Cable ONE under review, City, County agree to audit contractPublished 12:02am Friday, December 14, 2012
NATCHEZ — The City of Natchez and Adams County both approved this week individual audits of their franchise agreement with Cable ONE to ensure the company has properly paid them over the course of the agreements.
Cable ONE pays 5 percent of gross subscriber revenue each to the city and county.
Ward 3 Alderwoman Sarah Smith, who is chair of the city’s utilities committee, said the audit is in preparation for negotiations to renew the franchise agreements for both the city and the county.
The Natchez Board of Aldermen voted in August to extend its contract with Cable ONE to allow the city to explore its options of cable service. Smith said it was also to allow the city and county cable agreements to expire at the same time.
In doing that, Smith said, the city and the county were able to save $3,000 each on the audit. Local Government Services of Dahlonega, Ga., will be conducting the audit, and the company usually charges $10,000 for the audit, but Smith said the company gave the city and the county a discount because both entities enlisted the company’s services.
Smith has been working with Supervisor Mike Lazarus on research for renewing the cable agreements, and both officials said they believe the audit is a good idea.
In addition to ensuring the city and the county have been properly paid due fees, Smith said the company will draft a franchise renewal agreement, conduct a survey of residents and their preference for cable service and negotiate with Cable ONE on the terms of the agreements.
Smith said a representative from Local Government Services has already taken a look at the city’s franchise agreement and discovered things that need a second look. For example, she said, the agreement has no provision outlining the late payment of franchise fees, the possibility of Cable ONE paying the audit fee in the event it owes the city money and certain customer service issues.
A particular formula is used to calculate the city’s share of the revenue from Cable ONE.
“(The representative) feels like we’re a little bit lower than what he feels we should be getting paid,” Smith said.
An independent audit of the cable agreement is beneficial, Smith said, because the city does not have the knowledge to know what to look for in the agreement.
“We just don’t have the knowledge and capability of making sure this is all done for the best benefit of the city and its residents,” Smith said.
County Attorney Scott Slover and County Administrator Joe Murray said they agree with Smith.
“When you have these big contracts, it’s not a bad idea to have a third-party company come in and check them out,” Murray said.
Furthermore, Smith said, the city’s and county’s franchise agreements look identical, which she said likely means that Cable ONE drafted the agreements.
“We don’t think it was drafted from (the city’s) end, and we want to make sure we’re getting the best deal and best franchise for the city and our residents,” Smith said.