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Chicago Is Fine City for RCN

RCN Corp. has been hit with more than $1 million in daily fines -- punitive action by the Chicago Cable Commission because the operator has not met build-out milestones nor made access-corporation payments.

The commission has the authority to assess the fines itself, so the penalty began accruing as soon as it was approved at a special meeting held by the commission Feb. 21, according to city spokeswoman Constance Buscemi.

An RCN spokesman did not return a call for comment Monday. RCN is trying to restructure its debt, and it petitioned Chicago late last year to revise two of its franchise agreements.

Chicago authorities claimed that RCN is $215,000 in arrears to CAN-TV, the city's public-access corporation.

The operator has fully built out Area 1, the so-called Gold Coast area along Chicago's lakefront. That area was under construction by a previous owner, 21st Century Telecom Group Inc., before that company was acquired by RCN.

But RCN has built only a fraction of the 676 miles of plant it is required to construct in a second franchise, and no plant in two other areas has been built. RCN has petitioned to have the franchises in the latter two areas nullified.

On Feb. 10, the city commission warned that it would take action against RCN and gave the operator until Feb. 20 to at least resolve its funding issues with CAN-TV.

The commission took the vote to show companies that do business in Chicago that the municipality expects them to honor their business commitments, according to a statement from the commission issued after the vote.