From: Leonhardt, Ronald Sent: Wednesday, March 21, 2007 3:11 PM To: Council Members _Aides Cc: Morics, Wally; Daun, Michael; Michalski, James; Moschella, Vincent; Langley, Grant; 'Nicholas Miller'; MacDonald, Terry Subject: Comptroller's letter on AT&T agreement The Comptroller has submitted a letter to the Common Council regarding concerns about the auditing and financial reporting provisions in the proposed agreement with AT&T that is the subject of a special Steering and Rules Committee meeting tomorrow at 1:30 p.m. A copy of the Comptroller's letter has been forwarded to all Council members by email from Terry MacDonald. Below are comments from Atty. Nicholas Miller, the city's legal expert on telecommunications matters, who will be present to address the agreement tomorrow before the committee. His comments address the Comptroller's concerns. We need to keep in mind that this agreement with AT&T is not a cable television franchise nor is it a contract by which the city is purchasing services from a vendor. At this point in time AT&T has voluntarily agreed to enter into this agreement with the City of Milwaukee and to be bound by many of the same provisions that apply to our cable television franchise with Time Warner. The thrust of our negotiations was to get the agreement as close as possible to our Time Warner franchise. The question of whether their U-verse product is cable television is the subject of the lawsuit that the city has filed. The agreement specifically provides that if a court finds that U-verse is cable, AT&T will then be bound by the provisions of Chapter 99, which would include the detailed quarterly reporting requirements that the Comptroller seeks. Ronald D. Leonhardt, City Clerk City of Milwaukee 200 E. Wells St., Room 205 Milwaukee, WI 53202 Phone: 414-286-2221 Fax: 414-286-3456 -------------------------------------------------------------------------------- From: Nicholas Miller [mailto:nmiller@millervaneaton.com] Sent: Wednesday, March 21, 2007 12:57 PM To: Leonhardt, Ronald; Langley, Grant Cc: Moschella, Vincent; Murphy, Michael; Daun, Michael; Michalski, James; Morics, Wally Subject: RE: AT&T agreement/right to inspect records I agree with Ron—the combination of the “standby” authority of the city to review the documents, and the right to do an audit at the end of 3 years was an explicit compromise with at&t. The company maintains the city has no right to charge anything for U-Verse, because it is not a “cable service”, but is an “information service” authorized to be carried over the existing at&t network without further City authority. The agreement to pay 7% of gross revenue for the 3year interim is a substantial victory for the City. Asking the company to expose itself to multiple audits by multiple communities (the RTC is likely to duplicate the City’s agreement) will change the willingness of the company to proceed with several other provisions in the bill. The City has adequate authority and rights to audit to assure itself that it is getting 100% of the revenues it is due. Let me know if you need more. Nicholas P. Miller nmiller@millervaneaton.com Miller & Van Eaton, PLLC Suite 1000 1155 Connecticut Ave., N.W. Washington, D.C. 20036 (202) 785-0600 (202) 785-1234 (fax) www.millervaneaton.com This message is intended only for the use of the individual or entity to which it is addressed, and may contain information that is privileged, confidential and exempt from disclosure under applicable law. If you have received this communication in error, please delete it and destroy any copies, do not distribute it, and notify us immediately by email: nmiller@millervaneaton.com or via telephone: (202) 785 0600. -------------------------------------------------------------------------------- From: Leonhardt, Ronald [mailto:RLEONH@milwaukee.gov] Sent: Wednesday, March 21, 2007 12:49 PM To: Morics, Wally; Daun, Michael; Michalski, James Cc: Langley, Grant (MilwaukeeWI); Moschella, Vincent (MilwaukeeWI); Murphy, Michael Subject: AT&T agreement/right to inspect records Even though the specific language that Jim Michalski suggested for reporting to accompany the quarterly payments from AT&T was not included in the final agreement, please note that Section 8.1 provides as follows: AT&T Wisconsin shall maintain records as necessary to comply with the terms and conditions of this Agreement and applicable law and shall make such records available for review by the City upon request. Isn't this sufficient language? Ronald D. Leonhardt, City Clerk City of Milwaukee 200 E. Wells St., Room 205 Milwaukee, WI 53202 Phone: 414-286-2221 Fax: 414-286-3456