by CHRIS ROGERS
Winonans who want cable television have two options: Hiawatha Broadband Communications (HBC) or Charter Communications. The two companies hold franchise agreements with the city of Winona allowing them to route cable lines under city right-of-way and into homes. However, for the last few years, Charter has been operating under a series of temporary renewals while it and the city try to work out a new long-term franchise agreement. City officials claim those talks are going nowhere, and last month, the city took a step to negotiate more aggressively: conducting a $15,000-$20,000 study that could be the first step toward a formal termination of Charter’s franchise.
Attorney Brian Grogan is representing Winona in its franchise negotiations, and he laid out the backstory for the City Council last month. Charter secured its first franchise in Winona, a 15-year deal, in 2000. Since that expired, the city has given Charter short-term extensions, and the company continues to operate under the old deal, Grogan explained. HBC’s last franchise agreement expired around the same time, and in 2016, the city finalized a new deal with HBC with terms that are pretty good for the city. It included a five-percent fee HBC would pay to the city every quarter, with a strong definition of what revenues counted toward the fee, a requirement that HBC provide four public-access channels for local governments and schools, and that HBC adhere to strong customer services standards, according Grogan.
Ideally, the city would like to have a strong competitor to HBC to give Winonans a choice in cable providers, and it would like to keep the terms to which HBC agreed. If the city strikes a very different deal with Charter, it will need to revise HBC’s franchise agreement, too, Grogan explained.
Grogan said that the city has been trying to get Charter to agree to the same terms, or at least similar ones, but that the company made an offer with very different terms two years ago and negotiations have more or less stalled since then. “Despite our meetings, we wait months and months to have documents exchanged, and in the end, we don’t seem to move forward at all,” he stated.
Charter Communications repudiated Grogan’s characterization of the negotiations. “We are actively working with the city to negotiate a franchise renewal, and we continue investing in our network and high-value services in Winona,” a Charter official said in a statement.
In any case, Grogan proposed that the city get serious. He is convinced that informal negotiations alone will not be effective, and he suggested that the city enter into a formal legal process to either accept or deny a proposal from Charter. The first step is to conduct a community needs assessment, a study that outlines what Winona needs and wants from cable providers. Then, the city would set a deadline for Charter to make a proposal based on that assessment, and the city would have four months to decide whether to accept the proposal or reject it, essentially ending Charter’s cable franchise. If the city rejects the proposal, Charter could sue to challenge the city’s decision, but few such court cases have been successful, Grogan told the council. Council members gave city staff the nod to pursue a needs assessment. The act of commissioning a needs assessment may be enough to change Charter leaders’ minds, or the city may need to go through the entire process, he stated. However, there are strong incentives for both sides to settle, Grogan said.
Grogan mentioned that Charter actually asked the city to start this formal process a while ago. That put the onus on the city to either start formal negotiations or approve Charter’s informal offer, he said. “The longer it delays, there is an argument to be made that it’s the city’s responsibility to get this done,” Grogan told the council.
“Charter remains committed to meeting the needs of our Winona customers, and we’re doing that through advanced product offerings and investments in improved customer service,” Charter Communications officials wrote in a statement. “We have an extension in place as we work toward renewal and our continued partnership with the community.”
City staff are in the process of hiring a company to conduct the needs assessment.