Vienna Goes a Round with Verizon

Vienna Goes a Round with Verizon

Town Council decides to hold out for cable television franchise similar in terms to its agreement with Cox.

The Town Council made clear Monday night its desire that negotiations with Verizon over a cable franchise in Vienna would use the town's terms as a starting point. This came in spite of a bill passed this year by the General Assembly and, effective July 1, stating that if a cable provider cannot reach a franchise agreement with a locality within 45 days, the company can fall back on a statewide franchise template in order to begin services to the area. The statewide agreement would impose fewer responsibilities and restrictions on the cable provider than most existing franchise agreements in the Northern Virginia.

Verizon has an existing telephone franchise in town but would need a separate one to operate cable facilities. In light of Verizon's request to install video cables in town although the company had not proposed a franchise agreement, the town proposed a 15-year franchise to Verizon. The council has repeatedly expressed a desire to introduce competition into Vienna's cable market — now monopolized by Cox — but has disagreed with Verizon over the terms of a cable franchise, particularly the company's desire to be exempt from the town's undergrounding ordinance, adopted in the early '90s, requiring all new cables along Maple Avenue to be laid underground.

Town attorney Steve Briglia noted that the language of the town's proposal was "almost verbatim" to Verizon's existing cable franchise with Fairfax County. However, the company returned a rewritten version of the agreement, which Briglia later said was drastically altered and absolved Verizon of many of the responsibilities which it bears to Fairfax County, such as provisions for consumer protection, complaints and judicial dispute resolution.

Councilmember Edythe Kelleher later noted that Verizon had also inserted provisions allowing the company to walk away from the project if less than 25 percent of the town had subscribed within three years and to be held not responsible if it failed to hire sufficient personnel, as well as a provision that would prevent the town from rescinding the agreement.

"I was able to speak with representatives of Verizon this morning, and they have indicated to me that they do not support [the town's proposed] franchise and that they will not offer the town of Vienna a franchise that is significantly similar to the County of Fairfax's," Briglia told the council. "I was informed that that's not possible."

John Knapp, Verizon's director of government affairs for Virginia, told the council Verizon would not enter into a cable franchise agreement until it had installed the facilities to support the operation. He said Verizon wants to be treated the same way Cox was treated when it brought cable into Vienna without burying the lines.

"We do not dispute that the town has the right to manage its rights-of-way," he said. "We do believe that state law requires that you do it in a nondiscriminatory fashion."

Knapp said Verizon's proposal was to install their fiber optic cables aerially where its existing telephone lines are aerial and underground where its phone lines are underground, as Cox had done.

THE COMPANY'S CONCESSION to the town for allowing this, he said, was that it would cover the cost of undergrounding the lines on Maple Avenue whenever the town buried the rest of the cables along the commercial corridor in accordance with the Maple Avenue relocation project. Verizon would also agree to make fiber optic cable access available to 96 percent of the town within a single year. Four percent of the town would be served by a Verizon center not yet wired for fiber optics.

Councilmembers noted that when Cox, then called Media General, installed cable in 1983, there was no undergrounding ordinance in town, and Cox had obtained a franchise agreement before setting up facilities.

As for other provisions of Verizon's proposal, Town Manager John Schoeberlein asked Knapp why Vienna could not be granted an agreement similar to the franchise with Fairfax County.

Knapp noted that the county's franchise was negotiated a year ago and signed nine months ago, prior to the General Assembly session. "since then, the law has changed," he said. "We have a new law. We have a new process for negotiating franchises. We have a new backstop in this thing called ordinance franchise." He went on to say that no jurisdiction had been granted such an agreement since the law was passed and that the county might not have been granted that franchise if it had been negotiated after the passing of the bill.

He emphasized that the proposal offered by Verizon was only a starting point for negotiations, and he repeatedly urged the town to sit down and negotiate terms with the company.

"Am I willing to say I'll start from that franchise?" he asked. "The answer is, that's not where we're going to start from. We may get close to it. We may get all the way. But that's what negotiations are about."

HE ENCOURAGED councilmembers not to jump to the conclusion that the agreement they would ultimately receive would be less favorable that the county's franchise, but council members said they were, indeed, jumping to that conclusion.

Councilmember Maud Robinson asked what sort of agreements the company had entered into with Fairfax and Falls Church cities and was told that they were agreements similar to what Verizon was proposing for Vienna.

Councilmember Sydney Verinder asked whether Verizon was negotiating with the city of Alexandria and was told that no negotiations were underway because of the city's strict undergrounding rules.

In response to Knapp's entreaty for equal treatment, Councilmember Laurie Cole stated, "Anybody who wants to provide video services, as a new competitor, must follow the ordinance that we already have on the books and that we would hold anybody else to. If Joe and Loretta's Cable Services came to Vienna to provide video services, we would require them to put their facilities underground, and I just don't understand why it is that Verizon thinks that they should not be treated like any other video competitor."

Kelleher pointed out that negotiating based on an offer for undergrounding services to be rendered when the town finished relocating cables on Maple Avenue, which might not happen until 2009 or '10, was difficult because there was no way to predict what the cost of the project would be by then.

"Town residents are also county residents. There's no discount on taxes for living in the town," she added. "So how do we explain to our residents that, 'Gee whiz, you would have been better off had you allowed the Board of Supervisors to negotiate your franchise for you, rather than your Town Council'?"

Knapp again asserted that Verizon's offer was only a starting point for negotiations. However, following a few citizen comments, ranging from outrage at Verizon to encouragement of cable competition, the council unanimously voted to approve its own version of the franchise proposal.

First, however, they took turns making final remarks.

Schoeberlein asked how the town would know, when it was handed the bill for the Maple Avenue relocation project years from now, that the cost of burying Verizon's cables was actually not included in it. "It's impossible," he said. "I just don't think that should be part of the discussion."

"I really don't see why we should be engaging in this game of chicken and delay," said Cole. "I think that we have something here that is reasonable for the town."

Briglia again pointed out that he had been informed by Verizon officials that the company was not interested in entering into a franchise that "in any way, shape or form looks like Fairfax County's. So I don't understand what negotiation is going to occur."

"It was part of the town's legislative package that we requested our state delegation to vote against this measure," Councilmember Mike Polychrones said of the bill to which Knapp referred as Verizon's new leverage. "And they both did."

Following the council's vote, Kelleher noted that the approved agreement remained an offer to Verizon, and she invited the company to use it as a starting point for negotiations.

IN OTHER MATTERS, the council voted to approve an increase of 11 cents per 1,000 gallons to the town's water tax and an increase of nine cents per 1,000 gallons to the sewer tax, with Kelleher and Verinder each voting a "symbolic nay."

A proposed ordinance authorizing the issuance of a general obligation debt not to exceed $8,000,000 was adopted, as was the town's budget for fiscal year 2006-07 and a resolution awarding the financing of a general obligation debt of $4,950,000 to Commerce Bank. The town also accepted a letter of dissolution received from the Northern Virginia Regional partnership. The partnership is dissolving as a result of the elimination of state funding.