping networks.
A~le,' a series of extensions of
their tender offer, TCI and
Comcast decided to three the is-
sue three weeks ago by an-
nouncing they would push
ahead with the deal, essential-
ly dating the ~I'C to go U) cour~
to black it.
Forcing the issue was im-
portant to TCI presideat and
CEO John Makme, who has
l~come a lightning tad t~n- an-
titt'ust regmlatm's and has had
to tangle with the FTC on
Lhree other deals in the past 16
manlbs.
However. in separate meet-
ings with FTC commissioners
last week, TCI's lawyers
pre:~:~.~ the case that the home
shopping business is not the
"relevant market" by which to
assess competition. With com-
bined sales of $2 billion, the
two shopping uetworks com-
pete directly with department
stores, discount stores and cat-
alog campanles.
Asked whether the conmils-
See TCI, Page 50
54 00
Presslet Bill Calls
For DeReg Future
By TED HEARN
WP,~ltlNtrl'ON -- All rothie rates
-- basic lind expanded -- could
be dm'egmlated under broad
unveiled last week by Senate
Commerce Committee chairrotan
Sea. Larry Presslet
Pressler, who sent copies to
the White House and Capitol
Hill Demncrats for camment,
said to~l rate deregmlation was
his goal. But cable industry
sources noted that the langqmge
in the proposed bill only called
{br de~gmlation of expanded ba-
sic tiers.
Pressler's 82-page plan would
retain the progmara access provi-
sions of the 1992 Cable Act, as
well as hmadcasters' must-can~
and retransmission consent
right.
"I believe the programming
lxn%ions have worked well. There
have been prablmns in the area
of,'a~s," Presslet said. ~I wauld
not classify it as ,'e~al of the Ca-
ble Act."
But Sen. ~>~,% Packxw~
(),~.), the influential chairman of
the Communications Subcom-
,nittee. opposes retaining the
progq'anl access rules.
"I would like to go back to the
'8,1 Act." Packwood snld last
PRESSLER PACKWOOD
CABLE EXECS STORM THE HILL: PAGE 47
week. "If I can't'get that, I would
totally deregmlate rates."
Taking Pressler at his word,
cable's tbderally cont,a~lled rate
stinklure would vanish u~n the
bill's enactment. One your Inter,
cable and I~al photo, companies
could invade eoch other's mar-
kekq in a c~x~.ms-entz~ scheme that
could gdve the telcos a two-year
head start.
Robert Thomson. Tele-Com-
nlanications lnc.'s senior vice
president of~mmunications anti
phiicy planning, wilted cnncern
aNmt the gq-cmnd rules of cable-
to]co mm~petition. Nevertheless.
See PRESSER, P~ge 47
Pressler Bill Calls For DeReg Future
Continued from Page I
he called the Presslet draft "a
marvelous first effort."
The National Cable Televi.
sloe P~seciation -- in sharp coa-
trast to its profuse support for
Democratic-sponsored legisla-
tion last year -- would not re-
lease a detailed reaction to
Presslefts plan. NCTA
spokesman Rich D'Amato did
call it "a positive approach, a
positive flint step."
Some in the cable industry
were surprised and delighted
about the bold move to lift rate
regulations.
"We didn't ask for it. That's
the irony of that," said Stephen
Eftres, president of the Cable
Telecommunications Associa-
tion.
"It's certainly a strong foun-
dation," said Bert Carp, vice
president ofgovernment affairs
for Turner Broadcasting System
Inc.
Eftres said cable might even
resist inclusion of broad rate
deregulation because of the po-
litical stir it could cause.
Presslet's draft would lift
broadcast station ownership
caps and allow broadcasters to
use high-definition spectrum for
pay services if broadcasters
compensated the guvemment. It
would lift. foreign ownership re-
strictions of U.S. media proper-
ties under a reciprocal test.
It also would allow the Baby
Bells to enter long-distance and
telecom equipment-makiug
markets in one to three years,
provided the seven Baby Bells
have complied with rules that
prescribe the terms of opening
local exchanges.
Willful noncompliauce with
the bilrs interconnection man-
dates could cost a local phone
company $1 million pet' offense,
per day. Other noncompliance
penalties could reach as high as
$500 millimy and a six-mnnth
delay on long-distance entry.
"We built in beth a number of
rewards and penalties into this
hill.~ Pressler said. "There are
penalties for non-compliance."
Bradley Stillman, legislative
counsel for the Consumer Fed-
eratibn of America, said the
fines were all but meaningless
because proving willfulness in
court is difficult. The bill assigns
the burden of proof to plaintills,
not phone companies.
The long-distance and manu-
facturing provision would elim-
inate the court decree -- the
Modification of Final dudgnmnt
fMFJ) -- that broke up the old
Belt system in 1984,
The lobbying group backed by
AT&T Corp. and MCI Commu-
nications Corp. -- the Compet-
itive Long Distance Coalition --
said the Pcessler bill on Bell en-
try. into long-distance provided
no assurance that local phone
markets would be open simul-
taneously, They objected to a
provision that specifies a "date
certain" for telco entw into long-
distance.
"I would rather see the time
that RBOCs could enter other
markets tied to how quickly
they perform in opening up
their markets to competition,"
said MCI CEO Bert Roberts in
a speech to the Atlanta Cham-
ber of Commerce.
The Baby Bells released a
joint statement suggesting the
bill was lopsided in favor of
long-distance and cable compa-
nies.
"This draft pcevides certainty
for others. but does not prm4de
cartainty UF timing for Bell com-
panies." said Gary McBee,
chairman of the Bell-backed Al-
liance for Competitive Commu-
nications.
Pcessler's plan embraced key
lobbying objectives of the cable
industry. It would preempt
state laws that protect phone
manopolies, bar the ~lcos from
cross-subsidizing their video
programming network invest-
ments and permit cable-telco
joint ventures without an ap-
parent restriction other than ex-
isting antitrust standards.
Contrary. to the NCTA's wish-
es, Pressler's plan seems to per-
mit cities and counties to retain
control over their rights-of-way
and perhaps impose new fees on
cable operators that provide
phone service.
Telcos offering video dialtone
would not be required to obtain
local franchises but could be re-
quired to pay franchise fees.
Telcos that opt to build cable
systems would need franchises.
The plan would force the Fed-
eral Commuaications Commis-
sion to suspend consideration of
~ff)T applications; approved ap-
plications would be de-autho-
rized for one year. But a year in-
to the new law, telcos would no
longer need FCC approva'l to
build video network plant.
The bill could put cable at a
competitive disadvantage.
While nothing in the bill would
impede Bell entry. into cable, lo-
cal phone companies could drag
out interconnection fights at the
local level for up to 22 months
and stall cable entry into tele-
phony.
"The interconnection lan-
guage needs to be tightened up
substantially," TCt's Thomson
said. But he called this and oth-
er defects "nits and gnats" to be
dealt with later in the process.
Presslet said he had the sup-
port of Senate Majority Leader
Robert Dole and all Commerce
Cormnittee Republicans. An aide
to Sen. Ernest Hollings
the ranking Democrat on Com-
merce, said Hollings planned to
reply by Feb. 14. --tl~Ot
Cable Executives Storm The Hill
By DAVID KAUT
Wt~sltI~¢nX)N -- (,uble offic'~ Is from around the
country cotyverged on Capitol Hill b~st week to pres,q
fi~r tolecommunlcations refiwm legislation they soy
~s critical to the industry's future.
d hil . , ·
An w e most optrators said the meetings
At deadline. neither Ging~ch nor Walker ceuld
he reached fi~r comment.
Elsewhere, operators passed the "message wits
that we definitely want to see a bill pass and that
we're willing to help get it done," said William L~tw.
son, governnwol offaim chiefofTCl Cablevision of
Washing~m.
~01J JN(; MYAIX )W.% IlJ. -- /
though Arttee Corp.'s stock ph
dropped alter the comp~my i.~su
dimppeinting forecrUs, iL~.~des i
mm%-'d 99 perucut during the tiao
quarter. For the three months er
cd December, Antec's .~es tntal
$136,6 million rs. $110.6 milli,
during the same peri~xl a year c~
lief. Operating inmme rose 39 D
cant to $9.8 million.
Wasm,~m~--Sen. Jam~s 1;
on/I3Neb. I, and Sen. Slade Gt
ton (R-Wask~. last week introduc
legislation calling for full .,amaro bli
ofadult pay-perMew pagrants ~
fines for obscene cable bmad~s~
NEw Yolm -- Nickelode(
last week opened its kids upfro
market and closed major der
with Leo Burnett Co., Grey ^
vertising, Toy Biz and anoth
major toy manufacturer, said dol
Popkowski, executive vice pre
dent of MTV Networks Advert
ing Sales. psHe wouldn't quant
the dollar mount on. the dca]s. b
one source pegged it at rough
$50 railhon. Nick came out aski:
for price hikes in thp low-20 p~
cent range. The agreements
Grey. Leo Burnett and Toy E
were for two years. Popkowski c
ciined to identity the toy maker
W,~SH~GTON -- Sen. Byr(
Dotgan tD-N.D.I last week said
intends to offer legislation requ
ing the FCC to prepare q~ ~iolen
m~rt cards quarterly. Hes alma~
intvtxlucad a bill requiting ~4olen
blocking technology in TV sets.
ENGLEWOOD, COLO. -- Tel
Cormnunications Inc. camph
ed its acquisition of a 10 perce
stake in computer game publis
er Acclaim Entertainment h
TCI put no cash into Acclai~
with the companies simply e
Pinyboy C.ble
Cmcaao -- Playboy Entt
prises Inc.'s cable networks sol
have begun to snap out era Io~
stall. beeking strong gains in tl
company's second quarter.
For the three months end~
December. Playboy's TV oper
tiGriS boosted revenues 21 pc
cent. to $6.8 million vs. $5.6 m
lion for the same period aye,
earlier. The company said th
ita cable pay-per-vmw revenu
rose lyecause of the switch fi'o
a part-time service to a 24-ho~
netwm'k. Also. sales to sateIll
dish customers -- both C-bat
and direct-broadcast satolfi
positive Iirst step."
Stone in the cohle indnst~T
were surprised and delighted
about the hold move to lift rate
regulations.
"We didn't ask fi~r it. TimCs
the irony nfthaC' said Stephen
Eftres. president nf the Cable
Telecommunications Associa-
tion.
"It's certainly a strong foun-
dation," said Bert Carp, vice
president of government affairs
for Turner Broadcasting System
Inc.
Eftres said cable might even
resist inclusion of broad rate
deregulation because of the po-
litical stir it could cause.
Presslet's draft ~ould lift
broadcast starlea ownership
caps and allow broadcasters to
use high-definition spectrum for
pay services if broadcasters
eompensatsd tile govm'nment. It
would lift foreign ownership re-
strictions of U.8. media proper-
ties under a reciprocal test.
It also would allow the Baby
Bells to enter long-distance and
telecom equipment-making
markets in one to three years,
provided the seven Baby Bells
have complied with rules that
prescribe the terms of opening
local exchanges.
Willful noncompliance with
the bill's interconnection man-
dates could cost a local phone
company $1 million per offense,
per day. Other noncompliance
penalties could reach as high as
the herden ol Im.,I m planroll.',,
not phone coalpanics.
The hmg-distaocu nnd manu-
fiteturing provisian would elbn-
inate tbe coort decree -- the
Mndificntion of Fbml Judgment
~ME,D -- that broke up the old
Bell system in 1984.
The lobbing group backed by
AT&T Co~. and MCI Commu-
nications Corp. -- the Compet-
itive ~ng Dis~nee Coalition --
said the Pressler bill on Belt en-
try into Iong-dis~nce provided
no assurance that local phone
markets wo~Id bo open simul-
taneously. They objected to a
provision that specifies a "date
cemin" for mice ent~ into Iong-
dis~nee.
~I would rather see the time
that RBOCs could enter other
~arkets tied to how quickly
they perform in opening up
their markets to competition,"
said MCI OEO Be~ Robe~s in
a speech to the Atlanta Cham-
ber of Commerce.
Tbe Baby Bells released a
joint statement suggesting the
bill was lopsided in favor of
long-distance and cable compa-
nies.
'Whis drag provides co~inty
for others. but does not provide
co~inty of timing for Bell com-
panies," said Gary MeBee,
ehaiman of the Bell-backed M-
lianee for Competitive Commu-
nications.
Presslet's plan embraced key
lobbing objectives of the cable
and perhaps impese new fees on
cable operatars that provide
phone service.
Telcos offering video dialtone
would not be required to obtain
local franchises but could be re-
quired to pay franchise fees.
Telcos that opt to build cable
systems would need franchises.
The plan would force the Fed-
eral Communications Commis-
sion to suspend consideration of
VDT applications; approved ap-
plications would be de-autho-
rized for one year. But a year in-
to the new law, telcos would no
longer need FCC approval to
build video network plant.
The bill could put cable at a
competitive disadvantage.
While nothing in the bill would
impede Bell entr.v into cable, lo-
cal phone companies could drag
out intercoanection fights at the
local level for up to 22 mouths
and stall cable entry into tele-
pbony.
"The interconnection lan-
guage needs to be tightened up
substantially," TC['s Thomson
said. But he called this and oth-
er defects "nits and gnats" to be
dealt with later in the process.
Pressler said he had the sup-
port &Senate Majority Leader
Robert Dole aud all Commerce
Committee Republicans. An aide
to Sen. Ernest Hollings ID-S.CA
the ranking Democrat on Com-
merce, said Hollings planned to
reply by Feb. 14. .--air.//
Cable Executives Storm The Hill
By DAVID KAUT
WAS[I~GTO~ -- Cable officials fi'om around the
country converged on Capitol Hill last week to press
for telecommunications reform legislation they say
is critical to the industry's future.
And while most operators said the meetings
seemed cordial if not routine, one official, William
Cologle, president of the Pennsylvania Cable and
Telecommunications Association, got an earful.
Cologle said he was told by Rap. Bob Walker (R-
Pa.I that "we can expect to see reasonable but rad-
ical changes at the FCC."
According to Cologle, Walker said House Speak-
er Newt Gingq-ich ~R-Ga.I ired even suggested at a
recent dinner with telecommunications executives
that the Federal Communications Commission
could be abolished 'q~ecause there a lot of things be-
ing done at tim FCC that cnuld he better handled
by the states."
Despite the apparent "paradigm shill," Cologle
said, "I don't think they're advocating zero regmla-
ticns."
At deadline, neither Gingrich nor Walker could
be reached for comment.
Elsewhere, operators passed the "message was
that we definitely want to see a bill pass and that
we're willing to help get it done," said William Law-
son, government affairs dfiefofTCI Cablevision of
Washington.
The lobbying effort was part of the National Ca-
ble Television Assoeiation's Washington legislative
conference, which NCTA said attracted about 300
representatives from operators and associations in
42 states.
"[Turnoutl even ekeceded some GrOUt expecta-
tions," said Rich D'Amato, NCTA's public affairs
chief. "We were the last ones at the table last year
and wanted to be first at the table this year."
But some on Capital Hill are already reporting
heavy lobbying from cable competitsrs. The aftice
of Rap. Jack Fields IR-TexJ, the new chairman nf
the key House telecommunications subcommittee
-- has been "mobbed" hy telcos. Iwnadcasters and
athers since early dnnuatj,. a spokesmnn said.
Stairs Ncu,s Sert,k~'
NI~ YoltR -- Nickeledco
last week opened it. kids upfm
market and closed major de;
with Leo Burnett Co.. Grey A
vetrising, Toy Biz and annth
major toy manufacturer, said
Popkowski, executive vice pre
dent of MTV Networks Advert
ing Sales. psHe wouldn't quant
the dollar amount on the deals, l:
one source pegged it at rougk
$50 mill/on. Nick came out aski
for price hikes in the low-20 p~
cent range. The agreements wi
Grey, Leo Burnett and Toy
were for t~vo years. Popkowski
dined to identity the toy makro
WASHINGTON -- Sen. Byr~
Dergan ¢I~N.D.~ last week said
intends to offer legislation requ
ing the FCC to prepare TV violet
report cards qum~erly. He's alma
intn~luced a bill requiring violet
blocking tecbamlogy in TV sets.
ENGLEWOOD, COLO. -- Te]
Communications Inc~ compl,
ed its acquisition of a 10 perce
stake in computer game puNis
er Acclaim Entertainment h
TCI put no cash into Acctai~
with the companies simply c
Pinyboy Cnble
CHICAGO -- Playboy Entt
prises Inc.'s cable networks sal
have begun to snap out of a 1o
stall, booking strong gains in t
company's second quarter.
For the three months end
December, Playboy's 'IV opm
tiens boosted revenues 21 pc
cent, to $6.8 million rs. $5.6 re
lion for the same period aye
earlier. The company said th
its cable pay-per-view revenu
rose because of the switch fro
a part-time service to a 24-ho
network. Also. sales to satalii
dish customers -- both C-ba~
and direct-broadcast satetli
PCS Biddin
W~sml~(n'os, D.C. -- Biddi
on new wireless-service licen,,
should enter the fiual stage tt
week after nearing $4.5 billi
in slow growth.
The Federal Communicatio
Commission .mid it expt~t~
to increase the amount bid&
must commit in order tn remain
igible. The leading hidder hy fin
WirelassCo L.P.. the group
COMING TO TRIAL~ FINALLY
The launch of interactive ~rials by
cable and telephone companies
will make a big splash this year.
Although technical and regulatory
delays caused setbacks for many
of these tests last year, z99~ w~ll
see many of the planned trials,
such as U $ West lnc.'s in Omaha,
Neb., and Tele-Communications
Inc.'s and Microsoft Corp.'s in
Seattle and Denver, finally get un-
der way. All eyes will be on Or'an-
do, Fla, this year as Time War~er
Cable's Pull Service Network be-
gins to yield market research in-
formation. But don't look for this
company or others to share re-
suits widely.
: I'N $1 DE-'B [J $ I'N'E S S
A Study
In Contrasts
It was a joy to wa ch Tele-Coinmunications inc. trea-
surer Barney Sohotiers back in action as his cmll-
pany's represeraadve al a recent PaineWebber media
cooference. Except for John Malone. the stralgtm
talking ,Sobotters is TCI's most articulate and effective
spokesman.
In both style and subsrace, Schouers offered a sharp
contrast with Time Warner Telecommunications presi-
dent (and former FCC chairman) Dennis Patrick. who
preceded him on tile program last month.
Schouers won the style battle, but consumers ~ deter-
nfine which of the two companies has the better substance
in teleconununications. Clearly, TCI and Time Warner are
heading in very different directions.
Both companies appear to agree on one important
point: Entry. into telecommunications by
cable companies will begin thrnugh wire-
less technology.. be it cellular. PCS or
ESMR (still the exclosive donlain of
Comcast). Assuming regulatory. barriers
fall. wired comnamications can come later.
Said Malone in a speech at the University
of Colorado last month. "Our preferred
choice is wired lechnology, but we just
don't know when we might be authorized
to go fom'ard."
The wireless approach. of course.
hinges on use of specmnn. One of three
substmrtive differences between TCI and
Time Warner relates to that spectrum.
P, qth partners Cox and Comcast. TCI is
allying with Sprint to purchase spectrum
for its exclusive use. '5% cannot imagine
aot owalng and controlling spectrum wheu
it's going to be a significant pan of our busi-
ness." Schotters told the PaineWebber
audience.
Patrick used exactly the '.~une word--"siguilicant"--
in descril:,ing how telecommunications would afteel Time
Warher's nunllyers "in the near to interim temC'That tenn,
he says. will be over the next two or three years, when
'Firlie Warner expects to roll oat wireless telecommuni.
cations .':,.e p:ices in at least 10 of its principal clustered mar-
kcts. II i.', offering snch services in Rochester. N.Y.. and
will so{m lit' doing so ill New York City.
'D~ Izain specdy ruarkel entry, Time Warner will use
cclbflar Iccbnolngy. Since each market bas but two cellu-
lar licensees, there is little choice except to buy wholesale
blocks of air time from one of them and re-sell that time
to celhdar customers.
In so doing, of conrse, Time Warner won't ovm the
spectrum and will be at the mercy of two extant landlords.
So far. re-sellers haven't had a problem in getting one of
the landlords to sell air time. But no reseller is as large or
powerful as Time Warner. Tile last thing any cellular
licensee wants is to lose significant market share to an
upstart that's buying Ilis air time. Patrick says this won't
happen because the markets will all grow exponentially
once consumers take wireless telephony to heart`
Time Warner, says Patrick, is more concerned about
buying time itself than about buying blocks of time. With
two incumbents already ensconced in every market. once
you get beyond a third service provider.
Patrick doubts there will be much room
for anyone else.
Not so, counters Schotters, expressing
the second difference beb, veen the two
companies. In Schotters' view, "ffwe get
just a five percent market share, we'll get
all our money back plus an excellent
return." He thinks "you can sustain five or
six competitors in a wireless market."
The third major difference is product
branding, something many cable operators
will have to think through carefully ff they
decide to diversify. Tune Warner's cellular
product carries the Time Warner name,
which Patrick says "has received very pos-
itive reaction in all our market research.~
Eve,wthing from cable and telephone ser-
vice to Bugs Bunny souvenirs will be mar-
keted under the Time Wame~ umbrella.
In contrast. TCI will rely on Sprint's
name when it enters wireless telephony
through the PCS door. Sprint wasn't TCI's first partner-
ship choice. or even its second. But it was the best avall-
uble under reasonable ternis. As an aside. a new Bear
Sicams report relates that Malone was rebaffed by his old
friends at AT&T and McCaw when he earlier sought to
invest in the alliance between those two cmnF, anies.
For Imny cable COl'flp~ulies, il may be wise to lel a well
cslablishcd Mellbom' .wryice pr{widcr can3.' your banner.
'['bne Warner. bowt.ver. nlurcbes to a diffcrcnl dnmuncr.
t.'m,p an eye ml developrecurs in Rochcsk, r. ly~
CABLEVISIOff . JAHUARY
9, 1995
41
NEWS
from the U.S. Senate'
COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATIO
Wednesday, February 1, 1995
Contact: Joseph Duggan (202) 224-1251
home: (202) 363-7002
$TATEMIgNT BY THE HONORABLE LARRY PRF~SLER
CHAIRMAN, UNITED STATES SENATE
COMMITTEE ON COlVI~ERCE, SCIENCE AND TRANSPORTATION
AT A PRESS CONFERENCE
PRESENTING THE CHAIRMAN'S DISCqJ$SION DRAFT
OF THE TELECOMMUNICATIONS COMPETITION
AND DEREGULATION ACT OF 1995
FEItRUARY I, 1995
The draft legislation I am making public today brings America a big step
closer to a whole new dimension of competitive and creative freedom for one-tenth
of our economy. The teamwork and energy that produced this draft makes me
more confident than ever that Congress will enact a major deregulation bill for
telecommunications during the first six months of this year - maybe as esrly as
Easter.
We keep hearing from naysayem They will keep trig to drown out our
message with their static. Well, let me state the message as clearly as I can:
America is ready to tear down the anticompetitive barriers that keep consumers
from having all the ehotces they deserve. We're now ready for bipartisan
movement to give Americans these kinds ot freedoms:
02/2_3/95 THU.).~:02 FA,~.202 228 4?02 ~00;
* Freedom to choose among competing firms offering local phone service,
luciacling cable T~r firms in competition ~vlth traditional phone companies;
* Freedom to choose among cable services, including phone companies In
competition with traditional cable firms;
* Freedom to choose electric utility firms to provide telephone, cable or
other telecommunications services.
And these name but a few of the new competitive freedoms our legislation
will make possible.
The I~reatest mistake one could make in evaluating this legislation is to
focus too much on how it will affect existing companies, eftsring markets, or
existing technologies. The most important effect this legislation will ha'~e is to lift
the barriers holding back the creation of new companies, new markets, and new
technologies.
This legislation will give new freedom, and new legal and regulatory
certainty, not only for established companies .- but also for ups}arts whose only
asset is a dream. It's time to give this freedom to the creators, the competitors,
and the consumers of America.
02/23/95 THU L$:02 FAI 202 228 4?02 ~004
Chairman Presslet's
TELECOMMUNICATIONS cOMPETITION
AND DEREGULATION ACT OF 1~9S
"Discussion Draft" Summary
The i 04th Con~ress has an historic opportunity to pass comprehensive
telecommunications reform legislation. The Chairman's "discussion drY" contains a
pro-competitive, aleregulatory national policy framework for telecommunications reform
legislation.
Telecommunications policy always has been a bipartisan effort. This
cooperation will continue. Chairman Pressler pledges to work with all Senators, House
leaders, our nation's Governors, Vice President A10ore and the Adw~nlstration, and
with l~ders in the telecommunications and information industry to reform the
outmoded and antiquated "regulatory apartheid" system in order to make exciting new
information, .telecommunications and entertainment services available for America.
It is time for American policymakers to meet the challenge posed by the new
global information economy. The response must be rooted in the American tradition
of free enterprise, eoml~etition, deregulation, and open markets -- to let technology
follow or create new markets, rather than government micromanaging and stunting
developments in telecommunications and information t~chnology.
The Telecommunications Competition and Deregulation Act of 1995 will have
profound implications for America's economic and social welfare well into the 21st
Century. This new policy framework is designed to rapidly accelerate private sector
deployment of advanced telecommunications and infonmtion technologies and services
to all Americans by opening all telecommunications markets to competition. The new
policies will markedly improve America's intematinnal competitiveness. They will.
spur economic growth, job creation and gains in productivity.
Telecommunications legislation designed to meet these goals will be based on
the following principles:
1. National policy framework
2. Open and full competition in all markets
3. Open/equal access
4. Equal opportunity, not equal outcomes
5. Preserve and reform universal service
6. Promote federalism
7. Minimize, remove and reform regulations
8. No new entitlements
02/23/95 TItU,~$:0~ FAX 202 ~28 ~762 ~00~
9. No protectionism
10. Competitive neutrality.
Competition, not regulation, is the best way to spur innovation and the
development of new services. A competitive ~ket'place is the most efficient way to
lower prices and increase value for consumers. However, in furthehng the principle of
open and full competition in all telecommunications markets we must recognbx some
markets today are more open than others.
Lo6al telephone service is predominantly a monopoly service. Ahhou§h
business customers in metropolitan areas may have alternative providers for ~xehange
access service, consumers do not have a choice of local telephone service. Some states
have begun to open local telephone markets to competition. We need a natlonal policy
framework to accelerate the process.
Because of their monopoly status, local telephone companies and the Bell
Operating Companies have been prevented from competing in certai~ markets. It is
time to eliminate these restrictions, Nonetheless, transition niles designed to open
monopoly markets to competition must be in place before certain restrictions are liteed.
Transition rules must be truly transitional, not pmtectioniam for certain industry
segments or impediments to increased competition in all markets. Where possible,
transition rules should seek to create investment incentives through increased
competition, Regulatory safeguards should be adopted only where competitive
conditions would not prevent anticompetitive behavior.
The period for the transition to new competitive rules is generally three years.
In Phase I, the first year of the policy framework, rules would be adopted by the
Federal Communications Commission and the States to:
(1) remove barriers to entry,
(2) implement interconnection and opening requirements,
(3) establish separate subsidia.q, and safeguard requirements, and
(4) establish a new universal service support scheme.
I~ addition, foreign ownership 'limits in the 1934 Communications Act will be
reformed on a ~ecipmcal basis. The Commission and states will also be.permitted to
forebear from regulating where markets are competitive,.
During Phase II, at the end of one year of the policy framework:
(1) state and local barriers to entry would be preempted,
(2) the MFJ restfictions on incidental services and out-or-region long
02/~/95 THU 15:0~ F~'i ~02 ~28 4782
-3-
distance would bc lifted,
(3) the cable-telco prohibition wo~d be eliminated,
(4) cable rate regulation would be tenn~ated,
(5) utility ent~ into tcleeommunicatlo~s markets would be permitted,
(6) spectrum flexibility reform for broadcasters would be implemented;
(?) broadcast ownership and stmc~al rule reform would be ordered,
At the end of three years:
(1) the MF,r restriction on long distance and manufacturing would be
l~ed and
(2) short haul long distance competition would be permitted together with
dialing p~ty.
Fimlly, in Phase IN of the policy framework, Federal and state regulators shall
establish price cap regulations. A bi-annual regulatory review process would determine
the conQnued necessity of all remaining federal, state and local regulations.
Incentives for deployment of advanced tclccommunicatlons will be employed in areas
where competition does not occur. The Commission would be directed to streamline
and harmonize regulatory treatment of all telecomm~_mications providers so that
providers of similar services are treated the same.
Chairman Presslet's '
L
Telecommunications Competition.:.:.:
and Deregulation Act of '1995 "'
Phase
Phase 2
Phase 3
Transition to Compegton
(One Year)
Tvan~llo=~ rules adopi[on, ~plementation
and expediled judicial ~v~ews pmc~s
· 'N~u~ted ~te~onnectio~opc~ng
r~~s upon ~qu~ wHh s~te
~1o~ ov~ight
o [nte~onncctlen
- UnbundHng
· R~le
'- Number Por~bifity
· St~mEn~ & consolidated safeguards
- Sepa~e ~s~tlla~ safeguards
- Fen~ll~ ~or xd~ noncompE~ce
- Dia!in~ parity
- Rev~ uaive~ se~ subsidy scheme
- All compefito~ contribute
. ~nfial~lec~mm~ficatlons Cartiere
- Make implicit ~sidi~ explicit
- Subsidy Refo~a
- R~ulalo~ forb~ace
- Fore~n ownerslap
Remove Barriers to Competition
Shot Gun
One Year Trigger
o Preempt state & l~ b~
- Remove cabie-ieko proifib~on :
~ Cable ac~ refo~x
- Spectru~ ~form
- Broadc~ ~le
- lncidcn~
- Oul of r~ion long d~!an~ r~
Three Year Trigger
- Permit ~[o~ haal long
comp~ilion
- R~zo~ tong dis~nce ~J
wi~ no dem~lic content p~visiu~
· Requi~ dialog pa~ity ~oncur~nl
wit~ long d~ance ~!ie[
- Pemit acce~ted t~etable
~rly c~mp~an~
"' An End to Reg~dafion
· l~centive Price Cap
Ragu]alton
. Bi-Annual Regulatory Re~iew
· ~orbenFnnce and
~fion~ ~e ~p~
· inc~tiv~ f~r deployment of
ndwnced t~nologl~
- ~e~lato~ Parity
02/23/95 T~U 02:39 FAX ~
Broadcasters are
video dial-lone systems
COS ~. ·
Pole Attachments '
The Draft requires
rates for their use of
one ~eparata Subsidiary
permitted to obtain preferential icdeJ~ to
and rates no hiqher than the incremaatal
all users of p~les to pay at ~hs same
The Draf~ permits [he carriers to use.one separate
subsidiary [or all %heir non-telephone businesses.
~HASZ III ~ TO
P~iqi~q Flexibilit~
Talecommunicatxons carr£a~s that faca compe~it£on shall be
q~anted pricing flexibility.
RegulatO~ForDearance
The draft allows ~he FCC to waive requirements of the
Communications ACt of 1934 when enforcement of the provision is
unnecessary ~o satisfy the public in~erest.
Waiver o~_Separate Subsidiary
The FCC may waive ~he separate subsidiary requirements whe~
in the public interest.
wg~ver of,Joint venture or 8uxo~.Provisions
The FCCmay waive the prohibition of the joint venture or
buyou:s between cable and telephone companies in the public
interest.
Regulatory ~evie~
The FCC shall review its regulations eve~7 two years
repeal those tha~ are not necessary in the public interest,
Transfer of MFJ_and .~T~ Consent_Decrees
The Dr~£t transfers the administration of the MFJ and
C~nsent Decrees tO the FCC.
02/23/95 TfiU 02:39 FAX ~003
the states may waive certain unbundlinq requirements for rural
and ocher small ~eyephone companies.
Lo~q Distance
The Dra[t requires the Ball operating companies to unbundle
their local telephone networks before they are permitted into
lonq distance. RBOCS must ~eceive approval of the FCC (under
public interest t~st) and the Department of justice (under the
VIII(C) test). The ~BOCS must provide long distance through
separate subsidiary.
Manufacturinq
The Dra[c alkows t~e ~BO¢S into manufacturing one year after
enactment, as in the Hoklings manufacturing bill that passed the
senate 7~.24 [n 1991. The RBOCS must engage in manufacturing
chrough. a separate subsidiary. The Draft contains a domestic
content provision chat requires the KBOCs to conduct their
manufacturing in the U.S. and requires them to use U.S.-made
components.
Elect~on~c_P~bl~shing
The Dra£~ recrui~es the ~OCs to provide electronic
publishing services using a separate subsidiary. The Draft
requires the RBOCS to make ~heir network.available 'on the same
terms and conditions co all electronic publishers, including
large newspapers, small newspapers, and other electronic
publishers.
Burqlar Akarm Services
The Draft prohibits the RBOCs from providing burglar alarm
services for 6 years, under the terms of the agreement between
the RBOCS and the burglar alarm industrY.
Telephone zntr~ into Cable
The telephone companies are allowed into cable i~nediatelY,
with no moratorium. The telephone cofi~anies are permitted to
engage in joint ventures or buyouts with cable companies in area~
with up to 100,000 persons.
Telephone Entr~/ b Ut~ ,
-- 'Except for pUffCA u~ilities, the Draft allows utilities ~o
provide telecommunications usder a separate subsidiary.
BroadcastJr Provision of NeW $e.rvices
The Draft permits broadcasters to provide .ancillarY and
supplementarY" services after they i~191ement High Definition
Television (HDTV).
02/23/95 T~U 02:39 FAX ~o0
SUMMARY OF DEMOCRATIC DRAFT OF
the UNIVERSAL SERVICE TELECOMMUNICATIONS ACT OF 19.95
February 14, 1995
The Universal service Telecommunications ACt is based on
three principles:
First, the protection and advancement of u~iversal telephone
service is absolutely essential to the economic growth and well-
being of our Nation. Second, strong measures must be taken
allow competition to develop ~or all communicatiohs services.
Third. deregulation of competitive markets will promote
inves%ment and remove unnecessary government bureaucracy.
PI{ASE I - PROTECTION AND ADVANCEF~EN~ OF
Oniyersa~ Service
The Ora(t requires all telecommunications carriers to
contribute to universal service, including competitors. The
ora[t encourages subsidies to be explicit and targeted to those
who most ~eed the subsidy·
Disabilities AccegA
The Draft requires telephone companies and others to make
their facilities accessible to persons with disabilities.
Consumer prqteq~ion
The Dra(t ensures tha~ rates for residential telephone
service will remain just0 reasonable, and affordable as
competition develops for local telephone service.
P~.ASE II - TRANSITION TO COMPETI~ION
Removal of Barriers to Entry
The Dra[t removes sta~'e and local legal barriers to
competition for local telephone service one year after enactment.
~nbundlinq
To remove the practical barriers to competition, all
telecommunications carriers with market power must un~undle th~i~
networks. Carriers mu$~ complete their unbundling withi~ ~hree
years after enactment, the same time frame set forth i~ the
Presslet draft bill. carriers may satisfy their unbundling ,
obligation by reaching negotiated agreements.
Rural MarketS.
States may require competitors i~ rural markets to serve the
entire service area of the rural telephone company°
The smartest telco CEO, Bell Atlantic's
Ray Srnit h, reveals what
really torpedoed his merger with
Pointl Last year, Wired's David Kline snatched an amazing interview witl~ the
John ~talone's TG, why the t~t,cos are
cowboy of cable, TCl chief John Malone. The mogurs uncensored revelations
going to kick cable's butts (and
about the collapse of his US$33 billion merger with Bell Atlantic Corporation -
where their real competition wH~ come
not to mention his audacious jest about shooting the chair of the Federal
from), and precisely how ~'he I-',v~y is
Communications Commission - ignited controversy (Wired 2.07, page 86).
going to reach your home.
Caunterpointl Now Wired has returned Kline to the gladiator arena, this
time to the opposing corner- that of Ray Smith, CEO of Bell Atlantic. Clearly
By David Kline
the most enterprising and farsighted of the ~ e first to
once-stodgy utility to a more entrepreneurial footing.
Smith enjoys poking fun at his old monopolist image as much as anyone.
On the white board in his office he wrote: "1) Buy AT&T 2! Sell Pennsylvania
3) Retire 4) Work for IBM (depose Gerstn or) $) Cancel subscriptions to all
magazines and newspapers."
Here, then, is what Ray Smith, the titan of telephony, has to say about John
Malone, the t~hcom wars, Jane Seymour (yes, Jane Seymourl, and whaf the
broadband network In your future is going to look like.
WIREO FEBRUARY 1995
Wired: So, what's the plan? Are you going to buy AT&T, or st
Pennsylvania?
Smith: No, don't use thaL [ put that tip just to amuse you. All we
need is to have a rumor going around that we're going to sell
Pennsylvania.
I can imagine. Even John Malone said that you telco guys ar
the real monopolists.
Yeah, in my career l've come to know a number of humble. one-
shoe-over-the-other billionaires.
~o you're not a monopolist, and you have no near-term pla~
to sell Pennsylvania?
Absolutely noL
I see.
We're gonna sell West Virginia.
[Laughs.] Well, now that we've got that settled, can we talk
about Bell Atlanfia's aborted merger with TCI? People still
want to know what really happened the day the biggest den
In American history crashed and burned.
You know what amazes me?There were only four people in the
room that day, but there are at least twenty different versions of
what happened. It's like the movie Rashomon.
Well, Malone said the merger was aborted because you
David Kline (dkline@aol.com) and Daniel Burstein have writtet
The Living Room Wars, to be published this fall by Dutton-$ign~
couldn't get your board of directors to go along with the deal -
they were skittish about c~anglng from a regulated uttiIty Into a
high-groWth company.
No. thags absolutely not true. The entire board was in favor of it.
There ',vasn't.a single voice against iL Let me tell yell what/~ true.
Tilere was a struggle in the shareholder base. We have a millian
shareholders, and they are high-y/eld-oriented. We froze the dividend,
and it frightened the life out of mir shareholders. And our sleek,
which leaped fur a while on the promise of the merger, dropped as
the yield-oriented shareholders pcaied awa):
So, [he strugg{e was really in the invesLmcnl commnnftv. II was not
a debate on our board about whether Io change into a high-growth
company versus a low-growth cornpan): My cash-flow grmvth is
faster than John's!
i'm not trying to say we didn't have cuhural differences in terms of
TC{ being more entrepreneurial But the issne was, ho~v do we get
tile cash out of our company to complete the deal without scaring off
our shareholders? If you cut the dividend too much, the shareholders
{eavc, and the slock drops so low you can no {eager do the deal.
But you knew you faced that problem going in.
{ knew it going in. { knew it'd be a sLruggh that we'd have to handle
with some sensitivity. Unfortunate{y, it became pub{Jr. At one point,
John was quoted as saying we'd have to cut the dividend in the future,
and the stock dropped five points.
Why'd he say that?
IShrugs.] He thought that was what we had to do. John was just being
get my major shareholders to accept iL A,nd there's no way you can
give me the number orshares { need. You d be paving 14 limes cash
flow." And [ said, "You're right?
Finally, he said, "'/&ti, we cnn't just sit around here forever? And I
said, ~'¥eah, let's look at the press releqse and get this over with."
What's your strongest memory of that last meeting?
{Pause.~ { oness it's tile last words he said as we separated. tie said,
"Nice try, my friend."
You guys really like each other.
We do.. We're both old techies. and we get ale ng very wall John and 1
were Just on a Networked Ecanamy Conference panel together, and
we wer. e standing at the urinals talking about things, and Barry DiUer
comes m and stands between us. And Bars' says, ~C'mon, you seem
like such good friends. Just split the difference."
[Laughs.{ What does the failure of the merger tell us about the
strategic-planning capabilities of big companies like yours? One
day you're spinning together these huge deals, and the next day
you're taking them apart and going about your business.
.-~ctually, I think it's positive, It shows that although we had a good
slrategi¢ idea in to, ing to merge with TC[, when the conditions
changed, as the)' did, we were willing to pull back. You don't just stick
to a deal out of sheer, cussed egotism when it's no longer good for the
shareholders. Cutting mergers is a hard thing to do.
And you knmv wharf ff[ could get the same deal today that [ agreed
to a 3'ear ago, I'd sion it right now. Right this minute.
What if Malone reads this in Wired and calls you up and says, "OK,
"You don't just stick to a deal out of sheer egotism when it's no
honest. But to say it like that is like lighling a match in a gas-filled
room. Not that you aren't going to tell shareholders the truth. You are.
It's jnst that we were trying to find less onerous ways of making the
deal work financially. Why announce something like that before you
know ~or sure?
You see, John's approach to this issue was like his regulatory
approaeb. lie didn't say, "Shoot the shareholders" - don't quote me on
thai - but he was sa. ng, Les lust go cul tile dividend. John, being tile
road warrior you pictured him on the cover of lYirecL just wanted to
get it over with. But that's not how you deal with regnlation, and it's
,n,I how you des with a large shareholder base.
i'm more era builder. An arcbitecL I like to do things one brick at a
Inne. My ~ iew is, Align and conquer.
$o what finally killed the deal?
J ~hns cash Ilmv went down. Remember, when we set Hie deal, John's
cash flow was at $~00 a subscriber and w~ agreed to pay him about
11.15 times cash flmv. But there was a cash-Ilow tesL ff his cash flow
were to go down, as it did after the FCC cable-rate rollbacks of Febru-
ary 1994, then I would give him fewer shares of my stock, which had
a lixed price of $64 in the deal.
Now, by FebfeRry 1994, becanse ortho declining cash fimv, the
~al.e of TCI sleek was hy then dropping close to $20 or $~1. I was
with,g to pay something like $I]5 per share. But John still had it th his
bred thRI it was a $35 stock. That's just too big a difference,
FU tile {inn{ meetfug, we kept trying to figure out some mvay to make
it work. John said, "ff [ take this reduced number of shures, I'l[ never
Ray, you're ertl"
I'd take it. Exactly as [ signed it a )'ear ago.
flee, as a finder's fee I'd get something like $50 milltoni Of course,
Wired would want a piece of that, no doubt. In any event, many
now say the collapse of the merger shows that the info highway Is
way overhyped. What do you think?
There was a lot of hype before the merger. The media was full ofiL
But for all the hype, there was also a lot of naysaying.
Still, [ do think the merger auoouncement moved things forward.
Tile mmnent it hit, there was uo way Ilia[ anyone cuuhl say that it all
was just hype. or that tile whole re,lion af Ihe in fo bighwai- was silly,
The naysayers were last swept away.
You mean, the naysayers in your company?
Not so much in our company. Bentember, we were the first of the
regional Bell rompaRies to see it coming. We very eonseiously set out
to prepare for it FU 1990 when we filed tile court case to change the
Cable Act of 1984, which barred telephone companies from mvnthg
the video programn ng they delivered.
And you know, when we launched that court case, we offered it to
oil of the other telepllono eompnnies, inchiding GTE. None of them
saw any need to get inlo the video indnslry.
And the merger changed that?
l; really began to change whcu we ~von the court case in ~993. Before
th. al, there Was nat mm single pracnrement by' the uther Bell respa-
roes concertling viden. Tilere was no snppm't of ADSL [asymmetric
digital snbscrther line, a way Io send data dmvn a phone line{. There
FEBRUARY 199S
were no hybrid fiber-coax discussions whatsoever among the nlher
phone companies.
Now, t happen to knmv there were lintties withiu at least four of the
seven Bell companies over whether video was practical. ^ lot of dis-
cussion along the lines of, We'll never be able to make il pay, We can't
do it, that type nf thing. The'/were in the ")'es, but" phase· Ouce the
court case was won, that was the end of'qes, but." ~ey all called and
said, ~,~,'e want to get ante this. Even then, there wasn t critical mass in
most of the telephone industry to move forward on video.
But tile day after the TGI merger announcement, there was. Sud-
denly, video'became a necessity. The top decks of all the Bell camps-
hies knew that, at the very least, they'd have to get into the video busi-
ness because cable was gniug to get thio the telephone business,
Tilere was no argument any more. It wasn't whether we should do
it, but how we should do it. TiLe announcement changed the picture
so much that the merger became less neeessen.' for us. Because one of
the motivations for the merger was to get enough scale to bring equip-
ment costs down. Bul when all these other companies suddenly
jumped in after the TEl deal with their own infrastructure
investments, costs were going to come dowu anyway.
$o while many alebankers, especially in the media, point to the
collapse of the merger as proof that all this is hype, the evidence
shows it moved things forward. It was like a demonstration atomic
bomb. Of course, then it became not only conventional wisdom, but
eonvenlional wisdom times two. We were iu hyperspace, ~nd we were
all going to have talking television sets by the end of 1994.
The typical Amidcan family h~sthe tube ~umed on n~ady:
Listlos don't change from yeer to y*~r/nd fikely nev.r will In
p.opl. to Splnd mar. tim. I.'front of the s,t.
sbly n zeta-sum game," s~D Mlcfii$l L.sky, dlrictor of dlgl~l
.. productl.nforh iatl~nfi~VId.o:h~lc.s'Com~ifiy.
t6 see the · ai~¢. ~ls Is'g~= und zero for · mu~h
· ~mmll roomsp~ck~ with PC~ ~ w~llms wavMbrm manlion,
ger good forthe shareholders:' .t;;af.Smith::The I.way,.My
·
' ' "ByEvan'Schw
And Time Warner's Full Service network in Orlando was going to
be up and running in eerly'94, remember?
Yeab, they were saying they had solved all the technical problems.
Well, sure, they solved the technical problems. But the set-top was
$11,000! So now it's $5,000. Big deal. I mean, the issue is, can you do it
at a price that people cau afford. so it can be deployed in the real
world?
Anyway, the merger annouucemenl served its purpose. It moved
filings forward.
and Its abandonment four months later kick-started the war
between the cable and phone industries that we see today. What
do you think about the conventional wisdom that says the telcos
will probably lose 30 percent of their market share to cable-pro-
vided telephony services, while cable could lose '~0 percent of its
video business to the telcos? I mean, cable executives say that's
fine with them, because their 30 percent is going to look a lot
sweeter than your 30 percent.
Oh, for Christ's sake! This nation that cable companies are going to
get 50 percent of the $100 billion telephone basiness. whereas we'll
get ertl) 30 percent ofcable's $;tO billtun business ~ that's ridiculous.
Bell Allanlie is not one busiuess but I ~ different businesses, most of
them hal subiecl to any real competition frmn the cable indus.'.
11BOCs get a billion dollars of our revenues from the federul gov-
ernmeal. }~u're saying cable's going Io take cur ~5-ycar contract with
the Pentagon? Nonsense! Cable campantes aren't gothg Io touch thaL
Or look at the Yellow Pages. If the cable companies offer local tale-
;,
[lone services, is that going Io affect our 'fellov,' Pages business? Add
~e they going to compete for our life-liue services?
'h, I'm sure they're dying to got their hands on thatl
![ghL we're quivering ire our heels waiting In see a cable company
i~ome into New Jersey and offer local phnne service for $6.50, So the
&more you look at it, the more the percentage of our revenacs titat are
[.'really subject to cable competithm keeps shrinking. Of our S15 billion
? in total revenues, only $4 billion of that - the consumer business - is
3/ubject to competition from cable companies.
~ Now, the cable companies in our territon.' also have abeel $4 bil-
[~;[1on in revenues. But while we cover 100 parcera of their customers,
~.they cover onh' ~0 to 70 percent of our customers (the telephone-
,. using homes that subscrtbe Io cable 1 ~ semce). So there ~s only
.:'] about $5 billion fltey can try. to get their hartds on.
But how successful are they likely to lie? Consider liter Philadel-
phia, for example, is so,wed by maybe 10 or I I ,,'able cronpanics. Even
inside the ciD' there are four different cable companies. Fnar!
Now yon're telling me a consomar is going to subscribe v, ith a
cable-phone sen'ice titat serves only one section of the city? %at's
.: going to be a pretty hard sale. And wbat about pov. er? Remember,
7' when the power's out so's your cable phone!
'.'So, this 30 percent versus 30 percent.
'[ It's wrong. It won't be dollar-for-dollar. It'll be 10-tod ill o'dr favor. I
:: would say that by ~000, we!11 have 50 percent of the cable TV business
- no doubt about it, which is why some cable companies are in a pao-
i ic. Meanwhile, the cable companies won't bave even 5 pertcol of tale-
As For the bmud. we can create Jl. Ifil cnsl money;and il ',von'l be
as quick as if we had M Cl wilh us. tiut we rau create a nalimlal Immd
that's tip th the 60 percent range ~ ithin a yrar in lenns of rec.gnilinn.'
maybe up to 85 percent Jrr Iwn years.
go have you given up on M¢I?
MCI needs a wireless strateg_v. They line tn Ire can necl[,d with n cron-
pony thai bas a wireless presem'e. As for what may nr may nol hap-
peu, firat certabdy isn't goiug to be talked abaul
You've laid out some of your competitive advantages over the
cable industry. But you also have ~ome disadvantages, don't you?
For instance, whereas cable firms have already laid their coax -
80 percent of the cost o~ building the network - don't you still
have this massive coast ruction job in front of you?
We've been eqnipping our net`'sork for years
But i'm talking about laying coax, especially that "last mile" to
the home. Look what happened to Pacific Talesis in Milpitas,
California. When city officials there saw that PacTel planned to
dig up 60 miles of city streets and disrupt businesses for months
-just to lay coax to 1,000 homes -they refused to grant construc-
tion permits unless PacTel forked over Sl million in remunera-
tion. And that's just one city. So how easy is it going to be for the
phone companies to go into thousands of towns and cities
nationwide and get similar permits?
Well, I think Milpitas was an anomal.~ We koow Imw to buihl so you
hardly knov; we're there. We brae a eaostrnction permit for Dover
[the township in New Jersey thai is the site of Bell Atlaotic's HI'st cron-
"lily 2000, we'll have 50 percent of the cable TV business."
phony revenues in their Irest market. Not in their best markel. It's just
not going to Imppen.
But isn't your real concern here not so much that cable compa-
nies will take a big chunk of your total revenues, but that they'll
cherry-pick your most profitable businesses, like your S3 billion-
plus local access services?
We've aircad)' got competition there. No, cable is not where our real
eompetitiou will come from. The competithm's going to come h'om
AT&T and from wireless, not frnm cable companies reequipping their
ancient and crappy systems.
But now TCI and two other .cable firms have hooked up with
Sprint Corp. to bid on wireless personal communication services
spectrum.
Bidding is doe thing. Building a tndy robust and competitive service
is another.
,Well, your wireless business has certainly gotten more robust
lately. By combining with Nynex, AirTouch Communications, and
U S West, you've now got the biggest wireless footprint in the
country. But what about the failure of your talks with MCI?
Doesn't that leave you without the sort of national brand name
you'll need to compete with AT&T, or even Sprint-TCl?
For us, the most important thing is the footprint, not the brand name.
We estimate we need a rootprint that covers snme~ here around 150
million potential customers to give ns the scale to compete with
AT&T.
nmrcial interactive video service]. If.m~ polled the people in Dmer
and asked, "What cataclysmic thing is going on here?~ tbe.~ wr.uldn't
know what it was.
Maybe ',','hal happened in Milpitas was an overreactioa by the city
council or something. [o any case, r,e know bow Io build in a way
that would satisfy an.', cornmunih.'. It can be done with care. delicacy,
and with a little bit of explonatinu. Io ~,lorris Connty. Nay, Jersey. ifs
like the Persiau GulFWar or somelhblg, and ever.mac's :','aviog Bell
Adentie tings saylug, "Please come! Please'come!"
Cheering, no less?
Sure. because they see its as finally bringing deceat cable TV serxice.
We've had people calling ns, asking how soon tile.',' call sign lip for our
cable sen'ice.
I mean, look. I'm in .Montgomen.' eaudry, Marylaud. Just this week,
my cable TV service has been out for three days. Forlunately it wasn'l
out on Sionday when the Steelers were on. but il '6 alii ant Tuesday,
aad today's Friday! We get terrible cable sen'ice, really lousy service.
And everybndy says so.
But what's going to happen to your service as you make Bell
Atlantic leaner and mea net and more competitivet Look what's
happening with U 5 West. It's been reengineering, laying off
workers, and cutting costs to become more competitive with the
cable companies. And guess what? Colorado regulators have now
charged them with major violations of state service guidelines
because their customer service has gone down the tubes.
WIRED fEBRUARY 1995
V,,.ql, file) nlny Ilaw, gage over seine fine, lull,... Leak. jllst becanse
I' S ~'~l ba~ a conpie of prnblems. that (1oe~'t compare to e~
('able eonlpally hi the eOllnlry bcill~ the worst service provider in ~e
conlmlnlJly. [ no'all. { don'l rcmc{nbcr nly Iclephnne ever going gill o~
~1. ha~ c ~ood scr~ ice and { dn,'l scc th~ rhnn~in~. ~ have such
a cOnll)ethi~ e ndvalllage over cab{e because I)[I]llt S~I'ViCC repnlalinn
thai ~se'11 ~01 I~ percent .f ~ idea nlarkcl share easi{y jnsl by pillling
gel gilt shingle.
You know, all this do~nsiz{n9 raises an interesting point:
people say the info highway w{{{ ~eate Jobs, yet to compete {n
building it, the telcos have become the biggest job destroyers
in America. In fact, collectively, the Be[is have announced more
than 80,000 layoffs in the past year. (Protesting Bell Atlantic
workers were sent home without pay one day last November for
wearing T-shirts describing themselves as roadkill on the info
highway.{
Like yea s~id. it has ~ dn with competition, which is coming inlo our
business. ~'me already streamlined, bat we still have ~ way to go -
and so do the other BBOCs - Io mccl ~c oliimate compethion. So
· nt's wha~ yon're ~alking abouL ~a['s the downward pressnre on
the ~m~rk force.
Bat we think that aRer these downsizings are done - and when ~e
m~rkct begins to develop fully th [996 - you're going to see a lot of
hiring going on. ~e baildine of the superhighway will act as an
npwnrd pressure on the work force, ~crc'11 be a ~rea[ expansion to
onsiy arc already in Ihc cable business (herause of lhe 1995 federal
CnLirl ,'lding alhJwh]g Bell ),lia ntic to offer video dial lone).
Sq Ihal side of il iSU'I im{n,rhlnl l(J ns. But we have Io open eve~'-
Ihing up to expand the markel. This BalkanizaHon we have now is
catisin~ dis{orations in pricin~ and so on that are annecessna. ~e
market wnn't e~paud the way we waot is{ess ~m~ have fid{ and open
compelithul in all areas.
Let's talk about what precisely this network is go{he to Seek like.
You mentioned earlier that you saw yourseft as a builder, an
architect, rather than a John Ms{one-style road warrior, So
sketch it out for me. What's your grand planI What's the b{ue-
print for your nelwork7
It's ~oing to be bu It differently in cve~' town. That's the pa~ that
hasn't been captoted yet, the unspnken sto~: ~e way it's been
reported to date }~ that we a~ aS{ ~oin~ to put out hybrid fiber-coax
and co~nect it to o so-and-so with a micronet. Like Ihere's a ~rand
plan.
Ofcoursc. that'{ ridicn{ons. It's that old manufacturing mode{, like
you create one automobile design and then make 100 million cars
that all look the same. But limaCs never how ~in~s or,is sorl are
deployed. {t's ~oin~ to be quite different from some great, 8rand
plan.
Here's how it's ~oin~ Iobc bat{t: ~ere are five diffe~nt technolo-
gies that we'll use to provide video se~ices in competition wi~
cab{e companies. ~e first wi{{ be the Bber to the curb. which is ~e
approach taken by companies like BroadBand Technologies. ~is is
"We've already streamlined, but we still have a way to go-
buikl all these new ioleractive services.
$, we see a short-term need to get one cosIs down. Long terln. in
I 0 .~ears..'me're going to be a mneb bigger cmnpany.
Well, you certainly sound like you're ready and willing to take on
all competitors. So why do you think Senator Fritz He{lings, Rep-
resentative £d Markey, the Consumer Federation of America,
and even Vice President AI Gore put the blame for kS{ling the
1994 telecom bill - which would have opened communications
markets to greater competition - squarely on the regional
phone companies?
I don'l think that's fair at all I Iblnk Ihe Senate josl rail out of lime.
But wasn't that because some of the telcos - notably Bell South -
just wouldn't compromise on certain of the bill's provisions
regarding the opening of their markets to competition? Whereas
your company and other Bells were much more willing to work
out a compromise?
I Ibink that's pretty aeonrate. We cerlainly were more willing Io move
Ibe.'~nrd with Ibal bill and oegoliale some of()ar diB~rences in con-
fi'rence. Snme oflhe olhcr telephone cnmpanies felt it was Ioo dan-
ecruils Ill do.
Ultimately, does it matter whether there's a telecom law {n 19957
{ mean, you seem to be moving forward anyway to build out
your network, develop programming,
fi does nialler. We've got Io get these barriers down. We've got to get
blh, fall cOralmillion in nnr Ilnsincss slid in {nile distalice. We obvi-
winit we're going to do in Diner.
Your original ballpark estimate of the cost per home was Sl,200.
Is that still youe figure?
It's probably about $900, inchiding the drops into the home. but not
inchiding the cost of the seners sod set-lops. And once that kind of
technology gels ordered in larger volames, we'll get down ,,veil belov,'
that nnmber.
For fiber all the way?
Fiber all the way to co rbsidc, v,'ith tv,'o Ibu, s Ihen going ont to
betwee, .o0 and 50 homes. One Ihle .'viii be coax and cart",' video, the
other is twisted pair lbr voice. Clearly. that's the preferre~i architee-
litre. it's swilchrd. digital, fiilly Inleracti,,e, and yon get a tremendous
reduethul hi maiulennnce expense and all improvement in service.
So that's role Way.
Niltuber two is hybrid-fiber coax, where we run fiber to a neigh-
barhood hnb and theft coax front there to a few hnndred homes. In
some locations, tills will be the preferred snlulion, especially where
the interactivil): is uot expected to be as rnbnst, or where the demo-
graphics ofcerhdn areas demaad lower costs.
Today's price for thatl
.Maybe n rnnple huudred less Ibari for fiber h) Ihe cnrb, but we're
/'lot so sitre al)onl Ihat aoynnn'c, Be sure to let Wireds readers know
thai these estimates are based an cmlnin (~aveats and assumptions
ab{mt early rnll-oul voh,mes, rather than hdl-bh)wn nationwide
dcp{oymmlt.
I{rra
~i!;';;2: The third approach is ^DSL. ``','hen :,'art see what we're doing
~:":with it, you'll see that it's not an interim echnology - at least not in
.~;'the sense that ifs second-best or doesn't work well. It has excetleut
';' '~luality. Yon can do the virlnal VCR over it. You can fasl forward and
back, and you can have a whole batch of than hals. It's se~'er-based,
It's digilaL
But it is interim in the sense of belng a transitio.n technology,
righ,t?
Yeah, transition. That's a much better we)' to say it. It's a market end'
kind of thing. It doesn't require conditioning the whole plant It
doesn't require big switchers or anythin§ like that. It's modular. You
go in house by house, and if people want it, you just stick in a circuit
pack. ````*hen .you get enough people in the neighborhood who want
interactive ser,'ices, Ihen you bring fiber to them. Pull out the ADSL
circuit packs and bring them ant to a more remote area. They're
reusable hundreds of times, so it's an interim technology that will be
with us for 40 years.
Then what's limiting about it compared to fiber?
The cost is bigher per honse.
The cost of ADgL?
It's higher, )'es, for each house. Bnt remember wben you cm'er a
· whole batch of houses, not ever3' one of them takes cable television.
',','hen you do :~DSL, each boose costs more, but you do it tuffy al~er
the sale is made.
But isn't tile level of interactivity different?
There's a big difference between Umt and full fiber to the home. A big,
and so do the other RBOCs."
big difference. It doesn't give you infinite channels and infinite inter-
actaviD', but it does give you video-on-demand and home shopping.
And it gives you excelleut picture qualit)' and good production values
and our Stargazer user interface.
What about live broadcasts, live sports?
Well, as currently deployed, no. it's 1.5 Mbits per second. But future
versions of ADSL will caru 6 Mbits a second. That gives you live
broadcasts. It'll give you eveuthing except the gee-whiz levels of
interactivih.'.
Then the fourth approach is wireless cable. Twenty-eight GHz is
working, and it's great. And remember you're talking about antennas
that are small enongh to be pasted on a window. You paste it on and
put in your telephone jack. and you now have video. Of course, it's not
applicable to eyeD' location and every terrain.
Direct broadcast satellite is the fifth approach. ,~.nd these will all be
integrated, so if yon're Ihe customer, you can say, 'Yes, l'd like your
teleplmne service aad ynur wireless cable 'P/ser¥ice? Or you can
say, "Give me ADSL ser,'ice." or whatever. It'll depend on your loca-
tion, hmv far the eagineering and construction of the network in your
area has developed.
Do you think eventually there'll be one common architecture?
There will be. Bnt I can't predict whether it'll he fiber-to-the-curb or
fiber-to-the-linde plus coax. Bul probably those t~m will be the most
Bnl ~ ho knmvs? liemember, the capacily of wireless cable
I Initial plan 'cells for two systems: one a'hybrld flber-{oea
. syste~(HFC)lntheBeitlmore, no~thernNewJersey,' ',.' .'
-Ph Ikdelphla~PlttsbuVgh;andHemPt0n Roads (Virginia)' ' '
areas; the s'~cbnd e combined HFC'and asymmetric digital
sub'scrlbe~ II,e system In th'e Washlh~on, DC
r ~ m Includes a "will cat~~ pro~o~l to make trlnspa~
' ' able without cha~ge to local broadcast aswaIlls pubU~' ·
-educafianal, and gavem~e'nthl pr~am~ers,
: nels would be available llong withprogramming ot all
uldeo-lnfmmafion pmvldeis, CUstomets will
.t~p box to ~cei~e these iocal channelq If thty haw a cabl~ .
' ' te~dy.t elevlslon'seL ' :
:' ". Ca li fat passing Of approxlmltily 3 m l lion households ,'
· . ' and businesses In th~ y~n,. .' · .' . '-~
munl~[e~ consistlng of.36,2 perce'nt. minp~itles, ~
· .compared'~th 2~ 8 pe~entmlnefitles In Bell Atlan~c's."..
;.'..eplansd~live~oftradlfienalvld~mgtammin~en-: ·
." demand so.Ices such as mo91es, and advanced IRteta~[ve.
' so'ices such a~ home shoppi"~ educational and h~lth;. ';' .'~
: Bell'Atlanticg.'Netw0rk.
.at~i {9~ to 67~ {hinhel~ on HF{ systems t~dud- '"'
iA?clp " : ' '
ing..'. . ' ~ .'. ' · . ' ' '
gbmidc t h nht '
nal.o ' '
-231o37a is c a esl '
..-188dlghaibroadcast~hannels; · . ".~ '
· ~ .'- 7272to4~dlgitiipOIni~astchannelsthitdeliverthe,
'.' ~rogram~g subscribers choose When they wi~t i~.
~Ideo.hfm'~afi'on perkers on acommon.cirder,
. ~ch~ge a~ce~ seiv,~es over e'ach syste~, ?te~eae se~
uac~ ~tll be added to the HFC systems begmnmg th i$$7~ ".~ .
· _ i" .' ' 'w~eo ~£'~Aa¥:
City of Iowa City
MEMORANDUM
Date:
To:
March 3, 1995
City Manager
From.~arianne Milkman, Community Development Coordinator
Doug Boothroy, Director, Dept. of Housing & Inspection Services
Re:
Feasibility of Combi.ning CCN and the Housing Commission and Upcoming Appointments
to these Commissions
With the consolidation of all HUD-funded programs under one plan, a.k.a. CITY STEPS, we have
been having joint meetings of CCN and the Housing Commission to coordinate the allocation of
ODBG and HOME funds. These two Commissions will increasingly need to coordinate their
activities as we link service and job needs with housing needs of low-income residents. In the
near future we will therefore be presenting a proposal to you and the Council to suggest the
possible combination of the two Commissions into a single one. We have already discussed this
briefly with the two Commissions, and Ben Moore (Chairperson of the Housing Commission) and
Linda Murray (Chairperson of the CCN) are in agreement with this memo.
In order to have a reasonable size for the new Commission (we will probably recommend eleven
members), we suggest that, temporarily, no new appointments be made to either Commission
after March 7, 1995. This will permit time for discussion of the merits of a proposal to combine
the two Commissions.
There are currently three appointments to be made to the Housing Commission for terms ending
May 1, 1995. These appointments are to be made at your Mamh 7 meeting. There is one new
applicant (John Crabtree), and Jack McMahon has reapplied to continue his membership on the
Housing Commission. We have also asked Ben Moore (currently the Chairperson of the
Commission) if he is willing to continue serving on the Housing Commission until the consolidation
of the Commissions takes place. Ben has agreed to serve the exlre time which should be five
or six months. (Roger Reilly, the third member of the Housing Commission whose term expires
May 1, has also agreed to continue to serve if necessary.)
if you decide to appoint/reappoint Jack McMahon and John Crabtree, and ask Ben Moore tO
continue to serve for a few months, this will provide continuity and a full Commission (seven
members) for the next few months of Housing Commission activities.
For CCN, we recommend that no new members be appointed and that the advertisement for the
vacancy created by MaryAnn Dennis' resignation be withdrawn until the proposal to c~mbine the
two Commissions has been discussed. CCN has nine active members at this time. Terms of
three additional CCN members will end during 1995, so it would not take long before a possible
combined Commission would reach a manageable, eleven person membership.
The main interest of this temporary hold on appointments is to leave time to discus~ the option
of combining the Commissions.
CCN
Housing Commission
bc4-4
City of Iowa City
MEMORANDUM
TO:
FROM:
DATE:
CITY COUNCIL AND CITY ~%NAGER
FEBRUARY 23, 19~5
SUBJECT: RESPONSE TO STORY COUNTY ARTICLE ON PROPERTY TAX BURDEN
Attached are several charts related to Iowa City's property tax base for the
current fiscal year (FY95). Naomi had requested a response from Iowa City
similar to the article published on 1/10/95 by the Story County Assessor.
Iowa City's effective tax rates (gross taxes / market value) follow the same
trend as the Story County Assessor's rates. This indicates that commercial
property bears the greatest proportion of the taxburden, agricultural the least,
with residential and'industrial in the middle.
Industrial and commercial buildings and land both have the highest effective tax
rate of 3.23%. Most of our machinery and equipment is industrial, which causes
the effective tax rate for all industrial to fall to 1.98%. There is a small
amount of computers assessed as "commercial machineryand equipment" which causes
the effective tax rate for all commercial to fall to 3.19%. Residential property
has an effective tax rate of 2.19% after the rollback is applied. The hardest
value to identify is agricultural market value. The taxable value for
agricultural has nothing to do with market value, it is based on productivity
indexes governed by the state. In addition, Iowa City has very little history
of agricultural land sales to be reused as agricultural to determine market
value. Most of the City's agricultural land sales result in a different class
of property (residential, etc.). I have therefore used the Story County
Assessor's ratio of 42% to estimate agricultural market value.
Also attached are pie charts showing the relative proportions of the various
types of property within Iowa City for the current fiscal year (FY95) and the
proposed fiscal year (FY96).
City of Iowa City
'1993 Valuations
Taxes Payable in FY9$
Property
Type
Commercial
' Agricultural
Residential
Industrial
Machinery & Equipment
Market Taxable Tax Gross Effective
Value Value Rate Taxes Ta~.Rate m
540,894,733 540,894,733 32.25856 17,448,485 3.23%
4,820,867 2,024,764 22.30832 45,169 0.94%
1,089,889,230 741,564,958 32.25856 23,921,818 2.19%
37,640,010 37,640,010 32.25856 1,214,213 3.23%
111,372,025 55,181,660 32.25856 1,780,081 1.60%
Per$100,000
Property
Type
Commercial
Agricultural
Residential
Industrial
Market Taxable Tax Gross Effective
Value Value Rate Taxes Tax Rate
100,000 98,990 32.25856 3,193 3.19%
100,000 42,000 22.30832 937 0.94%
100,000 68,040 32.25856 2,195 2.19%
100,000 61,360 32.25856 1,979 1.98%
1) County Auditors Valuaaon rep~t [or Comme[c~al. Residenlial. and
2) C~ ~sessods Abs~ of ~s~en[ ~ot 199~ Ior Ma~ine~ & Equipment
Oep~al~ A~al Value u~ as ~et va~ue.
3) Eff~e Tax Ra{a: Gram T~ I ~a~et Value
4) T~bie varue is ~r John~n Coun~ And~o~s Valua~on R~
~et ~lue is es~ma[~ usi~ Sto~ C~n~ ~s per~ge 42%
T~ rate on agd~l~ml is le~ ~an on o~et ~ o~ pm~. ~mum C~ L~ of 3.00375
DMVALUAT XLS
EFFECTIVE TAX RATE
IOWA CITY
FY95 TAXES ON $100;000 MARKET VALUE PARCEL PROPERTY
$3,500
$3,000 --
$2,500 --
$2,000
$1,500
$1,000
$500
$0
Commercial
Agricultural Residential
PROPERTY TYPE
Industrial
Property Gross
Type Taxes
Commercial $3,193
Agricultural 937
Residential 2,195
Industrial 1,979
DMV^LUAT. XLS
100.000 COMPARISON
2/22/95
IOWA CITY
FY95 TAXABLE VALUATION SUMMARY
(AFTER ROLLBACKS,' ETC.)
Taxable
Property Value in Taxable Percent
Type 1,000 Value of Total
Commercial 540,895 540,894,733 37.64%
Agricultural 2,025 · 2,024,764 0.14%
Residential 741,565 741,564,958 51.61%
Industr. 37,640 37,640,010 2.62%
Util. 59,577 59,576,910 4.15%
Machinery & Equipment 55,182 55,181,660 3.84%
1,436,883 1,436,883,035 100.00%
IOWA CITY FY90 VALUATION SUMMARY
Machine.,y &
Ulil. Equipment
Industr. 4% 4%
3%
CommefcJal
38%
51% Agricultural
0%
SOURCE' JOHNSON COUNTY AUDITOR'S VALUATION REPORT FOR ADOPTION OF FY95 BUDGET
DMVAL UAT XLS
FY95 CLASS COMPOSITION
2/22/95
IOWA CITY
FY96 TAXABLE VALUATION SUMMARY
(AFTER ROLLBACKS, ETC.)
Taxable
Property Value In Taxable Percent
Type 1,000 Value of Total
Commercial 556,276 556,275,903 37.20%
Agricultural 2,095 2,095,188 0.14%
Residential 767,121 767,120,599 51.30%
Industr. 37,585 37,584,600 2.51%
Util. 68,554 68,553,709 4.58%
Machinery & Equipment 63,676 63,676,362 4.26%
1,495,306 1,495,306,361 100.00%
IOWA CITY FY96 VALUATION SUMMARY
Machinery &
Util. Equipment
(ndustr. 4% 4%
3%
Commercial
38%
Residential
51%
Agricultural
0%
SOURCE. JOHNSON COUNTY AUDITOR'S VALUATION REPORT FOR ADOPTION OF FY96 BUDGET
DMVALUAT XLS
FYS8 CLASS COMPOSITION
2/22/95
Iowa View/G
e
'
fair the ~ is. Add a group of ~liti- P/opa~ ~arkat Taxabla Tax Bro~ Effective
property-tax
system has
been tweaked
and modified to
the point that
one has to
constantly
study the
system.
clans and you will hear of scenarios on
how another new property.tax exemp-
tion will magically transform into new
jobs. The call to eliminate property tax
on industrial machinery and equip-
ment is being hailed as the great job-
creation idea of the decade.
Property taxes are, by design, very
complicated. iowa's property-tax sys-
tem has been tweaked and modified
a~nually to the point where one has to
constantly study the system to keep
abreast of the latast changes and their
effects.
At one point in 1975, Iowa's system
was nearly understandable with the
asseeed value based on market value
and representing the taxable value of
nearly all property, except agricultur-
al which was 50 percent market value
and 50 percent productivity value.
This simple system la.qted two years,
until Califorrda's Proposition 13 fever
swept the country.
Teday there are so many variables
on how property taxes are figured that
it is fairly difficult to measure the
effect (or burden) on different types of
property. This task may be difficult,
but it can be done.
The best measure of the property-
tax burden that is recognized in the
sessment and appraisal profession is
the effective tax rate. That is the
amount of taxes paid divided by the
market value of the property. This
Commercial .. $100,000_...$100,000 .... 37.20355_. $3,720 ...... 3.72%
Agricultural .__100,000 ........ 42,000 .... 37.20355 ...... 1.563 ..... 1.56
Residential ..... 100,000 ........ 68,000 .._ 37.20355 ....... 2,530 ......2.53
Industrial .... 109,000 .........65.000...~37.20355 ........ 2,418 ......2.42
wipes out all the exemptions, roll-
backs, productivity values and other
nonsense created for the specific pur-
pose of giving someone an advan-
tage. For example, if the annual prep-
erty-tax bill on my house is $1,584.00
and I believe my house is worth
$70,000, then my effective tax rate is
2.27 percent (1,584/70,000 equals
.0227). An effective tax rate of 2 te 3
percent is typical.
Look at the accompanying chart to
see what Iowa's system is doLng to var-
ious types of property.
The taxable values are based upon
the sales ratio of commercial mud agri-
cultural property in Story County, the
1993 rollback on residential property,
industrial property being valued with
two methods -- buildings and land at
100 percent and machinery and equip-
ment at 30 percent, each portion being
approximately one-third of the value.
From the chart it is easy to see who
is carrying a disproportionate share of
the property tax-burden. It is no sur-
prise that agricultural property has
the advantage since Iowa is a farm
state. However, why is commercial
property treat~l so unfairly? With the
present "rollback" system, residenti,-d
taxable values are "unequally yoked"
to agricultural taxable values, while
commercial and industrial taxable
values are not.
Properties of equal value pay vastly
differing sums in the same taxing
district. Which investor will choose
commercial as the place for his money?
The difference between agricultural
and comraereial is more than 100 per-
cent. The difference between industri-
al and residential is virtually nil, but
the difference between either industri-
al or residential and commercial is
more than 50 percent.
While politicians chase smokestacks
and megsplants with tax incentives
that everyone else pays for, Main
Street Iowa, Joe Small Business,
Ca.sey's and even Wal-Mart are stuck
with the lion's share of the property-
tax pie.
What can be done to correct this?
/- / c' - .?E-
burden?
Tile "rollback" legislation was unfair
to commercial from its inception in
1977. Ci~mk the history and .~ if the
Legislature didn't suddenly in 1979
give commercial PrnlmrtY a rollback.
The quick fix failed to correct the real
problem because of the "nnequal
yoke" that limits the growth of resi-
dential taxable values to tile amount,
of growth in agricultural taxable
values. Since agricultural taxable
values are based npon productivity
and not market value, this "yoke" has
the effect of virtually halting the
growth in residential taxable values.
Since commercial has no "yoke" to
limit its growth, the taxable value of
commercial property is disprogmrtion-
ately higher, while agricultoral and
residential have remained fiat.
The way to make this fair is to break
the "unequal yoke" between agricul-
tural values based on prodoctivity
valne and residential values based on
market value. Let residedtial values
stand on their own growth and on
market value.
Also, agricultural property should
just as all other property. This will not
cause a dramatic increase in property
taxes. The same rollback law would
keep the present 42 percent ratiu in
place for taxable values. A growth of 4
percent would be allowed annually
just like every other class of property.
The issue is fairness, and Iowa's sys-
tem is dramatically unfair.
GARY RILY~U L,: the Story C(mnt.)/ A.'cva~-
CITY OF iOWA CITY
· PA/~KS AND RECI~%TION DEPARTMENT
MEMORAND[3M
TO:
FROM:
DATE:
RE:
Steve Atkins, City Manager
Michael E. Moran, Superintendent of Recreatlo ~v~
March 2, 1995
Parks & Recreation Commission action
The Iowa City Parks and Recreation Commission at its monthly
meeting on March 1, 1995 passed the following motion:
To expand the definition of family for purposes of the
family swim pass to include people registered under the
Domestic Partnership Registry.
Staff will make arrangements to implement this policy beginning
with the distribution of our summer brochure on 5/17/95. If you or
Council wish any further comments, discussion or have questions
regarding this new procedure, please feel free to contact us.
cc: Dee Vanderhoef,
Parks & Recreation Commission Chair
City of Iowa City
MEMORANDUM
Date:
To:
From:
Re:
February 28, 1995
Mayor and City Council
City Clerk
Council Work Session, February 20, 1 995 - 6:30 p.m. in the Council Chambers
Mayor Susan Horowitz presiding. Council members present: Horowitz, Baker, Kubby,
Lehman, Pigott, Throgmorton, Novick (6:40 p.m.). Staff present: Atkins, Neumann, Karr,
Yu~;uis. Tapes: Reel 95-30, All; 95-31, All.
REFUSE COLLECTION:
Reel 95-30, Side 1
City Manager Atkins and JCCOG Solid Waste Planning Coordinator Neumann presented
information about refuse collection. Council agreed to weekly recycle pickup; curbside recycle
program, including corrugated cardboard; purchase of containers; and unit-based pricing.
Council will continue to consider eliminating drop sites, hazardous waste/toxic cleanup, new
building, and multi-family projects.
Throgmorton requested information regarding the percentage of persons and number of
garbage containers used during refuse pickup. Kubby requested information regarding the
percentage of recyclables that are collected.
LANDFILL:
Reel 95-30, Side 1
City Manager Atkins and JCCOG Solid Waste Planning Coordinator Neumann presented
information about the landfill authority; N&N transfer station; leaving the ECICOG regional
planning and establishing own plan; and long-term financing.
Council directed staff to schedule a meeting with area communities to discuss landfill policies.
WATER AND SEWER:
Reel 95-3Ot Side 2
City Manager Atkins and Finance Director Yucuis presented information about water and
sewer projects.
Council directed staff to prepare financing comparisons of borrowing versus cost of paying
as you go; cutting borrowing cost by half; tap-on fee information; and a phasing schedule of
the proposed water system projects.
2
GENERAL DISCUSSION:
Reel 95-31, Side 1
In response'to Kubby, City Manager Atkins stated staff will contact Grant Wood
Neighborhood Association regarding the public hearing on the housing project at
Whispering Meadows,
DTA representative Victoria Gilpin presented information regarding the Friday night
concert series. Council agreed to fund 85,000 out of the contingency fund for the
Friday night concert series for this year only,
Lehman noted concerns about the increasing deer population, Council directed staff
to refer the issue to Animal Cootro Advisory Board.
City Manager Atkins noted the Gazette. article written by Harvey Wehde which
commented on a City deficit. Atkins noted the City does not have a deficit.
Meeting adjourned at 9:05 p.m.
City of Iowa City
MEMORANDUM
Date:
February 28, 1995
To:
Mayor and City Council
From: City Clerk
Re:
Council Work Session, February 21,1995- 6:35 p.m. in the Council Chambers
Mayor Susan Horowitz presiding. Council members present: Horowitz, Baker, Kubby,
Lehman, Novick, Pigott, Throgmorton. Staff present: Atkins, Helling, Yucuis, Karr, O'Malley.
Tapes: Reel 95-32, Side 1.
GENERAL DISCUSSION - BUDGET:
Reel 95-32, Side 1
1. Horowitz noted Council members received their Walk of the Stars schedule.
In response to Baker, City Manager Atkins stated the CIP discussion will be scheduled
in March. Mayer Horowitz noted an economic development criteria discussion is
tentatively schedule March 20, 1995,
Kubby inquired about flood allocation monies. City Manager Atkins stated Council
directed those funds to public works projects and the purchase of undeveloped land.
Atkins noted the downpayment assistance program was a 3/3 split vote with Baker
absent but later Baker publicly indicated "no" to the program. Atkins stated staff is
preparing information and will report back to Council.
Kubby and Horowitz noted that persons from Weeg are looking at enhanced
emergency communications/early warning bulletin board project. The Mayor stated she
has asked City Engineer Fosse to follow-up on this matter.
In response to Kubby, City Manager Atkins stated he will gather information regarding
the Senior Center Communications Specialist position.
Kubby asked Council for support regarding Council's salary increase. There was not
a majority of Council to support Council's salary increase.
Novick reported that the Convention and Visitors Bureau met and will recommend that
the Iowa City City Council allocate the 25% hotel-motel appropriation minus ~ 1 O,000,
and allocate the 910,000 directly from the City.
Meeting adjourned at 7:00 p.m.
clark~cc2-21.mr
City of Iowa City
MEMORANDUM
Date: March 3, 1995
To:
Mayor and City Council
From: City Clerk
Re:
Council Work Session, February 27, 1995 - 7:00 p.m. in the Council Chambers
Mayor pro tem Novick presiding. Council present: Novick, Baker, Kubby, Pigott, Throgmorton.
Absent: Horowitz, Lehman. Staff present: Arkins, Helling, Woito, Karr, Miklo, Fosse,
Winkelhake. Tapes: Reel 95-33, All.
REVIEW ZONING MATTERS:
Reel 95-33, Side 1
Sr. Planner Miklo presented the following Planning and Zoning items for discussion:
Setting a public hearinq for March 28, 1995, on an ordinance establishing the Moffitt
Cottage Historic District for property located between Muscatine Avenue and Ralston
Creek, north of Court Street.
Public hearing on an ordinance conditionally amending the use regulations of approxi-
mately 13.09 acres located at 655 Meadow Street from RM-12, Low Density Multi-Family
Residential, and RS-5, Low Density Single-Family Residential, to RS-8, Medium Density
Single-Family Residential. (East HilI/REZ94-0020)
Miklo stated that six out of seven Council votes are needed for approval of the ordinance.
In response to Pigott, Miklo stated he will check with the Fire Department regarding fire
equipment accessibility.
Resolution approving the final plat of D&L Subdivision, a 6.41 acre, four lot commercial
subdivision located on the south side of Hiqhway 1 West, west of Sunset Street.
Resolution approving the preliminary plat of Orchard View Estates, a 107 acre, 34 lot
residential subdivision located partially in Fringe Area 4 in Johnson County south of
Dinqleben¥ Road NE, approximately 0.6 mile east of its intersection with Highway 1.
Letter to the Johnson Counb/ Board of Supervisors recommending approval of the
rezonin~l of a 0.73 acre properly from A1, Rural, to RS, Suburban Residential for property
located in Frinqe Area 4 near the southeast corner of Newport Road and Prairie du Chien
Road.
Resolution approving the preliminary and final plats of Sedlacek 2nd Addition, a 3-1or
residential subdivision located in Fringe Area 4 near the southeast corner of Newpori
Road and Prairie du Chien Road.
2
WATERFRONT/HY-VEE STORM SEWER:
Reel 95-33, Side 1
City Engineer Fosse presented information. Majority of Council members directed staff to
proceed.
Staff action: Staff will initiate an agreement with Hy-Vee and go back to Council for final
approval by March 28. (Fosse)
SIDEWALK CAFES:
Reel 95-33, Side 1
City Clerk Karr and City Attorney Woito presented information regarding sidewalk cafes.
Throgmorton requested a map of the CB-10, CB-5, and CB-2 areas detailing potential areas for
sidewalk cafes.
Council directed staff to consider:
7 a.m.-10 p.m. sidewalk cafe hours
Full-time person monitoring area
Consideration of roll-out awnings
#4. Right to withdrawal. Changelanguagetospecifythetypesofconditionsunderwhich
a license would be withdrawn, using "including but not limited to" language.
Include CN-I zone and other restaurant zones
Page 3, item "F", Maintenance be removed and items 1 and 2 be renumbered and
included as E, 5 and 6. Section "G" Operation of Sidewalk Cafes would be
relettered as "F".
Kubby requested police note indoors or outdoors on future complaints.
Karr stated she will make changes to the draft ordinance for Council's Friday packet.
Staff action: Committee to meet and answer Council concerns prior to public hearing. (Karr)
COUNCIL AGENDA/TIME:
Reel 95-33, Side 2
Baker noted that there was no Council time listed on the formal Council agenda. Kubby
noted that there was no City Manager or City Attorney time listed either. City Clerk Karr
stated those items will be added.
Kubby requested that staff make appointments with representatives for Council Members
while they are in Washington, D.C. at the National League of Cities meeting,
Kubby requested an update on the Pizza Hut sign on Iowa/Dubuque. City AttorneyWoito
stated staff will need more time.
4. Atkins noted he will be gone on Thursday due to court appearance.
3
Kubby noted that the minutes of the Broadband Telecommunications meeting suggested
a joint hearing be held with BTC and City Council, and stated her interest to pursue the
suggestion.
(Agenda Item #5.g.(4) - Letter from Dan Berry and Jerry Ambrose about sidewalks on the
100 block of Iowa Avenue.) Kubby inquired about changes in streetscape on Iowa
Avenue. City Manager Atkins stated he will prepare information.
(Agenda Item #18 - Resolution Naming Depositories.) Kubby requested additional
information. Atkins stated the resolution allows the City greater investment opportunities,
In response to Kubby, City Manager Arkins stated he will obtain information regarding the
status of the ADS property. (Longfellow Manor)
Throgmorton stated his interest in adopting a resolution opposing the death penalty.
Council Members discussed the use of City letterhead to write letters in opposition of the
death penalty. Arkins noted that as long as the letter does not express policy as a City
Council, individual Council Members can certainly express themselves as a member of
the City Council,
10.
(Agenda Item #5.g.(6) - Letter from Ed Barker regarding water/wastewater issues.) In
response to Throgmorton, Arkins stated staff is preparing a response.
11.
In response to Throgmorton, Woito stated that she is preparing a draft memorandum on
tap-on fees. Throgmorton stated a key element is to incorporate into the tap-on fee the
actual estimated cost of the water and wastewater systems that are directly a conse-
quence of the growth.
12.
(Agenda Item #15.b - Announcement of vacancies - current vacancies.) City Clerk Karr
noted that CCN vacancy should state four males and six females presently are on the
Commission.
13.
City Attorney Woito stated that revisions and additions are needed to the conflict of
interest memorandum.
14.
City Manager Arkins noted that Friday, March 17 is "Green Day" Recycle Day at the Civic
Center. He announced the City will begin recycling magazines, colored paper and
cardboard.
Meeting adjourned at 8:35 p,m.
cled~cc2-27 Jnf
Iowa City Fire Department
Serving with Pride & Professionalism
410 East Washington St.
Iowa City, Iowa 52240-1826
(319) 356-5260
February 23, 1995
Emergency Housing Project, Inc.
331 N. Gilbert Street
Iowa City, IA 52245
Attention: Ms. Pat Jordan, Director
Dear Ms. Jordan:
This letter is written at your request based on our February 17th discussion of the occupant load
at the Emergency Housing Project, (EHP),
A telephone call that I received and the article which appeared in the Iowa City Press-Citizen early
this month highlighted the EHP's shortage of space and overcrowding, As I recall, you have space
for 21 people; however, you have housed over 40 people,
My concern is for the life-safety of the occupants of the EHP. Gary Klinefelter, Senior Housing
Inspector, and I determined the occupant load of the EHP to be 31 people. The occupant load is
determined based on the available gross square-footage. With this in mind, it is imperative that
corridors and exits are free of obstructions and openable at all times,
Ms, Jordan, I look forward to working with you in the future, If you have any questions, please
do not hesitate to call.
Sincerely,
IOWA CiTY FIRE DEPARTMENT
Andrew J, Rocca
Fire Marshal
AJR/bdm
cc: Fire Chief
Gary Klinefelter, Housing & Inspection Services
Co__._~uncil on Disability Righ_ts and Education
MEETING AGENDA
IVIARCH 7, 1995 - 10:00 A.IVI.
CITY COUNCIL CHAIViBERS
CIVIC CENTER - 410 E. WASHINGTON ST.
IOWA CITY, IA 52240
4.
5.
6.
Introductions
Subcommittees/Reports
a. Housing
b. Transportation
c. Public Accommodations
d. Public Relations
Other Reports
Other Business
Next Agenda (April 4, 1995)
Adjourn
Iowa City City Council
Johnson County Board of Supervisors
mg~asst~cdm3*7.~gd
NOTE STARTING TIME
OF 10:00 A.U.
COUNCIL ON DISABILITY RIG~ITS AND EDUCATION
MINUTES
FebrUary 7, 1994
PRESENT:
Mace BravermaD, Tim Clancy, Kevin Burr, Keith Ruff, Ethel
Madison, Doris Jean Sheriff, Allyson Schulte, Ed Blake,
Marjorie Haydell Strait, Ed Brinton, Linda Carter, Nancy
Ostrangia, and Larry Quigley
Staff present: Dale Helling, Heather Shank, and Mindy
Greer.
Co-Chairperson Braverman called the meeting to order at 10:07 a.m.
Following introduction of those present, Braverman asked for
Subcommittee reports.
Clancy reported for the Housing Committee. He circulated a draft
of revised accommodation questionnaire for owners and occupants.
There was no comment on the revisions.
Strait informed the attenders that the Transportation Committee
(Strait, Clancy, Carter, Braverman, and Sheriff) agreed to look at
all aspects of transportation; however, they had nothing to report
at this time.
Madison reported that the Public Accommodation Committee met with
the owner of the Java House last week to discuss public
accommodations. She stated that the Committee is using the
Illinois Access Code as a guideline for public accommodation.
Madison explained that the Committee meets twice a month on a site
with the owner/manager in order to clarify accommodation needs.
Clancy read the list of future inspection sites; he welcomed
additional suggestions.
Helling reviewed the activity of the Public Relations Committee
stating that they want to create a brochure using a newly designed
logo to explain the mission, history, and organization of the CDRE.
Eollowing group discussion, Helling agreed that the City through
his office or HRC, the Iowa City/Coralville Chamber of Commerce,
and Independent Living should be the contact points for persons
with questions for CDRE. Blake recommended that a press release
about the organization be prepared for released when the brochure
was complete for maximum impact.
There being no further reports, Braverman asked for other business.
Following discussion prompted by Braverman asking that subcommittee
reports be included in agenda mailing, Helling asked that reports,
or information needing Committee review, be submitted to his office
by the Tuesday preceding the meeting. Following discussion,
nomination of Strait to the Core Committee, second by Shank, was
approved unanimously. AYES: All. Following discussion of
committee size and composition,
consisting of Shank, Braverman,
set of by-laws for the CDRE.
Braverman established a committee
Helling, and Brinton to develop a
Following discussion of the need for and wider utilization of uni-
sex rest room facilities, Sheriff was asked to draft a letter to
the City's Building Code officials urging an expansion of the
standard building code. The intent is to encourage the use of uni~
sex rest rooms whDn building or remodeling in restaurants or in
other public accommodations. The CDRE agreed that the core
committee would sign the letter.
Madison announced that the Center for Independent Living has been
renamed as the Evert Conner Rights & Resources Center for
Independent Living.
Following discussion on the violation of confidentiality and the
setting the next 'meeting for March 7th (agenda information due
2/28), Braverman adjourned the meeting at 10:58 a.m.
a: \minutes. cdr
RANDY LARSON
PAUL D. MILL£R
AMY L. EVENSON
335 S. Cumo.w
P.O. Box 2086
IOWA Cl'[Y, Iowa 52244
FAX 354~5949
(319)354-5500
January 26, 1995
'Larry Quigley
Ecumenical Towers
320 E. Washington
Iowa City, IA 52240
Dear Mr. Quigley,
In talking to Karen Kubby todayl she let me know that you might be interested in what progress
we're making at the Airliner in becoming more open and accessible for the general public. As
you may know, we have a five or six inch step at the threshold which is right at the lot line
where the City sidewalk and right of way meets our building, It was our impression from a
preliminary look at the logistics and City law and procedures.that our only option was to build
a ramp on the City sidewalk. Based on the difficulties other businesses were having with this
particular solution' for a variety of reasons, we enlisted the help of an independent consultant with
regard to accessibility whose name is Judy HoiL
Judy owns a consulting business that helps individuals arrive at solutions to both comply with
ADA requirements and become more accessible in general. We hired her to do an analysis of
our particular building and physical characteristics and she has made a recommendation which
we are implementing. She believes that we can install a concrete ramp in between our front door
and the second interior door through an area we call a foyer, which will remove the five inch
step and allow people to enter the front door and go up a short ramp through the foyer before
going through the second door into the public area of the restauranL She recommends that this
ramp be concrete so as to be less susceptible to damage and resultant liability concerns. The
problem of course is that throughout the winter we are unable to do any concrete or cement work
because of the temperature, We should have the work done by March's end and I'li let you
know.
Our earlier hurdle with regard to more extensive renovations such as a ramp on the sidewalk or
other potential engineering solutions was the difficulty in getting an agreement from the owner
of the building, What I'm doing with regard to this ramping in the foyer is just not telling the
landlord since I don't believe it's a major ranovation or change in the building and is one that
could be easily filled in by the owner should she ever desire to do so. By not notifying her, I
avoid the problem of having to get her consent for any major work. I think it will make it easier
for her to agree to it once she sees that it's done mad actually improves the building rather theat
damages it.
If you'd like to talk to Judy Hoit, she can be reached at 351-8375 and I think you couid
recommend her services as we found her great to deal with and very knowledgeable as well as
personally familiar with the obstacles that should be removed for equal opportunity of access for
everyone. If you have any other questions, don't hesitate to call me anytime at home, office, or
restaurant.
Ice1
!y -
R Larson
Kaaen Kubby
Evert Conner Rights and Resources
Center fo.r Independent Living
26 East Market Street, Iowa City, IA .52240 · Voice and TTY: (319) 338-3870
February 16, 1995
Mr. Dale Helling
Assistant City Manager Iowa City
410 East Washington Street
Iowa City, Iowa 52240
Dear Mr. Helling;
Please find enclosed an announcement detailing the name change of
Ind(Jpendent Living, Inc. to the Evert C~nner Rights and Resources Center
for Independent Living. Also enclosed is a brief narrative describing Eved
Conner's struggle to live an independent life.
We would like you to include this information with the CDRE Committee
package when it is mailed.
Thank you for your attention to this matter. If you have any' questions
regarding this announcement please call me at (319) 338-3870.
Sincerely yours,
Ethel Madison
Enclosures (2)
Announcement
The staff, board, and consumers at Independent Living, Inc. want to update
everyone about a major change that just occurred at this organization
(Independent Living, Inc). Many of you remember that in our December
newsletter we were contemplating a name change. We have finally made a
definite decision about a new name for this Center.
The new name we have chosen is:
Evert Conner Rights and Resources
Center for independent Living
The name change will better reflect ottr purpose and mission and will
alleviate confusion about who we are, especially sitace there are many
agencies and organizations who have independent living components
in their programs.
The name reflects who we are because:
Centers assist in keeping people with disabilities out of institutions which
saves Federal and County dollars and, most of all, creates a better quality
0 '
'f life for people with disabilities.
Centers for h~dependent Livh~g (CIL's) provide h~dividual and systems
advocacy, self advocacy training Ired a peer support network for persons
of any age with any type of disability.
Centers provide resource inforrhation and sldlls training o assist persons
with disabilities in makh~g informed choides to live independently and to
reduce or eliminate their dependence on "the system". ·
Centers are run by people with disabilities, this means that more people
with disabilities are employed (not less than 51% of board ea~d staff must
consist of people with cross disabilities).
Abrief history of Evert Conner, for whom our Center is named, is enclosed.
The Eyert Conner Story
Evert Conner v~as a man with multiple disabilities who spent 36 years
of the 57 years of his life in state institutions. Mr. Conner lost much
more than time while in the institutions; he lost much of the mobility
that he had before he entered the first institution at age 15. For nine
and a half years, the institution found it easier to keep him on a
gurney with wheels rather than transferring him to and from his wheel
chair. However, Mr. Conner did not lose his determination and vision to
live independently in the community.
In 1986, Evert Conner sought legal assistance to fulfill his dream of
independence and filed a class action suit. Although he never attained
his ultimate goal to live in and manage his own apartment, he did live
in the community in a group home for six (6) years.
Evert enriched his life through church membership, volunteer
activities, taking classes, and participating in the Hospice Road
raise funds I~o assist others in providing for their needs. Evert
motorized wheel chair to enable him to move through out Iowa
creating a quality of life denied him during his many years of
institutionalization.
Races to
used a
City,
Evert's determination, self advocacy and courage is what we strive to
instill in all consumers (people with disabilities). He was a fighter
even though he had severe disabilities. His disabilities didn't stop him
from fighting for his freedom, participating to the extent possible, in
the community. He was generous, witty and packed a lot of living into
the few years outside of the state institution. He was the epitome of
peer role modeling. Hopefully Ev~ert;s accomplishments will encourage
others with disabilities to fight harder for the right to make choices,
take risks, and determine the shape their lives will take.
The Conner Center will not dwell on Evert's institutionalization. We
will continue to remember the person who had so much courage in
spite of the institutionalization. The courage with which he lived his
life, and the struggle for independence he under took daily reflects the
philosophy of Independent Living Centers.
Evert Conner Rights and Resources Center for Independent Living,
_ Meet n,t
ADA Town Meet, ing
CONSUMERS
Date:
Location:
Tuesday, April 11, 1995
1:00 p.m. - 5:00 p.m.
Central Iowa Center for Independent Living
1024 ~/alnut '
Des },loines. Iowa
For more information call: John TenPas (515) 281-5969
The National Council on Oisability is an independent federal agency making
recommendations to tile President and Congress on issues affecting 49 million
^roericans ~ith disabilities and their families.
3.hm.n C~n~7
Charles D. Duffy, Ch~r~erson
Stephen P. Lacina
Joe Bolkcom
Don Sehr
Sally Stutsman
February 27, 1995
BOARD OF SUPERVISORS
TO:
Heidi Laudtzen, Coralville Public Library
Susan Craig, Iowa City Public Library
Ada Crow, Oxford Public Library
Dee Crowner, North Liberty Community Library
Chris Brown, Solon Public Library
RE: FY97 Library Funding from Johnson County
As you all know the Johnson County Board.of Supervisors has been faced with a property tax
freeze for the last several years as .are city governments.
This limitation on us has greatly impacted our ability to increase needed revenue in the Rural
Basic Levy. It is this Rural Basic Levy that provides our capability to fund library services for
the rural residents in Johnson County. This limitation was especially evident this year when
funding for the libraries v3as discussed.
The board therefore has established a committee to study library funding for Johnson County.
The committee will consist of the following: two board members, Charles Duffy and Sally
Stutsman
County Attorney, J. Patrick White
Deputy Adm. Asst., Kim Benge
Library Directors
This letter is to let you know of this action and that I hope you will be an active participant.
The main goal of this committee is to develop a formula where by each library will be funded
equitably.
913 SOUTH DUBUQUE ST. P,O. BOX 1350 IOWA CITY, IOWA $2244-1:350
TEL: (319) 356-6000
FAX:
It is my intention to meet onc~ a month with the hope an agramerit can be e~ecuted with in
less than six months. I have enclosed a calendar. Please mark'which day of the month and
time would be best for you to meet. Please also note a second choice. A stamped self-
addressed envelope has been enclosed for your convenience. I hmw we all have very busy
schedules and it may be difficult to find a time when w~ can all meet but we will do our best.
See you at the meeting.
Sincerely,
Charlie Duffy '-u ~,
Chair, Board of Supervisors
e: Mayors
file
CD/cp
To: IO~ CITY CLERK
From Board o~ Supervisors
Z-14-95 12:39p~ p. ~ of 3
Johm(m Coun~'
BOARD OF SUPERVISORS
Charles D. Duffy, Chairperson
Joe Bolkcom
Stephen P. Laeina
Don Sehr
Sally Slutsman
March 2, 1995
FORMAL MEETING
1. Callto order 9:00 a.m.
Agenda
2. Action re: claims
'Action re: informal minutes of February 21st recessed to Februa~ 23rd
and the formal minutes of February 23rd.
4. Action re: payroll authorizations
5. Business from the County Auditor.
a) Action re: peImits
b) Action re: reports
c) Other
6. Business from the County Attorney.
a) Report re: other items.
FAX' (t 191
To: IOgq CIIY CLERK From; Board of'Supervisors 2-14~95 12:39pa p. 3 of 3
Agenda 3-2-95
Page 2
7. Business from the Board of Supervisors.
a) Action re: setting public hearing for road vacation 1-95 for March 14,
1995 at 10:00 a.m. (a portion of Vincent Avenue between Elmira Road
and Wapsi extension.
b) Action re: resolution authorizing County Engineer to place 8 ton
embargoes on various roads as weather conditions require.
c) Discussion/action re: Proclamation for National Infant Immunization
Week for April 23-29, 1995.
d) Motion re: Compensation Board recommendation.
e) Discussion/action re: resolution adopting FY 96 budget.
f) Motion to hold both informal and 'formal meetings for the week of
Mamh 12th on March 14th.
g) Other
8. Adjourn to informal meeting.
a) Inquiries and reports from the public.
b) Reports and inquires from the members of the Board of Supervisors.
c) Report from the County Attorney.
d) Other
9. Adjournment.
City of Iowa City
MEMORANDUM
DATE: March 3, 1995
TO: Steve Atkins, City Manager
FROM: Rick Fosse, City Engineer
RE: Burlington/Gilbert Accident Statistics
A recent review of the accident statistics for the Burlington/Gilbert intersection revealed
that a statistical error has been made by entering the wrong period of record. The
correct statistics are one accident per 24 days and one injury per 53 days. However,
the intersection still has the I?ighest rate of accidents and injuries of any location in
Iowa City.
Please share this information with the Council. My apologies for the error.
cc: Chuck Schmadeke
To: IO~ CH¥ CLERK From: Board oF Supervisors Z-]9-95 I:Olpra p. Z of Z
Jobturin CDunh.-
Charles D. Duffy, Chairperson
Joe Bolkcom
Stephen P. La¢ina
Don Sehr
Sally Stutsman
BOARD OF SUPERVISORS
March 7, 1995
FORMAL MEETING
1. Call to order 9:00 a.m.
Agenda
2. Canvass of votes for North Liberty special election.
3. Adjournment.
INFORMAL MEETING TO FOLLOW
h :~agcnd ~can ve, asl.doc
913 SOUTH DUBUQUE ST.
P.O. BOX 1350
IOWA CITY, IOWA 52244-1350
'tEL: (319) 356-6000
FAX: (319) 356-6086
To: lOW CITY CLERK From: Board or Supervisors 2-19-95 l:ZOpm p. 2 o? 2
Johnson Count.",'
Charles D. Duffy, Chairperson
Joe Bolkcom
Stephen P. Lacina
Don Sehr
Sally Slutsman
BOARD OF SUPERVISORS
March 7, 1995
INFORMAL MEETING
Agenda
1. Call to order following the canvass meeting.
2. Review of the informal minutes of Febtomy 28th recessed to March 2nd
and the fbrmal minutes of Ma]'ch 2nd.
Public Meeting for review and comments regarding Region X ISTEA
Transportation Improvement Program for FY 96- FY 98/discussion.
Business from Graham Damcron, Director of Public Health re: proposed
zoning fees/discussion.
5. Business from the Board of Supervisors.
a) Reports
b) Other
6. Business from the County Attorney.
a) Discussion re: assignment of scavenger lax certificate 8-289 (south
Y4" of Lot 11 Block 3, Murphy's Addition, North Liberty) to Antone
and Agnes Wagner for $107.53 delinquent laxes.
b) Executive Session to discuss factfinder's report regarding Johnson
County administrative unit collective bargaining.
c) Ofl~er
Discussion from the public.
Recess,
913 SOUTH DUBUQUE $'1'.
P.O. BOX 1350
IOWA CITY, IOWA 52244-1350
TEL: (319) 356-6000
FAX: (319) 3564086
City of Iowa City
MEMORANDUM
Date: March 6, 1995
To: Councilor Karen Kubby (~
From: Karin Franklin, Director, P
Re: Sensitive Areas Ordinance
Steve indicated that you had a question regarding the application of the proposed Sensitive Areas
Ordinance on development within one mile of our corporate limits. The Sensitive Areas
Committee is pursuing an ordinance which would consist of a zoning overlay very similar to our
planned development housing (PDH) overlay. Since this is a zoning provision and the County
has ultimate authority over zoning outside of our corporate limits, the Sensitive Areas Ordinance
would not apply outside the city.
The Committee feels the zoning approach is the best way to deal with the sensitive areas issue.
The only way we could gain applicability of this type of regulation to the extra-territorial jurisdiction
would be if we included something in our subdivision regulations. At this point, only subdivisions
.that fall within the parameters of the sensitive areas zoning would be subject to the draft Sensitive
Areas Ordinance.
If you have any questions, please feel free to call me or Bob Miklo, who is working with the
Sensitive Areas Committee.
cc: City Council
City Manager
bc$ -2KF
City of Iowa City
MEMORANDUM
Date:
To:
From:
Re:
March 6, 1995
Steve Atkins, City Managerr~~
Recently I have received a number of inquiries and I know the Council is interested in what
is happening with the Longfellow Manor property. I spoke with Roger Reilly of Hills Bank on
Friday, March 3. At that time Jim O'Brien continued to be the owner of the property. Two
or three developers, that I am aware of, have an interest in that property. Roger indicated
that interested parties were working with Mr. O'Brien and with the bank on conveyance of
the property. Mr. O'Brien is interested in selling it.
It is unlikely that Mr. O'Brien will retain ownership of the property for any length of time. Any
new developer will have the option of purchasing the work that has been done on the final
plat of Longfellow Manor and proceeding with that plat. If you will recall, the preliminary plat
was approved by the City Council; however, the final plat was deferred indefinitely due to a
lack of closure on some of the legal papers. The preliminary plat is still in effect and anyone
who purchased the rights to that plat could proceed by bringing the final plat back to the
Council for approval. This would simply mean making some name changes on the plat and
placing a resolution on the Council's agenda. Such an approval would retain dedication of
2.O8 acres to the City for open space along Ralston Creek. A buyer could decide to abandon
the plat for Longfellow Manor and restart the process. This would mean preliminary and final
plat approval of any subdivision and/or approval of a planned development. Regardless,
anyone who buys the property and wishes to develop it for anything other than a single
duplex will require some City approval which will entail a public process and potential input
from the Longfellow Neighborhood Association. At a staff level, we will make every effort
to ensure that the open space along Ralston Creek is retained as dedicated public open space.
Mr. Reilly could not say with any assurance when this would all be resolved; however, one
would think that the bank would need to come to some closure on it relatively soon. Please
let me know if you would like me to follow up on this any further.
b~rongfe[w