2 responses to “Internet TV Sites Free”

• 

  minass March 27th, 2012 at 15:00

  From Journal. What caught my eye was comment that she understands the gravity of the situation. If her posts here are any guide, she I also spoke w/ a finance person at APT who clearly grasp it either, although to be fair, each of them might well have been brought up to speed in the last couple of days.

  This will get a lot worse before it gets better.

  Finance officers blast AP&T debt
  City treasurer, auditor co-sign letter stating $85 million obligation could doom utility, damage fiscal stability
  By Jeff Mitchell
  EDITOR
  The two top elected finance officers said this week that they fear Alameda Power & massive debts will soon doom its troubled cable TV operations and threaten the overall financial stability.

  In a letter to the Alameda Journal and in follow-up interviews, City Treasurer Kevin Kennedy and City Auditor Kevin Kearney said they are demanding that members of the City Council and the Public Utility Board quickly present a plan addressing how the utility plans to retire the $85 million in debt it has amassed.

  of that, Kennedy and Kearney say the city would be well advised to consider selling the troubled cable operation so that at least the financial hemorrhaging can stop.

  The accumulated debt — approximately $40 million in bonded indebtedness and about $45 million in so-called “inter-fund” loan transfers from electrical division — means that the utility would have to generate annual payments of about $5 million over the next 30 years to retire the debt, Kennedy and Kearney said in the letter.

  “Show us how this is going to work,” Kennedy said. “Give us the whole game plan. Maybe there is something there that we know about.”

  Kearney was more blunt.

  “Given what we do know, I would sell the cable TV system immediately to at least stop the bleeding. We have to get away from this approach,” he said.

  No official response

  Alameda City Manager Debra Kurita, who also is a voting member of the Public Utility Board, AP&T interim General Manager Ronald Stassi and Mayor Beverly Johnson all failed to respond to requests seeking comment on the letter.

  However, Ann McCormick, chairwoman of the utilities board, said she understood the gravity of the debt situation.

  “I am not questioning their math,” McCormick said of Kennedy and calculations. “This is a serious problem, and taking it very seriously.”

  McCormick said she believes the utility needs to ramp up its public outreach, possibly even holding workshops to discuss and explain the financing plans and decisions.

  She added that the city and the utility may need to looking at the cable TV system from a “cost-benefit” perspective — meaning that in exchange for city and rate-payer subsidies, local residents will continue to have local control over rate-setting and programming choices.

  “We know that subscriber costs will rise and that we would be at the mercy of a monopoly,” McCormick said, referring to Philadelphia-based Comcast, the current commercial market leader.

  Currently, AP&T has 10,163 subscribers while Comcast has approximately 9,200 in the city. About 3,300 Alamedans get their TV programming from satellite providers, while 7,538 continue to draw their TV off the air.

  “We may reach a point where we have to ask ourselves is having our own cable TV system subsidizing?” she asked.

  “interfund” transfer loans were first detailed in a Sept. 26 Alameda Journal That detailed that AP&T transferred about $43 million (now believed closer to $45 million) from its electric utility division to its fledgling cable TV operation in 2000.

  The transfers were made quietly and in apparent contravention of what voters were told two years earlier when they passed a city amendment allowing AP&T to go into the cable TV business.

  Elected officials promoting the amendment told voters at the time that a “firewall” would be created to prevent AP&T from using the electric assets to help build the cable system.

  The semiautonomous Public Utilities Board is appointed by the City Council, which has maintained heretofore a loose budgetary oversight authority of the utility.

  All members of the current City Council have in recent years voted to approve AP&T budgets, all of which included information on the interfund transfer loan programs.

  Only during the recent city election did calls for an outside audit of the books surface.

  No magic cure

  Kennedy and Kearney said they doubt whether AP&T can indeed repay the interfund loans or its bonds given that the utility forecasts taking in just $7.7 million in total revenues in 2007.

  They added that while AP&T controls about 45 percent of the cable TV and Internet provider market on the Island, the utility would have to capture every other available customer in the city — an improbable proposition given the presence of Comcast and satellite TV providers — to begin to right its financial boat.

  And, even if that happened, there still would not be enough revenue rolling in to begin paying back the debt in any meaningful way, Kennedy and Kearney concluded in their letter.

  “Total debt is now around $85 million. If this debt was paid off over the next 30 years, payments would total about $5 million per year. That means is really a $5 million loss. Even if we pay this off over the next 100 years, the annual cost is over $4 million. The debt will not magically go away,” they wrote.

  The men noted that the $5 million-a-year repayment schedule is a sum that currently exceeds the parks and recreation, planning and city administration budgets.

  Kennedy said the financial problems will likely come to haunt the city proper, sooner or later. He sad that if AP&T began paying down the debt, the historical annual injection of $2 million to $3 million into the general fund will most go away.

  “At the end of the day, financial problems become the financial problems,” they wrote.

  Longtime AP&T observer and critic Len Grzanka agreed with the pair.

  “My worry is that the utility rate-payers will have to cover these costs or the taxpayers may have to approve a parcel tax to cover the debt or Alameda may have to default on the telecom bonds, impairing its credit rating and raising the cost of future debt-financing,” Grzanka said. “Whatever the scenario, I believe Alamedans will lose as a result of this risky experiment with municipal cable TV.”

  To be sure, AP&T officials have said they will soon stop the practice of “interfund” loans and that they have committed to begin paying themselves back in 2020.

  Kennedy noted that the utility is carrying the loans on its books as an asset, not a liability. If the PUB or the city were to try to forgive the utility from having to pay itself back, the effect would likely damage credit and possibly the as well, he said.

  Both men lament that members of the PUB, city administration and the City Council have continued to deny them copies of a recent private on the status of the troubled cable system.

  That by Beltsville, Md.-based CCG Consulting LLC, is believed to have included at least two assessments of the cable TV in pieces or sold as a whole. CCG was also asked to perform an “operational audit” of the telecom staffing levels, salaries, programming costs, network configuration and debt structure.

  To date, that has not been provided to either Kennedy or Kearney.

  “A plan that incorporates how this debt will be addressed is needed now, not years from now. The longer we wait, the bigger the eventual bill becomes,” Kennedy and Kearney wrote.

  Reach Jeff Mitchell at or 510-748-1656.

• 

  Zach March 27th, 2012 at 22:45

  After a time offensive words are allowed. been watching Comedy Central late at night and heard every cuss word coming out of the comedians mouth.