VALDOSTA — A number of Mediacom customers recently experienced a cable rate increase of $4.26, and will experience another rate increase of $4.16 Nov. 1, which has stirred some confusion.

City Manager Larry Hanson said, “The city of Valdosta is significantly limited in its ability to regulate these rates under FCC regulations. The city was able to negotiate an agreement with Mediacom in 2004 that required rate equity for Valdosta customers to ensure that they paid the same or less than other Mediacom markets in the area. City staff continues to review the rate cards from these other markets to insure compliance and has recently requested Mediacom send verification that all other provisions of the Forbearance Agreement are being met. The agreement made in 2004, based on a study, allows us to get the benefit of competition without having to build our own system.”

Basically, the agreement between the city of Valdosta and Mediacom states that Mediacom will provide service at a cost equal to or less than services of the surrounding competitive communities such as Thomasville, Tifton, Moultrie, Cairo and others. “Customers are only guaranteed to be paying no more than the surrounding areas. We have the rate cards to prove that the rates are equal to or less than the rates of cable competition,” according to Hanson.

“The customers who are receiving raised rates are customers that have not received incremental rate increases,” said Mediacom’s Director of Area Operations for the Valdosta area, Sally Bloom. “Their rate is about $8 less than the stated family cable rate of $49.95, within the city of Valdosta. These rates are the same as surrounding cities and in accordance with the Forbearance Agreement between Mediacom and the city of Valdosta. The Mediacom agreement with the city runs concurrent with the franchise agreement that expires in 2012.”

Under the Telecommunications Act of 1996, the cable industry is regulated by the Federal Communication Commission. Accordingly, cities only grant franchises for cable companies to do business within a city.

Bloom said that letters have been sent out to prepare the Mediacom community for the rate increases. “Separate from the customers’ bills, a Class A letter was issued to customers informing them of the change,” said Bloom.

Hanson said, “The city has expressed concern to Mediacom that their letter of Feb. 19, 2008, to approximately 2,600 customers was misleading and inaccurate. The letter was extremely vague as to what exactly was the billing oversight. We do not believe the rate was inaccurate, and it should not be presented to customers as such. If Mediacom wishes to raise rates, which they have the right to do, they should just say that and not confuse customers. Mediacom has assured the city that senior citizen discounts will not be taken away as stated in the letter ‘the senior citizen discount code will continue in effect, at least until the franchise/Forbearance Agreement expires in 2012.’ Senior citizens should check their bills and call Mediacom if the 10 percent discount is not included.”

With cities having very little authority to regulate cable rates, as cable is regulated by the FCC, Valdosta’s local government has researched various avenues for accommodating its citizens.

Based on a feasibility study for the city’s provision of cable, the capital investment would have cost the city an estimated $32 million to provide a package including telephone and Internet usage.

“Rather than making an investment of that magnitude, we chose to make an agreement to provide service equal to or less than services where competition exists,” said Hanson. “In recent months, mayor and council have approved a statewide franchise agreement to allow AT&T to provide cable service in Valdosta. However, it is up to AT&T if and when to provide service to Valdosta.”

While many citizens have been concerned, calling Mediacom’s service a “monopoly” within the city, rates for competing cable companies varies. According to customer representatives of the various companies, Charter Communications offers basic cable with local stations at $16.99 with an annual rate change that varies according to the area in Valdosta and Dish Network offers a package of 100 basic channels, including local channels if available, for $49.99 with a $5 annual increase.