City Commissioners unanimously on May 3 to approve a cable system franchise agreement with TDS Metrocom LLC.

The Madison, Wisc. based company has requested a non-exclusive franchise agreement for providing cable television services.

Staff is recommending approval of the agreement, under which TDS will provide broadband internet, video and digital voice services in the city.

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The company has recently constructed new networks in Idaho and Washington and entered franchise agreements with the cities of Billings and Helena for the construction of new networks to provide cable television services there, according to the city staff report.

There was no opposition to the agreement during the May 3 commission meeting.

The Federal Communications Act requires cable operators to get a franchise from a local government granting it permission to use the public-right-of-way to provide cable services.

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The local government can impose conditions on a cable system provider, it can’t unreasonable refuse to approve additional competitive franchises, according to the city staff report.

The federal law allows local governments to received a franchise fee of up to five percent of gross revenues from the cable services provided in the local government’s jurisdiction, and under past agreements, cable providers have paid $600,000 to the city annually into the general fund.

That amount per company could come down if there’s competition and gross revenues are shared across companies, city staff said during the meeting.

The City of Great Falls used a consultant to help negotiate the proposed franchise agreement with TDS, which is the first new wireline cable operating in the local market since Spectrum’s predecessors started in the 1970s, according to the city staff report.

The agreement is modeled after the one that is currently in place with the city’s only other cable system franchise holder, Spectrum Pacific West. Commissioners approved that agreement in 2020.

TDS will also provide broadband internet service, which isn’t subject to local government regulation or franchise fees, according to the staff report.

Paul Skubinna, city public works director, said his office is tracking TDS’ progress in other communities and expects it will take the company about two years to install cable lines.

The city has fees for other utilities or fiber in the public right of way that are handled through the development process.

The TDS agreement as proposed, according to the staff report, includes:

• an initial term of 10 years, which is the same as Spectrum;
• service area minimum density generally of at least seven residences per quarter-linear strand mile
  of aerial cable;
• subject to a marginal cost offset, provision of free basic cable service to four city facilities: the Civic Center, Great Falls Police Department, Great Falls Public Library and the new indoor recreation center;
• franchise fee of five percent of gross revenue, which is the same as Spectrum;
• provision of educational and government access channel; and
• access channel capital support for equipment to be used for operation of the access channel by the city.

Deputy City Manager Chuck Anderson said that there will be a separate government access channel through TDS and the agreement requires the company to pay some of those startup costs as Spectrum did for the access channel on their services.

The city was required to notify Spectrum of TDS’ request under the current agreement with Spectrum.