Homeowners who are forced into cable TV-Internet deals aren't happy 

Article Courtesy of The St. Petersburg Times

By Bill Coats

Published August 18, 2008

NEW TAMPA — In 2003 a developer, a homeowner association and a cable TV company made a deal that was a portrait of efficiency:

A new development, and every house in it, would be wired from the get-go for cable and Internet service. Fees would be collected in bulk through everyone's home­owner dues. The cable company, blessed with those shortcuts and years of guaranteed money, would keep its prices competitive.

But that deal — and others like it across Florida — are fueling a consumer controversy today that stretches from here to Washington, D.C.

The deal actually was an insider arrangement front to back. The same trio of brothers controlled the developer, the homeowner association and the cable company.

They locked the future home­owners in the development, Live Oak Preserve, into at least 10 years of payments to the family-owned cable service, Century Communications.

Some of those homeowners preferred Verizon, or satellite hookups. So they paid for those, plus Century. Some never used the Internet. But they still paid Century. Some abandoned their houses to foreclosure. The home­owner association remained on the hook for their fees.

The setup is perfectly legal, and far from unique. Ballantrae, in Land O'Lakes, is harnessed into a 10-year contract, binding on all 969 homes. Fifteen thousand homeowners in Weston, west of Fort Lauderdale, inherited a perpetual contract from their developer. A lawsuit rolled it back to 2013.

But now, something bigger than a mere court case threatens such deals. The Federal Communications Commission is considering blocking them outright.

The first strike was a ban issued in October on deals that give a single cable provider exclusive access to a community. The cable industry has sued to overturn that.

Simultaneously, the FCC invited the nation to comment on whether "bulk billing" deals like those in Live Oak and Ballantrae should be outlawed too.

By last week, 751 responses had poured in; 218 came from Live Oak.

'Utter crawl'

Zuriel Cabrera, 30, lives on his laptop. He has used it to inspire what may be the majority of Florida's correspondence to the FCC over bulk billing.

"I don't know when he sleeps," said John Carter, an ally of Cabrera's in Live Oak.

Cabrera moved to Live Oak three years ago from New Jersey. The day before he closed on his home, he learned that home­owner fees included cable service.

His connection fee was $200. That had been free in New Jersey. Many of Cabrera's favorites — the National Geographic Channel, the Science Channel, Latin programming — were missing.

The system conked off during thunderstorms. The Internet hookup was slow.

"At peak times, it was an utter crawl," said Cabrera, a computer systems consultant.

Soon, he became homeowners president in Live Oak's Weatherwood Village, with 124 homes. He created a boisterous Web site, liveoakforums.com.

Via the new forum, residents organized an afternoon of picketing in October against their developer and Century. Signs included: "Homeowners Fed-Up; Poor Cable & Internet Service," and "Century Communications; WE WANT U OUT."

Ten days later, the FCC lit a fuse on the bulk-billing debate. "That's when it just blew up," Cabrera said.

So he built another Web site, BanBulkBilling.com. That connected Cabrera with more activists, including Marilyn Castro, 39, of Virginia Beach, Va.

Castro's homeowner association inherited a 75-year contract with Cox Communications, now at $145 per month, per homeowner.

"They're trying to say it's a deal," Castro complained. "A deal for whom?"

On June 18, Castro, Cabrera and several other protesters against bulk billing met in Washington with FCC staffers.

"They were very good," said John Norton, an executive in the FCC's media section, who met with the group for more than an hour. "They carried their message forward more than competently."

Choice or discount?

The FCC's formal comment period on bulk billing has expired, but late comments are being accepted, said Norton. The issue isn't on the agenda of the FCC's next meeting, on Aug. 28, but could come up later, he said.

Norton said the FCC essentially will decide whether consumers are better off choosing their own communications service or reaping the discounts that bulk billing often generates.

At Ballantrae, homeowner president Richard Solkin is skeptical about that. He said the development's contract with Bright House Networks is for $27 a month per house.

"If you call around to other developments, you'll see they're paying 18, 19 dollars," Solkin said.

Live Oak's price, which combines cable TV and Internet, is for $85 a month.

Its contract with Century didn't promise a discount. It allows for a 5 percent increase each year, limited by a pledge "not to increase the monthly service fee above that charged by a majority of other similar companies providing similar services in the county," as determined by Century.

In most respects, Live Oak is now free of the three Boca Raton brothers — Arthur, Robert and Edward Falcone. The Falcone Group sold Live Oak's developer, Transeastern Homes, in 2005. Century, another Falcone subsidiary, sold its service contract for Live Oak earlier this summer to Bright House.

Residents say the TV package is better now, the Internet connection faster.

But their stream of complaints prompted Bright House representatives to visit the FCC last month. They told FCC staffers that Live Oak's $85 fee is a 37 percent discount off Bright House's retail price. Without bulk billing, most of those customers would experience "a significant increase in rates," Bright House argues.

John Carter acknowledges the improvements. But the retired math teacher remains irked at the contract terms. Carter alone accounts for 53 of the e-mails from Live Oak to the FCC, as of last week.

"You must take the service, and you must pay for it," he complained. "All those homes, whether they're empty or not, must pay.

"That's the one deal I can't accept."

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