IS PAYING $128,000 TO THE HUDSON CABLE TV STATION MANAGER WORTH IT?

S. David Worhatch Published:

Your December 16 report on the remarks I made to City Council concerning the future of Hudson Cable Television failed to capture accurately the object or purpose for raising the issue with council members in the first place. I see that in the 18 years since I last served as a Hudson council member myself, your newspaper plainly has gotten no better at reporting the facts!

The 2013 city budget projects that it will cost taxpayers $315,541 to run Hudson Cable Television next year. That's $35,541 MORE than what the city plans to take in on franchise fees paid by cable television subscribers. So it's fair for taxpayers to ask what the city will be getting for $864.50 a day each and every day next year and whether that's worth running in the red when there are so many other basic needs that go unaddressed in a budget featuring a $1.12 million DEFICIT.

I do NOT advocate that our city take steps to fold our local cable television channel back into the Cable 9 consortium of neighboring local governments that collectively run their local access cable television station out of a station located in Macedonia. (Hudson left that consortium in the mid-90s for the purpose of establishing a stand-alone public access station dedicated to Hudson and its environs.) As my report to City Council on December 11 indicated (a full copy of which is reproduced below), all I suggested was that STUDYING possible repatriation with Cable 9 would be a vehicle for focusing the attention of local officials on the future of the Hudson cable television station and either reconfirm or revisit the question of whether operating a dedicated Hudson-only station is a luxury we can reasonably afford in light of other demands on the city's finite resources. Besides, possible repatriation with Cable 9 would offer a chance to test the Mayor's ideas on capitalizing on opportunities to engage in a bit of regional cooperation where the interests of neighboring political subdivisions might coalesce.

I advocate a STUDY of the future of our local access cable operation in the context of a changing landscape and dwindling numbers of subscribing households in the area, particularly given that city officials themselves are projecting budget deficits for our dedicated station. I am on the record as NOT advocating the immediate wind-down of Hudson Cable Television or any pre-ordained plan for merging our operation with Cable 9 any time soon. But I do advocate an IMPARTIAL review of the future of the station and the budget impact of continuing to operate it as we currently are.

Part of such a review, of course, should include a close look at the compensation and benefits of our city's Station Manager. He earns, with benefits, over $128,000 a year to manage a staff of himself, four part-timers, and some seasonal workers. By contrast, the Executive Director of Cable 9, a 31-year veteran of local access television in Northeast Ohio, earns $88,000 a year, with benefits, and manages a staff of five full-timers and seasonal workers in delivering local access programming for seven (7) neighboring local governments and a subscribing household base 2.25 times LARGER than Hudson's. That means the Station Manager in Hudson earns 46% MORE than his peer manager to manage an operation that is much SMALLER than the Cable 9 operation.

Cable 9 NEVER operates with a deficit. The city's 2013 proposed budget, by contrast, projects that Hudson Cable Television will spend $35,000 more than it will take in with franchise fee revenues. At a time when City Council is trying to squeeze every dime out of the budget to meet increasing road maintenance and reconstruction needs, Hudson residents rightly should ask what is so special about Hudson Cable Television that operating IN THE RED in 2013 could be justified.

Slashing the Station Manager's salary to equal that of the Executive Director of Cable 9 would save more than enough to make up that deficit ... an idea whose time may have come!

To make sure there is no confusion in the public’s mind caused by your newspaper’s inaccurate December 16 account of my remarks to City Council on the future of Hudson Cable Television, I include at the end of this op-ed article the full text of my revised and extended remarks. Ironically, my remarks to City Council, in their entirety, can be viewed on the Hudson Cable Television website, at http://www.hudson.oh.us/index.aspx?NID=116 (follow the links from the City Council Workshops page).

Council members rightly focus on the value of operating a dedicated local public access station here. I share those views. But ... what no council member can avoid is the fact that we are operating Hudson Cable Television at a DEFICIT at a time when the city’s resources need to be leveraged to meet more pressing needs … and we are paying the Station Manager 146% of what a more experienced station manager in a neighboring community is paid to service a market 2.25 times LARGER than Hudson.

City Council must make tough choices, both large and small, TODAY to avoid even more costs to the city if current needs are deferred to the future. Hudson Cable Television’s budget is one of the areas that, in my view, is the sort of “low-hanging fruit” that Councilman Hal DeSaussure said at the November 14 workshop that the city must start begin to harvest in order to erase a projected $1.12 million DEFICIT for 2013.

S. David Worhatch

Hudson, Ohio

Former Member of City Council

Former Chair, Cable 9 Television Consortium

TEXT OF MY DECEMBER 11 REMARKS TO CITY COUNCIL (as revised and extended as part of the December 19 meeting of City Council):

A Primer on Public Access and Government Access Cable Television in Our Area

Cable 9, the consortium of seven incorporated and unincorporated local governments that facilitates or provides public access and government institutional programming for the Cities of Twinsburg, Macedonia, and Aurora, the Village of Reminderville, and the Townships of Sagamore Hills, Northfield Center, and Twinsburg, serves about 18,500 households that subscribe to Time Warner on total budgeted franchise fee revenues of $896,000. Cable 9 has a staff of five full-time employees ranging from an Executive Director with 31 years of public access television experience to three other production staffers with 26, 26, and 21 years of public access programming experience respectively, and an administrative support staffer. Seasonal workers round out the Cable 9 crew.

Hudson Cable Television’s proposed budget for 2013 projects a full-time administrator, four part-time staffers, and seasonal workers. The budgeted franchise fee revenue for 2013 is $280,000, or about 31% of the Cable 9 budget, and is earmarked to service a community of approximately 5,600 subscribing households and the few non-subscribing households that choose to log on to the city’s website to view the local station’s programming on demand. (According to Page 46 of the city’s proposed budget for 2013, actual franchise fee revenues for 2012 are running $33,830 ahead of the projections reflected in the city’s proposed budget going forward. If the 2012 figures hold true for 2013, Hudson Cable Television is serving a community of approximately 6,275 subscribing households.)

With the changing climate in the delivery of television service to the home (Direct TV, Dish Network, AT&T, Hulu, online demand, etc.), it is safe to say that franchise fee revenues are likely to decline in the next several years as more and more households opt for services that compete with Time Warner.

Recent history bears this out. When Hudson pulled out of Cable 9, its total franchise fee revenue represented 30% of the total Cable 9 budget. If Hudson were part of Cable 9 again, therefore, today’s franchise fee revenues would constitute about 24% of the combined budget. Extrapolating from these figures, therefore, and adjusting for the inflationary effects on cable television service fees charged to subscribers over the years, it is fair to conclude that Hudson’s aggregate cable television franchise fee revenues, in real terms, have declined some 23% since Hudson and Cable 9 parted ways.

I used to be the Chairman of the Board of Trustees of the Cable 9 Consortium and I am a champion of public access and government institutional television programming. There are several advantages to offering such services dedicated exclusively to what is going on in Hudson. However, with the Mayor’s focus on trying to find ways to economize through regional cooperative arrangements that offer pathways to greater efficiency and the delivery of public services more economically, is it now time to rethink the concept of continuing to operate Hudson Cable Television as a stand-alone public access and government institutional programming station?

The Executive Director of Cable 9 currently earns, with benefits, about $88,000 a year. In the 2013 budget, it is proposed that the administrator of Hudson Cable Television be paid some $128,615, with benefits, or about 46% more than the Cable 9 Executive Director will make in managing a system that is over 2.25 times larger than the household base serviced by Hudson Cable Television based on the assumption included in Page 46 of the city’s proposed 2013 budget.

Cable 9 operates within its own budget and does not rely on any subsidies from any of its member communities. By contrast, Page 45 of the city’s proposed 2013 budget projects that Hudson Cable Television will spend $35,541 more than the $280,000 in franchise fees the Finance Director is expecting to receive.

I am NOT advocating that we close down Hudson Cable Television immediately or that we do it at all. I only suggest that we take a serious look at the propriety of continuing to offer this services as a stand-alone public access and government institutional programming provider. Is it a luxury we can afford to continue? Is seeking readmission to Cable 9 the sort of example of regional cooperation that the Mayor has advocated? A panel of disinterested persons should be appointed to consider the advantages and disadvantages of possible reintegration of our station into the Cable 9 family. They should solicit the current stakeholders of the local station for their views, but those stakeholders should not be allowed to frame the panel’s final report or recommendations.

There is no assurance that Cable 9 would even entertain the idea! However, the exercise of looking into the prospects of repatriation would be worthwhile. Any serious look into the future of local cable television programming in Hudson should include projections concerning the changing climate for the delivery of television service in the future, the expected effect on franchise fee revenues, the total operating costs associated with providing dedicated local service, and the advisability of continuing to compensate the administrator of Hudson Cable Television at 146% of the total compensation package afforded the Executive Director of a much larger local access provider.

And if Council determines after this review that we as a community should continue to invest in our own dedicated local access station, then Council members should make that decision in the context of the impact it will have on other demands on the taxpayer’s resources that simply will have to be deferred or ignored for the foreseeable future.

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