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Colorado Springs City Council OKs higher Comcast fees and medical marijuana business fees

June 27, 2017 Updated: June 28, 2017 at 8:12 am
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The Colorado Springs City Council has a busy agenda Tuesday afternoon. Image via Google Maps.

With reluctant votes by some members and failed amendments by others, the Colorado Springs City Council passed a controversial ordinance Tuesday to increase the fees cable TV providers pay the city.

Those increases will be passed on to customers.

Over more than two years, the ordinance will raise Comcast's franchise fee of $1.53 a month per subscriber to a flat 5 percent of the company's gross cable revenues. At that point, it will raise an estimated $3 million more a year and will cost a subscriber $3.47 a month more.

The council passed the ordinance 7-2. Councilmen Don Knight and Andy Pico opposed the measure.

In past hearings, residents spoke out against the increase and criticized Comcast's inability to serve the Cedar Heights area, which the company said is too far from its distribution point.

Before the council voted, Knight and Pico moved to amend the arrangement.

Knight moved that Comcast be required to serve Cedar Heights within 18 months. Pico moved to eliminate the fee increase. Both motions failed.

"I have a problem with the idea that we have to catch up to everybody because the standard is 5 percent," Pico said.

The council passed the ordinance, but not before addressing some concerns.

Council President Pro Tem Jill Gaebler called the estimated $1.3 million needed to extend service to Cedar Heights a "drop in the bucket" for Comcast and asked the company to reconsider.

Councilwoman Yolanda Avila and Councilman Bill Murray said they were reluctant to support the ordinance, but the fee should have been set at 5 percent years ago.

The franchise fees are what companies pay to use the city's rights of way. Virtually every government entity in Colorado charges 5 percent.

The ordinance also would require Comcast to provide two closed-circuit, high-definition channels for city firefighter training and to meet standards for addressing complaints, responsiveness and treatment of property.

The city currently collects about $1.2 million a year in franchise fees from Comcast, CenturyLink and Falcon Broadband. Its cable contracts stipulate that any franchise fee increase applies to all providers.

The city doesn't yet know how it will use the extra revenue, said Chief of Staff Jeff Greene.

The fees will increase in 90 days to 3.5 percent of Comcast's gross cable TV revenue. After a year, the fee will rise to 4.5 percent and will plateau in another year at 5 percent, the maximum allowed.

The ordinance gets a second vote July 11 but typically will be approved as an item on the consent agenda.

Also Tuesday:

◘ The council unanimously voted to raise medical marijuana dispensary licensing fees to cover industry oversight, which is increasing, and to hire more staff to process paperwork.

Beginning Aug. 1, fees for new applications will rise from $2,200 to $2,500, and annual renewal fees will climb from $1,800 to $2,600. The increased fees are estimated to generate $282,200 each year.

◘ Food trucks and food carts now can park in metered spots downtown and in Old Colorado City. They must apply for city permits allowing them to reserve metered parking spots twice a year for up to 12 hours at a time.

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