District Cablevision Inc., the firm awarded the contract to bring cable television to the District, has filed a complaint with the D.C. Public Service Commission saying that the Chesapeake & Potomac Telephone Co. wants to charge "unjust and unreasonable" rates for use of its telephone lines and conduits.
C&P has agreed to build, own and maintain the lines used by the cable system, whose construction is scheduled to begin next spring. A contract between District Cablevision and C&P provided that the rates charged for use of the lines would be negotiated, according to Richard Maulsby, director of the D.C. office of cable television.
Maulsby said the dispute between the two companies was "no big deal" and that differences over the fees will be resolved by the Public Service Commission, which is holding a public hearing on the matter Feb. 13.
However, Maulsby acknowledged that if C&P gets what it is asking from the cable firm, it "would have an adverse effect on what District Cablevision has to charge its subscribers."
Last summer, the D.C. City Council voted to grant District Cablevision millions of dollars worth of concessions in the franchise agreement after company officials argued that the terms of its agreement with the city hampered the firm's ability to obtain the necessary financing. The concessions were contingent upon District Cablevision submitting a citywide construction schedule to the city and reaching agreement with C&P on the cost of building the system.
In the complaint filed with the Public Service Commission, which regulates local utility rates, District Cablevision asserted that C&P's annual flat rate of $6,600 per mile of conduit -- the same rate the phone company charges other users -- is more than three times as high than it should be.
District Cablevision said that an annual rental rate of no more than $2,011 a mile "would adequately compensate C&P for its costs of providing conduit space for cable television use" and would minimize the cost of providing cable TV service in the city, according to a notice published by the commission.
Robert L. Johnson, president of District Cablevision, declined to comment on the matter. C&P officials could not be reached late yesterday.
"The reason they could not negotiate among themselves was that it was C&P's position that they had to charge the cable operator the same amount they would charge anyone else," Maulsby said.
He added, however, that because the cable company had a contract with C&P providing that the telephone company would build and own the cable lines, the cable firm believed it should enjoy lower rates for the use of the lines.
"They [C&P] are making a nice profit on the deal already," Maulsby said. "That is a factor that has to come into play here and that is why there has to be a third party to resolve it."
Under the timetable, construction is to begin this year throughout the city, except in Ward 2, the center city area, and in Ward 3, west of Rock Creek Park, where underground construction will be required. The system is scheduled to be completed by 1990.