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CC 07-08-80 .. . . CITY OF .;upßTIJO, STATE OF CALIFORNIA 10300 Turre Avenue, Cupertino, CA 95014 Telephone: 252-4505 MINUTES OF TIlE ADJOORIIED REGULAR MEETING OF THE CUY COUNCIL HELD ON .JULY 8. 1980 IN TIlE COUNCIL CHAMBER, CITY HALL CUPEllTINO, CALIFORNIA Ce.- 509 Page 1 The meetin~ was called to orddr at 7:05 p.m. in the Council Cham~er of City Ball. !l.OLL CALL Counc. Present. Gatto, Plungy, Sparks, Mayor Rogers Staff Present: City Manager QuinldD Deputy City Clerk Csapagna-Blaise " .~ -'IO.\d"' City Attorney Kilian (7:20 p.m.) Mhyor Rogers welc~d and thanked all the cable companies for their pro- posals and ..aid that each firm had one-half hou~ f"r their presdntation., Mr. Quinlan opened the aeeting with a brief history of the Cable TV Study Committee and introduced three memòers, Joe Gruber, Kurt Wieking ud Len. Batchler and thanked them for their effor~s. He reported on the works of the co~itcee and the hiring of a consultant, and introduced M~. Cy Humph ries. Mr. Humphries explained how they came tn their conclusion on I!valuation. The presented report was rated by th~ following criteria: 1) proposed service package, 2) suitability. 3) proposed franchise agreement, 4) sys- tem technical viability, 5) financial viahility and 6) ~iscellaneoU3 cate gory, the most important being undergroundL~g. Each applicant was rated on the criteria and the highest rated were allowed to negotiate with the City to enter into a franchise. Presentations; Cablevision: Leo Hoarty showed a five minute video pro~tlctio~. Af.er the video program he remarked that Omnicon is fourteen months old and has a proposed 52 channels. Peter Cristiano talked about serviceabili:y rates and guarantees. Dorinda Hoarly talked about cOlIIDunity TV - courses from the collegp and library strictly to subscribers. Gill Cable: Louis Aoucie referred to their franchise and the underground impasse between Cupertino and Gill. Robert Coward referred to Gill technical performance and reference was made to their equipment being modern and not obsolete as in~inuated. He spoke of RtanJby power - how many homes are serviced and their own publication of programs. . CC-509 2 . . . MINUTES OF THE JULY 8, 1980 CITY COUNCIL MEETING Paul Monico, profesaional consultant, rated seven systems and Gill was nUlllbu one in their opinion. Bob Hoafeldt, Executive Vice Presielent and General Manager, remarked that they were not really an applicant because of their tee:hnical differences. Be reminded the Council about their franchise in portions of Cupertino and went on to aay they were leaders in aport and concert programs. Counc. Plungy asked if the aaterial presented to Council at this time was included in their original proposal. Mr. Hosfeldt answered that it was. and that it bad been prepared for Council in response to the consultant'a report. The numbers and specifi~ation9 contained with the column about Ðtanclby power which waa not specifically mentioned in ~:le ori¡:inal proposal '>re correct. They were taken directly from submitted ma_erial, and on that basis Hr. Hosfeldt stated that there was a serious flaw in the evaluation, the analysis and comprehension. Mayor Rogers askeel Hr. Monico to clarify his position with Gill. Storer Cable: Gary Massaglia, Director of Operations, presented w¡'·.t they had to offer. He went on to explain about costs, access channels, character keyboards and city functions. He stated if they get the franchise they would start work immediately. RECESS: 8:30-8:47 p.m. Teleprompter: Jack Hershant introduced some members of his firm (Kent Franky, Dick WatermPn, Tom Elliott, Sheila Beltrane and Pac Besson). He spoke about wanting undergroun~ cables, how large a company they are and went on to say he had written a letter dated July ~ co Travice Whitten, Assistant City Engineer. about the consultant's report. He said the report should be investigated because of incorrect statements. Dick Waterman expressed concern over the process of evaluation. He said the consultant took only the information on the written proposals to come up with the recommendations. Some data that was judged in the rating was not included because it was not specifically asked for, and they could supply that data if asked. Kent Franky exprpQsed his disappointment in the evaluation process and wL,dered wh) the City of Cupertino didn't check with the cities they serv,;....e. Mr. Quinlan replied that th~ City did check the general information with various cities and found all applicants ~ere supplying good service. Counc. Plungy asked Mr. Waterman if any material was left out of the consultant's report. Mr. Waterman replied that so~( had been left out. United Cable: Mark Van Welks, President of United Cable TV and Vice President of Marketing and Subscriber Services introduced some of his colleagues: Pet~r Rodkinson, Robert Henshaw, Harvey Boyd, Jeanine Hime, Irene nann, Jim Neece and Ken Daniel. He co~~ended the C0n- sultant and thought the proposal W38 thorough. .. . . MINUTES OF THE .JULY 8, 1980 CITY COUNCIL HEETING CC-509 Page 3 He said he thought that the recommendation based solely On written applications was an equal opportunity for each company to present th~ir company's proposal. He ~ the area of service they supply and talked of reas~nable rates, conatruction schedule which would be in twelve month Harvey Doyd spok~ briefly on the diversity to continue growth. Mark Van Welks again spoke on experience, rates ^nd depth of experience. Counc. P!ungy expressed ~oncern about major engineeri~6 ~roble.. and dir- ected his question to Mr. ~eece from Denver, Colorado. Hr. Neece said he sæw no engineering probleas at all. Mr. Van Welks volun~eered to anSwer any questions. Counc. Sparks expressed his concern aoout this firm in the near future beiug bought by a larger corporation. Mr. Van Welks replied there was a possibility. They have had offers but want to remain strictly cable TV and independent. Counc. Sparks asked if it was a closed corporation owned by three or four people or was it on the New York Stock Exchange. Hr. Van'Welks replied thpy were a public company and have 21,000 stockholders and stock is trad over the counter; ab~at 26% of the outstanding company is owned by key management and board members so they can control any unfriendly takeovers. kayor Rogerb thanked everyone f~r their professionalism and the high standards of their presentations. Counc. Gatto had some questions for Mr. Humphries, but let Mr. Humphries clarify some points first that the presenters had raised. Mr. Humphries said that the only documc~ts that would help control the situation in the future ~re existing ordinances and application docu- ~ents from the su~cessful applicant. He said that what was said ir wdting was the most important thing. With resp"ct to Gill's appl:,ca- tion about the tochni~al side of the evaluation they have an excellent technical record. They are doing a good job in San Jose, but their docu- ment on proposals (50 pages, Construction and Technical Specifications dated October 17, 1973 and catalog data from Thaydacom copywrighted 1972) together with a cop~ of the FCC rules and regulations formed the sub- stance of their technical submittal. These doc~ents with respect to ot;,er submitt.l documents and applicants and what they proposed could be called "State of Arts" and that's where their opinion came from. Counc. Gatto stated that Teleprompter had raised the question of Mr. Humphries coming into the evaluation procedure after the proposals Þad been received back from the various applicants. Hr. Humphries answered that each applicant had already made a prasentation to the committee. CùULC. Gatto asked that in reviewing the propobdls, did Mr. Humpè.ries ieel they were fair in providing information that should have been pro- vided with ~n adequate basis for ma~ing a decision. Mr. Humphrie~ said he thought each applicant had an eq"al opportunity to s'lbmit anything appropriate in terms of the submittal. The ones rated higher submitted CC- 509 .:4 . . . . MINUTES OF THE JULY 8, 1980 CIT': COUNCIL MEETING more material and they were more thorough and explained more about what they were doing. Counc. Gatto asked if Mr. Humphriea had had the written proposal initially, would he have substantially cnanged the format or the '=OIItent. Mr. liumphries said that Counc. Gatto vas talking about the "aequa.t for Applicatioas" document, and answered yes, he would have. Counc. Gatto asked if that vould have substantially changed tha respoaae.. Mr. Humphri..s answered that it would have changed some; they would .till see some difference. Counc. Gatto asked it there was any type of bonding or gusrartee that the City can employ to ensure compliance with the specifications and the ordinauces once the franchise if awarded. Mr. Humphries said the~e certainly is. Counc. Gatto asked if tbey had cor~idered the financial viability of the public access channels, as he had heard there needs to be a willingness and ability to pay to support certain types of p~ogramming - 'was that evduated in any ahape or form? Mr. Humphries said that vas considered in the evaluation in what was proposed with respect to the local orig- ination capability and the original proposals r.ontained no lavish propoaal for any things overdone, etc. Counc. Gatto asked if a systea that is followed by United or any other person could be fin~ncially feasible in this City without undue cost burden to the citizens. Mr. Humphries answcred yes, they proposed a reasonable balance between that and the community needs. There has been no outpouring of need for a highly sophisticated 24 hour a day type of local origination capability. Mayor Rogers asked about restructuring the RPP if Mr. Humphries had originated it and he might have bad a different response. Mr. Humphries said they would have asked for more information specifically in terms of what they wanted and that would have helped to make sure that tbe submittals contained all the information. Mayor Roge~s said that lacking that, did Mr. Humphries feel that the applicants were placed at a disadvantage for not having some things included or worded differently. Hr. Humphries said that the lack of inclusion of certain items shows .he lack of interest in them. The stronger proFos~ls have specifically come out and talked about all of the tr.ings that they felt were important whereas the others just talked about some of the highlight things. They saw that as a demon- stration of interest in the community and what the :leeds are and tryi"g to ¡ropose a fair p£ckage. Jack Birkholt, a citizen employed by the General Accounting Office in San Francisco, st~~øri that we get into bid p."tests quite often from the unsuccessful person or Congress. He dis~ussed the relation- ship of the receipt of the pr(posals, who had access, and thp- prepara- tion of the evaluation after thut. He s!:.ated that RFP's were not written as they should have been. . L . . . MINUTES OF THE .JULY 8, 1980 CITY COUNCIL HEETIRG Counc. Plungy agreeel with the cocsultant about a eleadline. Once there is a submission that ahould be final. He felt atrongly about institu- tional networlta. PrOldøea are -.Ie and we ..u adjwotllenta. Counc. Gatto complf.rlo.nted the firms that submttecl applicatione. Be ..iel that the procedure, even though it had 80M f~, in tha long run ... adequate and would give the needed resulta. It was moved by Colmc. Gatto, seconded by Counc. Sparks and passed unan- imously to take the re~endation of the consultant anel authorize the City Manager to begin nesotiationa with United Cable. Mayor Rogers stated that after 45 days· of negoation, if an agreement had not been reached, that the second firm on the liat would be asked to negotiate. At 10:06 p.m., the _eting was adjourned to July 21, 1980. ft~~~~- I CC" 509 Page 5 I lIegotiations with United Cable