Appeals court hears Mediacom's franchise dispute

A closely watched franchising fight between Mediacom and the City of Prior Lake has gone before a three-judge Minnesota Court of Appeals which will decide whether, as Mediacom asserts in a suit, Prior Lake violated state law in the way it approved a franchise for competitive provider Integra Telecom.

The crux of the argument is that the city did not require Integra to provide cable TV service for the entire city as it did with a 1999 agreement with Mediacom. Integra needs only to cover 60 percent of the area. Mediacom also argues that the city's deal for collecting public, education and government (PEG) money from Integra, which is allowed to make a capital grant for PEG access programming over a 10-year period, is not as onerous as the one-year requirement the city levied on Mediacom.

Prior Lake's argument is that it followed FCC guidelines that suggest a little leniency because build-out requirements impose "significant financial hardships" on new market entrants. The court is expected to rule within 60 to 90 days.

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