HomeMy WebLinkAboutC-2890City of
Arcadia
Dominic Lazzaretto
City Manager
240 West Huntington Drive
Post Office Box 60021
Arcadia, CA 91066 -6021
(626) 574 -5401
(626) 446 -5729 Fax
dlazzaretto@ci.arcadia.ca.us
www.ci.arcadia.ca.us
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July 3, 2014
SENT CERTIFIED RETURN RECEIPT
REQUESTED AND U.S. MAIL
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Dwee Haverkate, P rtt ANA CGe2
CBC Broadband Holdings LLC
2702 Media Center Drive
Los Angeles, CA 90065 -1733
Re: Payment of Delinquent Utility User Taxes, Cable Franchise Fees,
and PEG Channel Support Fees
Dear Mr. Haverkate:
As you are aware, CBC Broadband Holdings ( "CBC ") has been delinquent
in remitting the utility user tax (UUT) imposed on CBC Broadband's open
video system (OVS) customers in Arcadia, and has also been delinquent
in remitting the OVS franchise fees and public access (PEG) channel
support fees also owed to the City of Arcadia. CBC is responsible for
collecting these amounts from its customers and remitting them to the City
under applicable provisions of the Arcadia Municipal Code, the Digital
Infrastructure and Video Competition Act of 2006 ( "DIVCA ") and other
applicable law. This is not the first time that CBC has failed to timely
collect and remit these amounts. Rather, CBC has been chronically late
for the past few years. In addition, CBC was seriously delinquent in
making these payments starting in approximately September 2013 CBC's
continued inability to timely collect and remit UUT and franchise and PEG
fees is unacceptable.
Specifically, CBC has failed to remit UUT and franchise and PEG fees for
the period from December 2013 through June 2014. Given the average
monthly payment is $8,200.00' (representing UUT $1,200, franchise fees
$6,000and PEG fees $1,000), CBC is approximately $57,400 behind in
payments. As a courtesy, the City is willing to permit CBC to enter into a
payment plan for the owed amounts as set forth in this Letter Agreement.
In an attempt to reach a solution short of litigation, CBC shall pay two
oldest delinquent months' worth of UUT, franchise fees, PEG fees and
interest (as identified below) each month beginning July 2014 and
continuing until CBC is current on all owed fees and taxes. For example,
in July 2014, CBC shall remit all owed payments for December 2013 and
1 While DIVCA allows CBC to pay franchise and PEG fees quarterly.. CBC has paid proportional
shares of these amounts monthly. By agreeing to this Letter Agreement, CBC agrees to pay the
owed franchise and PEG fees monthly as set forth in this Letter Agreement.
Dave Haverkate
July 3, 2014
Page 2 of 2
January 2014. Similarly, in August 2014, CBC shall remit all owed
payments for February and March 2014. Based on this timetable of
payments, CBC would be up -to -date and back to the regular payment
cycle starting January 2015. Please note that all payments shall be
accompanied with supporting documentation substantiating the owed
amounts.
Despite the fact that CBC is subject to significant late charges and interest
on these delinquent amounts under applicable law, the City is willing to
waive these late charges and interest in exchange for CBC agreeing to
pay one - percent annual interest on the principal and interest balance
compounded monthly. The City's offer to forego late charges and agree to
the above interest amount is an offer to compromise and expressly
contingent on CBC's timely payment of all amounts owed to the City. In
the event CBC makes a single payment late, the City may recover all
applicable late charges and interest that would have been owed but for
this Letter Agreement.
If you agree with the terms of this Letter Agreement, please so indicate by
signing and dating where indicated below. If we do not receive a signed
original of the Letter Agreement by Monday, July 14, 2014, we will assume
that you are not interested in the City's proposal and the City will have no
choice but to commence litigation.
An original, executed copy of this Letter Agreement is enclosed for your
records. By entering into this Letter Agreement, the City of Arcadia does
not waive any right or remedy it may have with respect to noncompliance
by CBC Broadband with any obligation it has pursuant to the Arcadia
Municipal Code and /or applicable law.
CITY Or ARCADIA CBC BROADBAND HOLDINGS LLC
Approved by:
Reviewed and Accepted by:
ominic Lazzaret il;41W K Gave Haverkate
City Manager Pfet�N��2
Date: ��3Ti`F Date: J_ ✓L �yr Zvi `�