$186,200 Fine Voted in Failure of United Cable to Meet Deadline

A Los Angeles city commission voted Friday to fine United Cable Television of Los Angeles $186,200 for failing to meet deadlines in the installation of a cable-TV system in the East San Fernando Valley.

In a compromise reached after splitting on the same question earlier this month, the Board of Telecommunications Commissioners voted unanimously Friday to assess United for its failure to have 270 miles of cable installed by Jan. 31.

Under the terms of United’s contract with the city, the cable company agreed to pay fines if it fails to complete designated segments of the system by set deadlines.

Two commissioners said they believe the fine is excessive, but agreed to it on condition that United be allowed to pay the fine with $86,200 in cash and $100,000 worth of equipment and services to be specified later. It was suggested that the firm could obtain the equipment and services at lower prices than the city, thus saving itself some money.

United’s president, William Cullen, said the company will appeal the decision, an action that will leave the final decision up to the City Council.

“I don’t think we should be fined,” Cullen said. “I don’t think we deserve it. We have made a commitment and tried to live with it. It is patently unfair and unjust to penalize United when we did everything in our power.”

Received Extensions

United originally was to complete installation of the 1,140-mile system last December. It received two 10-month extensions, pushing the completion date to July 31, 1987. On April 4, the commission granted a third extension to June 30, 1988.

Company officials said they expect to complete the system by April, 1988.

They said the company has installed 122 miles of cable and expects to be providing service to 2,500 homes in Pacoima, Mission Hills and Sylmar by the end of this month.

Cullen blamed United’s failure to meet previous deadlines on circumstances beyond the company’s control. He said the company had problems in obtaining Department of Water and Power approval to string cable on utility poles. He also said that financing for the project fell through at one point because of uncertainty over changes in the tax laws last year.

However, Commissioner Tracy Westen said that it would be impossible for the board to make exceptions simply because a firm tried to meet its commitments.

Commissioner Ira T. Distenfield said he hopes the decision would show all cable companies that the board will require them to live up to the promises they make.

At the April 4 meeting, with two commissioners absent, the board split 2 to 1 on whether to fine United for missing its deadline. Three votes were required for passage.

Compromise Proposed

On Friday, Department of Telecommunications General Manager Susan Herman proposed the compromise under which only $86,200 would would be paid in cash.

Herman suggested that the rest of the money could be earmarked for equipment purchases as part of a $500,000 project to build a production and broadcast facility in City Hall.

Under Herman’s plan, $65,000 would be used to construct an “interconnect” to carry City Hall programming to the cable subscribers. Another $35,000 would be used to buy production equipment, Herman said.

Commissioner Distenfield objected, however, saying that the plan would allow United to keep the remaining $100,000 until the city acquires the rest of the money for the project.

The commission settled upon a broader concept that would allow the money to be spent on unspecified equipment or services for the benefit of cable service.

Herman said her department will prepare a list of items for the commission to vote on in the next 60 days.

The board must still act on fines for the time since Jan. 31.