Azusa Municipal Code Art. V Finance

(a) As compensation for any franchise to be granted, and in consideration of permission to use the streets and public ways of grantor for the construction, operation, maintenance, and reconstruction of a system, the grantee shall pay to the grantor such amounts as specified in the franchise.

(b) Payments due the grantor under this provision shall be computed quarterly for the succeeding quarter, and shall be paid within 45 days of the close of each calendar quarter. The payment shall be accompanied by a report showing the basis for the computation and such other relevant facts as may be required by the grantor to determine the accuracy of a said payment.

(c) In the event that any franchise payment or recomputed amount is not made on or before the dates specified herein, grantee shall pay as additional compensation the greater of the following:

(1) An interest charge, computed from such due date, at the annual rate equal to the prevailing commercial prime interest rate in effect upon the due date plus one percent.

(2) A sum of money equal to $4,000.00 for each month or part thereof of delay which sum shall also bear interest from the due date at an annual rate equal to the prevailing commercial prime interest rate in effect upon the due date plus one percent.

(d) In addition to any late payment made pursuant to section 22-103(c) above, if a payment is late by 60 days or more, grantee shall pay a sum of money equal to five percent of the amount due in order to defray additional expenses and costs incurred by grantor by such delinquent payment.

(e) If the FCC, Congress or other governmental entity with appropriate authority ever allows a governmental entity to increase the franchise fee beyond five percent, then that governmental entity shall have the authority to increase the franchise fee to the maximum percentage allowable.

(f) The grantee shall pass through to subscribers the amount of any decrease in a franchise fee.

(g) No acceptance of any payment shall be construed as a release of, or an accord, or satisfaction of, any claim that the grantor might have for further or additional sums payable under the terms of this chapter, or for any other performance or obligation of a grantee hereunder.

(h) Payments of compensation made by a grantee to the grantor pursuant to the provisions of this chapter shall be considered in addition to, and exclusive of, any and all authorized taxes, business license fees, other fees, other levies or assessments present in effect, or subsequently adopted.

(i) A franchise fee does not include any items excluded by section 622(g)(2)(D) of the Cable Act (codified at 47 USC 542(g)(2)(D)).

(j) Nothing in this section shall be construed to limit the authority of the grantor to impose a fee or other assessment of any kind, on any person with respect to a service or other programming provided by such person over a system for which charges are assessed to subscribers, but not received by a grantee hereunder. For purposes of illustration only, this subsection shall include the situation(s) where a premium service billing directly to a subscriber, or where a person leases a channel for commercial use and sells advertising or goods on that channel, and receives the money directly or through a third party.

(l) In light of subsection (k) of this section, the franchise may contain express language which permits a different method or manner for collection of franchise fees should the applicable provision of the franchise be ruled unconstitutional or unenforceable, so that the city's source of revenue and compensation for the use of the public right-of-way may be protected.

(Ord. No. 95-08, § 6.1, 4-17-95)

(a) Within 30 days after the effective date of the franchise, the grantee shall deposit into a bank account established by the grantor, and maintain on deposit through the term of the franchise, a sum specified in the franchise as security for the faithful performance by it of all of the provisions of the franchise, and compliance with this chapter, and compliance with all orders, permits and directions of any agency of the grantor having jurisdiction over its acts or defaults, and the payment by the grantee of any claims, fees, liens, taxes due the grantor which arise by reason of the construction, operation or maintenance of the system and to satisfy any actual or liquidated damages arising out of a franchise breach.

(b) Except as provided in the franchise, if the grantee fails, after 20 days notice, to pay to the grantor any fees due and unpaid, or fails to repay within such 20 days, any damages, costs or expenses which the grantor shall be compelled to pay by reason of any act or default of the grantee in connection with its franchise; or fails to comply with any provision of the franchise or this chapter, upon a determination by the grantor that such failure was without just cause and which the grantor reasonably determines, in a manner consistent with the procedures specified in section 22-261 of this chapter, can be remedied by an expenditure of the security or is nevertheless subject to liquidated damages, the grantor may immediately withdraw the amount thereof, with interest and/or any liquidated damages, from the security fund. Upon such withdrawal, the grantor shall notify the grantee of the amount and the date thereof.

(c) Within 30 days after notice to it that any amount has been withdrawn by grantor from the security fund, the grantee shall deposit a sum of money sufficient to restore such security fund to the original amount.

(d) Grantee shall be entitled to the return of such security fund, or portion thereof, with interest, if any, as remains on deposit at the expiration of the franchise, or its termination, once all amounts due to the grantor have been paid:

(e) The rights reserved to the grantor with respect to the security fund are in addition to all other rights of the grantor and no action, proceeding or exercise of a right with respect to such security fund shall affect any other right the grantor may have.

(Ord. No. 95-08, § 6.2, 4-17-95)

Within 30 days after the effective date of the franchise, the grantee shall furnish proof of the posting of a faithful performance bond in favor of the grantor, with corporate surety approved by the grantor, which approval shall not be unreasonably withheld, in the sum specified in the franchise conditioned that the grantee shall well and truly observe, fulfill, and perform each term and condition of the franchise, provided, however, that such bond shall not be required upon certification by grantor of completion of construction of grantee's cable system. The corporate surety must be authorized to issue such bonds in the State of California and secured through an authorized agent in the County of Los Angeles. As defined in the franchise, during the course of construction, the amount of the bond may from time to time be reduced as provided in the franchise. Written evidence of payment of premiums shall be filed and maintained with the grantor.

(Ord. No. 95-08, § 6.3, 4-17-95)

(a) At the option of the grantor, it may allow the grantee to post in lieu of security fund and/or faithful performance bond, an irrevocable letter of credit, issued by a bank approved by the grantor, in the amount specified in the franchise. Said letter of credit shall incorporate wording approved by the grantor enabling it to draw such sums from time to time as the grantor may find necessary to satisfy any defaults of grantee or to meet any payments due grantor under or in connection with this chapter or grantee's franchise upon ten days written notice to the letter of credit provider. Said letter of credit shall further provide for 60 days written notice by certified mail by its issuer to grantor of any pending expiration or cancellation, or other language acceptable to the city attorney, and said notice shall without further cause constitute reason for the grantor to draw the full sum to be held in its own accounts until such letter shall be reestablished in good and satisfactory form to grantor.

(b) If grantor shall require such a letter of credit, grantee shall pay all fees or other charges required to keep it in force and shall, within 30 days of any draw by grantor, restore its face value to the original amount.

(c) All provisions herein applying to bonds or security funds shall also apply to letters of credit.

(Ord. No. 95-08, § 6.4, 4-17-95)