Chapter 5.06 — VIDEO FRANCHISE FEES, CUSTOMER SERVICE AND OTHER VIDEO-RELATED MATTERS

(a) Under Division 2.5 of the California Public Utilities Code (“CPUC”), the Digital Infrastructure and Video Competition Act of 2006, commencing at Section 5800, et seq. (“DIVCA”), the California Public Utilities Commission (PUC) has the exclusive authority to grant and administer State video franchises. The definitions contained in DIVCA apply to this Chapter.

(b) Notwithstanding, DIVCA confers certain rights and responsibilities to the City of Canyon Lake with respect to State video franchise holders (“SVFH”) operating within the City under DIVCA, including but not limited to, receipt of fees for rent of right-of-ways in the form of a franchise fee and additional fees for support of public, educational, and governmental (“PEG”) access channels. Both fees are based on a percentage of the gross revenues of State franchise holders. The City also hereby establishes and enforces penalties for violations of customer service rules. The City retains authority, without change, over all City video franchisees until such time as they no longer hold a City franchise, or are no longer operating under a current City franchise. The City may modify, renew, extend or terminate existing City video franchises.

(Ord. 109, passed 11-5-2008)

(a) Each SVFH, shall pay a fee to the City equal to 5% of that SVFH's gross revenue, as defined in CPUC section 5860, pursuant to CPUC section 5840(q)(1). Failure to pay the fee in a timely manner will incur fines to the City as set out in that section.

(b) In addition, each SVFH shall pay a PEG channel fee to the City equal to 1% of that SVFH's gross revenue, as defined in 5.06.1.1, pursuant to CPUC section 5870(n). This fee shall be in addition to the fee paid in 5.06.1.1. The City shall expend these monies for the purpose of supporting PEG channel facilities and programming. (Ord. 109, passed 11-5-2008)

Not more than once annually, the City Manager or his/her designee may examine and perform an audit of an SVFH's records kept in the ordinary course of business, such as those commonly used and relied upon for accounting purposes or in preparation of financial statements or pro formas, to ensure compliance with this section. In the event that the audit discloses an underpayment of 5% or more, the SVFH shall pay for the audit. If the audit discloses that all fees have been paid, the City shall pay for the audit; otherwise, the cost shall be divided evenly between the parties. (Ord. 109, passed 11-5-2008)

(a) An SVFH shall comply with all applicable State and Federal customer service and protection standards pertaining to the provision of video service. In addition, the SVFH shall prepare, adopt and annually review its own consumer standards regarding installation and service; telephone and office hours; billing procedures; termination of service; change in service; and complaint procedures. Each SVFH annually must distribute such standards to the City and to each customer.

(b) The City shall give the SVFH written notice of its failure to distribute such notice. If distribution does not occur within 60 days after receipt of the notice, the City may impose and collect a penalty of $500 for each year in which the notice is not distributed after such notice.

(Ord. 109, passed 11-5-2008)

Where the City Manager determines that an SVFH has materially breached any provision of its own consumer standards or of State or Federal law, including but not limited to nonpayment of franchise fees, the City may provide written notice of the breach (“notice of breach”) to the SVFH.

(a) A “material breach” is defined as an SVFH's substantial and repeated failure to comply with service quality and other standards of Federal or State law or of its own consumer standards.

(b) Receipt of a notice of breach shall be deemed to have occurred either:

(1) Five calendar days after the date on which the notice of breach was deposited to be mailed with the United States Postal Service or equivalent;

(2) Two calendar days after the date the notice of breach was sent via facsimile or e-mail; or

(3) On the date an SVFH's designated representative was personally served the notice of breach.

(Ord. 109, passed 11-5-2008)

(a) An SVFH which has been issued a notice of breach shall either remedy the conduct described in the notice of breach (“notice of breach conduct”) to the satisfaction, and in the sole discretion of, the City Manager no later than 30 calendar days from the date of receipt of the notice; or assert that the SVFH should be exempted from violation because the violation is out of its control.

(b) If the SVFH asserts that the notice of breach conduct is out of its reasonable control, then the SVFH shall submit a request for exemption from breach. A request for exemption from breach shall contain all of the following points in order to be considered by the City Manager: It shall be in writing; it shall describe in detail why the conduct was out of its reasonable control; it shall describe in detail the notice of breach conduct, the reasons for its occurrence, all factors and/or influences asserted to be outside the SVFHs control thereby creating the conduct, and all facts precluding the SVFH's ability to remedy; and it shall include as attachments any and all supporting documentation which the SVFH wishes the City Manager to review. Only information so submitted shall be considered by the City Manager.

(Ord. 109, passed 11-5-2008)

(a) Where the City Manager receives a request for exemption from breach described the City Manager shall review the request for exemption from breach promptly; and shall render a final determination on the request for exemption from breach. This final determination shall be in writing and shall include one of the following conclusions: (i) The notice of breach conduct is outside the SVFH's control and is therefore exempt; or (ii) The notice of breach conduct is within the SVFH's control and is therefore subject to the provisions of this Chapter.

(b) The City Manager's decision is final.

(Ord. 109, passed 11-5-2008)

(a) Each SVFH that fails to remedy the notice of breach conduct in violation of this Section (“un-remedied breach”) and/or that fails to obtain an exemption determination shall pay a penalty to the City as set out here.

(b) Penalties for an SVFH's failure to remedy the notice of breach conduct shall accrue daily as follows:

(1) Commencing on the first calendar day following expiration of the time to cure through the date of remedy of the breach; or

(2) Commencing on the first calendar day following receipt of denial of a request for exemption from breach through the date of remedy of the breach.

(c) An SVFH shall pay a penalty for the un-remedied first notice of breach not to exceed a fine of $500 for each calendar day, not to exceed $1,500 for each occurrence of an un-remedied breach.

(d) For a second material breach of a similar nature as the notice of breach for which a penalty was assessed, occurring within 12 months from the date of the first notice of breach, whether remedied or not, an SVFH shall pay a penalty accruing not to exceed $1,000 per calendar day, not to exceed $3,000, for each occurrence of an un-remedied breach.

(e) For a third or further material breach, of a similar nature as the notice of breach for which a penalty was assessed, occurring within the same 12 months of the date of the notice of breach, whether or not remedied an SVFH shall pay a penalty not to exceed $2,500 per calendar day, not to exceed $7,500 for each occurrence of an unremedied breach.

(Ord. 109, passed 11-5-2008)

(a) An SVFH assessed a penalty under Section 5.06.080 may appeal the assessed penalty only by satisfying all of the following: Submit to the City Manager a written appeal describing in detail the basis for the appeal; and file the appeal no later than 60 calendar days from receipt of the notice of penalties;

(b) Where the City Manager receives an appeal under this Section, the City Manager shall review the appeal promptly, render a final determination on the appeal, and provide a final written determination; and

(c) The City Manager's determination on the appeal shall be final. The penalty owing shall be a debt to the City that may be collected in any legally available manner.

(Ord. 109, passed 11-5-2008)

(a) Applicants for State video franchises within the boundaries of the City of Canyon Lake shall concurrently provide complete copies to the City of any application or amendments to applications filed with the PUC. The applicant shall provide one complete copy to the City Clerk, and another complete copy to the City Manager.

(b) In its discretion, the City may provide any comments to the PUC on the application or amendments to the application.

(Ord. 109, passed 11-5-2008)