Wednesday, May 12, 2011
By Erika Jacobson Moore
It appears it is now the state’s turn to determine whether there is any chance for change for residents of Southern Walk at Broadlands and Lansdowne who are receiving cable service through exclusive agreements set up between their then-developer controlled HOA and the Dulles-based telecommunications firm OpenBand.
Emerging from a closed-session briefing Wednesday morning, the Board of Supervisors’ Finance, Government Services and Operations Committee voted to recommend the full board request Attorney General Ken Cuccinelli begin an antitrust investigation of OpenBand because of its exclusive easements in the two communities. Residents, and many supervisors, note that even if the HOA contracts were amended to remove the requirement for homeowners to pay for OpenBand services, the exclusive easements prevent competing providers, such as Verizon or Comcast, from running lines to the homes and businesses.
The County Attorney’s office had recommended the closed session to answer supervisors’ questions because of the legal issues involved. All answers that can be made public-many of which have been requested from residents-will be so supervisors can respond to their constituents.
The county has been reviewing its franchise agreement with OpenBand, with the Cable/OVS Commission debating this issue for more than a year, and a public hearing before the board on the new terms scheduled for June 13. The committee today also recommended the board hold a second public hearing in October to give residents a chance to comment on any further amendments made to the agreement.
While many residents are urging the county to help break the exclusive nature of the contract by rejecting the franchise agreement, many supervisors and those involved in the issue acknowledge that such action would not give the residents what they really want: a choice.
The antitrust investigation, supervisors said, might get them there.
The board action, as recommended by the committee, request Cuccinelli proceed with litigation if he determines there is cause for such a step.
“If he decided there were no basis for litigation there won’t be any. If he decides there is, I hope we would support him in bringing it,” Supervisor Stevens Miller (D-Dulles), who district includes Southern Walk, said. “Those people have been waiting a long time to see their government take some type of actual step to help them.”
Not all supervisors on the committee were pleased with the recommendation, however. Supervisor Eugene Delgaudio (R-Sterling) said he would have preferred getting a simply legal opinion from Cuccinelli, as part of the process of gathering information about the OpenBand concerns.
“Of course the attorney general has the option of having an investigation,” Delgaudio said. “But this is the first option in the process. Coming out of closed session and jumping into anti-trust law, that is quite a leap. That is presumptuous.”
Delgaudio claimed the request for state action also removed any value to the public hearing and the county’s review of the OpenBand franchise, but other supervisors said it was time the issue moved beyond the county. They also said asking for a legal opinion was not enough.
“If we’re to going to ask for a legal opinion, I don’t see any sense in asking the attorney general a second, a third, or fourth level question that our own attorneys could answer,” Supervisor Jim Burton (I-Blue Ridge) said.
In 2001, Broadlands developer Van Metre and OpenBand entered into a contract that allows the telecommunications carrier to provide exclusive service to the residents for a period of at least 25 years, with the option for an extension of up to 75 years. The Southern Walk HOA was created specifically so the telecommunications infrastructure could extended to the southern part of Broadlands, and was created at a time when Van Metre controlled the greater Broadlands HOA, of which Southern Walk residents also are members. Control of both HOAs has since been turned over to the residents. Under the deal, residents are assessed monthly fees by the HOA for television, telephone and Internet services and those fees are paid to OpenBand.
The Lansdowne on the Potomac has a similar contract with OpenBand, with an obligation up to 75 years. When Lansdowne was first being developed, OpenBand competed to provide service for the community and the telecommunications company was offering to install fiber, something not being done by other providers. A similar process was undertaken with Southern Walk’s developer as well. The way the agreement is set up, OpenBand has exclusive access to the easements, making it difficult for other companies to provide services even if the exclusivity agreement was challenged.
Many residents in recent years have switched to using satellite companies for their television service because of what they call poor service and offerings through OpenBand. But they still pay the OpenBand price through their ongoing HOA fees.
While the county does not have any control over the contracts and can only approve or deny the new franchise agreement, many residents have called for the board to intervene on their behalf and oppose OpenBand’s agreement. Today’s action appears to be that first step. And the HOAs are already responding.
“The HOA board is pleased that the Board of Supervisors understands how complex the contract and the easement situation is. The board is pleased to hear that the BOS is taking decisive action to help our homeowners,” Erika Cotti, president of the Southern Walk board, said. Cotti also served on the county’s Cable/OVS Commission, and has been one of the most outspoken voices against OpenBand and the circumstances thrust upon homeowners.
Lansdowne HOA board members are conferring, and a formal response is expected shortly.
Response is also expected from OpenBand to the committee’s action. Representatives were present at this morning’s meeting. More information will be reported as it becomes available.