Cable/Alarm Contracts

Pat,

I used to live in an HOA in Florida and long-term contracts with cable companies weren't illegal then (we had one). I don't know about now, though. The problem with states passing such laws is that according to the U.S. Constitution, states are prohibited from passing laws that effect existing contracts. The Supreme Court has ruled, howver, that under certain circumstances, such laws may be passed.

However, the FCC was (still is?) taking comments on that very subject and may decide to make such contracts illegal. The FCC has already banned "exclusivity" clauses in such contracts, so maybe this is what you're thinking of.

There is one very vocal advocate who is vehemently opposed to long term contracts and who visits this forum often. I expect he will respond to your question with a lot more information.

Pat,

I seem to recall hearing that some assn docs have a provision allowing the assn to terminate a contract made by the declarant while he was in control. In AZ there is a State law that only applies to condos which says the BOD may terminate a contract w/o penalty to the assn if entered into b/4 the BOD was elected by the unit owners. There are several provisions that apply. I would suggest thoroughly researching your CCRs and other gov. docs and also FL state law.

I found this info:

FCC to Ban Exclusive Contracts
Posted on January 10, 2008 by Daniel Zimberoff
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Trackbacks On January 4, 2008, the Federal Communications Commission (FCC) issued notice that it would implement its proposed ban on the use of exclusive contracts for existing video services in community associations and other multi-family housing developments. The ban would prevent cable companies from enforcing exclusivity clauses in video service contracts commencing in March 2008.

Previously, the FCC had issued an order confirming an October announcement that the agency would ban the enforcement of exclusivity clauses in existing video service contracts. An exclusivity clause is a contract term giving a provider, usually a cable company, the exclusive right of access or the exclusive right to provide video service in a community. As written, the order may affect community associations across the country.

The order applies to cable operators, telephone common carriers, and open video system operators. Providers of Direct Broadcast Satellite services and "private cable operators," which are companies that provide video service without using local rights-of-way, are not covered

Several industry groups have challenged the FCC’s authority to implement such a ban and the challenge will most likely delay implementation of the ruling into summer.

If your association has a contract with a video or cable programming distributor, you may want to review its provisions to determine if there is an exclusivity clause, and if so, what the effect on the contract will be once the FCC order goes into effect, assuming industry groups are unsuccessful in blocking the ban.

Thanks Virginia....

PatR,
Federal Register Documents are posted on:
http://banbulkbilling.com/index.php?topic=4.0

On summary the ruling,
"The Commission’s action concerns ‘‘Multiple Dwelling Units’’such as apartment or condominium buildings and centrally managed residential real estate developments(collectively, ‘‘MDUs’’); cable operators that provide video service in MDUs; and agreements that grant them the exclusive right to provide video programming service in an MDU. The Commission finds that such agreements,in granting exclusivity, harm competition, the provision of programming to MDU residents, and broadband deployment. Thus, the Commission prohibits the enforcement of existing exclusivity clauses and the execution of new ones by cable operators (and a few others)."