The Tacoma City Council can’t unilaterally chart its own course for Click Cable TV, according to a new city memo.
Utility Director Bill Gaines, in a Dec. 8 memo to the council, said the city’s lawyers have concluded the council must either accept as-is one of the plans outlined by the Tacoma Public Utilities board last week or it must send a revised proposal to the utility board for approval.
If the council does neither, the utility could shut down Click or transfer it to another arm of city government, according to Gaines: “Power could be forced to end non-utility commercial telecom services, or in the alternative turn over such functions to the City Council for oversight and funding through another department.”
The council is scheduled to take up the question as soon as Tuesday. Councilmen Marty Campbell and Joe Lonergan have offered proposals that, while not identical to the resolutions the utility board sent the council, follow their general directions. Unknown is whether any of the changes Campbell and Lonergan have made would rise to “material changes” that Gaines said must be ratified by the utility board.
The 1997 resolution that authorized the creation of Click says that the council must be involved in major policy decisions concerning the cable system, his memo states. But the city charter gives the TPU board sole authority over the operations of Tacoma Power, which oversees Click and uses a small part of the system’s capacity to communicate with its electric grid.
Translation: As long as Click is part of Tacoma Power, its fate is ultimately in the TPU board’s hands.
As long as Click is part of Tacoma Power, its fate is ultimately in the utility board’s hands.
The TPU board approved two conflicting paths for Click at a meeting last week. A majority voted first to develop a business plan that would allow the city to keep and expand Click Cable TV. In a second 3-2 vote, the board also endorsed offering the system for lease to a private company.
The first option — the so-called “all-in” model — would have the city craft a business plan that allows Click to provide Internet and phone service to customers, in addition to its current cable TV product. Tacoma also would pursue faster, gigabit Internet speeds.
The second TPU board recommendation would allow the city to lease the Click network to an outside company, which would take over all retail aspects of the business.
In March, Kirkland-based Wave offered to lease the Click system, prompting discussion among officials and the community about what to do with Click. Rainier Connect of Tacoma made an offer soon afterward.
If the council doesn’t approve one of the proposed courses of action or offer an alternative, Tacoma Power would be forced to dispose of Click, according to TPU Director Bill Gaines.
TPU officials say the status quo is not an option. If the council doesn’t bless one of TPU’s proposed courses of action or offer an alternative, Tacoma Power could be forced to dispose of Click, the Gaines memo states.
The reason: TPU lacks the legal authority to continue operating Click at a loss to Tacoma Power ratepayers, according to the city attorney’s office. Utility leaders say Click’s revenues are short of expenses to the tune of between $5.5 million and $7.5 million per year. As Click loses money, Gaines says, Tacoma Power ratepayers pay the price through their power bills.
Utility board member Monique Trudnowski said some ratepayers outside of Tacoma have expressed frustration that they are paying for Click when they don’t receive its services.
“People who live in franchise cities like University Place and Lakewood, they don’t have the ability to call up and say they want another power company” if they don’t want to subsidize Click operations, she said. “We are a legal monopoly.”
The council is not facing a deadline to decide which way to go, utility officials say.
“There is no plan in place to take any immediate action if they don’t take action,” said Bob Mack, deputy director of public affairs for TPU.