Buena Park Municipal Code Art. VII Franchise Fee and Financial Requirements

A. Following the issuance and acceptance of the franchise, the grantee shall pay to the grantor a franchise fee on gross annual cable service receipts in the amount and at the times set forth in the franchise agreement. For receipts derived from services provided by the grantee that do not fall within the definition of cable service, the grantee shall pay an in-lieu-of-franchise-fee payment in the maximum amount permitted by applicable law, not to exceed the percentage established in the franchise agreement for gross annual cable service receipts.

B. The grantor, on an annual basis, shall be furnished a revenue statement within sixty days of the close of the calendar year, either audited and certified by an independent certified public accountant or certified by an officer of the grantee, reflecting the gross annual cable service receipts, and all other receipts derived from the operations of grantee's cable system in the franchise area, and all payments, deductions and computations for the period covered by the payment. Upon thirty days prior written notice, grantor shall have the right to conduct an independent audit of grantee's records, in accordance with generally accepted accounting procedures, and if such audit indicates a franchise fee and/or in-lieu fee underpayment of three percent or more, the grantee shall assume all reasonable costs of such audit.

In the event of a dispute with respect to the calculation of the franchise fee, the grantor and the grantee shall first attempt to resolve such dispute in accordance with the mediation procedures set forth in Section 5.20.410 of this chapter.

C. Except as otherwise provided by law, 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 and/or in-lieu fee under this chapter or for the performance of any other obligation of the grantee.

D. In the event that any franchise and/or in-lieu fee payment or recomputed amount is not made on or before the dates specified in the franchise agreement, grantee shall pay as additional compensation:

1. An interest charge, computed from such due date, at an annual rate equal to the prime lending rate of the largest national bank which operates a branch office in the grantee's service area, plus one percent during the period for which payment was due; and

2. If the payment is late by forty-five days or more, a sum of money equal to five percent of the amount due in order to defray those additional expenses and costs incurred by the grantor by reason of delinquent payment.

E. Franchise fee and/or in-lieu fee payments shall be made in accordance with the schedule indicated in the franchise agreement.

(Ord. 1354 § 9.1, 1997)

A. Grantor may require 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.

B. The security fund shall be available to grantor to satisfy all claims, liens and/or taxes due grantor from grantee which arise by reason of construction, operation or maintenance of the system, and to satisfy any actual or liquidated damages arising out of a material breach of the franchise agreement, subject to the procedures and amounts designated in the franchise agreement.

C. If the security fund is drawn upon by grantor in accordance with the procedures established in this chapter and the franchise agreement, grantee shall cause the security fund to be replenished to the original amount no later than thirty days after each withdrawal by grantor. Failure to replenish the security fund shall be deemed a material breach of the franchise.

(Ord. 1354 § 9.2, 1997)