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Home My WebLink AboutUtilities 2007-09-05 Item 3B - City Channel INFORl\fATION MEMORANDUM To: From: Date: Subject: Mayor Mullet Public Works DepartmenL<l:;;rr) August 27, 2007 IT \ City Government Channel ISSUE Approve purchase of City Government Channel equipment from TelVue Virtual Television Networks (TVTN) and if required, extend current Franchise Agreement with Com cast. BACKGROUND During a Regular Council Meeting, Council approved Staff's recommendation for a Tukwila Government Channel and supported a pass-through of approximately $.25 per subscriber to cover capital costs. Shortly after Council approval, the City formally requested Comcast to design, procure, and install head end cable cast equipment. Comcast completed installation and testing of their equipment early this month. The final phase of the City Channel Project is the procurement and installation of digital broadcast equipment. DISCUSSION As part of the procurement process, Staff contacted several equipment vendors. Except for TVTN, none of the vendors offered a complete, integrated TV system. Given TVTN's unique suite of state-of-the-art digital broadcast solutions, Staff recommends purchase of capital equipment and services from TVTN. TVTN provided quotes for three different package options (Attachments 1-3). Quote 1 provides a full range of digital multimedia broadcast solutions including 24/7 remote operations, web channel monitoring, and managed services. Quote 2 provides all the equipment needed to run a cable TV channel but at a smaller scale. TVTN also has a Sponsorship (underwriting) Program (Quote 3). This Program reduces the overall capital and operational costs. Quote 3 provides the same equipment, software and services as Quote 1 but at a significantly reduced cost. In consideration for the price reduction, the City must agree to the terms and conditions of the Sponsorship Program. A summary of the sponsorship guidelines including permissible and non-permissible activities is provided at Attachment 4. From a fmancial and operational perspective, Quote 3 offers the most viable option for the City. The City Attorney's Office conducted legal review ofTVTN's Sponsorship Program and determined that the City could pursue this option provided that internal controls and sound operating procedures are developed and implemented to ensure compliance with the Federal Communications Commission (FCC) guidelines. In keeping with Council's intent to maintain the pass-through costs at approximately $.25 per subscriber, the Franchise Agreement with Comcast may have to be extended depending on the option selected. The current Franchise expires on February 1, 2009. Quote 1 requires a 2 Yz -year extension and a pass-through of approximately $.24 per subscriber. Quote 2 requires a one-year extension and a pass-through of approximately $.20 per subscriber. Quote 3 will not require an extension. The pass-through cost for Quote 3 is approximately $.17 per subscriber. In summary, Staff is seeking Council approval to purchase City Channel equipment on a sole source basis. Due to lower capital and operational costs, the Sponsorship Program Package (Quote 3) offers the best value for the City. Finally, in order to keep the pass-through costs at approximately $.25 per subscriber, the existing franchise agreement may have to be extended for up to 2 Yz-years. RECOMMENDATION Present to the Committee-of-the- Whole for discussion, approve sole source procurement (Attachment 5), select package option, and if required, approve extension of the existing Franchise Agreement with Comcast. Attachments: TVTN Quotes (1-3) Sponsorship Program/Guidelines Draft Sole Source Resolution P:frank\2007\franchise\govemment channel [iVTNQ. rr~~:" Princeton Server Group July 12,2007 A'ITACHMENT 1 Frank lriarte City ofTukwila 6200 Southcenter Boulevard Tukwila, Washington 98188 Attn: Frank lriarte Summary Cost ( Quote # 1) Expiration 90days Summary IMonthly Fee (includes upgrades) 2 One time Set up Fee Equipment Cost $ 850.00 $12,000.00 $12,203.00 Terms - 60 Months Cable Company - Fee Breakdown (Cable Company pays Capital cost) Note: Based on TVTN's accounting department analysis the following can be used as Capital Cost lCapital portion of Monthly Fee 2Capital portion of Set up Fee Equipment Cost 3Total Cable Company Cost (Capital-one time fee) $ 467.50 $ 8,040.00 $12,203.00 $48,293.00 Municipality - Fee Breakdown (City pays Expense cost) lExpense portion of Monthly Fee 2Expense portion of Set up Fee Total Municipality cost over 60 Month Term $ 382.50 $ 3,960.00 $26,910.00 Total Municipality cost Amortized over 60 Month Term $ 448.50 (per month) Kind regards, /1'"'0- -h, ~ . '/J . L C,-<--. '.'j Larry McCain U:-VTN" cC:1~tGroup Divisions of Telvue Corporation 732-213-4730 - Mobile 800-885-TVTN- Office 732-653-0263. Fax lmccain@telvue.com 16000 Horizon Way, Suite 500, Mt Laurel, NJ 08054 WWW.Mn.tv www.DrincetonserveraroUD.com 1 Monthly fee consists of Capital related Software & Hardware Upgrades (55%) and Expense related Support costs (45%) 2 Set up fee consists of Capital related Equipment & Installation (67%) and Expense related Sales & Production (33%) 3 $467.50x 60 Months = $28,050.00 + $8,040.00 Set up + $12,203.00 Equipment cost = $48,293.00 -Total EiVTN... ~-- " -- " r ~,,\ Princeton Server Group ATI'ACHMENT 2 July 12, 2007 Frank Iriarte City ofTukwila 6200 Southcenter Boulevard Tukwila, Washington 98188 Attn: Frank Iriarte Summary Cost ( Quote # 2) Expiration 90days Summary IMonthly Fee (includes upgrades) 2 One time Set up Fee Terms - 60 Months $ 500.00 $12,000.00 Cable Company - Fee Breakdown (Cable Company pays Capital cost) Note: Based on TVTN's accounting department analysis the following can be used as Capital Cost ICapital portion of Monthly Fee 2Capital portion of Set up Fee 3Total Cable Company Cost (Capital-one time fee) $ 275.00 $ 8,040.00 $24,540.00 Municipality - Fee Breakdown (City pays Expense cost) IExpense portion of Monthly Fee 2Expense portion of Set up Fee Total Municipality cost over 60 Month Term $ 225.00 $ 3,960.00 $17,460.00 Total Municipality cost Amortized over 60 Month Term $ 291.00 (per month) Kind regards, ,~1'to A>CL Larry McCain fii,TNO< f?:':~,\ - P.!ll<..-.~;on Server Group Divisions of Telvue Corporation 732-213-4730 - Mobile 800-885-TVTN- Office 732-653-0263 - Fax lmccain{@telvue.com 16000 Horizon Way. Suite 500. Ml Laurel. NJ 08054 www.Mn.tv www.DrincetonserverarouD.com I Monthly fee consists of Capital related Software & Hardware Upgrades (55%) and Expense related Support costs (45%) 2 Set up fee consists of Capital related Equipment & Installation (67%) and Expense related Sales & Production (33%) 3 $275.00x 60 Months = $16,500.00 + $8,040.00 Set up Fee = $24,540.00 -Total t . VTN'"' r;::~~~,\ Princeton Server Group A'ITACHMENT 3 July 12,2007 Frank Iriarte City of Tukwila 6200 Southcenter Boulevard Tukwila, Washington 98188 Attn: Frank Iriarte Summary Cost (Quote # 3) Expiration 90days Summary IMonthly Fee (includes upgrades) 2 One time Set up Fee Equipment Cost Terms - 60 Months $ 150.00 $ 2,950.00 $ 5,048.00 Cable Company - Fee Breakdown (Cable Company pays Capital cost) Note: Based on TVTN's accounting department analysis the following can be used as Capital Cost lCapital portion of Monthly Fee 2Capital portion of Set up Fee Equipment Cost $ 82.50 $ 1,976.50 $ 5,048.00 3Total Cable Company Cost (Capital-one time fee) $11,974.50 Municipality - Fee Breakdown (City pays Expense cost) lExpense portion of Monthly Fee 2Expense portion of Set up Fee Total Municipality cost over 60 Month Term $ 67.50 $ 973.50 $ 5,023.50 Total Municipality cost Amortized over 60 Month Term $ 83.73 (per month) Kind regards, ,j"C) ~,c~ Larry McCain U-:-VTN- CC:1!itoroup Divisions of Telvue Corporation 732-213-4730 - Mobile 800-885-TVTN- Office 732-653-0263 - Fax Imccain@telvue.com 16000 Horizon Way, Suite 500. Ml Laurel, NJ 08054 www.Mn.tv www.or!ncetonserverarouo.com 1 Monthly fee consists of Capital related Software & Hardware Upgrades (55%) and Expense related Support costs (45%) 2 Set up fee consists of Capital related Equipment & Installation (67%) and Expense related Sales & Production (33%) 3 $82.50x 60 Months = $4,950.00 + $1,976.50 Set up Fee + $5,048.00 Equipment cost = $11,974.50 -Total UVTNsm TelVue Virtual ATI'ACHMENT 4 Television Netvvoiks SPONSORSHIP GUIDELlNE_S Overview: TVTN provides a service to it's access channel affiliates in which it provides the automated access channel and content at reduced charges or no charge by locating third party businesses and organizations to underwrite the TVTN costs. In return an on-air acknowledgement of their efforts that are run on the channel. (Visual and audio announcements of about 15 seconds) Payments are made directly to TVTN at the fair market value of the services provided to the access channel operator (Municipality, school or other). Conditions of sponsorship Cable operators, in most cases, will concur with third party sponsorship of channels along with acknowledgements, provided the cable company considers the announcements non- commercial. Municipalities will accept sponsorship of their channels if they meet standards and practices of the community. Therefore TVTN tries to satisfy both groups by locating third parties which meet community standards and satisfy the cable company's non-commercial nature of the channel (though the cable company rarely spells out what that means) In order to meet these requirements TVTN has set out guidelines that are similar to those followed by non-commercial broadcast stations (which are still regulated by the FCC). We call the guidelines the "PBS (Public Broadcasting System) guidelines" which are summarized and quoted herein. Sponsorship Acknowledgment Guidelines (PBS): Permissible: 1. Up to : 15 seconds of acknowledgement 2. Name of product(s) and/or service(s) 3. Company location 4. Number of years in business 5. E-mail address or website (preferably visually depicted) 6. Telephone number 7. Non-promotional, value-neutral descriptions of products or services 8. Use of well-known mottos or slogans 9. Signature music or appropriate sound effects as a means of enhancing visual and voice-over 10. Use of well-known mottos or slogans that are non-promotional in nature 8/2005 Versior. 2 16000 Horizon Way, Suite 500, Mt. Laurel, NJ 08054 Tel -1.800.885.TVTN ( 8886) Fax -1.856.866.7411 www.Mn.tv 11. Signature music or appropriate sound effects as a means of enhancing visual and voice-over that are non-promotional in nature Non-Permissible: 1. Overt promotion of products or services 2. Price reference 3. Call to action or inducement to buy 4. Comparative or qualitative descriptions of products or services 5. Third-party reviews (from newspapers, magazines, etc.) Standards and Practices Most channels will not accept sponsorships from the following: 1. Liquor stores or bars or other establishments whose primary business is the sale of alcohol. (Restaurants that serve alcohol excluded, provided alcohol is not mentioned in the acknowledgement) 2. Any manufacturer or distributor of beer, alcohol or tobacco. 3. Any entity that promotes the use or sale of illegal drugs or drug paraphernalia. 4. Adult bookstores, adult movie houses and video dealers or strip clubs or any entity that provides adult oriented content or products by mail-order or through the internet 5. Political parties, lobbying groups, political action committees or cause based organizations. 6. Any illegal or off shore gambling entity or entity that provides information that enables or can be associated with illegal gambling. 7. Manufacturers or sellers of firearms, ammunition, gun repairs, accessories, targets, stun guns, tear or pepper gas dispensers, and rifle and pistol ranges. Retailers who sell other products not firearm related can be sponsors provided they do not promote firearm related products (for example, department stores and sporting goods stores) 8/2005 Version 2 16000 Horizon Way, Suite 500, Mt. Laurel, NJ 08054 Tel - 1.800.885.NTN ( 8886) Fax - 1.856.866.7411 www.Mn.tv WTN'. TelVue Virtual Television Net,..,crks TVTN SPONSORSHIP PROGRAM 4 . Established to assist conL111U11ities with the means to undelwrit~ the TV1N costs associated v.rith the Access ChanneL ~ I'\. rilenlber of our Sponsorship Team is assigned to rnanage the Presentation, Sale and Coordination to secure your sponsorship, ~ Support to solicit ongoing Sponsorship for the TVTN service and its associated fees are provided for the duration of OEl' contract. . You assist in detemlining who are appropriate candidates for Sponsorship of your Channf1 Y . . , 1 1 1 ~ TC''"'''"'O I @ ou provl.de oversIgnt, contTO, ano. V.1:" J. . pOVlef over ;;rte '':P(vn I;;;()r'- _' _. L_".. . ;').. S h' , J . ' 1 Fr--r, .' 1 l' <<. '. ponsors~ lp spots are ILl aCCO.fOance Wlt 1 -1\_,,-..1 5"UlC elme:; on H'PBS n un dervlliti!l~~. ,. 16000 Horizon 'ijillk~~ 500, Mt. Laurel, NJ 08054 Tel -1.800.885.1V1N (8886) Fax-1.856.866.7411 www.tvtn.tv v 1,-866-Har kIL!a AA/ iP866- 4 F7- 55 ,3 P,,„.. v.., ,i, cwww.harIclawnj.comvk%i.. 08/31/05 12:11 pm Crossroads Realty 2002 'Route 70 suile I Manchester. 08759 732-657-1300 Sponsor Screens I 4. SpqnS01' \I" Nutley Pet Emporium J 11....a.11111111111111111111111 :02 pu Pizzeria Ege_ Restait ntitt 414 Broad Street B loomfiel d IV 07003 (973) 748-088 NEXTEL 400 Broad St. Bloomfield, NJ 973-680-8193 NEXTEL.Done. W3 5" Bloomfield Sponsor 08/31/05 12:00 pm Ett `■1 sponso, 564 Un ion Ave F3ellevi I le NJ 07109 GR EY LOCK CH I ROPR ACT IC CENTER 973-759-3020 \NBHS 03,31/05 12:05 pm ATTACHMENT 5 Resolution No. A.. RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TUKWILA, WASHINGTON, WAIVING THE BIDDING REQUIREMENTS Ai'JD AUTHORIZING THE PURCHASE OF CITY CHANNEL EQUIPMENT AND SERVICES FROM TEL VUE VIRTUAL TELEVISION NETWORKS. WHEREAS, the City of Tukwila has determined a need to enhance communications to residents, businesses, and visitors and WHEREAS, the City of Tukwila has negotiated with Comcast to pay for the capital cost and pass the cost through to subscribers; and WHEREAS, other vendors have been contacted but do not provide a robust, integrated, managed system; and WHEREAS, the cablecast equipment and service from TelVue Virtual Television Networks (TV1N) provides the best state-of-the-art digital system, technical support structure, system flexibility, management services, and proven experience; and NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF TUKWILA, WASHINGTON, HEREBY REOL YES AS FOLLOWS: Section 1. The bidding requirement for the purchase of the City Channel equipment and services is hereby waived. Section 2. The Public Works Department is authorized to purchase equipment and services from TVTN. PASSED BY THE CITY COUNCIL OF THE CITY OF TUKWILA, WASHINGTON, at a Regular Meeting thereof this day of 2007. ATTEST/AUTHENTICATED: Verna Griffm, Council President Jane E. Cantu, CMC, City Clerk APPROVED AS TO FORM BY: Filed with the City Clerk: Passed by the City Council: Resolution Number: Office of the City Attorney