City officials are not happy that TCI Cablevision is increasing rates to Provo subscribers more than other subscribers, but there's not much they can do about it.
On June 1, the rate for TCI's basic service will increase from $9.28 a month to $10.47 for Provo subscribers. The rate for expanded-basic service will increase from $14.36 to $17.17 a month. Charges for equipment and other services also will increase. Customers will see the increases on their June bills."It's a significant increase, but it's the cost of doing business in this market," said Mike Oswald, general manager of TCI's Provo office.
TCI, which serves about 80 percent of the state's cable subscribers, is raising rates about 10 percent statewide. The rate increase for Provo's 15,000 subscribers is more than 15 percent.
TCI also serves Payson, Spanish Fork, Elk Ridge, Nephi and Salem. Subscribers in those markets will see an increase of about 70 cents per month for expanded-basic ser-vice.
Oswald said each rate increase is based on the amount of subscribers in each market. Also, Provo subscribers get 62 channels on expanded-basic service, more than other Utah markets.
"You'd have to go quite a distance to find any other system that offers the channels and programming that we do," Oswald said.
The Provo Cable Board feels the rate increases are too much and unjustified. Board Chairman Frank Seely said TCI should not raise rates unless the company plans to add channels.
"If they want to raise rates, they should give us something else," Seely said.
New federal regulations allow cable companies to adjust rates annually, rather than quarterly. To raise rates, cable companies must file forms with the Federal Communications Commission outlining that the increases are based on increasing costs. New rates are figured on last year's costs and a prediction of next year's costs. TCI last raised rates in February 1995.
TCI's franchise agreement with the city says rates can only be increased a maximum of 5 percent. However, Oswald said FCC guidelines pre-empt the terms of the franchise agreement. Assistant City Attorney Robert West said the cable company is likely correct.
"We're trying to see if there's any loopholes that we can use," West said.
The city can also audit the forms TCI submitted with the FCC, but West said the reports appear to be accurate.
"Everything we've done leads us to believe they've complied," he said.
Council members passed a resolution a few weeks ago that encourages more local cable competition and says the rate increases will be considered when TCI's franchise agreement comes up for renewal. Also, city officials will notify Utah's congressional representatives about their displeasure with the increase.
Oswald said the resolution has little effect other than to show the city's disapproval.
"We didn't take this rate increase lightly. We scrutinized it very thoroughly," he said.