HomeMy WebLinkAbout23-83BEFORE THE CITY COUNCIL OF THE CITY OF DANVILLE
IN THE MATTER OF:
Establishing Regulations for the
Granting and Operation of
Franchises for Cable Television
Systems and Service
ORDINANCE NO.
23-83
The City Council of the City of Danville DOES ORDAIN
as follows:
Section 1o Chapter 1, consisting of Sections 10-101
to 10-1127 is added to Title 10 of the Municipal Code, to
read as follows:
Article 1.
Article 2.
Article 3.
Article 4.
Article 5.
Article 6.
Article 7.
Article 8.
Article 9.
Article 10.
Article 11.
Article 12.
"CHAPTER 1
CABLE TELEVISION
General
Grant of Franchise
System Capability; Cable Service Generally
Design and Construction
Service to Individual Subscribers
Franchise Term: Duration; Termination.;
Transfer
Regulation and Evaluation of Franchise
Reports; Records; Inspection
Rights of Individuals
Insurance; Indemnification
Franchise Application and Acceptance
Miscellaneous
Article 1
General
Section 10-101
Section 10-102
Section 10-103
Section 10-104
Purpose
Citation
Rules of Construction
Definitions
Section 10-101. Purpose.
The City of Danville finds that the development of cable
television and communications systems has the potential of
having great benefit and impact upon the people of the City
of Danville. Because of the complex and rapidly changing
technology associated with cable television, the City finds
that the public convenience, safety and general welfare can
best be served by establishing regulatory powers which should
be vested in the City or such persons as the City designates.
It is the intent of this chapter to provide for and specify
the means to attain the best possible public interest and
public purpose in these matters. A franchise issued under
this chapter shall be considered to include this finding as
an integral part of it.
Section 10-102. Citation.
This chapter may be cited as the Danville Cable
Television Franchise Ordinance. 1~
Section 10-103. Rules of Construction.
This chapter shall be construed liberally to carry out
its purposes. Unless the context otherwise requires:
(1) Words. The present tense includes the future
tense, the plural includes the singular, the singular
includes the plural and the masculine includes the feminine.
(2) Captions. The captions to articles and sections
throughout this' chapter are intended solely to facilitate
reading and reference. Captions do not affect the
meaning or interpretation of this chapter.
Section 10-104. Definitions.
In this chapter unless the context otherwise requires:
-1-
(1) "access channel" means a channell available for
non-profit use by a government agency, educational
institution, community group or individual member of the
public;
(2) "additional outlet" means the wiring and electronics
to provide services to other than the primary outle~ for each
subscriber;
(3) "award agreement" includes each legally executed
document which awards a franchise, provides for its
acceptance and establishes conditions and standards
for performance under the franchise;
(4) "basic service" means the broadcast signal
required by FCC rules to be carried and such additional
broadcast signals that the City and operator agree shall
be carried.
(5) "cable television system," "cable communications
system" or "system" means a system of antennas, cables
amplifiers, towers, microwave links, cable-casting studios,
and any other conductors, converters, equipment or
facilities, designed and constructed for the primary
purpose of distributing video programming to home sub-
scribers, and the secondary purpose of producing, re-
ceiving, amplifying, storing, processing, or distribut
ing audio, video, digital, or other forms of electronic
or electrical signals;
(6) "channel" means a clear, contiguous, six
megahertz (6 MHz) frequency band, which is capable of
carrying either one standard audio/visual television
signal, or a number of audio, digital or other non-
video signals;
(7) "chief administrative officer" is the City
Manager or his designee;
(8) "City" is the City of Danville in its present
incorporated form or in any later reorganized, consoli-
dated, enlarged or reincorporated form;
(9) "closed-circuit" or "institutional service"
means such video, audio, data and other services pro-
vided to an institutional user on an individual
application, private channel basis. The services may
include, but not be limited to, two-way video, audio
or digital signals among institutions, or from
ins~i~ution~ to residential subscribers.
(10) "connection charge" or "installation charge"
is a nonrecurring charge for connecting or reconnecting
-2-
a subscriber to the cable television system, or to a
particular service;
(11) "converter" is the electronic apparatus
furnished by operator for the purpose of accomodating
a subscriber's TV set to reception of a greater number
of channels than its normal VHF allocation;
(12) "council" is the City Council;
(13) "decoder" is a device which descrambles signals;
(14) "drop" means the drop cable and related equip-
ment running from a tap in the plant to the subscriber's
outlet or terminal;
(15) "evaluation session" is a comprehensive
evaluation of the cable system and services as provided
in section 10-171;
(16) "FCC" is the Federal Communications Commission;
(17) "FM outlet" is the wiring and electronics to
provide service to an FM radio receiver;
(18) "franchise" includes every authorization
granted by City to Operator under this chapter and
the award agreement;
(19) "gross receipts" means the gross revenues
received by the Operator from all sources of operations
of the cable communications system, except that (1)
refundable deposits and (2) any sales, excise or other
taxes collected for direct pass-through to local-State
or Federal government are not included. Gross receipts
includes regular monthly subscriber fees for both
standard and premium service, installation charges,
disconnect and reconnect charges, and charges for use
of access origination or private service channels;
(20) "headend" means that portion of the system
consisting of the television receiving antennae, struct-
ures supporting such antennae, the associated channel
receiving and signal processing equipment which intro-
duce TV and FM signals into plant and the building or
buildings housing such equipment and equipment associated
with its use;
(21) "institutional network" or "institutional loop"
means a closed circuit portion of the cable system, de-
signed to provide communication services between insti-
tutions, such as schools, banks, etc.;
-3-
(22) "leased channel" or "leased access channel"
means a channel available for lease and programmed by
a person or entity other than the Operator and may in-
clude a portion of another access channel not in use
by its designated programmer;
(23) "municipal channel" or "muni~cipal access~channel''
is a channel where a local 'government agency is the
designated programmer;
(24) "open channel" means a channel that can be received
by subscriber~s without the necessity for special equipment;
(25) "Operator" is a person granted a franchise by
City under this chapter and includes the lawful successor,
transferee or assignee of Operator. Operator must be the
person who actually owns and operates the system covered
by its franchise;
(26) "person" includes a natural person and an
individual firm, association, organization, partnership,
business trust, company or corporation;
(27) "plant" means the co-axial cable or other trans-
mitting medium, amplifiers and related equipment and hard-
ware which enable the basic service to be transmitted from
the headend to subscribers, but excludes drops;
(28) "premium" or "pay-TV service" means pay-per-
program, pay-per-channel, or subscription service, i.e.
a commonly recognized non-advertiser-supported service,
such as HBO, TMC, HTN, which is delivered to subscribers
for a fee or charge over and above the regular charge
for basic service;
(29) "primary outlet" is the initial outlet installed
for the purpose of del~ivering basic service to a single
television set;
(30) "programmer" is a person who produces or other-
wise provides program material or information for trans-
mission by video, audio, digital, or other signals,
either live or from recorded tapes or other storage media,
to subscribers, be means of the cable communications system;
(31) "property of Operator" includes all property
owned, installed, or used within the franchise area by
Operator in the conduct of a cable television system
business under the authority of a franchise granted
under this chapter;
(32) "PUC" means the California Public Utilities
Commission;
-4-
(33) "SEC" means the Securities and Exchange
Commission;
(34) "street" means the surface, the air space
above the suEface and the area below the surface of
a public or private street, including a common drive-
way serving two or more units located on two or more
separately owned parcels of land; "street" includes
other public rights of way or public places, including
public utility easements;
(35) "subscriber" is a person receiving all or
part of a service offered by Operator.
-5-
Article 2
Grant of Franchise
Section 10-111
Section 10-112
Section 10-113
Section 10-114
Authority
Rights Reserved to City
Limitations '~
Franchise Payments
Section 10-111. Authority.
(a) Authorization. The City may grant a franchise
to any person whether operating under an existing license
or offering to furnish and provide such a system. By
accepting the franchise, the Operator agrees to supply
the system and services required for the full term of
the franchise. No person shall distribute television
or radio signals by means of a cable system unless he has
a franchise to do so under this chapter.
(b) Franchise is Non-Exclusive. A franchise
granted under this chapter is non-exclusive. The Council
shall determine when it is in the public interest to grant
a franchise under this chapter. This chapter does not
require the grant of a franchise or prevent the Council
from permitting more than one cable system to operate within
the City at any time.
(c) Amendments. During the term of the franchise
the City may amend this chapter to require additional or
greater standards of construction, operation or maintenance
on the part of the Operator, including the payment of a
greater percent of the gross annual receipts of a franchise
for the remaining term of the franchise.
(d) Uses Permitted. A franchise authorizes the
Operator to engage in the business of operating and providing
a cable television system within the franchise area, and for
that purpose to erect, install, construct, repair, replace,
reconstruct, maintain and retain in, on, over, under, upon,
across and along any street, such poles, wires, cable,
conductors, ducts, conduit, vaults, manholes, amplifiers, and
appliances, attachments, and other property as may be
necessary and appurtanant to the system; and, in addition,
so to use, operate and provide similar facilities or properties
rented or leased from'other persons, including but not limited
to a public u~ili~y or other person franchise area. Nothing
in this chapter is intended to grant to Operator an easement
or right-of-way over private property. This chapter does
not relieve Operator of any requirement of the City now or
-6-
hereafter in effect, including a requirement relating to
street work, street excavation permits, undergrounding of
utilities or the use, removal or relocation of property
in streets.
(e) Operator Rules and Regulations. The Operator may
impose such rules, regulations, terms and conditions governing
the conduct of its business as are reasonably necessary to
enable the Operator to exercise its rights and perform its
obligations under this franchise. However, those rules,
regulations, terms and conditions may not conflict with
this chapter or applicable State and Federal laws, rules
and regulations. Operator shall provide to each subscriber
a simple and easy to understand written summary of any rules
which relate to such things as service charges; services;
service installations, modifications and repairs; payment,
and other items of significant interest to subscribers. The
Operator shall periodically supply subscribers with written
notice of any substantive changes to rules which directly
affect the subscriber's charges or services.
Prior to the approval of a franchise, the Operator
requesting the franchise shall submit a complete copy of its
Rules and Regulations to the City and such operating Rules
and Regulations shall be deemed approved by the City upon
granting of the franchise. Any subsequent changes in
Operator Rules and Regulations shall require prior approval
of the City, if so required by the Franchise Agreement.
(f) Annexations. If unincorporated territory served
by Operator under authority granted by Contra Costa County
is annexed to the City, Operator's franchise issued under
this chapter, including regulated subscriber rates, applies
to the annexed territory upon the effective date of
annexation, to the extent permitted by law.
Section 10-112. Rights Reserved to City.
(a) City Powers. Neither the grant of a franchise
nor a provision of this chapter is a waiver or bar to the
exercise of any other governmental right or power by the
City. In accepting a franchise, the Operator acknowledges
that its rights are subject to the police power of the City
to adopt and enforce general ordinances necessary to the
safety and welfare of the public, and it agrees to comply
with all applicable general laws and ordinances enacted by
the City under such power.
Any conflict between this chapter and any other
present or future lawful exercise of the City's powers shall
-7-
be resolved in favor of the City, except that any such
exercise that is not of general application in the juris-
diction or applies exclusively to Operator or cable
communications systems and which contain provisions incon-
sistent with this chapter shall prevail only if an emergency
exists constituting a danger to health, safety, property
or general welfare or such exercise is mandated by law.
(b) Responsibility Delegation. The City may
exercise or delegate its rights and responsibilities under
this chapter. The City may assign a right, power or duty
of the City to a designated officer, employee, department
or board of City.
(c) Right to Acquire. City may acquire the property
of Operator, in whole or in part, either by purchase or by
the exercise of the right of eminent domain, at a fair and
just value. Fair and just value does not include any amount
for the franchise itself or for any of the rights or
privileges granted.
(d) Right to Require Removal of Property. At the
expiration of the term for which the franchise is granted,
or upon its revocation, the City may require the Operator
to remove at its own expense its cable system from the
streets and public ways within the City.
(e) Right to Inspect. City has the right to
inspect Operator's reports, records and facilities as
provided in Article 8.
Section 10-113. Limitations.
(a) Limitation. No privilege or exemption is
granted or conferred by a franchise granted under this
chapter except those specifically prescribed.
(b) Prohibitions.
the following:
Operator is prohibited from doing
(1) engaging in the business of selling at
retail, leasing, renting, repairing or servicing
of television sets or radios;
(2) soliciting or referring a subscriber to
persons engaged in any business which Operator may
not engage in;
(3) providing information concerning the
viewing patterns of identifiable individual subscribers.
-8-
(c) Other Statutes. A franchise granted under this
chapter is subject to present and future requirements
prescribed by applicable federal, state, county and local
law.
(d) Use of Other Facilities. A privilege claimed
under a franchise granted in a street is subordinate to
a prior or subsequent use of the street for public purposes.
The franchise does not relieve the Operator of its obligation
to obtain electrical, encroachment or other permits from
City or a utility company.
(e) Time. Time is of the essence for the franchise.
Operator is not relieved of its obligations to comply
promptly with any provision of this chapter by City's
failure to enforce prompt compliance.
Section 10-114. Franchise Payments.
(a) Franchise Fees. In consideration of the granting
of a franchise, Operator shall pay to City during the life
of the franchise, a certain percentage of the system's
annual gross receipts attributable to subscribers and within
the City's franchise area. The fee shall not be less than
3%, nor shall it exceed the maximum limit specified by law.
The City reserves the right, however, to collect a franchise
fee of five percent (5%) of the Operator's gross annual
receipts if and when the City elects to seek an FCC waiver
to exceed the currently authorized 3% limit. To the extent
required by a franchise agreement the City and the Operator
shall jointly submit and recommend approval of an application
for the FCC waiver of the 3% limit.
During the term of the franchise, the City may by
resolution increase the franchise fee percentage of gross
annual receipts to that percentage specified as a new maximum
limit for such fees by future Federal and/or State legislation.
(b) Other Costs. Operator shall reimburse the City
for all costs actually incurred by the City in obtaining
professional advice and assistance during the term of
Operator's franchise with respect to the appropriateness,
feasibility, reasonableness and desirability of the exercise
by Operator of the rights granted to it under this chapter.
(Such costs may include technical testing and evaluation,
evaluation of a change in rates, and review of applications
for extension, renewal or transfer of the franchise.) However,
Operator is not required to pay the City more than an amount
equal to 2% of annual gross receipts with respect to any
calendar year for thesescosts. City's costs for any year for
which it is otherwise entitled to reimbursement which exceed
-9-
such limit may be carried forward to succeeding years and
reimbursed in amounts up to 2% of annual gross receipts
for up to three succeeding years.
The reports and records required under this
chapter shall be furnished at Operator's expense.
Operator shall reimburse City for the costs
expended in soliciting and evaluating applications and
processing the franchise award to the extent such costs
are not recovered from the application fees.
(c) Payment.
(1) Fees due the City under subsection (a)
shall be computed at the end of each calendar
quarter on the basis of gross receipts during
such quarter. Within 60 days after the end of
each of the first three quarters of each calendar
year, Operator shall pay the City the amount due
for each quarter. Within 60 days after the end
of each calendar year, Operator shall compute
the total amount due the City for the calendar
year and shall pay that amount, less the aggregate
amount of quarterly payments previously made to
City during the calendar year. Each payment shall
be accompanied by Operator's report showing in
reasonable detail (as may be specified from time
to time by City, such specification to be changed
not more often than once each year), its computation
of gross receipts for the quarter or year covered.
At Operator's option, the provisions of this section
may be satisfied on a fiscal year and fiscal
quarter basis.
(2) Payment of sums due City under subsection
(b) shall be made within 30 days after receipt of
billing by Operator.
(d) Non-Waiver. Acceptance of a payment is not a
release or an accord and satisfaction of any claim City
may have for additional sums payable or for the performance
of any other obligation under this chapter.
-10-
Article 3
System Capability; Cable Service Generally
Section 10-121
Section 10-122
Section 10-123
General Service Requirements
Community Service Programming
Rate Procedures
Section 10-121. General Service Requirements.
(a) Capability
(1) A cable system operated under this
chapter shall comply with the specifications set
forth in this chapter and in the award agreement.
It shall operate at a minimum over the frequency
spectrum from 50 to 400 MHz. The system shall
provide a minimum capability of 54 Class 1 Video
Channels from the outset. Signal carriage and
placement shall be as specified in the award
agreement.
(2) The system shall from the outset be
capable-of providing upstream carriage of signals
over the frequency spectrum from 5-30 MHz as needed
for purposes such as data transmission, telemetry
or remote cablecasts of locally originated
programming, in accordance with the technical
specifications set forth in the award agreement.
(3) An award agreement approve~ by the City
shall include a specific plan for activatingltwo-
way services by January, 1989. The Operator may
request, and the City may extend this date. The
City's decision with regard to any requested
extensions shall take into consideration technical,
economic and service demand factors related to
two-way service.
(4) The system shall provide a broad spectrum
of FM radio signals to all subscribers.
(5) The system shall operate continuously
24 hours per day, each day of the year.
(6) Operator shall furnish to each subscriber
at all times the highest quality picture and sound
permitted by current technology and the quality of
the signal received for transmission in accordance
with the technical standards and specifications set
forth in the award agreement.
-11-
(7) Operator shall make all reasonable efforts
to provide a range of services responsive to a broad
spectrum of community needs and interests. Initial
radio and television signal carriage shall be as
set forth in the award agreement.
(b) Changes in Services Offered.
(1) Changes. Changes in the channels or
services set forth in the award agreement (with
respect to channels not dedicated for community
service purposes) including realignment of signals
on the cablecast spectrum, shall be at the
discretion of the Operator, to the extent such
changes are permitted by the FCC. Operator shall,
however, furnish written notice to the City of its
intent to make any changes in signal alignment or
services offered at least 90 days before the
intended date of such change.
Operator shall also provide information
to subscribers reqarding an Operator initiated
change, by written and cablecast message. Informa-
tion provided by cablecast message shall be
repeated several times throughout the viewing day
for at least 3 consecutive days. If a channel or
program service is discontinued, Operator shall
immediately provide a substitution.
(2) Opportunity for Review. If, in the
opinion of the Council, the public interest or
adverse community response is sufficient to warrant
its review of a change, either before or after its
implementation, the Council may provide an oppor-
tunity (by public hearing or other means) for
community and Operator response to determine whether
a mutually satisfactory resolution of the problem
can be achieved.
City may consider a rate adjustment to
permit continuation of a program service that would
otherwise be discontinued. If, after good faith
negotiations, City and Operator are unable to agree
upon a rate adjustment sufficient to enable Operator
to retain or add a desired channel or service, or if
a service is unavailable for reasons other than cost,
Operator need not provide the service in question.
-12-
(3) No Reduction in Channels. This section
does not permit a reduction in the total number of
channels available under basic service unless the
City consents to a reduction.
(c) Information to Public. Subscribers shall be given
ready access to accurate and current information on all
program offerings available on the cable system, including
the programming available on all community service channels
(to the extent such information is made available to Operator).
The City may at any time require the Operator to provide a
written program guide detailing the available services and
programs if it determines such information is incomplete or
unavailable from other sources. If required, Operator shall
provide the guide on a voluntary subscription basis and at
a reasonable cost. Operator shall also provide program
information, including community service program announcements,
on a character-generated channel.
(d) Failure to Comply. Failure to comply with the
requirements of this section is an immaterial breach and
subjects Operator to monetary penalties as provided in
section 10-175 (Franchise Violations). Repeated or excessive
failure to comply with these requirements may constitute a
material breach as set forth in section 10-153 (Termination).
(e) Free Service to Community Sites. Operator shall,
as City may from time. to time request, furnish one
installation for basic service each, without installation
or monthly service charge, to all City buildings, each
Fire and Police Department station, each public school,
public library, recreational facility, community center and
other community service facility open to the general public
and designated by the City; and Operator shall provide
additional basic service outlets at these locations at its
cost of labor and materials, without other installation
charges and without monthly service charge. If an
installation required by the City requires an extension of
the Operator's distribution plant not otherwise required by
this chapter the installations shall be made by the Operator
at its cost of time and materials to be paid by the public
agency for which the service is provided.
Section 10-122. Community Service Programming.
The purpose of this section is to provide the means for
high quality professional cablecasting of community-oriented
programming which originates locally or is particularly
responsive to local needs and interests.
-13-
(a) Channel Capacity.
following without charge:
Operator shall provide the
(1) at least one channel each for public
access, educational access and municipal access;
and
(2) all interface equipment and cabling
necessary to permit transmission of these channels
on the cable system.
If the City determines there is a need for additional
access channel capacity, the City may require Operator to
provide up to 3 additional channels for this purpose. The
award agreement shall set forth procedures for such action
including reasonable notice and opportunity for response by
the Operator. This provision does not preclude the
Operator's voluntary allocation of a greater number of
access channels.
(b) Operator Support. Operator shall provide the
following without charge and in accordance with specifica-
tions in the award agreement:
(1) studio facilities, production, editing
and Other equipment, staffing and ongoing financial
support and other resources in order to permit
quality cablecasting (both live and on tape) on
the access channels;
(2) portable equipment to enable production,
and for remote insertion, of live programming from
points other than the community studio; and
(3) advice and technical assistance in the
effective use of the access channels.
(c) Community Service Radio Access. Operator shall
allocate an FM channel, or designated time periods on a
channel, of its FM radio spectrum for community service
programming without charge, as requested by the City.
(d) Access to Upstream Bandwidth. Operator shall
provide without charge access to portions of its upstream
bandwidth when requested by an access channel in order to
permit direct feed of community service programming to the
head-end for purposes of transmitting live or recorded
material on an access channel. Operator shall also,
wi~hou~ charge, provide ~he equipment and technical assistance
required to activate the origination capability of each access
channel from both the head-end and remote sites.
-14-
(e) Access for Data, Audio, and/or Telemetry Transmission.
The City may require the Operator to make available, without
charge, access to portions of the system's upstream and down-
stream bandwidth not otherwise in use, for purposes of data,
audio, and/or telemetry transmission by the City, public
schools, or other government or public service agencies.
The City may require this access only after the City and
the Operator have agreed upon mutually satisfactory procedures,
including provisions: (1) enabling the Operator to realign
or regain such frequencies for its own use when needed; and
(2) development of a reasonable service call contract to
cover Operator's expenses in making and servicing system
connections in support of City circuits.
(f) Other Use of Access Channels. Subject to
limitations specified in the award agreement, Operator may
use available air time on an access channel at no charge
for its own programming purposes during the periods of
time the channel is not otherwise needed for community
service programming.
(g) Access Channel Management. The City wishes to
ensure that each access channel is operated in the highest
public interest. The City may delegate responsibility for
operation and management of a channel to another entity
such as a public non-profit corporation representing a
broad spectrum of the community. The City may authorize
the entity to receive and allocate funding, facilities,
equipment and other resources for community service
programming purposes, develop and administers, operational
policies, hire and supervise personnel, and undertake
other responsibilities necessary for access channel operation.
(h) Implementation. Procedures and conditions to
implement this article shall be set forth more specifically
in the award agreement. The procedures and conditions may
include:
(1) placement of access channels on the
television spectrum of channels;
(2) Operator support;
(3) Operator use of access channels;
(4) community service radio access;
(5) both upstream and downstream access to
portions of the bandwidth required for interactive
transmission of video, audio, telemetry, data or
other signals; and
-15-
(6)
leased access to access channels.
Section 10-123. Rate Procedures.
(a) Subscriber rates and charges shall be as set
forth in the award agreement. No increase in any rates
or charges for basic service shall be permitted for the
first 12 months after the new or rebuilt system is
completed as defined in section 10-133b(3) and operating
pursuant to this award.
(b) Subsequent proposals to increase rates or
charges for basic service shall be submitted to the City
in writing, and shall include the following:
(1) An audited balance sheet and income
statement for the most recent three full fiscal
years;
(2) Copies of submissions to the FCC on
Forms 325 and 326 for the most recent three full
years;
(3) A pro forma balance sheet, income
statement and projection for the fiscal year
following, assuming the requested rates and
such other changes as Operator may project;
(4) Supporting schedules as required,
including:
Detail of total system operating
revenues and system expenses;
B. Number of subscribers;
Detail of assets and depreciation
and amortization schedules;
(5) A schedule of all rates and charges-in
effect and proposed; and
(6) Other supporting facts as the City requests.
The data provided shall be certified as true and
accurate by Operator's Chief Financial Officer. The finanacial
statements and statistics required shall cover the Operator's
system in the City of Danville.'. However, if the system Nerving
Danville is part of a larger cable television system, then
the franchise agreement shall specify those parts of the
Operator's system for which financial information shall be
required.
-16-
(c) Procedure. Upon receipt of Operator's request
for changes in subscriber rates and charges for basic
service, City shall schedule a public hearing within 30
days after receipt of all supporting financial information.
City shall finally act on the request within 120 days after
the close of the public hearing. City and Operator may
mutually agree in writing to extensions of the deadlines
set forth in order that Operator may prepare and provide
additional data requested by City. If City does not act
within 120 days, the Operator's proposed amendment to the
rates and charges becomes effective. To the extent that a
proposed amendment is disapproved, City shall within the
120-day period, or mutually agreed extensions, set forth
in writing its findings of facts. City, in arriving
at its decision to approve or disapprove Operator's
request, may consider relevant factors such as Operator's
quality of service, comparable rates in similar systems,
and Operator's performance in meeting franchise requirements.
In setting subscriber rates and charges, the
Operator is entitled to recover the reasonable cost of
providing service, including a fair return on the Operator's
invested capital.
(d) Converters. There may be no rental charge for
the use of a converter box to receive basic service. The
Operator may require a security deposit for a converter
in an amount and under terms established by the franchise
agreement.
-17-
Article 4
Design and Construction
Section 10-131
Section 10-132
Section 10-133
Section 10-134
Section 10-135
General
System Interconnection
Construction
Default
Removal of Facilities
Section 10-131. General.
(a) Capability. The cable system shall comply with the
specifications in Section 10-121 and the award agreement.
(b) Intent. It is the intent of the City to have cable
services made available to all residents of the City wishing
such services. It is understood that the cable television
system presently serving within the City does not fully satisfy
the requirements of Articles 3 and 5 of this chapter. Subject
to the other provisions of this chapter and the award agreement,
an Operator shall undertake to construct, or reconstruct, a
system which will fully satisfy the requirements of this
chapter in accordance with this article.
(c) Plant Installation and Extension.
(1) A new or rebuilt cable system shall be con-
structed so that cable services will be available to
all structures now included in the existing cable system.
The Operator shall, as part of the application
requirements provided in Article 11, set forth its
intentions for extension of the plant to occupied
areas of the City not served by the existing cable
system, and such areas shall be included in the
construction timetable.
(2) If the construction plans of a prospective
Operator exclude any currently occupied area of the City,
the prospective Operator shall set forth the basis for
the exclusion. Upon satisfactory showing of special
circumstances (such as low population density or geo-
graphical constraints, making it technically or economi-
cally infeasible for Operator to install the cable system
plant in a given occupied area without reimbursement
from the subscriber(s) to be served for unusual costs of
construction) the City may waive the requirement for
mandatory installation of plant.
(3) The Operator shall extend residential and
institutional service (the latter as set forth in the
-18-
award agreement) into every new subdivision. The
capacity to provide cable communications service shall
be available to newly constructed structures on the
date of first occupancy. Actual installation of ser-
vice may be delayed up to 60 days from first occupancy
or until after final grading, whichever is first. Those
new areas having more dwelling units per strand mile of
plant than the number specified in the award agreement
shall receive residential service for the normal
installation fee.
Section 10-132. System Interconnection.
(a) Desirability. Interconnection with other cable
television systems is desirable for such purposes as:
(1) sharing educational programming throughout
the San Ramon Valley Unified School District;
(2) sharing educational and locally originated
programming with other cable systems in Contra Costa
County;
(3) participating in opportunities to receive
public interest, information or educational services
which may become available on a regional or state-
wide basis.
(b) Interconnection. Operator shall, upon the directive
of City and in conformance with the technical specifications
set forth in the award agreement interconnect its system with
any or all other systems serving the franchise area, and any
other systems which can be interconnected with Operator's
system. Any additional investment by Operator required to
achieve interconnection shall be considered by City in connec-
tion with subscriber rates.
To the extent the technical requirements necessary
to achieve interconnection are known at time of system design,
the cable system shall be constructed so as to make inter-
connections feasible with a minimum of system modification at
the time such opportunities become available.
(c) Cooperation. Operator shall cooperate with any
interconnection corporation, regional interconnection authority
or County, State or Federal regulatory agench which may be
established for the purpose of regulatingfacilitating, financing,
or otherwise providing for the interconnection of cable tele-
vision systems beyond the boundaries of City's jurisdiction.
(d) Notice: City Approval. Operator shall provide con-
tinuing notice to the City of all interconnection opportunities
-19-
as they become available on a regional or local basis, in-
cluding copies of correspondence from any entity seeking
interconnection with this system.
Section 10-133. Construction.
(a) Permits. Within 30 days after acceptance of the
franchise, Operator shall proceed with due diligence (and at
its own expense) to obtain all necessary permits and authori-
zations which are required in the conduct of its business,
including, but not limited to, certificate of compliance,
utility joint use attachment agreement, microwave carrier
license, and other permit, license and authorization to be
granted by regulatory agencies having jurisdictionover the
operation of cable tel-vision systems or associated micro-
wave transmission facilities. City shall process Operator
applications in an expeditious manner.
(b) Commencement; Completion.
(1) Commencement. Within 90 days after obtaining
necessary permits, licenses and authorizations, in-
cluding right of access to poles and conduits, Operator
shall begin construction or reconstruction and insta-
llation of the system.
(2) Completion. Except as expressly approved by
City and specified in the franchise and subject to de-
lay by reason of Act of God, force majeure, riot,
strike, or other condition beyond Operator's control
(written notice of which shall be promptly given to
City), Operator shall complete construction or recon-
struction of the entire system not later than 12
months after execution of 'the award agreement.
System construction is considered complete upon
installation of all required facilities and marketing
of all services to the entire franchise area, (excepting
those areas exempted from service under this chapter).
(c) Undergrounding. The term "undergrounding" includes
a partial undergrounding of cable equipment. All plant and
drops shall be underground in the same areas and to the same
extent as electric utility services. Upon obtaining the City's
written approval, amplifiers, taps, traps and other appurte-
nances may be placed in appropriate housing above the ground.
The Operator shall, at its own expense (unless the award agree-
ment or other ordinances and agreements provide for payment by
others) install its plant in the same trench, at the same time,
as the electric utility, whether or not there is a specific re-
quest from a potential subscriber for service. Upon written
approval of the City, the Operator my satisfy the requirement
-20-
of this subsection by placing conduit and other required
appurtenances, without cable, in the trench.
With respect to a residential structure erected in the
franchise area after the effective date of this chapter, and
notwithstanding the foregoing, the owner or developer shall
perform or cause to be performed or shall pay Operator's reasonable
cost of all trenching necessary for the underground installation
of service, including furnishing of imported backfill material,
the furnishing and installation of substructures, conduit and
pedastals in accordance with the Operator's plans and speci-
fications. Subject to Article 5, Operator shall provide, in-
stall and pay for all other of its plant in the trench.
Operator shall provide plans and specifications to the owner
or developer and shall inspect the facilities required and
certify to City prior to final approval of the development
that the facilities required are properly installed. City
may review the maps and specifications provided by Operator.
(d) Maps and Layout. Operator shall maintain and permit
City to inspect up-to-date route maps of suitable scale showing
all receiving pickup locations and the location of amplifliers
and trunk distribution lines. Lines to individual outlets
need not be shown. The scale of the maps shall be sufficient
to clearly show the required details and shall be at least 1
inch = 400 feet.
(e) Construction Standards. The system shall be installed
and maintained in accordance with standard good engineering prac-
tices and shall conform when applicable with the National Electric
Code, Bureau of Standards Handbook No. 130, Rules for Overhead
Line Construction (General Order No. 95) of the California Public
Utilities Commission, the California Administrative Code, Title
24, Part 3, and all applicable codes.
Operator shall utilize existing poles, conduits, and other
facilities whenever possible, and may not construct or install
new, different, or additional poles, conduits, or other facili-
ties on public or private property without written approval of
City or private property owner in cases where no easement exists.
(f) Other Construction, etc. Operator at its expense
shall protect, support, temporarily disconnect, relocate, or
remove its property when, in City's opinion, this action is
required by reason of traffic conditions, public safety, street
vacation, freeway or street construction, change of establishment
of street grade, change or installation of sewers, drains, water-
pipes, power line, signal or communication lines, transportation
facilities, tracks, or other types of structure or improvements
by governmental agencies (whether acting in a governmental or a
proprietary capacity), or any other structure or public improve-
ment. However, if action taken under this subsection is primarily
for the benefit of a new commercial enterprise, then the
-21-
commercial enterprise shall reimburse Operator for its actual,
direct, out-of-pocket costs and expenses incurred. Action
taken under this section is not a taking of the Operator's
property and Operator is not entitled to a surcharge.
Section 10-134. Default.
Upon Operator's failure, refusal, or neglect to perform
work or other act required by law and complete it in, on,
over, or under a street within the time prescribed, City may
have the work or other act completed and upon so doing shall
submit to Operator an itemized statement of the costs.
Operator shall within 30 days after receipt of the statement,
pay to City the amount stated.
Section 10-135. Removal of Facilities.
If
(1) the use of any part of the public cable system is
discontinued for any reason for a continuous period of 7 days
without prior written notice to and approval by City; or
(2) a franchise is terminated, cancelled, or expires;
then Operator shall remove its facilities and restore the
affected areas in accordance with section 10-157 (Disposition
of Facilities). Operator is not required to remove conduit
from underground.
If cable facilities are installed in a street or other
area without complying with this chapter, City may require
the removal or reconstruction of those facilities.
-22-
Article 5
~'rvice To Individual Subscribers
Section 10-141
Section 10-142
Section 10-143
Subscriber Connections; Rates
and Charges
Subscriber Complaints; Repair
Services
Disconnection of Service
Section 10-141. Subscriber Connections; Rates and Charges.
(a) General. Installation of service to subscribers
shall be done in a workman like manner and in conformance with
all applicable requirements including the codes of the City
of Danville and the California Public Utilities Commission.
Prior to installing service on, or over a subscriber's prop-
erty, the Operator shall advise the subscriber of the
Operator's intended installation plan. If the subscriber
requests specialized installation work, the Operator may re-
quire that the subscriber's request be in writing and may
charge the subscriber based on the Operator's time and
materials cost in excess of standard installation. Special-
ized installations for which additional charges are required
of the subscriber shall not be made by the Operator unless
an estimate of installation charges is provided to and
approved by the subscriber in advance of the work being done.
(b) Standard Installation:
Additional Outlets.
Primary Drop and
(1) Primary Drop. The standard charge for connecting
a subscribers premise to the cable plant shall be as set
forth in the franchise agreement and as may be adjusted
from time to time to reflect actual changes in Operator's
costs in accordance with that agreement and this chapter.
(See section 10-123.)
Operator shall install primary drops at the standard
rate to each subscriber currently capable of being con-
nected to the existing cable system at a standard rate.
(2) Additional Outlets. The charge for installation
of an outlet in addition to the primary connection shall
be as set forth in the award agreement and as may be ad-
justed from time to time in accordance with the award
agreement and this chapter.
Operator shall install an additonal outlet at a
standard charge unless special circumstances make the
installation more costly than usual as provided in
subsection (c).
-23-
(3) Operator shall make no charge to a sub-
scriber already connected to the existing cable
system for a replacement connection necessitated
by a rebuilt or new cable system if the subscriber
authorizes connection to the new or rebuilt system
at the time the cable plant is installed. A sub-
scriber requesting connection at a later date may
be assessed the standard charge.
(c) Special Installation Charges. Operator may
assess an additional charge for a special installation to
or within a structure. A special installation includes
one or more of the following:
(1) there exist special conditions in the
structure or the property upon which it is located
or the subscriber requests a drop which is substantially
different from what the Operator would have done had
there been no such request;
(2) the installation is remote ("remote drop"),
the distance to subscriber's building being more than
150 feet from the nearest street or the nearest point
on Operator's distribution plant, whichever is closer;
(3) The installation is in a low density area~
in which case subsection (d) also applies.
For a special installation, Operator may asses a
special charge, limited to the actual cost of labor and
materials in excess of a standard installation. A subscrib-
er's liability is limited to the standard charge, however,
unless Operator has provided an itemized estimate and ob-
tained the subscriber's prior w~tten consent to the special
charge.
(d) Installation in Low Density Areas. If the City waives
the mandatory installation requirement under Srticle 4 as to any
currently occupied area of the City, Operator shall, during con-
struction or rebuilding, provide notice to each prospective sub-
scriber in any such exempted area of the opportunity to have the
cable system installed in that area upon payment of a special
fee. If a prospective subscriber then indicates a desire to
be served, Operator shall provide a written estimate of the
fee to be charged for extending cable system plant to the area
in question. Any easements required for special installation
shall be obtained by the subscriber, or by the Operator at the
subscriber's expense.
Franchise granted by the City shall include a specific
line extension policy to implement this subsection.
-24-
(3) The procedures by which a subscriber may
request an adjustment in a service charge for periods
of impaired service,! as set forth in sUbsection (3),
including the right to seek resolution of disputes
from the City representative.
(e) Reduction in Charges for Extended Interruptions.
Each subscriber is entitled to a pro-rata reduction of
cable service charges if a system malfunction or other in-
terruption causes a:
(1)
(2)
Loss of service for 12 consecutive hours;
or
repeated losses of service which total 12
hours in a week.
For each such loss of service a subscriber may deduct 1/30th
of the monthly bill. If only part of the service is interrupted
(for example, loss to a secondary outlet or loss of an expanded
tier of service), the subscriber may only deduct for that part
of the service which was impaired.
If a service interruption exceeds 12 consecutive hours
or a total of 12 hours in a week, a subscriber may request an
adjustment other than that provided in this subsection. The
Operator shall provide in its rules and regulations for a
procedure by which the subscriber may request and receive
a credit against its monthly charge for such an extended
service interruption.
The period of interruption is the time elapsing between
Operator's receipt of notice or complaint and restoration of
service.
If subscriber and Operator are unable to unable to agree
on a mutually acceptable adjustment in charges, subscriber and
Operator may jointly agree to resolve the dispute by arbi-
tration under section 10-174. If subscriber and Operator
do not agree to arbitration, then either party may direct
the problem to the attention of the City representative and
the procedure provided in section 10-173(b) shall govern.
The City may suspend the provisions of this subsection
(e) during period of system reconstruction.
(f) Record of Complaints, Interruptions, Malfunctions.
Operator shall maintain a record of every complaint, service
interruption and system malfunction. The record shall in-
clude the nature and location of each such problem, the date
and time notice or complaint was received, and its disposition,
including the time taken to respond and to complete repairs.
-25-
Section 10-142. Subscriber Complaints; Repair Services.
(a) Local Office. Operator shall maintain an office
within the franchise area for receiving and resolving sub-
scriber complaints and problems. The office shall be
open during normal business hours, not less than 9:00 a.m.
to 5:00 p.m. on --eekdays, excluding legal holidays. The
office shall have a publicly listed telephone number, .
toll-free to all subscribers, and shall have facilities
to receive and respond to complaint calls 24 hours per
day, 7 days a week. The City Council may, by resolution,
waive the requirement of an office within the franchise
area and provide instead for an office within a reasonable
one way driving distance of the franchise area upon find-
ing that the ability of the Operator to respond is not
adversely affected.
(b) Prompt Repair Service. Operator shall provide
efficient service, make repairs promptly and shall limit
system failures and malfunctions to the minimum time
duration possible by promptly investigating and acting
upon service complaints. When there is a loss os service
to an individual or the system, Operator shall restore
Operator's normal standard of service within 24 hours
of receiving notice of the problem. Operator may restore
service by temorary means for up to 72 hours. Time for
completion is not extended for holidays or weekends.
Operator shall maintain a staff of technicians capable
of responding to a system malfunction within 24 hours of
receipt of notice or complaint and may not charge a sub-
scriber for repair of a system malfunction.
(c) Service Interruptions. Operator may initiate
a service interruption only for good cause and for the
shortest time possible. In case of scheduled service
interruption Operator shall make all reasonable efforts
to minimize inconvenience to the subscribers, including
when possible, at least 24-hour advance notice of the
interruption.
(d) Information to Subscribers. Operator shall provide
written information to subscribers setting forth procedures
for making an inquiry or complaint. The information shall
be provided at the time service is begun and whenever re-
quested. Such information shall include:
(1) The name, address and toll-free telephone
number of the Operator's department responsible for
subscriber complaints and requests for repairs;
(2) The name, address and telephone number of
the City office or representative that subscribers
may contact if a complaint regarding service or fees
is not satisfactorily resolved by Operator,
-26-
These records shall remain available for inspection at the
Operator's local "~usiness office for at least 3 years after
any transaction recorded in them.
Section 10-143. Disconnection of Service.
(a) Disconnection for Nonpayment. The Operator may dis-
connect or discontinue service to a subscriber for nonpayment
of charges for services rendered if:. 1) the subscriber has
received at least one full month of service without providing
full payment; 2) the customer has not paid the amount in dis-
pute in escrow (section 10-173(d); and 3) the Operator has
given the following written notice:
(1) An itemized statement of charges, sent at
least 10 working days before the date the bill is
due, and;
(2) a statement to the subscriber of his right
to deposit the amount in dispute in escrow in order
to avoid disconnection.
(b) Manner of Disconnecting. Service disconnected
under this section shall be done by Operator in the most
efficient practical manner.
(c) No Charges. There shall be no charge for dis-
continuing service but Operator may require, in addition
to payment of any delinquent fees, a reasonable fee for
reconnection.
-27-
Franchise Term:
Article 6
Duration; Termination; Transfer
Section 10-151
Section 10-152
Section 10-153
Section 10-154
Section 10-155
Section 10-156
Section 10-157
Section 10-158
Duration
Extension; Renewal
Termination
Holding Over
Transfer of Ownership
Continuity of Service
Disposition of Facilities
Prior Cable System
Section 10-151. Duration.
No franchise granted by the City under this Chapter
may be for a term in excess of 15 years.
Section 10-152. Extension; Renewal.
(a) Extension. The City may extend a franchise for
periods of up to five years at a time. Before the City
grants an extension, Operator shall comply with the
requirements set forth in subsection (c).
(b) Renewal. If the Operator applies for a renewal
of the franchise, the renewal application must be submitted
not less than 13 months nor more than 2 years before the
franchise expiration date. For a renewal, any terms and
conditions of the existing franchise may be renegotiated,
including provisions related to changes in technology and
in community needs and preferences. If Operator does not
apply for a renewal or extension or if renegotiations do not
result in a mutually acceptable agreement, the franchise
terminates at the expiration of its term without further
action by the City.
(c) Information Required. In applying for renewal or
extension of a franchise, Operator shall comply with informa-
tional and procedural requirements established by the City.
These requirements may include: (i) providing a comprehensive
System and Services Evaluation described in section 171; (ii)
a survey of subscribers, conducted by the City at Operator's
expense; (iii) consent for performance testing and technical
evaluation conducted by the City or its representative, at
Operator's expense; (iv) reimbursement for other costs rela~ed
to City's evaluation of the application, including costs of
professional consultants; and (v) other requirements which may
-28-
be established by City at the time a renewal or extension
application is submitted. The City shall provide opportunity
for community review and comment including at least one
noticed public hearing before granting a renewal or extension.
Section 10-153. Termination.
(a) Grounds. If Operator fails or refuses to comply
with a material requirement of this chapter or the award
agreement, the City may declare the franchise terminated or
exercise its other remedies as provided in this chapter. If
a franchise is terminated, the Operator shall immediately and
automatically surrender all rights granted by the franchise
and the award agreement.
Grounds for termination under this section include:
(1) excessive or repeated failure to meet
required standards of construction, operation,
technical performance of subscriber service in a
timely manner;
(2) failure to maintain the required
liability and indemnification coverages or the
performance bond;
(3) frequent violation by Operator of an order
or ruling from a regulatory entity having jurisdiction
over Operator, excepting an order or ruling being
contested by Operator in judicial or administrative
proceedings.
(4) fraud or deceit;
(5) insolvency or bankruptcy;
(6) unauthorized transfer of the franchise
or the cable television system;
(7) willful, flagrant, and repeated violation
of a franchise requirement.
If Operator is in material breach of the franchise, City
shall have the right, in addition to other rights it may have,
to terminate the franchise.
(b) Procedure. Before invoking its rights under this
section, City shall make a written demand that the Operator
correct the violation or cure the circumstances constituting
the breach. If after 30 days the Operator has not complied
or submitted sufficient evidence of its intent and ability
to do so within a reasonable period of time, the City shall
-29-
give the Operator notice of the matter to be heard and the
time and place of hearing at least 10 days before the hearing.
At the termination hearing, Council shall consider
recommendations of City staff and comments from the Operator
and interested persons. The Council shall then determine
an appropriate course of action for enforcement or termination
of the franchise.
Section 10-154. Holding Over.
If Operator holds over after termination or expiration
of a franchise without the prior consent of City expressed
by a Resolution, Operator shall pay the franchise fee~on the
same basis as that existing before expiration or termination,
it being understood that acceptance of the franchise fee pay-
ments by City is not a recognition by City of any right of
Operator to an extension or renewal of the franchise.
Operator shall also pay any applicable penalties.
If the Operator continues an unauthorized operation
for 90 days after notice from the City, the Operator forfeits
to the City all its gross revenues from the system for the
balance of the period the unauthorized operation continues.
Section 10-155. Transfer of Ownership.
(a) Consent of City Required. A franchise is a
privilege to be held in personal trust by the original
Operator. It may not be sold, transferred, leased,
assigned or otherwise disposed of, in whole or in part,
either by forced or involuntary sale, or by voluntary
sale, merger, consolidation or other means, without the
prior consent of City and then only under such conditions
as the City prescribes.
(1) A transfer may be made only by an
instrument in writing, such as a bill of sale.
A copy of the proposed instrument shall be filed
with the City at the time Operator applies for City
consent to the transfer. If the transfer is approved,
a copy of the executed document shall be filed
with the City not less than 30 days after the transfer
is executed.
(2) The consent of the City may not be
unreasonably withheld. However, the City may first
evaluate the proposed transferee as to financial
responsibility, ability to provide the required level
and quality of service and ability to assume the
-30-
obligations of the franchise. The proposed transferee
shall comply with the informational and procedural
requirements of City for such evaluation including the
submission of evidence documenting its financial ability
to satisfy the requirements of the franchise. The
proposed transferee shall reimburse City for the costs
of the evaluation, including professional assistance,
in accordance with section 10-114(c).
(3) If Operator is a corporation, prior approval
of the City is required when there is an actual change
in control, or if ownership of 25% or more of its
voting stock is to be acquired by a person or group
of persons acting in concert, none of whom already
own 25% or more of the voting stock, singly or
collectively.
The consent of the City is not required for
transfer of the franchise to a wholly-owned subsidiary
of the Operator. However, the City shall continue to
regard the Operator and its transferee as a single
entity for all purposes.
(4) The City may not consent to the sale,
transfer, lease or assignment of a franchise until
all required system construction is complete, and the
system is supplying the required level of service to
all subscribers, unless the City finds that it is in
the public interest to consent to such a transfer in
order for those requirements to be fulfilled.
(.5) Upon foreclosure or other judicial sale of
all,or a substantial part of the system or upon the
termination of a lease covering all or a substantial
part of the system, Operator shall notify the City of
the fact. The notification shall be considered as
notice that a change in control of Operator has occurred.
In this case City's approval of the new owner of the
system must be obtained as herein required.
(b) Receivership. City may cancel a franchise 30 days
or later after the appointment of a receiver or trustee to take
over and conduct the business of Operator, whether in receivership,
reorganization, bankruptcy, or other action or proceeding,
unless the receivership or trusteeship is vacated prior to the
expiration of the 30 days, or unless:
(1) within 30 days after his election or
appointment, th~ r~ceiver or trustee complies with
this chapter and remedies all defaults; and
-31-
(2) such receiver or trustee, within 30 days,
executes an agreement, approved by the court, whereby
the receiver or trustee assumes and agrees to be
bound by this chapter and the f~anchise granted to
Operator.
(c) Express Assumption of Responsibility. A transferee
shall expressly assume all obligations of Operator and
expressly agree to be bound by this chapter and the award
agreement and is required to sign the award agreement.
(~ Failure to Comply. Failure to comply with the
requirements of this section is a material breach of this
chapter, subject to the remedies provided for herein.
Section 10-156. Continuity of Service.
(.a) Continuity of Service Mandatory. A subscriber is
entitled to continue receiving service so long as his
financial and other obligations to the Operator are met.
Operator shall not cease providing full subscriber service
before the expiration date set forth in an agreement, license,
or franchise in effect at the time this chapter is enacted
or before the expiration date set forth in an award agreement
entered into under this chapter, unless the City authorizes
cessation or terminates the franchise under the provisions
of section 10-153 (Termination).
(b) Changes in Operation. In the event of a change
in operation (~due to such factors as modification of the
system, acquisition, termination, or expiration of the
franchise), the Operator shall in good faith make every
reasonable effort to ensure that service continues
uninterrupted during the transitional period accompanying
a change.
(c) Extended Service.
(1) If the franchise expires or is terminated,
the City may require the Operator to continue
operation and service for a period not to exceed
one year. During the extension the City may reduce
the boundaries of the areas Operator is required to
serve by partial termination of the franchise,
effective upon at least 30 days written notice to
Operator. This chapter applies during a period of
extended service.
(d) Cooperation with Successor. In the event of
expiration of termination, Operator shall cooperate in good
faith with its successor in interest. Cooperation required
-32-
may include but is not limited to moving Operator's plant to
temporary positions on telephone poles where necessary to
enable installation by successor without unnecessary pole
make-ready costs. The successor shall reimburse the incumbent
Operator for direct, actual and verifiable out-of-pocket
expenses incurred by Operator in responding to requests for
cooperation.
(e) Willful Cessation of Service. If Operator fails
to provide continuous service on all or part of its
system, and City establishes that the failure is willful
and without just cause, the City may, upon service of
notice to the Operator, assume operational control of the
system. City may continue its control until full service
is restored under conditions acceptable to the City or a
permanent alternate is found to operate the system. During
the period of City control, revenues from portions of the
system under City control become property of the City.
Willful cessation of service is a material breach of
the franchise and a ground for termination in accordance
with the procedures in section 10-153 (Termination). The
City may also impose monetary sanctions in accordance with
this chapter.
Section 10-157. Disposition of Facilities.
(a) General Requirements. If a franchise is
terminated, cancelled or expires, City may order Operator
to promptly remove its facilities from the City within a
specified period of time. After such removal, Operator shall
promptly restore the street and other areas from which
property is removed to its condition before Operator's use.
Operator is not required to remove conduit from underground.
(b) Restoration of Property. In removing its plant
structures and equipment the Operator shall refill at its
own expense each excavation made by it and shall leave all
public ways and places in as good condition as that prevailing
before Operator's removal of its equipment and appliances
without affecting the electrical or telephone cable wires~
or attachments. City shall inspect and approve the condition
o~ the public ways and public places and cables, wires,
attachments and poles after removal. The liability, indemnity
and insurance and the performance bond shall continue in
effect during the period of removal and until full compliance
by Operator with the terms and conditions of this paragraph
and this chapter.
(c) Removal or Restoration by City; Reimbursement of
Costs. If Operator fails to complete the work required by
subsection (b) above or any other work required by City law
or ordinance within the time provided and to satisfaction of
City, City may cause the work to be done and Operator shall
reimburse the City for the cost within 30 days after receipt
of an itemized list of the costs, or City may recover such
costs through any security fund or bond provided by Operator.
(d) Abandonment of Property. City may, upon written
application by Operator, approve the abandonment of
Operator's property in place, under such terms and conditions
as City prescribes. Upon abandonment of property in place,
Operator shall execute, acknowledge and deliver to City
such instruments as City prescribes transferring and
conveying the ownership of the property to City.
Section 10-158. Prior Cable System.
It is understood that the Operator currently providing
cable television services to the City is operating under
authority of a license previously granted by the County Board
of Supervisors. This license expires in October, 1986.
Nothing in this chapter shall be construed as abridging the
term of that license, or as altering the rights and obligations
of the parties under it, absent the mutual consent of the
present Operator and the City. However, if the present
Operator enters into a new award agreement with the City under
this chapter before the expiration date of the existing
license, the prior license and all rights and obligations of
the parties under it terminate upon the effective date of
the new award agreement.
-34-
Article 7
Regulation and Evaluation of Franchise
Section 10-171
Section 10-172
Section 10-173
Section '10-174
Section 10-175
Performance Evaluation
Compliance with Technical Standards
Dispute Resolution Procedures
Arbitration
Franchise Violations
Section 10-171. Performance Evaluation.
(a) Evaluation of System and Services. City and Operator
shall periodically hold a comprehensive evaluation session in
accordance with procedures~set forth in this article. The pur-
pose of this is to evaluate the cable system and services, to
provide for technological, economic and regulatory changes
occurring in the cable industry, to promote the maximum de-
gree of flexibility in the cable system, and to achieve a con-
tinuing, advanced, modern system responsive to community needs
and desires.
(b) Frequency of Evaluation Sessions. The first evalu-
ation session shall be held on or about the 3rd anniversary
date of the award agreement unless continued to a later date
by the City. Subsequent evaluation sessions shall be held
at the request of the City. No more than one session may
be required during any three year period, unless required
to consider a request for renewal or extension of the fran-
chise. A dispute arising between evaluation sessions is
subject to the dispute resolution procedure in section 10-173.
(c) Report. Operator shall prepare a written report
before the evaluation session. At least 120 days before the
scheduled session date, the City shall provide the Operator
a list of the information to be included in the report.
Topics for the report may include the following:
(1) a summary of system operations during the
period since the franchise award or the last report,
including: (A) services changed or added; (B) rate
changes for any services; (C) total number of sub-
scribers each year and number of subscribers added and
discontinued in each year; (D) level of subscriber
complaints and system malfunctions and success in
-35-
resolving them; (E) support and assistance provided to
community service television operations; (F) operational
compliance with technical requirements; (G) a financial
statement for each year during the period, and a list of
changes in the Company's officers, directors, partners or
stockholders and equity investors holding a 5% or greater
share; and (H) copies of Operations FCC forms 325 and
326 for each year of the period.
(2) a detailed description of new or developing
cable technologies:and services,l!including a list of
these then being provided to other cable systems in
the United States not currently available in this
system, a statement regarding Operator's intention
for providing them and the basis for any contention
that they are not feasible or desirable in this
system.
Operator shall submit its report at least 60
days in advance of the scheduled evaluation session.
(d) Evaluation Session.
(1) The evaluation session shall be open to the
public and announced in a newspaper of general circu-
lation in the service area. Operator shall cooperate
in providing cablecast notice, repeated several times
throughout the viewing day for no less than 3 consecu-
tive days, and if required by the City, shall at its
own expense, mail notice to all subscribers at least
10 working days before the session date.
(2) Topics which may be discussed at the evaluation
sessionsinclude, but are not limited to: service provided,
rates charged, system performance, programming offered,
customer complaints, territory to be added to service
area, amendments to applicable ordinances and agreements,
and developments in legal or regulatory constraints. City,
Operator and members of the public may select additional
topics for the agenda.
(3) Within 60 days after the conclusion of an
evaluation session, the City shall issue a report if
it finds the cable system operations fail to meet the
requiremnets of this chapter or the award agreement,
or are deficient in meeting community needs and desires.
-36-
(e) Deficiencies. If the City finds cable operation defi~_
cien~i~swhlc~ have violated this chapter or the award agree-
ment, it may impose the applicable penalties. Operator
shall promptly correct each violation.
(f) Changes. If the City seeks an addition to .Qrchange
in cable system services, the Operator shall, within 120
days after receipt of the City's findings, submit an analysis
of the requested modification, including a description of the
means for implementation and documentation of all associated
costs, including charges to subscribers which would result.
The City and the Operator shall then begin good faith nego-
tiations in ~rder to arrive~at a~ mutually acceptable plan for
the provision of the desired services within a reasonable
time and at a reasonable cost.
If the negotiations do not result in an agreement
between the parties within 60 days after submission of
Operator's feasibility analysis, either party may require
the matter(s) to be submitted to arbitration under section 10-174.
Section101172. Compliance with Technical Standards.
Not more than once each yea~,Cit~may~reqU~reI0perator
to'submit evidence of a comprehensive~test of the cable system's
technical performance and its compliance with technical standards
of the franchise.
Where the test results, a pattern of subscribers
complaints or other evidence casts doubt upon the quality
or reliability of cable system performance, the City may
require that special tests, limited to the matter in question,
be conducted at Operator's expense. City may require that
these special tests be supervised by a professional engineer
approved by the City at the Operator's expense. The engineer
shall sign the record of each special test and forward it to
the City with a report interpreting the result and recommend-
ing action to be taken.
Operator shall cooperate in performing the testing, and
shall submit any required report within 30 days after testing.
Sectio'n 10-173. D__ispute Resolution Procedure.
(a) Information to Subscribers. Operator shall inform
subscriberS'of the right to bring unresolved problems to the
City's attention.
(b) Operator Response Hearing. If, during the period
between evaluation sessions a problem or dispute arises con-
cerning cable system operations, the City may require the
Operator to submit a written response. to include a plan
for resolution of the problem~ or correction of the violation.
The City shall allow the Operator a reasonable period of
time within which to prepare its response, not to exceed 30
days. Thereafter, the Council may hold a hearing to consider
the matter and may require the Operator to furnish notice
of the hearing to affected subscribers at Operator's expense.
If, after the hearing, the Council finds that a
franchise violation occurred, it may impose a penalty under
this chapter and the Operator shall promptly correct the
violation.
(c) Delegation of Power. Council may delegate all or
part of its review powers under this chapter to a cable
review board commission or to a City employee. If these
powers are delegated, either Operator or a member of the
public who is dissatisfied with the decision of City's
representative may appeal the decision to the Council for
hearing and determination under the procedure set forth
for appeals of decisions. The Council may accept, reject
or modify the decision of City's representative, and may
adjust, settle the controversy or cancel a charge arising
from cable system operations or from a provision of this
chapter.
Section 10-174. Arbitration.
Arbitration of a matter subject to arbitration under
this chapter shall be conducted by a committee of three
arbitrators: one appointed by City, one appointed by
Operator, and the third appointed by the other two arbitrators,
or failing agreement between them, by the American Arbitra-
tion Association.
Arbitration may be initiated by either party by giving
the other written noticeand specifying in the notice the
name of the arbitrator appointed by the initiating party.
The other party shall notify the initiating party in writing
of the name of its arbitrator within 7 days after receipt of
notice from the initiating party. If the two arbitrators
appointed are unable to agree upon a third arbitrator within
7 days thereafter, they shall immediately request the
American Arbitration Association to appoint a third arbitrator,
and shall request that the appointment be made within 7 days.
-38-
Hearings on a matter submitted for arbitration shall
begin within 3 business days after appointment of the
third arbitrator, shall be conducted within the franchise
area, and shall be conducted in accordance with the rules
of the American Arbitration Association.
The hearings shall be conducted expeditiously and
an award agreed to by a majority of the arbitrators is
final and binding upon all parties. Judgment upon the
award may be entered by a party in the court having juris-
diction.
Where in the judgment of a majority of the arbitators
either party's claim or defense is frivolous, costs of the
other party including attorney's fees, may be awarded to
the other party and included in the final award. Failing
an award, each party shall bear its own costs of arbitra-
tion and shall share equally the cost of the third arbitrator.
Section 10-175. Franchise Violations.
(a) Remedies, Generally. If Operator violates
provision of this chapter or the award agreement, or fails
to comply with a requirement in a timely manner, the City
may do any of the following:
(1) assess monetary penalties as set forth
in this section;
(2) require Operator to cure violations
before increasing any rates or charges to sub-
scribers;
(3) terminate the franchise for cause, as
set forth in section 10-153 (Termination).
The exercise of these remedies is not a waiver by the
City of any other remedy it may have, including the right
to recover for damages, losses, costs and expenses, includ-
ing attorney's fees arising from a franchise violation.
This provision for recovery of damages is in addition to
the City's right to apply its remedies under Article 10.
(b) Procedure. If the City believes Operator has
violated this chapter or the award agreement, or an appli-
cable Federal, State or local regulation, the City may make
a written demand on the Operator to correct the violation.
-39-
If the violation is not corrected within a reasonable time as
set forth in the demand, the City shall consider the matter
at a public hearing. The City shall serve the Operator with
written notice of the matter to be considered and the time
and place of the hearing at least 10 days before the scheduled
date of the~hearing. At the time of the hearing Operator and
any interested persons shall be heard. Council may determine
at that or subsequent meetings an appropriate course of action
for enforcement or termination of the franchise.
(c) Immaterial Breach. In order to provide City with
some remedy for immaterial or minor breaches other than
expensive and time consuming legal actions, City may impose
a fine on Operator for an immaterial breach of the franchise.
If, after a hearing as provided for in Section 10-175(b)
above, the Council determines that Operator has violated a
provision of this chapter or the award agreement it may impose
a fine not to exceed the amounts set forth in this subsection.
The actual amount of the fine shall be based upon the
significance of the violation, its impact on subscribers,
its duration, whether the violation was beyond Operator's
control, and other pertinent circumstances.
These penalties are in addition to any rate adjustments
to which subscribers may be entitled.
(1) Construction Violations. For failure to
meet construction requirements, to perform
construction work within the required time periods,
or to begin service to subscribers in a timely manner,
the City may impose a fine of up to $500 a day, or
up to $2,000 a day for construction delays exceeding
6 months.
(2) Performance Violations. For failure to
meet standards of service, maintenance, operation
or administration, or for failure to do so in a timely
manner, the City may impose a fine of up to $250 per
business day. Violations sub~j~ect to this provision
include, but are not limited to: failure to provide
required services; failure to provide timely repairs;
service interruptions without just cause; unauthorized
disconnection of subscribers; failure to give required
notice or to maintain and permit inspection of records
as required; violations of technical standards,
including required signal carriage; and failure to
comply with any regulatory requirements, including
payment of sums owed to the City.
-40-
(d) Material Breach. The quality and quantity of
immaterial breaches in and of themselves may amount to a
material breach, in which event the franchise may be
terminated.
(e) Payment of Fine. City shall give Operator
written notice of a fine assessed under Section 10-175(c)
and Operator shall pay the fine within 30 days after
receipt of notice, or, if Operator requests arbitration
under Section 10-174, within 30 days after receipt of
notice of an arbitration award in favor of City.
If Operator does not pay a fine within the required
30 days, interest on amount of fine accrues monthly at the
rate of 1% per month. If City brings suit to enforce the
payment of a fine and prevails, Operator shall pay attorney's
fees and costs in addition to the fine and interest thereon.
Article 8
Reports; Records; Inspection
Section 10-181
Section 10-182
Section 10-183
Section 10-184
Section 1-1085
Reports
Records
Inspection of Reports and Records
Inspection of Facilities
Miscellaneous
Section 10-181. Reports.
Operator shall prepare and submit to City the following
reports:
(1) Performance Evaluation Reports
(see section 10-171)
(2) Information for Renewal of Extension
of a Franchise (see section 10-152)
(3) Annual Reports. The payment made to the City
at ~he end of each calendar year shall be accompanied
by a profit and loss statement for the system which
serves the franchise area, covering the year with re-
spect to which payment is made, showing reasonable detail
information required by the City. If the system serving
the franchise area also serves other area, Operator may
elect to~furnish a profit and loss statement governing
the entire system. In this case, sufficient information
shall be provided to determine City's allocated pro-
portion of total.
(4) Reports Filed With Other Agencies. Operator
shall submit to City a copy of each petition, appli-
cation, pleading, report, communication and other
documents related to the cable system in this franchise
area which is submitted by the Operator to the FCC, PUC,
and any Federal, state or local regulatory agency or
court having jurisdiction over the cable system in this
franchise area (except SEC filings where only incidental
reference is made to the system). Operator shall submit
such documents simultaneously with their submission to
the court, agency, or other body.
To the extent it is not precluded by law from doing
so, Operator shall submit to City a copy of each income
tax return which is filed with the State and Federal
governments pertaining to its cable system in the fran-
chise area.
-42-
(5) Miscellaneous Reports. Operator shall submit
to City other information or reports in such forms and
at such times as the City may request.
Section 10-182. Records.
(a) Financial Records. Operator shall keep true and
accurate books and records in conformity with generally
accepted accounting principles, consistently applied, showing
all income, expenses, borrowing, payments, investments of
capital costs and expenditures, and other transactions
relating to the system serving the franchise area.
Operator shall keep the records required for at least
5 years after any transaction recorded in them.
(b) Maps. Operator shall maintain complete maps and
plans showing the location of the cable system equipment in-
stalled in streets and other public places in the City and
the geographical areas of the City currently served by the
cable system.
(c) Subscriber Complaints and Repair Services.
Operator shall maintain a record of each request for service,
subscriber complaint, service interruption and system mal-
function and shall keep this record for at least 3 years
after the transaction recorded in it in accordance with
the provisions of section 10-142(f).
(d) Reports. Operator shall maintain a copy of each
report referred to in section 10-181 for at least 5 years.
Section 10-183. Inspection of Reports and Records.
City has the right to inspect Operator's reports and
records at any time during normal business office hours.
Upon written request Operator shall provide City with copies
of required records.within 5 business days.
Section 10-184. Inspection of Facilities.
The Operator shall allow the City to inspect the
Operator's facilities and equipment at any time upon one
days prior notice,~or, in case of emergency, upon demand
without prior notice.
City may inspect at reasonable times construction or
installation work performed and to make tests, if necessary,
to ensure compliance with the terms of the franchise.
Section 10-185. Miscellaneous.
(a) Audit. City may require Operator to furnish an
outside recognized public accounting firm to conduct an audit,
not more than one each fiscal year, of Operator's records re-
lating to subscribers and the statements furnished by Operator
under section 10-182(a) for the purpose of certifying their
accuracy. The firm conducting the certification audit shall be
approved by City, but approval may not unreasonably be with-
held. Operator may provide such certification by a notarized
and sworn certificate from an officer of Operator or its
parent company.
(b) False Statements. A meterially false or misleading
statement or representat'ion made knowingly by the Operator
in a record or report required under the franchise is con-
sidered a material breach of the franchise.
(c) Cost of Reports. The Operator shall furnish each
report and record required under this or any other section
at Operator's expense.
-44-
Article 9
Rights of Individuals
Section 10-191
Section 10-192
Section 10-193
Non-discriminatory Service
Privacy
Equal Employment Opportunity
Section 10-191. Non-discriminatory Service.
Operator may not deny service, deny access, or other-
wise discriminate against a subscriber, channel user or
general citizen on the basis of race, color, religion,
national origin, age or sex. Operator shall comply at
alltimes with Federal, State and local laws and regulations,
and executive and administrative orders relating to non-
discrimination.
Section 10-192. Privacy.
The monitoring of any subscriber terminal without
specific written authorization from the subscriber is
prohibited. The Operator is responsible for protecting
subscriber privacy and for prohibiting the tapping and/or
monitoring of cable, line, signal input device, or sub-
scriber outlet or receiver for any purpose, except the
Operator may conduct tests of the functioning of the
system where necessary in order to ensure proper maintenance
of the system and to collect performance data for agencies
regulating the quality of the signal. Where critical
information requires private communication, electronic
signal scrambling techniques must be used.
Operator may not sell or otherwise release listings
os subscribers' names and addresses or any list which
identifies individual subscriber viewing habits to any
person without specific written authorization from the
individual subscriber.
The Operator may not place in a residence equipment
capble of two-way communications without the written con-
sent of the resident(s), and may not use the two-way
communications capability of the system for subscriber
surveillance without the written consent of the subscriber.
Operator may not attach to a residence or other
property a cable, line wire amplifier, converter, or
other piece of equipment without first obtaining the
written permission of the owner or responsible occupant
of any property involved. If such permission is later
-45-
revoked, whether by the original or subsequent owner or
responsible occupant, the Operator shall promptly remove
all of its equipment and restore the property to as near
its original condition as possible.
No poll or other two-way subscriber response may be
conducted unless the program of which the poll is part
contains an explicit disclosure of the nature, purpose,
and prospective use of the results of the poll. No
commercial or other use of information regarding sub-
scriber viewing habits or patterns may be made and no
release of such information is permitted without the
prior consent of the Council.
If a court order requires disclosure of information
about an individual subscriber, Operator shall notify
the affected subscriber.
Section 10-193. Equal Employment Opportunity.
Operator shall strictly adhere to the equal employment
opportunity requirements of the FCC, State and local
regulations, and as amended from time to time.
-46-
Article 10
Insurance; IndemnilficatiOn.
Section 10-1101
Section 10-1102
Section 10-1103
Section 10-1104
Section 10-1105
Section 10-1106
Section 10-1107
Performance Bond
Hold Harmless Agreement
Defense of Litigation
Insurance Required
Security Fund
Worker's Compensation
Breach
Section 10-1101. Performance Bond.
Upon filing the acceptance required under article 11,
Operator shall file with the City, and shall at all times
thereafter maintain during the term of the franchise, an
acceptable corporate surety bond, irrevocable letter of
credit drawn in the City's name, or other adequate surety
agreement (security) in the amount of $50~000.1 The
security shall be conditioned so that in the event the
Operator fails to comply with any provision of the franchise,
there will be recoverable jointly and severally from the
principal and surety any damages, loss, or costs suffered
or incurred by the City as a result thereof, including
attorney's fees and costs of any action or proceeding, and
including the full amount of any compensation, indemnification,
or costs of removal or abandonment of property as prescribed
elsewhere in this chapter or other costs which may be in
default, up to the full amount of the bond, letter of credit
or other surety agreement. The condition shall be a continuing
obligation during the term of the franchise and thereafter thntilthe
Operator satisfies all obligations to City which pertain to
the franchise. Neither this 'section nor the security accepted
by City nor damages recovered by City under the!security
excuses faithful performance by Operator or limits Operator's
liability for damages.
If, at any time during the term of the franchise, the
condition of the corporate surety changes in such a manner as
to render the bond, letter of credit or other surety agreement
unsatisfactory to the City, the. Operator shall replace it with
other security of like amount and similarly conditioned,
issued by a corporate surety satisfactory to the City. The
Council may authorize or require appropriate adjustments in
the amount of the security required under this section.
-47-
Section 10-1102. Hold Harmless Agreement.
Operator shall indemnify and hold harmless City, its
officers, boards, commissions, agents, and employees from
claims, demands, causes of action, suits, proceedings,
damages (including but not limited to damages to City
property and damages arising out of copyright infringements,
and damages arising out of any failure by Operator to secure
consents from the owners, authorized distributors or
licensees of programs to be delivered by Operator's cable
television system), costs or liabilities (including costs of
liabilities of City with respect to its employees), of
every kind and nature whatsoever, including but not limited
to damages for injury or death or damage to person or
property, due to the act or failure to act of Operator, its
employees or agents and regardless of the merit of any of
the Same~ including attorneys fees, accountant fees, expert
witness or consultant fees, court costs, per diem expense,
traveling and transportation, or other costs or expense
arising out of or pertaining to the exercise or the enjoyment
of any franchise hereunder by Operator, or the granting
thereof by City.
Section 10-11'03. Defense of Litigation.
Operator shall at its expense, upon demand by City,
defend all suits, actions, or other legal proceedings
whether judicial, quasi-judicial, administrative or
legislative, brought or instituted against City, its
officers, boards, commissions, agents, or employees, and
arising out of or .pertaining to the act or failure to act
of Operator, its employees or agents.
Operator shall pay and satisfy every judgment, decree,
order, directive, or demand made or issued against Operator,
City, its officers, boards, commissions, agents or employees
when it is directly attributable to the acts or failure to
act of Operator, its employees or agents. Such indemnity
shall exists and continue without reference to or limitation
by the amount of any bond, policy of insurance, deposit,
undertaking or other assurance required under this chapter.
However, neither Operator nor City shall enter into any
compromise or settlement of a claim, demand, cause of action,
suit, or other proceeding, without first obtaining the
written consent of the other, which shall not unreasonably
be withheld.
-48-
Section 10-1104. Insurance Required.
Upon the filing of the acceptance required under article
11, Operator shall file with the City and shall thereafter
during the term of the franchise maintain at its own cost
and expense, general comprehensive liability insurance in
the amount of $2,000,000 together with bodily injury
liability insurance in an amount not less than $500,000 for
injuries including accidental death, to any one person, and
subject to the same limit for each person in an amount not
less than $1,000,000 on account of any one occurrence, and
property damages liability insurance in an amount not less
than $100,000 resulting from any one occurrence. City shall
be named as an insured in each insurance policy. Where
insurance is provided by a policy which also covers Operator
or another entity or person, it shall contain the standard
cross-liability endorsement. By regulation City may from
time to time reasonably increase the required face amounts
of insurance as to any then-existing franchise.
Certificates evidencing insurance coverage shall be
filed with the City at the beginning of the franchise term.
Each certificate shall provide that the insurance coverage
will not be cancelled, reduced or changed without at least
30 days prior written notice to the City. At least 30 days
before expiration of a policy, a certificate showing that
the insurance coverage is renewed shall be filed with City.
If Operator fails to obtain or keep insurance in force,
City may (but shall not be required to) obtain insurance in
which event Operator shall promptly reimburse City its
premium cost plus 10% interest until paid.
Section 10-1105. Security Fund.
The City may in the award agreement require the Operator
to establish an insured account as security for the Operator's:l)
faithful performance of the requirements of the franchise; 2)
compliance with all orders, permits and directions of the City;
3) payment of any claims, liens, payments and taxes due the City.
The security fund, if required, shall operate as follows:
(1) Within (30) ~days after'the.effective'dat~ of the
franchise, the Operatorshall deposit into an insured account,
established by theCity,land maintain on deposit throughout
the term of the franchise, an!amount of~dollars as set forth
in the award agreement, forthe purpose set forth in the first
paragraph'for this section. Operatormay~earn interest on funds..
aep6~itedin'the se~urtiyfund.
-49-
(2) The City may withdraw money from the security
fund, including interest and penalties due, if any of
the following occurs:
A. After 10 days notice, the Operator fails
to pay to City:
i. taxes or payments due and unpaid; or
ii. damages, costs or expenses which the
City has incurred because of Operator's
default.
B. After 30 days notice, Operator fails to
comply with a provision of the franchise which the
City determines can be remedied by an expenditure
from the security fund. City shall notify the
Operator of the amount and date of withdrawal.
(3) Within thirty (30) days after notice that an
amount has been withdrawn by the City from the security
fund under this section, the Operator shall deposit a
sum of money sufficient to restore the security fund to
the original amount.
(4) The security fund established under this section
shall become the property of the City if the franchise is
cancelled because of the default of the Operator or revoked
for cause. The Operator is entitled to the return of the
balance of the fund at the end of the franchise term or at
the earlier termination if there is then no outstanding
obligation.
(5) Upon Operator's successful completion of system
construction, the City may reduce the security fund to a
lesser amount and refund the difference to Operator.
(6) The rights reserved to the City with respect to
the security fund are in addition to all other rights and
remedies of the City under the franchise.
Section 10-1106. Worker's Compensation.
Upon filing of the acceptance under Article 11, the
Operator shall file with the City and shall thereafter, during
the entire term of such franchise, maintain Worker's Compen-
sation Insurance coverage in at least the minimum amounts
-50-
required by law. If the Operator fails to maintain the
required insurance, the City may, without notice to
Operator, obtain such insurance at Operator's expense
or terminate the franchise as provided in section 10-1107.
Section 11-1107. Breach.
Operator's willful failure to provide and keep in
force a bond, security agreement or policy of insurance
required under this chapter is, at City's election, a
material breach of the franchise.
Article 11
Franclhise Application and Acceptance
Section 10-1111
Section 10-1112
Section 10-1113
Section 10-1114
Section 10-1115
Section 10-1116
Content of Application
Application Fee
Solicitation; Report; Criteria
Procedure
Persons Included
Acceptance of the Franchise
Section 10-1111. Content of Application.
Each application for a franchise shall include (in
addition to any other items required by City at that
time), the following:
(1) The name, address, and telephone number of the
applicant;
(2) A detailed statement of the corporate or other
business' entity organization of the applicant including;
~he following:
A. the names and business addresses of all
officers and director of the applicant;
B. the names and business addresses of all
officers, persons and entities having, controlling,
or being entitled to have or control 1% or more of
the ownership of applicant and the respective owner-
ship share of each such person or entity;
C. the names and addresses of any parent or
subsidiary of applicant, the names of any other
business entity owning or controlling applicant in
whole or in part, and a statement describing the
nature ofthe parent or subsidiary business entity,
including cable television systems owned or controlled
by applicant, its parent and subsidiary and the areas
served;
D. a detailed description of all previous
experience of theapplicant in providing cable television
system service and in related or similar fields. For
~ach o~her cable franchise currently or previously held
the applicant shall set forth:
-52-
1. Inclusive dates of each franchise held;
2. Geographical location;
3. Population of franchise area;
4. Number of homes passed by the cable system;
Number of subscribers in each of the last 5
years of the franchise;
6. Description of services offered, including:
a. Channel capacity of system;
b. Number of channels offered to subscribers;
Identification of stations and services
offered on each tier of programming;
d. Most recent rates charged for each type
of service offered;
Support offered to community service
programming (as defined in this chapter)
including channels allocated, facilities,
equipment and funding.
E. a detailed and complete financial statement
of the applicant, certified as correct by an officer
of the applicant, for the 5 fiscal years preceding
the date of the application (or if applicant has been
in operation less than a five year period, a financial
statement for the period of operation), and applicant's
detailed and complete financial projections for the
five year period beginning with the date upon which
applicant begins operations, certified as the true and
correct financial basis for applicant's application;
F. a statement identifying by place and date
every other cable television franchise awarded to the
applicant, its parent or subsidiary, construction under
which has not been completed as required by the franchise;
the status of the franchise with respect to completion of
construction; and the amount of applicant's and its
parent's or subsidiary's resources committed to the
completion.
-53-
G. a description of any litigation taking place
between applicant, its parent or subsidiaries, and
any municipal#state or federal entity within the last
10 years, including in each such instance: the identity
of the litigants, the date suit commenced; a description
of the subject matter of the dispute and the relief
sought by the litigants; the identity of the Court hear-
ing the.~.dispute; and a description of any settlement or
judgment that resulted.
H. a description of any municipal, federal or
state, judicial or administrative sanctions imposed,
proposed or in force against applicant, its parent or
subsidiaries at any time in the last 10 years.
(3) A detailed description of the proposed plan of
operation of the applicant which shall include the following:
A. a detailed map indicating all areas proposed
to be served, and a proposed time schedule for the
installation of all equipment necessary to become
operational throughout the entire area to be served;
B. a statement of schedule setting forth all
proposed classifications of rates and charges to be
made against subscribers and all rates and charges as
to each classification including installation charges
and service charges;
C. a detailed, informative, and reference state-
ment describing the actual equipment and operational
standards proposed by the applicant. Operational
performance standards may not be less than those
specified by the FCC on the date this chapter takes
effect;
D. a copy of the~!form of agreement, undertaking
or other instrument proposed to be entered into between
the applicant and each subscriber;
E. a detailed statement setting forth in its
entirety each agreement and undertaking whether formal
or informal, written, oral or implied, existing or
proposed to exist between applicant and any person
which materially relates or pertains to or depends
upon the application and the granting of the franchise;
-54-
(4) A copy of each agreement covering the franchise
area which exists between the applicant and a public
utility subject to regulation by the PUC providing for
the use of facilities of the public utility;
(5) Acceptable evidence of applicant's ability
to obtain the capital necessary to meet the committments
of its service proposal and the requirements of this
chapter, including written commitments from any financial
institution or other outside lending source. City may also
require a statement from a certified public accountant
verifying that Operato~ has sufficient unencumbered
resources to provide that portion of the capital, if any,
that is to be financed by Operator's own resourcest
(6) Any other detail, statement, information or
reference pertinent to the subject matter of the application
which is required or requested by City.
Section 10-1112. Application Fee.
(a) The applicant for a franchise shall pay to City
as an application fee an amount equal to all costs (the
"application cost") actually incurred by City in: obtaining
professional advice and assistance; examining its needs and
interests and in formulating a policy which takes into
account present and prospective developments in cable
television technology; drafting and negotiating this
chapter and franchises which will properly respond to those
needs and interests and, at the same time, take into consid-
eration FCC rules and regulations, economic and fiscal
realities, cable technology and availability of present and
prospective services.
(b) The applicant shall pay $2500 to City at the time
an application is filed. This sum is not returnable. The
amount payable under subsection (a) shall be reduced, for
each person awarded a franchise by the $2500 payment made
under this subsection. The balance for each system shall be
paid in annual installments until paid in full at the time
of payment of the franchise fee specified in section 10-114.
Section 10-1113. Solicitation; Report;~ Criteria.
(a) Solicitation. City may solicit applications for
cable television system franchises and may determine and fix
the date upon which applications must be received by City.
City may make any other determinations and specify any other
times, terms, conditions or limitations respecting the
soliciting, calling for, making and receiving of applications.
(b) Report. Upon receipt of an application for a
franchise City shall refer it to a designated representative
who shall prepare a report and make a recommendation respect-
iing the application to City within 90 days after referral.
(c) Criteria. In making a determination as to an
application City may consider the quality of the service
proposed, rates to subscribers, income to City, experience,
character, background, and financial responsibility of the
applicant and its management and owners, technical and
performance quality of equipment, willingness and ability
to meet construction and physical requirements, and any
other considerations considered pertinent by City for
safeguarding the interests of City and the public. City
may award a franchise on the basis of these considerations
and without competitive bidding.
Section 10-1114. Procedure.
If after public hearing City decides to reject an
application, rejection shall be by resolution and is final
and conclusive.
If City decides to consider granting a franchise to
an applicant it shall:
(1) determine tentative terms and conditions of the
franchise;
(2) adopt resolution of intention to consider the
grant of a franchise. The resolution shall give notice of
receipt of the application, state the name(s) of the proposed
Operator(s), describe the character of the franchise desired,
state conditions upon which the franchise may be obtained,
set a time and place when and where interested persons may
inspect the applications, and state a day, hour, and place
when and where persons having an interest in or objection
to the grant of the franchise may file written protests and
appear before City and be heard. The resolution shall be
published at least once at least 10 days before the hearing
date.
(3) conduct a hearing at the time specified and
proceed to hear and consider all written and oral protests;
-56-
(4) make one of the following determinations:
A. deny the franchise; B. grant the franchise upon
the terms and conditions specified in City's
resolution of intentions; C. grant the franchise
upon other terms and conditions which the Council
deems appropriate.
If City denies the franchise, denial shall be
expressed by resolution. If City grants the franchise,
the grant shall be expressed by ordinance granting a
franchise ~o the applicant. The action of the City
is final and conclusive.
The Operator, within thirty days of receipt of
written notification by the City following franchise
award (upon initial franchise award and any renewal
thereof) shall reimburse City for all expenses
incurred under this chapter in making the franchise
award or renewal beyond those defrayed by application
fees. The City shall furnish the Operator a statement
of such expenses with the notification.
Section 10-1115. Persons Included.
This article applies to every person seeking a cable
franchise in the City, including a person presently operating
a system in the City under an existing license or franchise.
Section 10-1116. Acceptance of the Franchise.
(a) Filing Acceptance; Deadline. A franchise becomes
effective when the Operator files written acceptance with
the City. Written acceptance shall be in the form and
substance approved by City. Written acceptance operates
as an acceptance of each and every term and condition and
limitation contained in this chapter and in the award
agreement.
Operator shall file written acceptance not later
than 12:01 p.m. of the fifteenth day next following the
effective date of the ordinance granting the franchise.
(b) Failure to Accept. Operator's failure to file
written acceptance is a rejection of the franchise. There-
after, City may not receive Operator's acceptance. Operator
has no right, remedy or redress unless City, by resolution,
determines that late acceptance may be received and filed,
and then upon such terms and conditions as City imposes.
-57-
(c) City Rights. Every right and remedy which is
available to City continuously exists in and to City and
may not be modified, abridged, altered, restricted or
impaired.
(d) In Lieu of Other Rights. A franchise granted
and accepted is in lieu of every other right, privilege,
power, immunity, and authority exercisable by Operator,
pertaining to the construction, operation, or maintenance
of a cable television system in the City.
-58-
Article !2
Miscellaneous
Section 10-1121
Section 10-1122
Section 10-1123
Section 10-1124
Section 10-1125
Section 10-1126
Section 10-1127
Notices
Severability
FCC or PUC Jurisdiction: Preemption
Notice to New Subscribers
No Value of Franchise
Most Favored Nation
Violations by Persons Other
Than Operator
Section 10-1121. Notices.
A notice to the~City and reports to be filed with the
City shall be :sent to the City Manager. A notice to Operator
shall be sent to the address provided by him.
Section 10-1122. Severability.
(a) If a provision of this chapter is superseded by a
Federal, State, or other statute, law or regulation, or is
held invalid, all other provisions remain valid, binding and
enforceable. City declares that it would have enacted this
chapter and each section, subsection, subparagraph, sentence,
clause, and phrase irrespective of the fact that one or more
section, subsection, subparagraphs, sentences, clauses or
phrases be declared invalid. The invalidity of a portion of
this chapter does not abate, reduce or otherwise affect the
consideration or other obligation required of Operator.
(b) If a provision of this ordinance determined by the
City as a material provision is held invalid or declared
preempted by Federal or State regulation or law, City shall
negotiate with Operator appropriate modifications to the
franchise to provide reasonable relief from the. invalidity
or preemption. If the parties are unable to reach agreement
on modifications,the dispute shall be submitted to
arbitration under section 10-174. The arbitrators' decision
is binding on the parties, provided that no decision is
of the arbitrator may require the City or Operator to
violate a Federal or State law or regulation.
(c) This chapter and its intended amendments and ,
supplements are enacted upon the belief and premise that it
does not conflict with any applicable law or regulation,
including FCC regulations. If there is or becomes an
inconsistency between any such law or regulation and this
chapter, the law or regulation controls to the extent of
such inconsistency.
Section 10-1123. FCC or PUC Jurisdiction: Preemption.
If the FCC, PUC or other Federal or State body
exercises paramount jurisdiction over the subject matter
of a franchise granted under this chapter, then to the
extent that jurisdiction preempts or precludes the exercise
of jurisdiction by City, the jurisdiction of City ceases.
The preemption or preclusion of the exercise by City
of its police power does not alter or affect any
contractual benefit to City or Operator nor any contractual
obligation of Operator under a franchise issued by City.
Section 10-1124. Notice to New Subscribers.
Before Operator provides cable television service to
a subscriber, Operator shall provide a written notice to
the subscriber substantially as follows:
"Subscriber is hereby notified that in providing
television service the cable operator is making use
of public rights-of-way and that the continued use of
such rights-of-way is in no way guaranteed. If the
continued use of such rights-of-way is denied to the
Operator for any reason, the Operator will make
every reasonable effort to provide service over
alternate routes. By accepting cable television
service, subscriber agrees he will make no claim nor
undertake any action against the City, its officers,
commissions or employees if the service provided is
interrupted or discontinued.
If a dispute between subscriber and the Operator
regarding service or billing problems remains
unresolved, the City has specified procedures for
resolving the dispute (Sections 10-173 and 10-174 of
the Danville Municipal Code). Information concerning
these procedures may be obtained by contacting (name,
location and telephone number of Operator's office)"
-60-
Section 10-1125. No Value of Franchise.
A Court of public or private authority may not
attribute value to a franchise in a proceeding to which
City is a party or by which City is affected.
Section 10-1126. Most Favored Nation.
If Operator also holds or is granted a franchise
("outside franchise") for a cable television system serving
an area ("outside area") outside the City and the cable
system serving the outside area is (for operating purposes)
essentially the same system which serves City, whether or
not the outside area is served by a separate headend, then
Operator shall promptly advise City and shall furnish City
with a copy of the franchise and all amendments to it. City
may (after public hearing with notice and procedure similar
to that followed in awarding a franchise) amend by ordinance
a franchise to include those provisions of the outside
franchise as City elects. However if a provision proposed
to be included directly and substantially affects Operator's
revenues from or cost of operating in the outside area, then
the provision may be included in the franchise only to the
extent that the corresponding operating circumstances in
this franchise area are substantially comparable.
If Operator disagrees with a decision by City to amend
a franchise under this section, he may require that the
matter be settled by arbitration as provided in section 10-174.
Section 10-1127. Violations by Persons Other Than Operator.
(a) Use of Public Streets. After the effective date of
this chapter, it is unlawful for a person to construct, install,
or maintain within a public street in the franchise area, or
within any other public property of City, or within a privately-
owned area within the City which has not yet become a public
street but is designated as a proposed public street on a
tentative subdivision map approved by City, any equipment or
facilities for distributing a television or radio signal
through a cable system, unless a franchise or license under
this chapter is in effect.
(b) Unauthorized Connection to Cable Systems. It is
unlawful for a person to make or use an unauthorized connection,
whether physically, electrically, accoustically, inductively,
or otherwise, with a part of a franchised cable system within
the City for the purpose of enabling himself or others to
receive or use a television signal, radio signal, picture,
program or sound, without payment to the owner of the system.
(c) Tampering with Facilities. It is unlawful for a
person, without the consent of the owner, to willfully
tamper with, remove or damage a cable, wire or equipment
used for distribution of a television signal, radio signal,
picture, program or sound."
SECTION 2. Effective Date.
This ordinance becomes effective 30 days after its
adoption.
SECTION 3. Publication and Posting.
The City Clerk shall either a) have this ordinance
published once within 15 days after adoption in a newspaper
of general circulation or b) have a summary of this
ordinance published twice in a newspaper of general
circulation, once five days before its adoption and again
within 15 days after adoption.
The foregoing ordinance was introduced at a meeting
of the City Council of the City of Danville held on
April 2 , 1984, and was adopted and
ordered published at a meeting of the Council held on
~kpri] ]2 , 1984, by the following vote:
AYES:
NOES: None
ABSENT: None
ABSTAIN: None
Lane, May, Mc Neely, Offenhartz, Schlendorf
ATTEST:
C~TY~LERK
-62-