Clovis Municipal Code Art. 4 Cable Systems

The provisions of this article apply to cable systems.

(§ 4, Ord. 05-23, eff. September 1, 2005)

(a) Applicability. This section applies to all applications to obtain an initial cable system franchise; to modify, transfer, extend, or renew formally or informally an existing cable system franchise; or to build or rebuild a cable system.

(b) Application requirement. An application must be filed with the City to obtain an initial cable system franchise; to modify, transfer, extend, or renew formally or informally an existing cable system franchise; or to build or rebuild a cable system.

(c) Content. The City Manager may specify the information that must be provided in connection with an application, and the form in which the information is to be provided. At a minimum, each application to obtain an initial cable system franchise; to modify, transfer, extend, or renew an existing cable system franchise; or to build or rebuild a cable system shall:

(1) Identify the applicant who is applying for the franchise, including the applicant’s addresses and business telephone numbers;

(2) State the names and addresses of persons authorized to act on behalf of the applicant with respect to the application; and

(3) Identify whether the applicant is applying to obtain an initial cable system franchise; to modify, transfer, extend, or renew an existing cable system franchise; or to build or rebuild a cable system.

(d) Filing and copies. To be accepted for filing, an original and six (6) copies of a complete application must be submitted to the City Clerk.

(e) Incomplete applications. An application may be rejected if it is incomplete, or if the response to requests for information is not timely and complete.

(§ 4, Ord. 05-23, eff. September 1, 2005)

(a) Applicability. This section establishes additional requirements for applications to obtain an initial cable system franchise; or to modify, transfer, extend, or formally renew a cable system franchise; or to build or rebuild a cable system. This section does not apply to an informal renewal of a cable system franchise.

(b) Additional requirements generally. In addition to the requirements set forth in this chapter and other applicable laws, all applications to obtain an initial cable system franchise; to modify, transfer, extend, or formally renew a cable system franchise; or to build or rebuild a cable system shall:

(1) Show that the applicant is financially, technically and legally qualified and able to construct, maintain and operate a cable system;

(2) Contain a pro forma showing capital expenditures and expected income and expenses for the first five (5) years the applicant is to hold the cable system franchise; and

(3) Show that the applicant is willing to comply with its franchise obligations, including the provisions of this chapter.

(c) Additional requirements to build or rebuild cable system. In addition to the requirements set forth in this chapter and other applicable laws, any application for an initial cable system franchise or to build or rebuild a cable system must describe in detail the cable system that the applicant proposes to build, show where it will be located, set out the system construction schedule, and show that the applicant will provide adequate channels/capacity, facilities and other support for public, educational and government use (including institutional network use) of the cable system. A detailed description of the physical facilities proposed, which shall include at least the following:

(1) A description of the channel capacity, technical design, performance characteristics, headend, access (and institutional network) facilities and equipment;

(2) The location of proposed facility and facility design, including a description of the miles of plant to be installed, and a description of the size of equipment cabinets, shielding and electronics that will be installed along the plant route, the power sources that will be used and a description of the noise, exhaust and pollutants, if any, that will be generated by the operation of the same; provided, however, that, if some of the descriptive data is not available at the time of application, the City may grant the franchise subject to conditions that the data be filed and approved by the City before construction begins and that the franchise will be deemed to be forfeited if the data is not supplied and approved; provided, further, that the foregoing proviso does not authorize the grant of a franchise where there is not sufficient information to appraise the impact of the applicant’s proposal;

(3) A map of the general route the facility will follow; a designation of the portions of the cable system that will be placed above ground and the portions that will be placed underground, and the construction techniques that the franchisee proposes to use in installing the cable system above ground and underground; a schedule for construction of the facility, describing when and where construction will begin, how it will proceed, benchmarks indicating the schedule competition of portions of the system and when construction will be completed; and the expected effect on public rights-of-way usage, including information on the ability of the public rights-of-way to accommodate the proposed cable system, including, as appropriate given the cable system proposed, an estimate of the availability of space in conduits and an estimate of the cost of any necessary rearrangement of existing facilities;

(4) A description, where appropriate, of how services will be converted from existing facilities to new facilities, and what will be done with existing facilities;

(5) A demonstration of how the applicant will reasonably meet the future cable-related needs and interests of the community, including descriptions of the capacity, facilities and support for public, educational, and governmental use of the cable system (including institutional networks) applicant proposes to provide and why applicant believes that the proposal is adequate to meet the future cable-related needs and interests of the community;

(6) The applicant must demonstrate financial qualifications, including at least the following:

(A) The proposed rate structure, including projected charges for each service tier, installation, converters, and all other proposed equipment or services; and

(B) A statement regarding the applicant’s financial ability to complete the construction to meet the time frame proposed and to operate the cable system proposed certified by the applicant’s chief financial officer;

(7) A demonstration of the applicant’s technical ability to construct and/or operate the proposed cable system;

(8) A demonstration that the applicant is legally qualified, which proof must include a demonstration that the applicant:

(A) Has received, or is in a position to receive, necessary authorizations from state and federal authorities;

(B) Has not engaged in conduct (fraud, racketeering, violation of antitrust laws, consumer protection laws, or similar laws) that allows the City to conclude the applicant cannot be relied upon to comply with requirements of a franchise or provisions of this title;

(C) Is willing to enter into a franchise, to pay required compensation and to abide by the provisions of applicable law, including those relating to the construction, operation or repair of its facilities; and has not entered into any agreement that would prevent it from doing so; and

(D) Has not submitted an application for an initial or renewal franchise to the City, which was denied on the ground that the applicant failed to propose a cable system meeting the cable-related needs and interests of the community, or as to which any challenges to such franchising decision were finally resolved (including any appeals) adversely to the applicant, within three (3) years preceding the submission of the application;

(9) A demonstration that it would be inappropriate to deny the applicant a franchise by virtue of:

(A) The particular circumstances surrounding the acts or omissions at issue;

(B) The steps taken by the applicant to cure all harms flowing therefrom and to prevent their recurrence; and

(C) The lack of involvement of the applicant’s principals, or the remoteness of the acts or omissions from the operation of cable systems;

(10) The extent that the applicant is in any respect relying on the financial or technical resources of another person, including another affiliate, proofs should be provided for that person;

(11) A description of the applicant’s prior experience in cable system ownership, construction, and operation, and identification of cities and counties in California in which the applicant or any of its principals have a cable franchise or any interest therein; provided, that an applicant that holds a franchise for the City and is seeking renewal of that franchise need only provide this information for other cities and counties in California where its franchise is scheduled to expire during the twelve (12) month period prior to the date its application is submitted to the City and for other cities and counties in California where its franchise had been scheduled to expire during the twelve (12) month period after the date its application is submitted to the City. If an applicant has no other franchise in California, it shall provide the information for its operations in other states;

(12) An affidavit or declaration of the applicant or authorized officer thereof certifying the truth and accuracy of the information in the application, and certifying that the application meets all requirements of applicable law.

(d) Request for information. An applicant (and the transferor and transferee, in the case of a transfer) shall respond to any request for information or documents from the City within the time specified by the City.

(§ 4, Ord. 05-23, eff. September 1, 2005)

(a) Applicability. This section establishes additional provisions that apply to applications for formal renewal of cable system franchises governed by 47 U.S.C. Section 546(a) through (g).

(b) Notice. A franchisee that intends to formally renew a franchise shall submit a notice in writing to the City in a timely manner clearly stating that it is activating the procedures set forth in 47 U.S.C. Section 546(a) through (g).

(c) Proceedings and consideration by City. After receipt of the franchisee’s notice, the City shall commence any proceedings that may be required under federal law, and upon completion of those proceedings, the City may issue a request for proposals and an application may be submitted for renewal. The City may preliminarily deny the application by resolution and, if the application is preliminarily denied, the City may conduct such proceedings and by resolution establish such procedures and appoint such individuals as may be necessary to conduct any proceedings to review the application.

(§ 4, Ord. 05-23, eff. September 1, 2005)

(a) Submission of application.

(1) Any person may apply for an initial franchise by submitting an application to the City Clerk on that person’s own initiative or in response to a request for proposals issued by the City. If the City receives an unsolicited application, it may choose to issue a request for additional proposals, and require the applicant to amend its proposal to respond thereto. The City shall promptly conduct such investigations as are necessary to act on an application.

(2) An application to informally renew a cable system franchise may be submitted by a franchisee to the City Clerk.

(b) Consideration of applications. In determining whether to grant or renew a franchise, the City may consider:

(1) The extent to which an applicant for renewal has substantially complied with the applicable law and the material terms of any existing cable system franchise;

(2) The applicant’s quality of service under its existing franchise, including signal quality, response to customer complaints, billing practices, and the like has been reasonable in light of the needs of the community;

(3) The quality of the applicant’s proposed services and its rates to subscribers, by the applicant;

(4) Where the applicant has not previously held a cable system franchise in the City, whether the applicant’s record in other communities indicates that it can be relied upon to provide high-quality service throughout any franchise term;

(5) Whether the applicant has the experience, financial, legal, and technical ability to provide the services, facilities, and equipment set forth in an application, and to satisfy any minimum requirements established by the City;

(6) Whether the applicant’s application is reasonable to meet the future cable-related needs and interests of the City, taking into account the cost of meeting such needs and interests;

(7) Whether issuance of a franchise is warranted in the public interest considering the immediate and future effect on the public rights-of-way, public property, and private property that will be used by the applicant’s cable system;

(8) Whether issuance of the franchise would reduce competition in the provision of cable service in the City;

(9) Income to the City;

(10) The technical and performance quality of the equipment to be used by the applicant;

(11) The willingness and ability of the applicant to meet construction and physical requirements, policy conditions, franchise limitations, and requirements imposed by this chapter; and

(12) Other considerations deemed pertinent by the Council for safeguarding the interest of the City and the public, or such other matters as the City is authorized or required to consider.

(c) Recommendation of City Manager. The City Manager shall report and recommend to the Council that an application should be accepted, rejected, or that other actions should be taken on the application.

(d) Hearing and consideration by Council.

(1) After receipt of the City Manager’s report and recommendations, the application shall be agendized for a public hearing before the Council.

(2) At the hearing, the applicant shall be provided an opportunity to present information regarding its application, and to respond to questions from the Council and public comments.

(3) At the hearing, the Council may hear protests to or comments from the public regarding the applicant’s application.

(4) After the hearing, the Council shall make one of the following determinations, which determination shall be final and set forth in a resolution:

(A) The application shall be denied;

(B) The application shall be granted as requested;

(C) The application shall be granted, subject to certain terms and conditions; or

(D) A determination on the application shall be postponed pending further study or other actions.

(5) If the Council determines to accept such application, the following shall be done or caused to be done:

(A) The Council shall decide and specify the terms and conditions of any franchise to be granted hereunder and as herein provided;

(B) The Council shall pass its resolution of intention to grant such franchise, stating the name of the proposed franchisee, the character of the franchise, the terms and conditions upon which such franchise is proposed to be granted, fixing and setting forth a day, hour, and place certain when and where any persons having any interest therein or objection to the granting thereof may appear before the Council and be heard, and directing the City Clerk to publish said resolution at least once, within fifteen (15) calendar days of the passage thereof;

(C) Within fifteen (15) calendar days after the passage of said resolution, the City Clerk shall cause the same to be published in a newspaper of general circulation within the City, and the same shall be published at least ten (10) calendar days prior to the date specified for hearing thereon. Copies of such resolution shall be mailed to any person requesting same in writing.

(e) Franchise agreement. If the City determines that issuance or informal renewal of a franchise would be in the public interest considering the factors described above, following public hearing and adoption of any required resolution of intention and the public notice and comment period thereunder, it may proffer a franchise agreement to the applicant. No franchise shall become effective until the applicant unconditionally accepts the franchise, and the franchise agreement is signed.

(§ 4, Ord. 05-23, eff. September 1, 2005)

(a) Applicability of section. This section establishes additional provisions that apply to applications for approval of a transfer of a cable franchise system.

(b) Notice and approval required. Every franchise shall be deemed to be held in trust, and to be personal to the franchisee. Any transfer that is made without the prior approval of the City shall be deemed to impair that trust. No transfer shall occur without prior written notice to and approval of the City.

(c) Additional application requirements. An application for transfer must contain all the information required by the City Manager, by this article and all information required by any FCC transfer form. At a minimum, an application must:

(1) Describe the entities involved in the transaction and the entity that will hold the franchise;

(2) Describe the chain of ownership before and after the proposed transaction;

(3) Show that the entity that will hold the franchise will be legally, financially, and technically qualified to do so;

(4) Attach complete information on the proposed transaction, including the contracts or other documents that relate to the proposed transaction, and all documents, schedules, exhibits, or the like referred to therein; and

(5) Attach any shareholder reports or filings with the Securities and Exchange Commission (“SEC”) that discuss the transaction.

(d) Minimum qualification of transferee.

In order to obtain approval of a transfer, an applicant must show, at a minimum, that: the transferee is qualified; the transfer will not adversely affect the interests of subscribers, the public, or the City; and that noncompliance issues have been resolved. No application shall be granted unless the transferee agrees in writing that it will abide by and accept all terms of this chapter and the franchise, and that it will assume the obligations, liabilities, and responsibility for all acts and omissions, known and unknown, of the previous franchisee for all purposes.

(e) Additional qualification of transferee. To be eligible to be considered as a transferee, the transferee must meet the following additional requirements:

(1) Be willing to comply with the provisions of this chapter and applicable laws; and to comply with such requirements of a franchise as the City may lawfully require;

(2) Has not had any cable system or OVS franchise validly revoked (including any appeals) by the City within three (3) years preceding the submission of the application;

(3) Has not had an application to the City for an initial or renewal cable system franchise denied on the ground that the applicant failed to propose a cable system meeting the cable-related needs and interests of the community, or as to which any challenges to such franchising decision were finally resolved (including any appeals) adversely to the applicant, within three (3) years preceding the submission of the application; and may not have had an application for an initial or renewal franchise denied on any ground within three (3) years of the application;

(4) At any time during the ten (10) years preceding the submission of the application, transferee has not been convicted of fraud, racketeering, anticompetitive actions, unfair trade practices or other conduct of such character that the applicant cannot be relied upon to deal truthfully with City and the subscribers, or to substantially comply with its obligations;

(5) Has obtained the necessary authority under California and federal law to operate a cable system or show that it is in a position to obtain that authority;

(6) Has not filed materially misleading information in its application or intentionally withholds information that the applicant lawfully is required to provide.

(f) Notwithstanding any other provision of this article, pledges in trust or mortgages of the assets of a cable system to secure the construction, operation, or repair of the system may be made without application and without the City’s prior consent. However, no such arrangement may be made if it would in any respect under any condition: (1) prevent the franchisee or any successor from complying with the franchise or applicable law; or (2) permit a third party to succeed to the interest of the franchisee, or to own or control the system, without the prior consent of the City. Any mortgage, pledge or lease shall be subject to and subordinate to the rights of the City under any franchise, this chapter, or other applicable law.

(§ 4, Ord. 05-23, eff. September 1, 2005)

(a) Applicability. This section sets forth the procedures for applications to modify, extend or for other actions with respect to an existing cable system franchise.

(b) Recommendation of City Manager. The City Manager shall report and recommend to the Council that an application should be accepted, rejected, or that other actions should be taken on the application.

(c) Consideration by Council. Upon receipt of the City Manager’s report and recommendations, the Council, at its sole option and discretion, may agendize and hold a public hearing to consider the application, consider the application without a public hearing, or take such other actions as it determines to be appropriate under the circumstances.

(§ 4, Ord. 05-23, eff. September 1, 2005)

(a) Amount. For any twelve (12) month period, a franchisee shall pay to the City a franchise fee in an amount equal to five percent (5%) of the franchisee’s gross revenues derived in such period, or such other amount as may be specified in the franchise documents. The amount of franchise fee shall be subject to increase should federal limits on fee payments be eliminated or changed and other cable operators are subject to a higher fee. For purposes of this section, the twelve (12) month period shall be the twelve (12) month period applicable under the franchise for accounting purposes.

(b) Bundling of service. In the event that a franchisee bundles services that are included in the definition of gross revenue with other services not included, the unbundled amount of gross revenue will be based on the published rate for any service provided for in a cable system franchise. Exception can be made with a clear showing by the franchisee that services offered pursuant to a franchise were discounted along with an accounting of the amount of said discount.

(c) Discounts. If a franchisee offers subscribers any kind of discount for receipt of both franchised cable and noncable services (which are not included in the definition of gross revenues), the discount may be applied proportionately to franchised cable services and noncable services upon notification to the City of such discount methodology. Such notification shall include the amount of the discount being applied to each service and documentation demonstrating the promotion and billing of such discount.

(§ 4, Ord. 05-23, eff. September 1, 2005)

In addition to satisfying such additional or stricter conditions as the City finds necessary based on its investigations, the following elements shall be required in every franchise unless specifically exempted in writing by the City:

(a) System design. Each franchisee shall provide a cable system, which uses at least seven hundred fifty (750) MHz equipment of high quality and reliability or as required by applicable law, whichever has a higher quality and reliability as determined by the City. Each franchisee shall install and activate the return portion of the cable system in the sub-low frequency spectrum of five (5) MHz to thirty (30) MHz or as required by applicable law, whichever has a higher quality and reliability as determined by the City.

(b) Public, educational and government use of the cable system.

(1) Each franchisee, at the City’s request, shall provide as a minimum the greater of three (3) channels or eighteen (18) MHz of bandwidth for PEG access to each subscriber.

(2) Each franchisee shall install, maintain, and replace, as necessary, a dedicated, bi-directional fiber optic link (or link with equivalent or superior functionality, capacity and reliability) between its headend and a location designated by the City as the primary access center.

(3) Each franchisee shall install, maintain, and replace activated two (2) way cable plant and all headend, cable plant, and node equipment required to make it operable so that the City, schools, and all designated PEG access centers and access facilities located within the franchise area will be able to send and receive signals (video, audio, and data) using the activated two (2) way cable plant.

(4) Each franchisee shall ensure that technically adequate signal quality, routing systems, and switching and/or processing equipment are initially and continuously provided for all access interconnections both within franchisee’s cable system and with other cable systems throughout the duration of its franchise.

(5) If a franchisee makes any change in the cable system and related equipment and facilities or in the franchisee’s signal delivery technology which directly or indirectly substantially affects the signal quality or transmission of access programming, the franchisee shall at its expense take necessary steps or provide necessary technical assistance, including the acquisition of all necessary equipment, to ensure that the capabilities of access programmers are not diminished or adversely affected by such change.

(6) A franchisee shall maintain all access channels (both upstream channels and downstream channels) and all interconnections of access channels at the same level of technical quality and reliability as the best commercial channels carried on the franchisee’s system.

(c) Service to franchise area. It is the policy of the City to ensure that every cable system provides service in its franchise area upon request to any person or any government building. Each franchisee shall extend service upon request within its franchise area; provided, that a franchise may permit a franchisee to require a potential subscriber to contribute a fair share of the capital costs of installation or extension as a condition of extension or installation in cases where such extension or installation may be unduly expensive. Service must be provided within time limits specified in the section immediately below.

(d) Extension of cable service to subscribers. Except as a franchise otherwise provides, service must be extended upon request to any person or to any government building in a franchisee’s franchise area (i) within seven (7) calendar days of the request, where service can be provided by activating or installing a drop; (ii) within ninety (90) calendar days of the request where an extension of one-half (1/2) mile or less is required; or (iii) within six (6) months where an extension of one-half mile or more is required.

(e) Technical standards. A cable system within the City shall meet or exceed the technical standards set forth in 47 U.S.C. Section 544 (e); 47 C.F.R. Section 76.601 and any other applicable technical standards.

(f) Testing. Each franchisee shall perform at its expense such tests as may be necessary to show whether or not the franchisee is in compliance with its obligations under applicable FCC standards, this chapter or a franchise.

(g) Interconnections. Upon request of the City, every cable system shall interconnect with every other cable system in the City, or adjacent to the City, on fair and reasonable terms for purposes of providing PEG and I-Net services.

(§ 4, Ord. 05-23, eff. September 1, 2005)

(a) Rate regulation. The City may regulate any franchisee’s rates and charges, except to the extent it is prohibited from doing so by law. The City will regulate rates in accordance with FCC rules and regulations, where applicable. Except to the extent FCC rules provide otherwise, all rates and charges that are subject to regulation, and changes in those rates or charges must be approved in advance. The City Manager may take any required steps to file complaints, toll rates, issue accounting orders, or take any other steps required to comply with FCC regulations. The Council shall be responsible for issuing rate orders that establish rates or order refunds.

(b) Nondiscrimination.

(1) Except to the extent the City may not legally enforce such a requirement, a franchisee is prohibited from discriminating in its rates or charges or from granting undue preferences to any subscriber, potential subscriber, or group of subscribers or potential subscribers; provided, however, that a franchisee may offer temporary, bona fide promotional discounts in order to attract or maintain subscribers, so long as such discounts are offered on a nondiscriminatory basis to similar classes of subscribers throughout the franchise area; and a franchisee may offer discounts for the elderly, the disabled, or the economically disadvantaged; and such other discounts as it is expressly entitled to provide under federal law, if such discounts are applied in a uniform and consistent manner.

(2) A franchisee shall not deny access or charge different rates to any group of subscribers or potential subscribers because of the income of the residents of the local area in which such group resides.

(§ 4, Ord. 05-23, eff. September 1, 2005)

(a) Minimum requirements. Each franchisee must satisfy all applicable FCC, state and the City’s cable customer service standards or consumer protection standards, including 47 C.F.R. Section 76.309. The City may establish, from time to time, by resolution, cable customer service standards that exceed or are additional to federal and state requirements and that are not specifically preempted. In the case of a conflict among standards, the stricter standard shall apply.

(b) Notice to subscribers. As subscribers are connected or reconnected to the cable system, and at least once annually thereafter, the franchisee shall provide each subscriber with written information concerning the procedures for making inquiries or complaints, including the name, address and local telephone number of the employee or employees or agent to whom such inquiries or complaints are to be addressed, and also furnish information concerning the City office responsible for administration of the franchise with the name and telephone number of the office. The notice shall also indicate franchisee’s business hours and procedures for responding to inquiries after normal business hours. The franchisee shall provide all subscribers and the City written notice no less than thirty (30) calendar days prior to any proposed change in these policies. Under normal circumstances, the franchisee shall provide all subscribers and the City with at least thirty (30) calendar days written notice prior to the implementation of any change in rates or programming services. Copies of all notices provided to subscribers shall be filed concurrently with the City.

(§ 4, Ord. 05-23, eff. September 1, 2005)