HomeMy WebLinkAboutContract 33596 CITY SECRETARY
CONTRACT NO.
SETTLEMENT AGREEMENT
This Settlement Agreement("Agreement") is made and entered into as of the date set
forth below by and between Marcus Cable Associates, L.L.C. d/b/a Charter Communications
("Charter") and the Cities of Fort Worth, Burleson, Benbrook, Duncanville, Hurst, Keller, North
Richland Hills and Southlake ("the Consortium Cities") relating to the Consortium Cities' audit
of Charter's compliance with customer service standards regarding telephone answering time as
described in the Consortium Cities' letters to Charter dated on or around April 9, 2003 ("Audit")
pursuant to the federal Cable Act, as amended, 47 U.S.C. § 552.
By this Agreement Charter and the Consortium Cities hereby settle their dispute
regarding the Audit concerning the methodology used to determine"abnormal operating
conditions" during which time Charter is allowed to adjust the number of calls answered under
the telephone answering requirement.
WHEREAS, on and around April 9, 2003, through a series of letters from individual cities,the
Consortium Cities notified Charter of its alleged failure to comply with customer service
requirements regarding telephone answering time; and
WHEREAS, the Consortium Cities and Charter disagree with the methodology used to
determine"abnormal operating conditions" during which time Charter is allowed to adjust the
number of calls answered under the telephone answering requirement; and,
WHEREAS, the Consortium Cities and Charter have spent considerable time reviewing and
evaluating the data related to the telephone answering requirements, and the parties desire to
conclude this review process and to settle and finally resolve their dispute regarding the Audit of
the methodology used to determine "abnormal operating conditions"during which time Charter
is allowed to adjust the number of calls answered under the telephone answering requirement;
and
WHEREAS,the Consortium Cities and Charter desire to add benefit to the citizens of the
Consortium Cities who are Charter's customers;
NOW THEREFORE, in order to settle and finally resolve their dispute regarding the audit and
their dispute arising out of the methodology used to determine "abnormal operating conditions"
and the alleged violation of customer service standards set forth in Charter's Franchise
Agreement, for the mutual promises and covenants set forth in this Agreement, the adequacy and
sufficiency of which consideration is acknowledged, consideration of the mutual covenants,
conditions and obligations set forth herein,the parties agree as follows:
AGREEMENT
1. Charter Community Grant. Within 10 days of the final signatures being placed on this
Agreement, Charter will pay the Consortium Cities the amount of $250,000, in the form of a
Charter Community Grant, which shall be used exclusively for a community program as
determined by the appropriate city council. For the years 2007, 2008 and 2009 Charter agrees to
pay to the Consortium Cities annual Charter Community Grants of$250,000 to be used by the
Consortium Cities exclusively for a community program as determined by city council, which
amount shall be due and payable on each yearly anniversary of the first $250,000 payment.
Charter shall make annual payments to each Consortium city in the amount of:
Benbrook $ 9,353.13
Burleson $ 6,378.13
Duncanville $ 11,653.13
Fort Worth $168,678.13
Hurst $ 13,253.13
Keller $ 11,353.13
North Richland Hills $ 19,428.13
Southlake $ 9,903.13
Any Charter Community Grant payments made to the Consortium Cities by Charter shall not be
deducted from any franchise fee payments made to the Consortium Cities as required by the
current franchise agreement of the Consortium Cities,nor shall they be passed on to customers.
Charter will be acknowledged as the donor of these charitable funds and will also be invited to
participate in community programs with additional in-kind services as the opportunity may arise.
For purposes of illustration and not limitation, such additional in-kind contributions may include
appropriate participation from Charter's programming partners in community initiatives such as
alcohol awareness or gang prevention.
2. Abnormal Operating Conditions. Charter and the Consortium Cities acknowledge the
difficulty in implementing the franchise agreement standard in allowing adjustments for
"operation conditions that are not in the control of the company". In order to clarify that
standard and avoid uncertainties in the future, the parties agree to the following methodology and
criteria for the remainder of their franchise term with the Consortium Cities:
a. Charter will declare an outage when three calls from the same node tell them that
a service interruption has occurred. Charter will also declare outages if its Nagios Systems
shows a problem with five modems in the same node. Charter will continue timely
implementation of technological improvements to its system to allow it to find problems sooner
and repair them as quickly as possible.
b. When an outage is declared, a technician will promptly be dispatched to diagnose
and fix the problem. The technician will make a determination as to the cause of the outage and
report that determination to the dispatcher who in turn will immediately enter the information
into Charters' outage reporting database.
C. The categories that will constitute "operation conditions that are not within the
control of the company" (Abnormal Operation Conditions)will be limited to the following:
1. Line Extender Fuse(AC) (caused by third party power surge)
2. Line Ext. DC Power Pack Fuse (caused by third party power surge)
3. Main Amplifier Fuse(AC) (caused by third party power surge)
4. Main Amp DC Power Pack Fuse (caused by third party power surge)
5. Splitter/DC Coupler Fuse(caused by third party power surge)
6. Power Inserter Fuse(caused by third party power surge)
7. Power Supply Fuse(caused by third party power surge)
8. Power Supply Commercial Breaker(caused by third party power surge)
9. Commercial Power Outage (TXU or other power company)
10. Underground Cut Feeder(caused by third party)
11. Underground Cut Trunk (caused by third party)
12. Aerial Oversize Load Hit(caused by third party)
13. Vandalism(caused by third party)
14. Aerial Cut Feeder(caused by third party)
15. Aerial Cut Trunk(caused by third party)
16. Cut Fiber(caused by third party)
17. Pedestal damage(caused by third party)
18. MDU Lock Box damage (caused by third party)
In addition to these types of outages, Charter will categorize the following as Abnormal
Operating Conditions pursuant to the franchise agreements:
19. Severe weather conditions,
20. Civil disturbances
21. Natural disasters
d. The technicians and the dispatchers will be instructed that outages must be
correctly and consistently categorized. The data entry will also recite the node number from the
affected area of the outage along with the outage category.
e. For each outage that constitutes an Abnormal Operating Condition period, Charter
will adjust the calls received during the service interruption(in one-half hour intervals)in the
following manner: all calls not answered within 30 seconds during Abnormal Operating
Conditions will be subtracted from the total number of calls received. Stated another way, the
number of calls answered in 30 seconds plus the number of calls handled by automation will be
divided by the total number of calls received less the sum of the calls abandoned in under 10
seconds plus the number of calls not answered within 30 seconds during any Abnormal
Operating Condition period.
f. The City will continue to receive a monthly report showing all of the "Abnormal
Operating Conditions"outages set out by day. That report will show the total number of calls
received, the number answered within 30 seconds, the number of calls adjusted and the adjusted
answer rate for that month.
g. The outage reporting database will be capable of producing reports that will be
available upon request for review to support the monthly reports Charter will give to the
TEX.
Consortium Cities. The Consortium Cities may spot check to confirm Charter's data and
computation, including review of daily call center combined total sheets and outage
compilations.
3. Partial Reimbursement of Costs. Charter agrees to pay the Consortium Cities within 10
days of the date of the final execution of this Agreement the sum of$7,500 as reimbursement for
certain audit costs. Any payment for partial reimbursement of costs made to the Consortium
Cities by Charter shall not be deducted from any franchise fee payments made to the Consortium
Cities nor will it be passed on to Charter customers.
4. Settlement. Payment by Charter under this Agreement is intended for settlement
purposes only and does not constitute any admission by Charter or agreement with the
allegations that Charter failed to comply with customer service standards regarding telephone
answering time. This settlement is intended to resolve and conclude their disputes regarding the
Audit and the methodology used to determine "abnormal operating conditions" during which
time Charter is exempt from meeting the telephone answering requirement.
5. Release. (a) Subject to Charter making all of the payments required by the terms of this
agreement, each Consortium City releases, acquits and forever discharges Charter from any
financial liability it may have arising out of alleged breaches of the various franchise agreements
for all quarters through June 30,2005.
(b)This agreement does not restrict possible future action by Consortium
Cities regarding separate customer service standard compliance. This release also does not
absolve Charter from liability for unpaid franchise fees, if any. Further, this release does not
preclude any of the Consortium Cities from alleging past breaches in the context of franchise
renewal discussions; the release only goes to the Consortium Cities' right to seek damages for
such breaches, if any.
6. Applicable Law. This agreement should be construed and interpreted in accordance with
the laws of the State of Texas. Venue shall be in Tarrant County, Texas.
7. Counterparts. This Agreement may be executed in counterparts each of which shall be
deemed an original and all of which together shall be deemed an original and all of which
together shall be deemed one and the same document.
8. Confidentiality. To the extent allowed by law, the Consortium Cities and Charter agree
to maintain confidentiality and not to disclose the contents of this Settlement except as may be
required by law, including but not limited to the Public Information Act,Texas Government
Code § 552, et seq., and the Consortium Cities' disclosure of this settlement and pertinent
information to the Texas Attorney General or as ordered by a Court as part of a response to a
Public Information Act request or by mutual consent of the Parties. Disclosure to the Texas
Attorney General or as ordered by a Court as part of a Public Information Act request shall not
be deemed a violation or breach of this agreement.
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9. Entire Agreement. This Agreement is the entire Settlement Agreement that exists
between the Consortium Cities and Charter with respect to the issues discussed above.
10. For convenience purposes, each party will sign this Agreement on separate signature
pages and authorize the attachment of such signature pages to a copy of this Agreement to
constitute fully executed copy of this Agreement. In witness hereof the parties have executed
this Agreement on the respective dates set forth hereafter.
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CITY SECRETARY
FT. WORTH, TEX.
City of Fort Worth, Texas
Mayor and Council Communication
COUNCIL ACTION: Approved on 312812006
DATE: Tuesday, March 28, 2006
LOG NAME: 02CHARTERGRANT REFERENCE NO.: G-15136
SUBJECT:
Authorize Settlement of Claims Against Marcus Cable Assoc., L.L.C., d/b/a Charter
Communications
RECOMMENDATION:
It is recommended that the City Council:
1. Authorize the City of Fort Worth, as a member of the consortium of eight cities (Burleson, Benbrook,
Duncanville, Fort Worth, Hurst, Keller, North Richland Hills, and Southlake) to settle the Consortium's
claims against Charter Communications for its alleged failure to comply with franchise-imposed customer-
service requirements regarding telephone answering time; and
2. Authorize the City Manager to execute all documents necessary to complete the settlement.
DISCUSSION:
In 2003, the Consortium notified Charter of its alleged failure to comply with franchise-imposed customer-
service requirements regarding telephone answering times during the fourth quarter 1999 to the fourth
quarter 2002. After extensive review of thousands of pages of documents, Charter and the Consortium
disagreed about the methodology used by Charter to determine "abnormal operating
conditions." Abnormal operating conditions have the effect of increasing the time within which Charter
must respond to customer telephone calls.
Based upon considerable review and evaluation of the data, the imprecisely written federal Cable Act, and
the uncertainties of litigation, Charter and the Consortium have agreed to settle the Consortium's claims
against Charter. Under the terms of the proposed settlement, the Consortium shall receive $1,000,000 in
four equal annual installments. Under the proposal, each Consortium city shall receive the following
annual payments, which are based upon the number of the respective city's
subscribers:
Benbrook $9,353.13
Burleson $6,378.13
Duncanville $11,653.13
Fort Worth $168,678.13
Hurst $13,253.13
Keller $11,353.13
North Richland Hills $19,428.13
Southlake $9,903.13
Charter agrees not to pass through to subscribers its obligations under the settlement. The payments to
the City are agreed upon as "community grants". Therefore, the payments should be deposited in the
Cable Communications Office Special Fund FE72 to provide programming for the benefit of cable
subscribers.
Approval of this settlement will not be construed as an abandonment of a meritorious claim by the
Consortium, their officers, agents, and employees. Any such abandonment is expressly denied. The City
and other consortium cities enter into the settlement to avoid only further time-consuming, costly, and
uncertain litigation.
FISCAL INFORMATION/CERTIFICATION:
The Finance Director certifies that the Cable Communications Office of the City Manager's Department will
be responsible for the collection and deposit of funds due the City from this settlement.
TO Fund/Account/Centers FROM Fund/Account/Centers
FE- $168,678.13
72 481306 002500100000
Submitted for City Manager's Office by: Richard Zavala (6222)
Originating Department Head_ Eileen Houston-Stewart(6415)
Additional Information Contact: Randy Westerman (871-6119)
FORTWORTH
WRITER'S TELEPHONE AND E-MAIL WRITER'S FAX
(817)392-7627 (817)392-8359
T.Gorski@fortworthgov.org
June 6, 2006
Ms. Marty Hendrix
City Secretary
1000 Throckmorton Street
Fort Worth, Texas 76102
Re: M&C G-15136
Charter Communications
Settlement Agreement
Dear Marty:
The attached copy of M&C G-15136 authorized the city along with seven other
cities to settle their claims against Charter Communications. The consortium cities and
Charter Communications have signed the settlement agreement.
I enclose duplicate originals of the agreement and ask that you 1) assign it a City
Secretary-Contract number, and 2) place the number on the duplicate and return the
duplicate to me. I will forward the duplicate to the lawyer for Charter. Please retain
the other duplicate in your file for safekeeping and easy access.
Thank you for your time and attention to this matter.
If you have concerns or questions, please call me directly at extension 7627.
Sincerely,
79�OeAvk
Theodore P. Gorski, Jr.
TPG:ac
Enclosure
c: Mr. Randy Westerman
OFFICE OF THE CITY ATTORNEY
The City of Fort Worth* 1000 Throckmorton Street*Fort Worth,Texas 76102
817-392-7600*Fax 817-392-8359