HomeMy WebLinkAboutC-2246City of
Arcadia.
October 28, 2010
Mr. Ruben Garcia, President
CBC Broadband Holdings LLC
2702 Media Center Drive
Los Angeles, CA 90065 -1733
el >i tt hI I tM 6 i 4-
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Re: Payment of Delinquent Utility User Taxes, Cable Franchise Fees, and
PEG Channel Support Fees
Office of the Dear Mr. Garcia:
C1tV Attorney' As you are aware, CBC Broadband Holdings has been delinquent in
J remitting the utility user tax (UUT) imposed on CBC Broadband's open video
system (OVS) customers in Arcadia, and has also been delinquent in
Stephen P. Deitsch remitting the OVS franchise fees and public access (PEG) channel support
City Attomey fees also owed to the City of Arcadia. On June 25, 2010, CBC Broadband
entered into a payment plan with the City calling for periodic payments of the
delinquent fees and taxes. The fees and taxes owed for the months of
March and April 2010 were to have been paid in August and September
2010, respectively, but CBC Broadband failed to make these payments.
You have proposed to pay the delinquent amounts owed for March and April
2010 in six equal monthly installments, commencing in October 2010. This
letter will set forth the terms and conditions under which CBC Broadband will
make payment to the City for the delinquent amounts owed, and will be the
agreement between the City and yourself regarding these payments. To the
original delinquent balance of $20,155.74 has been added a 15% penalty for
late remission of UUT revenues, pursuant to Sections 2674 and 2675 of the
Arcadia Municipal. Code, in the amount of $257.35, for a total owed of
$20,413.09. CBC Broadband will make six equal monthly payments of
$3,402.18, with the first payment to be made no later than October 29, 2010,
and subsequent payments to be made on the last day of each succeeding
month.
If you agree with the terms of this Letter of Agreement referenced above,
please sign and date where indicated below. A fully executed copy will be
forwarded to you once the City has signed it. By entering into this Letter of
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.
Sincerely,
0%
Stephen P. Deitsch
City Attorney
240 West Huntington Drive
Post Office Box 60021
Arcadia, CA 91066 -6021
(626) 574 -5407
(626) 446 -2991 Fax
Mr. Garcia
October 28, 2010
Page 2
CITY OF ARCADIA
Approved by.
Donald Penman
City Manager
Dated: t ► 1 4 , 2010
APPROVED AS TO FORM:
Stephen P. Deitsch
City Attorney
CBC BROADBAND HOLDING LLC
Reviewed and Accepted by.
f
Signature
Print Name
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Title
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Date
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ASSIGNMENT AND ASSUMPTION AGREEMENT
OPEN VIDEO SYSTEM FRANCHISE AGREEMENT)
THIS ASSIGNMENT AND ASSUMPTION AGREEMENT ( "Agreement ") is made and
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entered into this � day of btLgh4- � , 2008, by and between Champion
Broadband California, LLC, dba Champion Broadband, a Wyoming limited liability company
( "Assignor "), CBC Broadband Holdings, LLC, a Delaware limited liability company
( "Assignee "), and the City of Arcadia, a California municipal corporation ( "City ").
RECITALS
A. Assignor is the authorized holder of a franchise that authorizes the construction,
operation, and maintenance of an open video system within the City of Arcadia, California (the
"Franchise "). Assignor's open video system franchise will expire by its terms on December 6,
2015.
B. Subject to the prior consent of the City, Assignor desires to assign and transfer to
Assignee, and Assignee desires to assume, all rights and obligations under the Franchise.
THE PARTIES AGREE AS FOLLOWS:
1. Assignor assigns and transfers to Assignee all of Assignor's rights, duties, and
obligations under the Franchise.
2. Assignee covenants and agrees with Assignor and with the City to assume all
rights and to assume and perform all obligations of the Assignor under the Franchise.
3. The City hereby consents to the transfer and assignment by Assignor to Assignee
of all rights, duties, and obligations specified in the Franchise.
TO EFFECTUATE THIS AGREEMENT, the parties hereto have caused this Assignment
and Assumption Agreement to be executed by their duly authorized representatives as of the
latest date set forth below:
ASSIGNOR
CHAMPION
LLC dba C
a Wyoming
By:
Title:
CALIFORNIA,
company
Date: .�,� Z/ 2M �z
By:
Title:
Date:
APPROVED A TO FORM
Legal Co sel
CITY OF ARCADIA
By: aIIria��`r�..+ -n �.
Donald Penman, City Manager
Date: 4A-4J.%4
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ASSIGNEE
CBC BROADBAND HOLDINGS, LLC
a Delaware limited liability company
By:
Title: PR-051 ryet pi �o
Date: 12- -19 —bK
By: Ou� k�e"
Titl . ,X
Date:
APPROVED AS TO FORM
Legal Counsel
APPROVED AS TO FORM
Stephen P. Deitsch, City Attorney
OPEN VIDEO SYSTEM AGREEMENT
THIS OPEN VIDEO SYSTEM AGREEMENT ( "Agreement ") is entered into this
day of A r 2006, at Arcadia, California, by the City of Arcadia, a municipal
corporation of the State of California ( "Grantor "), and Champion Broadband California, LLC, a
Wyoming limited liability company ( "Grantee ").
RECITALS
A. In enacting the Telecommunications Act of 1996, Congress sought to
introduce competition into the market for video programming delivery. Section 653 of the 1996
Act (47 U.S.C. §573) created a new method for entry into that market, which is known as the
open video system ( "OVS "). Section 653 distinguishes OVS operators from common carriers of
video programming and traditional cable operators. Unlike common carriers, OVS operators
may select some of the video programming transmitted over their systems; but, unlike cable
operators, OVS operators must make most of the channel capacity on their systems available to
unaffiliated video programming providers on a nondiscriminatory basis. [47 U.S.C.
§573(b)(1)(A).] If demand for OVS channel capacity exceeds supply, an OVS operator may
select programming for no more than one -third of the system's channel capacity. [47 U.S.C.
§573(b)(1)(B).]
B. In August 2001, a franchise agreement became effective that had been
entered into between Grantor and Altrio Communications, Inc., a Delaware corporation
( "Altrio "). This agreement authorized the construction, operation, and maintenance of a cable
system within the City of Arcadia.
C. Commencing in September 2003 and continuing through March 2004,
Altrio defaulted in its contractual obligations to Grantor, including Altrio's obligations to pay
franchisee fees, community connectivity contributions, PEG fees and other documented costs
and expenses that had accrued during Altrio's construction and operation of the cable system.
D. On March 26, 2004, Altrio, as seller, and Grantee, as buyer, consummated
an asset purchase and sale transaction that involved the execution of an Asset Purchase
Agreement, a Convertible Note, an Option Agreement, and a Security Agreement. Prior to the
consummation of this transaction, neither Altrio nor Grantee formally requested Grantor's prior
written consent as required by Altrio's franchise agreement with Grantor and by Grantor's
regulatory ordinance, although Grantee gave verbal notice of the proposed transaction to the City
manager and Special Assistant to the City Manager.
E. Since March 26, 2004, Grantee has operated the cable system that was
previously constructed by Altrio, and Grantee has paid to Grantor, on a going - forward basis,
franchise fees, community connectivity contributions, and PEG fees that were required to be paid
under the provisions of Grantor's franchise agreement with Altrio. No payments have been made
by Grantee to Grantor of any amounts that had accrued but were unpaid during Altrio's operation
of the open video system prior to March 26, 2004.
F. On February 28, 2005, Grantee filed with the FCC's Cable Services
Bureau an FCC Form 1275, titled "Certification for Open Video System." That certification
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application was approved by the FCC on March 10, 2005, and Grantee was authorized to operate
an open video system in specified communities within Southern California, including the City of
Arcadia.
G. On May 5, 2005, Grantee submitted to Grantor an application for an open
video system. This application substantially addressed the items of information required by
Grantor's regulatory ordinance, Ordinance No. 2206 (the "OVS Ordinance "). Supplemental
information was requested by Grantor and provided by Grantee.
H. In connection with Grantee's application to construct additional facilities
in the future and to operate an open video system, Grantee has offered to (i) continue to provide
certain services to Grantor, including public, educational, and governmental access channels; and
(ii) continue to pay to Grantor a percentage of the revenues that it receives from the provision of
open video system services to its subscribers in the City.
I. In accordance with the City's charter, the Arcadia Municipal Code, the
OVS Ordinance, California Government Code Section 53066, and the Cable Communications
Policy Act of 1984, as amended (47 United States Code Sections 521 et seq.), Grantor is
authorized to enter into an agreement for the construction, operation, and maintenance of an open
video system within the City of Arcadia.
J. Grantor and Grantee have negotiated the terms of this Agreement, which
are set forth below, in accordance with applicable law, and Grantee has agreed to comply with
the provisions of this Agreement and the OVS Ordinance, as it exists as of the date of this
Agreement. A copy of the OVS Ordinance is attached as Exhibit A and is incorporated by this
reference.
K. Grantor's City Council has reviewed the present and future cable- related
needs of the City and its residents, and Grantee's financial, legal, and technical qualifications to
perform its obligations under this Agreement, and has determined following a noticed public
hearing that the public interest would be served by authorizing Grantee to construct additional
facilities and to operate an open video system subject to the terms of this Agreement and the
provisions of the OVS Ordinance.
NOW, THEREFORE, in accordance with the provisions of the OVS Ordinance
and this Agreement, Grantor grants to Grantee, and Grantee accepts from Grantor, nonexclusive
rights to construct additional facilities in the future and to operate an open video system.
PARTIES; NOTICES; RIGHTS AND AUTHORITY GRANTED.
1.1. Parties to the Agreement
(a) Grantor: The City of Arcadia, a municipal corporation, having its
principal office at 240 West Huntington Drive, Arcadia, California 91066.
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(b) Grantee: Champion Broadband California, LLC, a Wyoming limited
liability company, with ownership as set forth in the attached Exhibit B that is incorporated by
this reference, and having a local office at 911 Primrose Avenue, Monrovia, California 91016.
1.2. Representatives of the Parties and Service of Notices. The representatives of the
parties who are primarily responsible for the administration of this Agreement, and to whom
notices, requests, demands and other communications must be given, are as follows: .
(a) The principal representative of Grantor is:
City Manager
Arcadia City Hall
240 West Huntington Drive
Arcadia, California 91066
(b) The principal representative of Grantee is:
Chief Executive Officer
Champion Broadband California, LLC
911 Primrose Avenue
Monrovia, California 91016
(c) Notices, requests, demands, and other communications to be given by
either party must be in writing and may be effected by personal delivery, by overnight courier,
by first class mail, or by certified mail, return receipt requested.
(d) If the name or title of the principal representative or other recipients
designated to receive the notices, requests, demands, and other communications, or the address
of those persons, is changed, written notice must be given at least five working days before the
effective date of that change.
1.3. Definitions. The words, terms, and phrases and their derivations used in this
Agreement shall have the meanings set forth below in Section 14.
1.4. Conflicts. If there is any conflict or inconsistency between the provisions of this
Agreement and the provisions of the OVS Ordinance, the provisions of this Agreement will
control.
1.5. Grant. This Agreement confers upon Grantee the authority, right, and privilege to
construct, operate, and maintain an open video system in the "designated service area," which is
here defined as the territorial limits of the City of Arcadia as they exist on the effective date of
this Agreement, and any additional territory that may be annexed during the tern of this
Agreement. Grantee's construction of any extension of the open video system facilities within
the designated service area will be in compliance with the provisions of Section 7 of this
Agreement.
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1.6. Effective Date. This Agreement will commence on the effective date of the
resolution authorizing this Agreement, or on the date specified as the effective date in that
resolution. On or prior to its effective date, Grantee must file with the City Clerk a written
acceptance of the resolution approving this Agreement. That acceptance may be in the form of
Grantee's signature on the face of the resolution. Prior to the effective date of this Agreement,
Grantee must file with the City Clerk any required security deposits, performance bonds, and
insurance policies or insurance certificates. If the filing of these documents does not occur prior
to the effective date of this Agreement, or within any authorized extension of that filing deadline,
Grantor may declare this Agreement to be null and void.
1.7. Duration. The term of this Agreement is ten (10) years from the effective date as
specified in Section 1.6. Renewal of the Agreement, if any, will be in accordance with then
applicable law.
1.8. Agreement Not Exclusive. The rights granted by this Agreement may not be
construed to limit in any manner the Grantor's right, through its authorized officers and in
accordance with applicable law, to grant to other individuals or entities, by franchise, permit,
license, or otherwise, any rights, privileges or authority similar to or different from the rights,
privileges and authority herein set forth, in the same or other streets, public ways, public places,
or other property that Grantee is entitled to occupy; provided, however, that those additional
grants will not operate to revoke, terminate, or materially and adversely affect any rights granted
to Grantee by this Agreement.
1.9. Scone of the Agreement.
(a) Subject to Grantee's compliance with Grantor's permit procedures
applicable to construction, encroachments, excavations, and pole attachments, Grantee is
authorized to construct, reconstruct, operate, and maintain its open video system within the
public streets and rights -of -way.
(b) The authority granted by this Agreement includes the privilege to use
Grantee's open video system in the designated service area for the provision of both open video
system service and for the provision of such other services as are or may be authorized by
applicable law. During the term of this Agreement, Grantee acknowledges that it is obligated to
use its open video system to provide cable service, which includes video programming that will
be provided to multiple subscribers within the designated service area.
(c) Grantor reserves all rights it now has or subsequently acquires with
respect to the future authorization and regulation of non -cable services, including, but not limited
to, the right to impose reasonable terms and conditions in addition to or different from those set
forth in this Agreement with respect to the provision of any non -cable services, and to charge a
fee or other form of consideration or compensation on those non -cable services in lieu of that
specified herein; provided that those terms and conditions and that fee or other form of
consideration or compensation must not be in conflict with federal and state law applicable to
non -cable services; and provided further, that Grantor and Grantee will in good faith negotiate an
agreement as to those terms and conditions and that fee or other form of consideration or
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compensation. Grantee reserves all rights it now has or may subsequently acquire with respect to
the provision of non -cable services and does not waive any rights it may have to provide those
services.
(d) Grantor acknowledges that Grantee intends to offer to its subscribers
various residential communications services, including certain non -cable services that, upon the
effective date of this Agreement, are not subject to regulation by Grantor. Before offering or
distributing on a commercial basis any new non -cable services to subscribers within the
designated service area, Grantee will, as an accommodation to Grantor, use all reasonable efforts
to provide advance written notice to Grantor of its intent to offer or distribute such non -cable
services and a description of those services. Such notice confers no jurisdiction or authority
upon Grantor to regulate non -cable services.
(e) Grantor reserves all rights it now has or subsequently acquires to impose
conditions regarding access by unaffiliated third parties to Grantee's open video system platform
for the delivery of high -speed Internet access services. Prior to the enactment or enforcement of
any such conditions, Grantee will be provided with reasonable notice, an opportunity to be heard,
and an opportunity to present evidence on any findings made or required to be made with respect
to those conditions.
(f) Grantor and Grantee expressly reserve the right to seek a judicial
determination on whether any particular service offered by Grantee on its system constitutes
cable service for purposes of this Agreement.
1.10. Applicability of Government Code Section 53066.3. Government Code Section
53066.3, sometimes referred to as the "level playing field statute," requires a noticed public
hearing prior to the grant of "an additional cable television franchise in an area where a franchise
has already been granted to a cable television operator." Grantor and Grantee acknowledge and
agree that the noticed public hearing referenced in paragraph (K) of the Recitals was conducted
by Grantor to satisfy the requirements of Government Code Section 53066.3, which may or may
not be applicable to the grant of an open video system franchise. In the absence of legal
authority that addresses the applicability of Government Code Section 53066.3 to open video
system franchises, the parties have followed the provisions of that statute in negotiating this
Agreement and in conducting the noticed public hearing. Under these circumstances, voluntary
compliance with Government Code Section 53066.3 is deemed to serve the best interests of the
parties and of the general public, and such voluntary compliance will not preclude Grantee from
later requesting that its open video system franchise be converted to a cable television franchise;
provided, however, that any such conversion will be conditioned upon Grantee's payment of
Grantor's costs and expenses incurred in reviewing and processing the requested conversion and
upon Grantee's compliance with all statutes and regulations that apply to cable television
operators, including those relating to institutional networks.
2. GENERAL REQUIREMENTS
2.1. Governing Requirements. Grantee must comply with all provisions of this
Agreement, the provisions of the OVS Ordinance as it exists on the effective date of this
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Agreement (except as it may be inconsistent with this Agreement), and all other applicable
federal, state, and local laws, ordinances, and regulations.
2.2. Fee on Gross Annual Revenue.
(a) As compensation for the rights granted by this Agreement, and in
consideration for Grantor's authorization to use its streets and public ways for the construction,
operation, and maintenance of Grantee's open video system, Grantee will pay to Grantor a fee of
five percent (5%) of its gross annual revenue, as defined in Section 14 of this Agreement,
received by Grantee from the operation of the open video system in Grantee's designated service
area, or such lower percentage as the incumbent cable television operator is required to pay in
the form of franchise fees. Grantee covenants and agrees with Grantor that no fees on non-
subscriber- related gross revenues, such as those derived from advertising sales and the sale of
products or services on home shopping channels, will be passed through to Grantee's subscribers
on their monthly billing statements.
(b) Grantor acknowledges that, during the term of this Agreement, Grantee
may offer to its subscribers, at a discounted rate, a bundled or combined package of services
consisting of cable services, which are subject to the fee referenced above in paragraph (a), and
other services that are not subject to that fee. With regard to such bundled or combined services,
the following provisions are applicable:
1. During the term of this Agreement, if Grantee, or any of its Affiliates,
bundles or combines the sale of some or all of its cable services with non -cable services, and it
becomes necessary to separately compute the amount of gross annual revenue attributable to
cable services in order to determine the amount of fees or PEG access support fees that are
payable to Grantor, then the following methodology will be applied:
Grantee must calculate and report gross annual revenue, the fees thereon,
and any applicable PEG access support fees, based upon proportionality, i.e., the amount of gross
revenue to be attributed to each of such services must be in the same proportion that the price of
each service, as determined on a stand -alone basis, bears to the aggregate of the stand -alone
prices for those services when purchased on an unbundled basis.
2. Grantee will not structure the pricing of any bundled or combined
services to intentionally or unreasonably cause a reduction in the gross annual revenue against
which franchise fees or other proportionately- derived taxes or fees may be imposed by Grantor.
3. If Grantor reasonably determines that Grantee has unlawfully,
inequitably, or contrary to this paragraph (b) allocated gross annual revenue between cable
services and non -cable services in calculating franchise fee payments, then the parties will meet
upon advance notice from Grantor to discuss the allocation methodology. If the parties cannot
resolve the dispute within a reasonable period of time, then the parties will submit the matter to a
mutually - agreeable third party for mediation. The cost of the mediation will be shared equally
by the parties. If the mediation is not successful, or if the parties cannot mutually agree upon a
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mediator, then either party may file an action in a court of competent jurisdiction or pursue any
other remedies available under the law or this Agreement.
4. In recognition of the regulatory uncertainties that exist on the effective
date of this Agreement with regard to bundled services that are offered at a discount, the parties
reserve all rights, claims, defenses, and remedies they may have relating to Grantor's authority to
impose and to enforce requirements concerning the revenue allocation methodology to be
applied in calculating franchise fee payments on gross annual revenue that is derived from the
sale to subscribers of cable services and non -cable services in a discounted package.
(c) The fee specified above in paragraph (a) must be computed and paid by
Grantee to Grantor's Finance Department not later than 30 days after the end of each calendar
month. The payment must be accompanied by a report that contains the following information
relating to the preceding calendar month:
1. _ The total gross revenue collected by Grantee, and an itemization of the
various categories of gross revenue collected during that calendar month.
2. The methodology used by Grantee in determining any proration of
revenues, such as those derived from advertising sales and home shopping commissions, among
Grantor and other local franchising authorities that are within Grantee's regional cluster.
3. The percentage of subscribers within the designated service area as
compared to the total number of subscribers served by Grantee's headend, and such related
information concerning those subscribers as may be required by Grantor to verify and validate
Grantee's calculations concerning the proration of revenues, such as those derived from
advertising sales and home shopping commissions, among Grantor and other local franchising
authorities served by Grantee.
(d) Grantor acknowledges Grantee's desire to treat its subscriber counts as
proprietary and confidential information in a competitive video and telecommunications market.
Consequently, Grantor will not require Grantee to submit subscriber counts in connection with
the monthly reports that accompany the payment of franchise fees; provided, however, that
Grantee will, upon Grantor's request, make such proprietary and confidential information
relating to subscriber accounts available for inspection by Grantor's authorized representatives
for the purpose of verifying the accuracy of franchise fee payments made to Grantor. To the
extent authorized by law, Grantor will maintain the confidentiality of that proprietary
information.
(e) If the payment of any fee on Grantee's gross annual revenue, or any
recomputed amount of such fee, is not made on or before the dates specified in Subsections 2.2
or 2.3, Grantee must pay to Grantor as additional compensation an interest charge, computed
from the applicable due date, at a rate equal to one percent per month, or twelve (12) percent per
annum.
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(0 In addition to the interest charge on a late payment that is imposed in
accordance with paragraph (e) above, if a payment continues to be delinquent for a period of ten
(10) days following expiration of the time for cure of this default, as specified in Subsection
11.1(a), Grantor may treat that delay as a material breach, subject to all applicable provisions of
Section 11 of this Agreement.
(g) Grantee acknowledges its obligation to pay the fee specified above in
paragraph (a), which is the maximum percentage amount authorized by 47 U.S.C. §573 (c)(2)(B)
of the Cable Communications Policy Act of 1984, as amended. If Congress, the FCC, or a court
of competent jurisdiction alters this fee requirement in a manner that materially changes the
benefits or obligations of either party, then the parties agree to comply with the requirements of
applicable law.
2.3. Payment to Grantor.
(a) No acceptance of any payment by Grantor may be construed as an accord
that the amount is in fact the correct amount, nor may acceptance of payment be construed as a
release of any claim Grantor may have against Grantee for any additional sums payable under
the provisions of this Agreement.
(b) All amounts paid are subject to independent audit and recomputation by
Grantor, as provided for in Subsection 9.9.
2.4. Insurance Requirements.
(a) Upon the effective date of this Agreement, Grantee, at its sole cost and
expense, must obtain, and thereafter maintain for the full term of this Agreement, all of the
following insurance coverages:
1. Types of Insurance and Minimum Limits. The coverages required
below may be satisfied by any combination of primary liability and excess liability policies.
A. Workers' Compensation and Employer's Liability
Insurance in conformance with the laws of the State of California.
B. Grantee's vehicles, including owned, leased, or hired
vehicles, must each be covered with Automobile Liability Insurance in the minimum amount of
$3,000,000 aggregate for bodily injury and property damage.
C. Grantee must obtain and maintain Comprehensive or
Commercial General Liability Insurance coverage in the aggregate annual amount of $3,000,000
aggregate, including bodily injury, personal injury, and broad form property damage. This
insurance coverage must include, without limitation, contractual liability coverage adequate to
meet Grantee's indemnification obligations under this Agreement.
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2. All required Automobile Liability Insurance and Comprehensive or
Commercial General Liability Insurance policies must contain an endorsement in substance as
follows:
"The City of Arcadia, its officials, officers and employees are added as
additional insureds as respects the operations of the named insured under
the Open Video System Franchise Agreement entered into by the City and
the named insured."
3. The insurance required of Grantee under this franchise is primary, and
no insurance held by Grantor may be called upon to contribute to a loss under this coverage.
4. All insurance policies must provide that, in the event of material
change, reduction, cancellation, or non - renewal by the insurance carrier for any reason, not less
than thirty (30) days' written notice will be given to Grantor by registered mail of such intent to
cancel, materially change, reduce, or not renew the coverage. An authorized agent of the
insurance carrier must provide to Grantor, on such schedule as is requested by Grantor, a
certification that all insurance premiums have been paid and all coverages are in force. If for any
reason Grantee fails to obtain or keep any of the insurance in force, Grantor may obtain that
insurance. In that event, Grantee must promptly reimburse Grantor its premium costs, plus one
percent (I%) monthly interest thereon until paid.
5. All insurance must be obtained from companies that are licensed to
transact business in California and that have a rating of A -VII or better in Best's Insurance
Guide.
6. The deductibles or self - insured retentions are subject to Grantor's prior
approval, which approval will not be unreasonably withheld.
(b) Prior to the effective date of this Agreement, Grantee must provide to
Grantor written insurance binders, statements of property coverage, certificates of insurance, or
certified copies of policies evidencing the required coverage.
(c) Upon Grantor's request, Grantor and Grantee will confer in good faith
concerning an increase in the types, amount or limits of insurance coverage specified above, but
such negotiations will occur no more often than every three (3) years during the term of this
Agreement. Any such increase will be determined by reference to Grantor's then - existing risk
management policies and procedures.
2.5. Security for Grantee's Performance.
(a) Security Deposit for Construction. The parties contemplate that any future
construction of additional open video system facilities within the City will be undertaken in
discrete phases. In conjunction with Grantee's application for a permit authorizing construction
of additional open video system facilities within any discrete phase of the work, Grantee must
provide a cash security deposit. The cash deposit must be in a principal sum that is reasonably
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specified by Grantor; provided, however, that the amount of the cash deposit for any discrete
phase of the work may not exceed the amount of the bid price received from Grantee's prime
contractor for the construction work to be undertaken in that phase. The cash deposit will secure
Grantee's faithful performance of certain obligations under the construction permit and this
Agreement, including payment of Grantor's inspection fees and administrative costs related to
construction. The cash deposit will also secure payment for emergency repairs to public
improvements that may be damaged in the course of Grantee's construction activities, and will
ensure that, upon any abandonment or other permanent cessation or termination of the
construction work, Grantor's streets, highways, and public rights- of-way will be restored to the
condition existing prior to Grantee's construction work. Completion of any phase of the work
will be deemed to have occurred when that phase has become operational, signals have been
activated, and proof of performance tests have been completed that demonstrate compliance with
all applicable FCC technical standards. The cash deposit for a completed phase of the work will
be released upon Grantor's acceptance of proof of performance tests, which acceptance will not
be unreasonably withheld. Unless otherwise agreed to by Grantor's Public Works Director, a
new cash deposit must be provided by Grantee in conjunction with each successive phase of the
work that is authorized by a separate permit.
(b) Security Deposit for Other Obligations. Prior to the effective date of this
Agreement, Grantee must provide to Grantor a cash security deposit to guarantee Grantee's
performance of its obligations under this Agreement, excluding those obligations relating to
construction referenced above in paragraph (a). The initial security deposit will be in the sum of
$110,000 within fifteen (15) days following the adoption of the resolution approving this
Agreement, of which amount $13,050 previously deposited by Altrio will be credited to
Grantee's initial security deposit. Upon expiration of this Agreement, if Grantee is not then in
default of its obligations, the security deposit will be released. The security deposit will be
subject to and in compliance with the following requirements:
1. The security deposit will be available to Grantor to secure and to
satisfy any and all claims, penalties, fines, liens, fees, payments, costs, damages, or taxes due
Grantor from Grantee that arise by reason of the operation of the open video system.
2. After all applicable notice, hearing, and appeal requirements specified
in Section 11 of this Agreement have been satisfied, if Grantee fails or refuses to pay to Grantor
any amounts due under the terms and provisions of this Agreement, Grantor may thereafter
withdraw from the security deposit the unpaid amount, plus accrued interest and penalties.
3. Within forty five (45) days after Grantee's receipt of written notice
from Grantor that any amount has been withdrawn by Grantor from the security deposit in
satisfaction of any of Grantee's obligations specified above in subsection (1), Grantee must
restore the security deposit to the amount that is then required by this Agreement.
4. The rights reserved to the Grantor with respect to this security deposit
are in addition to all other rights of Grantor under this Agreement, including Grantor's rights
under the security deposit for construction referenced above in paragraph (a).
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(c) Adjustments. Upon Grantor's request, Grantor and Grantee will confer in
good faith concerning any proposed increase in the principal amount of the performance bond
specified above in paragraph (b) no more often than every three years during the term of the
franchise. Any such increase will take into consideration Grantor's then - existing risk
management policies and procedures.
2.6. Affirmative Action; Fair Employment Practices
(a) During the term of this Agreement, Grantee must comply with all
applicable federal, state, and local laws and regulations relating to fair employment practices.
(b) Grantee represents that, during the term of this Agreement, Grantee and
any parties with whom it may contract will adhere to equal opportunity employment practices to
ensure that applicants and employees are treated equally and are not discriminated against
because of their race, religious creed, color, national origin, ancestry, handicap, sex, or age.
Grantee further represents that it will not maintain any segregated facilities in violation of
applicable law.
3. RIGHTS RESERVED TO THE GRANTOR.
3.1. Reservation. Grantor reserves every right it may have in relation to its power of
eminent domain over Grantee's contractual rights and property.
3.2. Delegation of Powers. Unless otherwise provided in this Agreement, and except
with regard to the grant, transfer, termination, revocation, or forfeiture of the Agreement, any
right or power in, or duty retained by or imposed upon Grantor, or any officer, employee,
department, commission, or board of Grantor, may be delegated by Grantor to any officer,
employee, department or board of Grantor, or to such other person or entity as Grantor may
designate to act on its behalf.
3.3. Right to Inspect Construction. Grantor has the right to inspect all construction,
installation, or other work performed by Grantee in connection with the Agreement, and to make
such tests as may be necessary to ensure compliance with the terms of this Agreement, so long as
that inspection and testing does not unreasonably interfere with Grantee's operations.
3.4. Right to Require Removal of Property. Consistent with applicable law, at the
expiration of the term of the Agreement, or upon its lawful revocation or termination, Grantor
has the right to require Grantee to remove, within a reasonable period of time that will not be less
than one hundred eighty (180) days, and at Grantee's expense, all portions of its open video
system and any other property from all streets and public rights -of -way within the designated
service area.
3.5. Right of Intervention. Grantor has the right to intervene in any suit, proceeding,
or other judicial or administrative proceeding in which Grantor has any material interest, and to
which Grantee is made a party.
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3.6. Option to Acquire the Oven Video System and Infrastructure.
(a) Following the termination or expiration of this Agreement, if Grantee
enters into an agreement that involves the proposed sale or other disposition of the open video
system, then Grantor will have the right to acquire the open video system in accordance with the
following procedures:
1. Within thirty (30) days after execution of an agreement of the nature
referenced above in paragraph (a), Grantee must provide a complete copy to Grantor. Grantor
will have the right to acquire the open video system in accordance with the terms and provisions
of that agreement, except that no value will be assigned to the agreement itself. Grantor may
exercise that right by submitting to Grantee, within ninety (90) days after receipt of a copy of the
agreement, a written notice of Grantor's intent to acquire the open video system. If Grantor does
not so notify Grantee, then the open video system may be sold or otherwise disposed of by
Grantee on the terms set forth in the agreement.
2. If any material change is made in the agreement after it has been
provided by Grantee to Grantor, then the agreement as modified must again be submitted to
Grantor, and Grantor will again have ninety (90) days to exercise its right to acquire the open
video system, as provided above in subsection (1).
3. If the open video system is not acquired from Grantee on the terms set
forth in the original agreement, or in the modified agreement, as may be applicable, then the
right of Grantor to acquire the open video system will continue, and notice of all subsequent
agreements must be given to Grantor in accordance with this paragraph (a). Grantor's right to
acquire the open video system in accordance with this paragraph (a) will survive every
acquisition by a transferee during the term of this Agreement and will be binding upon that
transferee.
(b) If Grantor denies an application for renewal of this Agreement, or if this
Agreement expires or is terminated, or if Grantee abandons or deactivates its open video system
infrastructure, then Grantor will have the option to purchase from Grantee at fair market value
the open video system infrastructure. This option to purchase may be exercised in accordance
with the following procedures:
1. The option must be exercised by Grantor within sixty (60) days after
the decision is made by Grantor not to renew the Agreement, or within sixty (60) days after the
expiration or termination of this Agreement, or within 60 days after Grantee's abandonment or
deactivation of its open video system infrastructure.
2. Grantor's option to purchase the open video system infrastructure, as
provided for in this Subsection 3.6(b), is for the purpose of ensuring the continuity of vital
telecommunications services in the event of nonrenewal, expiration, or termination of this
Agreement, or the abandonment or deactivation by Grantee of its open video system
infrastructure.
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4. SYSTEM CONSTRUCTION AND SPECIAL SERVICES.
4.1. System Construction. A map of Grantee's designated service area and of existing
facilities is attached as Exhibit H.
4.2. Notices Relating to System Construction.
(a) Notices to Local Newspaper. If requested by Grantor, Grantee must
publish a notice in a newspaper of general circulation before commencing construction of any
new facilities to extend the open video system. The notice must be published not less than thirty
(30) days prior to construction. The notice must provide a general summary of the proposed
construction, and a telephone number that the public may call for additional information.
(b) Other Notices,
1. Grantee will provide to Grantor at least forty five (45) days prior
written notice before commencing construction of new facilities to extend the open video system.
2. At least ninety six (96) hours prior to the scheduled construction date,
Grantee must provide additional notice to residents within the proposed construction area by the
use of door hangers that set forth a general description of the construction project, the anticipated
dates of construction, and a telephone number for Grantee that a resident may call with any
questions or concerns. If driveways are to be blocked, additional notice must be given by
Grantee to affected residents, as required by Subsection 7.15(g), which notice must specify the
dates that access will be blocked.
4.3. Services for Public. Educational and Community Facilities.
(a) Upon activation of Grantee's open video system in any discrete
construction phase, and within one hundred twenty (120) days after Grantor's written request,
Grantee will install, maintain, and repair, without charge, at a point of demarcation to be
specified by Grantor, one cable drop at each of the public, educational and community facilities
that is within that discrete construction phase and identified in Exhibit D.
(b) Grantee will provide, without charge, basic and expanded cable service to
one outlet at each of the public, educational and community facilities identified in Exhibit D.
The parties agree that reasonable substitutions of locations identified in Exhibit D may be
required from time -to -time, and those substitutions may be negotiated in a manner that is
mutually beneficial to the parties.
(c) Upon Grantor's written request, Grantee will also install additional drops
and outlets for video services at specified public, educational and community facilities that are
supported by local government funds. Grantor will pay Grantee for these additional drops and
outlets at Grantee's cost for labor and materials.
(d) Grantor will inform Grantee of the construction of new public,
educational, and community facilities so that exterior and interior connections and cable drops
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can be installed by Grantee at the time of construction in order to minimize costs. One cable
drop will be installed by Grantee without cost to Grantor, provided that the new facility requires
no more than a standard one hundred fifty (150) foot aerial drop line from the main feeder line.
Grantor will pay Grantee for additional drops, connections, outlets, and construction costs at
these new facilities at Grantee's cost for labor and materials.
(e) All new drops and outlets requested by Grantor under this Subsection 4.3
must be installed as Grantee's phased construction of its open video system passes each specified
public, educational and community facility.
4.4. Emergency Alert Capability.
(a) Grantee's open video system must comply with all FCC rules and
regulations relating to the national Emergency Alert System ( "EAS "). To the extent that it is
technically feasible and authorized by law, Grantee will provide the system with emergency
override capability to enable Grantor's public safety personnel and designated public officials to
cablecast emergency messages by interrupting and overriding the audio signals of all cable
channels using remote coded - access activation devices at one or more sites to be mutually agreed
upon by the parties. Equipment providing for this emergency override capability will be
installed by Grantee at these sites, at no expense to Grantor.
(b) In the event of any conflict between the federally- mandated Emergency
Alert System ( "EAS ") and the requirements of Grantor's emergency override system, the
federally- mandated EAS will have priority.
4.5. Parental Control Devices.
(a) Grantee must provide subscribers upon request with a "trap," "lockbox,"
digital code, or similar parental control device that enables a subscriber to block the reception of
video and audio signals from selected channels on the open video system, including any
premium or pay - per -view channel that is scrambled.
(b) No additional, continuing charge for the use of any parental control device
may be imposed by Grantee if that device is incorporated into equipment, such as a decoder, for
which a subscriber is already paying a charge.
(c) Upon request, Grantee must provide to subscribers written instructions on
the methods by which selected channels on the open video system may be restricted or blocked.
4.6. Technical Standards.
(a) The FCC Rules and Regulations, including Part 76, Subpart K (Technical
Standards), and any amendments or supplements thereto, will apply to Grantee's operations to
the extent permitted by applicable law.
(b) Grantor's obligations relating to the provision of emergency power for the
open video system include the following:
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1. Grantee must provide standby emergency power equipment for its
headend and for its fiber optic equipment transmitters and receivers, regardless of whether that
fiber optic equipment is located at the headend or in the trunk or distribution system of Grantee's
plant.
2. Grantee's obligation to provide a standby emergency power supply
includes the installation of equipment that cuts in automatically during a utility power failure and
reverts automatically to commercial power when it is restored. Backup power supplies and
associated equipment must be tested on a regular basis. Test results must be recorded in logs that
are available upon request for inspection by Grantor.
3. All standby emergency power equipment will be installed, activated,
and maintained by Grantee at its sole expense and, during a commercial power interruption, must
be capable, at a minimum, of powering the open video system as follows: for plant amplifiers,
not less than one and one -half hours; for nodes, a period of time that is consistent with acceptable
industry standards; and for headend and hub, twelve (12) hours.
4. When one or more commercial power outages exceed a cumulative
total of twenty four (24) or more hours during any twelve (12) month period in areas other than
those where power is not available to residential subscribers, Grantee and Grantor will meet and
confer for the purpose of developing a plan to reduce outage time below twenty four (24) hours.
(c) The open video system must be designed, installed, and operated to
comply with the following general requirements:
1. Twenty four (24) hour daily operation.
2. Avoid causing interference with the reception of off -the -air signals by
non - subscribers.
3. Operate in a wide range of outdoor temperatures that typically occur
within the designated service area.
4. Assure that all subscribers will receive standard color and
monochrome signals on the FCC - designated Class 1 channels without noticeable picture
degradation or visible evidence of color distortion, or other forms of interference that may be
attributable to deficiencies in the open video system.
4.7. No Offset Against Fees. In accepting this Agreement, Grantee acknowledges that
the costs of the commitments specified in this Section 4 will not be offset against any fees
payable by Grantee to Grantor during the term of this Agreement.
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5. SERVICES. PROGRAMMING, AND CONSUMER PROTECTION STANDARDS.
5.1. Rates and Charges for Services and Equipment.
(a) Grantor acknowledges that federal law precludes Grantor's regulation of
Grantee's rates and charges for open video system services and equipment.
(b) Prior to the effective date of this Agreement, Grantee must submit to
Grantor's City Manager a complete list of services and open video system programming
packages offered by Grantee in the designated service area, and the rates and charges for
services, equipment, and programming that are then being offered.
5.2. Discounts for Low- Income Persons. Grantee must offer to qualified low- income
residents a discount on subscriptions to the basic analog service tier of video programming
offered on the open video system. This discount will be no less favorable to qualified low -
income residents than the discount offered by the current franchised cable operator and may be
calculated in the same manner.
5.3. Consumer Protection and Service Standards. Except as otherwise provided in this
Agreement, Grantee must comply with all applicable local, state, and federal laws, ordinances,
and regulations relating to consumer protection and service standards that are referenced in
Exhibit E.
5.4. Broad Categories of Cable Services.
(a) Grantee must provide, at a minimum, the following broad categories of
programming: local broadcast stations; news; cultural programming; classic, foreign, and special
interest films; contemporary movies; general entertainment; sports programming; documentaries;
PEG access channel programming; children's programming; and foreign language programming.
(b) If any broad category of programming listed above in paragraph (a)
becomes unavailable, or cannot be provided by Grantee under existing FCC regulations, then
Grantee must provide, to the extent feasible, reasonably comparable programming.
5.5. Subscriber Surveys. Upon Grantor's request, and not more frequently than once
every three years during the term of this Agreement, Grantee must at its expense survey its
subscribers in the designated service area to ascertain their cable programming interests and their
level of satisfaction with Grantee's services and operations. A summary of survey results will be
provided to Grantor in both a "hard copy" and a standard electronic format. These surveys must
be conducted by qualified survey specialists who use generally accepted statistical sampling
procedures. Grantor will review the qualifications of the survey specialists and will be consulted
on the questions to be asked and other factors to assure the objectivity and statistical validity of
the survey. Grantee will facilitate a review by Grantor of a copy of each survey and its
supporting documentation within thirty (30) days after receipt of the survey results from the
survey specialists. If any survey or its supporting documentation is deemed by Grantee to be
confidential or proprietary, Grantor will maintain confidentiality to the extent authorized by law.
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Additionally, Grantee will cooperate with Grantor in conducting other community surveys or
research relating to telecommunications services.
6. SUPPORT OF LOCAL CABLE USAGE AND TECHNOLOGICAL
INFRASTRUCTURE.
(a) The obligations of Grantee that relate to the support of local cable usage,
including the provision of adequate public, educational, and governmental access channel
capacity, facilities, and financial support, are set forth in the attached Exhibit F. Grantee
acknowledges that the costs of the commitments specified in Exhibit F will not be offset against
any fees payable by Grantee to Grantor during the term of this Agreement.
(b) Any pass- through to subscribers of costs incurred by Grantee in
performing its obligations under Exhibit F must be in accordance with all applicable regulations,
formulas, and requirements of the FCC. .
DESIGN AND CONSTRUCTION.
7.1. System Construction and Extension.
(a) Future extensions of the facilities of the open video system must be
constructed and activated in accordance with Exhibits C and G, and all other applicable
provisions of this Agreement.
(b) Throughout the designated service area, and taking into consideration
financial feasibility and commercial practicability, Grantee will design and construct future
extensions of the facilities of its open video system in order to pass every single - family dwelling
unit, multiple - dwelling unit, hospital, rest -home, boarding house, school, and governmental
building, subject to the following requirements and exceptions:
1. Grantee must make its open video system services available to
residential dwelling units in all residential areas; provided, however, that Grantee's extension of
its open video system to residential dwelling units in residential areas that are annexed to the
City after the effective date of this Agreement will be subject to the line- extension requirements
set forth below in subsection (2).
2. Where residential dwelling units are located in newly- annexed
residential areas that do not meet the density requirement of at least thirty (30) homes per cable
mile, Grantee must provide, upon the written request of a prospective subscriber desiring service,
an estimate of the costs of extending service. These costs will be apportioned as follows: If
there are ten (10) residential dwelling units per cable mile, then Grantee's share will equal 10/30
or 1/3 of the construction costs. These line- extension requirements will also apply to a portion of
a cable mile that meets proportionate density requirements. Thus, if there are fifteen (15)
residential dwelling units per one -half mile, then Grantee must construct its open video system
plant without requiring a capital contribution from prospective subscribers. Grantee may require
an advance payment or an assurance of payment satisfactory to Grantee. If the area later
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achieves the density required for mandatory extensions of service, the amounts paid will be
deemed to be consideration for early extension.
3. Subject to the exceptions set forth below in subsection (4), Grantee
must extend and make its open video system services available to owners or occupants of all
residential dwellings who request connection, at the standard connection charge, if that
connection requires no more than a standard 150 -foot aerial drop line from the main feeder line.
If a connection requires more than a standard 150 -foot aerial drop line, or an underground
service connection, the prospective residential subscriber must be given the option of paying the
incremental cost for that installation.
4. If additional territory is annexed to the City after the effective date of
this Agreement, and an incumbent cable operator is then serving that annexed territory, then
Grantee may, but is not required to, overbuild in order to provide open video system services to
residential dwelling units in that territory.
5. Where the design and construction of future extensions of
Grantee's open video system facilities is asserted by Grantee to be financially infeasible or
commercially impracticable, the parties will meet and confer in a good faith effort to assess these
purported barriers to future extensions of Grantee's facilities on a case -by -case basis.
(c) Grantee may extend and make its open video system services available to
commercial, industrial, and other nonresidential zones within the designated service area.
Within one hundred eighty (180) days after the effective date of this Agreement, Grantee will
evaluate the feasibility of providing service to specific commercial corridors within the
designated service area and will report to Grantor on that evaluation.
Service to prospective subscribers residing in multiple - dwelling units need only be provided if,
after evaluating the terms and conditions for access that may be imposed by an owner or
manager of such multiple - dwelling units, Grantee determines that those terms and conditions are
reasonably acceptable; provided, however, that Grantee will use all reasonable diligence to
negotiate agreements with owners or managers of multiple - dwelling units to provide open video
system service.
7.2. Construction Components and Techniques. Construction components and
techniques must comply with the terms of this Agreement and all applicable statutes, ordinances,
regulations, City policies or procedures, and pole attachment agreements that relate to the
management and use of the public rights -of -way.
7.3. Technical and Performance Standards. Grantee must construct, reconstruct,
install, operate, and maintain its open video system in a manner consistent with all applicable
federal, state, and local laws and ordinances, FCC technical standards, City policies or
procedures, and the additional standards and requirements that are set forth in Exhibit G to this
Agreement, as may be amended from time to time.
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7.4. Construction Codes. Grantee must strictly adhere to all building and zoning
codes now or hereafter in force and must obtain all necessary permits, which permits will be
processed in a timely manner and will not be unreasonably delayed or denied. Grantee will
make every reasonable effort to arrange its lines, cables, and other appurtenances, on both public
and private property, in a manner that will minimize interference with the use of that property by
any person. In the event of such interference, Grantor may require the removal or relocation of
Grantee's lines, cables, and appurtenances from the property in question. Grantee must give at
least forty eight (48) hours advance notice to all property owners prior to installing any
additional above - ground or underground structures upon easements located on private property.
Grantor will not modify its construction requirements subsequent to the completion of
construction to require reconstruction or retrofit unless protection of the public health and safety
so requires.
7.5. Construction Default. Upon Grantee's failure, refusal or neglect to undertake or
complete any phase of construction, repair, relocation or other necessary work as required by this
Agreement, thereby creating an adverse impact upon the public health, welfare or safety, Grantor
may cause that work to be completed, in whole or in part, and upon so doing will submit to
Grantee an itemized statement of costs. Grantee will be given reasonable advance notice of
Grantor's intent to exercise this power, and fifteen (15) days to cure the default, unless a
different period for cure is specified in Exhibit G. Grantee must, within thirty (30) days of
billing, pay to Grantor the actual costs incurred.
7.6. Vacation or Abandonment. If any street, alley, public highway, or portion thereof
used by Grantee is vacated by Grantor, or its use is discontinued by Grantee, then upon
reasonable notice Grantee may be required to remove its facilities, unless otherwise specifically
authorized, or unless easements for open video system facilities have previously been reserved.
Following that removal, Grantee must restore, repair, or reconstruct the area in accordance with
the requirements of Exhibit G. Upon any failure, neglect, or refusal of Grantee, after 30 days'
notice by Grantor, to do such work, Grantor may cause it to be done, and within 30 days of
billing, Grantee must pay to Grantor the actual costs incurred.
7.7. Abandonment in Place. Grantor may, upon written application by Grantee,
approve the abandonment in place by Grantee of any property, under such terms and conditions
as Grantor may approve. Upon Grantor - approved abandonment in place of any property,
Grantee must cause to be executed, acknowledged, and delivered to Grantor such instruments as
Grantor may prescribe and approve in order to transfer and convey ownership of that property to
Grantor.
7.8. Removal of System Facilities. If Grantee's plant is deactivated for a continuous
period of thirty (30) days, (except for reasons beyond Grantee's control), and without prior
written notice to and approval by Grantor, then Grantee must, at Grantor's option and demand,
and at the sole expense of Grantee, promptly remove all of Grantee's property from any streets
or other public rights -of -way. Grantee must promptly restore the streets or other public areas
from which its property has been removed, including aerial trunk and feeder lines, in accordance
with the requirements of Exhibit G. As an alternative to the provisions set forth above, Grantor
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may exercise its option to purchase the deactivated infrastructure in accordance with the
provisions of Subsection 3.6 of this Agreement.
7.9. Movement of Facilities. If Grantor determines it is necessary to move or to
relocate any of Grantee's property because of a conflict with a public project, Grantee, upon
reasonable notice, must move, at Grantee's expense, its property in order to facilitate that public
project. No such movement or relocation may be deemed a taking of Grantee's property.
7.10. Under re ounding of Cable. Cables must be installed underground at Grantee's
cost where all existing utilities are already underground or all new utilities are being installed
underground in the area in accordance with Grantor's adopted undergrounding policy.
Previously installed aerial cable will be installed underground at Grantee's pro rata cost in
concert with other utilities as those other utilities convert from aerial to underground
construction.
7.11. Facility Agreements. This Agreement does not relieve Grantee of any obligations
to obtain pole or conduit space from any department of Grantor, from any utility company, or
from others maintaining utilities in Grantor's streets.
7.12. Repair of Streets and Public Ways. All disturbance or damage to streets and
public ways, and to improvements located within those streets and public ways, caused by
Grantee or its contractors during the construction, operation, or maintenance of the open video
system, must be restored at Grantee's expense, within the time frame specified by Grantor, and
in accordance with all applicable requirements of Exhibit G.
7.13. Erection of Poles Prohibited.
(a) Grantee may not erect any pole on or along any street or public way where
there is an existing aerial utility system. If additional poles in an existing aerial route are
required, Grantee must negotiate with the appropriate public utility for their installation. Any
such installation requires the advance written approval of Grantor.
(b) Subject to applicable federal and state law, Grantee must negotiate the
lease of pole space and facilities from the existing pole owners for all aerial construction, under
mutually acceptable terms and conditions. No pole line may be extended solely for the purpose
of accommodating Grantee's facilities. Line extensions beyond any existing pole line must be
underground where practical.
7.14. Reservation of Street Rights. Nothing in this Agreement precludes Grantor from
constructing, repairing, or altering any public work or improvement. That work will be done,
insofar as practicable, in such manner as not to unnecessarily obstruct, injure, or prevent the use
and operation of any property of Grantee. If, however, any property of Grantee interferes with
the construction, maintenance, or repair of any public improvement, that property must be
removed or replaced in such manner as may be directed by Grantor so as not to interfere with the
public work or improvement, and that removal or replacement will be at Grantor's expense.
Grantor will give Grantee sixty (60) days prior written notice of any public work or improvement
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that may require the removal or replacement of Grantee's property; provided, however, that if the
public work or improvement is necessitated by an emergency situation, notice will be given as
far in advance as is reasonably feasible under the circumstances.
7.15. Miscellaneous Design and Construction Requirements.
(a) Underground Installation of Conduit and Other Facilities. All
underground installation by Grantee of conduit and other facilities related to its system must be
in compliance with Grantor's requirements, standards, and specifications that are set forth in
Exhibit G.
(b) New Development- Underground Utility Areas. Where new construction
or property development occurs, and utilities are to be placed underground, Grantor will use its
best efforts to require the developer or property owner to give reasonable notice to Grantee of
that new construction or development. Grantee may be involved in all design aspects of the new
construction or development that relate to the infrastructure required for open video system
service, including the provision of specifications and engineering assistance prior to
construction. The costs of easements, trenching, and construction of the conduits required to
bring open video system service to the new construction or development will be borne by
Grantee, the developer, or the property owner, as may be agreed upon between them. Grantee
will be notified of any date on which the installation of conduit, pedestals, vaults, or laterals will
be available for Grantee's inspection. Grantee will bear all costs of installing cable, amplifiers,
and other equipment required to construct and operate the open video system.
(c) Antennas and Towers. Antenna supporting structures, including towers,
that are owned by or operated for Grantee must comply with all applicable electrical codes and
FCC specifications, and must be erected, illuminated, painted, and maintained in accordance
with all applicable rules and regulations of the Federal Aviation Administration, as well as local
ordinances and regulations that require Grantor's approval of the siting of towers or other
support structures within the City.
(d) Tree Trimming. Grantee is authorized (but not required) to engage a
licensed tree service contractor to trim trees on public property, at its own expense, as may be
necessary to protect its wires, facilities, and equipment, subject to Grantor's direction and
supervision. Trimming trees on private property that is not subject to a public easement requires
the written consent of the property owner or occupant. Each licensed tree service contractor
proposed to be engaged by Grantee must be in possession of a valid City business license.
(e) Mitigation of Adverse Visual Impacts. Grantee must take all
technologically and financially feasible measures, at its expense, to mitigate the adverse visual
impacts of all equipment as required by Section 25 of the OVS Ordinance, to the satisfaction of
the City Engineer. These measures may include, without limitation, (i) the installation of
landscaping and barriers to minimize public view of any authorized above - surface power
pedestals; (ii) the maintenance of the equipment in good condition, including compliance with
Grantor's ordinances requiring graffiti removal; and (iii) the placement of overhead drops as
close as possible to other utility drops, consistent with all applicable electrical codes. Ongoing
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maintenance of any landscaping required to mitigate adverse visual impacts is the responsibility
of the property owner or Grantee under Grantee's easement agreements. Grantee must inspect
all above -grade facilities located in the public rights -of -way not less frequently than once every
ninety (90) days and must complete any required maintenance or repairs within thirty (30) days
after any such inspection. Grantee must respond within seven (7) days to requests or complaints
received from Grantor or members of the public relating to the repair, replacement, or cleanliness
of above -grade facilities.
(f) Use of Chalk -Based Paints. Grantee must use only chalk -based paints to
mark public rights -of -way in connection with the construction or maintenance of the open video
system. All paint marks remaining after Grantee's cleanup following the completion of
construction or maintenance work must be removed by Grantee by means of sand - blasting,
chemicals, or high - pressure water within thirty (30) days following receipt of Grantor's written
notice requesting such removal.
(g) Vehicle Access to Private Property. If an owner's vehicle access to
private property is anticipated to be precluded for more than three hours during any construction,
operation, or maintenance of Grantee's open video system, then Grantee must give at least 24-
hours prior written notice to the owner.
(h) Location of Utilities. Grantee must verify the location of all existing
utilities to ensure that they are not damaged during construction or maintenance of the open
video system. Grantee must be a member of Underground Service Alert and must contact that
entity 48 hours in advance of any underground construction in order to ensure that utilities are
not damaged. Grantee is solely responsible for the replacement or repair of any utilities that are
damaged by Grantee or its agents during construction or maintenance activities.
(i) "As- Built" Construction Drawings. Following Grantee's construction of
any discrete portion of the open video system, Grantee will provide to Grantor "as- built"
construction drawings for that discrete portion of the system, as provided for in Subsection
8.2(c).
8. COMPLIANCE AUDITS AND TECHNICAL DATA.
8.1. Compliance and Performance Audits.
(a) Following activation of Grantee's open video system, or any portion of
that system, Grantor may, at its option, and upon reasonable advance notice, require that
compliance audits of the open video system be conducted annually by an independent technical
consultant selected and employed by Grantor, and at Grantor's expense, to verify that the system
complies with all technical standards and other specifications of this Agreement. Grantee must
be provided an opportunity to be present during any compliance audit, and Grantor must deliver
a copy of the test results to Grantee. If the test results demonstrate that Grantee has materially
failed to comply with required technical standards, the cost of the compliance audit will be home
by Grantee.
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(b) Within ninety (90) days after the third (3rd) and seventh (7th) anniversary
dates of this Agreement, and at any other time upon Grantor's request, Grantor and Grantee will
meet to review the performance of the open video system. This review may include
consideration of the following:
1. The test results relating to Grantee's compliance with technical
standards and specifications.
2. The reports required by this Agreement that relate to subscriber
complaints received by Grantee concerning technical problems or service - related issues.
3. The types and quality of services provided by Grantee, and the extent
to which Grantee's then - existing bandwidth is adequate to accommodate those services without
degradation or loss of quality and to accommodate the anticipated demand for channel capacity
on the open video system by unaffiliated video programming providers.
4. The results of any subscriber surveys that may be conducted by
Grantor or Grantee, including those referenced in Subsection 5.5.
5. Reports submitted by Grantee or any other person that address
Grantee's compliance with the provisions of this Agreement.
6. Changes in open video system technology and services, including but
not limited to a comparison of Grantee's technology and services with those of any other
franchised multi - channel video programming provider then operating in the City, and an
evaluation of established, operating state -of -the -art technology in comparable communities
within the greater Los Angeles metropolitan area, and the economic and technical feasibility of
providing interactive, addressable, and other new services.
7. Changes in state and federal laws and regulations that affect the
operation of the open video system.
8. The performance review of the open video system to be conducted
following the seventh anniversary date of this Agreement will also include consideration of the
following:
A. An assessment of the PEG access and community
connectivity needs of Grantor that are reasonably anticipated to exist during the remaining term
of this Agreement.
B. The increased or decreased financial obligations of Grantee
that are required to meet the PEG access and community connectivity needs of Grantor that are
identified above in subparagraph (A).
C. Appropriate adjustments to Grantee's financial obligations
to Grantor, as specified in this Agreement, which adjustments are deemed necessary to maintain
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parity and equivalency between Grantee and any other franchised multi- channel video
programming provider then operating within the City.
(c) Within thirty (30) days after the conclusion of a system performance
review meeting, Grantor may issue findings with respect to system compliance as required under
this Agreement. If noncompliance with required performance standards is identified, Grantor
may direct Grantee to correct the noncompliance within a reasonable period of time. In addition,
if a determination is made that the services provided by Grantee's open video system are such
that there remains fifty (50) MHz or less of available bandwidth, or that more than five percent
of the nodes within the designated service area are experiencing traffic congestion, and that
additional or more advanced services cannot be provided using the limited bandwidth capacity
that remains, then Grantor and Grantee will meet within the subsequent thirty (30) day period.
Such meeting will be for the purpose of determining whether either of the following courses of
action will be implemented in order to provide the additional bandwidth capacity that is required
for additional or more advanced services: (i) a reconfiguration of Grantee's open video system;
or (ii) an upgrade of Grantee's open video system to a bandwidth capacity that will meet or
exceed then - existing industry standards. Any such mutually agreed -upon reconfiguration or
upgrade must be completed within a period of twenty four (24) months from the date of
commencement, which date of commencement will be not later than the next anniversary date of
this Agreement.
(d) Participation by Grantor and Grantee in this system performance and
compliance review process does not impose upon Grantee any obligation not imposed by federal
or state law, and neither Grantor nor Grantee waive any rights they may have under applicable
federal or state law.
(e) In addition to the meetings provided for under paragraph (b) above, and
upon Grantor's reasonable request, Grantee will meet with Grantor's representatives to discuss
the extent to which the technology and services of the open video system are comparable to
established, operating state -of -the -art technology in franchised multi - channel video
programming systems serving comparable communities in the greater Los Angeles metropolitan
area, it being understood by the parties that Grantee will provide to subscribers in the designated
service area a level of overall service that is comparable, on average, to the services provided by
multi- channel video programming system operators that are then operating in the Cities of
Beverly Hills, Burbank, Glendale, Long Beach, Monrovia, Pasadena, Santa Monica, Thousand
Oaks, and Torrance. Nothing in this Agreement, however, may be deemed to require that
Grantee provide a service where it is not technically or economically feasible to do so. Topics
for discussion at these meetings may also include, without limitation, the future use of interactive
services, the sharing of local production facilities with other jurisdictions, and the provision of
additional capacity for public, educational, or governmental access channels.
(f) When new or more advanced services are made available to Grantee's
subscribers within its regional cluster of open video systems, Grantee will make those same
services available in the designated service area no later than one hundred twenty (120) days
after they are offered to subscribers in any community within that regional cluster. Exceptions to
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this requirement will be made for pilot projects or experimental services that may be temporarily
offered in limited market areas.
(g) When Grantee undertakes an upgrade or rebuild of its technical plant, or
platform, in communities within Grantee's regional cluster of open video systems, such platform
upgrade or rebuild will be commenced in the designated service area in a sequence that
reasonably ensures improvements in a timely manner, consistent with good business practices.
8.2. System Testing and Technical Data.
(a) Immediately prior to Grantor's activation of any new extension of the
open video system, Grantee must conduct performance testing of its open video system,
including its signal quality, in accordance with FCC rules and regulations. Upon Grantor's
request, those test results will be provided to Grantor by Grantee.
(b) During any future extension of the open video system, Grantee will
incorporate test equipment wherever feasible in order to continuously monitor the system for
outages and signal quality.
(c) Following completion of construction of any new extension of the open
video system, and upon Grantor's request, Grantee will provide to Grantor copies of "as- built"
system drawings and technical documentation in both a printed and an electronic data format.
Grantor may not disclose this information to third parties without Grantee's prior written
approval.
(d) Grantee must maintain at its local office specified in Subsection 1.1(b) a
file of all documents that are required by the FCC or other governmental agencies to be made
available for public inspection during normal business hours and upon reasonable advance
notice. Grantee may charge a reasonable fee for any copies of documents that may be requested
by members of the public.
8.3. Emergency Repair Capability. It is Grantee's responsibility to ensure that its
personnel are qualified to make repairs, that they are available at all reasonable times, and that
they are supplied with keys, equipment location instructions, and technical information necessary
to begin repairs upon notification of the need to maintain or restore continuous service to the
open video system.
9. RECORDS; REPORTS; RIGHT TO INSPECT AND AUDIT; EXPERTS.
9.1. Grantee to Provide Records. All reports and records required under this Section
10 must be furnished at the sole expense of Grantee.
9.2. Records. Grantee must maintain and make available for inspection and copying
during normal business hours, and upon reasonable notice, a separate and complete set of
business records that are reasonably related to the scope of Grantor's rights under this
Agreement, or Grantor's regulatory functions. Grantee need not maintain all such records at the
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office specified in Subsection 1.1(b), but will make them available for inspection at that location
unless alternative arrangements are agreed upon by Grantor and Grantee.
9.3. Maintenance and Inspection of Records. Grantee must maintain accurate books
and records, in conformity with generally accepted accounting principles, showing all receipts,
expenses, loans, payments, investments of capital, and other transactions relating to the open
video system. Grantor, upon reasonable notice, has the right to inspect those records and to
receive copies to the extent that information is reasonably related to the scope of Grantor's rights
under this Agreement, or Grantor's regulatory functions. To the extent authorized by law,
Grantor will protect the confidentiality of information contained in Grantee's business records
that are deemed by Grantee to be proprietary, as provided for below in Section 10.
9.4. Reports of Financial and Operating Activity.
(a) Not later than one hundred twenty (120) days after the close of each fiscal
year of Grantee during the term of this Agreement, Grantee must submit to Grantor a financial
report, certified by a designated financial officer of Grantee, that sets forth the gross annual
revenue from all sources within the designated service area, the annual gross subscriber revenues
derived from each tier of service in the designated service area, the total amountand basis for the
computation of the annual fees paid to Grantor, and such other relevant facts as may reasonably
be required by Grantor to verify the accuracy of the payment of fees on gross annual revenue.
To the extent authorized by law, and in accordance with Section 10 below, Grantor will protect
the confidentiality of information contained in Grantee's business records that are deemed by
Grantee to be proprietary, except as may be ordered by a court of competent jurisdiction after
reasonable written notice to Grantee. Grantee will retain for at least three years documents that
serve as the basis for this financial report.
(b) During the term of this Agreement, and upon Grantor's request, Grantee
must submit reports concerning any or all of the following operational matters:
1. A summary of Grantee's activities within the designated service area
including, but not limited to, services added or discontinued, changes in technology, and the
number of new installations.
2. A current list of Grantee's officers, directors, and other principals.
3. A summary of outage records and routine service- related calls
received from subscribers for installation and service. If Grantee's collection and tabulation of
subscribers' service calls and complaints covers a geographic area that is more extensive than the
designated service area, then Grantee must use its best efforts to estimate the number of those
service calls and complaints originating in the designated service area and must inform Grantor
of the methodology used in making those estimates.
4. A summary of subscriber complaints that were referred to Grantee by
Grantor, including the date of referral, nature of the complaint, and the corrective action taken.
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5. A description of the nature and purpose of any new construction that is
anticipated to commence within the following two years.
6. A summary of Grantee's compliance with the Consumer Protection
Standards that are referenced in Exhibit E.
9.5. Performance Tests and Compliance Reports. Upon Grantor's request, and not
more than once annually, Grantee must provide a written report of any required FCC tests that
have been conducted. In addition, Grantee must provide reports of any tests and compliance
procedures required by this Agreement not later than thirty (30) days after the completion of
those tests and compliance procedures.
9.6. Additional Reports. Grantee must prepare and submit to Grantor in writing, at the
times and in the form reasonably prescribed by Grantor, all additional reports that may
reasonably be required with respect to Grantee's compliance with the provisions of this
Agreement. Grantor will cooperate with Grantee and will accept existing reports that contain
substantially similar information meeting this requirement.
9.7. Communications with Regulatory Agencies. Copies of all non - routine and
material communications between Grantee and the Federal Communications Commission, or any
other agency having jurisdiction in respect to any matters affecting the open video system
operations authorized by this Agreement, must be submitted to Grantor within ten (10) days after
their receipt or submittal by Grantee.
9.8. Inspection of Facilities. Upon.reasonable notice, and during normal business
hours, Grantee must permit inspection by any duly authorized representative of Grantor of all
facilities located within the designated service area as well as Grantee's headend, which may be
located outside the designated service area. Grantee may appoint one or more representatives to
accompany Grantor's representatives on any such inspection.
9.9. Right to Audit.
(a) In addition to all other inspection rights under this Agreement, upon
twenty (20) days prior written notice, Grantor has the right to inspect and audit, during normal
business hours, documents pertaining to Grantee's operations in the designated service area that
are reasonably necessary to Grantor's enforcement of its rights under this Agreement; provided,
however, that Grantor may not conduct duplicative inspections and audits for those periods of
time that have previously been subject to examination. Those documents will be made available
at Grantee's local office unless Grantor and Grantee agree otherwise. To the extent authorized
by law, information derived from any records identified by Grantee as being proprietary will be
held in confidence by Grantor, except as may be ordered by a court of competent jurisdiction
after reasonable written notice to Grantee.
(b) Any audit conducted by Grantor. under this subsection will be conducted at
the sole expense of Grantor, not more frequently than once in any 12 -month period. Grantor will
prepare a written report containing its findings, a copy of which will be mailed to Grantee for its
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review. Grantee must reimburse Grantor for the expense of any such audit if, as the result of that
audit, it is determined that there is a shortfall of more than two percent (2 %) in the amount of
fees on gross annual revenue or other payments that have been made or will be made by Grantee
to Grantor under the terms of this Agreement. That reimbursement must be made by Grantee
within 30 days of written notice from Grantor.
9.10. Retention of Experts. When deemed to be necessary for the exercise of its rights
under this Agreement, Grantor has the further right to retain technical experts and other
consultants to ensure compliance with and enforcement of the provisions of this Agreement.
Grantor will normally bear the cost of retaining those experts; provided, however, that Grantee
must reimburse Grantor for all expenses related to the retention of these experts and consultants
if either of the following is applicable:
(a) Grantee has initiated proceedings that would normally require Grantor to
retain experts or consultants, such as renewal of the Agreement (to the extent allowed by law),
expansion of the designated service area, or the modification of this Agreement.
(Reimbursement of costs and expenses relating to the review and processing of a request for
approval of a transfer or a change in control is governed exclusively by the provisions of
Subsection 13.1(c) of this Agreement); or
(b) The reports of those experts or consultants as submitted to Grantor reveal
that Grantee has substantially failed to comply with the terms and conditions of this Agreement.
If Grantee is required to reimburse Grantor in accordance with subparagraphs (a)
or (b), Grantor will send Grantee an itemized statement describing all charges, and Grantee must
pay that amount within thirty (30) days after receipt of that itemized statement.
10. PROTECTION OF GRANTEE'S PROPRIETARY INFORMATION.
10.1. "Proprietary Information" Defined. For the purpose of this Section 10, the term
"proprietary information" means any written information or data that Grantee is required under
this Agreement to submit to Grantor, or to make available for inspection by Grantor, which
enables Grantor to perform its regulatory functions relating to Grantee's provision of cable
services, and which, if disclosed to third parties, would result in unfair competitive disadvantage
to Grantee.
10.2. Identification of Proprietary Information. Grantor will cooperate with Grantee in
an effort to preserve and to protect, to the maximum extent authorized by law, the privileged and
confidential nature of all proprietary information that, at the time it is submitted to or inspected
by Grantor, is clearly identified by Grantee as being "proprietary, privileged, and confidential."
10,3. Notice to Grantee. If Grantor receives a request under the California Public
Records Act ( Califomia Government Code Sections 6250 et seq.), or under any legal process
that may require disclosure of Grantee's information, data, or documents that have been
identified as "proprietary, privileged, and confidential," then Grantor will: (i) give Grantee
prompt written notice of that request; and (ii) use all reasonable efforts to defer disclosure until
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Grantee determines to waive compliance with the provisions of this,Section 10, or to seek an
appropriate protective order at Grantee's sole cost and expense, or to pursue such other legal
remedies as may be necessary to protect the privileged and confidential nature of Grantee's
proprietary information, also at Grantee's sole cost and expense. In the event of any such legal
proceedings, Grantor shall cooperate with Grantee, provided however, that Grantor shall be
entitled to utilize legal counsel of Grantor's sole choosing.
10.4. California Public Records Act. This Section 10 is in all respects subject to the
California Public Records Act, which will supersede the provisions of this section in the event of
any conflict.
11. BREACH OF FRANCHISE: GROUNDS FOR ASSESSMENT OF PENALTIES AND
FRANCHISE REVOCATION.
11.1. Termination or Revocation for Breach. In addition to all other rights and powers
retained by the City under the OVS Ordinance or otherwise, the City reserves the right to
terminate this Agreement and all rights and privileges of Grantee, revoke this Agreement, or
assess damages or penalties against Grantee, in the event of any material breach of its terms and
conditions. A material breach by Grantee shall include, but not be limited to, the following:
(a) Violation of any material provision of the OVS Ordinance, this Agreement or any
material rule, order, regulation or directive issued in connection with this Franchise;
(b) Evasion of any material provision of the OVS Ordinance or this Agreement, or
the practice of fraud or deceit upon the City or its Subscribers and customers;
(c) Material misrepresentation of fact in the application for this Agreement, or any
renewal or transfer of this Agreement, whether by act or omission;
(d) Failure to pay any required fee, tax or charge when said payment is due;
(e) Failure to restore Cable Service after 72 consecutive hours of interrupted Cable
Service, except in the event that the City approves in writing a longer period of interruption after
making a determination that there exists just cause for such longer period of interruption;
(f) Failure to provide at least eighty percent (80 %) of subscribed Cable Services over
the Cable System for a period of five (5) days, except in the event that the City approves in
writing a longer period of interruption after making a determination that there exists just cause
for such longer period of interruption;
(g) Failure to substantially meet customer service standards established in the
Franchise over any consecutive three -month period of time, pursuant to Section 49 of the OVS
Ordinance;
(h) Failure to initiate or Complete System Construction, or reconstruction as required
by this Agreement, unless the City Council expressly approves the delay by motion or resolution,
due to the occurrence of conditions beyond Grantee's control;
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(i) Failure to provide or maintain in full force and effect at all times any insurance
coverage, letter of credit or bonds required by this Agreement;
0) Violation of orders or rulings of any regulatory body having jurisdiction over
Grantee relating to this Agreement;
(k) Failure to provide, upon written request, data, documents, reports or information;
and
(1) Failure to pay debts and obligations as they mature in accordance with normal
business practices; assignment of Grantee or its assets for the benefit of its creditors; dissolution,
liquidation or ceasing to conduct business; application by Grantee for (or consent by Grantee to)
the appointment of a receiver, trustee, liquidator; or the filing of a bankruptcy petition by
Grantee to the extent permitted by federal law or the sale of all or substantially all of Grantee's
assets.
11.2. Procedure for Adjudication of Breaches of Agreement. Prior to imposing any
liquidated damages, sanction or penalty upon Grantee, including termination or revocation of this
Agreement, the City Manager, shall demand in writing that Grantee cure such breach or
diligently commence a cure of such breach within a specified period, which period shall not be
less than thirty (30) days following notification. However, only fifteen (15) days notice shall be
required in the case of failure to pay monies due. In addition, the City may, in an emergency,
prescribe a notice less than thirty (30) days consistent with the nature of the emergency. An
emergency under this subsection 11.2 means an occurrence or condition that creates an actual or
imminent danger to life or property. Should Grantee fail to provide sufficient written proof
within the specified cure period that corrective action has been taken, or that corrective action is
being actively and expeditiously pursued by Grantee, then the City Manager may, in his or her
sole discretion, elect to either place the issue of termination, revocation or other penalty before
an appropriate hearing officer for his or her determination pursuant to subsection 11.3 or the City
Council pursuant to subsection 11.4 of this Ordinance. The City Council, the City Manager, or
any hearing officer authorized to act pursuant to this Section 1 I shall have the power to issue
subpoenas in order to carry out the fact - finding activities. The process for the issuance and
enforcement of such subpoenas shall be governed by the California Code of Civil Procedure.
11.3. Hearing Officer Procedures. The City Manager may, at his or her sole discretion
and in lieu of the procedures set forth in subsection 11.4, refer to a hearing officer any
controversy or claim arising out of or relating to the Franchise or its existence, construction,
interpretation, performance, enforcement, operation, breach, continuance or termination. Such
hearing proceedings shall be initiated by the City Manager by written notice to Grantee. The
procedures set forth in Section 49, subdivisions (13)(2)(a) -(o inclusive, of the OVS Ordinance
shall govern the conduct of such administrative hearing. The hearing officer shall be vested with
quasi - judicial authority, and shall be authorized to:
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(a) order Grantee to undertake remedial action to cure any breach of its obligations
under this Agreement,
(b) assess liquidated damages and/or levy a penalty upon Grantee in accordance with
the terms of the OVS Ordinance and this Agreement,
(c) determine that Grantee has not violated any of its obligations under this
Agreement, and/or
(d) recommend to the City Council grounds for the revocation of this Agreement.
Failure of Grantee to fully and promptly comply with an order of a hearing officer shall
be deemed a material breach of the Franchise.
11.4. City Council Hearing Procedures. In the event the City Manager elects, in his
sole and absolute discretion to refer a matter to the City Council pursuant to subsection 11.4, the
City Council shall hold a public hearing to determine whether Grantee materially breached the
Franchise and the appropriate penalty to be imposed, if any, as a result of such breach. The City
shall cause to be served upon Grantee, at least ten (10) days prior to the date of such hearing,
written notice of any intent to terminate the Franchise and the time and place of the hearing.
Grantee may appear at such hearing and present such evidence, orally or in writing that it deems
relevant and appropriate to the Council's deliberations. Based on the evidence presented at the
hearing, the City Council shall determine, in writing, in its discretion whether or not a material
breach occurred and whether to terminate the Franchise or take other appropriate action. Should
the City Council find that there has been a material breach of the Franchise, but that termination
of the Franchise is inappropriate, then the Council may assess and levy or impose such other
relief as the Council deems appropriate, including, but not limited to, any relief specified in
subsections 11.3, 11.5, or any combination thereof. The City shall cause Grantee to be served
with written notice of any action taken by the City Council following such public hearing. The
decision of the City Council as to such matters shall be final, but may be challenged by Grantee
in a court of competent jurisdiction. Nothing herein is intended to limit the City Council's right
to make other determinations that are reasonably related to this Agreement, or to seek any other
appropriate relief to which the City may be entitled, at law or equity, as a result of any breach by
Grantee of its obligations under this Agreement.
11.5. Penalties for Breach of Agreement. The hearing officer or City Council may
impose the following penalties for any breach of the Franchise, except any breach of Subscriber
service standards, which shall be governed by Section 49 of the OVS Ordinance:
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(a) Up to $500 for each day of each material breach, or such other amount provided
in this Agreement.
(b) For a second material breach of the same nature occurring within twelve (12)
months where a fine or penalty was previously assessed, $1,000 for each day of each material
breach.
(c) For a third or further material breach of the same nature occurring within twelve
(12) months of the first such breach, where a fine or penalty was previously assessed, up $2,000
for each day of each material breach.
11.6. Alternative Remedies. The remedies provided in this Section 11 are cumulative
and in addition to all other rights the City may have at law or equity or under this Agreement,
including but not limited, to liquidated damages, which remedies may be exercised at any time.
In no event shall the amount of any cash deposit, insurance, bond, letter of credit or any other
security instrument be construed to limit Grantee's liability for damages.
12. CONTINUITY OF OPEN VIDEO SYSTEM SERVICES.
12.1. Continuity of Service. The parties acknowledge that it is the right of all
subscribers to receive all services authorized by this Agreement so long as they honor their
financial and other obligations to Grantee. During Grantee's construction of any extension of the
open video system, and upon any future sale of the system, Grantee must use commercially
reasonable efforts to provide continuous service to subscribers. In the event of purchase by
Grantor, or a change of operator, Grantee will cooperate with Grantor or the new operator to
operate the system for an interim period in order to maintain continuity of service to all
subscribers. If Grantee intentionally abandons all services on a system -wide basis for 72
continuous hours, and Grantee is in material default of this Agreement, or if this Agreement is
revoked by Grantor, then Grantor may, by resolution, when reasonable cause is deemed to exist,
assume operation of the open video system on an interim basis for the purpose of maintaining
continuity of service. Grantor's operation of the system may continue until the circumstances
that, in the judgment of Grantor, resulted in the cessation of cable services are resolved to
Grantor's satisfaction. Grantor is entitled to receive all revenues and is responsible for all
obligations and liabilities during any period in which it operates the system.
12.2. Operation and Management by Grantor.
(a) During any period when the open video system is being operated by
Grantor under Subsection 12.1 above, Grantor will attempt to minimize the disruption of
operations in a manner consistent with the maintenance of continuing service to subscribers.
Notwithstanding the foregoing, Grantor may, as it deems necessary, make any changes in any
aspect of operations that, in Grantor's sole judgment, are required for the preservation of quality
and continuity of service. During that period, Grantor will also maintain to the best of its ability
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the system's records, physical plant, financial integrity, funds, and other elements normally
involved in operations.
(b) Grantor may, upon assuming operation of the open video system, appoint
a manager to act for it in conducting the system's affairs. That manager will have such authority
as may be delegated by Grantor and will be solely responsible to Grantor for management of the
system. Grantee must reimburse Grantor for all reasonable costs, in excess of system revenues
retained by Grantor, that are incurred during Grantor's operation if this Agreement remains in
effect during the period of Grantor's operation.
13. MISCELLANEOUS PROVISIONS
13.1. Assignment, Transfer, Sale, and Change of Control.
(a) Consummation of the following transactions related to this Agreement, of
involving Grantee under this Agreement, requires the prior written consent of Grantor's City
Council expressed by ordinance or resolution, which consent will not be unreasonably withheld,
and then only under such conditions as may lawfully be prescribed:
1. The sale, transfer, lease, assignment, or other disposition of the rights
granted by this Agreement, in whole or in part, whether voluntary or involuntary as set forth in
Section 8(B) of the OVS Ordinance; provided, however, that such consent is not required for a
transfer in trust, mortgage, or other hypothecation for the purpose of securing an indebtedness of
Grantee relating to the construction, reconstruction, operation, or maintenance of the open video
system.
2. Any merger, consolidation, reorganization, business combination, or
other transaction wherein or whereby twenty percent (20 %) or more of the voting interests of
Grantee, of the Person exercising management authority over Grantee, will be effected. A duly
executed copy of any written instrument evidencing the closing and consummation of any such
transaction must be filed in the office of the City Clerk within 10 days after the closing and
consummation of that transaction.
(b) In determining whether it will consent to any transfer, assignment, or other
disposition of the Agreement, or to any transaction affecting the control of Grantee, Grantor may
evaluate the legal, financial, technical, and other qualifications of the proposed transferee or
controlling person. Grantee must ensure that the proposed transferee or controlling person
submits an application, in the form required by the OVS Ordinance, or by any applicable federal
law, prior to the closing date of the proposed transaction. After considering the legal, financial,
technical, and other qualifications of the proposed transferee or controlling person, the City
Council may, by ordinance or resolution, authorize the proposed transaction, subject to such
conditions as may be lawfully imposed in order to protect the public interest. Grantor's consent
to any such transaction may not be unreasonably denied or delayed. A transfer shall not be
granted unless the proposed transferee agrees in writing that it will abide by and accept all terms
of the OVS Ordinance, this Agreement and such other agreements, regulations or restrictions that
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pertain to this Agreement, assume the obligations and liability of the previous Grantee and
assume such other condtions as may be prescribed by the City Council approving the transfer.
(c) Grantee and its proposed transferee or controlling person are jointly and
severally responsible for reimbursement to Grantor of all costs and expenses reasonably incurred
in evaluating and processing the application related to the proposed transaction. These costs and
expenses may include, as may be determined by Grantor to be reasonably necessary, the
following: costs of administrative review; financial, legal and technical evaluation of the
proposed transferee; costs for technical experts and consultants; notice and publication costs; and
document preparation expenses. The application fee payable upon submission of the application
will be in an amount prescribed by the City Council from time to time, which will be deemed to
be a deposit for Grantee's reimbursement of costs and expenses to be incurred by Grantor. If
Grantor anticipates that the reimbursable costs and expenses will exceed such prescribed amount,
Grantee will be given advance written notification. The parties will then meet and confer
concerning the estimated total costs and expenses and the proposed allocation between the
parties of costs and expenses that are anticipated to exceed the prescribed amount. Grantee's
reimbursement of costs and expenses will be made not later than 30 days after receipt from
Grantor of an itemized statement setting forth those costs and expenses.
(d) The requirements of this Subsection 13.1 do not apply to the restructuring
of debt or to the transfer of ownership interests between existing equity owners of any of the
entities identified in the attached Exhibit B; provided, however, that Grantee must: (1) provide
to Grantor not less than 30 days prior written notice of that proposed transaction; (2) provide
information concerning ownership and voting interests in the proposed transferee if different
from those of the transferor; (3) provide a list of officers, directors, and any managing employees
of the proposed transferee, if different from those of the transferor, and their cable industry-
related experience and expertise; (4) represent that the proposed transaction will have no
foreseeable effect on the management and operation of the Grantee's cable system in the
franchise service area; and (5) agree to execution by the Grantee and the proposed transferee of
an assignment and assumption agreement, in form and substance acceptable to the Grantor's City
Attorney, whereby the proposed transferee assumes all of Grantee's obligations under this
Agreement and accepts its terms and conditions.
13.2. Force Majeure.
(a) If Grantee's performance of any of the terms, conditions, obligations, or
requirements of this Agreement is prevented or impaired by any cause or event beyond its
reasonable control and not reasonably foreseeable, that inability to perform will be deemed to be
excused, and no penalties or sanctions will be imposed. Those causes beyond Grantee's
reasonable control and not reasonably foreseeable include, but are not limited to, acts of God,
civil emergencies, labor unrest, strikes, inability to obtain access to an individual's property, and
inability of Grantee to secure all necessary authorizations or permits to use necessary poles or
conduits so long as Grantee exercises due diligence to obtain those authorizations or permits in a
timely manner.
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(b) Where any cause or event is beyond Grantee's reasonable control and is
not reasonably foreseeable, and that cause or event only partially affects Grantee's ability to
perform, Grantee must perform to the maximum extent possible. In that event, Grantee must
give written notice to Grantor of any such cause or event within 10 business days after Grantee
has learned or should have learned of its occurrence.
(c) Except as may be otherwise provided in paragraphs (a) and (b) above,
Grantee's compliance with the terms, conditions, obligations, and requirements of this
Agreement will not be excused on the basis of increases in the cost of performance, changes in
economic circumstances, or nonperformance by an employee, agent, or contractor of Grantee.
13.3. Possessory Interest. By accepting this Agreement, Grantee acknowledges notice
was given to Grantee, as required by California Revenue and Taxation Code Section 107.6, that
use or occupancy of any public property under the authority set forth in this Agreement may
create a possessory interest that may be subject to the payment of property taxes levied upon that
interest. The payment of any such possessory interest tax shall be the responsibility of Grantee
under this Agreement.
13.4. Indemnification. Except to the extent that they result from the intentional or
negligent conduct of Grantor, or Grantor's agents, representatives, or employees, Grantee will
indemnify, defend, and hold harmless Grantor, its officials, officers, agents and employees, from
any liability, claims, damages, costs, or expenses, including reasonable attorney's fees, arising
out of or attributable to the exercise or enjoyment of the rights granted by this Agreement.
Grantee, at its sole cost and expense, and upon demand of Grantor, will appear in and defend
(with counsel reasonably acceptable to Grantor) all suits, actions, or other legal proceedings,
whether judicial, quasi- judicial, administrative, legislative or otherwise, instituted by third
persons or duly constituted authorities, against or affecting Grantor, its officers, agents, or
employees, and arising out of or pertaining to the exercise of rights conferred by this Agreement
within the designated service area, and injury to persons or damages to property proximately
caused by any conduct undertaken by Grantee, its agents, employees, or subcontractors, by
reason of the Agreement.
13.5. Receivership and Foreclosure.
(a) At the option of Grantor, this Agreement will terminate 120 days after the
appointment of a receiver, or trustee, to take over and conduct the business of Grantee, whether
in a receivership, reorganization, bankruptcy or similar action or proceeding, unless that
receivership or trusteeship is vacated prior to the expiration of that 120 -day period, or unless:
(i) the receiver or trustee, within 120 days after that appointment, fully complies with all the
terms and provisions of this Agreement, and remedies all defaults under this Agreement; and
(ii) the receiver or trustee, within that 120 -day period, executes an agreement duly approved by
the court having jurisdiction in the matter, whereby that receiver or trustee assumes and agrees to
be bound by each and every term, provision, and limitation of this Agreement.
(b) Upon a foreclosure or other judicial sale of the plant, property, or
equipment of Grantee, or any part thereof, including or excluding this Agreement, Grantor may
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serve notice of termination upon Grantee and the successful bidder at that sale, in which event
this Agreement, and all rights and privileges of Grantee under it, will terminate 30 days after the
service of that notice, unless: (i) Grantor approves the transfer of the Agreement in the manner
provided by this Agreement; and (ii) the successful bidder covenants and agrees with Grantor to
assume and be bound by all the terms and conditions of this Agreement.
13.6. Conflict of Interest. The parties agree that, to their knowledge, no member of the
City Council, nor any other officer or employee of Grantor, has any interest, whether contractual,
non - contractual, financial or otherwise in this Agreement, or in other business of Grantee, and
that if any such interest comes to the knowledge of either party at any time, a full and complete
disclosure of that information will be made in writing to the other party, even if that interest
would not be considered a conflict of interest under applicable laws. Grantee covenants that it
has, at the time of execution of this Agreement, no interest, and that it will not acquire any
interest in the future, direct or indirect, that would conflict in any manner with the performance
of its obligations under this Agreement. Grantee further covenants that, in the performance of its
obligations, no person having any such interest will be engaged or employed.
13.7. Resolution of Disputes.
(a) Disputes regarding the interpretation or application of any provisions of
this Agreement will, to the extent reasonably feasible, be resolved through good faith
negotiations between the parties.
(b) If any action at law or in equity is brought to enforce or interpret any
provisions of this Agreement, that action must be initiated in state court located within Los
Angeles County, State of California, regardless of any other possible jurisdiction or venue. Ir
addition, the prevailing party in any such action is entitled to reasonable attorneys' fees, costs
and necessary disbursements, in addition to any other relief that may be sought and awarded.
13.8. Waiver by Grantor. Grantor has the right to waive any provisions of this
Agreement that apply to Grantee's obligations, except those required by federal or state laws or
regulations, if Grantor determines (i) that it is in the public interest to do so, and (ii) that the
enforcement of such provision will impose an undue hardship on Grantee or its subscribers. To
be effective, a waiver must be in writing and signed by a duly authorized representative of
Grantor.
13.9. Severability. If any provision of this Agreement is determined by a court of
competent jurisdiction to be invalid or unenforceable, the remaining provisions will not be
affected unless their enforcement under the circumstances would be unreasonable, inequitable, or
would otherwise frustrate the purposes of this Agreement.
13.10. Amendments. This Agreement supersedes all prior proposals, agreements and
understandings between the parties and may not be modified or terminated orally. No
modification, termination or attempted waiver of any of its provisions will be binding unless in
writing and signed by the party against whom the same is sought to be enforced.
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13.11. Binding Upon Successors. This Agreement is binding upon and inures to the
benefit of each of the parties and to their respective transferees, successors and assigns.
13.12. Counterpart Execution. This Agreement may be executed in multiple
counterparts, each of which is deemed to be an original and all of which constitute one and the
same instrument.
13.13. Applicable Law. This Agreement and the transactions contemplated by it are to
be construed in accordance with and governed by the applicable laws of the State of California
and of the United States.
14. DEFINITIONS.
14.1. Defined Terms. For the purposes of this Agreement, the following words, terms,
phrases, and their derivations have the meanings set forth below. When not inconsistent with the
context, words used in the present tense include the future tense, and words in the singular
number include the plural number.
"Affiliate" has the same meaning as is set forth in 47 C.F.R. §76.100(g), which is
a part of the FCC regulations relating to open video systems.
"Basic Service" or "Basic Cable Service" or "Basic Service Tier" means the
lowest service tier that includes the retransmission of local television broadcast signals, including
those of public, educational, and governmental access channels.
"1984 Cable Act" means the Cable Communications Policy Act of 1984.
"1992 Cable Act' means the Cable Television Consumer Protection and
Competition Act of 1992.
"Cable Act" means the 1984 Cable Act as amended by the 1992 Cable Act and by
the Telecommunications Act of 1996.
"Cable Service" means the following: (A) the one -way transmission to
subscribers of (i) video programming, or (ii) other programming services, and (B) subscriber
interaction, if any, that is required for the selection or use of that video programming or other
programming service, as hereinafter may be amended, regardless of the content of such video
programming or communications or the technology or method used to deliver such
programming.
"Community Channel" means any channel that is set aside for use by Grantor, or
by Grantor - authorized organizations or groups that are based in the designated service area or
that are sponsored or funded by Grantor, for the purpose of cablecasting noncommercial
programming that is determined by Grantor to be of community -wide interest.
"Complaint" means a billing dispute in which a subscriber notifies Grantee of an
outage or degradation in picture quality that is not corrected following the initial telephone or
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service call, as well as any other communication from a subscriber that relates to the operation of
the open video system, whether or not it involves a billing dispute.
"Control" or "Controlling Interest" means the possession, directly or indirectly, of
the power to direct, or to cause the direction of, the management and policies of a specified
Person, whether through the ownership of voting securities, by contract or otherwise.
"Designated Service Area" or "Service Area" means that territory within the City
of Arcadia that is specifically described in the Agreement.
"Drop" or "Drop Lines" means the cable and related equipment connecting the
open video system's plant to equipment at the premises of a subscriber or the facilities of
Grantor.
"Education Channel" means any channel on the open video system that designates
educational institutions as the primary providers of non - commercial programming.
"FCC" means the Federal Communications Commission or its designated
representatives.
"Franchise" means the right to construct, operate and maintain a Cable System
using the City's streets and rights -of -way pursuant to the terms and conditions of this chapter and
other relevant provisions of the Municipal Code, the Franchise Agreement, and any Ordinance or
Resolution approving the transfer of the Franchise, and any agreement between the City and
Grantee relating to the operation of the Cable System.
"Government Channel" means any channel on the open video system that is
provided by Grantee to Grantor and other governmental institutions designated by Grantor on
which non - commercial informational programming regarding government activities and
programs may be presented.
"Grantee" means Champion Broadband California, LLC, and the lawful
successors, transferees, or assignees of that entity.
"Grantor" means the City of Arcadia, acting by and through its elected City
Council, or such representative as the City Council may designate to act on cable matters in its
behalf.
"Gross Annual Revenue" means all revenue, cash, credits, property of any nature,
and other consideration of any kind, as determined in accordance with generally accepted
accounting principles, that is derived directly or indirectly by Grantee from or attributable to the
sale or exchange of any Cable Service by or through the open video system; or in any manner
derived from the operation of the open video system. Such revenue and other consideration
includes, without limitation, the following:
(i) Fees received from residential and commercial subscribers to any
tier of OVS Service and for all video programming services.
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(ii)
Fees received for installation, reconnection, downgrade, upgrade,
and similar services.
(iii)
Late fees and interest collected on delinquent subscriber fees or
charges.
(iv)
Fees paid for channels that are designated for commercial use.
(v)
Fees paid in connection with the rental, lease, or sale of converters,
remote controls, and other equipment.
(vi)
Leased or access channel revenues received in connection with the
distribution of any OVS Service.
(vii)
All bad debts that are recovered.
(viii)
All revenue that is received by Grantee, or its subsidiaries or
affiliates, from the conduct of any service - related activity directly
involving the video portion of the open video system, including
without limitation revenues derived from advertising sales, the sale
of products or services on home shopping channels, and the sale of
program guides.
(ix)
The fair market value of any nonmonetary consideration received
by Grantee in any transaction with another person relating to the
receipt of OVS Service or the operation of the open video system,
such as a barter transaction, but not less than the customary prices
paid in connection with equivalent transactions.
(x)
All carriage revenues received from video programming providers,
including incentive fees for carriage, contra expense, barters, or
other transactions where generally accepted principles would
require treatment as revenue.
The term "gross annual revenue" does not include the following:
(i) Refundable deposits, rebates, or credits.
(ii) Bad debt that is unrecovered or unrecoverable.
(iii) Taxes imposed by law on subscribers that Grantee is obligated to
collect on behalf of any governmental agency.
(iv) Revenues collected by unaffiliated video programming providers.
(v) PEG fees paid to the Grantor per Subscriber as required by this
Agreement.
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(vi) Advertising commissions paid to advertisers that are not wholly
owned subsidiaries of Grantee.
(vii) Programming launch fees and marketing support payments where
Grantee received reimbursements for mandatory marketing costs
associated with the launch and promotion of services offered.
" Headend" means that central portion of the open video system where signals are
introduced into and received from the balance of the system.
"Hub" means a secondary signal processing location where the signals generated
at the primary headend are combined with locally - generated signals for distribution to
subscribers in the community.
"Incumbent Cable Television Operator" means any person who, in accordance
with a franchise authorized by Grantof, is providing cable service over a cable system.
"Monitorin¢" or "Tapping" means observing or receiving a signal, where the
observer is neither the sending nor receiving party and is not authorized by the sending or
receiving party to observe that signal, whether the signal is observed or received by visual,
electronic, or any other means.
"Node" means a location in a hybrid fiber optic /coaxial cable system where light
signals are converted into electrical signals in the downstream direction, and electrical signals are
converted into light signals in the upstream direction.
"Open Video System" or "OVS" means a facility consisting of a set of
transmission paths and associated signal generation, reception, and control equipment that is
designed to provide cable service(s), which includes video programming, and that is provided to
multiple subscribers within the City, provided that the FCC has certified that such system
complies with its regulations as set forth in 47 C.F.R. §76.1500 et sue.
"Open Video System Operator" or "OVS Operator" means any person or group of
persons who provides cable service over an open video system and directly or through one or
more affiliates owns a significant interest in that open video system, or otherwise controls or is
responsible for the management and operation of that open video system.
"Open Video System Service" or "OVS Service" means (i) the video
programming services distributed by an OVS operator or its affiliate directly to subscribers in the
community by use of the OVS operator's broadband fiber -optic transmission facilities ( "OVS
Programming Service "); and (ii) the video transmission services provided by the OVS operator
or its affiliate to video programming providers for their use in delivering video programming to
their subscribers in the community ( "OVS Transmission Service ").
"Pay Cable," "Pay Service," "Premium Service" or "Pay Television" means
signals for which there is a fee or charge to users over and above the charge for basic service,
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including any tiers of service; provided, however, the sale or lease of studio facilities, equipment,
or tapes to local users are not deemed to be pay or premium services.
"PEG Access Channels" means the channels that have been reserved by the
incumbent cable television operator for public, educational, or governmental use.
"Person" means any individual, corporation, partnership, proprietorship, limited
liability company, or organization authorized to do business in the State of California, but shall
not, unless the context clearly requires it, include the City.
"Plant" means the transmitting medium and related equipment that transmits
signals between the headend and subscribers, excluding drops.
"Pole Attachment Agreement" or "Attachment Agreement" means any agreement
with Grantor, with any other governmental entity, or with any public utility relating to Grantee's
use of utility poles, ducts, or conduits.
"Program" or "Programming" means the information content of a signal and the
act or process of creating that content, whether that content is intended to be pictures and sound,
sound only, or any other form of information.
"Programmer" means any person who provides program material or information
for transmission by means of an open video system.
"Property of Grantee" means all property owned or leased by Grantee within the
designated service area in the conduct of its open video system business under an agreement.
"Public Channel" or "Public Access Channel" means any channel on the Cable
System that is provided by Grantee for non - commercial programming produced by members of
the public or a nonprofit corporation formed by the City to operate and manage such a channel..
"Public Rights of Way" means any of the following that are controlled, used or
dedicated for use by the public and located within the City's jurisdictional limits: streets,
roadways, highways, avenues, lanes, alleys, sidewalks, public utility easements, rights of way
and similar public property within which Grantee may place its facilities for operating an open
video system.
"Residential Dwelling Unit" or "Dwelling Unit" means a home, mobile home,
condominium, apartment, cooperative unit, and any other individual dwelling unit used for
residential purposes.
"Service Interruption" means the loss of picture or sound on one or more cable
channels, as well as the loss of any voice or data services that are provided by the OVS operator.
"Service Tier" or "Tier" means a category of cable service or other services
provided by the OVS operator and for which a separate rate is charged by the OVS operator,
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other than per - channel or per -event programming or packages of per - channel or per -event
programming.
"Shared Channel" means any channel carrying video programming that is selected
by more than one video programming provider and is offered to subscribers.
"Streets" means the surface of, and the space above and below, any public street,
sidewalk, alley, or other public way or right -of -way of any type.
"Subscriber" means any Person who pays for Cable Services provided by Grantee
by means of the Cable System.
"Video Programming" means any and all video programming (including, but not
limited to, origination programming) provided by the Grantee to Subscribers and any
communications that are ancillary, necessary or common to the use or enjoyment of such video
programming.
"Video Programming Provider" means any person, company, or service that
provides one or more channels of video programming including any communications that are
ancillary, necessary or common to the use and enjoyment of the Video Programming, to or from
an address in the City, including to or from a business, home, condominium, or apartment, where
some fee is paid, whether directly or included in dues or rental charges for that service, when
Public Rights -of -Way are utilized in the delivery of the Video Programming or communications,
regardless of the content of such Video Programming or communications or the technology or
method used to deliver such programming..
14.2. Terms Not Defined. Words, terms, or phrases not defined above in paragraph (a)
shall first have the meaning as defined in the Cable Act, and next in the OVS Ordinance, and
next the special meanings attributable to their use in any industry, business, trade, or profession
where they commonly carry special meanings. if those special meanings are not common, they
will be defined as set forth in commonly used and accepted dictionaries of the English language.
15. CONSIDERATION FOR GRANTOR'S FORBEARANCE.
15.1. OVS Franchise Violations. As set forth in paragraph (D) of the Recitals to this
Agreement, neither Altrio, as the seller of the open video system assets, nor Grantee, as the buyer
of those assets, requested Grantor's prior written consent to that purchase and sale agreement as
required by Altrio's agreement with Grantor and by Grantor's regulatory ordinance, although
Grantee gave verbal notice of the proposed transaction to the City manager and Special Assistant
to the City Manager. Additionally, as set forth in paragraph (E) of those Recitals, no payments
have been made by Grantee to Grantor of any amounts that had accrued but were unpaid during
Altrio's operation of the open video system prior to March 26, 2004.
15.2. Consideration for Grantor's Forbearance. In consideration for Grantor's
forbearance in pursuing all rights and remedies available in law or equity, and under the
provisions of the OVS Agreement with Altrio, which rights and remedies included revocation of
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the authority to construct, operate, and maintain an open video system in Grantor's public streets
and rights -of -way within the designated service area, Grantee agrees to pay to Grantor the
amount of $43,841 in accordance with the provisions of Subsection 15.3 below.
Upon the effective date of this Agreement, Grantee will make a payment to Grantor in the
sum of $43,841, which represents payment in full for all accrued PEG fees, franchise fees, and
community connectivity fees.
16. AUTHORITY AND EFFECTIVE DATE.
16.1. Authority. The persons signing below represent that they have the requisite
authority to bind the entities on whose behalf they are signing.
16.2. Effective Date. This Agreement will become effective on the date specified in
Subsection 1.6. It is the intention of the parties that Grantee will first execute this Agreement
and then submit it to Grantor. The City Clerk will insert the effective date in all counterparts of
this Agreement, attest to their execution by a duly authorized officer of Grantor, and transmit one
or more fully executed counterparts to Grantee.
TO EFFECTUATE THIS AGREEMENT, each of the parties has caused this
Agreement to be signed by its duly authorized representative on the date set forth below the
authorized signature.
APPROVED AS TO FORM: CITY OF ARCADIA
@W� ,? 'v,e� By:
City Attorney
Date:
AT
ity Clerk
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CHAMPION BROADBAND CALIFORNIA, LLC,
a Wyoming limited liability company
By:
(Authorized Corporate Officer)
Title: C£c7
Date: / -3— o6
APPROVED AS TO FORM:
Corporate Counsel
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EXHIBIT A
ORDINANCE NO. 2206 AS
ADOPTED AND IN EFFECT ON THE
EFFECTIVE DATE OF THE AGREEMENT
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UNCODIFIED
ORDINANCE NO. 2206
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF ARCADIA, REGULATING
CABLE, VIDEO, AND TELECOMMUNICATIONS SERVICE
WHEREAS, the Communications Act of 1934 (48 Star. 1064, 15 USC § 21; 47 USC §§
35, Section 621 [47 U.S.C. 541] (b)(1) states, except to the extent provided in paragraph (2) and
subsection (f), a cable operator may not provide cable service without a franchise; and
WHEREAS, the Communications Act of 1934 (48 Stat. 1064, 15 USC § 21; 47 USC §§
35, Section 653. [47 U.S.C. 5731 (a) (1) states a local exchange carrier may provide cable
service to its cable service subscribers in its telephone service area through an open video system
that complies with this section; and
WHEREAS, California Government Code Section 53066 (a) states that any city or
county or city and county in the State of California may, pursuant to such provisions as may be
prescribed by its governing body, authorize by franchise or license the construction of a
community antenna television system. In connection therewith, the governing body may
prescribe such rules and regulations as it deems advisable to protect the individual subscribers to
the services of such community antenna television system; and
WHEREAS, California Government Code Section 53066 (b) states the award of the
franchise or license may be made on the basis of quality of service, rates to the subscriber,
income to the city, county or city and county, experience and financial responsibility of the
applicant plus any other consideration that will safeguard the local public interest, rather than a
r.
cash auction bid; and
WHEREAS, the federal Telecommunications Act of 1996 preempts and declares invalid
all state rules that restrict entry or limit competition in both local and long- distance telephone
service; and
WHEREAS, the California Public Utilities Commission ( "CPUC ") is primarily
responsible for the implementation of local telephone competition, and it issues certificates of
public convenience and necessity to new entrants that are qualified to provide competitive local
telephone exchange services and related telecommunications service, whether using their own
facilities or the facilities or services provided by other authorized telephone corporations; and
WHEREAS, Section 234(a) of the California Public Utilities Code defines a "telephone
corporation" as "every corporation or person owning, controlling, operating, or managing any
telephone line for compensation within this state'; and
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WHEREAS, Section 616 of the California Public Utilities Code provides that a telephone
corporation "may condemn any property necessary for the construction and maintenance of its
telephone line'; and
WHEREAS, Section 2902 of the California Public Utilities Code authorizes municipal
corporations to retain their powers of control to supervise and regulate the relationships between
a public utility and the general public in matters affecting the health, convenience, and safety of
the general public, including matters such as the use and repair of public streets by any public
utility and the location of the poles, wires, mains, or conduits of any public utility on, under, or
above any public streets; and
WHEREAS, Section 7901 of the California Public Utilities Code authorizes telephone
and telegraph corporations to construct telephone or telegraph lines along and upon any public
road or highway, along or across any of the waters or lands within this state, and to erect poles,
posts, piers, or abutments for supporting the insulators, wires, and other necessary fixtures of
their lines, in such manner and at such points as not to incommode the public use of the road or
highway or interrupt the navigation of the waters; and
WHEREAS, Section 7901.1 of the California Public Utilities Code confirms the right of
municipalities to exercise reasonable control as to the time, place, and manner in which roads,
highways, and waterways are accessed, which control must be applied to all entities in an
equivalent manner, and may involve the imposition of fees; and
WHEREAS, Section 50030 of the California Government Code provides that any
permit fee imposed by a city for the placement, installation, repair, or upgrading of
telecommunications facilities, such as lines, poles, or antennas, by a telephone corporation that
has obtained all required authorizations from the CPUC and the FCC to provide
telecommunications services, must not exceed the reasonable costs of providing the service for
which the fee is charged, and must not be levied for general revenue purposes.
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF ARCADIA DOES ORDAIN
AS FOLLOWS:
SECTION 1 Short Title and Authority
SECTION 2 Definitions
SECTION 3 A Franchise is required to operate a Cable System
SECTION 4 The City may grant a Cable Franchise
SECTION 5 Franchise duration and renewal
SECTION 6 Limitations of Franchise
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SECTION 7
Rights reserved to the City
SECTION 8
Transfers and assignments
SECTION 9
Franchise Area; annexations
SECTION 10
Application for Franchises; contents of application
SECTION 11
Selection of Grantee
SECTION 12 Franchise renewal
SECTION 13 Multiple Franchises
SECTION 14 Franchise application processing costs
SECTION 15 Franchise fee for Cable Services
SECTION 16 Contents of cable television Franchise
SECTION 17 Breach of Franchise; grounds for assessment of penalties and Franchise
revocation
SECTION 18
Procedure for adjudication of breaches of the Franchise
SECTION 19
Hearing Officer hearing procedures
SECTION 20
City Council hearing procedures
SECTION 21
Penalties for breach of the Franchise
SECTION 22 Alternative remedies
SECTION 23 Removal and abandonment; purchase of system
SECTION 24 Receivership and foreclosure
SECTION 25 Undergrounding
SECTION 26 Use of poles
SECTION 27 Construction standards
SECTION 28 Approvals
SECTION 29 Submission of drawings
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SECTION 30 Relocation of facilities and equipment
SECTION 31 Maintenance
SECTION 32 Operational Standards
SECTION 33 Service Standards
SECTION 34
Billing and Information Standards
SECTION 35
Verification Compliance with Standards
SECTION 36
Subscriber Complaints and Disputes
SECTION 37
Disconnection/Downgrades
SECTION 38
Negative Option Billing Prohibited
SECTION 39
Deposits
SECTION 40
Parental Control Options
SECTION 41
Additional Requirements
SECTION 42
Penalties for Noncompliance
SECTION 43
Additional Consumer Protection and Services Standards
SECTION 44 Compatibility with consumer electronics equipment
SECTION 45 Rate regulation
SECTION 46 Billing procedures
SECTION 47 Refunds
SECTION 48 Notice of rate increases
SECTION 49 Non - discrimination and customer privacy
SECTION 50 Written or oral notice to enter property
SECTION 51 Notice regarding channel scrambling
SECTION 52 Tenant rights
SECTION 53 Continuity of service mandatory
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SECTION 54
Applicability
SECTION 55
Application required
SECTION 56
Review of application
SECTION 57
Agreement required and Fees
SECTION 58
Other multichannel video programming distributors
SECTION 59
Video providers- registration; customer service standards
SECTION 60
Telecommunications service provided by telephone
corporations
Section 1. SHORT TITLE AUTHORITY.
•
This title is known and may be cited as the "Cable, Video, and Telecommunications Service
Providers Ordinance" of the City of Arcadia. This chapter is enacted by the City of Arcadia
pursuant to City's charter authority, the Cable Act, the City's police powers, its powers and
rights to control the use of the Public Right -of -Way within the City, and all other applicable
laws.
Section 2. DEFINITIONS.
For the purposes of this chapter, the following terms, phrases, words, and abbreviations shall
have the meaning given herein. When not inconsistent with the context, words used in the
present tense include the future tense, and words in singular number include the plural number.
Words not defined by this section shall be given the meaning set forth in the Cable Act, and if
not defined therein, their common and ordinary meaning.
ACCESS, PEG ACCESS OR PEG USE. Refers to the availability or use of a Cable System or
Open Video System for public, educational or government use (including Institutional Network
use) by public or private agencies, institutions, organizations, groups, and individuals, including,
but not limited to Grantor, and its designated Access providers, to acquire, create, and distribute
programming not under Grantee's editorial control, including, but limited to, the following:
(A) Public Access or Public Use where members of the general public are the primary
or designated programmers or users having editorial control over their programming.
(B) Educational Access or Educational Use where educational institutions are the
primary or designated programmers or users having editorial control over their programming.
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(C) Government Access or Government Use where Grantor or other governmental
institutions designated by Grantor are the primary or designated programmers having editorial
control over their programming.
AFFILIATE. The term "affiliate" means a person that (directly or indirectly) owns or controls,
is owned or controlled by, or is under common ownership or control with, another person. For
purposes of this paragraph, the term "own" means to own an equity interest (or the equivalent
thereof) of more than 10 percent.
CABLE ACT. The Cable Communications Policy Act of 1984 (47 USC 521 et seq., as amended
by the Cable Television Consumer Protection and Competition Act of 1992 (Public Law No.
102 -385) and the Telecommunications Act of 1996 (Public Law No. 104 -104), and as hereinafter
may be amended.
CABLE SERVICE. Means the following: (A) the one -way transmission to Subscribers of (i)
Video Programming, or (ii) other programming service, (B) Subscriber interaction, if any, that is
required for the selection or use of such video programming or other programming service, as
hereinafter may be amended, regardless of the content of such video programming or
communications or the technology or method used to deliver such programming.
CABLE SYSTEM OR SYSTEM. Grantee's facilities, consisting of a set of closed transmission
paths and associated signal generation, reception, and control equipment that is designed to
provide video programming and that is provided to multiple Subscribers within the City. Such
term does not include:
(A) A facility that serves solely to retransmit the television signals of one or more
television broadcast stations; or
(B) A facility that serves Subscribers without using any Public Right -of -Way; or
(C) A facility of a common carrier that is subject, in whole or in part, to the provisions
of Subchapter II of Chapter 5 of Title 47 of the United States Code, except that such facility shall
be considered a Cable °System (other than for purposes of 47 USC 541(c)) to the extent such
facility is used in the transmission of video programming directly to Subscribers, unless the
extent of such use is solely to provide interactive on- demand services; or if such facility is used
to provide Cable Service, whether on a common carrier or non- common carrier basis, directly to
customers; or
(D) An Open Video System, as defined below, that complies with 47 USC Section
573; or
(E) Any facilities of any electric utility used solely for operating its electric utility
systems.
CITY. The City of Arcadia, California.
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CITY MANAGER. The City Manager of the City of Arcadia, or his or her designee.
COMMUNICATIONS ACT. The Communications Act of 1934 (48 Stat. 1064,15 USC § 21; 47
USC §§ 35, 151- -155, 201 - -221, 301 - -329, 401 -416, 501- -505, 601 - -609 (as subsequently
amended and as hereinafter may be amended).
COMPLETE SYSTEM CONSTRUCTION. The point in time when all transmission equipment,
facilities, and construction work is installed and completed, and when all appropriate tests have
been completed such that applicable performance standards pertaining to or dependant upon such
construction is verified. The term Complete System Construction does not include marketing
and installation of Subscriber service.
CONTROL(ING /ED). The possession, directly or indirectly, of the power to direct, or to cause
the direction of, the management and policies of a specified Person, whether through the
ownership of voting securities, by contract or otherwise.
DISTRIBUTION FACILITY /(IES). Cable equipment that is not specific to a Subscriber,
including trunk and distribution lines, but excluding drop lines to specific locations.
DROP LINES. The cable and related equipment connecting the Cable System's plant to
equipment at the Subscriber's premises.
EDUCATIONAL ACCESS CHANNEL. A channel on the Cable System that designates
educational institutions as the primary providers of non - commercial programming.
FCC. The Federal Communications Commission.
FRANCHISE. The right to construct, operate and maintain a Cable System using the City's
streets and rights -of -way pursuant to the terms and conditions of this chapter and other relevant
provisions of the Municipal Code, the Franchise Agreement, and any Ordinance or Resolution
approving the transfer of the Franchise, and any agreement between the City and Grantee
relating to the operation of the Cable System.
FRANCHISE AGREEMENT. An agreement granting a Franchise pursuant to the terms of the
agreement and this chapter. Any conflict between the terms of this chapter and the Franchise
Agreement shall be resolved in favor of the Franchise Agreement. In the event a Franchise is in
existence as of the effective date of this ordinance, the terms of the Franchise shall govern;
provided however, that upon the renewal, extension, amendment or other modification of any
such Franchise, the renewed, extended, amended or otherwise modified Franchise shall comply
with this ordinance.
FRANCHISE AREA. The geographic area within the City designated in a franchise where
Grantee may operate a Cable System, as defined in the Franchise Agreement.
GOVERNMENT ACCESS CHANNEL. A channel on the Cable System that is provided by
Grantee to Grantor and other governmental institutions designated by Grantor on which non-
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commercial informational programming regarding government activities and programs may be
presented.
GRANTEE. Any Person to whom a valid Franchise is granted by the City under this chapter,
and the lawful successor, transferee or assignee of such Person.
GROSS REVENUES. All revenue, cash, credits, property of any nature, and other consideration
derived directly or indirectly by Grantee, from or attributable to the sale or exchange of any
Cable Service by or through the Cable System, or from or attributable to the sale or exchange of
any Video Programming over the respective Open Video Service System; or in any manner
derived from the operation of the Cable System or the respective Video Service System, unless
otherwise prohibited by federal or state law. Such revenue and other consideration, regardless
of technological platform, includes, without limitation, the following:
Fees received from residential and commercial subscribers to any tier of Cable Service and for
all Video Programming services.
Fees received for installation, reconnection, downgrade, upgrade, and similar services.
Late fees and interest collected on delinquent subscriber fees or charges.
Fees paid for channels that are designated for commercial use.
Fees paid in connection with the rental, lease, or sale of converters, remote controls, and
other equipment.
Leased or access channel revenues received in connection with the distribution of any
Cable Service.
All bad debts that are recovered.
All revenue that is received by Grantee, or its subsidiaries or affiliates, from the conduct of any
service - related activity directly involving the video portion of the Cable System, including
without limitation revenues derived from advertising sales, the sale of products or services on
home shopping channels, and the sale of program guides.
The fair market value of any nonmonetary consideration received by Grantee in any
transaction with another person relating to the receipt of Cable Service or the operation of the
Cable System as it pertains to the offering of Cable Service, such as a barter transaction, but not
less than the customary prices paid in connection with equivalent transactions.
All carriage revenues received from video programming providers, including incentive
fees for carriage, contra expense, barters, or other transactions where generally accepted
accounting principles would require treatment as revenue.
A franchise fee if itemized and added to the bill
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The term "Gross Revenues" does not include the following:
(A) Refundable deposits, rebates, or credits.
(B) Bad debt that is unrecovered or unrecoverable.
r]
(C) Taxes imposed by law on subscribers that Grantee is obligated to collect on behalf of
any governmental agency.
(D) Revenues collected by unaffiliated video programming providers.
(E) PEG fees paid to the Grantor per subscriber as required by the Franchise Agreement.
(F) Advertising commissions paid to advertisers that are not wholly -owned subsidiaries
of Grantee.
(G)Programming launch fees and marketing support payments where Grantee receives
reimbursements for mandatory marketing costs associated with the launch and promotion of
services offered.
Gross Revenues shall include revenue received by any entity other than the Grantee where
necessary to prevent evasion or avoidance of the obligation under this Agreement to pay the
Franchise fees.
MULTICHANNEL VIDEO PROGRAMMING DISTRIBUTOR A Person such as, but not
limited to, a Cable System operator, an Open Video System Operator, as defined below, a
Multichannel multipoint distribution service, a direct broadcast satellite service, or a television
receive -only satellite program distributor, who makes available multiple channels of video
programming for purchase by Subscribers or customers.
OPEN VIDEO SYSTEM. A facility consisting of a set of transmission paths and associated
signal generation, reception, and control equipment that is designed to provide Cable Services,
including video programming, and that is provided to multiple Subscribers within the City,
provided that the FCC has certified that such system complies with 47 CFR §§ 1500 et seq.,
entitled "Open Video Systems."
OPEN VIDEO SYSTEM OPERATOR. Any Person or group of Persons who provides Cable
Services over an Open Video System and directly or through one or more Affiliates owns a
significant interest in that Open Video System, or otherwise controls or is responsible for the
management and operation of that Open Video System.
NORMAL OPERATING CONDITIONS. Service conditions that are within the control of
Grantee. Those conditions that are ordinarily within the control of Grantee include, but are not
limited to, special promotions, rate increases, regular peak or seasonal demand periods, and
scheduled maintenance or upgrade of the Cable System. Those conditions that are not in control
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of Grantee include, but are not limited to, natural disasters, civil disturbances, power outages,
telephone network outages, and severe or unusual weather conditions.
PERSON. Any individual, corporation, partnership, proprietorship, or other organization
authorized to do business in the State of California.
PUBLIC ACCESS CHANNEL. A channel on the Cable System that is provided by Grantee for
non - commercial programming produced by members of the public or a nonprofit corporation
formed by the City to operate and manage such a channel.
PUBLIC RIGHT(S) -OF -WAY. Any of the following that are controlled, used or dedicated for
use by the public and located within the City's jurisdictional limits: streets, roadways, highways,
avenues, lanes, alleys, sidewalks, public utility easements, rights of way and similar public
property within which Grantee may place its facilities for operating a Cable System.
SERVICE INTERRUPTION. The loss or impairment of the Cable Services on one or more
channels or frequency bands of the Cable System used in connection with the provision of Cable
Services to any Subscriber.
SUBSCRIBER. Any Person who pays for Cable Services provided by Grantee by means of the
Cable System.
VIDEO PROGRAMMING PROVIDER AND VIDEO SERVICE SUPPLIER. Any person,
company, or service that provides one or more channels of video programming including any
communications that are ancillary, necessary or common to the use and enjoyment of the Video
Programming, to or from an address in the City, including to or from a business, home,
condominium, or apartment, where some fee is paid, whether directly or included in dues or
rental charges for that service, when Public Rights -of -Way are utilized in the delivery of the
Video Programming or communications, regardless of the content of such Video Programming
or communications or the technology or method used to deliver such programming.
VIDEO PROGRAMMING. Any and all video programming (including, but not limited to,
origination programming) provided by the Grantee to Subscribers and any communications that
are ancillary, necessary or common to the use or enjoyment of such video programming ."
SECTION 3. A FRANCHISE IS REQUIRED TO OPERATE CABLE SYSTEM.
(A) It shall be unlawful for any Person to establish, operate or carry on the business of
distributing to any Persons in the City any Cable Service or Video Programming, by means of a
Cable System, unless a Franchise therefore is first obtained pursuant to the provisions of this
chapter, and unless such Franchise is in full force and effect.
(B) It shall be unlawful for any Person to construct, install or maintain within any
Public Right -of -Way in the City, or within any other public property of the City, or within any
privately owned area within the City which has not yet become a Public Right -of -Way but is
designated or delineated as a proposed Public Right -of -Way on any tentative subdivision map
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approved by the City, any equipment or facilities for distributing any Cable Services or Video
Programming, by means of a Cable System, unless a Franchise authorizing such use of such
street or property or area has first been obtained pursuant to the provisions of this chapter, and
unless such Franchise is in full force and effect.
(C) It shall be unlawful for any Person to make any unauthorized connection, whether
physically, electronically; acoustically, inductively or otherwise, with any part of a Franchised
Cable System within this City for the purpose of enabling him or herself or others to receive any
Cable Services carried on a Cable System, without the permission of Grantee.
(D) It shall be unlawful for any Person, without the consent of Grantee, to willfully
tamper with, remove, or injure any cables, wires, or equipment used in conjunction with a Cable
System.
(E) This section shall be construed to require a Franchise in every instance, except to
the extent that such requirement is preempted by state or federal law.
SECTION 4. THE CITY MAY GRANT A CABLE FRANCHISE
The City may by ordinance or resolution grant a Franchise to any Person, whether operating
pursuant to an existing Franchise or not, who offers to provide a Cable Service pursuant to the
terms and provisions of this chapter. The Franchise shall be subject to all ordinances and
regulations of general application now in effect or subsequently enacted, including, without
limitation, those concerning encroachment permits, business licenses, zoning, and building.
SECTION 5. FRANCHISE DURATION AND RENEWAL.
(A) The term of the Franchise or any Franchise renewal shall be established in the
Franchise Agreement.
(B) A Franchise may be renewed by the City upon application of Grantee pursuant to
procedures established by the City, subject to applicable federal and state law. In the event the
City does not establish such renewal procedures, the Franchise renewal procedures set forth in
the Cable Act shall apply.
SECTION 6. LIMITATIONS OF FRANCHISE.
(A) Any Franchise granted under this chapter shall be nonexclusive and for the term
specified by the Franchise Agreement.
(B) No privilege or exemption shall be granted or conferred by any Franchise granted
under this chapter except those specifically presented herein.
(C) The grant of a Franchise, right, or license to use Public Right -of -Way for
purposes of providing Cable Service shall not be construed as a right or license to use such
Public Right -of -Way for any other purpose.
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(D) Any privilege claimed by Grantee under a Franchise in a Public Right -of -Way or
any other public property shall be subordinate to any prior or subsequent lawful occupancy or
use thereof, or easement therein, by the City or other government entity.
(E) A Franchise granted hereunder shall not relieve Grantee of any obligation related
to obtaining pole space from any department of the City, utility company, or from others
maintaining poles in the Public Right -of -Way.
(F) Any right or power in, or duty imposed upon any officer, employee, department,
or board of the City shall be subject to transfer by the City to any other officer, employee,
department, or board of the City.
SECTION 7. RIGHTS RESERVED TO THE CITY
(A) Subject to those restrictions, if any, that are mandated by state or federal law,
neither the granting of any Franchise nor any of the provisions of this chapter shall be construed
to prevent the City from granting additional Franchises.
(B) Grantee, by its acceptance of any Franchise, agrees to be bound by all ordinances
and regulations of general application now in effect or subsequently enacted (including, without
limitation, those that concern encroachment permits, business licenses, zoning and building) and
to comply with any action or requirements of the City in its exercise of such rights or power;
provided, however, that such ordinances and regulations shall not materially affect Grantee's
rights or obligations under the Franchise.
(C) Neither the granting of any Franchise, nor any of the provisions of this chapter,
shall constitute a waiver or bar to the exercise of any governmental right or power of the City.
(D) This chapter shall not be construed to impair or affect, in any way, the right of the
City to acquire the property of Grantee through the exercise of the power of eminent domain, in
accordance with applicable law.
(E) The City Council may do all things that are necessary in the exercise of its
jurisdiction under this chapter and may determine any question of fact that may arise during the
existence of any Franchise granted under this chapter.
SECTION 8. TRANSFERS AND ASSIGNMENTS.
(A) No Franchise shall be transferred, sold or assigned, nor shall any of the rights,
privileges, interests or property related to the Franchise be transferred, sold, hypothecated or
assigned, either in whole or in part, directly or indirectly, voluntarily or involuntarily, to any
Person without the prior consent of the City granted by resolution of the City Council. The
granting of a security interest in any assets of the Grantee, or any mortgage or other
hypothecation, will not be deemed a transfer for the purposes of this section.
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(B) Transfer of a Franchise includes, but is not limited to, any transaction in which
control of the Franchise is transferred from one Person or group of Persons to another Person or
group of Persons, or ownership or other interest in Grantee or its Cable System is transferred
from one Person or group of Persons to another Person or group of Persons, or the rights and
obligations held by Grantee under the Franchise Agreement are transferred or assigned to
another Person or group of Persons. In addition, a transfer of the Franchise shall be deemed to
have occurred upon the transfer on a cumulative basis of ownership or control of 20% of (1) the
voting interest of Grantee, or (2) the Person exercising management authority over Grantee.
(C) Grantee shall promptly notify the City in writing of a proposed transfer and shall
file with the City Manager an application requesting approval of the proposed transfer ( "Transfer
Application "). The Transfer Application shall meet the requirements of Section 10 (with the
transferee being the applicant), and shall provide complete information on the proposed
transaction, including a copy of the bona fide offer, and details on the legal, financial, technical
and other qualifications of the transferee.
(D) In making a determination on whether to approve the Transfer Application, the
City Council shall consider the legal, financial, technical and other qualifications of the
transferee to operate the system, whether the incumbent Cable System operator is in compliance
with its Franchise Agreement and this chapter and, if not, the candidate transferee's commitment
and plan to cure such noncompliance, whether operation by the transferee would adversely affect
Cable Services to Subscribers or otherwise be contrary to the public interest, and such other
criteria provided for by applicable state and federal law.
(E) A Transfer Application shall not be granted unless the proposed transferee agrees
in writing that it will abide by and accept all terms of this chapter, the Franchise Agreement, and
such other agreements, regulations or restrictions that pertain to the Franchise, assume the
obligations and liabilities of the previous Grantee under the Franchise, and assume such other
conditions as may be prescribed by the City Council resolution approving the transfer.
(F) Approval by the City of a Transfer Application does not constitute a waiver or
release of any of the rights of the City under this chapter or a Franchise Agreement, whether
arising before or after the date of the transfer.
SECTION 9. FRANCHISE AREA; ANNEXATIONS
(A) The Franchise Area shall be established by the Franchise Agreement.
(B) Territory annexed to the City ( "Annexed Territory ") that is not within the
Franchise Area of an existing Franchise may be added to Grantee's Franchise pursuant to City
Council resolution.
(C) All rights acquired under a Franchise or license granted by a public entity other
than the City ( "Foreign Franchise ") shall terminate by operation of law as to Annexed Territory
where Grantee of such Franchise or license has not commenced installation of a Cable System in
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the annexed territory before the date such annexation becomes effective. Where feasible, City
shall provide notice to the holder of a Foreign Franchise of the City's intent to annex territory
that may result in a termination under this section. Failure to provide such notice shall not affect
the termination ofthe.Foreign Franchise.
(D) Where Grantee of a Foreign Franchise has commenced installation of a Cable
System in annexed territory on or before the date such annexation becomes effective, Grantee
may continue to provide Cable Services to the annexed territory for the balance of the initial term
of said Franchise (exclusive of any renewal or extension not granted by the City), subject to the
terms and conditions then in effect under such Franchise, and the timely payment to the City of
all Franchise fees paid in connection with such service (or such other fees imposed by the City
up to the maximum permitted by law).
SECTION 10. APPLICATION FOR FRANCHISES; CONTENTS OF APPLICATION.
(A) Applications for the grant of a new Franchise may be submitted by any Person
pursuant to the requirements of this chapter and subject to the terms of Arcadia Resolution 5784,
as such resolution may, from time to time, be amended. The City may, by advertisement or any
other means, solicit applications for a new Franchise pursuant to a request for proposal ( "RFP ").
(B) An application for a new Franchise to construct, operate, or maintain any Cable
System in the City shall be filed with the office of the City Clerk and shall be on forms
prescribed by the City. The City reserves the right to waive all application formalities where the
City determines that the best interests of the City would be served by such waiver. The City
may, at its sole discretion, request new or additional proposals.
(C) Unless waived in writing by the City, all applications for a Franchise shall at the
minimum contain the following:
(a) The name, address, and telephone number of the applicant;
(b) A detailed statement of the corporation or business entity organization of
the applicant, including, but not limited to, the following:
(1) The names, residence and business addresses of all officers and
directors of the applicant;
(2) The naives, residence and business address of all officers, Persons
and entities having an ownership interest of 5% or more in the applicant and the respective
ownership share of each such officer, Person or entity;
(3) The names and address of any parent or subsidiary of the applicant,
namely, any other business entity owning or controlling applicant in whole or in part or owned
or controlled in whole or in part by the applicant, and a statement describing the nature of any
such parent or subsidiary business entity, including but not limited to Cable Systems owned or
controlled by the applicant, its parent and subsidiary and the areas served thereby;
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(4) A detailed description of all previous experience of the applicant in
providing Cable Service or other similar or related communications services;
(5) A detailed and complete financial statement of the applicant, certified by
an independent certified public accountant, for the fiscal year preceding the date of the
application. The City may require a statement from an independent certified public accountant
or a recognized lending institution, certifying that the applicant has available sufficient
financial resources to construct and operate the proposed Cable System in the City;
(6) A detailed financial plan (pro forma) for the operation of the proposed
Cable System, during the term of the proposed Franchise, in the format required by the City;
and
(7) A description of any other Cable System Franchise(s) awarded to the
applicant, its parent or subsidiary, including the place and term of these Franchises; the status
of their completion, the total cost of completion of each Cable System; and the amount of
applicant's and its parent's or subsidiary's resources committed to the completion of these Cable
Systems;
(B) A detailed description of the proposed plan of operation of the applicant which
shall include, but not be limited to, the following:
(1) A detailed map indicating all areas proposed to be served, and a
proposed time schedule for the construction of the Cable System and the installation of all
equipment necessary to become operational throughout the entire area to be serviced;
(2) A statement or schedule setting forth all proposed classifications of rates
and charges to be made against Subscribers, including installation charges and other service
charges;
(3) A detailed statement describing the actual equipment and operational
standards proposed by the applicant;
(4) A copy of the form of any agreement, undertaking, or other instrument
proposed to be entered into between the applicant and any Subscriber; and
(5) A detailed statement describing any existing or proposed agreements and
undertakings between the applicant and any Person, which materially relates to the application
and the granting of the Franchise;
(6) A detailed description of the applicant's plan to provide Public,
Educational and Government Access Channel capacity services, facilities and equipment;
(7) A detailed description of the applicant's plans to address the institutional
network needs of the City
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(8) A copy of any agreement covering the Franchise area, if existing
between the applicant and the local telephone and/or electric utilities providing for the use of
any facilities of the utility including but not limited to poles, lines or conduits; and
(9) Any other details, statements, or information pertinent to the subject
matter of such application which shall be required or requested by the City.
SECTION 11. SELECTION OF GRANTEE.
(A) The City may make such investigations as it deems necessary to determine the
ability of an applicant to satisfactorily perform its obligations under a Franchise. The applicant
shall timely furnish to the City all such information and data as the City may request. Failure to
provide any such information shall constitute sufficient grounds for rejection of any application.
(B) Upon receipt of a complete application, with all information required by the City,
and after the City staff completes its investigation and review of the application, the City
Manager shall prepare a report and make recommendations to the City Council concerning the
application.
(C) The City Council shall hold a noticed public hearing on the application. Written
notice shall be given at least ten (10) days prior to the hearing on the application by U.S. mail,
postage prepaid to the applicant and by publication once in a newspaper of general circulation
within the City. Within sixty (60) days after the close of the hearing, unless an extension of time
is mutually agreed upon by the City and the applicant, the Council shall make a written decision
as to whether the Franchise should be granted, and if granted, subject to what conditions. The
Council may grant one or more Franchises, or may decline to grant any Franchise.
(D) In making its determination as to whether to grant an application for a new
Franchise, the City may consider any and all factors which affect the interests of the community
including, but not limited to, the quality of the Cable Service proposed, the areas to be served,
the rates to be charged, the amount of Franchise fee to be generated, the experience, character,
background, performance history and financial responsibility of an applicant (and its
management and owners), the technical performance and quality of equipment, the applicant's
willingness and ability to meet construction requirements and all other limitations and
requirements pertaining to the Franchise, and all other matters deemed pertinent by the City for
protecting the interests of the City and the public.
(E) Any decision of the City Council concerning the granting or denial of a Franchise
pursuant to this chapter shall be final.
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SECTION 12, FRANCHISE RENEWAL.
Franchise renewals shall be processed and reviewed in accordance with then applicable law. The
City and Grantee, by mutual consent, may enter into renewal negotiations at any time during the
term of the Franchise.
SECTION 13. MULTIPLE FRANCHISES.
(A) The City may in its sole discretion limit the number of Franchises granted at any
one time based upon its consideration of all appropriate criteria which shall include but not be
limited to the following:
(1) The capability of the Public Rights -of -Way to accommodate the facilities
of any proposed additional Cable Systems.
(2) The advantages and disadvantages that may result from additional Cable
System competition.
(B) The City may require that any Grantee be responsible for its own underground
trenching and any associated costs if, in the City's opinion, the Public Rights -of -Way in any area
do not feasibly and reasonably accommodate the additional cables, machinery, equipment, or
other items contemplated in connection with the construction, maintenance and operation of a
proposed new Cable System. In addition, Grantee shall comply with applicable federal and state
laws regarding pole attachments.
SECTION 14. FRANCHISE APPLICATION PROCESSING COSTS.
(A) All charges and fees incidental to awarding, renewing, extending and/or enforcing
any Franchise shall be paid by the Franchisee or applicant. No application shall be considered
without payment of a deposit with the City covering such fee. If the City's actual costs in
processing and reviewing the application are less than the amount of the fee, any remaining
funds from the fee shall be refunded to the applicant within 60 days after final approval or denial
of their application. In the event that the deposit is less than the City's actual costs, Grantee shall
pay such additional costs to the City within 30 days after written notice from the City that such
additional payment is required. If payment of such amount is not made within such time, the
City shall cease all further proceedings connected with the application.
(B) Any application fees are exclusive of Grantee's obligation to pay other costs and
fees required by this chapter, the Franchise Agreement or the Franchise, including without
limitation construction inspection fees, permit fees, and Franchise fees.
SECTION 15. FRANCHISE FEE FOR CABLE SERVICES.
(A) As compensation for any Franchise granted, and in consideration of permission to
use the Public Right -of -Way in the operation of its Cable System, and because the City will incur
costs (other than application fees) in regulating and administering the Franchise, Grantee shall
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pay to the City a Franchise fee in the amount equal to five percent of Grantee's Gross Revenues,
or such other amount as the City Council may set by resolution or specify in the Franchise
Agreement.
(B) The Franchise fee assessed shall be paid quarterly, to be received by the City
Treasurer not later than 45 days after the close of each quarter of Grantee's fiscal year.
(C) On a quarterly basis, Grantee shall provide the City a complete and accurate
statement verified by a financial officer of Grantee indicating Gross Revenues for the past
quarter, listing every revenue source, and depicting gross revenue computations.
(D) On an annual basis, Grantee shall file a complete and accurate statement certified
by Grantee's chief financial officer, indicating all Gross Revenues for said year, listing every
revenue source, and depicting gross revenue computations. If the City has any concerns or
objections relating to such report, the City shall have 60 days to notify Grantee and request
additional information. Grantee shall have 60 days to provide additional information to resolve
any concerns or objections to the City's satisfaction. Thereafter, the City may, at its sole
discretion, request that such statement be certified by an independent certified public accountant,
at Grantee's sole cost; provided, however, that any such request shall be made within 60 days
after Grantee's response is received.
(E) At any time during the term of a Franchise, the City shall have the right to
conduct, or require Grantee to obtain, an independent audit by certified public accountants of any
and all records of Grantee that are related to Gross Revenue reports or computations. Grantee
shall pay the costs of such audit not more frequently than once every five years or upon a
proposed transfer or change of control of the Franchise. Grantee shall cooperate with any such
audit making readily available any and all information requested by the City. The certified
public accountants shall be required to certify in the audit that the Grantee is in compliance with
this chapter and the Franchise Agreement. Grantee shall maintain in a readily accessible place
all such records for a minimum of four years after any payment period that such record pertains
to. This right shall be in addition to City's right to conduct any other audit.
(F) In the event that any Franchise fee payment is not paid by the due date, interest
shall be charged monthly at a monthly rate of one and one -half percent. In addition, if any
Franchise fee is not paid in full within 15 days after receipt of notice from the City as to the
delinquency of such payment, a late fee in amount of five percent of the delinquent amount shall
be assessed.
(G) In the event Grantee claims to have overpaid by more than five percent the
amount of Franchise fee actually due during any given quarter, it shall file an application with
the City within one year after said payment was made. The failure to timely and properly make
such claim shall constitute a waiver by Grantee of any right to such claimed overpayment,
whether by refund, offset, credit or any other accommodation. All such applications shall state
the amount of claimed overpayment, the reason for the claimed overpayment, and sufficient
documentation to allow the City to verify Grantee's claim. Upon request by the City, Grantee
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shall provide any further information that is deemed relevant by the City. All such applications
shall be considered by the City Council, and the City Council's decision with respect to such
applications shall be final.
SECTION 16. CONTENTS OF CABLE TELEVISION FRANCHISE
(A) The terms and provisions of a Franchise Agreement for the operation of a Cable
System may include, without limitation, the following subject matters:
(1) The nature, scope, geographical area, and duration of the Franchise.
(2) The applicable Franchise fee to be paid to the City, including the
percentage amount, the method of computation, and the time for payment.
(3) Requirements relating to compliance with and implementation of state and
federal laws and regulations pertaining to the operation of the Cable System.
(4) Requirements relating to the construction, upgrade, or rebuild of the Cable
System, as well as the provision of special services, such as outlets for public buildings,
emergency alert capability, and parental control devices.
(5) Requirements relating to the maintenance of a performance bond, a
security fund, a letter of credit, or similar assurances to secure the performance of the Grantee's
obligations under the Franchise Agreement.
(6) Requirements relating to liability insurance, workers' compensation
insurance, and indemnification.
(7) Additional requirements relating to consumer protection and customer
service standards, including the resolution of Subscriber complaints and disputes and the
protection of Subscribers' privacy rights.
(8) Requirements relating to the Grantee's support of local cable usage,
including the provision of Public, Educational, and Government Access Channels, the coverage
of public meetings and special events, and financial or technical support for Public, Education,
and Governmental Access uses.
(9) Requirements relating to construction, operation, and maintenance of the
Cable System within the Public Rights -of -Way, including compliance with all applicable
building codes and permit requirements, the abandonment, removal, or relocation of facilities,
and compliance with FCC technical standards.
(10) Requirements relating to recordkeeping, accounting procedures, reporting,
periodic audits, and performance reviews, and the inspection of Grantee's books and records.
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(11) Acts or omissions constituting material breaches of or defaults under the
Franchise Agreement, and the applicable penalties or remedies for those breaches or defaults,
including fines, penalties, liquidated damages, suspension, revocation and termination.
(12) Requirements relating to the sale, assignment, or other transfer or change
in control of the Franchise.
(13) The Grantee's obligation to maintain continuity of service and to
authorize, under certain specified circumstances, the City's operation and management of the
Cable System.
(14) Such additional requirements, conditions, policies, and procedures as may
be mutually agreed upon by the parties to the Franchise Agreement and that will, in the judgment
of the City, best serve the public interest and protect the public health, welfare, and safety.
SECTION 17. BREACH OF FRANCHISE; GROUNDS FOR ASSESSMENT OF PENALTIES
AND FRANCHISE REVOCATION.
(A) In addition to all other rights and powers retained by the City under this chapter or
otherwise, the City reserves the right to terminate any Franchise and all rights and privileges of
Grantee, revoke any Franchise, or assess damages or penalties against Grantee, in the event of
any material breach of its terms and conditions. A material breach by Grantee shall include, but
not be limited to, the following:
(1) Violation of any material provision of this chapter, the Franchise
Agreement or any material rule, order, regulation or directive issued in connection with the
Franchise;
(2) Evasion of any material provision of this chapter or the Franchise
Agreement, or the practice of fraud or deceit upon the City or its Subscribers and customers;
(3) Material misrepresentation of fact in an application for a new Franchise,
renewal or transfer of a Franchise, whether by act or omission;
(4) Failure to pay any Franchise fee when said payment is due;
(5) Failure to restore Cable Service after 72 consecutive hours of interrupted
Cable Service, except in the event that the City approves in writing a longer period of
interruption after making a determination that there exists just cause for such longer period of
interruption;
(6) Failure to provide at least 80% of subscribed Cable Services over the
Cable System for a period of five days, except in the event that the City approves in writing a
longer period of interruption after making a determination that there exists just cause for such
longer period of interruption;
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(7) Failure to substantially meet customer service standards established in the
Franchise over any consecutive three -month period of time; per Section 49
(8) Failure to initiate or Complete System Construction, or reconstruction
within the time set forth in the Franchise, unless the City Council expressly approves the delay
by motion or resolution, due to the occurrence of conditions beyond Grantee's control;
(9) Failure to provide or maintain in full force and effect at all times any
insurance coverage, letter of credit or bonds required by the Franchise Agreement;
(10) Violation of orders or rulings of any regulatory body having jurisdiction
over Grantee relating to the Franchise;
(11) Failure to provide, upon written request, data, documents, reports or
information; and
(12) Failure to pay debts and obligations as they mature in accordance with
normal business practices; assignment of Grantee or its assets for the benefit of its creditors;
dissolution, liquidation or ceasing to conduct business; application by Grantee for (or consent by
Grantee to) the appointment of a receiver, trustee, liquidator; or the filing of a bankruptcy
petition by Grantee to the extent permitted by federal law or the sale of all or substantially all of
Grantee's assets.
SECTION 18. PROCEDURE FOR ADJUDICATION OF BREACHES OF THE FRANCHISE.
(A) Prior to imposing any liquidated damages, sanction or penalty upon Grantee,
including termination or revocation of the Franchise, the City Manager, shall demand in writing
that Grantee cure such breach or diligently commence a cure of such breach within a specified
period, which period shall not be less than 30 days following notification. However, only 15
days notice shall be required in the case of failure to pay monies due. In addition, the City may,
in an emergency, prescribe a notice less than 30 days consistent with the nature of the
emergency. An emergency under this subsection (A) means an occurrence or condition that
creates an actual or imminent danger to life or property.
(B) Should Grantee fail to provide sufficient written proof within the specified cure
period that corrective action has been taken, or that corrective action is being actively and
expeditiously pursued by Grantee, then the City Manager may, in his or her sole discretion, elect
to either place the issue of termination, revocation or other penalty before an appropriate hearing
officer for his or her determination pursuant to section 19 or the City Council pursuant to section
20 of this Ordinance.
(C) The City Council, the City Manager, or any hearing officer authorized to act
pursuant to this ordinance shall have the power to issue subpoenas in order to carry out the fact-
finding activities authorized by this Ordinance. The process for the issuance and enforcement of
such subpoenas shall be governed by the California Code of Civil Procedure.
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SECTION 19. HEARING OFFICER PROCEDURES.
(A) The City Manager may, at his or her sole discretion and in lieu of the procedures
set forth in Section 20, refer to a hearing officer any controversy or claim arising out of or
relating to the Franchise or its existence, construction, interpretation, performance, enforcement,
operation, breach, continuance or termination. Such hearing proceedings shall be initiated by the
City Manager by written notice to Grantee.
(B) The procedures set forth in Section 49, subdivisions (13)(2)(a) -(o inclusive shall
govern the conduct of such administrative hearing.
(C) The hearing officer shall be vested with quasi - judicial authority, and shall be
authorized to:
(1) order Grantee to undertake remedial action to cure any breach of its
obligations under its Franchise,
(2) assess liquidated damages and/or levy a penalty upon Grantee in
accordance with the terms of this chapter and the Franchise Agreement,
(3) determine that Grantee has not violated any of its obligations under its
Franchise and/or
(4) recommend to the City Council grounds for the revocation of the
Franchise.
(D) Failure of Grantee to fully and promptly comply with an order of a hearing officer
shall be deemed a material breach of the Franchise.
SECTION 20. CITY COUNCIL HEARING PROCEDURES.
(A) In the event the City Manager elects, in his sole and absolute discretion to refer a
matter to the City Council pursuant to Section 18, the City Council shall hold a public hearing to
determine whether Grantee materially breached the Franchise and the appropriate penalty to be
imposed, if any, as a result of such breach. The City shall cause to be served upon Grantee, at
least ten days prior to the date of such hearing, written notice of any intent to terminate the
Franchise and the time and place of the hearing. Grantee may appear at such hearing and present
such evidence, orally or in writing that it deems relevant and appropriate to the Council's
deliberations. Based on the evidence presented at the hearing, the City Council shall determine,
in writing, in its discretion whether or not a material breach occurred and whether to terminate
the Franchise or take other appropriate action.
(B) Should the City Council find that there has been a material breach of the
Franchise, but that termination of the Franchise is inappropriate, then the Council may assess and
levy or impose such other relief as the Council deems appropriate, including, but not limited to,
any relief specified in Sections 19(C), 21 or any combination thereof.
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(C) The City shall cause Grantee to be served with written notice of any action taken
by the City Council following such public hearing. The decision of the City Council as to such
matters shall be final, but may be challenged by Grantee in a court of competent jurisdiction.
(D) Nothing herein is intended to limit the City Council's right to make other
determinations that are reasonably related to the Franchise, or to seek any other appropriate relief
to which the City may be entitled, at law or equity, as a result of any breach by Grantee of its
obligations under the Franchise.
SECTION 21. PENALTIES FOR BREACH OF THE FRANCHISE.
The hearing officer or City Council may impose the following penalties for any breach of the
Franchise, except any breach of Subscriber service standards, which shall be governed by
Section 49 of this Ordinance:
(A) Up to $500 for each day of each material breach, or such other amount provided
in the Franchise Agreement.
(B) For a second material breach of the same nature occurring within 12 months
where a fine or penalty was previously assessed, $1,000 for each day of each material breach.
(C) For a third or further material breach of the same nature occurring within 12
months of the first such breach, where a fine or penalty was previously assessed, up $2,000 for
each day of each material breach.
SECTION 22. ALTERNATIVE REMEDIES.
The remedies provided in this chapter are cumulative and in addition to all other rights the City
may have at law or equity or under the Franchise Agreement, including but not limited, to
liquidated damages, which remedies may be exercised at any time. In no event shall the amount
of any insurance, bond, letter of credit or any other security instrument be construed to limit
Grantee's liability for damages.
SECTION 23. REMOVAL AND ABANDONMENT; PURCHASE OF SYSTEM.
(A) Subject to applicable law, in the event that a Franchise is terminated, revoked, or
is not renewed upon expiration, then Grantee shall, upon demand of the City, and at its sole
expense, promptly remove all or any portion of its Cable System. In removing its Cable System,
Grantee shall restore all streets to the City's standard specifications and repair any damage to
utilities or other infrastructure caused by such removal. The liability, indemnity, insurance,
security fund and bonds required under the Franchise shall continue in full force and effect until
such removal is accepted as complete by the City.
(B) Subject to applicable law, in the event that a Franchise is not renewed and the
City acquires ownership of a Cable System or effects a transfer of ownership of a Cable System
to another Person, any such acquisition or transfer shall be at fair market value, determined on
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the basis of the Cable System valued as a going concern, but with no value allocated to the
Franchise itself. If a Franchise is revoked for cause and the City acquires ownership of the Cable
System or effects a transfer of ownership of the Cable System to another Person, any such
acquisition or transfer shall be at an equitable price. The value of a Cable System (fair market
value or equitable price) shall be determined by an appraisal committee consisting of three
disinterested appraisers. The City and Grantee shall each select one appraiser, and the two
selected appraisers shall agree upon and appoint a third appraiser.
(C) If a Grantee's plant, or a portion thereof, is deactivated for a continuous period of
30 days, (except for reasons beyond the Grantee's control), and without prior written notice to
and approval by City, then the Grantee must, at City's option and demand, and at the sole
expense of the Grantee, promptly remove all of the Grantee's property from any streets or other
Public Rights -of -Way. The Grantee must promptly restore the streets or other public areas from
which its property, including Distribution Facilities, has been removed to the condition existing
prior to the Grantee's use.
(D) City may, upon written application by a Grantee, approve the abandonment in
place by a Grantee of any property, under such terms and conditions as City may approve. Upon
City- approved abandonment in place of any property, the Grantee must cause to be executed
such instruments as the City may prescribe in order to transfer and convey ownership of the
abandoned property to the City.
SECTION 24. RECEIVERSHIP AND FORECLOSURE
(A) Subject to applicable provisions of the United States Bankruptcy Code, any
Franchise shall, at the option of the City, cease and terminate 120 days after the appointment of a
receiver or trustee to take over and conduct the business of Grantee whether in a receivership,
reorganization, bankruptcy or other action or proceeding unless such receivership or trusteeship
shall have been vacated prior to the expiration of said 120 days, or unless:
(1) Such receiver or trustee shall have, within 120 days after his or her
election or appointment, fully complied with all terms of the Franchise and remedied all breaches
of the Franchise or provided a plan for the remedy of such breaches which is approved in writing
by the City; and,
(2) Such receiver or trustee shall, within said 120 days, execute an agreement
duly approved by the Court having jurisdiction, under which such receiver or trustee agrees to be
bound by each and every term, provision and limitation of the Franchise.
(B) Upon the foreclosure or other judicial sale of all or a substantial part of a Cable
System, Grantee shall notify the City of such fact, and such notification shall be treated as a
notification that a change in ownership of Grantee has taken place and the provisions of this
chapter governing such changes shall apply.
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SECTION 25. UNDERGROUNDING.
(A) At no time shall Grantee place cable underground without appropriate
authorization from the City.
(B) The Cable System shall be placed underground in all portions of the Franchise
area where either telephone or electric lines are underground. Whenever the poles on which the
Cable System is constructed are eliminated, Grantee shall concurrently replace its aerial facilities
with underground facilities. At no time shall the Cable System be the only aerial facility in any
given area.
(C) Where the Cable System is installed underground, line extenders, amplifiers, taps,
power supplies, traps and related electronic equipment and components may be placed in
appropriate housings above the surface of the ground to the extent that the method employed is
compliant with any and all applicable City, state, federal or other regulations, and consistent with
any other generally applicable guidelines, policies or procedures that may, from time to time, be
adopted by the City or other applicable government agency. Grantee shall provide a procedure
for undergrounding taps and pedestals, the cost of which the Subscriber will bear, and relocating
the taps and pedestals within the technical constraints of the Cable System.
SECTION 26. USE OF POLES.
Grantee shall be authorized to utilize existing poles, conduit, and other facilities of a public
utility, but shall not be authorized to construct or install any new, different, or additional poles in
any City streets without prior written approval by the City.
SECTION 27. CONSTRUCTION STANDARDS.
Grantee shall install and maintain its wires, cables, fixtures, and other equipment in accordance
with applicable California Public Utilities Commission pole attachment standards, electrical
codes and industry standards of the Cable television industry generally applicable to the type of
Cable System which Grantee has constructed, owns or operates any applicable pole agreements,
and all Franchise Agreement requirements. Grantee shall adhere to all building and zoning
regulations currently in force or hereafter enacted. Grantee shall repair and restore any cuts
and/or trenching in the roadway or sidewalks to City standards. Grantee shall locate and
maintain its lines, cables, and other appurtenances, on public property, in such a manner as to
cause no unreasonable interference with the use of such public property by any Person.
SECTION 28. APPROVALS.
The City Engineer shall approve the location and method of construction of all underground
facilities and equipment located on Public Right -of -Ways (including any above -grade portion of
such facilities and equipment). The City Engineer also shall approve the location and installation
of all new aerial facilities. All construction shall be subject to City permit and inspection fees as
may be required by other applicable laws or regulations.
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SECTION 29. SUBMISSION OF DRAWINGS.
Grantee shall file with the City "as- built' drawings of the entire Cable System, excluding
technical specifications. Additionally, within 30 days after completion of any material
modification of the Cable System (e.g., a system rebuild or Distribution Facility replacement),
Grantee shall file with the City "as- built' drawings, excluding technical specifications, of the
modified Cable System. The City may require that the "as- built' drawings be submitted in an
electronic format specified by the City.
SECTION 30. RELOCATION OF FACILITIES AND EQUIPMENT.
(A) Grantee shall remove or relocate at its sole cost any facilities installed, used or
maintained in connection with the Franchise if and when such removal or relocation is made
necessary by any project. For purposes of this section, the word "project' means any change of
grade, alignment or width of any public street, way, alley or place, including but not limited to,
the construction of any subway or viaduct, that the City may initiate, either by or through itself
or any redevelopment agency, community facility district, assessment district, undergrounding
district, reimbursement agreement or generally applicable impact fee program.
(B) In the event that such removal or relocation is required, Grantee shall commence
physical fieldwork on the removal or relocation on or before 120 days after written notice of
such requirement is provided by the City Manager. If, despite its reasonable efforts, Grantee is
unable to commence removal or relocation within such period, Grantee shall provide the City
Manager with written notice explaining in detail the reasons for the delay and a date certain upon
which such removal or relocation is expected to commence. Grantee shall diligently proceed and
promptly complete all such removal or relocation after it is commenced.
SECTION 31. MAINTENANCE.
Should Grantee fail, refuse or neglect to properly perform any maintenance or construction work
required by the Franchise following due notice from the City and a reasonable opportunity to
cure as provided for under this chapter, or should Grantee fail to commence performance of such
work within the required period of time, or fail to diligently proceed and promptly complete such
work thereafter, the City Manager may, upon five days prior written notice to Grantee (except in
cases of emergency), cause such work or other act to be completed in whole or in part by the
City forces or others, and upon so doing shall submit to Grantee an itemized statement of the
costs thereof. Grantee shall pay to the City the entire amount due, without offset or deduction,
within thirty (30) days from the date of such statement.
SECTION 32. OPERATIONAL STANDARDS
(A) Grantee must maintain the necessary facilities, equipment, and personnel to
comply with the following consumer protection and service standards under "normal operating
conditions" as that term is defined below in subsection (D):
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(1) Provide sufficient toll -free telephone line capacity during normal business
hours to ensure that telephone calls are answered promptly. Telephone answer time by a
customer service representative, including wait time, shall not exceed 30 seconds when the
connection is made. Callers who must be transferred may not be required to wait more than 30
seconds before being connected to a service representative.
(2) Under normal operating conditions, callers may not receive a busy signal
more than three percent of the time, measured on a quarterly basis.
(3) Provide emergency toll -free telephone line capacity on a 24 -hour basis,
including weekends and holidays. After normal business hours, the telephone calls may be
answered by a service or an automated response system, including an answering machine. Calls
received after normal business hours must be responded to by a trained company representative
on the next business day.
(4) Provide a conveniently - located local business and service or payment
office open during normal business hours at least eight hours daily on weekdays, and at least four
hours weekly on evenings or weekends, and adequately staffed with trained customer service
representatives to accept subscriber payments and to respond to service requests, inquiries, and
complaints.
(5) Provide an emergency system maintenance and repair staff, capable of
responding to and repairing major system malfunctions on a 24 -hour per day basis.
(6) Maintain a trained installation staff to provide service to any subscriber
requiring a standard installation within seven days after receipt of a request, or such longer time
as may be requested by the subscriber, in all areas where trunk and feeder cable have been
activated. "Standard installations" are those that are located up to 150 feet from the existing
distribution system, unless otherwise defined in the franchise agreement.
(7) The Grantee must schedule, within a specified four -hour time period
Monday through Saturday (legal holidays excluded), all appointments with subscribers for
installation of service, service calls, and other activities at the subscriber's location. The Grantee
may schedule installation and service calls outside of normal business hours for the convenience
of the subscriber. The Grantee may not cancel an appointment with a subscriber after the close
of business on the business day prior to the scheduled appointment. If a Grantee representative
is delayed in keeping an appointment with a subscriber and will not be able to honor the
scheduled appointment, the subscriber must be contacted prior to the time of the scheduled
appointment, and the appointment must be rescheduled, as necessary, at a time that is convenient
for the subscriber. The Grantee must undertake appropriate quality control measures to ensure
that the customer is satisfied with the work.
(8) Subscribers who have experienced a late or a missed appointment due to
the fault of the Grantee will either receive an installation free of charge or a $20 credit.
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(9) Upon a subscriber's request, the Grantee will arrange for pickup or
replacement of converters or other equipment provided by the Grantee at the subscriber's address
within 14 days after the request is made if the subscriber is mobility- limited.
(B) Under normal operating conditions, the standards of subparagraphs (1), (2), (3),
(4) and (7) above must be met not less than ninety percent of the time, measured on a quarterly
basis.
(C) As used in this paragraph (A), the term "normal business hours" means those
hours during which most similar businesses in the community are open to serve customers. In all
cases, `normal business hours" must include some evening hours at least one night per week
and/or some weekend hours.
(D) As used in this paragraph (A), the term `normal operating conditions" means
those service conditions that are within the control of the cable operator. Conditions that are not
within the control of the cable operator include, but are not limited to, natural disasters, civil
disturbances, power outages, telephone network outages, and severe or unusual weather
conditions. Conditions that are ordinarily within the control of the cable operator include, but
are not limited to, special promotions, pay - per -view events, rate increases, regular peak or
seasonal demand periods, and maintenance or upgrade of the cable system.
SECTION 33. SERVICE STANDARDS
(A) The Grantee will render efficient service, make repairs promptly, and interrupt
service only for good cause and for the shortest time possible. Except in emergency situations,
scheduled interruptions will occur during a period of minimum use of the cable system,
preferably between midnight and 6:00 a.m. Unless the scheduled interruption lasts for no more
than two hours and occurs between midnight and 6:00 a.m. (in which event 24 -hours prior notice
must be given to the City), 48 -hours prior notice must be given to subscribers.
(B) The Grantee will maintain a repair force of technicians who will respond to
subscriber requests for service within the following time frames:
(1) For a system outage: Within two hours, including weekends, of receiving
subscriber calls or requests for service that by number identify a system outage of sound or
picture of one or more channels, affecting five or more subscribers of the system.
(2) For an isolated outage: Within 24- hours, including weekends, of receiving
requests for service identifying an isolated outage of sound or picture for one or more channels.
(3) For inferior signal quality: No later than the following business day,
excluding Sundays and holidays, after a request for service identifying a problem concerning
picture or sound quality.
(C) The Grantee will be deemed to have responded to a request for service under the
provisions of this paragraph (B) when a technician arrives at the service location and begins
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work on a problem that cannot be corrected from a remote location. If a subscriber is not home
when the technician arrives, the technician must leave written notification of arrival.
(D) The Grantee may not charge for the repair or .replacement of defective or
malfunctioning equipment provided by the Grantee to subscribers, unless the defect or
malfunction was caused by the subscriber.
(E) The Grantee must determine the nature of the problem within 24 hours after
commencing work and resolve all cable system related problems within three business days,
unless technically infeasible.
SECTION 34. BILLING AND INFORMATION STANDARDS
(A) Subscriber bills must be clear, concise, and understandable. Bills must be fully
itemized, with itemizations including, but not limited to, basic and premium service charges and
equipment charges. Bills also must clearly delineate all activity during the billing period,
including optional charges, rebates, and credits.
(B) The first billing to a subscriber after a new installation or service change must be
prorated based upon when the new or changed service commenced. Subscribers must not be
charged a late fee or otherwise penalized for any failure attributable to the Grantee, including the
failure to timely or correctly bill the subscriber.
(C) In, case of a billing dispute, the Grantee must respond in writing to a written
complaint from a subscriber within 10 days after receiving the complaint at the office specified
on the billing statement for receiving that complaint.
(D) Upon request by a subscriber, credits or refunds must be provided by Grantee to
subscribers who experience an outage, interruption, or disconnection of service of four or more
consecutive hours, provided that such loss of service is neither caused by the subscriber nor
attributable to scheduled repairs, maintenance, or construction in circumstances where Grantee
has provided advance written notice to a subscriber, and the loss of service does not exceed the
time period specified by Grantee. For subscribers terminating service, credits or refunds must be
issued promptly, but no later than 30 days after the return of any Grantee - supplied equipment.
(E) The Grantee must provide written information on each of the following matters at
the time of the installation of service, at least annually to all subscribers, and at any time upon
request:
(l) Products and services offered.
(2) Prices and options for programming services and conditions of subscription to
programming and other services.
(3) Installation and service maintenance policies
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(4) Instructions on the use of the cable service.
(5) Channel positions of programming carried on the system.
(6) Billing and complaint procedures, including the address and telephone number of
the City's office designated for dealing with cable - related issues.
(7) Consumer protection and service standards and penalties for noncompliance.
(F) Subscribers must be notified of any changes in rates, programming services, or
channel positions as soon as possible through announcements on the cable system and in writing.
Notice must be given to subscribers a minimum of 30 days in advance of those changes if the
change is within the control of the Grantee. In addition, Grantee will endeavor to notify the City
of those changes at least five working days before subscribers are notified.
(G) The Grantee must maintain a public file containing all notices provided to
subscribers under these consumer protection and service standards and all published promotional
offers made by Grantee to subscribers. These documents must be maintained for a minimum
period of two years.
SECTION 35. VERIFICATION COMPLIANCE WITH STANDARDS
(A) Upon 30 days prior written notice, the City may require the Grantee to provide a
written report demonstrating its compliance with any of the consumer service standards specified
in this section. The Grantee must provide sufficient documentation to enable the Grantor to
verify compliance.
(B) A repeated and verifiable pattern of noncompliance with the consumer protection
and service standards of this section, after the Grantee's receipt of written notice and an
opportunity to cure, may be deemed a material breach of the franchise agreement.
SECTION 36. SUBSCRIBER COMPLAINTS AND DISPUTES
(A) The Grantee must establish written procedures for receiving, acting upon, and
resolving subscriber complaints without intervention by the City. The written procedures must
prescribe the manner in which a subscriber may submit a complaint, either orally or in writing,
specifying the subscriber's grounds for dissatisfaction. The Grantee must file a copy of these
procedures with the City. These procedures must include a requirement that the Grantee respond
in writing to any written complaint from a subscriber within 10 days after receiving the
complaint at the office specified on the billing statement for receiving that complaint, as
provided for above in Section 32(A)(4).
(B) Upon request, and subject to applicable law protecting subscriber privacy rights,
the City has the right to review the Grantee's response to subscriber complaints.
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(C) All subscribers have the right to continue receiving service so long as their
financial and other obligations to the Grantee are honored. If the Grantee elects to rebuild,
modify, or sell the system, or if the City gives notice of intent to terminate or not to renew the
franchise, the Grantee must act so as to ensure that all subscribers receive service while the
franchise remains in force.
(D) Upon a change of control of the Grantee, or if a new operator acquires the cable
system, the original Grantee must cooperate with the City, the new Grantee, or the new operator
in maintaining continuity of service to all subscribers. During that transition period, the Grantee
is entitled to the revenues derived from its operation of the cable system.
SECTION 37. DISCONNECTION /DOWNGRADES
(A) A subscriber may terminate or downgrade service at any time, and the Grantee
must promptly comply with the subscriber's request within seven days or at any later time
requested by the subscriber. No period of notice prior to voluntary termination or downgrade of
service may be required of subscribers. Grantee will impose no charges for the voluntary
termination or downgrade of service unless a visit to the subscriber's premises is required to
remove a converter box or other equipment or property owned by Grantee. Grantee may, in
accordance with applicable law, charge a fee to downgrade service if a service call is required.
(B) The Grantee may disconnect a subscriber's service in compliance with paragraphs
(i), 0), and (k) of Section 53088.2 of the California Government Code. If service is disconnected
for nonpayment of past due fees or charges, the Grantee must promptly reinstate service upon
payment in full by the subscriber of all such fees and charges, including late charges.
(C) Notwithstanding the requirements of subsection (B) above, the Grantee may
immediately disconnect service to a subscriber if the subscriber is damaging or destroying the
Grantee's cable system or equipment.
(D) The Grantee may also disconnect service to a subscriber when it causes signal
leakage exceeding federal limits. If service is disconnected, the Grantee will immediately
resume service without charge upon the satisfactory correction of the signal leakage problem if
the signal leakage problem is attributable to the Grantee.
(E) The Grantee may also disconnect service in case where customers are stealing
service or have threatened Grantee's personnel with physical violence.
(F) Upon termination of service to a subscriber, the Grantee will remove its
equipment from the subscriber's premises within 30 days. The equipment will be deemed
abandoned if it is not removed within such time period unless the Grantee has been denied access
to the subscriber's premises.
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SECTION 38. NEGATIVE OPTION BILLING PROHIBITED
No charge may be imposed for any service or equipment that the subscriber has not affirmatively
selected. Payment of the regular monthly bill will not by itself constitute an affirmative
selection.
SECTION 39. DEPOSITS
Grantee may require a reasonable, nondiscriminatory deposit on equipment provided to
subscribers. Such deposits must be placed in an interest - bearing account. The deposit must be
returned, with interest earned to the date of repayment, within 30 days after the equipment is
returned to the Grantee.
SECTION 40. PARENTAL CONTROL OPTIONS
Grantee must provide parental control devices at no charge to all subscribers who desire to block
the video or audio portion of any pay channels providing adult programming that the subscriber
finds objectionable. For other programming, such devices will be provided at a reasonable
charge to the subscriber.
SECTION 41. ADDITIONAL REQUIREMENTS
(A) All officers, agents, and employees of the Grantee, or of its contractors or
subcontractors, who, in the normal course of work come into contact with members of the public,
or who require entry onto subscribers' premises, must display a photo- identification card. The
Grantee must account for all identification cards at all times. All vehicles of the Grantee or its
subcontractors must be clearly identified as vehicles engaged in providing services for the
Grantee.
(B) Additional standards relating to service, consumer protection, and response by the
Grantee to subscriber complaints not otherwise provided for in this section may be adopted by
ordinance, and the Grantee must comply with those standards in the operation of the cable
television system. A verified and continuing pattern of noncompliance may be deemed a
material breach of the franchise agreement, provided that the Grantee receives written notice and
an opportunity to cure before any penalty or other remedy is imposed.
SECTION 42. PENALTIES FOR NONCOMPLIANCE
(A) Purpose
The purpose of this paragraph is to authorize the imposition of monetary penalties for the
violation of the customer service standards established by this Ordinance. The imposition of
penalties authorized by this section 42 will not prevent the City or any other affected party from
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exercising any other remedy to the extent permitted by law, including, but not limited to, any
judicial remedy as provided below in subsection (13)(4) or otherwise by this Ordinance.
(B) Administration and Appeals.
(1) The City Manager or the City Manager's designee is authorized to
administer this section 42. Decisions by the City Manager to assess monetary penalties against
the Grantee must be in writing and must contain findings supporting the decisions. The written
decision shall be filed with the City Clerk and a copy thereof shall be served on the Appellant in
accordance with Section 1094.6 of the California Code of Civil Procedure.
(2) If the Grantee or any interested person ( "Appellant ") is aggrieved by a
decision of the City Manager made pursuant to this Section, the aggrieved party may, within 10
days of the written decision, appeal that decision in writing to the City Clerk. Such appeal shall
be in a form prescribed by the City Clerk. The appeal letter must be accompanied by the fee
established by the City Council for processing the appeal. The City Clerk will refer the matter to
the City Manager who will initiate the administrative hearing process outlined below:
(a) The hearing officer shall be selected by the City Manager and
compensated for the time expended in providing such service based upon a written agreement for
that purpose. The hearing officer's employment or compensation shall not be based on the
outcome rendered by the hearing officer. If the appellant so elects in writing prior to the hearing,
the appellant shall be entitled to pay for one half (1/2) of the costs of the services of the hearing
officer.
(b) The hearing shall be conducted by the hearing officer on the date,
time and place specified by the hearing officer. The hearing shall proceed solely on the issues or
defenses raised in the request for a hearing filed by the Appellant; and all matters not contested
in said request shall be deemed admitted.
(c) The Appellant shall have the burden to establish, by a
preponderance of the evidence, that either: (1) the City Manager has proceeded without, or in
excess of jurisdiction; (2) there was not a fair trial; or (3) there was any prejudicial abuse of
discretion. Abuse of discretion is established if the City Manager has not proceeded in the
manner required by law, the decision is not supported by the findings, or the findings are not
supported by the evidence. The City Manager's written decision and findings shall be admitted
into evidence and shall constitute prima facie evidence of all matters contained therein. The
parties may present such other evidence and reports as may be necessary or helpful to the hearing
officer to resolve the issues raised by the citee.
(d) The parties shall be given the opportunity to testify and to present
evidence relevant to the matters raised in the appeal.
(e) The City Manager's written decision and findings, and other
reports prepared by the City Manager, or at his or her request, concerning the alleged violation or
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violations or their attempted correction shall be accepted by the hearing officer as prima facie
evidence of the violation or violations.
(f) The hearing shall be conducted informally and the rules of
evidence need not be followed; provided however that the decision of the hearing officer on any
material issue may not be based upon hearsay evidence alone. The hearing officer may adopt
such supplementary rules of procedure and evidence as may be useful in a determination of the
issues involved, to the extent such rules are not otherwise provided for herein.
(g) The failure of the Appellant to appear at the hearing shall
constitute a waiver of his or her contest to the City Manager's decision and a failure to exhaust
administrative remedies concerning the City Manager's decision. Such failure to appear shall
constitute an admission of the truth of all matters contained in the City Manager's decision,
which shall be ordered in the decision of the hearing officer.
(h) The hearing officer may continue the hearing upon the request of
the Appellant, or the Appellant's representative, or the representative of the City, or on the
hearing officer's own motion, upon a showing of good cause. All continuance requests shall be
made in writing. If the continuance is granted, a new hearing date shall be set, which continued
hearing date shall be within fifteen days.
(i) After considering all the evidence and testimony submitted at the
heating, the hearing officer shall issue his or her written decision within five business days
following the conclusion of the hearing. The decision of the hearing officer shall, either uphold
or deny the City Manager's decision or any portion thereof and state the facts and reasons
supporting the decision. The hearing officer also shall order any remedy necessary to effectuate
the hearing officer's decision, including, but not limited to, a revision of the amount of money
owed by the Grantee after due consideration of the circumstances pursuant to subparagraph
(13)(6)(b), below. The written decision shall be filed with the City Clerk and a copy thereof shall
be served on the Appellant in accordance with Section 1094.6 of the California Code of Civil
Procedure.
0) All decisions and orders of a hearing officer shall become final
unless appealed as provided herein.
(k) The Appellant or the City may seek judicial review of the decision
of the hearing officer by filing an appeal with the Superior Court within ninety (90) in
accordance with applicable law, including the provisions of California Code of Civil Procedure
Section 1094.6. No appeal shall be permitted from a decision based upon the failure of the
Appellant to appear at the administrative hearing or upon any other waiver of the administrative
hearing by the Appellant.
(1) If an appeal of any decision or order of a hearing officer that
ordered the Appellant to pay any amount due is affirmed by the reviewing court, in whole or
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part, the court shall enter an order requiring the Appellant to pay such amount and said order
shall constitute a money judgment.
(3) Schedule of Penalties. The following schedule of monetary penalties may be
assessed against the Grantee for the material violation of the provisions of the customer service
standards set forth in this section, provided that the violation is within the reasonable control of
the Grantee:
(a) The maximum penalty for a first material violation is two hundred dollars
($200) for each day of the material violation.
(b) For a second material violation of the same nature within a 12 -month
period for which the City has provided notice and a penalty has been assessed, the maximum
penalty is five hundred dollars ($500) for each day of the material violation.
(c) For a third or further material violation of the same nature within a 12-
month period for which the City has provided notice and a penalty has been assessed, the
maximum penalty is seven hundred fifty dollars ($750) for each day of the material violation.
(4) Judicial Remedy. This paragraph does not preclude any affected party from
pursuing any judicial remedy available to that party without regard to this paragraph (k).
(5) Notice of Violation. The City must give the Grantee written notice of any alleged
violation of the consumer service standards and allow the Grantee at least 30 days from receipt
of the notice to remedy the specified violation.
(6) Assessment of Monetary Penalties.
(a) If a violation has not been corrected or cured by Grantee within the time
specified by the City, the monetary penalties specified above in subparagraph (c) may be
assessed from the date of delivery to Grantee of the City's written notice of violation.
(b) In assessing monetary penalties under this paragraph (k), the City
Manager, Hearing Officer, or the City Council, as applicable, may take into account the nature,
circumstances, extent and gravity of the violation and, with respect to the Grantee, the degree of
culpability, any history of prior violations, and such other matters as may be relevant. If
warranted under the circumstances, the monetary penalty to be assessed may be less than the
maximum penalty amount specified above in subparagraph (c).
SECTION 43. ADDITIONAL CONSUMER PROTECTION AND SERVICES STANDARDS
(A) In addition to the consumer protection and service standards that are specified above in
section 32 — section 50, the franchise agreement with a Grantee may require compliance with the
following:
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(1) Federal statutes, and the rules, regulations, and orders of the Federal
Communications Commission, including the following:
(a) The provisions of Section 76.309(c) of Title 47 of the Code of Federal
Regulations, as it now exists or may later be amended.
(b) The provisions of Section 76.630 of Title 47 of the Code of Federal
Regulations, as it now exists or may later be amended.
(c) The provisions of Section 551 of Title 47, United States Code, as it now
exists or may later be amended.
(d) The provisions of California Government Code Sections 53054, et seq.,
entitled the "Cable Television and Video Provider Customer Service and Information Act."
(e) The provisions of California Government Code Section 53088, et seq.,
entitled the "Video Customer Service Act."
(f) The provisions of California Civil Code Section 1722(b)(1) -(6) relating to
service or repair transactions between cable television companies and their subscribers.
(g) The provisions of California Penal Code Section 637.5 relating to
subscribers' rights to privacy protection.
(B) The City may, in its discretion, incorporate in a franchise agreement those customer
service and protection standards referenced above in this paragraph (A) that are the most
stringent, and that afford the greatest protection to consumers. These standards will apply, to the
extent authorized by law, to all video, voice, and data services that are provided by the Grantee
to its subscribers within the franchise service area.
SECTION 44. COMPATIBILITY WITH CONSUMER ELECTRONICS EQUIPMENT.
(A) The Grantee shall not scramble or otherwise encrypt signals carried on the basic service
tier. Requests for waivers of this prohibition must demonstrate either a substantial problem with
theft of basic tier service or a strong need to scramble basic signals for other reasons.
(B) The Grantee shall comply with equipment compatibility rules and commercial
availability of navigation equipment rules of the FCC.
(C) The Grantee shall offer Subscribers the option to receive an AB switch at the time of
initial Cable Service installation and shall provide Subscribers with written information as to
how to use such a switch. The Grantee may charge a reasonable price for said switch. Upon
Subscriber request, the Grantee shall provide an A/B switch after the initial installation of Cable
Service. If the Subscriber requests installation of such a switch (to receive broadcast television
without Cable hookup), the Grantee may charge reasonable fees for such installation and
equipment.
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SECTION 45. RATE REGULATION.
The City may regulate a Grantee's rates, charges, and prices to the maximum extent permitted by
law now or at a future time.
(A) Filing of Rates and Charges. Throughout the term of any Franchise Agreement entered
into pursuant to this chapter, Grantee shall maintain on file with the City a complete schedule of
all rates and charges related to providing Cable Services under the Franchise, in a form
satisfactory to the City.
(B) Changes in Rates and Charges. Grantee shall provide written notice to the City and
Subscribers at least thirty (30) days in advance of any proposed change in rates and charges
within the control of Grantee. Such notice shall be provided in the Subscriber's bill, or in a
separate mailing..
(C) Regulation of Equipment for Hearing- Impaired. To the extent authorized by law, the
City reserves the right to require and regulate the installation or rental of equipment that
facilitates the reception of Cable Service by hearing impaired individuals.
SECTION 46. BILLING PROCEDURES.
Billing procedures shall be as follows:
(A) Bills will be clear, concise, and understandable. Bills must be fully itemized, with
itemizations including, but not limited to, basic and premium service charges and equipment
charges. Bills will also clearly delineate all activity during the billing period, including:
(1) A list of each service or package received for that billing period;
(2) The rate or charge for each service or package received;
(3) The period of time over which said services are billed;
(4) The total charges due for the monthly period, separate from any previous balance
due;
(5) Credits posted during the month;
(i) Credits for service will be issued no later than the Subscriber's next billing
cycle following the determination that a credit is warranted.
(6) A specific date by which payment is required; and
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(7) The customer service telephone number to which billing inquiries or complaints
can be directed.
(B) A Grantee's first billing statement after a new installation or service change shall be
prorated as appropriate and shall reflect any security deposit.
(C) A Grantee's billing statement must show a specific payment due date, and no late
payment fee may be imposed on a Subscriber earlier,than thirty (30) calendar days from the due
date on the billing statement. Any balance not received within thirty (30) calendar days of the
due date may be assessed a late fee consistent with this Chapter. Any late fee assessed must
appear on the following month's billing statement.
(D) A Grantee must notify the Subscriber that he or she can remit payment in Person at the
Grantee's office located in or near the City and inform the Subscriber of the address of that
office.
(E) Every customer who pays his or her bill directly shall have at least fifteen (15) days from
the date of the bill for services is mailed to pay the listed charges. Customer payments shall be
posted promptly. The Grantee shall not terminate any residential service for nonpayment of a
delinquent account without fifteen (15) days prior written notice. Such notice shall not be mailed
until after the sixteenth (16th) day from the time the bill for services was mailed to the customer.
The Grantee may not assess a late charge earlier than the twenty- second (22nd) day from the
time the bill for services has been mailed.
(F) In case of a billing dispute, the Grantee must respond to a written complaint from a
Subscriber within thirty (30) days.
(G) At the time of the initial complaint, Grantee shall provide written or verbal notice to
customers that in the event of a billing dispute, the Grantee, upon resolution of the dispute when
Grantee is at fault, shall waive a late fee.
(H) Subscribers shall not be charged a late fee or otherwise penalized for any failure by the
Grantee, its employees, or contractors, including failure to timely or correctly bill the Subscriber,
or failure to properly credit the Subscribers for a payment made in a timely manner.
(I) Every notice of termination of service shall include: name and address of Subscriber
whose account is delinquent; the amount of the delinquency; the date by which payment is
required in order to avoid termination of service; the telephone number of the Grantee for
additional information and/or to handle complaints or initiate an investigation concerning service
and charges in question.
(J) Service may only be terminated on days and at times in which the Subscriber can reach a
Customer Service Representative of the Grantee either in Person or by telephone.
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(K) The Grantee shall afford each Subscriber of the Cable System with a right to rescind the
Subscriber's ordering of service within three (3) days after ordering, provided that such right of
rescission shall end upon activation of the service ordered.
(L) The Grantee shall assess any late fees in accordance with California law. In no event
shall a late fee exceed the maximum amount permissible under California law.
(M) Any Franchise Agreement entered into pursuant to this chapter may contain provisions
for a discount on basic and Cable programming tiers or any other Cable Services for Persons
with specific income and disability qualifications. .
(I) Grantee will set rates for equipment deposits no higher than the actual replacement value
of the equipment for which the deposit is applied. Equipment deposits shall be promptly
returned to Subscribers upon the return in good working condition to the Grantee of the
equipment for which said deposit was required.
SECTION 47. REFUNDS.
(A) Refund checks will be issued promptly, but no later than either:
(1) the Subscriber's next billing cycle following resolution of the request or thirty
(30) days, whichever is earlier, or
(2) in cases involving the return of the equipment supplied by the Grantee if service is
terminated for any reason, by the Subscriber's next billing cycle following resolution of the
request or thirty (30) days, whichever is earlier.
(B) If the Grantee does not mail a check for a refund to any Subscriber disconnecting service
with an outstanding credit within the next billing cycle or thirty days, whichever is earlier, the
Subscriber may request and is entitled to receive a ten dollar ($10.00) payment.
SECTION 48. NOTICE OF RATE INCREASES.
Grantee shall provide written notice to the City and Subscribers at least 30 days in advance of the
implementation of changes in any of its rates and charges which are not subject to regulation by
the City.
SECTION 49. NON - DISCRIMINATION AND CUSTOMER PRIVACY.
(A) Service Availability
(1) No Person, firm or corporation in the existing service area of a Grantee shall be
arbitrarily refused service; provided, however, that the Grantee shall not be required to provide
service to any Subscriber who does not pay the applicable connection fee or monthly service
charge hereby authorized.
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(2) A Grantee may not require the subscription to any tier other than the basic service
tier as a condition of access to video programming offered on a per channel or per program basis.
A Grantee may not discriminate between Subscribers to the basic service tier and other
Subscribers with regard to the rates charged for video programming offered on a per channel or
per program basis.
(3) A Grantee will abide by all customer privacy requirements of federal and State
law. At least annually, a Grantee shall provide notice in the form of a separate, written statement
to each Subscriber, which clearly and conspicuously informs the Subscriber of:
(a) the nature of personally identifiable information collected or to be
collected with respect to the Subscriber and the nature of the use of such information;
(b) the nature, frequency and purpose of any disclosure, which may be made
of such information, including the identification of the types of Persons to whom the disclosure
may be made;
(c) the period during which such information will be maintained by the
Grantee;
(d) the times and place at which the Subscriber may have access to such
information in accordance with federal and State law; and
(e) the limitations provided in federal and State law with respect to the collection and
disclosure of information by a Grantee and the right of the Subscriber under law.
(B) Data Collection.
A Grantee's data collection and dissemination practices regarding Subscribers shall be in
compliance with the Cable Act (including Section 63 1) and this Chapter.
(C) Revealing Subscriber Preferences.
(1) A Grantee shall not reveal individual Subscriber preferences, viewing habits,
beliefs, philosophy, creeds or religious beliefs to any third Person, firm, agency, governmental
unit or investigating agency without court authority or prior written consent of the Subscriber.
(2) Such written consent, if given, shall be limited to a period of time not to exceed
one (1) year or a term agreed upon by the Grantee and Subscriber.
(3) A Grantee shall not condition the delivery or receipt of Cable Services to any
Subscriber on any such consent.
(4) Such a Subscriber may revoke without penalty or cost any consent previously
made by delivering to the Grantee in writing a substantial indication of his intent to so revoke.
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(D) Revealing Subscriber Lists.
A Grantee shall not reveal, or sell, or permit the release or sale of its Subscriber list without the
prior affirmative written consent of each Subscriber, provided that the Grantee may use its
Subscriber list as necessary for the construction, marketing, and maintenance of the Grantee's
services and facilities authorized by its Franchise, and the related billing of Subscribers for Cable
Services. Consistent with applicable law, City may use Grantee's Subscribers list for the
purpose of communication with Subscribers in connection with matters relating to operation,
management, and maintenance of the Cable System.
(E) Other Persons Affected.
This Section shall apply to all of the following as well as to any Grantee:
(1) Officers, directors, employees and agents of the Grantee;
(2) General and limited partners of the Grantee;
(3) Any Person or combination of Persons owning holding or Controlling five percent
(5 %) or more of any corporate stock or other ownership interest of the Grantee;
(4) Any affiliated or subsidiary entity owned or Controlled by the Grantee, or in
which any officer, director, stockholder, general or limited partner or Person or group of Persons
owning, holding or Controlling any ownership interest in the Grantee, shall own, hold or Control
five percent (5 %) or more of any corporate stock or other ownership interest;
(5) Any Person, firm or corporation acting or serving in the capability of holding or
Controlling company of the Grantee.
SECTION 50. WRITTEN OR ORAL NOTICE TO ENTER PROPERTY.
Under Normal Operating Conditions, Grantee shall provide written or oral notice, in light of
circumstances, prior to entering any private property.
SECTION 51. NOTICE REGARDING CHANNEL SCRAMBLING.
Subscribers shall be given at least thirty (30) days written notice of any scrambling of a channel,
and any de- scrambling of a channel(s) containing R -rated or stronger programming. Subscribers
do not need to be notified of blackout periods required of the Grantee by programmers.
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SECTION 52. TENANT RIGHTS.
It is the City's intent that tenants not be discriminated against in the ability to subscribe to Cable
Services. Grantee shall be required to provide service to tenants in individual units of a multiple
housing facility with all services offered to other dwelling units within the Franchise Area, so
long as the owner of the facility consents in writing, if requested by Grantee, to the following:
(A) Grantee's providing the service to units of the facility on such terms and conditions as are
reasonable, provided that
(1) the owner of the facility shall not seek to charge Grantee any fee or consideration
for access to the facility or for the right of providing Cable Service to the dwelling units within
the facility,
(2) Grantee shall not seek to charge the owner of the facility any fee or consideration
for installing such service other than its actual costs as provided for herein, and
(3) such terms and conditions shall be in compliance with applicable law;
(B) Reasonable access to the premises by Grantee for installation, maintenance, and
inspection of the system on the premises;
(C) Reasonable conditions promulgated by Grantee to protect Grantee's equipment and to
encourage widespread use of the system;
(D) The owner shall not discriminate in rental charges, or otherwise, between tenants who
receive Cable Service and those who do not; and
(E) The owner shall provide all easements, rights -of -way, and other rights of access deemed
reasonably necessary or appropriate by Grantee for purposes of providing Cable television
service to the facility.
SECTION 53. CONTINUITY OF SERVICE MANDATORY.
(A) Subscribers shall have the right to continue to receive service so long as their financial
and other obligations to Grantee are honored. Grantee shall at all times, and under all conditions,
to the greatest extent economically and technically possible, maintain continuity of service. In
the event of an assignment of the Cable System, the assignor shall cooperate with the City and
the assignee in order to maintain continuity of service to all Subscribers.
(B) In the event Grantee willfully fails to operate the Cable System for a period of five
consecutive days without prior approval of the City, the City may, in its sole discretion, elect to
operate the Cable System or designate an operator until Grantee restores service under conditions
acceptable to the City, or until the City selects a permanent operator. During the entire period
while the City operates the Cable System on behalf of Grantee, or causes another party to do so,
the City shall be entitled to collect any and all revenues from the operation of the Cable System,
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and Grantee shall reimburse the City for all reasonable costs or damages in excess of the
revenues collected by the City that are caused by Grantee's failure to perform.
SECTION 54. APPLICABILITY.
The provisions of this chapter apply to an Open Video System Operator that intends to deliver
video programming to consumers in the City over an Open Video System.
Section 55. APPLICATION REQUIRED.
(A) Before commencing the delivery of Video Programming services to consumers in the
City over an Open Video System, the Open Video System Operator must file an application with
the City. That application must include or be accompanied by the following, as applicable:
(1) The identity of the applicant, including all Affiliates of the Applicant.
(2) Copies of FCC Form 1275, all "Notices of Intent" filed under 47 CFR
section 76.1503(b)(1), and the Order of the FCC, all of which relate to certification of the
applicant to operate an Open Video System in accordance with Section 653(a)(1) of the
Communications Act and the FCC's rules.
(3) The area or areas of the City that the applicant desires to serve.
(4) A description of the Open Video System services that will be offered by the
applicant over its existing or proposed facilities.
(5) A description of the transmission medium that will be used by the applicant to
deliver the Open Video System services.
(6) Information in sufficient detail to establish the applicant's technical qualifications,
experience, and expertise regarding the ownership and operation of the Open Video System
described in the application.
(7) Financial statements prepared in accordance with generally accepted accounting
principles that demonstrate the applicant's financial ability to:
(a) Construct, operate, maintain and remove any new physical plant that is
proposed to be constructed in the City.
(b) Comply with the City's Public, Educational, and Government Access
Channel requirements as specified below in Section 57 B(4).
(c) Comply with the City's requirement that gross revenue fees be paid in the
sum of 5 percent (5 %), as specified below in Section 57 (13)(2).
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(8) An accurate map showing the location of any existing telecommunications
facilities in the City that the applicant intends to use, to purchase, or to lease.
(9) If the applicant's operation of the Open Video System will require the
construction of new physical plant in the City, the following additional information must be
provided:
(a) A preliminary construction schedule and completion dates.
(b) Preliminary engineering plans, specifications, and a network map of any
new facilities to be constructed in the City, in sufficient detail to identify:
(i) The location and route requested for the applicant's proposed
facilities.
(ii) The locations, if any, for interconnection with the facilities of other
telecommunications service providers.
(iii) The specific structures, improvements, facilities, and obstructions,
if any, that the applicant proposes to remove or relocate on a temporary or permanent basis.
(c) The applicant's statement that, in constructing any new physical plant, the
applicant will comply with all applicable ordinances, rules, and regulations of the City, including
the payment of all required permit and processing fees.
(10) The information and documentation that is required to be submitted to the City by
a Video Provider, as specified below in paragraph (B) of Section 59.
(11) Such additional information as may be requested by the City Manager.
(12) A nonrefundable filing fee in an amount established by resolution of the City
Council.
(B) If any item of information specified above in paragraph (A) is determined under
paramount federal or state law to be unlawful, the City Manager is authorized to waive the
requirement that such information be included in the application.
SECTION 55. REVIEW OF APPLICATION.
Within 30 days after receipt of an application filed under Section 55 that is deemed to be
complete, the City Manager will give written notice to the applicant of the City's intent to
negotiate an agreement setting forth the terms and conditions under which the operation of the
proposed Open Video System will be authorized by the City. The commencement of those
negotiations will be on a date that is mutually acceptable to the City and to the applicant.
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SECTION 56. AGREEMENT REQUIRED AND FEES.
(A) No Video Programming services may be provided in the City by an Open Video System
operator unless the operator and the City have executed a written agreement, which may be
designated as a Franchise, setting forth the terms and conditions under which the operation of the
proposed Open Video System will be authorized by the City.
(B) The agreement between the City and the Open Video System operator may contain terms
and conditions that relate to the following subject matters, to the extent that such terms,
conditions, and subject matters are not preempted by federal statute or regulations:
(1) The nature, scope, and duration of the agreement, including provisions for its
renewal or extension.
(2) The obligation of the Open Video System operator to pay to the City, at specified
times, fees on the gross revenue received by the operator, as authorized by 47 CFR
section 76.1511, in accordance with the following standards and procedures:
(a) The amount of the fees on the gross revenue will be five percent (5 %), and
will be paid in lieu of the Franchise fees authorized under Section 622 of the Communications
Act.
(b) The term "OVS Gross Revenue" means all gross revenue as defined in
Section 02 and (i) all revenue all carriage revenue received from unaffiliated video
programming providers; and (ii) all other revenue derived directly or indirectly from or
attributable to the operation of Open Video system.. The term "OVS Gross Revenue" does not
include revenue, such as Subscriber or advertising revenue, collected by unaffiliated video
programming providers and other exclusions described in the definition of "Gross Revenues"
defined within Section 02 of this Ordinance
(3) The obligation of the Open Video System operator to comply with requirements
relating to information collection and recordkeeping, accounting procedures, reporting, periodic
audits, and inspection of records in order to ensure the accuracy of the fees on the OVS Gross
Revenue that are required to be paid as specified above in paragraph (13)(2).
(4) The obligation of the Open Video System operator to meet the City's
requirements with respect to Public, Educational, and Governmental Access Channel capacity,
services, facilities, and equipment, as provided for in 47 CFR section 76.1505. In this regard, the
following standards and procedures are applicable:
(a) The Open Video System operator is subject to the same Public,
Educational, and Governmental Access Channel requirements that apply within the cable
television Franchise service area with which its system overlaps.
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(b) The Open Video System operator must ensure that all Subscribers receive
all Public, Educational, and Government Access Channels within the Franchise service area in
which the City's Subscribers are located.
(c) The Open Video System operator may negotiate with the City to establish
the operator's obligations with respect to Public, Educational, and Government Access Channel
capacity, services, facilities, and equipment. These negotiations may include the City's
Franchised cable operator if the City, the Open Video System operator, and the Franchised cable
operator so desire.
(d) If the Open Video System operator and the City are unable to reach an
agreement regarding the operator's obligations with respect to Public, Educational, and
Government Access channel capacity, services, facilities, and equipment within the City's
jurisdiction, then the following obligations will be imposed:
(i) The Open Video System operator must satisfy the same Public,
Educational, and Government Access Channel obligations as the City's Franchised cable
operator by providing the same amount of channel capacity for public, educational, and
governmental access and by matching the City's Franchised cable operator's annual financial
contributions in support of Public, Educational, and Government Access services, facilities, and
equipment that are actually used by the City. For in -kind contributions, such as cameras or
production studios, the Open Video System operator may satisfy its statutory obligation by
negotiating mutually agreeable terms with the City's Franchised cable operator, so that public,
educational, and governmental access services to the City are improved or increased. If such
terms cannot be agreed upon, the Open Video System operator must pay to the City the monetary
equivalent of the Franchised cable operator's depreciated in -kind contribution, or, in the case of
facilities, the annual amortization value. Any matching contributions provided by the Open
Video System operator must be used to fund activities arising under Section 611 of the
Communications Act.
(ii) The City will impose upon the Open Video System operator the
same rules and procedures that it imposes upon the Franchised cable operator with regard to the
Open Video System operator's use of channel capacity designated for Public, Educational, and
Government Access Channel use when that capacity is not being used for such purposes.
(c) The City's Franchised cable operator is required under federal law to
permit the Open Video System operator to connect with its Public, Educational, and Government
Access Channel feeds. The Open Video System operator and the Franchised cable operator may
decide how to accomplish this connection, taking into consideration the physical and technical
characteristics of the cable and the Open Video Systems involved. If the Franchised cable
operator and the Open Video System operator cannot agree on how to accomplish the
connection, the City has the right to decide. The City may require that the connection occur on
City -owned property or on Public Rights -of -Way.
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(f) All costs of connection to the Franchised cable operator's Public,
Educational, and Government Access Channel feed must be borne by the Open Video System
operator. These costs will be counted towards the Open Video System operator's matching
financial contributions set forth above in subparagraph (d)(i).
(g) The City will not impose upon the Open Video System operator any
Public, Educational, or Government Access Channel obligations that are more favorable or less
burdensome than those imposed upon the Franchised cable operator.
(h) If there is no existing Franchised cable operator, the provisions of 47 CFR
section 76.1505(d)(6) will be applicable in determining the obligations of the Open Video
System operator.
(i) The Open Video System operator must adjust its system to comply with
new Public, Education, and Access Channel obligations imposed on the City's Franchised cable
operator following a renewal of the cable television Franchise; provided, however, that the Open
Video System operator will not be required to displace other programmers using its Open Video
System to accommodate Public, Educational, and Government Access Channels. The Open
Video System operator must comply with such new Public, Educational, and Government
Access Channel obligations whenever additional capacity is or becomes available, whether it is
due to increased channel capacity or to decreased demand for channel capacity.
(5) If the City and the Open Video System operator cannot agree on the application of
the FCC's rules regarding the Open Video System operator's obligations to provide Public,
Educational, and Government Access Channel under the provisions of subsection (4) set forth
above, then either party may file a complaint with the FCC in accordance with the dispute
resolution procedures set forth in 47 CFR section 76.1514. No agreement will be executed by
the City until the dispute has been finally resolved.
(6) If the Open Video System operator intends to maintain an institutional network,
as defined in Section 611(f) of the Communications Act, the City will require that Educational
and Government Access Channels be designated on that institutional network to the same extent
that those channels are designated on the institutional network of the City's Franchised cable
operator. In addition, to the extent authorized by federal law, the Open Video System operator
may be required by the City to satisfy the same financial obligations and other requirements that
are imposed upon the Franchised cable operator to support data - transmission and related services
that are provided by the institutional network.
(7) The authority of an Open Video System provider to exercise editorial control over
any Public, Educational, or Government use of channel capacity will be restricted in accordance
with the provisions of 47 CFR section 76.1505(f).
(8) The obligation of the Open Video System operator to comply with all applicable
federal, state, and local statutes, ordinances, and regulations relating to customer service
standards, including the Cable Television and Video Customer Service and Information Act
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(Government Code §§ 53054, et seq.), the Video Customer Service Act (Government Code
§§ 53088, et seq.), and Section 18.04.050 of Chapter 18.04 of this title.
(9) If a new physical plant is proposed to be constructed within the City, the
obligation of the Open Video System operator to comply with the following rights -of -way use
and management responsibilities that are also imposed by the City upon other
telecommunications service providers in a nondiscriminatory and competitively neutral manner:
(a) Compliance with all applicable City codes, including applications for
excavation, encroachment, and construction permits and the payment of all required permit and
inspection fees.
(b) The coordination of construction activities.
(c) Compliance with established standards and procedures for constructing
lines across private property.
(d) Compliance with all applicable insurance and indemnification
requirements.
(e) The repair and resurfacing of construction- damaged streets
(f) Compliance with all public safety requirements that are applicable to
telecommunications service providers using public property or Public Rights -of -Way.
(10) Acts or omissions constituting breaches or defaults of the agreement, and the
applicable penalties, liquidated damages, and other remedies, including fines or the suspension,
revocation, or termination of the agreement.
(11) Requirements relating to the sale, assignment, or transfer of the Open Video
System.
(12) Requirements relating to the Open Video System operator's compliance with and
implementation of state and federal laws, rules, and regulations pertaining to the operation of the
Open Video System.
(13) Such additional requirements, conditions, terms, policies, and procedures
as may be mutually agreed upon by the City and the Open Video System operator and that will,
in the judgment of the City Council, best serve the public interest and protect the public health,
welfare, and safety.
SECTION 57, OTHER MULTICHANNEL VIDEO PROGRAMMING DISTRIBUTORS.
(A) The term "Cable System" does not include a facility that serves Subscribers without using
any Public Rights -of -Way. Consequently, the categories of Multichannel Video Programming
Distributors identified below are not deemed to be "Cable Systems" and are therefore exempt
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from the City's Franchise requirements and from certain other local regulatory provisions
authorized by federal law, provided that their distribution or transmission facilities do not
involve the use of the City's Public Rights -of -Way.
(B) Multichannel multipoint distribution service ( "MMDS "), also known as "wireless cable ",
which typically involves the transmission by an FCC - licensed operator of numerous broadcast
stations from a central location using line -of -sight technology.
(C) Local multipoint distribution service ( "LMDS "), another form of over - the -air, wireless
video service for which licenses are auctioned by the FCC, and that offers video programming,
telephone, and data networking services.
(D) Direct broadcast satellite ( "DBS "), also referred to as "direct -to -home satellite services ",
which involves the distribution or broadcasting of programming or services by satellite directly
to the Subscriber's premises without the use of ground receiving or distribution equipment,
except at the Subscriber's premises or in the uplink process to the satellite. Local regulation of
direct -to -home satellite services is further proscribed by the following federal statutory
provisions:
(1) 47 U.S.C. section 303(v) confers upon the FCC exclusive jurisdiction to regulate
the provision of direct -to -home satellite services.
(2) Section 602 of the Communications Act states that a provider of direct -to -home
satellite service is exempt from the collection or remittance, or both, of any tax or fee imposed
by any local taxing jurisdiction on direct -to -home satellite service. The terms "tax" and "fee" are
defined by federal statute to mean any local sales tax, local use tax, local intangible tax, local
income tax, business license tax, utility tax, privilege tax, gross receipts tax, excise tax, franchise
fees, local telecommunications tax, or any other tax, license, or fee that is imposed for the
privilege of doing business, regulating, or raising revenue for a local taxing jurisdiction.
SECTION 58. VIDEO PROVIDERS — REGISTRATION; CUSTOMER SERVICE
STANDARDS.
(A) Unless the customer protection and customer service obligations of a Video Provider are
specified in a Franchise, with the City, a Video Provider must comply with all applicable
provisions of the following state statutes:
(1) The Cable Television and Video Customer Service and Information Act
(Government Code §§ 53054, et seq.).
(2) The Video Customer Service Act (Government Code §§ 53088, et seq.).
(B) All Video Providers that are operating in the City on the effective date of this title, or that
intend to operate in the City after the effective date of this title, and are not required under
applicable law to operate under a Franchise, license, lease, or similar written agreement with the
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City, must register with the City. The registration form must include or be accompanied by the
following:
(1) The Video Provider's name, address, and local telephone numbers.
(2) The names of the officers of the Video Provider.
(3) A copy of the Video Provider's written policies and procedures relating to
customer service standards and the handling of customer complaints, as required by California
Government Code §§ 53054, et seq. These customer service standards must include, without
limitation, standards regarding the following:
(a) Installation, disconnection, service and repair obligations, employee
identification, and service call response time and scheduling.
(b) Customer telephone and office hours.
(c) Procedures for billing, charges, refunds, and credits.
(d) Procedures for termination of service.
(e) Notice of the deletion of a programming service, the changing of channel
assignments, or an increase in rates.
(f) Complaint procedures and procedures for bill dispute resolution.
(g) The Video Provider's written acknowledgement of its obligation under
California Government Code section 53055.1 to provide to new customers a notice describing
the customer service standards specified above in subparagraphs (a) through (f) at the time of
installation or when service is initiated. The notice must also include, in addition to all of the
information described above in subparagraphs (a) through (f), all of the following:
(i) A listing of the services offered by the Video Provider that clearly
describes all levels of service and the rates for each level of service.
(ii) The telephone number or numbers through which customers may
subscribe to, change, or terminate service, request customer service, or seek general or billing
information.
(iii) A description of the rights and remedies that the Video Provider may
make available to its customers if the Video Provider does not materially meet its customer
service standards.
(h) The Video Provider's written commitment to distribute annually to its
employees and customers, and to the City, a notice describing the customer service standards
specified above in subparagraphs (a) through (f). This annual notice must include the report of
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the Video Provider on its performance in meeting its customer service standards, as required by
California Government Code section 53055.2.
(4) Unless a Video Provider is exempt under federal law from its payment, a
registration fee in an amount established by resolution of the City Council to cover the
reasonable costs incurred by the City in reviewing and processing the registration form.
(5) In addition to the registration fee specified above in subsection (4), the written
commitment of the Video Provider to pay to the City, when due, all costs and expenses
reasonably incurred by the City in resolving any disputes between the Video Provider and its
Subscribers, which dispute resolution is mandated by California Government Code
section 53088.2(o).
(C) The customer service obligations imposed upon Video Providers by the Video Customer
Service Act California Government Code § §53088 et seq.) consist of the following:
(1) Every Video Provider must render reasonably efficient service, make repairs
promptly, and interrupt service only as necessary.
(2) All Video Provider personnel contacting Subscribers or potential Subscribers
outside the office of the provider must be clearly identified as associated with the Video
Provider.
(3) At the time of installation, and annually thereafter, all Video Providers must
provide to all customers a written notice of the programming offered, the prices for that
programming, the provider's installation and customer service policies, and the name, address,
and telephone number of the City's office that is designated for receiving complaints.
(4) All Video Providers must have knowledgeable, qualified company representatives
available to respond to customer telephone inquiries Monday through Friday, excluding
holidays, during normal business hours.
(5) All Video Providers must provide to customers a toll -free or local telephone
number for installation, service, and complaint calls. These calls must be answered promptly by
the Video Providers.
(6) All Video Providers must render bills that are accurate and understandable.
(7) All Video Providers must respond promptly to a complete outage in a customer's
service. The response must occur within 24 hours of the reporting of such outage to the
provider, except in those situations beyond the reasonable control of the Video Provider. A
Video Provider will be deemed to respond to a complete outage when a company representative
arrives at the outage location within 24 hours and begins to resolve the problem.
(8) All Video Providers must provide a minimum of 30 days' written notice before
increasing rates or deleting channels. All Video Providers must make every reasonable effort to
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submit the notice to the City in advance of the distribution to customers. The 30 -day notice is
waived if the increases in rates or deletion of channels are outside the control of the Video
Provider. In those cases, the Video Provider must make reasonable efforts to provide customers
with as much notice as possible.
(9) Every Video Provider must allow every residential customer who pays his or her
bill directly to the Video Provider at least 15 days from the date the bill for services is mailed to
the customer, to pay the listed charges unless otherwise agreed to pursuant to a residential rental
agreement establishing tenancy. Customer payments must be posted promptly. No Video
Provider may terminate residential service for nonpayment of a delinquent account unless the
Video Provider furnishes notice of the delinquency and impending termination at least 15 days
prior to the proposed termination. The notice must be mailed, postage prepaid, to the customer
to whom the service is billed. Notice must not be mailed until the 16th day after the date the bill
for services was mailed to the customer. The notice of delinquency and impending termination
may be part of a billing statement. No Video Provider may assess a late fee any earlier than the
22nd day after the bill for service has been mailed.
(10) Every notice of termination of service pursuant to the preceding subsection 9 must
include all of the following information:
(a) The name and address of the customer whose account is delinquent.
(b) The amount of the delinquency.
(c) The date by which payment is required in order to avoid termination of
service.
(d) The telephone number of a representative of the Video Provider who can
provide additional information and handle complaints or initiate an investigation concerning the
service and charges in question.
(11) Service may only be terminated on days in which the customer can reach a
representative of the Video Provider either in Person or by telephone.
(12) Any service terminated without good cause must be restored without charge for
the service restoration. Good cause includes, but is not limited to, failure to pay, payment by
check for which there are insufficient funds, theft of service, abuse of equipment or system
personnel, or other similar Subscriber actions.
(13) All Video Providers must issue requested refund checks promptly, but no later
than 45 days following the resolution of any dispute, and following the return of the equipment
supplied by the Video Provider, if service is terminated.
(14) All Video Providers must issue security or customer deposit refund checks
promptly, but no later than 45 days following the termination of service, less any deductions
permitted by law.
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(15) Video providers must not disclose the name and address of a Subscriber for
commercial gain to be used in mailing lists or for other commercial purposes not reasonably
related to the conduct of the businesses of the Video Providers or their Affiliates, unless the
Video Providers have provided to the Subscriber a notice, separate or included in any other
customer notice, that clearly and conspicuously describes the Subscriber's ability to prohibit the
disclosure. Video providers must provide an address and telephone number for a local
Subscriber to use without toll charge to prevent disclosure of the Subscriber's name and address.
(D) Penalties for Noncompliance
(1) Purpose
The purpose of this paragraph (D) is to authorize the imposition of monetary penalties for the
violation of the customer service standards established by this Section 59. The imposition of
penalties authorized by this paragraph (D) will not prevent the City or any other affected party
from exercising any other remedy to the extent permitted by law, including but not limited to any
judicial remedy as provided below in subsection (2)(iv).
(2) Administration and Appeals.
(i) The City Manager or the City Manager's designee is authorized to
administer this paragraph (D). Decisions by the City Manager to assess monetary penalties
against the Grantee must be in writing and must contain findings supporting the decisions.
Decisions by the City Manager are final, unless appealed by the Grantee or aggrieved party.
(ii) If the Grantee or any interested person is aggrieved by a decision of the
City Manager, the aggrieved party may, within 10 days of the written decision, appeal that
decision in writing to the City Clerk. The appeal shall be conducted in accordance with the
provisions of Section 49(B)(2).
(iii) Schedule of Penalties. The following schedule of monetary penalties may
be assessed against the Grantee for the material violation of the provisions of the customer
service standards set forth in this section, provided that the violation is within the reasonable
control of the Grantee:
(a) The maximum penalty for a first material violation is two hundred
dollars ($200) for each day of the material violation.
(b) For a second material violation of the same nature within a 12-
month period for which the City has provided notice and a penalty has been assessed, the
maximum penalty is five hundred fifty dollars ($500) for each day of the material violation.
(c) For a third or further material violation of the same nature within a
12 -month period for which the City has provided notice and a penalty has been assessed, the
maximum penalty is seven hundred fifty dollars ($750) for each day of the material violation.
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(iv) Judicial Remedy. This paragraph does not preclude any affected party
from pursuing any judicial remedy available to that party without regard to this paragraph (k).
(v) Notice of Violation. The City must give the Grantee written notice of any
alleged violation of the consumer service standards and allow the Grantee at least 30 days from
receipt of the notice to remedy the specified violation.
(vi) Assessment of Monetary Penalties.
(a) If a violation has not been corrected or cured by Grantee within the
time specified by the City, the monetary penalties specified above in subparagraph (iii) may be
assessed from the date of delivery to Grantee of the City's written notice of violation.
(b) In assessing monetary penalties under this paragraph (k), the City
Manager or the City Council, as applicable, may take into account the nature, circumstances,
extent and gravity of the violation and, with respect to the Grantee, the degree of culpability, any
history of prior violations, and such other matters as may be relevant. If warranted under the
circumstances, the monetary penalty to be assessed may be less than the maximum penalty
amount specified above in subparagraph (iii).
(E) Additional Consumer Protection and Service Standards
(1) In addition to the consumer protection and service standards that are specified
above in paragraphs (a) through (h) of subparagraph (13)(3) of this section, the franchise
agreement with a Grantee may require compliance with the following:
(a) Federal statutes, and the. rules, regulations, and orders of the Federal
Communications Commission, including the following:
(i) The provisions of Section 76.309(c) of Title 47 of the Code of
Federal Regulations, as it now exists or may later be amended.
(ii) The provisions of Section 76.630 of Title 47 of the Code of
Federal Regulations, as it now exists or may later be amended.
(iii) The provisions of Section 551 of Title 47, United States Code, as it
now exists or may later be amended.
(iv) The provisions of California Government Code Sections 53054, et
seq., entitled the "Cable Television and Video Provider Customer Service and Information Act."
(v) The provisions of California Government Code Section 53088, et
seq., entitled the "Video Customer Service Act."
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(vi) The provisions of California Civil Code Section 1722(b)(1) -(6)
relating to service or repair transactions between cable television companies and their
subscribers.
(vii) The provisions of California Penal Code Section 637.5 relating to
subscribers' rights to privacy protection.
(2) The City may, in its discretion, incorporate in a franchise agreement those
customer service and protection standards referenced above in this paragraph (1) that are the most
stringent, and that afford the greatest protection to consumers. These standards will apply, to the
extent authorized by law, to all video, voice, and data services that are provided by the Grantee
to its subscribers within the franchise service area.
SECTION 60. TELECOMMUNICATIONS SERVICE PROVIDED BY TELEPHONE
CORPORATIONS.
Any video programming that is provided by a Telephone Corporation that uses public
rights -of -way in the delivery of the Video Programming, regardless of the technology used, will
be considered a Cable Service under this Ordinance, unless such programming is otherwise
preempted by state or federal law.
(A) In recognition of and in compliance with the statutory authorizations and requirements set
forth above in the Recitals of this Ordinance, the following regulatory provisions are applicable
to a telephone corporation that desires to provide telecommunications service by means of
facilities that are proposed to be constructed within the City's Public Rights -of -Way:
(1) The telephone corporation must apply for and obtain, as may be applicable, an
excavation permit, an encroachment permit, or a building permit ( "Ministerial Permit. ")
(2) In addition to the information required by this Code in connection with an
application for a Ministerial Permit, a telephone corporation must submit to the City the
following supplemental information:
(a) A copy of the certificate of public convenience and necessity issued by the
CPUC to the applicant, and a copy of the CPUC decision that authorizes the applicant to provide
the telecommunications service for which the facilities are proposed to be constructed in the
City's Public Rights -of -Way.
(b) If the applicant has obtained from the CPUC a certificate of public
convenience to operate as a "competitive local carrier," the following additional requirements are
applicable:
(i) As required by Decision No. 95 -12 -057 of the CPUC, the applicant
must establish that it has filed with the City in a timely manner a quarterly report that describes
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the type of construction and the location of each construction project proposed to be undertaken
in the City during the calendar quarter in which the application is filed, which information is
sufficient to enable the City to coordinate multiple projects, as may be necessary.
(ii) If the applicant's proposed construction project will extend beyond
the utility rights -of -way into undisturbed areas or other rights -of -way, the applicant must
establish that it has filed a petition with the CPUC to amend its certificate of public convenience
and necessity and that the proposed construction project has been subjected to a full -scale
environmental analysis by the CPUC, as required by Decision No. 95 -12 -057 of the CPUC.
(iii) The applicant must inform the City whether its proposed
construction project will be subject to any of the mitigation measures specified in the Negative
Declaration [ "Competitive Local Carriers (CLCs) Projects for Local Exchange Communication
Service throughout California "] or to the Mitigation Monitoring Plan adopted in connection with
Decision No. 95 -12 -057 of the CPUC. The City's issuance of a Ministerial Permit will be
conditioned upon the applicant's compliance with all applicable mitigation measures and
monitoring requirements imposed by the CPUC upon telephone corporations that are designated
as "competitive local carriers."
(B) In recognition of the fact that numerous excavations in the Public Rights -of -Way
diminish the useful life of the surface pavement, and for the purpose of mitigating the adverse
impacts of numerous excavations on the quality and longevity of public street maintenance
within the City, the following policies and procedures are adopted:
(1) The City Manager is directed to ensure that all public utilities, including
telephone corporations, comply with all local design, construction, maintenance and safety
standards that are contained within, or are related to, a Ministerial Permit that authorizes the
construction of facilities within the Public Rights -of -Way.
(2) The City Manager is directed to coordinate the construction and installation of
facilities by public utilities, including telephone corporations, in order to minimize the number of
excavations in the Public Rights -of -Way. In this regard, based upon projected plans for street
construction or renovation projects, the City Manager is authorized to establish on a quarterly
basis one or more construction time periods or "windows" for the installation of facilities within
the Public Rights -of -Way. Telephone corporations and other public utilities that submit
applications for Ministerial Permits to construct facilities after a predetermined date may be
required to delay such construction until the next quarterly "window" that is established by the
City.
SECTION 61. The City Council hereby declares that the provisions of this Ordinance are
severable and if for any reason a court of competent jurisdiction shall hold any sentence,
paragraph or section of this Ordinance to be invalid, such decision shall not affect the validity of
the remaining parts of this Ordinance.
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SECTION 62. The City Clerk shall certify to the adoption of this Ordinance and shall cause a
copy of same to be published in the official newspaper of said City within fifteen (15) days after
its adoption. This Ordinance shall take effect on the thirty-first (31 ") day after its adoption.
PASSED, APPROVED AND ADOPTED this 19th day of July, 2005.
Mayor of the City of Arcadia
ATTEST:
City Clerk of the City of Arcadia
APPROVED AS TO FORM:
City Attorney
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EXHIBIT B
OWNERSHIP STRUCTURE
Champion Broadband, LLC Corporate Structure
November 1, 2005
Champion Broadband, LLC
Colorado Limited Liability Company
Champion Cable, LLC
Champion Holdings, LLC Colorado Limited Liability
Wyoming Limited Liability Company Company
Champion Broadband California, LLC W ideOpenW est Colorado, Inc.
Wyoming Limited Liability Company Delaware Corporation
Champion Broadband Colorado, LLC
Delaware Limited Liability Company
Description of Ownership Structure
Champion Broadband California, LLC (CBCA) was formed in March 2004 for the purpose of
acquiring and operating the assets of Altrio Communications. CBCA is owned 100% by
Champion Holdings, LLC (CH), and CH is owned 100% by Champion Broadband, LLC (CB)
CH also owns 100% of the stock of WideOpenWest Colorado, Inc., which holds 100% of the
membership interest in Champion Broadband Colorado, LLC (CBCO) a competitive broadband
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cable system serving parts of Denver and Lakewood, Colorado, a company acquired in May
2003. CB is headquartered in Castle Rock, Colorado and is owned by Mark Haverkate
(46.25°/x), David Haverkate (46.25 %), and Jeffrey Decker (7.5 %). Additionally, CB wholly
owns another subsidiary, Champion Cable, LLC, which currently owns and operates 19 cable
television systems in Colorado and Wyoming.
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EXHIBIT C
GRANTEE'S TECHNOLOGY IMPLEMENTATION PLAN
I. DESCRIPTION OF GRANTEE'S OPEN VIDEO SYSTEM
Champion Broadband California, LLC ( "Champion ") will be operating an advanced hybrid
fiber -coax (HFC) telecommunications infrastructure to deliver services to Arcadia residents.
This network will be capable of expansion to a fiber -to- the -home design as the network and the
market evolve. The network is primarily optical, meaning that signals from Champion's central
processing facility to individual customers are carried over optical fibers, with the exception of
the final mile or so, where they are carried over coaxial cables. Ultimately, all information
carried by the network will be transmitted solely over optical fiber:
Information to and from regions within Champion's designated service area are passed through
strategically - located "hubs." From hubs, the signals are transported to "nodes" within each
neighborhood, where the information is converted for transport through short coaxial cables to
customers.
Each node, the coaxial equipment between the node and customers' premises, and the network
termination equipment at homes will all be powered by a "hardened" backup power system
located near the node.
All of these levels of redundancy are supported by a network status monitoring system that
continuously monitors the status of hubs, nodes, power supplies and Champion - furnished
terminal equipment, so that any operating discrepancies can be promptly addressed by field
personnel.
Attachment 1 to this Exhibit C generally describes Champion's video services that will be
available on the effective date of this Agreement. The parties acknowledge that Champion will
also be providing unregulated types of telecommunications services (such as local telephone and
high -speed Internet access) that may also be offered to Arcadia residents.
II. PHASED CONSTRUCTION OF EXTENSIONS TO THE OPEN VIDEO SYSTEM
A. Prior to Grantee's commencement of any future extension of its open video
system, Grantee must submit to Grantor construction plans for that phase of the work that is to be
undertaken, as required by Grantor's standard permitting plans and procedures. These
construction plans must provide a sufficient level of detail to warrant the issuance of permits
including, without limitation, the location, plan profile, and specifications of equipment,
facilities, and improvements that are proposed to be constructed or installed. The construction
plans for each full or partial phase of the work must be prepared under the direction of and
signed by, a licensed professional engineer registered in the State of California, as required by
law. The construction plans must be in compliance with Grantor's current standards and
specifications and must include a traffic control plan.
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B. The parties will periodically meet and confer to review Grantee's milestones for
any future extension of its open video system.
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EXHIBIT C
ATTACHMENT
Champion Broadband California, LLC will offer a wide range of video services to its customers
over the open video system. These services will include:
No converter box required:
1) Analog Basic Video:
Requires only a connection of the coaxial cable to a cable -ready television set.
Approximately 80 video channels, including retransmission of over - the -air broadcast
stations, local public, educational and governmental access channels, and a wide range of
satellite- delivered programming services broken out by genre for ease of viewing.
Requires a converter box (supplied by Champion Broadband California. LLC):
2) Digital Video Services:
Approximately 50 channels of satellite- delivered programming services that include
channels with extensive foreign language programming.
3) Premium Channels:
Opportunity to subscribe to multiplexed and individual programming channels such as
HBO, Cinemax, Showtime, and Starz!, as well as premium foreign language tiers.
4) Pay- Per -View:
Opportunity to buy special event or prescheduled programs on a per -event basis.
5) Video -On- Demand:
Opportunity to electronically rent approximately 500 hours of motion pictures and other
special programs on a 24 -hour basis with unlimited viewing during the purchase period; includes
capability on converter box to rewind, pause, and slow scan (similar to a personal video
recorder).
6) Digital Audio Services:
Opportunity to subscribe to approximately 45 channels of compact -disc quality, non-
commercial, audio channels with a connection to a television's stereo speakers, an audio system
tuner, or home - theater system.
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EXHIBIT D
OPEN VIDEO SYSTEM SERVICES FOR PUBLIC
EDUCATIONAL, AND COMMUNITY FACILITIES
Location
Address
1. City Hall
240 W. Huntington Drive
2. Police Department Headquarters
250 W. Huntington Drive
3. Fire Department Headquarters
710 N. Santa Anita Avenue
4. Maintenance Service Center
11800 Goldring Road
5. Public Library
20 W. Duarte Road
6. Arcadia Unified School District
234 Campus Drive
7. Arcadia Hieh School Studio
234 Campus Drive
8. Dana Middle School
9. First Avenue Middle School
10 Dana Middle School
11. Camino Grove Elementary
12. Baldwin Stocker Elementary
13. Highland Oaks Elementary
14. Holly Avenue Elementary
15. Hugo Reid Elementary
16. Longley Way Elementary
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EXHIBIT E
CONSUMER PROTECTION AND SERVICE STANDARDS
Grantee's Notifications to Subscribers.
Upon activation of the open video system, or any portion of that system, Grantee will
provide to all new subscribers, and annually to existing subscribers, all notifications that are
required by federal law or regulations.
General Standards for Consumer Service and Protection.
Grantee must meet or exceed all applicable consumer service standards that are
customary in the cable television industry and that are recommended or required by the
following:
(a) Local, state and federal statutes, and the rules, regulations, and orders of
the Federal Communications Commission, including the following:
(i) The provisions of Section 76.309(c) of Title 47 of the Code of Federal
Regulations, as it now exists or may later be amended, a copy of which is attached
as Schedule 1 to this Exhibit E; provided, however, that strict compliance with
these provisions will not be required during such time as any new phase of the
open video system is under construction.
(ii) The provisions of Section 76.630 of Title 47 of the Code of Federal
Regulations, as it now exists or may later be amended, a copy of which is attached
as Schedule 2 to this Exhibit E.
(iii) The provisions of Section 551 of Title 47, United States Code, as it now
exists or may later be amended, a copy of which is attached as Schedule 3 to this
Exhibit E.
(b) The provisions of California Government Code Sections 53054, et seq.,
titled the "Cable Television and Video Provider Customer Service and Information Act," a copy
of which is attached as Schedule 4 to this Exhibit E.
(c) The provisions of California Government Code Section 53088, et seq.,
titled the "Video Customer Service Act," a copy of which is attached as Schedule 5 to this
Exhibit E.
(d) The provisions of California Civil Code Section 1722(b)(1) -(6) relating to
service or repair transactions between cable television companies and their subscribers, a copy of
which is attached as Schedule 6 to this Exhibit E.
(e) The provisions of the OVS Ordinance.
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Unless preempted by federal law, the consumer service standards referenced above that are the
most stringent, and that afford the greatest degree of protection to consumers, will apply to
Grantee's operations and activities in the designated service area.
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EXHIBIT F
SUPPORT OF LOCAL CABLE USAGE
L PEG ACCESS CHANNELS
A. Channel Capacity and Use
1. Grantee will make available to Grantor, at no cost to Grantor, six channels
for the exclusive use of Grantor, or its designee, for noncommercial PEG access programming.
These six channels include the three analog channels that are currently activated on the
franchised cable operator's television system [Channel 6 — Arcadia Community TV; Channel 16
— Arcadia School District; Channel 35 — KLRN], and three reserved channels. Each analog
channel will be six MHz and will be capable of transmitting a standard analog video signal.
Use of the PEG access channels will be under the exclusive control of
Grantor, or its designee, and subject to such rules and regulations as Grantor may establish. In
this regard, Grantor reserves the right to delegate the operation and management of any current
or future PEG access channel to such individuals or entities as it may select, all of whom must
comply with federal, state, and local laws and regulations relating to the operations of that
channel.
3. All PEG access channels will be positioned on the basic service tier and
will be fully accessible to subscribers, consistent with FCC regulations.
4. If requested by Grantor, Grantee will identify the PEG access channels, as
well as the PEG programming carried on the PEG access channels. PEG access channel
programming information will be set forth in Grantee's printed and electronic programming
guides in the same manner in which Grantee identifies the channels, programming, and audio
services under its control. It is the responsibility of Grantor to provide program schedules in a
timely manner, and, if Grantor fails to do so for a specific PEG access channel, Grantee may
identify the general type of programming carried on that PEG access channel.
5. Upon the effective date of this Agreement, all PEG access channels will
be positioned at the same channel locations as provided by the prior open video system operator.
6. Grantor's PEG access channels will retain their numerical designations in
the Grantee's channel lineup unless Grantee is obligated to change them due to a must -carry
requirement or request for retransmission consent under FCC regulations or similar legal
mandate. If the numerical designation of a PEG access channel is proposed to be changed for
any reason, Grantee must give Grantor at least 120 days prior written notice, or such prior
written notice as is reasonably practical. For each change of PEG access channel designation,
Grantee shall provide to Grantor a grant in the sum of $5,000 to cover costs of notices to
subscribers, modifications to descriptive literature, promotion of the access channel under its
new designation, and other expenses related to rebranding.
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7. Grantee will ensure that the signal quality for all PEG access channel
cablecasting is in compliance with all applicable FCC technical standards. Grantee will use
equipment and procedures in order to minimize the degradation of signals carried on a PEG
access channel that do not originate with Grantee.
8. Except to the extent authorized by federal law, Grantee will not exercise
any editorial control over the public, educational, or governmental use of channel capacity that is
made available to Grantor under the provisions of this Exhibit.
9. Grantee must maintain connectivity to each PEG access programmer at its
place of origination identified below. This interconnection may be accomplished by direct cable
connection, microwave link, satellite, or other appropriate method. Grantee will bear all costs of
such interconnection and related maintenance.
a. City Hall, 240 W. Huntington Drive
b. School District Headquarters, 234 Campus Drive
10. Grantee is responsible for the maintenance of the "reverse feed"
distribution plant that is used for the transmission of PEG access programming. All costs
associated with the maintenance of Grantee's distribution network and hardware, and network
management, will be Grantee's responsibility.
B. Restrictions.
1. Grantor agrees not to use its designated public, educational, or
governmental access channels to provide commercial or revenue - generating services that may
compete, directly or indirectly, with services provided by Grantee; provided, however, that
Grantor may cablecast acknowledgments of funding sources and the underwriting of
programming costs, which will include the acknowledgment of Grantee's subsidies.
2. Grantee must relinquish its use of any or all of Grantor's three reserved
channels within 120 days after receipt of written notice from Grantor that the access channel
capacity will be used for additional public, educational, or governmental programming.
C. Digital PEG Access Channels.
1. The parties acknowledge that Grantee may in the future use video
compression technology in order to transmit PEG access video programming in a digital format
to subscribers. During any period in which Grantee provides both analog and digital
programming, consistent with federal law, Grantee must carry the PEG access channels on both
its analog and digital programming tiers: This provision, however, shall not require Grantee to
carry duplicate digital and analog PEG access channels solely on the basis that Grantee is
offering digital channels.
2. When Grantee has converted all video programming, both commercial and
non - commercial, from analog to digital, then the parties will meet and confer concerning
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additional bandwidth that may be allocated for PEG access use, taking into consideration the
prior use of PEG access channel capacity, both analog and digital, and the extent of any excess
demand that may then exist.
D. Live Cablecastina Capabilities.
Grantee will absorb the capital costs for, and install, two -way interactive
connections and related equipment that will facilitate the cablecasting of PEG access
programming from the local sites identified below as origination points; provided, however, that
if Grantor desires to substitute a different location for one or more sites referenced below, the
parties will meet and confer concerning such proposed substitution.
(a) City Hall, 240 W. Huntington Drive
(b) Police Department Headquarters, 250 W. Huntington Drive
(c) Fire Department Headquarters, 710 N. Santa Anita Avenue
(d) Maintenance Service Center, 11800 Goldring Road
(e) Public Library, 20 W. Duarte Road
If either City Hall or Arcadia Unified School District Headquarters is relocated
during the term of this Agreement, Grantee will establish live cablecast replacement connections
at the new site.
E. Grants and Other import for PEG Access and Community Connectivity.
Grantor has determined that the public interest will best be served by imposing
comparable financial obligations upon similarly- situated multichannel video programming
providers that are franchised to provide services within the City. Consistent with Grantor's
established policy of requiring franchisees to meet a variety of community needs by providing
cash grants, capital contributions, facilities, and in -kind contributions of technology applications
and services, the parties agree that Grantee is obligated under this Agreement to provide the
following categories of support for the PEG access and community connectivity needs of
Grantor:
1. PEG Access Payments. Grantee will pay to Grantor, for use by Grantor in
support of PEG access activities, an amount equal to $.55 (55 cents) per month per Subscriber
( "PEG Access Payments ") based on actual collections with a total payment not to exceed
$319,312 during the life of the Franchise. PEG Access Payments will be made to Grantor no
later than January 31, commencing with the first calendar year following the effective date of
this Agreement, and continuing annually thereafter. Grantee has the right to separately itemize
on subscriber billings its collection of PEG Access Payments, consistent with federal law, and
Grantee will provide advance written notice to Grantor prior to any such itemization.
2 Total of PEG Access Payments. If full payment in the sum of $319,312
has not been made by Grantee as of the tenth anniversary year of this Agreement, and there is no
extension or renewal of this Agreement, then Grantee will be obligated to pay in full the
difference between $319,312 and the amount that has then been remitted to Grantor. If the
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franchise term is extended or this Agreement is renewed, then Grantee will continue paying
Grantor $0.55 per subscriber per month in support of Grantor's PEG access system needs until
such time as the cumulative amount paid to the Grantor equals $319,312 or an amount agreeable
by the parties at such time of the extension or renewal.
3. Construction of Facilities. During the term of this Agreement, Grantee
will, in the course of constructing any extensions of its open video system, concurrently
construct for Grantor such facilities as may be agreed upon by the parties. The cost of these
facilities will be paid by Grantor to Grantee on a time and materials basis. The parties will
periodically meet and confer to discuss the details of such facilities construction and the time
table for implementation.
Access Interconnections.
Grantee acknowledges that it is Grantor's goal to further the community's cable -
related needs and interests by providing for interconnection of PEG channels between Grantor
and surrounding communities as may be developed among participating entities in the region.
Therefore, Grantee agrees to continue to participate in any PEG channel interconnection that
may be in place as of the effective date, or that may be developed, in order to facilitate the
sharing of PEG programming between and among participating entities. In addition, Grantor
shall have the right to use any PEG channel for PEG programming provided to it through the
interconnect.
II. FUTURE ACCESS CHANNEL NEEDS.
Either party to this Agreement may request that the other party meet and confer to discuss
actual or potential changes in PEG access channel requirements, whether attributable to
technological developments, changes in viewership statistics, or other factors. Any
modifications to this Exhibit that are agreed upon by the parties will be memorialized in writing.
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EXHIBIT G
11
GRANTOR'S UNDERGROUND CONSTRUCTION REQUIREMENTS
INSTALLATIONS IN PARKWAYS
A. All conduit installations in parkways must have a minimum cover of 18 inches
below the finish grade.
B. All existing improvements in parkways, including landscaping and sprinklers,
must be protected from damage, or, if damaged, restored to pre - construction conditions. All
repairs and replacements must be made in -kind.
C. All service boxes and vaults must be set to finish grade on six inches of one -inch
crushed rock.
D. No access to service boxes or vaults may be located within the sidewalk,
wheelchair ramps, or drive apron areas unless authorized by the City Engineer.
II. INSTALLATIONS IN ROADWAYS
A. Conduit may be installed at locations shown on plans submitted by Grantee after
approval by the City Engineer. If a location is available, the preferred alignment is two feet from
the outer edge of an existing gutter. Where it cannot be located on the preferred alignment, the
location must be approved by the City Engineer. Removal and replacement of all damaged
pavement between the trench and the edge of existing roadway pavement is required on all
streets. The edge of the trench must be a minimum of one foot from the edge of the gutter.
Exceptions to this requirement must be approved by the City Engineer.
B. Concrete pavement serving as bus pads, spandrels, cross gutters, or local
depressions may not be cut. At these locations, the conduit must be bored or jacked.
C. It is mandatory to maintain a straight alignment. Routing of conduit at bus pads,
and any other protrusions beyond the gutter edge, must be approved by the City Engineer. Some
installations may require locations in the parkway. Locations directly above or in conflict with
existing utilities are not permitted, unless approved by an agreement with the affected utility.
D. Open -cut transverse trenches are not allowed within streets, except at
intersections, unless otherwise provided. To serve customers on the other side of a street, a
parallel line on the opposite side of the street must be installed. An alternative to this procedure
is mid -block crossings installed by jacking or boring conduit under the street. If the conduit is to
be jacked under the street, Grantee must abide by the following guidelines unless otherwise
directed by the City Engineer:
Crossings must be at least 150 feet apart.
Jacking pits must be in the parkway adjacent to the main cable trench.
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Written approval must be obtained from the City prior to any jacking or
boring operations.
E. Conduit must be installed at a consistent depth throughout a block with a
minimum cover (below the established edge of the gutter) of 30 inches in all streets and alleys.
III. ABOVE- GROUND SERVICE BOXES OR VAULTS
A. Above- ground service boxes or vaults are not permitted in the public rights -of-
way without prior consideration of the need, which consideration will include industry technical
standards, the safety and aesthetics of the placement, and the cost of below - ground alternatives.
Grantee will flush mount all facilities where current technology enables Grantee to do so. When
it is not possible to underground a facility entirely, Grantee will evaluate options for placing as
much of the facility below ground as possible.
B. Above - ground service boxes or vaults may not be installed without the prior
approval of the Public Works Department and the Community Services Department, which
approval shall not be unreasonably withheld. Landscaping and irrigation requirements may be
imposed by the Public Works Department or the Community Services Department. Grantee will
coordinate the siting and choice of pedestal materials with Public Works Department and the
Community Services Department and with residents adjacent to proposed above - ground service
boxes and other facilities.
C. Above - ground facilities shall be constructed so as to connect and lock to some
form of concrete footing.
D. Grantee will minimize the negative impacts of above - ground facilities on
aesthetics, public convenience, and public safety to the extent reasonably feasible, through such
means as camouflage, creative siting and landscaping, placement of facilities on private property,
and partial undergrounding.
E. Above - ground service boxes or vaults must be properly maintained for safety,
public convenience, and aesthetic reasons in accordance with the following procedures:
1. Safety repairs, including graffiti removal, must be completed within
24 hours after discovery of the need for such repairs by Grantee's personnel or notification from
the City Engineer or other designated representative of Grantor.
2. Grantee must provide routine maintenance (e.g., painting, leveling, service
box replacement, fastening to base) within 10 working days after the discovery of the need for
such maintenance by Grantee's personnel or notification from a resident, the City Engineer, or
other designated representative of Grantor.
3. Grantee must replace above - ground service boxes or vaults if routine or
emergency maintenance is not sufficient to return the facility to a safe and aesthetically
acceptable condition as determined by the City Engineer.
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4. Grantee must patrol all areas of the designated service area having above-
ground service boxes or vaults on a regular basis, at intervals not in excess of three months, to
inspect for damage and to determine the need for any required maintenance.
F. Based on advances in technology related to pedestal housings, Grantor and
Grantee will meet periodically to discuss potential locations where above - ground service boxes
or vaults can be eliminated, or converted to flush - mounted enclosures, without compromising the
technical operation, reliability, and economic viability of the open video system. Subject to
these considerations, as new facility housing technology becomes available, Grantee will place
existing or proposed above - ground facilities below ground, as may be required of all other
similarly- situated occupants of Grantor's rights -of -way.
IV. PERMITS
A. All work within the public rights -of -way must be conducted under a permit from
the Public Works Department. Grantee must comply with all City excavation policies and
procedures.
B. An excavation permit must be obtained for each increment of work, and
inspection must be requested at least 24 hours prior to any excavation. All inspection costs will
be charged directly to Grantee.
C. Detailed plans for all work must be submitted to and approved by the Public
Works Department prior to issuance of any permits. Complete detailed plans shall clearly
indicate the horizontal alignment of the facilities. Plans must clearly show streets, property lines,
curbs, centerlines, and existing utilities.
D. Above - ground power pedestals must be clearly delineated on the plans at the time
they are submitted for review. Review and permitting for power pedestals will be conducted by
the Public Works Department. All power pedestals and related connections must comply with
the Arcadia Municipal Code and all other applicable laws and regulations.
V. PRE- CONSTRUCTION
A. A pre -job meeting must be scheduled prior to start of work at each permitted
location as determined by the City Inspector. Representatives of Grantee, including its
contractors, and of the Public Works Department and the Community Services Department, must
be included in these pre -job meetings. Grantee must call for inspection at least 24 hours before
starting any work.
B. Telephonic notices must be provided to the Underground Service Alert (USA) at
least two working days prior to starting work on any permitted project. Grantee must have an
approved permit from the Public Works Department before contacting USA.
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C. All utility services must be marked prior to excavation using chalk -based paint
[ "AERVOE" brand available from Surveyor's Services at (714) 546- 0606)] with a visibility life
not to exceed three weeks.
D. Affected residents must be notified by Grantee in writing not less than 96 hours
prior to excavation on their streets. This written notification must be approved in advance by the
City Inspector.
VI. CONSTRUCTION
A. Compliance is required at all times with all provisions of the latest edition of the
Work Area Traffic Control Handbook (WATCH), all applicable portions of the Arcadia
Municipal Code, and the latest edition of the "Standard Specification for Public Works
Construction - Green Book," including any supplements.
B. Unless otherwise approved in advance by the City Engineer, no excavations may
be made by Grantee anywhere in the City between November 15 and January 3 of each year
within public rights -of -way.
C. Open- trench protection, and noise and dust curtailment methods, acceptable to the
City Inspector, must be provided.
D. Pavement cuts and restoration must conform to City of Arcadia Standard Plan 5-
225 for asphalt and concrete pavement restoration.
E. All trenching activity that is commenced each day in the street must be backfilled
to a depth specified by the City Inspector at the end of the day; final resurfacing must be
completed within five working days on all streets and alleys. Final roadway clean -up must be
completed within five days following resurfacing. Final clean -up of vault installations and other
work behind the curb must be completed within 10 days following roadway resurfacing.
F. Grantee, or its contractor, must designate a project superintendent to handle field
operations.
G. If utility services must be exposed, the trench must be hand - excavated to the
service line after saw - cutting pavement.
H. Residents must be notified immediately of any damage affecting their property,
and repairs must be promptly made. Same -day repair of damaged utility services is mandatory.
VII. MISCELLANEOUS
A. Where field conditions are such that these Underground Construction
Requirements are conflicting or apparently prevent progress, all work will cease until modified
specifications are approved in writing by the City Engineer.
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B. Grantee will participate in all meetings convened by Grantor for the purpose of
identifying, scheduling, and coordinating excavation work in the public rights -of -way.
C. The security deposit referenced in Subsection 2.5(a) of the Agreement will be
available during the entire period of any future construction to secure Grantee's obligation to
correct any defective work in the public rights -of -way that is discovered.
D. If there is any conflict or inconsistency between the provisions of this Exhibit G
and the provisions of the Agreement to which this Exhibit G is attached, then the provisions of
this Exhibit G will have precedence and will control.
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C,
EXHIBIT H
C,
MAP OF DESIGNATED SERVICE AREA AND OF
EXISTING OPEN VIDEO SYSTEM FACILITIES
[to be attached]
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TABLE OF CONTENTS
Page
1. PARTIES; NOTICES; RIGHTS AND AUTHORITY GRANTED ..................
..............................2
1.1.
Parties to the Agreement ..........................................................
..............................2
1.2.
Representatives of the Parties and Service of Notices .............
..............................3
1.3.
Definitions ...............................................................................
..............................3
1.4.
Conflicts ...................................................................................
..............................3
1.5.
Grant ........................................................................................
..............................3
1.6.
Effective Date ..........................................................................
..............................4
1.7.
Duration ...................................................................................
..............................4
1.8.
Agreement Not Exclusive ........................................................
..............................4
1.9.
Scope of the Agreement ...........................................................
..............................4
1.10.
Applicability of Government Code Section 53066 ..................
..............................5
2. GENERAL REQUIREMENTS ......................................................................... ..............................5
2.1. Governing Requirements ......................................................... ..............................5
2.2. Fee on Gross Annual Revenue ................................................ ..............................6
2.3. Payment to Grantor .................................................................. ..............................8
2.4. Insurance Requirements ........................................................... ..............................8
2.5. Security for Grantee's Performance ........................................ ..............................9
2.6. Affirmative Action; Fair Employment Practices ................... ..............................1 l
3. RIGHTS RESERVED TO THE GRANTOR ................................................... .............................11
3.1.
Reservation ............................................................................. .............................11
3.2.
Delegation of Powers .............................................................. .............................11
3.3.
Right to Inspect Construction ................................................. .............................11
3.4.
Right to Require Removal of Property .................................. ..............................1
l
3.5.
Right of Intervention .............................................................. ..............................1
l
3.6.
Option to Acquire the Open Video System and Infrastructure ............................12
4. SYSTEM CONSTRUCTION AND SPECIAL SERVICES ............................ .............................13
4.1.
System Construction ......................:........................................ .............................13
4.2.
Notices Relating to System Construction ............................... .............................13
4.3.
Services for Public, Educational and Community Facilities .. .............................13
4.4.
Emergency Alert Capability ................................................... .............................14
4.5.
Parental Control Devices ........................................................ .............................14
4.6.
Technical Standards ................................................................ .............................14
4.7.
No Offset Against Fees ........................................................... .............................15
5. SERVICES, PROGRAMMING, AND CONSUMER PROTECTION STANDARDS ...............
16
5.1.
Rates and Charges for Services and Equipment ..................... .............................16
5.2.
Discounts for Low- Income Persons ........................................ .............................16
5.3.
Consumer Protection and Service Standards .......................... .............................16
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1. BREACH OF FRANCHISE; GROUNDS FOR ASSESSMENT OF PENALTIES
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5.4.
Broad Categories of Cable Services ....................................... .............................16
5.5.
Subscriber Surveys ................................................................. .............................16
6.
SUPPORT OF LOCAL CABLE USAGE AND TECHNOLOGICAL INFRASTRUCTURE
....17
7.
DESIGN AND CONSTRUCTION .................................................................. .............................17
7.1.
System Construction and Extension ....................................... .............................17
7.2.
Construction Components and Techniques ............................ .............................18
7.3.
Technical and Performance Standards .................................... .............................18
7.4.
Construction Codes ................................................................. .............................19
7.5.
Construction Default ............................................................... .............................19
7.6.
Vacation or Abandonment ...................................................... .............................19
7.7.
Abandonment in Pl ace ............................................................ .............................19
7.8.
Removal of System Facilities ................................................. .............................19
7.9.
Movement of Facilities ........................................................... .............................20
7.10.
Undergrounding of Cable ....................................................... .............................20
7.11.
Facility Agreements ................................................................ .............................20
7.12.
Repair of Streets and Public Ways ......................................... .............................20
7.13.
Erection of Poles Prohibited ................................................... .............................20
7.14.
Reservation of Street Rights ................................................... .............................20
7.15.
Miscellaneous Design and Construction Requirements ......... .............................21
8.
COMPLIANCE AUDITS AND TECHNICAL DATA ................................... .............................22
8.1.
Compliance and Performance Audits ..................................... .............................22
8.2.
System Testing and Technical Data ....................................... .............................25
8.3.
Emergency Repair Capability ................................................. .............................25
9.
RECORDS; REPORTS;
RIGHT TO INSPECT AND AUDIT; EXPERTS .... .............................25
9.1.
Grantee to Provide Records .................................................... .............................25
9.2.
Records ................................................................................... .............................25
9.3.
Maintenance and Inspection of Records ................................. .............................26
9.4.
Reports of Financial and Operating Activity .....................:.... .............................26
9.5.
Performance Tests and Compliance Reports .......................... .............................27
9.6.
Additional Reports....... ........................................................................................
27
9.7.
Communications with Regulatory Agencies .......................... .............................27
9.8.
Inspection of Facilities ............................................................ .............................27
9.9.
Right to Audit ......................................................................... .............................27
9.10.
Retention of Experts ............................................................... .............................28
10.
PROTECTION OF GRANTEE'S PROPRIETARY INFORMATION ........... .............................28
10.1.
"Proprietary Information" Defined ......................................... .............................28
10.2.
Identification of Proprietary Information ............................... .............................28
10.3.
Notice to Grantee .................................................................... .............................28
10.4.
California Public Records Act ................................................ .............................29
1. BREACH OF FRANCHISE; GROUNDS FOR ASSESSMENT OF PENALTIES
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AND FRANCHISE REVOCATION ................................................................ .............................29
11.1.
Termination or Revocation for Breach ................................... .............................29
11.2.
Procedure for Adjudication of Breaches of Agreement .......... .............................30
11.3.
Hearing Officer Procedures .................................................... .............................30
11.4.
City Council Hearing Procedures ........................................... .............................31
11.5.
Penalties for Breach of Agreement ......................................... .............................31
11.6.
Alternative Remedies ............................................................. .............................32
12.
CONTINUITY
OF OPEN VIDEO SYSTEM SERVICES .............................. .............................32
12.1.
Continuity of Service .............................................................. .............................32
12.2.
Operation and Management by Grantor ................................. .............................32
13.
MISCELLANEOUS PROVISIONS ................................................................. .............................33
13.1.
Assignment, Transfer, Sale, and Change of Control .............. .............................33
13.2.
Force Majeure ......................................................................... .............................34
13.3.
Possessory Interest .................................................................. .............................35
13.4.
Indemnification ....................................................................... .............................35
13.5.
Receivership and Forecl osure ................................................. .............................35
13.6.
Conflict of Interest .................................................................. .............................36
13.7.
Resolution of Disputes ............................................................ .............................36
13.8.
Waiver by Grantor .................................................................. .............................36
13.9.
Severabil ity ............................................................................. .............................36
13.10.
Amendments ........................................................................... .............................36
13.11.
Binding Upon Successors ....................................................... .............................37
13.12.
Counterpart Execution ............................................................ .............................37
13.13.
Applicable Law ....................................................................... .............................37
14.
DEFINITIONS
................................................................................................. .............................37
14.1.
Defined Terms ........................................................................ .............................37
14.2.
Terms Not Defined ................................................................. .............................42
15.
CONSIDERATION
FOR GRANTOR'S FORBEARANCE ........................... .............................42
15.1.
OVS Franchise Violations ...................................................... .............................42
15.2.
Consideration for Grantor's Forbearance ............................... .............................42
15.3.
Satisfaction of Grantee's Payment Obligation ....................... .............................43
16.
AUTHORITY AND EFFECTIVE DATE ........................................................ .............................43
16.1.
Authority ................................................................................. .............................43
16.2.
Effective Date ......................................................................... .............................43
EXHIBIT A
ORDINANCE NO. 2206 AS ADOPTED AND IN EFFECT ON
THE EFFECTIVE DATE OF THE AGREEMENT ......... ...............................
A -1
EXHIBIT B
OWNERSHIP STRUCTURE ................................................ ............................B
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EXHIBIT C
GRANTEE'S TECHNOLOGY IMPLEMENTATION PLAN .........................0
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EXHIBIT D
OPEN VIDEO SYSTEM SERVICES FOR PUBLIC,
EDUCATIONAL, AND COMMUNITY FACILITIES .... ...............................
D -1
EXHIBIT E
CONSUMER PROTECTION AND SERVICE STANDARDS .......................E
-1
EXHIBIT F
SUPPORT OF LOCAL CABLE USAGE .......................... ...............................
F -1
EXHIBIT G
GRANTOR'S UNDERGROUND CONSTRUCTION
REQUIREMENTS............................................................ ...............................
G -1
EXHIBIT H
MAP OF DESIGNATED SERVICE AREA AND OF
EXISTING OPEN VIDEO SYSTEM FACILITIES ......... ...............................
H -1
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City of Arcadia
0 i
CADIA AND
IA, LLC GRANTIN
AN AGREEMENT BETWEEN THE CITY OF
CHAMPION BROADBAND O CONRN� THE CITY OF
NONEXCLUSIVE N VIDEO SY3T MSS AND TO
OPERATE AN
ARCADIA AND SETTING FORTH T
CONDITIONS RELATING TO THE EXERCISE OF THOSE
RIGHTS.
City of Arcadia
RVPUB',JSB0O2117 4
RESOLUTION NO. 6499
A RESOLUTION OF THE CITY COUNCIL OF THE
CITY I OF ARCADIA, CALIFORNIA,
CONDITIONALLY APPROVING AN OPEN VIDEO
SYSTEM (OVS) AGREEMENT WITH CHAMPION
BROADBAND, LLC, A WYOMING LIMITED
LIABILITY COMPANY
RECITALS:
A. On May 5, 2005, the City of Arcadia ( "City") received from
Champion Broadband, LLC, a Wyoming limited liability company ( "Champion ")
an application (the "Application ") for the approval of an open video system (OVS)
agreement, in order to officially take over the existing cable franchise agreement
entered into between the City of Arcadia and Altrio Communications, Inc.; and
B. In accordance with Section 54 of City of Arcadia Ordinance No. 2206
(the "Telecommunications Ordinance "), the City has the right to require any entity
that wishes to operate an open video system utilizing the City's rights of way to
enter into an OVS agreement; and
C. Pursuant to Section 1303 of the City of Arcadia Charter, the City
Council of the City of Arcadia has, on November 15, 2005, declared its intention to
conduct a public hearing, following which the City Council has considered the
0
proposed OVS agreement with Champion, at which time all persons wishing to be
heard were afforded an adequate opportunity to be heard; and
D. The City Council has thoroughly considered the terms of the proposed
OVS agreement and hereby finds and declares as follows:
1. There will be significant positive impact on the community
being served.
2. There will not be any unreasonable adverse economic or
aesthetic impact upon public or private property within the area.
3. There will not be any unreasonable disruption or inconvenience
to existing users, or any adverse effect on future use, of utility
poles, public easements, and the public rights -of -way contrary
to the intent of Section 767.5 of the Public Utilities Code.
4. The Applicant has the technical and financial ability to perform.
5. There will not be any impact on the City's interest in having
universal cable service.
6. Other societal interests generally considered by franchising
authorities will be met.
7. The operation of the OVS, in addition to the existing cable
television system in the community, is economically feasible.
2
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E. The City has reviewed the documentation that accompanied the
Application and, based upon the representations set forth in that documentation,
has concluded that Champion has the requisite technical and financial
qualifications to adequately perform, or to ensure the performance of, all
obligations under the proposed OVS Agreement.
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF
ARCADIA, CALIFORNIA, DOES HEREBY FIND, DETERMINE AND
RESOLVE AS FOLLOWS:
SECTION 1. In accordance with Section 54 of the
Telecommunications Ordinance, the City hereby approves that certain Open Video
System Agreement between the City of Arcadia, a municipal corporation of the
State of California, and Champion Broadband California, LLC, a Wyoming limited
liability company, which agreement is attached hereto and incorporated by
reference herein.
SECTION 2. The adoption of this Resolution is not a "project' for
purposes of the California Environmental Quality Act (Public Resources Code, §§
21000 et seq.), pursuant to Section 15378(b)(2) of Title 2 of the California Code of
Regulations, as this Resolution pertains to continuing administrative or
maintenance activities, such as general policy and procedure making and because it
3
0
G
can be seen with certainty that there is no likelihood that this Resolution would
have any effect on the environment. City staff are authorized and directed to
prepare, execute, and file a Notice of Exemption pursuant to the above findings.
SECTION 3. The City Clerk shall certify to the adoption of this
Resolution.
Passed, approved and adopted this 6th day of December 2005.
ATTEST:
City Clerk
APPROVED AS TO FORM:
Stephen P. Deitsch
City Attorney
4
Mayor of the City of Arcadia
STATE OF CALIFORNIA )
COUNTY OF LOS ANGELES) SS:
CITY OF ARCADIA )
I, JAMES H. BARROWS, City Clerk of the City of Arcadia, hereby certifies
that the foregoing Resolution No. 6499 was passed and adopted by the City Council of
the City of Arcadia, signed by the Mayor and attested to by the City Clerk at a regular
meeting of said Council held on the 6th day of December, 2005 and that said
Resolution was adopted by the following vote, to wit:
AYES: Council Member Chandler, Kovacic, Marshall, Segal and Wuo
NOES: None
ABSENT: None
5
ISI JAMES H. BARROWS
City Clerk of the City of Arcadia
2664.7.2
2664.7.2. SAME. CLAIMS.
A transient may obtain a refund of taxes over-
paid or paid more than once or erroneously or
illegally collected or received by the City by filing
a claim in the manner provided in Section
2664.7, but only when the tax was paid by the
transient directly to the Tax Administrator, or
when the transient having paid the tax to the
operator establishes to the satisfaction of the Tax
Administrator that the transient has been unable
to obtain a refund from the operator who col-
lected the tax.
2664.73. SAME. PROOF.
No refund shall be paid under the provisions
of this Part unless the claimant establishes his
right thereto by written records showing entitle-
ment thereto.
2664.8. ACTION TO COLLECT.
Any tax required to be paid by any transient
under the provisions of this Part shall be deemed
adebt owed by the transient to the City. Any such
tax collected by an operator which has not been
paid to the City shall be deemed a debt owed by
the operator to the City. Any person owing
money to the City under the provisions of this
Part shall be liable to an action brought in the
name of the City for the recovery of such
amount.
2664.9. VIOLATIONS.
No person shall fail or refuse to register as
required by this Part, or to furnish any return
required to be made by this Part, or fail or refuse
to furnish a supplemental return or other data
required by the Tax Administrator. No person
required to make, render, sign or verify any
report, return or claim shall make any false or
fraudulent report, return or claim with intent to
defeat or evade the determination required by
this Part to be made of any amount due. No
person shall fail or refuse to pay any sum
required by this Part to be paid.
56
(Part 6, Divisions 1, 2, 3 and 4, added to Chapter
6 by Ord. 1259 adopted 10 -6 -64; effective
11 -6 -64. Tax Provisions operative 2 -1 -65)
(Former Part 7 entitled "Cigarette Tax" consist-
ing of Sections 2671 through 2673.9, added by
Ord. 1340 adopted 3- 30 -67, repealed by Ord.
1356 adopted 8- 15 -67. Also former Part 7
entitled "Parking Tax" consisting of Sections
2671 through 2671.7, added by Ord. 1387,
adopted 9- 17 -68, repealed by Ord. 1403 adopted
I1- 18-69)
PART 7.
UTILITIES TAY
2670. DEFINITIONS.
The definitions given in this section govern the
construction of this Part.
(a) "Person" shall mean any domestic or for-
eign corporation, firm, association, syndicate,
joint stock company, partnership of any kind,
joint venture, club, Massachusetts business or
common -law trust, society, individual, or
municipal corporation.
(b) "City" shall mean the City of Arcadia.
(c) "Telephone corporation, " "electrical cor-
poration, " "gas corporation, " "water corpora-
tion," and "cable television corporation" shall
have the same meanings as defined in Sections
234, 218, 222, 241, and 215.5, respectively, of the
Public Utilities Code of the State of California, as
said sections existed on January 1. 1970. except
that "water corporation," shall not mean or
include the City of Arcadia.
(d) "Tax Administrator" shall mean the
Finance Director of the City of Arcadia.
(e) "Service Supplier" shall mean a person
required to collect and remit a tax imposed by
this Part.
(f) "Service User" shall mean a person
required to pay a tax imposed by this Part.
(g) "Month" shall mean a calendar month.
r'
2671. TELEPHONE TAX.
(a) There is hereby imposed a tax upon every
person in the City, using intrastate, interstate and
international communication services, including
cellular telephone services and the telephone
services that gain access to the Public Switched
Network (PSN), by means of various technolo-
gies, by every person in the City using such ser-
vices. The tax imposed by this section shall be at
the rate of five percent (5%) of all charges made
for such services and shall be paid by the person
paying for such service.
(b) As used in this Section, the term "charges"
shall not include charges for services paid for by
inserting coins in coin - operated telephones except
that where such coin - operated telephone service
is furnished for a guaranteed amount, the amounts
paid under such guarantee plus any fixed monthly
or other periodic charge shall be included in the
base for computing the amount of tax due; nor
shall the term "telephone communication servic-
es" include land mobile services or maritime
mobile services as defined in Section 2.1 of Title
47 of the Code of Federal Regulations, as such
section existed on January 1, 1970.
(c) Notwithstanding the provisions of subsec-
tion (a), the tax imposed under this section shall
not be imposed upon any person for using intra-
state, interstate and international communication
services to the extent that the amounts paid for
such services are exempt from or not subject to
the tax imposed by section 4251 of Title 26 of the
United States Code, as such section existed on
January 1, 1970 without regard to subsection (b)
thereof.
(d) The tax on cellular access charges shall be
effective on December 2, 1993. (Amended by
Ord. 1645 adopted 6/30/78; amended by Ord.
1909 adopted 8 -1 -89; amended by Ord. 1997
adopted 11 -2 -93)
(Part 7 added by Ord. 1415 adopted 6- 30 -70)
2671
2671.1. ELECTRICITY TAX.
(a) There is hereby imposed a tax upon every
person in the City using electrical energy in the
City. The tax imposed by this section shall be at
the rate of seven percent (7%) of the charges
made for such energy and shall be paid by the
person paying for such energy. "Charges," as
used in this section, shall include charges made
for (1) metered energy, and (2) minimum charges
for service, including customer charges, service
charges, demand charges, standby charges, and
annual and monthly charges.
(b) As used in this section the term "using elec-
trical energy" shall not be construed to mean the
storage of such energy by a person in a battery
owned or possessed by him for use in an automo-
bile or other machinery or device apart from the
premises upon which the energy was received,
provided however, that the term shall include the
receiving of such energy for the purpose of using
it in the charging of batteries. The term shall not
include electricity used in water pumping by
water corporations; nor shall the term include the
mere receiving of such energy by an electrical
corporation at a point within the City for resale.
(Amended by Ord. 1645 adopted 6130/78)
2671.2. GAS TAX.
(a) There is hereby imposed a tax upon every
person in the City using gas in the City which is
delivered through mains or pipes. The tax im-
posed by this section shall be at the rate of seven
percent (7%) of all charges made for such gas and
shall be paid by the person paying for such gas.
(b) There shall be excluded from the base on
which the tax imposed in this section is computed
(1) charges made for gas which is to be resold and
delivered through mains or pipes; (2) charges
made for gas to be used in the generation of elec-
trical energy by an electrical corporation; and (3)
charges made by a gas public utility for gas used
and consumed in the conduct of the business of
gas public utilities. (Amended by Ord. 1645
adopted 6130/78)
57 (A,ceAe 1-94)
2671.3
2671.3. WATER TAX.
There is hereby imposed a tax upon every
person in the City using water in the City which
is delivered through mains or pipes of a water
corporation. The tax imposed by this section shall
be at the rate of seven percent (7%) of the charges
made for such water and shall be paid by the
person paying for such water. (Amended by Ord.
1645 adopted 6130/78)
2671.4. (Repealed by Ord. 1418 adopted
9 -1 -70)
2671.5. WATER TAX SUSPENDED.
The provisions of Arcadia Municipal Code
Section 2671.3 are hereby suspended effective
July 1, 1979 and shall not again be of any force
and effect until the commencement of the City's
fiscal year following the adoption of a declaration
of intention to pay out of City funds the whole or
a stated percentage of the amount of taxes to be
derived from the area of the Metropolitan Water
District within the City pursuant to the Metropoli-
tan Water District Act, as amended from time to
time. (Added by Ord. 1677 adopted 5- 15 -79)
2671.6. INDEFINITE SUSPENSION OF
A PORTION OF THE UTILITY
USER TAX RATE.
That notwithstanding the utility user tax rates
set forth in Subsections 2671(a), 2671.1 (a), and
2671.2 (a), of this Code, the utility user tax rate
for telephones shall be five percent (5 %) of the
charges for such telephone, the utility user tax
rate for electricity shall be five percent (5 %) of
the charges for such electricity, and the utility
user tax rate for gas shall be five percent (5 %) of
the charges for such gas. That during such time as
this Section of the Arcadia Municipal Code is in
effect, the utility user tax rates imposed by
Subsections 2671 (a), 2671.1(a), and 2671.2 (a)
over the rate set forth in this Section, shall be
suspended, and shall not be collected. The rate set
forth in this Section shall not be operative as to a
service user and the duty to collect the tax pur-
(Arcadia 1 -94) 58
suant to such rate from a service user shall not
commence until the beginning of the first regular
billing period applicable to that service user
which starts on orafterJune 3, 1980. Where aser-
vice user receives more than one (1) billing, one
or more being for different periods than another,
the rate set forth in this Section shall be operative,
and the duty to collect the tax pursuant to said
rate shall arise separately for each billing period.
(Added by Ord. 1704 adopted 6 -3 -80)
2671.7. UTILITIES TAX CAP.
Each fiscal year after the City's 1980 -1981
fiscal year, the City Council may by resolution
instruct the tax administrator to order all service
suppliers to not collect the tax imposed by this
Part for such period of time the tax administrator
determines necessary to limit the total tax revenue
received by the City pursuant to this Part for the
fiscal year to not more than the total tax revenue
received by the City pursuant to this Part for the
prior fiscal year plus, approximately, an addition-
al ten percent (10 %) of said prior fiscal year.
(Added by Ord. 1735 adopted 11- 17 -81)
2672. EXEMPTIONS.
Nothing in this Part shall be construed as im-
posing a tax upon any person if imposition of
such tax upon that person would be in violation
of the Constitution of the United States or the
Constitution of the State of California.
2672.1. EXEMPTION.
The tax imposed by this Part 7 shall not apply
during any calendar year to any of the following:
(a) Heads of households under the California
Personal Income Tax Law for the year for which
said taxes were due.
(b) A husband and wife whose sum of adjusted
gross income as used for purposes of the Califor-
nia Personal Income Tax Law for the year for
which said taxes were due was no more than
$12,000.
(c) Any person whose adjusted gross income
as used for purposes of the California Personal
2672.1
Income Tax Law for the year in which said taxes
J were due was no more than $7,500.
(d) Any person who meets the criterion of dis-
ability as established by the Social Security
58 -1 (Arcadia 1-94)
Administration's Supplemental Income pro-
gram for the Aged, Blind and Disabled. (Title
XVI of the Social Security Act as amended.
(Added by Ord. 1506 adopted 7- 16 -74, amended
by Ord. 1695 adopted 3- 18 -80)
2672.1.1. SAME. APPLICATION.
(a) An exempt person may apply for and
receive an exemption from such taxes from the
office of the Finance Director of the City of
Arcadia upon presentation of proof of adjusted
gross income or proof of qualification under
Social Security Supplemental Income to the sat-
isfaction of the office of the Finance Director.
(b) Any application for an exemption as
above allowed shall be upon forms supplied by
the Finance Director and statements made
therein shall be under oath and subject to the
penalties of perjury.
(c) The Finance Director shall review each
application and if he determines that an exemp-
tion is allowable in accordance herewith, he shall
process the application for exemption and shall
effectuate the exemption by transmitting the
necessary determination and information to the
applicable utility companies. Upon receipt
thereof, the utility companies shall refrain from
billing such exempt user in accordance with this
Section. If the Finance Director determines that
the application is faulty or that the applicant has
failed to truthfully set forth such facts, he may
deny such application by giving written notice to
the applicant. The applicant shall thereafter have
the right to appeal the Finance Director's deci-
sion to the City Council within a ten (10) day
period after the date of mailing of the rejection by
the Finance Director, or in the alternate. the
applicant may file an amended application for
exemption for reprocessing. (Added by Ord.
1506 adopted 7- 16 -74)
2672.1.2. SAME. TIME FOR
SUBMISSION OF
APPLICATION.
(a) An application for an exemption for the
59
2672.1
first full calendar year of 1975 shall be submitted
to the Finance Director during the month of
October, 1974, but not later than October 31,
1974. Exemptions so allowed shall commence
from the first billing period following December
31, 1974, and shall continue until the close of the
billing period following December 31, 1975.
(b) An application for any subsequent calen-
dar year shall be submitted during the month of
October preceding said calendar year, but not
later than October 31, and shall be effective for
the subsequent calendar year in the same man-
ner as set forth in subsection (a) of this section.
(c) Applications for exemptions may be filed
for the remaining portion of a calendar year, but
such application shall be filed not later than the
sixtieth day prior to the commencement date of
the billing period for the affected utility com-
panies for which the exemption is to commence
and shall be valid through the remainder of that
calendar year, as set forth in subsection (a) of this
section. (Added by Ord. 1506 adopted 7- 16 -74)
2672.1.3. SAME. FAILURE TO APPLY
WAIVES EXEMPTION.
In the event no exemption is applied for all
right to claim such exemption or refund for the
period prior to the time an exemption is allowed
and is to commence shall be considered to be
void and extinguished permanently. (Added by
Ord 1506 adopted 7- 16 -74, amended by Ord.
1695 adopted 3- 18 -80)
2672.1.4. NOTICE TO UTILITY
COMPANIES.
The Director of Finance shall furnish the
affected utility companies from time to time with
a list of persons who are qualified for exemption
from the imposition of utility users' tax under
this Section.
The list will indicate:
(a) Service users continuing to qualify for
exemption.
(b) Persons no longer qualified for exemption
who had been previously exempt. This list will be
2672.1.4
the official determination by which the service
supplier will provide exemption from the utility
users' tax.
The list provided to the service supplier shall
include the name, service address, billing
address, and utility service.
Exemptions during the calendar year shall be
forwarded to the affected utility companies forty -
five (45) days and shall not be effective until the
next complete billing period following said forty -
five day period. (Added by Ord. 1506 adopted
7- 16 -74, amended by Ord. 1695 adopted 3- 18 -80)
2673. COLLECTION OF TAX.
(a) Every person receiving payment of
charges from a service user shall collect the
amount of tax imposed by this Part from the
service user.
(b) The tax shall be collected insofar as prac-
ticable at the same time as and along with the
collection of charges made in accordance with
the regular billing practice of the service supplier.
If the amount paid by a. service user is less than
the full amount of the charge and tax which has
accrued for the billing period, a proportionate
share of both the charge and the tax shall be
deemed to have been paid, unless the full amount
of the charge is paid or the service user gives
notice that he refuses to pay the tax.
(c) Where the remittance of taxes collected is
based upon an estimated percentage collected of
the total amount billed, the service supplier may
submit a payment plan to the Tax Administrator
for his approval.
(d) The duty to collect tax from a service user
shall commence with the beginning of the first
regular billing period applicable to that person
which starts on or after September 1, 1970.
Where a person receives more than one (1) bill-
ing, one or more being for different periods than
another, the duty to collect shall arise separately
for each billing period.
.1
2674. REPORTING AND
REMITTING.
Each service supplier shall, on or before the
twentieth of each month, make a return to the
Tax Administrator on forms provided by him
stating the amount of taxes billed by the service
supplier during the preceding month. At the time
the return is filed, the full amount of the tax
collected shall be remitted to the Tax Admin-
istrator. The Tax Administrator is authorized to
require such further information as he deems
necessary to properly determine if the tax here
imposed is beini levied and collected in accord-
ance with this ordinance. Returns and remit-
tances are due immediately upon cessation of
business for any reason.
2675. PENALTY.
(a) Taxes collected from a service user which
are not remitted to the Tax Administrator on or
before the due dates provided in this Part are
delinquent.
(b) Penalties for delinquency in remittance of
any tax collected shall attach and be paid by the
person required to collect and remit at the rate of
fifteen percent (15%) of the total tax collected.
(c) The Tax Administrator shall have power
to impose additional penalties upon persons
required to collect and remit taxes under the
provisions of this ordinance for fraud or negli-
gence in reporting or remitting at the rate of
fifteen percent (15%) of the amount of the tax
collected or as recomputed by the Tax Admin-
istrator.
(d) Every penalty imposed under the provi-
sions of this Section shall become apart of the tax
required to be remitted.
2676. ACTIONS TO COLLECT.
Any tax required to be paid by a service user
under the provisions of this Part shall be deemed
a debt owed by the service user to the City. Any
such tax collected from a service user which has
not been remitted to the Tax Administrator shall
be deemed a debt owed to the City by the person
required to collect and remit. Any person owing
money to the City under the provisions of this
Part shall be liable to an action brought in the
name of the City for the recovery of such
amount.
2677. FAILURE TO PAY TAX.
PENALTY.
Whenever a service user has failed to pay the
amount of the tax for a period of two (2) or more
billing periods, or whenever the Tax Admin-
istrator deems it in the best interest ofthe City, he
may relieve the service suppiier of the obligation
to collect taxes due under this Part from certain
named service users for specified billing periods.
The Tax Administrator shall notify the service
user that he has assumed responsibility to collect
the taxes due for the stated periods and demand
payment of such taxes. The notice shall be served
on the service user by handing it to him person-
ally or by deposit of the notice in the United
States mail, postage prepaid thereon, addressed
to the service user at the address to which billing
was made by the service supplier or, should the
service user have changed his address, to his last
known address. If a servise user fails to remit the
tax to the Tax Administrator within fifteen (15)
days from the date of the service of the notice
upon him, which shall be the date of mailing if
service is not accomplished in person, a penalty
of twenty-five percent (25%) ofthe amount ofthe
tax set forth in the notice shall be imposed, but
not less than Five Dollars ($5.00). The penalty
shall become part of the tax herein required to be
paid.
2678. RECORDS.
It shall be the duty of every person required to
collect and remit to the City any tax imposed by
this Part to keep and preserve for a period of three
(3) years all records as may be necessary to deter-
mine the amount ofsuch tax as he may have been
liable for the collection of and remittance to the
Tax Administrator, which records the Tax
2676
Administrator shall have the right to inspect at all
reasonable times.
2679. REFUNDS.
(a) Whenever the amount of any tax has been
overpaid or paid more than once or has been
erroneously or illegally collected or received by
the Tax Administrator under this Part, it may be
refunded as provided in this Section.
(b) A person required to collect and remit
taxes imposed under this Part may claim a refund
or take as credit against taxes collected and
remitted the amount overpaid, paid more than
once or erroneously or illegally collected or
received when it is established in a manner pre-
scribed by the Tax Administrator that the service
user from whom the tax has been collected did
not owe the tax; provided,. however, that neither
a refund nor a credit shall be allowed unless the
amount of the tax so collected has either been
refunded to the service user or credited to charges
subsequently payable by the service user to the
person required to collect and remit.
(c) No refund shall be paid under the provi-
sions of this Section unless the claimant estab-
lishes his right thereto by written records showing
entitlement thereto.
(d) Notwithstanding other provisions of this
Section, whenever a service supplier, pursuant to
an order of the California Public Utilities Com-
mission or a court of competent jurisdiction,
makes a refund to service users of charges for past
utility services, the taxes paid pursuant to this
Code on the amount of such refunded charges
shall also be refunded to service users, and the
service supplier shall be entitled to claim a credit
for such refunded taxes against the amount of tax
which is due upon the next monthly returns. In
the event this Code is repealed, the amounts of
any refundable taxes will be borne by the City.
(Amended by Ord. 1826 adopted 1- 21 -86)
(Part 7 added by Ord. 1415 adopted 6- 30 -70)
61 (Arcadia 6.86)