Metro Cable commissioners approve preliminary budgets, form ad hoc to set priorities as revenues fall

The Sacramento Metropolitan Cable Television Commission on June 13 approved preliminary FY2025–26 general fund and public education and government (PEG) fee budgets and agreed to form a budget-priorities ad hoc committee after the commission's executive director warned that franchise-fee revenue has declined and that the organization could face difficult choices in coming years.

Sean (executive director) told commissioners the top-line revenue trend is down while expenses are rising; to meet the preliminary FY2025'16 distribution he said the commission is "ringing cash out" and showed a projected per-capita distribution figure of $6,314,842 compared with an alternate calculation of $5,496,283 if cash is not drawn. He said the commission is holding roughly $1.5 million in operating reserves and recommended formation of a small ad hoc committee to set priorities for the next 12'0 months.

The warning came during a public hearing on the preliminary general fund budget. After public comments emphasizing the value of Metro 14 and community access, Vice Chair Garrett Gatewood moved to close the hearing and move the item; the motion was seconded and approved by voice vote. Commissioners later closed the separate PEG fund hearing and approved the PEG budget; the PEG decision included at least one recusal.

Why it matters: franchise-fee revenue is tied to traditional cable subscriptions and has fallen as more viewers use streaming services. That revenue decline directly funds Metro 14 operations, community programming grants and quarterly per-capita distributions to member jurisdictions; the commission must balance those priorities as reserves fall.

Key details from the staff presentation

- The executive director said franchise revenue (the 5% franchise fee) is declining because more viewers use streaming platforms and smart-TV apps; the commission does not collect fees on streaming subscriptions. - For PEG (the 1% fee that may be used only for capital costs), staff reported total PEG requests of $3,893,379 for FY2025'16, including $1,860,936 in re-requested multi-year projects. Staff forecast roughly $1.4 million in PEG revenue for next year, which would not cover all requests if all projects proceed. - Staff asked the commission to hold about $1.5 million as an operating encumbrance to preserve six months of operations while planning. - The executive director said the commission will begin financial auditing of program budgets starting with the commission's own books and then offering to review licensee records in coordination with those organizations.

Public comment emphasized community access and training

Public speakers, including longtime community-media volunteers and Access Sacramento staff, urged the commission to preserve community-access services and local programming. Gary Martin, a former college media instructor, urged commissioners to "prioritize cable money to remain in the cable system," arguing that public, educational and government channels provide unique civic value. Other commenters described concrete results from community-media programming: student scholarships that led to festival entries, public-health programs that prompted testing, and veterans- and nonprofit-focused series that reached local audiences.

Ad hoc committee: membership and timeline

Commission members agreed by consensus to form a budget priorities ad hoc that will operate with fewer than a quorum and report back quickly. Chair Brown will lead the subcommittee with the following commissioners volunteering to serve: Directors Rebecca Sloan, Hedges, Garrett Gatewood, Hackett Little and Middleton. Staff proposed using the law firm BBK to host and assist legal review; the executive director asked the subcommittee to aim for an initial meeting and recommendations in time for a September commission meeting and a more complete recommendation by December.

Next steps

Staff will begin the auditing steps described in the executive director's presentation and prepare materials for the ad hoc committee. Commissioners asked staff to present clearer options for preserving core services (metro operations, channel licensee support and community grants) and to return with a prioritized set of tradeoffs. The commission voted to approve the preliminary budgets as presented at the June 13 meeting; future mid-year modifications remain possible if revenues continue to decline.