County to ask OpenBand for new franchise.

By Erika Jacobson Moore

Leesburg Today, Oct. 21, 2010

This week brought a new twist in the ongoing wrangling regarding OpenBand, its franchise agreement with the county government and its relationship with the homeowners’ associations it serves. The county’s Cable & Open Video Commission has requested a new franchise agreement from the telecommunications company, choosing that course instead of moving forward on plans simply to renew the company’s existing agreement.
That decision has brought a measure of cautious optimism for critics of the company, which holds long-term, exclusive contracts to provide video, telephone and Internet services to thousands of residents and businesses in Broadlands at Southern Walk and Lansdowne on the Potomac, while others are still skeptical of the company and are calling for nothing less than the option to choose services from competing cable providers.

“It’s only better if they also put it out for competitive bid,” Lansdowne resident John Footen said. “If they put it out only to OpenBand again, it’s only slightly better than a straight renewal.”

For the past year the Cable & Open Video Systems Commission has been reviewing the franchise agreement between the county and OpenBand, working to determine whether it should recommend that the Board of Supervisors grant approval of a renewal. That review has been slowed by continued community opposition to OpenBand, the services it provides, and the multi-decade contracts it has with homeowners associations. But it was the discovery that the existing franchise agreement had lapsed in June 2009 that caused a real pause for many residents, and left many wondering who dropped the ball.

The expiration of the franchise came without the request for renewal that is required under the terms of the agreement 12 months before the franchise expires. It was not until November 2009, when the county was alerted that the franchise had lapsed, that the commission began evaluating the renewal options.

County ordinance requires that cable and telecommunications companies have an active franchise agreement with the county to provide services to communities and residents. The franchise agreement, however, has a clause that allows OpenBand to continue to serve residents up to 36 months after the franchise expires as long as work is underway on a renewal.

But the lack of a request for renewal led many residents who are unhappy with OpenBand’s services to claim the company is providing video and cable services illegally, and call for the county to deny any renewal.

Last week, the cable commission attempted to simplify the issue and, on the advice of counsel, directed OpenBand to submit a new franchise agreement. The deadline for that new agreement submission is Nov. 10. The vote to ask for a new franchise agreement was unanimous, with only Commissioner Michael Wasjgras (Sugarland Run) absent for the vote. The At-Large seat on the nine-member commission is vacant.

Once the new agreement has been submitted, the commission will begin its review of the documents. And one thing that is certain to be part of that review is the many comments that have been received from residents during the past several months.

“We’ve taken comments from those and, if they’re reasonable, we will put those in and try to negotiate with them,” Commission Vice Chairman Karen Guthrie (Broad Run) said. Once the agreement has been negotiated, the commission will make a recommendation to the Board of Supervisors who will have the final vote on the matter.

Guthrie acknowledged that the commission is in a “unique situation” since requests for new franchise agreement submissions normally lead to calls for anyone who might be interested in providing the cable services to specific areas. But M.C. Dean, the company that owns OpenBand, also owns the easements in Broadlands at Southern Walk, Lansdowne on the Potomac and Lansdowne Village Green, and has exclusive rights to them. “So really the only new applicant can be OpenBand,” Guthrie said.

OpenBand has held a franchise agreement with the county since 2005, but many residents have complained that the exclusive agreement leaves them with less than satisfactory service and technology, and no recourse except to pay for services like a satellite dish in addition to the OpenBand payment that is included in their HOA fees. Lansdowne on the Potomac residents pay $142.73 of their monthly assessment to OpenBand, $47.28 of which goes to cable. Lansdowne Village Green and Southern Walk residents pay approximately the same amount monthly to OpenBand for bundled services.

The contract entered into by Broadlands developer Van Metre and OpenBand allows the telecommunications carrier to provide exclusive service to the residents for a period of at least 25 years, with the option to extend to up to 75 years. The Southern Walk HOA was created simply to allow for extension of OpenBand’s services into the community. The Lansdowne and Lansdowne Village Green communities have a similar contract with OpenBand, with an obligation up to 65 years.

While the Southern Walk HOA board has been active in its campaign to win improved services and against the exclusive OpenBand contract, it was only hours before the commission’s Oct. 13 vote that the Lansdowne on the Potomac HOA board took its first steps toward a public position about the franchise.

In a letter sent to the commission and the Board of Supervisors, the Lansdowne HOA Board of Directors asked that the county make the franchise renewal “contingent” on resolving “outstanding quality (technology and service) issues.” In its letter the HOA board spelled out its attempts to meet with OpenBand and get the company to renegotiate the 65-year contract, to no avail, and by having a contingent renewal “ultimately the question of whether OpenBand’s failure to remain competitive with other local video services providers is a consequence of its small size or a result of long-term, one-sided contracts that eliminate market pressures will be answered.”

Monday, days after the commission took its vote requiring a new agreement, HOA Board President John Whitbeck said a new agreement might provide even more opportunities to get residents’ concerns addressed.

“If they’re asking for a new franchise agreement versus a renewed franchise agreement, that is favorable for us being able to work with OpenBand for terms that are acceptable to our residents,” Whitbeck said. “We are hopeful that the Board of Supervisors will listen to its constituents in forming a new franchise agreement that addresses the concerns various HOAs have had with OpenBand.”

Since the letter to the board has been made public, there are some residents who have accused its HOA board of “folding” on the OpenBand issue, but Whitbeck said that is not the case.

“We have looked at every angle of this that I can think of,” he said. “We have obtained two legal opinions, our regular attorney’s and a subsequent law firm…the renewal process is one that is important. It was our board’s decision to work within the process.”

Whitbeck acknowledged that there were other recourses available to the Lansdowne HOA, but said that is not the path the board is choosing to take at this time.

The Southern Walk HOA has announced its intent to file a Federal Communications Commission complaint against OpenBand unless its concerns are resolved in a timely manner. For some Lansdowne residents, that is the route their community should be taking.

“I would like to see the HOA support denying the franchise to the county and represent what is clear the overwhelming majority of residents want,” Footen said.

Footen, who works as a television technology professional, said there are significant failures in OpenBand’s services that will not be able to be addressed easily.

“There is no way that OpenBand can keep up with the way technology is changing. For them to maintain and keep up with the competitors is nearly impossible. They are already falling behind. And that can only get worse,” he said.

Footen and a group of residents have been doing their own survey of Lansdowne residents, trying to get detailed information about what homeowners really think of OpenBand and the long-term contract. According to data collected by resident Kevin Donovan, residents have gone door-to-door and spoken to 416 residents. With only one member of each household signing the petition opposing OpenBand and its contract, 372 have signed, 29 are undecided and 15 have chosen not to sign.

“That is a sample of 89 percent of the residents who are saying they are unhappy with OpenBand and they want something else,” Donovan said. “That’s an overwhelming statistic.”

The signature collections began in July and the residents are going to continue their efforts to reach as many of Lansdowne’s almost 2,200 residents as possible. “Because of the process we have taken, it takes a long time,” Footen said, “but we want to get as much data as possible.”

The men encourage those who have not been reached at home about the petition to e-mail with their position.

Even though the HOA board does not have scientific polling data, Whitbeck said he was “pretty confident a majority of our residents would like to see OpenBand either vastly improve themselves or switch providers.”

Like the Lansdowne residents, the Lansdowne Village Green HOA board also is working to get the feedback of its own residents since it took over control of the HOA from the developer in June. Just before the board was turned over to the residents the HOA formed a technology committee to examine the issues with OpenBand’s service.

“The tech committee took it under their course of action that they would work toward dealing with the pricing, then the technical issues,” board president Tom Jeavons said. “Then at some point it hopes to address the long-term contract issue.”

In the community’s August newsletter a satisfaction survey was sent out to all residents, and so far the responses have been that residents feel the prices are “completely out of line for what they are getting,” Jeavons said.

Jeavons acknowledges that as a new community, many of the newest residents do not understand the issues, or the length of the HOA’s contract with OpenBand. But as they learn, they speak up, he added. So for now, Jeavons, his board and the technology committee are working to get a clear picture of what the interests of the community are and move forward from there.

“Our position is pretty straightforward. You have got to have some type of service provider,” he said. “But OpenBand does not appear to be meeting the needs of our homeowners. We want to be sure that the residents get the quality they want and their money’s worth.”

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