Consideration and Ratification of Uniform Video Service License Agreement:  Ratify the nonexclusive Uniform Video Service License Agreement with ALLO Arizona, LLC to provide video service within the corporate boundaries of the City of Flagstaff.
 

On June 4, 2019, the Flagstaff City Council passed and adopted Resolution No. 2019-22 approving a Model Uniform Video Service License agreement in response to a change in Arizona Revised Statutes.  On August 7, 2023, ALLO Arizona, LLC submitted an application for Uniform Video Service License pursuant to Title 9, Chapter 13, Arizona Revised Statutes.  Under the authority delegated to the City Engineer in Resolution No. 2019-22, and upon review by the City Grants and Contracts Section, as well as the City Attorney's Office, the City Engineer executed the License on March 3, 2024.  This agenda item is being brought before Council for ratification in accordance with Resolution No. 2019-22.

ALLO plans to begin construction of its network facilities within City of Flagstaff right-of-way in 2025 with a phased roll-out of service to customers as the installation progresses.  This is the first uniform video service license issued by the City of Flagstaff.  Optimum (formerly Suddenlink) continues to operate as an incumbent cable operator under an existing license with a ten year term issued September 22, 2017.

The fee associated with the license is five percent (5%) of gross revenues.  This fee is similar to the five percent (5%) of gross revenues on cable services paid by Optimum under its separate license as an incumbent cable operator.  The overall revenue impact of this license when combined with the revenue impact to the existing Optimum license will depend on the degree to which ALLO expands overall service subscribership in the Flagstaff area and the degree to which video service competition affects overall gross revenues of both operators.  During the initial build-out phase of the network, Development Engineering and Inspections will experience significantly increased workload for processing of permits and inspection of work within City of Flagstaff right-of-way but anticipate issuing permits at a rate as to not overwhelm staff's ability to manage and inspect the work within the right-of-way.

The addition of a second video service provider will provide the public with additional video service choices, potential connectivity improvements, as well as resiliency through modernization of video service infrastructure.  In addition ALLO intends to offer internet service.

The Model Uniform Video Service License Agreement was considered and adopted by Flagstaff City Council on June 4, 2019 in response to a then-recent state law which required that Cities adopt such license agreement prior to July 1, 2019.  The Staff Report as well as Resolution No. 2019-22 are attached.

1. Ratify the Model Uniform Video Service License Agreement with ALLO Arizona, LLC dated March 5, 2024. (recommended)
2. Do not ratify the agreement.  (not recommended as this standard agreement has been adopted by previous City Council in response to state law)

• Sustainable and Innovative Infrastructure
• Robust and Resilient Economy

• ED.3.9  Develop infrastructure so that the community has acces to high-speed internet and telecommunications.

• HS-4 Improve the resilience of public infrastructure and City facilities

• None