Charter Communications Inc. has mollified one Louisiana
town where it has bought a cable system, but a second is demanding information to
determine if the company improperly bought a system without appropriate local regulatory
The confusion was caused when Charter, on a buying binge,
acquired Renaissance Media Partners, then the nation's 46th largest MSO
with about 125,000 customers. Apparently that deal, struck in March, was structured to
designate Charter as the holding company with Renaissance surviving as a business unit. As
a result, the MSO did not approach the communities for transfer approval.
But that's not how communities such as St. Tammany and
Slidell are used to doing business. Last year, when Renaissance acquired the Slidell
systems from Time Warner Communications, it sought transfer approval from the community.
St. Tammany convened a police jury to conduct fact-finding
on behalf of the parish, to determine if the operator had violated local law by absorbing
Renaissance without seeking approval. Whether by stock transfer or sale, ultimate
ownership of the operation had changed, the police jury argued. Then, St. Tammany
regulators passed an ordinance that threatened to revoke the local franchise.
At the end of December, the parties reached an agreement.
To avoid further litigation, Charter agreed to open franchise renegotiations next
November, three years ahead of schedule. That will allow officials to raise issues of
local concern, such as the unification of operations in the city and unincorporated St.
Tammany; increased support for local public-access channels and the delivery of high-speed
Internet access to local schools.
Charter would benefit from mending fences with St. Tammany:
it faces a competitive threat in 2000 from a video build-out by BellSouth Corp.
But Slidell is still on the outs with the operator. As the
year ended, city attorney Tim Mathison was drafting a letter to the operator to determine
whether his city was improperly bypassed in the system acquistion process, he said.
"At this point, we don't know what kind of deal
was struck here," he said, noting that the Slidell franchise requires city approval
but only for certain kinds of deals. The issue hasn't been resolved because "we
haven't asked" about it until now, he said. Charter's local officials have
expressed a willingness to resolve the issue, he added.
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