SUBJECT: ORDINANCE OF THE CITY COUNCIL OF THE CITY OF

Agenda Item No. 6A February 28, 2017

TO: Honorable Mayor and City Council Members Attention: Jeremy Craig, Interim City Manager FROM: Mark Mazzaferro, Public Information Officer

(Staff Contact: Mark Mazzaferro, (707) 449-5371) SUBJECT: ORDINANCE OF THE CITY COUNCIL OF THE CITY OF VACAVILLE REPEALING

CHAPTER 13.04 OF THE VACAVILLE MUNICIPAL CODE RELATING TO CABLE SYSTEM REGULATIONS, AND ADOPTING A NEW CHAPTER 13.04: STATE VIDEO SERVICE FRANCHISES (Second Reading)

DISCUSSION: In 2006, the Legislature of the State of California adopted the Digital Infrastructure and Video Competition Act of 2006 (DIVCA), which became effective January 1, 2007. At the time, the City of Vacaville was in the first year of a 10-year franchise agreement with Comcast to provide video and other services in Vacaville and was not under the governance of DIVCA. Since that time, AT&T U-Verse began offering video services in Vacaville under a State franchise agreement. AT&T has been complying with DIVCA and paying a 5% franchise fee to the City. As the City does not have a DIVCA ordinance in place, AT&T has not been collecting or paying any Public, Education and Government (PEG) fees to the City. Comcast notified the City in August that, when the current franchise agreement with the City expires on October 26, 2016, it would be adding the City of Vacaville to its current State franchise, creating the need for the City to amend its current cable system ordinance and adopt a new ordinance to comply with the DIVCA regulations. Rather than add or subtract various sections of the current ordinance, staff is recommending repealing the current cable system regulations and adopting new State video service franchise regulations. The new regulations are fairly similar to the existing regulations in terms of customer service standards and payment to the City of a 5% franchise fee. Adoption of these new regulations will allow the City to collect a video service PEG fee of 1% of gross revenues from both Comcast and AT&T that will allow continued government access channel broadcasting and programming, replace aging equipment, and maintain facilities in the City of Vacaville. The City Council approved the first reading of this ordinance at its regular meeting on February 14, 2017. FISCAL IMPACT: Adoption of this ordinance could result in revenues for PEG channels of over $200,000 annually. RECOMMENDATION: By simple motion, adopt the subject ordinance. ATTACHMENTS: Ordinance – Action Item Attachment 1: Current Chapter 13.04 (being repealed by the new ordinance)

ORDINANCE NO.

ORDINANCE OF THE CITY COUNCIL OF THE CITY OF VACAVILLE REPEALING CHAPTER 13.04 OF THE VACAVILLE MUNICIPAL CODE RELATING TO CABLE

SYSTEM REGULATIONS, AND ADOPTING A NEW CHAPTER 13.04: STATE VIDEO SERVICE FRANCHISES

WHEREAS, the Legislature of the State of California has adopted the Digital Infrastructure and

Video Competition Act of 2006 (DIVCA), which became effective on January 1, 2007; and

WHEREAS, DIVCA establishes a regulatory structure for the State to be the exclusive

authority to issue franchises to video service providers; and

WHEREAS, DIVCA establishes that local entities, such as the City of Vacaville, are

responsible for administration and implementation of certain provisions of DIVCA; and

WHEREAS, DIVCA allows for the City to establish, by ordinance, provisions for franchise fees;

for Public, Educational and Governmental (PEG) channel facilities and fees; enforcement of customer

service standards; and other regulations that are not in conflict with DIVCA or other state law.

NOW, THEREFORE, the City Council of the City of Vacaville, approves as follows:

SECTION 1. Vacaville Municipal Code Chapter 13.04 relating to Cable System Regulations

is repealed and replaced with a new Chapter 13.04 State Video Service Franchises to read in full as

follows:

Chapter 13.04

STATE VIDEO SERVICE FRANCHISES

Sections: 13.04.010 General provisions. 13.04.020 Definitions. 13.04.030 Franchise fees - audits. 13.04.040 Customer service - penalties. 13.04.050 Permits and construction. 13.04.060 Emergency alert. 13.04.070 Public, educational, and government access channel capacity,

interconnection, signal carriage and support. 13.04.080 Notices.

13.04.010 General provisions. A. Purpose. This Chapter is intended to be applicable to video service providers who have been awarded a

state video franchise under California Public Utilities Code Section 5800 et seq. (the Digital Infrastructure and Video Competition Act of 2006 [“DIVCA”]), to serve any location(s) within the incorporated boundaries of the City. It is the purpose of this Chapter 13.04 to implement the provisions of DIVCA and the rules of the California Public Utilities Commission promulgated thereunder that are applicable to a “local franchising entity” or a “local entity” as defined in DIVCA.

Except as otherwise provided herein or by State or federal law, no cable operator or video

service provider shall provide video service within the City of Vacaville without a state video franchise. B. Rights Reserved. 1. The rights reserved to the City under this Chapter 13.04 are in addition to all other

rights of the City, whether reserved by this Chapter 13.04 or authorized by law, and no action, proceeding or exercise of a right shall affect any other rights which may be held by the City.

2. Except as otherwise provided by DIVCA, a state franchise shall not include, or be a

substitute for: a. compliance with generally applicable requirements for the privilege of transacting and

carrying on a business within the City, including, but not limited to, compliance with the conditions that the City may establish before facilities may be constructed for, or providing, non-video services;

b. any permit or authorization, other than a state franchise, required in connection with

operations on or in public rights-of-way or public property, including, but not limited to, encroachment permits, street work permits, pole attachment permits and street cut permits; and

c. any permit, agreement or authorization for occupying any other property of the City or

any private person to which access is not specifically granted by the state franchise. 3. The City reserves the right to construct, operate, maintain or repair its own cable

system or video service provider network. C. Compliance with Chapter 13.04. Nothing contained in this Chapter 13.04 shall ever be construed so as to exempt a state

franchisee from compliance with all ordinances, rules or regulations of the City now in effect or which may be hereafter adopted which are consistent with this section or Public Utilities Code Section 5800 et seq.

13.04.020 Definitions. For purposes of this Chapter 13.04, the following terms, phrases, words, and their derivations

shall have the meaning given in this section. Unless otherwise expressly stated, words not defined in this section shall have the same meaning as established in (1) DIVCA, and if not defined therein, (2) California Public Utilities Commission rules implementing DIVCA, and if not defined therein, (3) the Communications Act of 1934, as amended, at 47 U.S.C. Section 521, et. seq., and if not defined therein, then (4) their common and ordinary meaning. If specific provisions of law referred to herein are renumbered, then the reference shall be read to refer to the renumbered provision.

“Access”, “PEG access”, “PEG use”, or “PEG” means the availability of a cable or video

service provider system for public, educational, or governmental use by various agencies, institutions, organizations, groups, and individuals, including the City and its designated access providers, to acquire, create, and distribute programming not under a state franchise holder's editorial control.

1. “Public access” or “Public use” means access where organizations, groups, or

individual members of the general public, on a non-discriminatory basis, are the primary or designated programmers or users having editorial control over their communications;

2. “Education access” or “Education use” means access where accredited educational

institutions are the primary or designated programmers or users having editorial control over their communications;

3. “Government access” or “Government use” means access where government

institutions or their designees are the primary or designated programmers or users having editorial control over their communications.

“Commission” means the California Public Utilities Commission. “City Manager” means the City Manager of the City of Vacaville or the designee of the City

Manager. “Gross revenues” means all revenues actually received by the holder of a state franchise that

are derived from the operation of the holder's network to provide cable service or video service within the incorporated areas of the City, subject to the provisions of Public Utilities Code Section 5860.

“State franchisee” means a cable operator or video service provider that has been issued a

franchise by the commission to provide cable service or video service, as those terms are defined in Public Utilities Code Section 5830, within any portion of the incorporated limits of the City.

“Video service provider” has the meaning set forth in DIVCA and, in addition refers collectively

to any cable operator, video service provider or open video system (“OVS”) operator as defined in DIVCA that has been issued a franchise by the commission to provide cable service or video service.

13.04.030 Franchise fees - audits. A. State franchise fees. Any state franchisee operating within the incorporated areas of the City shall pay to the City a

state franchise fee equal to five percent of gross revenues. B. Payment of franchise fees. The state franchise fee required pursuant to this section shall be paid quarterly, in a manner

consistent with Public Utilities Code Section 5860. The state franchisee shall deliver to the City, by check or other means agreed to by the City, a payment for the state franchise fee not later than forty-five days after the end of each calendar quarter. Each payment made shall be accompanied by a report, detailing how the payment was calculated, and shall include such additional information as reasonably designated by the City.

C. Late Payments. In the event a state franchisee fails to make payments required by this section on or before the

due dates specified in this section, the City shall impose a late charge at the rate per year equal to the highest prime lending rate during the period of delinquency, plus one percent.

D. Audits. The City may audit the business records of state franchisees in a manner consistent with

Public Utilities Code Section 5860(i).

13.04.040 Customer service - penalties. A. Customer service standards. A state franchisee shall comply with sections 53055, 53055.1, 53055.2 and 53088.2 of the

California Government Code; the FCC customer service and notice standards set forth in sections 76.309, 76.1602, 76.1603, and 76.1619 of Title 47 of the Code of Federal Regulations; Section 637.5 of the California Penal Code; the privacy standards of section 551 of Title 47 of the United States Code; and, to the extent consistent with DIVCA, all other applicable state and federal customer service and consumer protection standards pertaining to the provision of video service, including any such standards hereafter adopted. In case of a conflict, the stricter standard shall apply. All customer service and consumer protection standards under this section shall be interpreted and applied to accommodate newer or different technologies while meeting or exceeding the goals of the standards.

B. Penalties for violations of standards. If the City Manager determines there is a violation by a state franchisee of customer service

standards set forth in subsection (A), the City Manager shall enforce compliance with such standards as follows:

1. The City Manager will provide the state franchisee with written notice of any material

breaches of the applicable customer service standards, and will allow the state franchisee thirty days from the receipt of the notice to remedy the specified material breach.

2. Material breaches not remedied within the thirty-day time period will be subject to the

following penalties, provided that no penalty shall be imposed for material breaches if the breach is outside the reasonable control of the state franchisee:

a. For the first occurrence of a material breach, a fine of five hundred dollars may be

imposed for each day the violation remains in effect, not to exceed one thousand five hundred dollars for each violation.

b. For a second material breach of the same nature within twelve months, a fine of one

thousand dollars may be imposed for each day the violation remains in effect, not to exceed three thousand dollars for each violation.

c. For a third material breach of the same nature within twelve months, a fine of $2,500 may be imposed for each day the violation remains in effect, not to exceed seven thousand five hundred dollars for each violation.

d. For the purposes of this Chapter, material breach shall have the meaning set forth in California Public Utilities Code section 5900.

3. Any interested person may seek judicial review of the City Manager’s determination of

a material breach and imposition of penalties as set forth in California Public Utilities Code section 5900.

C. Payment of Penalties. Any penalty imposed on a state franchisee shall be paid to the City. As provided for in Public

Utilities Code Section 5900(g), the City shall submit one-half of all penalties received to the Digital Divide Account established in Public Utilities Code Section 280.5.

13.04.050 Permits and Construction. A. Except as otherwise expressly provided in this chapter, the provisions of the Vacaville

Municipal Code, the Land Use and Development Code (Title 14 of the Vacaville Municipal Code) and all City administrative rules and regulations regarding development in the City, or use of or encroachment into the public rights-or-way, as now existing or as hereafter amended, shall apply to all work performed by or on behalf of a state franchisee on any City public rights-of-way, public utility easements, public property or City easement, including, but not limited to the obligation to obtain an encroachment permit for such work.

B. Permits. Prior to commencing any work for which an encroachment permit is required by subsection (A), a state franchisee shall apply for and obtain any necessary permits and shall comply with all other applicable laws and regulations, including all applicable requirements of Division 13 of the Public Resources Code, Section 21000, et seq. (the California Environmental Quality Act).

1. The City Manager shall either approve or deny a state franchisee’s application for any

encroachment permit required under subsection (A) within sixty days of receiving a completed permit application.

2. If the City Manager denies a state franchisee’s application for an encroachment permit,

the City Manager shall furnish to the state franchisee a detailed explanation of the reason or reasons for the denial.

3. A state franchisee that has been denied a permit by final decision of the City Manager

may appeal the denial To the City Council. Upon receiving a notice of appeal, the City Council shall take one of the following actions:

a. Affirm the action of the City Manager without any further hearing; or b. Refer the matter to the City Manager for further review with or without instructions;

or c. Set the matter for a de novo hearing before the City Council.

4. The issuance of an encroachment permit is not a franchise, and does not grant any

vested rights in any location in the public rights-or-way, or in any particular manner of placement within the rights-or-way. Without limitation, a permit to place cabinets and similar appurtenances aboveground may be revoked and the permittee required to place facilities underground, in accordance with applicable law.

C. Notification to residents regarding construction or maintenance. Prior to any construction, rebuild, or upgrade of a cable or video system, a state franchisee

shall establish procedures to notify City residents in the impacted area of construction schedules and activities. Every attempt shall be made to provide notices by the state franchisee to impacted residents and occupants in the construction area a minimum of forty-eight hours prior to the planned construction and additionally on the day of construction. The notice may be in the form of door hangers that indicate, at a minimum, the dates and times of construction and the name and telephone number of an authorized contact.

D. Should there be aboveground or underground installations (excluding aerial cable lines

utilizing existing poles and cable paths) which will affect the private property, such notice shall be in writing and shall contain specific information regarding such installations which will affect the private property.

E. To the extent practicable, aboveground or underground equipment placed on private

property shall be placed at the location requested by the property owner. A state franchisee holder shall provide the private property owner with at least twenty days advance written notice of its plans to install such equipment, before installing its appurtenances.

F. In addition to any other notice of proposed entry required under this section, a state

franchisee’s personnel shall make a reasonable attempt to give personal notice to residents immediately preceding entry on private property or public ways or public easements adjacent to or on such private property.

G. Identification required. A state franchisee, its employees, agents, contractors, and subcontractors shall be properly

identified as agents of the state franchisee prior to and during entry on private and public property. Identification shall include the name and telephone number of the state franchisee on all trucks and vehicles used by installation personnel.

H. Restoration of private and public property. After the performance of work, the state franchisee shall restore such private and public

property to a condition equal to or better than its condition prior to construction. Any disturbance of landscaping, fencing, or other improvements upon private or public property shall, at the sole expense of the state franchisee, be promptly repaired or restored (including replacement of shrubbery and fencing) to the reasonable satisfaction of the property owner, in addition to the furnishing of camouflage plants on public property.

13.04.060 Emergency alert.

A. Each state franchisee shall comply with the emergency alert system requirements of

the Federal Communications Commission, and any State or local emergency alert systems or plans prepared pursuant thereto, in order that emergency messages may be distributed over the state franchisee’s network.

13.04.070 Public, educational and government access channel capacity, interconnection,

and signal carriage. A. PEG channel capacity.

1. A state franchisee that has been authorized by the California Public Utilities Commission to provide video service in the City shall designate and activate three PEG channels within three months from the date that the City requests that the state franchisee designate and activate the PEG channels. However, this three-month period shall be tolled for such a period, and only for such a period, during which the state franchisee's ability to designate or provide such PEG capacity is technically infeasible, as provided in Public Utilities Code Section 5870(a).

2. A state franchisee shall provide an additional PEG channel when the standards set

forth in Public Utilities Code Section 5870(d) are satisfied by the City or any entity designated by the City to manage one or more of the PEG channels.

B. PEG support fee. 1. Any state franchisee operating within the City shall pay to the City a PEG support fee

equal to one percent of gross revenues. 2. The PEG support fee shall be used for PEG purposes that are consistent with state

and federal law. 3. A state franchisee shall remit the PEG support fee to the City quarterly, within forty-five

days after the end of each calendar quarter. Each payment made shall be accompanied by a report, detailing how the PEG support fee was calculated.

4. If a state franchisee fails to pay the PEG support fee when due, or underpays the

proper amount due, the state franchisee shall pay a late payment charge at the rate per year equal to the highest prime lending rate during the period of delinquency, plus one percent.

C. PEG carriage and interconnection. 1. State franchisees shall ensure that all PEG channels are receivable by all subscribers,

whether they receive digital or analog service, or a combination thereof, without the need for any equipment other than that needed to receive the lowest cost tier of service. PEG access capacity provided by a state franchisee shall be of similar quality and functionality to that offered by commercial channels (unless the PEG signal is provided to the state franchisee at a lower quality or with less functionality), shall be capable of carrying a National Television System Committee (NTSC) quality television signal, and shall be carried on the state franchisee's lowest cost tier of service. To the extent feasible, the PEG channels shall not be separated numerically from other channels carried on the lowest cost tier of service and the channel numbers for the PEG channels shall be the same channel numbers used by any incumbent cable operator, unless prohibited by federal law. After the initial designation of the PEG channel numbers, the channel numbers shall not be changed without the agreement of the City unless federal law requires the change.

2. A state franchisee and an incumbent cable operator shall negotiate in good faith to

interconnect their networks for the purpose of providing PEG programming. If a state franchisee and an incumbent cable operator cannot reach a mutually acceptable interconnection agreement for PEG carriage, the City shall require the incumbent cable operator to allow the state franchisee to interconnect its network with the incumbent cable operator's network at a technically feasible point on the state franchisee's network as identified by the state franchisee. If no technically feasible point of interconnection is available, the state franchisee shall make interconnection available to the PEG channel originator and shall provide the facilities necessary for the interconnection. The cost of any interconnection shall be borne by the state franchisee requesting the interconnection unless otherwise agreed to by the parties.

13.04.080 Notices. Each state franchisee or applicant for a state franchise shall file with the City a copy of all

applications or notices that the state franchisee holder or applicant is required to file with the California Public Utilities Commission. All notices or other documentation that a state franchisee holder is required to provide to the City under this section or the Public Utilities Code shall be provided to the City Manager.

SECTION 2. The City Council finds that adoption of this ordinance is not a project as defined

by 14 California Code of Regulations 15378 (State CEQA Guidelines) and therefore CEQA is not

applicable.

SECTION 3. If any section, subsection, sentence, clause, phrase or word of this Ordinance

is for any reason held to be invalid by a court of competent jurisdiction, such decision shall not affect

the validity of the remaining portions of this ordinance. The City Council of the City of Vacaville

hereby declares it would have passed and adopted this Ordinance and each and all provisions hereof

irrespective of the fact that any one or more of said provisions be declared invalid.

SECTION 4. This ordinance shall be effective thirty (30) days from and after the date of its

passage.

SECTION 5. This ordinance shall be published in accordance with the provisions of

Government Code Section 36933.

I HEREBY CERTIFY that this ordinance was INTRODUCED at a regular meeting of the City Council of the City of Vacaville, held on the 14th day of February, 2017, and ADOPTED AND PASSED at a regular meeting of the City Council of the City of Vacaville, held on the 28th day of February, 2017, by the following vote:

AYES:

NOES: ABSENT:

ATTEST: APPROVED: ________________________________ ________________________________ Michelle A. Thornbrugh, City Clerk Leonard J. Augustine, Mayor Date:____________________________

EXISTING CHAPTER 13.04 – TO BE REPEALED

Attachment 1

Chapter 13.04 CABLE SYSTEM REGULATIONS

Sections:

13.04.010 Intent. 13.04.020 Short title. 13.04.030 Definitions. 13.04.040 Franchise terms and conditions. 13.04.050 Initial franchise applications and renewal. 13.04.060 Minimum consumer protection and service standards. 13.04.070 Franchise fee and financial requirements. 13.04.080 Construction requirements. 13.04.090 Technical standards. 13.04.100 Indemnification and insurance requirements. 13.04.110 Records and reports. 13.04.120 Review of system performance. 13.04.130 Franchise violations. 13.04.140 Force majeure – Grantee’s inability to perform. 13.04.150 Abandonment or removal of franchise property. 13.04.160 Grantor and subscriber rights.

13.04.010 Intent.

A. Authority. The City of Vacaville pursuant to applicable federal and state law, is authorized to grant one or more nonexclusive franchises to install, construct, operate, upgrade, maintain and reconstruct “cable systems” (as defined in Section 13.04.030) within the City limits.

B. Findings. The City Council of the City of Vacaville finds that the development of cable systems has the potential of having great benefit and impact upon the residents of the City of Vacaville. Because of the complex and rapidly changing technology associated with cable systems, the City Council of the City of Vacaville further finds that the public convenience, safety and general welfare can best be served by establishing regulatory powers which should be vested in the City of Vacaville or such “persons” (as defined in Section 13.04.030) as the City of Vacaville may designate. It is the intent of this chapter and subsequent amendments to provide for and specify the means to attain the best possible “cable service” (as defined in Section 13.04.030) for the public and any “franchises” (as defined in Section 13.04.030) issued pursuant to this chapter shall be deemed to include this chapter as an integral and material part thereof. It is the further intent of this chapter to establish regulatory provisions that permit the City to regulate cable system franchises to the extent permitted by federal and state law, including but not limited to the Federal Cable Communications Policy Act of 1984, the Federal Cable Television Consumer Protection and Competition Act of 1992,

the Federal Telecommunications Act of 1996, applicable Federal Communications Commission regulations and applicable California law.

(Ord. 1770, Repealed and Replaced, 09/26/2006)

13.04.020 Short title.

This chapter shall constitute and be known as the cable system regulatory ordinance of the City of Vacaville.


13.04.030 Definitions.

For the purposes of this chapter, the following terms, phrases, words and their derivations shall have the meaning given herein. Words used in the present tense include the future, words in the plural number include the singular number, and words in the singular number include the plural number. Words not defined shall be given their common and ordinary meaning. Words not defined in this chapter shall have the same meaning as in title VI of title 47 of the United States Code in effect on the effective date of the ordinance enacting this chapter, and, if not defined therein, their common and ordinary meaning.

If specific provisions of law referred to herein are renumbered, then the reference shall be read to refer to the renumbered provision.

“Affiliate,” when used in relation to any person, means another person who owns or controls, is owned or controlled by, or is under common ownership or control with, such person.

“Basic cable service” or “basic service” means any service tier provided by the grantee as required under 47 U.S.C. Section 543(b)(7) and which includes the retransmission of local television broadcast signals.

“Cable Act” means the Cable Communications Policy Act of 1984, 47 U.S.C. Section 521 et seq., as amended by the Cable Television Consumer Protection and Competition Act of 1992, as further amended by the Telecommunications Act of 1996.

“Cable operator” means any person or group of persons who:

1. Provides cable service over a cable system and directly or through one or more affiliates owns a significant interest in such cable system; or

2. Otherwise controls or is responsible for, through any arrangement, the management and operation of such cable system.

“Cable service” means:

1. The one-way transmission to subscribers of (a) video programming; or (b) other programming service, and

2. Subscriber interaction, if any, that is required for the selection or use of such video programming or other programming service, and

3. Any other services within the definition of cable service under federal law, as it currently exists or may hereafter be amended.

“Cable system” or “system” means a facility, consisting of a set of closed transmission paths and associated signal generation, reception, and control equipment that is designed to provide cable service to multiple subscribers within a community which includes video programming but does not include:

1. A facility that serves only to retransmit television signals of one or more television broadcast stations;

2. A facility that serves subscribers without using any public right-of-way;

3. A facility of a common carrier that is subject, in whole or in part, to the provisions of Title II of the Federal Communications Act of 1934, as amended, except that such facility shall be considered a cable system (other than for the purposes of 47 U.S.C. Section 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;

4. An open video system that complies with 47 U.S.C. Section 573; or

5. Any facilities of any electric utility used solely for operating its electric utility system.

“Channel” or “cable channel” means a portion of the electromagnetic frequency spectrum that is used in a cable system and that is capable of delivering a television channel as defined by the Federal Communications Commission.

“Chapter” means the cable system regulatory ordinance codified in this chapter.

“City” means the City of Vacaville, a municipal corporation acting by and through the City Council or its designee(s).

“City Council” or “Council” means the City Council of the City of Vacaville.

“City Manager” means the City Manager of the City of Vacaville or his or her designee.

“Days” means calendar days, unless the text specifically states “working” or “business” days.

“Federal Communications Commission” or “FCC” means the present federal agency of that name as constituted by the Federal Communications Act of 1934, or any successor agency created by the United States Congress that regulates cable systems and the provision of cable services.

“Franchise” means an initial authorization, or renewal thereof, issued by the Council, which provides a grantee a nonexclusive right to construct and operate a cable system on, over, under, across, or beneath the public rights-of-way.

“Franchise agreement” means a contractual agreement, containing the specific provisions of the franchise granted for the construction, installation, maintenance, repair, upgrade and operation of a cable system.

“Franchise fee” means the fee or assessment payable to City pursuant to 47 U.S.C. Section 542, this chapter and any franchise agreement. The term “franchise fee” does not include:

1. Any tax, fee, or assessment of general applicability (including any such tax, fee, or assessment imposed on both utilities and cable operators for their services, but not including a tax, fee or assessment which is unduly discriminatory against cable operators or cable subscribers);

2. Capital costs that are required by the franchise to be incurred by the grantee for public, educational, or governmental access facilities;

3. Requirements or charges incidental to the awarding or enforcing of the franchise, including payments for bonds, security funds, letters of credit, insurance, indemnification, penalties, or liquidated damages; or

4. Any fee imposed under Title 17 of the United States Code; or

5. Any other voluntary one-time or periodic grant by a cable operator to City or such other entity designated by the City unless prior to receipt of the grant by City or a designated entity, City agrees, in writing, that the grant will be treated as part of the franchise fee and credited against such franchise fee.

“Grantee” means any person receiving a franchise pursuant to this chapter and its lawfully permitted successor, transferee or assignee.

“Grantor” means the City of Vacaville as represented by its City Council or any delegate, acting within the lawful scope of his or her authority.

“Gross revenue” means all revenue derived by the grantee from the operation of the cable system to provide cable services within the City. Gross revenues shall include, without limitation: monthly or periodic fees charged to subscribers for any cable service, including but not limited to, basic, optional, premium, per channel and/or per program service; installation and reconnection fees; equipment rental fees and equipment sales revenue; program guide revenues; upgrade, downgrade or other change-in-service fees; franchise fees, leased channel fees; and advertising and home shopping revenues. “Gross revenues” shall be construed broadly to include revenues of affiliates, partner, joint venturer or other entity, other than those already treated as revenues of the grantee, where necessary to prevent avoidance of fees owed on gross revenues.

“Gross revenues” shall not include (1) taxes on services furnished by the grantee herein, imposed directly upon any subscriber by the state, local or other governmental entity and collected by the grantee on behalf of the governmental entity and (2) revenues collected from subscribers for public, education, or government access capital grants.

With respect to advertising revenues, the grantee’s gross revenues shall include those advertising revenues derived from the operation of the grantee’s cable system to provide cable services within the franchise area. Such revenues shall be the net of commissions due to advertising agencies that arrange for the advertising buy, consistent with generally accepted accounting principles. Revenues generated from regional advertising sales extending beyond the franchise area shall be prorated from headend revenue on a per subscriber basis, so that no revenues are double counted, or attributed to more than one local governmental entity for purposes of calculating franchise fees. Gross revenues shall be computed according to generally accepted accounting principles.

“Install, construct, operate, upgrade, repair or maintain” and similar formulations of that term means the named actions interpreted broadly, encompassing, among other things, the installation, extension, maintenance, replacement of components, relocation, undergrounding, grading, site preparation, adjusting, testing, excavation and the management of the cable system and its operations.

“Installation” means the connection of the cable system to subscribers’ terminals, and the initial provision of cable service.

“Institutional network” or “I-net” means a cable communications network designed for public, educational, or governmental agencies or services for use in connection with the ongoing operations of such institutions.

“License” or “permit” means any and all licenses, permits, encroachment permits, right of entry agreements, business licenses and any and all other approvals required to perform work in the public rights-of-way or in the City of Vacaville.

“Person” means an individual, partnership, organization, association, joint stock company, trust, corporation or governmental entity.

“Public, educational or government access” or “PEG access” means the following:

1. Channel capacity designated for noncommercial public, educational, or government use; and

2. Facilities and equipment for the use of such channel capacity.

“Section” means any section, subsection or provision of this chapter.

“Service area” or “franchise area” means the entire geographic area within the municipal boundaries of the City as it is now constituted or may in the future be constituted, unless otherwise specified in the franchise or franchise agreement.

“Service tier” means a category of cable service or other services provided by a cable operator and for which a separate rate is charged by the cable operator.

“Standard cable service” means the basic service tier and expanded basic cable service tier.

“State” means the state of California.

“Street” or “public way” or “public rights-of-way” means any of the following that have been dedicated to the public or are hereafter dedicated to the public and maintained under public authority or by others and located within the service area: streets, roadways, highways, avenues, lanes, alleys, drives, courts, sidewalks, paths, easements, rights-of-way and similar public property, and includes the surface, space above and space below any of the same.

“Subscriber” or “customer” or “consumer” means any person or entity legally receiving for any purpose the cable service of the grantee, in accordance with the grantee’s terms and conditions.


13.04.040 Franchise terms and conditions.

A. Franchise Purposes. A franchise granted by the City under the provisions of this chapter shall encompass the following purposes:

1. To permit the grantee to engage in the business of providing cable service, and such other services as may be permitted by law that the grantee provides to subscribers within the service area; and

2. To permit the grantee to erect, install, construct, repair, rebuild, reconstruct, replace, upgrade, maintain, and retain, cable lines, fiber lines, related electronic equipment, supporting structures, appurtenances, and other facilities in connection with the operation of the cable system in, on, over, under, upon, along, or across streets or other public places within the service area; and

3. To permit the grantee to maintain and operate said franchise facilities for the origination, reception, transmission, amplification, and distribution of television signals and for the delivery of cable services, and such other services as may be permitted by law; and

4. To set forth the obligations of the grantee under the franchise.

The grant of a franchise shall not eliminate or supersede any of the grantee’s obligations to obtain any and all required licenses or permits to conduct business in the City or to perform certain activities within the public rights-of-way, or any other generally applicable permits or licenses needed for purposes related to the grantee’s provision of cable services within service area.

B. Franchise Required. After the effective date of this “chapter” (as defined in Section 13.04.030), it shall be unlawful for any person to install, construct, operate, upgrade, maintain

or reconstruct a cable system in the City within any public way without a properly granted franchise awarded pursuant to the provisions of this chapter.

C. Term of the Franchise.

1. A franchise granted hereunder shall be for a term, established in the franchise agreement, subject to the provisions of the franchise agreement and Sections 13.04.050.E (Effective Date of Franchise or Renewal) and 13.04.130.O (Grantor’s Power to Revoke) of this chapter.

2. A franchise granted hereunder may be renewed upon application by the grantee pursuant to the provisions of applicable state and federal law, this chapter and the franchise agreement.

D. Franchise Territory. Any franchise shall be valid within all the municipal boundaries of the City, and within any area added or annexed to the City during the term of the franchise, unless otherwise specified in the franchise agreement.

E. Federal or State Jurisdiction and Preemption.

1. This chapter shall be construed in a manner consistent with all applicable federal and state laws, and shall apply to all franchises granted or renewed after the effective date of the ordinance codified in this chapter, to the extent permitted by applicable law.

2. In the event that the state or federal government discontinues preemption in any area of cable system regulation over which it currently exercises jurisdiction in such manner as to expand rather than limit municipal regulatory authority, City may, if it so elects, adopt rules and regulations in these areas, to the extent permitted by then applicable law.

F. Franchise Nontransferable.

1. Grantee shall not sell, transfer, lease, assign or dispose of, in whole or in part, either by forced or involuntary sale, or by ordinary sale, contract, consolidation or otherwise, the franchise or any of the rights or privileges therein granted, without the prior written consent of the Council, which consent shall not be unreasonably denied, withheld or delayed; provided, however, that the prior consent of the Council shall not be required for an intracorporate or intracompany transfer from one wholly owned subsidiary to another wholly owned subsidiary. Any attempt to sell, transfer, lease, assign or otherwise dispose of the franchise without the prior written consent of the Council shall be null and void. The granting of a security interest in any cable system assets (excluding the franchise or franchise agreement), or any mortgage or other hypothecation or by assignment of any right, title or interest in the cable system in order to secure indebtedness, shall not be considered a transfer for the purposes of this section.

2. The requirements of subsection F.(1) of this section shall apply to any change in control of the grantee. The word “control” as used herein includes majority ownership, and actual working control in whatever manner exercised. In the event that the grantee is a corporation, prior written consent of the Council shall be required where ownership or control of more than 50 percent of the voting stock of the grantee is acquired by a person or group of

http://www.codepublishing.com/CA/Vacaville/Vacaville13/Vacaville1304.html#13.04.050

persons acting in concert, none of whom own or control the voting stock of the grantee as of the effective date of the franchise, singularly or collectively.

3. The grantee shall notify the grantor in writing, of any foreclosure or any other judicial sale of all or a substantial part of the franchise property of the grantee or upon the termination of any lease or interest covering all or a substantial part of said franchise property. Such written notification shall be considered by the grantor as notice that a change in control of the franchise has taken or is anticipated to take place and the provisions under this section governing the consent of grantor to such change in control of ownership shall apply.

4. For the purpose of determining whether it shall consent to such sale, transfer, lease, assignment, disposition or change in control, the grantor may inquire into the qualifications of the prospective transferee or controlling party, and the grantee shall assist and cooperate with the grantor in such inquiry. In seeking the grantor’s consent to any such sale, transfer, lease, assignment, disposition, or change in control, the grantee shall have the responsibility of ensuring that the grantee and/or the proposed transferee complete an application in accordance with the FCC Form 394 or equivalent. The grantor may require the grantee to submit such additional information as the grantor may reasonably require to determine that the proposed transferee possesses the legal, technical and financial qualifications, or that the grantee is in compliance with all franchise requirements. An application shall be submitted to the grantor not less than 120 days prior to the proposed date of transfer. If the legal, technical and financial qualifications of the applicant are determined by the grantor to be satisfactory, and if the grantor determines that the grantee is in substantial compliance with all franchise requirements, the grantor shall consent to such transfer. If the grantor has not taken action on the grantee’s request for transfer within 120 days after receiving FCC Form 394 or equivalent from the grantee, the grantor’s consent to such transfer shall be deemed given. The consent of the grantor to such transfer shall not be unreasonably denied or delayed. The grantor does not waive any lawful authority it may have to impose conditions on such transfer.

5. Upon transfer, the grantee shall reimburse the grantor for the grantor’s reasonable processing and review expenses in connection with the transfer of the franchise, including, without limitation, costs of administrative review, financial, legal and technical evaluation of the proposed transferee, consultants (including technical and legal experts and all costs incurred by such experts), notice and publication costs and document preparation expenses, to the extent consistent with and allowed by applicable law. Any such reimbursement shall not be credited against any franchise fee due to the grantor during the term of the franchise.

G. Geographical Coverage.

1. The grantee shall design, construct and maintain the cable system to have the capability to pass every residential dwelling unit in the service area where the minimum density is at least 45 dwelling units per mile in underground areas and 30 dwelling units per mile in aerial areas. Subject to the density requirement, the grantee shall offer cable service to all new homes or previously unserved homes within the service area line extension requirements of the franchise agreement.

2. After service has been established by activating trunk and/or distribution cables, or by any other similar means, within the service area, the grantee shall provide service to any

requesting subscriber within the service area within 30 days from the date of request; provided, that the grantee is able to secure all rights-of-way necessary to extend service to such subscriber within such 30 day period on reasonable terms and conditions.

H. Nonexclusive Franchise and Multiple Franchises.

1. Any franchise granted pursuant to this chapter shall be nonexclusive. The grantor specifically reserves the right to grant, at any time such additional franchises for a cable system as it deems appropriate, subject to applicable local, state and federal law; provided, that if the grantor grants an additional franchise, then the material provisions of any such additional franchise shall be reasonably comparable to the terms and conditions contained in the initial grantee’s franchise, so that all grantees are accorded competitively neutral and nondiscriminatory treatment.

The grantor may limit the number of franchises granted, based upon, but not necessarily limited to, the requirements of applicable law and specific local considerations, such as:

a. The capacity of the public rights-of-way to accommodate multiple cables or fiber lines in addition to the cables, conduits and pipes of utility service providers such as electrical power, telephone, gas and water and sewer; and/or

b. The benefits that may accrue to subscribers as a result of cable system competition, such as lower rates and improved service; and/or

c. The disadvantages that may result from cable system competition, such as the requirement for multiple pedestals on residents’ property, and the disruption arising from numerous excavations of the public rights-of-way.

2. Where electric and telephone utilities are to be placed underground in any new residential housing development, the grantor shall require the developer of such new residential housing development to give each grantee serving the franchise area within which the new residential housing development is located at least 10 working days’ prior written notice of the date on which open trenching will be available for the grantee’s installation of conduit, pedestals and vaults. On request of the grantor or developer, the grantee shall promptly provide the specifications needed for such trenching.

3. The grantor may require that any grantee be responsible for its own underground trenching and the costs associated therewith, if the public rights-of-way in any particular area cannot feasibly and reasonably accommodate additional cables, according to grantor’s generally applicable practices.

I. Franchise Modification. The grantee may be required to pay any costs incurred by the grantor in processing a grantee request for franchise modification, lease, hypothecation or trust of franchise, to the extent consistent with and allowed by applicable law. Such costs may include, but are not limited to, the costs incurred for hiring consultants to assist in evaluating the request. Such costs shall be paid by the grantee within 30 calendar days of the date of the invoice issued by the grantor. Such costs shall be paid by the grantee prior to the grantor’s final consideration of the request.


13.04.050 Initial franchise applications and renewal.

A. Filing of Initial Applications.

1. Any person desiring an initial franchise for a cable system shall file a written application with the City Clerk of the City. A reasonable non-refundable application fee established by the City shall accompany the franchise application to cover all validly documented, reasonable costs associated with processing and reviewing the application, including, without limitation, costs of administrative review, financial, legal and technical evaluation of the applicant, legal, technical or other consultants, notice and publication requirements with respect to the consideration of the application, and document preparation expenses. In the event such reasonable costs exceed the application fee, the applicant shall pay the difference to the City within 30 days following receipt of an itemized statement of such costs from the City.

2. In the event such application fee exceeds the reasonable costs incurred by City, City shall refund the overage.

B. Initial Applications – Contents. An application for a cable system franchise shall contain, where applicable:

1. The name, address and telephone number of the applicant;

2. A statement as to the proposed franchise and service area;

3. A resume of prior history of the applicant, including the expertise of applicant in the cable system field;

4. A detailed statement of the corporate or other business organization of the applicant including, but not limited to, the following:

a. A list including the names, residence and business addresses of all of the partners, general and limited, of the applicant, if a partnership, or the percentage of stock owned or controlled by each stockholder, if a corporation;

b. A list including the names, residence and business addresses of all of the officers, directors and managing employees of the applicant, together with a description of the background of each such person;

c. The names and addresses of any parent or subsidiary of the applicant or any other business entity owning or controlling the applicant in whole or in part, or owned or controlled in whole or in part by the applicant;

5. A current detailed financial statement of the applicant verified by a certified public accountant audit of its accuracy or otherwise certified to be true, complete and correct to the reasonable satisfaction of the City;

6. A statement detailing, by place and date, any and all cable franchises awarded the applicant, or its parent or subsidiaries, the status of said franchises with respect to completion thereof, the total cost of said cable systems and the amount of applicant’s and its parent’s or subsidiaries’ resources committed toward completion thereof;

7. A detailed statement describing the operational and performance standards proposed by applicant. In no event shall operational and performance standards be less than those adopted by the rules and regulations of the FCC as augmented herein;

8. A detailed statement or schedule setting forth all proposed classifications of rates and charges to be made against subscribers and all rates and charges as to each of said classifications including but not limited to installation and service charges;

9. A proposed construction and service schedule; and

10. Any relevant additional or supplementary information that the City deems appropriate. The City may require such additional or supplementary information at any time. The applicant shall respond to any request for additional or supplementary information within the time frame set by the City.

C. Consideration of Initial Applications.

1. Upon receipt of any application for a franchise the City Manager shall prepare a report and make recommendations respecting such application to the Council.

2. A public hearing shall be held prior to the granting of any franchise. Within 60 days after the close of the hearing, the Council shall make a decision based upon the evidence received at the hearing 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, in its sole discretion, decline to grant any franchise.

D. Franchise Renewal.

1. Franchise renewals shall be considered in accordance with applicable law. Grantor and grantee, by mutual consent, may enter into renewal negotiations at any time during the term of the franchise; however, at a minimum, the grantee must comply with the renewal procedures, if any, set forth in the Cable Act.

2. Grantor may require an applicant for renewal to submit the same or any portion of the information required to be submitted by a new applicant, as the grantor deems reasonably necessary. The grantor may require the renewal applicant to submit to the City Clerk of the City a nonrefundable application fee as may be consistent with applicable law, and as set forth in subsection A of this section.

E. Effective Date of Franchise or Renewal. No franchise or franchise renewal granted pursuant to this chapter shall become effective for any purposes unless and until the grantee provides written acceptance thereof, together with the required proof of insurance, security fund deposits, and any other items set forth in the franchise agreement, to the City Clerk of the City. Written acceptance shall be in the form approved by the City Attorney and shall also

operate as an acceptance of each and every term, condition and limitation in this chapter and the franchise agreement.

F. Grant of Franchise. This chapter itself grants no authority to operate a cable system to any specific person. Such grants may be made only by the adoption of a separate ordinance or resolution awarding a specific franchise to an applicant pursuant to the provisions of this chapter and other applicable federal, state and local laws.


13.04.060 Minimum consumer protection and service standards.

A. Operational Standards. Each cable system operator must satisfy all federal, FCC and state customer service standards or consumer protection standards, and consumer privacy standards, as well as the provisions of this chapter and any applicable customer service standards set forth in the franchise agreement. In the case of a conflict between standards, the stricter standard shall apply.

In addition to the federal customer service standards related to the provision of cable service, and without limitation, any grantee shall maintain the necessary facilities, equipment and personnel to comply with the following consumer protection and customer service standards under normal conditions of operation:

1. Convenient locations in City for bill payments and a process for equipment exchanges that includes at least one option that is at no cost to the customer. The location shall be open for bill payments and equipment exchanges (if necessary) Monday through Saturday in compliance with federal law and during such hours as may be determined to reasonably meet customer needs;

2. An emergency system maintenance and repair staff, capable of responding to and repairing major system malfunctions on a 24 hour per day basis;

3. An installation staff, capable of providing cable service to any subscriber requiring a standard installation within seven days after receipt of such request, in all areas where trunk and feeder cable are present and have been activated. “Standard installations” shall be those that are located up to 125 feet from the existing distribution system, unless otherwise defined in the franchise agreement.

B. Minimum Service Standards.

1. Grantee shall render efficient service, make repairs promptly, and interrupt cable service only for good cause and for the shortest time possible. Scheduled interruptions of an anticipated duration of two consecutive hours or longer, insofar as possible, shall be preceded by notice to affected subscribers and the City and shall occur during a period of minimum use of the cable system, preferably between midnight and six a.m. local time.

2. The grantee shall maintain an adequate number of service technicians normally capable of responding to subscriber requests for service within the following time frames:

a. For a service interruption: Within 24 hours, including weekends, of receiving a subscriber call or request for service involving an interruption of sound or picture of one or more channels. If the outage occurs on a weekend and affects less than three subscribers, a service technician shall respond no later than the next business day.

b. For an isolated outage: Within one business day, including weekends, of receiving requests for service involving an isolated outage of sound or picture for one or more channels.

c. For inferior signal quality: Within two business days of receiving a request for service involving a picture or sound quality problem.

3. If the service problem requires a visit to a subscriber’s residence, the response shall be deemed to have occurred when a technician arrives at the service location and begins work on the problem. If the subscriber is not present when the technician arrives, the technician shall leave written notification of attempted service.

4. Grantee shall not charge for the repair or replacement of defective or malfunctioning equipment provided by the grantee to subscribers, unless the repair or replacement is due to the subscriber’s action or conduct.

5. Unless otherwise provided hereunder, the grantee shall determine the nature of the problem within two business days of beginning work and shall remedy the problem within five business days unless a remedy is technically infeasible.

6. In cases where a remedy is technically infeasible, within five business days of making such determination, the grantee shall provide the subscriber an explanation as to why the problem cannot be repaired.

7. Grantee shall develop, effectuate, and maintain a comprehensive routine preventative maintenance program for the cable system to ensure continued top quality cable service.

C. Billing and Information Standards.

1. Subscriber bills shall be clear, concise and understandable. Bills shall be fully itemized, with itemized charges for all services provided including, but not limited to, basic and premium service charges and equipment charges. Bills shall also clearly delineate all activity during the billing period, including optional charges, rebates and credits.

2. Grantee may, at its discretion, provide low income discounts to qualified residential subscribers. For purposes of this section the term “low income” means households whose median income is 80 percent or less of the area median income for the Napa/Solana area as determined by the Federal Department of Housing and Urban Development (HUD) on an annual basis.

3. If a subscriber disputes a bill, the grantee shall respond to the subscriber within 30 days.

4. Upon request, the grantee shall provide credits to subscribers whose cable service has been interrupted where the interruptions are not the fault of the affected subscriber(s). The minimum credit or refund given pursuant to this section shall be equal to one day’s charge for cable service for the affected subscriber. In the event the grantee improperly or inadvertently disconnects cable service to a subscriber, the grantee shall restore the cable service without charge to subscriber within 24 hours of notification by subscriber of such disconnection. The grantee shall credit or provide refunds to any subscriber whose cable service is improperly or inadvertently disconnected for the period of time the subscriber is without cable service. All credits or refunds for service shall be given no later than the subscriber’s next billing cycle following the determination that a credit or refund is due to the subscriber, or, if the subscriber terminates cable service no later than 30 days after the subscriber returns any grantee-supplied equipment.

5. Grantee shall provide to subscribers the written information set forth below at the following times: (i) at the time of installation of cable service; (ii) at least annually to all subscribers; and (iii) at any time requested by subscriber.

a. Cable services offered;

b. Prices and options for programming services and conditions of subscription to programming and other cable services;

c. Installation and service maintenance policies;

d. Instructions on how to use the cable service;

e. Channel positions of programming carried on the system; and

f. Billing and complaint procedures, including the address and telephone number of the grantee’s office designated for dealing with cable-related issues.

6. Grantee shall notify all subscribers of any changes in rates, programming services or channel positions as soon as possible in writing and in accordance with state and federal law. Notice shall be given not less than 30 days in advance of such changes if the change is within the grantee’s control. In addition, the grantee shall provide not less than 30 days’ prior written notice of any material changes in the information specified in subsection C.(5) of this section.

D. Verification of Compliance with Standards.

1. The grantee shall respond to the grantor’s request for information regarding the grantee’s compliance with any or all of the standards required in subsections A, B and C of this section within 30 days of such request. The grantee’s response shall include sufficient documentation to permit the grantor to verify the grantee’s compliance for the previous 12-month period. The grantee may request, and the grantor shall not unreasonably deny, a request for a reasonable extension of time in which to produce such documentation.

2. A repeated and verifiable pattern of non-compliance with the consumer protection standards of subsections A, B and C of this section, after the grantee’s receipt of notice and a

reasonable opportunity to cure, shall be deemed a material breach of the franchise agreement.

3. Should the grantor determine that insufficient telephone line capacity or inadequate staffing exists, the grantee shall take necessary steps to ensure that adequate telephone line capacity and/or staffing are available to permit the grantee to satisfy its obligations under this chapter and the franchise agreement. Consideration shall be given for periods of promotional activities or outages. The monthly billing period shall be considered as a normal period over which to evaluate daily activity for purposes of determining the adequacy of telephone line capacity and/or staffing.

E. Subscriber Complaints and Disputes.

1. Grantee shall establish written procedures for receiving, acting upon and resolving subscriber complaints without intervention by the grantor. The written procedures shall prescribe the manner in which a subscriber may submit a complaint either orally or in writing to the grantee specifying the subscriber’s grounds for dissatisfaction. Upon request, the grantee shall file a copy of these procedures with the grantor. The written procedures shall include a requirement that the grantee respond, in writing, to any written complaint from a subscriber within five business days of receipt of the complaint. Grantee’s response to subscriber complaints, as well as complaints made by subscribers to the grantor and forwarded to the grantee for handling, shall be initiated within five business days of receipt by the grantee. Grantee’s satisfactory resolution of subscriber complaints shall be completed not later than 10 business days after receipt of the complaint. Should a grantee supervisor not be available when requested by a subscriber, a supervisor shall respond to the subscriber’s complaint at the earliest possible time, and in no event later than the end of the next business day. For complaints received by the grantor and forwarded to the grantee, the grantee shall notify the grantor of the grantee’s progress in responding to, and resolving, said complaints.

2. Upon prior written request, the grantor shall have the right to review the grantee’s response to any subscriber complaints in order to determine the grantee’s compliance with the franchise requirements, subject to the subscriber’s right to privacy.

3. Subject to applicable law, it shall be the right of all subscribers to continue receiving cable service insofar as their financial and other obligations to the grantee are honored. In the event that the grantee elects to rebuild, modify, or sell the system, or the grantor gives notice of intent to terminate or not to renew the franchise, the grantee shall act so as to ensure that all subscribers receive cable service so long as the franchise remains in force.

4. In the event of a change of control of the grantee, or in the event a new cable operator acquires the system, the original grantee shall cooperate with the grantor and the new cable operator in maintaining continuity of cable service to all subscribers. During such transition period, the grantee shall be entitled to the revenues for any period during which it operates the system, subject to the grantor’s right to the franchise fee.

F. Disconnection/Downgrades.

1. A subscriber may terminate or downgrade service at any time, and the grantee must promptly comply with the subscriber’s request within five days or at the 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 the grantee.

2. The grantee may disconnect a subscriber’s service if the subscriber fails to pay a monthly fee or charge, but such disconnection must not occur prior to 45 days after the fee or charge is due plus 10 days’ prior written notice to the subscriber of the grantee’s intent to disconnect service. In the event that the subscriber pays all past due amounts, including late charges, before the scheduled disconnection date, the grantee may not disconnect service. In the event that service is disconnected for nonpayment of past due fees or charges, the grantee must promptly reinstate service upon payment by the subscriber in full of all such fees and charges, including late charges, reconnection charges and/or security deposits.

3. Notwithstanding the requirements of subsection F.(2) of this section, the grantee may immediately disconnect service to a subscriber if the subscriber is damaging or destroying the grantee’s cable system or equipment. In the event of disconnection on such grounds, the grantee will resume service to the subscriber upon receiving adequate assurances that the subscriber has ceased the practices or conduct that resulted in disconnection and has paid all proper fees and charges, including any amounts reasonably owed the grantee for the damage caused by the subscriber.

4. The grantee also may disconnect service to a subscriber that is causing signal leakage exceeding federal limits. In the event that service is disconnected, the grantee will immediately resume service without charge upon the satisfactory correction of the signal leakage problem.

5. 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.

G. Changes in Service. Except as otherwise provided by federal law, subscribers must not be required to pay any additional fee or charge, other than the regular service fee, in order to receive the services selected (such as upgrade or downgrade charges). No charge may be imposed for any service or product that the subscriber has not affirmatively selected. Payment of the regular monthly bill will not by itself constitute an affirmative selection.

H. Broad Categories of Cable Services.

1. Grantee must provide, at a minimum, the following broad categories of programming: local broadcast stations to the extent available to the grantee; news; cultural programming; classic and contemporary movies; foreign and special interest films; general entertainment; sports programming; documentary programming; children’s programming; and foreign language programming.

2. If any broad category of programming listed in subsection H.(1) of this section becomes unavailable, or cannot be provided by the grantee under existing FCC regulations, then the grantee must provide, to the extent feasible, reasonably comparable programming.

I. Other Requirements.

1. At all times, the grantee’s employees shall maintain a high standard of courtesy in customer relations.

2. In the event the grantee fails to operate the cable system for seven consecutive days other than for reasons beyond the reasonable control of the grantee and without the prior written approval or subsequent excuse of the grantor, the grantor may, at its sole option, and without limiting its other remedies, operate the cable system or designate an operator until such time as the grantee restores service under conditions acceptable to the grantor. If the grantor should fulfill this obligation for the grantee, then during such period as the grantor fulfills such obligation, the grantor shall be entitled to collect all revenues from operation of the cable system (or, at the grantor’s sole discretion, the grantor may require the grantee to collect), and the grantee shall reimburse the grantor for all reasonable costs or damages in excess of the revenues collected by the grantor that are the result of the grantee’s failure to perform.

3. All officers, agents or employees of the grantee or 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 shall carry a photo-identification card. The grantee shall account for all identification cards at all times. Every vehicle of the grantee or its major subcontractors shall be clearly marked or identified as working for the grantee.

4. Additional customer service standards and standards governing consumer protection and the grantee’s response to subscriber complaints not otherwise provided for in this chapter may be established in the franchise agreement. A verified and continuing pattern of noncompliance shall be deemed a material breach of the franchise; provided, that the grantee is provided prior written notification and a reasonable opportunity to cure such breach, prior to the grantor’s final determination that a breach has occurred.


13.04.070 Franchise fee and financial requirements.

A. Franchise Fee.

1. Following the issuance and acceptance of the franchise, and in consideration of the rights granted the grantee, the grantee shall pay to the grantor a franchise fee on annual gross revenues at the times set forth in the franchise agreement. Each franchise fee payment shall be accompanied by a certified report from a representative of the grantee, which shows the basis for the computation of all gross revenues during the period for which such franchise fee payment is made.

2. The fee shall be in an amount equal to five percent of annual gross revenue. If the franchise fee is not paid in the manner provided in the agreement, the grantee shall also pay a late fee to the grantor in the amount of one and one-half percent per month on the outstanding unpaid balance until paid in full.

3. In the event the grantee overpays its franchise fee, the grantee shall notify the grantor in writing, and provide sufficient documentation to verify the alleged overpayment. If the grantor concurs that an overpayment has been made, the grantor shall provide written authorization to the grantee to deduct the overpaid amount in installments over a period of time mutually acceptable to the parties beginning with the next franchise fee payment due from the grantee to the grantor, and subsequent franchise fee payments until the overpaid amount is fully reimbursed to the grantee.

4. The grantee shall file with the grantor within 90 days after the expiration of the grantee’s fiscal year an audited financial statement prepared by a certified public accountant or an officer of the grantee, certifying under penalty of perjury, and in a form reasonably satisfactory to the grantor’s financial officer, showing in detail the gross revenues of the grantee during the preceding fiscal year. The statement shall be prepared in accordance with generally accepted accounting principles. The grantee shall pay to the grantor, within 30 days after the time for filing such statements, the sum prescribed or any unpaid balance thereof for the period of time covered by such statement. In the event the grantee overpaid the grantor, the grantee may deduct such amount from the next franchise fee payment due the grantor until such time as the overpayment has been recovered.

5. No acceptance of any payment by the grantor shall be construed as a release or as an accord and satisfaction of any claim the grantor may have for further or additional sums payable as a franchise fee under this chapter or the franchise agreement or for the performance of any other obligation of the grantee.

B. Franchise Fee Audit. Upon thirty (30) days’ prior written notice, the grantor shall have the right to conduct an independent financial audit of the grantee’s gross revenues and franchise fee records, in accordance with generally accepted accounting procedures (GAAP), and if the results of any such audit indicates a franchise fee underpayment of five percent or more during the audit period, the grantee shall reimburse the grantor for all reasonable documented costs of such audit, up to a maximum amount of seven thousand five hundred dollars.

C. Security Fund.

1. The grantor may require the grantee to provide a security fund, in an amount and form established in the franchise agreement. The amount of the security fund shall be established based on the extent of the grantee’s obligations under the terms of the franchise.

2. The security fund shall be available to the grantor to satisfy all claims, liens, payments and/or taxes due the grantor from the grantee that arise by reason of installation, construction, operation, upgrade, repair, maintenance or reconstruction of the system, and to satisfy any actual or liquidated damages arising out of a material breach of the franchise agreement or this chapter, subject to the procedures and amounts specified in the franchise agreement and this chapter.

3. If the security fund is drawn upon by the grantor in accordance with the procedures established in the franchise agreement and this chapter, grantee shall cause the security fund to be replenished to the original amount no later than 30 days after receiving written confirmation from the bank where such security fund is deposited that the grantor has made a

draw against the security fund. Failure to replenish the security fund within such time limit shall be deemed a material breach of the franchise.


13.04.080 Construction requirements.

A. System Construction.

1. The grantee shall not construct, install, upgrade, maintain or repair any cable system facilities or perform any other work in the public rights-of-way, until the grantee has secured the necessary licenses and permits from the grantor, and other responsible public agencies. The grantee shall be subject to all permitting, bonding, indemnity and insurance requirements applicable to contractors working within the public rights-of-way. No provision of this chapter or the franchise agreement shall be deemed a waiver of the obligation of a grantee to pay the grantor for the issuance of any licenses or permits. The grantor’s ministerial approval of any licenses or permits shall not be unreasonably withheld or delayed. Additionally, if emergency work on the system in the public right-of-way is required, the grantee shall with all due diligence seek to obtain any and all such required licenses and permits within three working days after commencing such emergency work.

2. In those areas of the City where transmission lines or distribution facilities of the public utilities providing telephone and electric power service are underground, the grantee likewise shall construct, operate and maintain its transmission and distribution facilities underground, to the extent technologically feasible.

3. In those areas of the City where the grantee’s cables are located on aboveground transmission or distribution facilities of the public and/or municipal utility providing telephone or electric power service, and in the event that the facilities of all the aboveground utilities subsequently are placed underground, then the grantee likewise at such time shall reconstruct, install, operate, repair, and maintain its transmission and distribution facilities underground, at the grantee’s sole cost. Certain of the grantee’s existing equipment, such as pedestals, amplifiers and power supplies, which normally are placed above ground, may continue to remain in above-ground enclosures, unless otherwise provided in the franchise agreement. Grantee shall be afforded similar treatment as the electric and telephone utilities in the case that any underground district is established to reimburse the costs of those utilities required to underground facilities.

4. Any changes in or extensions of any poles, anchors, wires, cables, conduits, vaults, laterals or other fixtures and equipment (herein referred to as “structures”), or the construction of any additional structures, in, upon, along, across, under or over the streets, alleys and public rights-of-way shall be made under the direction of the grantor’s City Manager or his or her designee, who shall, if the proposed change, extension or construction conforms to the provisions hereof and all other regulations, rules, laws and ordinances of all responsible public agencies, issue written permits therefor within thirty (30) days of receiving a complete permit application. The height above public thoroughfares of all aerial wires and other structures shall conform to the requirements of the California regulatory body having jurisdiction thereof.

5. All transmission and distribution structures, lines, equipment and other structures erected by the grantee shall be located so as not to interfere with the proper use of the public rights-of-way, and to cause minimum interference with the rights or reasonable convenience of property owners who adjoin any of the public rights-of-way, and not to materially interfere with existing public and municipal utility installations.

6. Upon issuance of a written finding by the grantor that any property or improvement of the grantor in the public rights-of-way is disturbed or damaged by the grantee or any of its contractors, agents or employees in connection with undertaking any and all work pursuant to the right granted to the grantee under this chapter and the franchise agreement, the grantee shall promptly, at the grantee’s sole cost and expense, restore as nearly as practicable to at least its former condition and to the grantor’s reasonable satisfaction the property or improvement which was so disturbed or damaged. If such property or improvement becomes uneven, unsettled or otherwise requires additional restorative work, repair or replacement because of the initial disturbance or damage or subsequent repair to the property by the grantee, then the grantee, as soon as reasonably possible, shall, promptly upon receipt of written notice from the grantor and at the grantee’s sole cost and expense, restore as nearly as practicable to at least its former condition and to the grantor’s reasonable satisfaction the property or improvement which was disturbed, damaged or improperly repaired. Any such restoration by the grantee shall be made in accordance with such materials and specifications as may, from time to time, be established by the grantor.

7. Prior to commencing any work on the system in the public rights-of-way, the grantee shall obtain any and all licenses and permits lawfully required for such work.

8. There shall be no unreasonable or unnecessary obstruction of the public rights-of-way by the grantee in connection with any of the work provided for herein. The grantee shall maintain any barriers, signs and warning signals during any work performed on or about the public rights-of-way or adjacent thereto as may be necessary to reasonably avoid injury or damage to life and property.

9. If the grantor lawfully elects to alter or change the grade, width or location of any public right-of-way, the grantee shall, upon reasonable notice by the grantor, and in a timely manner, remove, relay and relocate its poles, wires, cables, underground conduits, manholes and other fixtures and structures at its own expense.

10. The grantee shall not place poles, conduits or other fixtures and structures above or below ground where the same will interfere with any gas, electric, telephone fixtures, water hydrants or other utilities, and all such poles, conduits or other fixtures and structures placed in any street shall be so placed as to comply with all ordinances, rules and regulations of the grantor and other responsible public agencies.

11. In accordance with all applicable laws, rules and regulations, the grantee or any utility user of the public rights-of-way may be required by the grantor to permit joint use of their poles and/or conduit located in the public rights-of-way, by any authorized user insofar as such joint use may be reasonably practicable and upon payment of a reasonable rental fee for such usage. In the absence of any written or verbal agreement regarding such joint use, each party shall be entitled to exercise any rights and defenses provided by applicable law.

12. The grantee, on request of any person holding a building moving permit issued by the grantor, shall temporarily raise or lower its wires, fixtures or structures to permit the moving of buildings. The expense of such temporary raising or lowering of wires, fixtures or structures shall be paid by the person requesting the same, and the grantee shall have the authority to require such payment in advance. Such person shall provide the grantee not less than 10 business days’ prior written notice to arrange for the temporary raising or lowering of grantee’s wire, fixtures or structures.

13. Subject to the acquisition of any required licenses and permits, the grantee shall have the authority to trim any trees or other natural vegetation overhanging the public rights-of-way so as to prevent the branches of such trees or other natural vegetation from coming in contact with the grantee’s wires, cables and other equipment.

14. Grantee shall be subject to any and all generally applicable requirements established by the grantor with regard to the location, either above ground or underground, as well as screening of the grantee’s facilities, equipment, and structures located in, above or about the public rights-of-way. Such requirements may include, but are not limited to, use of landscaping to screen pedestals and cabinets and requiring that construction be flush with the natural grade of the surrounding area.

15. Within 90 days of completion of any and all work in the public rights-of-way, including, but not limited to, initial installations and upgrades of the cable system, the grantee shall submit updated strand maps to the grantor.

B. Multiple Franchises.

1. Subject to all applicable laws, rules and regulations, in the event that the grantor grants more than one franchise, the grantor reserves the right to limit the number of unused drop cables to a residential structure.

2. The grantor reserves the right to grant a temporary encroachment permit to a franchise applicant to install conduit and/or cable in anticipation of the granting of a franchise. Such installations shall be at the applicant’s risk, with no recourse against the grantor in the event the franchise application is not granted. The grantor may, at its sole discretion, require an applicant to provide a separate trench for its conduit and/or cable, at the applicant’s cost.

3. If the grantor authorizes or permits another cable system to operate within the municipal limits of the City, it shall do so on conditions that such new franchise holder shall indemnify and hold harmless previous grantees from and against all reasonable and documented costs and expenses incurred to accommodate the new system (e.g., strengthening poles, replacing poles, rearranging attachments, placing underground facilities, inspection costs, etc.) within the franchise area. For the purpose of this subsection, the previous grantees shall be designated third party beneficiaries of such conditions as are incorporated into the authorization(s) granted to the new franchise holder.


13.04.090 Technical standards.

A. Applicable Technical Standards.

1. The grantee shall install, construct, operate, upgrade, repair, maintain and reconstruct its cable system in a manner consistent with all applicable laws, ordinances, rules, regulations, construction standards, governmental requirements of all responsible public agencies, FCC technical standards (FCC regulations, Part 76, Subpart K, as amended from time to time) and any detailed standards set forth in the franchise agreement. In addition, the grantee shall provide to the grantor, upon written request, a written report of the results of the grantee’s periodic proof of performance tests conducted pursuant to FCC and franchise requirements, rules, regulations, standards and guidelines.

2. Should the FCC no longer require proof of performance tests, the grantee shall make and submit such equivalent proof of performance tests and reports in response to a written request from the grantor. Such report shall be submitted to the grantor within 60 days of issuance of the grantor request.

3. Repeated and verified failure to maintain specified technical standards shall constitute a material breach of the franchise.

B. Costs of Technical Assistance. If agreed to in the franchise agreement, the grantee shall pay all reasonable costs actually incurred by the grantor for obtaining any technical assistance deemed necessary by the grantor for independent verification of technical compliance with any and all applicable technical standards. The grantee, however, shall not be obligated to pay for such technical review more frequently than once every 36 months.


13.04.100 Indemnification and insurance requirements.

Grantee shall comply with all indemnity, hold harmless and insurance provisions set forth in the franchise agreement or any other grant of franchise.


13.04.110 Records and reports.

A. Records Required.

1. Grantee shall at all times maintain:

a. A written or computer-stored record of a subscriber’s service calls and interruptions or degradation of service experienced for the preceding two years; provided, that such complaints result in or require a service call, maintained in the ordinary course of business, and the disclosure thereof does not violate the subscriber’s right of privacy. Such records may be maintained on an aggregate basis for the service area, consistent with the grantee’s regular business practice.

b. A full and complete set of record drawings showing the locations of the cable system installed or in use in the City, exclusive of subscriber service drops and equipment provided in subscribers’ homes.

c. A monthly summary of service calls, identifying the number, general nature and disposition of such calls. If requested by the grantor, the monthly summary shall be submitted in writing to the grantor within 30 days following any written request by the grantor, in a form reasonably acceptable to the grantor.

d. A written complaint record of those complaints received by the grantor and referred to the grantee for resolution, which shall contain a semiannual (January 1st through June 30th and July 1st through December 31st) breakdown indicating the total number of escalated complaints received for the preceding reporting period, classified into the following categories: construction, service and equipment billing, customer relations/service and miscellaneous.

e. A full and complete written record of rates for cable services, such as programming services, equipment, installations and other subscriber charges. This information shall include, but not be limited to, rates for the basic service tier, tiers of service beyond the basic tier, premium service, pay-per-view services, late fees, additional outlets, converters, remote controls and any charges for installation or service at the subscriber premises.

2. The grantor may request additional non-confidential information, records and documents from the grantee maintained in the ordinary course of business, provided the request reasonably relates to the scope of grantor’s rights under this chapter or the franchise agreement.

3. Upon reasonable written notice, and during normal business hours, the grantee shall permit examination by any duly authorized representative of the grantor of all:

a. Cable system property and facilities, together with any appurtenant property and facilities of the grantee situated within the service area; and

b. All nonconfidential records relating to the operation of the cable system, provided they are necessary to enable the grantor to carry out its regulatory responsibilities under this chapter or the franchise agreement including, but not limited to, grantee compliance with the terms and conditions of this chapter and the franchise agreement. The grantee shall have the right to be present at any such examination.

B. Annual Reports.

1. Within 90 days after the end of each calendar year, the grantee shall, upon written request made within 30 days of the close of the calendar year, submit a written report to grantor with respect to the preceding calendar year in which shall include, but not be limited to, the following information:

a. A summary of the previous year’s activities in the development, upgrade and operation of the cable system including, but not limited to, cable services commenced or discontinued during the reporting year;

b. A list of the grantee’s officers and members of its board of directors;

c. An ownership report, indicating all persons who at the time of filing control or own an interest in the franchisee of 10 percent or more;

d. Information as to:

i. The number of homes passed;

ii. Total subscribers; and

iii. The number of cable service subscribers broken into service categories.

2. Upon written request, the grantee shall submit to the grantor copies of all pleadings, applications and reports submitted by the grantee to any federal, state or local court, regulatory agency, or other governmental body as well as copies of all decisions issued in response to such pleadings, applications and reports, which could materially affect the grantee’s cable system within the franchise area.

3. Information otherwise made confidential by law and so designated by the grantee, which is submitted to the grantor, shall be retained in confidence by the grantor and its authorized agents and shall not be made available for public inspection, unless disclosure is otherwise required by law or court order. Notwithstanding the foregoing and to the extent permitted by law, the grantee shall have no obligation to provide copies of documents to the grantor which contain trade secrets of the grantee or which are otherwise of a confidential or proprietary nature to the grantee unless it receives satisfactory assurances from the grantor that such information can and will be held in strictest confidence and protected by the grantor. To the extent possible, the grantee may provide the grantor with summaries of any required documents or copies thereof with trade secrets and proprietary matters deleted therefrom. The burden of proof shall be on the grantee to establish the confidential nature of any information submitted to the reasonable satisfaction of the grantor. Additionally, the grantee agrees to defend, indemnify and hold harmless the grantor, its officers, officials, employees and agents from and against any actions, causes of action, losses, damages, claims and liability arising from or related to grantor’s failure to produce any information pursuant to this chapter, the franchise agreement or written request of the grantee to withhold such information.

4. If the grantee or its parent is publicly held, the grantee shall, upon the grantor’s written request, submit a copy of the grantee’s, or its parent’s, publicly filed annual or quarterly financial statement within 45 days of such request.

5. All reports required under this chapter or the franchise agreement, except those required by law to be kept confidential, shall be available for public inspection in the grantor’s offices during normal business hours.

6. All reports and records required to be delivered to the grantor under this chapter or the franchise agreement shall be furnished at the sole expense of the grantee, except as otherwise provided in this chapter or the franchise agreement.

7. The willful refusal, failure, or neglect of the grantee to file any of the reports required as and when due under this chapter or the franchise agreement, may be deemed a material breach of the franchise agreement if such reports are not provided to the grantor within 60 days after written request therefor, and may subject the grantee to all remedies, legal or equitable, which are available to the grantor under this chapter or the franchise agreement.

8. Any materially false or misleading statement or representation made knowingly and willfully by the grantee in any report required under this chapter or the franchise agreement may be deemed a material breach of the franchise and may subject the grantee to all remedies, legal or equitable, which are available to the grantor.

C. Record Maps. Within 60 days of a written request from the grantor, the grantee shall provide the grantor with a full and complete set of strand maps showing the locations of the cable plant installed or in use in the City, exclusive of subscriber service drops. After the initial submission of a complete set of strand maps, the grantee shall provide to the grantor updated portions of those sections of the drawings that have changed, within 60 days of the change.

D. Opinion Survey. Upon written request of the grantor, but not more than once every three years, the grantee shall conduct a subscriber satisfaction survey pertaining to quality of service, which may be transmitted to subscribers in the grantee’s invoice for cable services. The results of such survey shall be provided to the grantor on a timely basis. The cost of such survey shall be borne by the grantee.


13.04.120 Review of system performance.

A. Triennial Review.

1. Upon the grantor’s prior written notice to the grantee, the grantor and the grantee may meet publicly once every three years during the term of the franchise agreement to review system performance and quality of service. The various reports required pursuant to this chapter or the franchise agreement, results of technical performance tests, the record of subscriber complaints and the grantee’s response to those complaints, and the information acquired in any subscriber surveys, shall be utilized as the basis for review.

In addition, any subscriber may submit comments or complaints during the review meetings, either orally or in writing, for consideration. Within 30 days after the conclusion of any such review meeting, the grantor shall issue findings with respect to the cable system’s compliance with this chapter and the franchise agreement and the quality of cable service within the service area.

2. If the grantor determines that the grantee is not in compliance with the requirements of this chapter or the franchise agreement, the grantor shall provide the grantee, in the form of written findings, the specific details of such alleged noncompliance. The grantor may then direct the grantee to correct the areas of noncompliance within a reasonable period of time, which shall be not less than 10 business days, but at least 30 business days. Failure of the grantee, after due notice, to:

a. Correct the area(s) of noncompliance within the specified period; or

b. Commence compliance within such period and thereafter diligently achieve such compliance; or

c. Demonstrate that the allegations of noncompliance are incorrect;

shall be considered a material breach of the franchise, and the grantor may exercise any remedy permitted by law, this chapter or the franchise agreement.

B. Opportunity for Review. When extensive subscriber complaints have been made or there exists other evidence which, in the reasonable judgment of the grantor, casts reasonable doubt on the grantee’s compliance with reliability or quality standards of this chapter or the franchise agreement, the grantor shall have the right to compel the grantee to test, analyze and report on the performance of the cable system in order to protect the public against substandard cable service. The grantor may not compel the grantee to provide such tests, analysis or reports unless the grantor has provided the grantee with a detailed summary of the nature of the evidence relied upon by the grantor, and not less than 30 days’ prior written notice of its intention to exercise its rights under this subsection B and has provided the grantee with an opportunity to be heard prior to the grantor’s exercise of such rights. Such analysis or tests shall be made and the report shall be delivered to the grantor no later than 30 days after the grantor’s notice to the grantee and shall be made at the grantee’s sole cost. Such report shall include the following information: the nature of the complaints that precipitated the special tests, what system component was tested, the equipment used and procedures employed in testing, the results of the tests, and the method by which the complaints were resolved. Any other information relevant to the special tests also shall be recorded and included in the report to the grantor.


13.04.130 Franchise violations.

A. Remedies for Violations. If the grantee fails to perform in a timely manner any material obligation required by this chapter or the franchise agreement, following written notice from the grantor and an opportunity to cure such nonperformance in accordance with the provisions of this section and the franchise agreement, the grantor may, at its sole option, in addition to the rights granted pursuant to subsection C of this section and in addition to any other legal or equitable remedy available:

1. Cure the violation and recover the actual cost of taking such action from the security fund required by the franchise agreement if such violation is not cured within 30

calendar days after written notice to the grantee pursuant to subsection B.(1) of this section of the grantor’s intention to cure and draw upon the security fund;

2. Assess against the grantee liquidated damages in an amount set forth in the franchise agreement for any such violation(s) if such violation(s) is not cured, or if the grantee has not commenced a cure, on a schedule reasonably acceptable to the grantor, within 30 calendar days after written notice to the grantee pursuant to subsection B.(1) of this section of the grantor’s intention to assess liquidated damages. Such assessment of liquidated damages may be withdrawn from the security fund.

The grantor’s action of curing the violation(s) and/or assessing liquidated damages shall not constitute a waiver by the grantor of any other right or remedy it may have under this chapter, the franchise agreement or applicable law, including without limitation, the grantor’s right to specific performance and its right to recover from the grantee such additional damages, losses, costs and expenses, including actual attorney’s fees and expert fees, as may have been suffered or incurred by the grantor by reason of or arising out of such material breach of the franchise.

B. Procedure for Remedying Franchise Violations. Except where the provisions of this subsection are specifically altered in the franchise agreement, prior to imposing any remedy or other sanction against the grantee specified in this chapter or the franchise agreement, the grantor shall give the grantee notice and an opportunity to be heard on the matter, in accordance with the following procedures:

1. The grantor shall first notify the grantee of the alleged violation and grantor’s intent to remedy said violation(s), in writing by personal delivery or registered or certified mail, and demand correction, or evidence of nonviolation, within a reasonable time, which shall not be less than 30 days.

2. If the grantee fails to:

a. Correct the alleged violation within the time prescribed; or

b. Commence correction of the alleged violation within the time prescribed and diligently remedy such alleged violation thereafter; or

c. Provide evidence that there is no violation; or

d. Request a hearing before the City Manager on the alleged violation;

the grantee shall be deemed to be in breach of the franchise agreement and the grantor may immediately impose any applicable remedies, penalties and/or sanctions as allowed by this chapter or the franchise agreement, upon written notice to the grantee.

3. Requests for a hearing before the City Manager shall be made, in writing, prior to the expiration of the 30 day cure period. Upon receipt of such written request, the grantee shall give, by personal delivery or registered or certified mail, written notice of not less than 10 business days, of a hearing before the City Manager. The notice shall set forth in detail each of the violations alleged to have occurred.

4. At the hearing, the City Manager shall hear and consider all relevant evidence, and thereafter render his or her findings and decision.

5. If the City Manager finds that:

a. The grantee has corrected the alleged violation; or

b. The grantee has diligently commenced correction of such alleged violation and is diligently proceeding to fully remedy such alleged violation; or

c. No material violation has occurred, the proceedings shall terminate and no penalty or other sanction shall be imposed.

6. If the City Manager finds that any material violations exist and that the grantee:

a. Has not corrected the same in a satisfactory manner; or

b. Has not diligently commenced correction of such violation and is not diligently proceeding to fully remedy such violation;

then the City Manager may impose one or more of the remedies permitted by this chapter, the franchise agreement or law as the City Manager, in his or her sole discretion, deems appropriate under the circumstances.

7. The decision of the City Manager may be appealed to the City Council by written application filed by the grantee with the City Clerk within ten business days following the date of the City Manager’s written decision.

8. Upon filing of an appeal application the Council shall hold a public hearing within 30 days. If the Council finds that:

a. The grantee has corrected the alleged violation; or

b. The grantee has diligently commenced correction of such alleged violation and is diligently proceeding to fully remedy such alleged violation; or

c. No material violation has occurred, the proceedings shall terminate and no penalty or other sanction shall be imposed.

9. If the Council finds that any material violation(s) exists and that the grantee:

a. Has not corrected the same in a satisfactory manner; or

b. Has not diligently commenced correction of such violation and is not diligently proceeding to fully remedy such violation;

then the Council may impose one or more of the remedies permitted in this chapter, the franchise agreement, or law as the Council, in its sole discretion, deems appropriate under the circumstances.

10. The findings and decision of the City Council are final, subject to the grantee’s right to appeal such City Council determination to the appropriate court of law. Any legal challenge to or appeal of the City Council determination must be commenced within 30 days after the decision of the City Council, or the applicable federal or state time frame.

C. Grantor’s Power to Revoke.

1. The grantor may revoke any franchise granted pursuant to this chapter and rescind all rights and privileges associated with it in the following circumstances, each of which shall represent a default by the grantee and a material breach under the franchise:

a. If the grantee fails to perform any of its material obligations under this chapter or the franchise agreement after notice and a reasonable opportunity to cure;

b. If the grantee fails to provide or maintain in full force and effect the insurance coverage or security fund as required by this chapter or the franchise agreement;

c. If the grantee violates any order or ruling of any regulatory body having jurisdiction over the grantee regarding the franchise agreement, unless such order or ruling is being contested by the grantee in good faith in an appropriate adjudicatory or administrative proceeding;

d. If the grantee knowingly practices any material fraud, misrepresentation or deceit upon the grantor;

e. If the grantee becomes insolvent, unable or unwilling to pay its debts, or is adjudged a bankrupt.

2. After complying with the procedures set forth in subsections B.(1) through (4) of this section, the City Council may revoke the grantee’s franchise. The grantor shall cause to be served on the grantee written notice of the Council’s revocation hearing. Such notice shall be served on the grantee not less than 30 days prior to the date of the hearing on the issue. The notice shall contain the time and place of the hearing and shall be published at least once in a newspaper of general circulation within the franchise area 10 days prior to the hearing date.

3. The Council shall hear any persons interested in the revocation and within 30 days after the conclusion of the hearing shall make its determination, based on a preponderance of the evidence, whether the grantee has committed a material breach of the franchise.

4. If the Council determines that the grantee has committed a material breach, then the Council may:

a. Declare the franchise revoked and any security fund and bonds forfeited; or

b. If in the Council’s sole judgment the material breach is curable by the grantee, direct the grantee to take appropriate remedial action within the time and manner and under the terms and conditions reasonably specified by the grantor.

5. The revocation, termination or forfeiture of the grantee’s franchise shall in no way affect any right of grantor to pursue any other remedy under this chapter, the franchise agreement or any provision of law.

D. Legal Challenge to Revocation. Any court action filed by the grantee to challenge the revocation of the franchise must be commenced within 30 days after the decision of the City Council.


13.04.140 Force majeure – Grantee’s inability to perform.

In the event the grantee’s performance of any of the terms, conditions or obligations required by this chapter or a franchise granted hereunder is prevented by a cause or event not within the grantee’s reasonable control, such inability to perform shall be deemed excused for so long as such cause or event continues and no penalties or sanctions shall be imposed as a result thereof. For the purpose of this section, causes or events not within the control of the grantee shall include, without limitation, acts of God, war, strikes, sabotage, riots or civil disturbances, labor disputes, restraints imposed by order of a governmental agency or court, explosions, acts of public enemies, natural disasters such as floods, earthquakes, landslides, and fires, failure of utility service necessary to operate the cable system, governmental, administrative or judicial order or regulation or other event that is reasonably beyond the grantee’s ability to anticipate or control. This provision also covers work delays caused by waiting for utility providers to service or monitor their own utility poles on which the grantee’s cable and/or equipment is attached, as well as unavailability of materials and/or qualified labor to perform the work necessary, but shall not include financial inability of the grantee to perform or failure of the grantee to obtain any necessary licenses and permits from other governmental agencies or the right to use the facilities of any public utility where such failure is due solely to the acts or omissions of the grantee, or the failure of the grantee to secure supplies, services, equipment, licenses or permits, necessary for the installation, operation, maintenance, repair or upgrade of the cable system where the grantee has failed to exercise reasonable diligence to secure such supplies, services, equipment, licenses or permits.


13.04.150 Abandonment or removal of franchise property.

A. Abandonment or Removal.

1. If the grantee discontinues the use of any of its property within the public rights-of-way for a continuous period of 12 months, such property shall be deemed to have been abandoned by the grantee. Any part of the cable system that is parallel or redundant to other parts of the cable system and is intended for use only when needed as a backup for the cable system or a part thereof shall not be deemed to have been abandoned because of its lack of use, until such time as the primary cable system property is abandoned or deemed to have been abandoned by the grantee.

2. The grantor may give the grantee permission to abandon, in place, any system facility or equipment constructed, operated or maintained under the franchise, subject to any reasonable conditions that grantor may lawfully impose. Unless such permission is granted, the grantee shall remove all abandoned facilities and equipment upon receipt of written notice from grantor and shall restore to grantor’s reasonable satisfaction any affected public right-of-way. In removing its facilities and equipment, the grantee shall restore all public rights-of-way to the condition they were in prior to such removal without materially interfering with any electrical or telephone, cable or other utility wires, poles, or attachments, at the grantee’s expense. The grantor shall have the right to inspect and approve the condition of the public rights-of-way prior to and after removal. In the event that the franchise agreement has expired or been revoked, the liability, indemnity, insurance and security fund provisions of this chapter and the franchise agreement shall continue in full force and effect until such removal and restoration work has been completed in accordance with this section.

3. Upon the approved abandonment in place of any cable system property, the grantee shall submit to the grantor an instrument, satisfactory in form to the grantor, transferring to the grantor the ownership of the abandoned cable system property.

4. At the expiration or revocation of the franchise agreement, the grantor shall have the right to require the grantee to remove, at its own expense, all portions of the cable system from all streets and public ways within the service area within a reasonable period of time, which shall not be less than 180 days. Grantor also shall have the right to purchase at a cost not to exceed the fair market value of the facilities at the time of such purchase, reduced by the amount of any unpaid damages incurred by the grantor in connection with the grantee’s operations.

B. Restoration by Grantor and Reimbursement of Costs. Upon reasonable written notice and upon the failure of the grantee to commence, pursue or complete any work to be done in any public right-of-way required by law or by the provisions of this chapter or the franchise agreement within the time prescribed and to the reasonable satisfaction of the grantor, the grantor may cause the work to be commenced and completed at the grantee’s expense. The grantor shall provide to the grantee an itemized work order setting forth in detail the nature and cost of the work completed. The grantee shall pay to the grantor the actual costs for such work no later than 30 days after the grantee’s receipt of the itemized work order. Should the grantee fail to pay the grantor within the time frame set forth above, the grantor may withdraw said funds from the security deposit, subject to the provisions of Section 13.04.130.B.

C. Extended Operation and Continuity of Services. Upon expiration or revocation of the franchise, the grantor may permit the grantee to continue to operate the cable system for an extended period of time. The grantee shall continue to operate the system under the terms and conditions of this chapter and the franchise agreement. It shall be the right of all subscribers to continue to receive all available cable services. The grantee shall provide continuous, uninterrupted service to its subscribers during transition periods following franchise expiration or revocation.

D. Receivership and Foreclosure.

1. At the sole option of the grantor and subject to applicable law, a franchise granted hereunder may be revoked 120 days after appointment of a receiver(s) or trustee(s) to take

http://www.codepublishing.com/CA/Vacaville/Vacaville13/Vacaville1304.html#13.04.130

over and conduct the business of the grantee, whether in a receivership, reorganization, bankruptcy or other action or proceeding, unless:

a. The receivership or trusteeship shall have been vacated within such 120 days; or

b. Such receivers or trustees within such 120 days shall have remedied all the defaults under the franchise or provided a plan for the remedy of such defaults that is acceptable to the grantor; or

c. Such receivers or trustees shall, within such 120 days, have executed an agreement duly approved by the court having jurisdiction whereby such receivers or trustees assume and agree to be bound by each and every term, provision and limitation of the franchise.

2. In the case of a foreclosure or other judicial sale of the cable system, in whole or in part, the grantor may serve notice of revocation upon the grantee and the successful bidder at such sale, and all rights and privileges of the grantee hereunder shall be revoked 30 days after service of such notice, unless:

a. A bona fide request to transfer the franchise has been submitted by the grantee for grantor review and approval;

b. The grantor shall have approved the transfer of the franchise, in the manner provided by law; and

c. The successful bidder agrees to assume and be bound by all terms and conditions of this chapter and the franchise agreement.


13.04.160 Grantor and subscriber rights.

A. Reservation of Grantor Rights. In addition to any rights specifically reserved to the grantor by this chapter or the franchise agreement, the grantor reserves to itself every right end power provided by any other ordinance, rule, law or regulation.

B. Waiver.

1. The grantor shall have the right to waive any provision of this chapter or the franchise agreement, except those that cannot be waived under federal or state law, if the grantor determines:

a. That it is in the public interest to do so; and

b. That the enforcement of such provision will impose an undue hardship on the grantee or subscribers.

2. To be effective, a waiver shall be in writing signed by a duly authorized representative of the grantor. Waiver of any provision shall not be deemed to be a continuing waiver of such provision unless the signed waiver so indicates.

3. The grantee shall not be excused from complying with any of the requirements of this chapter or the franchise agreement by the grantor’s failure to enforce the requirements on one or more occasions.

C. Rights of Individuals.

1. The grantee shall not deny cable service, or otherwise discriminate against subscribers or any person on the basis of race, color, religion, national origin, physical or mental disability, sexual orientation, gender or age. The grantee shall comply at all times with all applicable federal, state and local laws, and regulations relating to nondiscrimination.

2. The grantee shall adhere to any applicable equal employment opportunity requirements of federal, state and local governments as may be enacted or amended from time to time.

3. Unless otherwise authorized by a court of competent jurisdiction or otherwise authorized by federal law, neither the grantee nor any person shall, without the subscriber’s prior written consent, tap, or arrange for the tapping, of any cable, line, signal input device, or subscriber outlet or receiver for any purpose. The following prohibition shall not apply to the grantee’s routine maintenance of the system, detection of unauthorized service, polling with audience participation, or audience viewing surveys to support advertising research; provided, that individual viewing behavior cannot be identified.

4. In its operation of the cable system, the grantee shall take all reasonable steps to prevent the invasion of a subscriber’s right of privacy or other personal rights, to the extent provided by applicable law. The grantee shall not without lawful court order or other proper authority utilize the system’s interactive two-way equipment or capability, if such equipment or capability exists, for any unauthorized personal surveillance of any subscriber or person.

5. The grantee shall not erect or install any cable line, wire amplifier, converter, or other piece of equipment owned by the grantee on a subscriber’s premises, except within an appropriate easement or as may be provided by federal law, or at the request or with the consent of the subscriber.

6. Except as may be otherwise authorized by applicable law, the grantee, or any of its agents or employees, shall not sell, or otherwise distribute or make available, to any person without the prior consent of the subscriber:

a. Any list of the names and addresses of subscribers containing the names and addresses of subscribers; and

b. Any list which identifies or describes the viewing habits of individual subscribers, without the prior written consent of such subscribers.

This prohibition does not prohibit the grantee from providing composite ratings of subscriber viewing to any person.


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SUBJECT: ORDINANCE OF THE CITY COUNCIL OF THE CITY OF