Ad Blitz Targets New Cable TV Tax Rules : Regulation: Station operators hire a political consultant and urge the public to contact politicians to protest assessments that have risen as much as 400% in a year.
Infuriated by county property tax assessments that in some cases have jumped by more than 400% in a single year, Orange County cable television operators have hired a local political consultant and this week launched an expensive advertising blitz.
The public relations campaign, said to cost $50,000 to $75,000, is intended to persuade county residents and cable subscribers who may face rate increases to complain to their elected representatives and especially the Board of Supervisors, which controls part of the tax assessor’s budget.
Full-page ads began running in The Times Orange County Edition and the Orange County Register on Tuesday and will continue all week. The ads alone will cost about $50,000, cable operators said.
In addition, the cable companies have hired Newport Beach-based political analyst Harvey Englander to coordinate their campaign.
“We’re going to spend a lot of money to fight this,” said James W. Bequette, western regional vice president of Comcast Cablevision, which has about 86,000 customers in Orange County. “We feel that there’s gross discrimination against the cable industry.”
John Gibbs, vice president for corporate and legal affairs at Continental Cablevision, agreed, adding that cable operators view this as a consumer issue and intend to press their case against the county.
At issue, several operators said, is a new type of tax assessment adopted by the county tax assessor, Bradley L. Jacobs. The system, adopted last year, has resulted in sharply higher tax bills, which are already being passed on to customers in the form of rate increases ranging from about $1.25 a month to more than $2 a month.
Under the new system, cable company executives said their businesses are being taxed not just on their property and physical plants, but also on such intangibles as corporate goodwill (which includes the value of its reputation and customer base), marketing aggressiveness and customer outreach. Those factors help determine a market value for a business but are not usually considered part of its property tax assessment.
Jacobs did not return phone calls Tuesday and has previously declined to comment on the subject, saying he will not address the topic while it is under appeal.
Cable operators, however, were outspoken in their opposition to the new system.
“We consider it illegal,” Bequette said. “It’s grossly unfair.”
Bequette and other cable operators said their industry has been singled out and warned that other businesses could face a similar situation if the assessor prevails in appeals now under way.
“The cable companies are the first to be saddled by this unfair, and inequitable tax,” Tuesday’s ad proclaimed. “Any business could be next, affecting consumer prices.”
The overall effect of the tax increase is still somewhat unclear, as the county’s largest cable operator, Dimension Cable, has not yet received all of its tax bills. Dimension, which serves about 105,000 households, is operated by Times Mirror Cable Television. Times Mirror is the parent company of the Los Angeles Times.
Dick Waterman, director of corporate affairs for Times Mirror Cable, said the company began passing on the cost of the increased tax bills to its customers last month, and it has added $1.27 to each customer’s monthly bill.
To pressure the tax assessor to rescind the assessments, the cable operators, through the ads, will ask county residents to clip out a coupon indicating their opposition to the new assessment process.
Neither Englander nor cable operators would be specific on how the coupon will read, but Englander said: “Our goal at some point is to be able to present to the Board of Supervisors an expression of public concern.”