Delayed financial audit holds up contract dispute between Comcast and RETN (6/18/09)

June 18, 2009

By Tim Simard

Observer staff

Officials at the Regional Educational Technology Network are wondering when a promised audit of their finances will be released, after cable provider Comcast stated a report would be completed by May.

RETN provides educational coverage of local school districts, including Williston. Comcast hosts RETN on channel 16.

As part of a contract dispute between the two parties, Comcast was due to issue an auditor’s report detailing RETN’s assets last month. RETN Executive Director Scott Campitelli said he does not know why the report is late and the delay is leaving the small cable access organization “in limbo.”

“We only know that it’s obviously taking longer than (Comcast) expected,” Campitelli said.

Campitelli also said the process is becoming more expensive as it drags on, with increased lawyer fees and other costs.

RETN released a statement last week outlining the steps it has taken to work with Comcast. Campitelli said that now it’s time for Comcast to hold up its end of the deal.

“I’m not surprised Comcast failed to deliver its report as promised,” Campitelli said in the statement. “It’s consistent with their behavior throughout these negotiations. Apparently Comcast believes RETN should be held to a higher standard than it is capable of meeting itself.”

Since November 2007, RETN has been in a contract dispute with Comcast, the nation’s largest cable company. Per federal law, Comcast uses cable subscriber fees to fund local access programming, including RETN.

Comcast has argued that RETN’s finances were not up to spec and told the Vermont Public Service Board it would not renew its contract with RETN South, which covers educational events for Charlotte, Ferrisburgh, Hinesburg, Shelburne and Vergennes.

RETN North’s contract does not expire until 2011, although Comcast has petitioned the Public Service Board to suspend that contract. RETN North broadcasts in Burlington, Essex, Essex Junction, St. George, South Burlington, Williston and Winooski.

In February, both sides met before the Public Service Board in a preliminary hearing. At that time, RETN stated it had made some changes Comcast had requested in terms of its finances and purchases. RETN declined to make other changes, claiming they would usurp the authority of the organization’s governing board, Campitelli said. The board is made up of representatives from the communities RETN serves.

To keep RETN functioning during contract negotiations, both sides agreed to an interim funding deal. Comcast also stated it would audit RETN and have a report available by mid-May. It was expected that both sides would meet again before the Public Service Board this month for a status conference. But Campitelli said it might be July before both parties meet.

Kristen Roberts, a public relations spokesperson for Comcast, said an independent auditor is in the midst of finalizing the report. She said the process has taken longer than expected due to scheduling conflicts between the auditor, Comcast and RETN. Roberts also said the auditor did not receive all the information it requested from RETN until early May.

“We look forward to reviewing the report and expect to provide the findings to the Public Service Board and RETN within the next several weeks,” Roberts said in an e-mail to the Observer.

When the report is released, Campitelli expects it to reflect well on RETN’s finances and the changes it has made in the past 18 months.

“We know our financial integrity is intact,” Campitelli said. “Knowing how we operate, we know there will be no problems.”

During the audit process, RETN hired its own independent certified personal accountant to help prepare documents for Comcast. The CPA did not find anything out of the ordinary, Campitelli said.

Campitelli also said RETN plans to file a counter petition with the Public Service Board in the coming weeks. He said Comcast’s demands for stringent oversight go beyond what RETN’s board believes is fair and take away the organization’s ties to the community.

Meanwhile, the national organization Alliance for Community Media recently awarded RETN its “Overall Excellence in Educational Access” award. RETN won in the cable access category for organizations with annual budgets between $200,001 and $499,999. Officials from RETN will receive the award next month.