City's action could kill Time Warner Cable, Comcast merger in Lexington

The city is poised to deny the transfer of ownership of Time Warner Cable to Comcast, which would kill the merger in Lexington.

The council voted unanimously during a council work session Tuesday to put two resolutions denying transfer of ownership on the agenda for Thursday's council meeting.

The move came after the council met for more than an hour behind closed doors to discuss potential litigation.

Mayor Jim Gray said after Tuesday's meeting that the council's decision came after months of negotiations with Time Warner Cable, whose cable franchise agreement with the city expired in 2012. The city has been negotiating with the cable company on a permanent agreement since 2012. Gray said that during negotiations, the cable company would not address customer service complaints.

"We have worked aggressively and vigorously to negotiate these terms with Time Warner," Gray said. "They have just not been reasonable. We are looking for better customer service and they are not willing to offer it. That's why the council took the action that it did today."

Until changes are made that will help Lexington cable customers, Gray said, "They will not approve" the transfer of ownership.

The merger between Time Warner Cable and Comcast is being reviewed by the U.S. Federal Communications Commission and the U.S. Department of Justice.

"Time Warner Cable continues to work with the city of Lexington, and we hope to reach an agreement in the best interest of our customers," said Time Warner spokesman Mike Hogan.

The resolutions will be on for first reading at Thursday's Urban County Council meeting. A final vote on the resolutions could occur as soon as Oct. 23. The city has until Nov. 14 to approve or deny the transfer of ownership.

Vice Mayor Linda Gorton said the city held two public meetings and also asked for public input regarding issues with the city's cable provider.

The city received "reams" of negative feedback from citizens, she said "It's everything from equipment, to service, to cost or the inability to understand how costs are set."

Gorton and council members Harry Clarke and Julian Beard have served on the team negotiating with Time Warner Cable.

Some people said that customer service dramatically declined after Time Warner Cable took over Insight Communications in 2012.

Gorton said they started with the citizens' complaints during the negotiations this summer.

"We have been working several months on these negotiations," Gorton said. "We have made progress along the way. The government has made concessions and Time Warner has made concessions. We want to get the best service for our citizens that we can."

One resolution would deny transfer of Time Warner Cable to Comcast. The second resolution would deny transfer of Comcast to Charter, the company Comcast and Time Warner Cable will eventually become.

"We hope that Time Warner Cable will take note," Gorton said.

Gorton said the city could put the franchise agreement up for bid but that would be difficult to do because Time Warner Cable owns all of the cable infrastructure.

But if the city ultimately denies the transfer of ownership, it's likely that the matter will have to be settled in federal court, Gorton said.

This story was originally published October 7, 2014 at 7:13 PM with the headline "City's action could kill Time Warner Cable, Comcast merger in Lexington."