Manteca’s city leaders have 642,000 reasons why they want to keep Comcast customers happy.
The 5 percent franchise tax the city slaps on monthly cable bills of Comcast customers is Manteca’s third-largest source of general fund revenue after property and sales taxes.
Those that opt for satellite or Internet-based TV and/or movie services over a cell company wireless service are not subjected to the franchise tax.
That’s because the city’s ability to levy a franchise tax is based on the fact Comcast uses municipal right-of-way.
Should cable per se disappear so does the city’s ability to fund the equivalent of roughly six police officers or firefighters.
Having said that, it is doubtful the bizarre tug-of-war the City Council is engaged in with Comcast over whether it can close an office it already has closed has anything to do with individual council members’ concerns about municipal revenue.
Last month when the council first balked at acting on the office closure request, they were concerned city staff had negotiated too little in exchange for Comcast not being able to honor the Manteca-based office provision of their contract for the next 18 months. What was on the table was high-speed Internet service for city offices that probably would have cost hundreds of dollars a month if Manteca had to pay for it.
When the matter came back up this week, Comcast had sweetened the pot with a $10,000 technology grant for the city to use as it saw fit. But the council’s concern had taken a dramatic shift. Now — after being peppered with complaints mostly from senior citizens — the focus was on convenience for Comcast customers.
And although Comcast had lined up a local vendor – Ramirez Satellite at 333 North Main Street that’s in a much higher profile location than the office they’ve shuttered — and arranged for three Manteca locations where in-person payments could be made, it apparently wasn’t enough.
Coupled with Comcast’s effective house call system plus online and electronic transfer via phone capabilities, it is significantly easier and more convenient to deal with Comcast as a customer than it was 18.5 years ago when the non-exclusive franchise agreement was signed.
Vince Hernandez seemed to understand that when he was the only council member who voted against the council position du jour to have the matter come back to them in six months.
Although much fanfare was made about customer service, the real issue this time was finding ways that Comcast could extend its service in Manteca, primarily areas in the downtown district. Comcast originally served residential customers only and as a result did not include commercial districts in its cable distribution system as they do now.
Here’s the rub: It costs money to extend cable whether it is in the air between poles or buried. It makes absolutely no sense from a business standpoint for Comcast to do what the city is requesting unless they can cover their costs and make a profit. Unless they have an ironclad guarantee from the city that they can get hundreds of new customers who are locked in for perhaps 10 or 20 years to cover their costs or get them to front the cost of extending service upfront, there is no way Comcast is going to do what the council would like to see them do.
If it made financial sense, Comcast would already have done it.
There is even a bigger issue on the table, the city’s credibility. This is the second time a gigantic media company has blatantly ignored legally binding contracts with the City of Manteca.
The outdoor advertising division of CBS for 10 years has told the city they won’t honor contract provisions that gave Manteca the power to pull the plug on four billboards that are now on city park property along Moffat Boulevard. Basically the city was told if they try to enforce the legally binding terms for removal that was agreed to by both parties in the contract that CBS would sue them to kingdom come.
The city won’t litigate and Comcast knows it. The numbers to do so don’t make sense from the city’s perspective.
So what will the council do in six months when nothing comes of their latest position on the Comcast office closure? Perhaps they could ask for custom premium packages tailored specifically for Manteca residents. At any rate the office will still be closed — which is what Comcast asked permission to do in the first place — and what leverage the city had initially will be further diminished.
Ironically, if the council had been concerned about those 642,000 reasons to keep Comcast customers happy in the first place they might have been able to make everyone happy.
It would be in the city’s best interest if Comcast had a retail center similar to the location of the Pelandale store in North Modesto here in Manteca. Not only would it keep existing customers happy but it could peel away satellite users and even stop people from jumping to up-and-coming TV services.
The city could offer to give up future growth in franchise fees — assuming it is legal to do so — to work with Comcast in securing a Manteca location in a high-profile retail center.
After all, that was the rationale the city used in deals with Costco and Bass Pro Shops to get them to locate in Manteca sooner instead of later or never.
This column is the opinion of executive editor, Dennis Wyatt, and does not necessarily represent the opinion of The Bulletin or Morris Newspaper Corp. of CA. He can be contacted at email@example.com or 209-249-3519.