Diamond Bar Municipal Code Div. 2 Application

Any person desiring a franchise for a cable television system shall file an original application and 11 copies with the department in its capacity as staff for the business license commission.

(Ord. No. 14(1989), § 2(16.62.010), 6-27-89)

To the extent permitted by law, proprietary information may be kept confidential, if appropriately identified. If an applicant believes that the information it must submit in its application should be treated confidentially by the city, it must so advise the department by letter prior to or with its application. If it is determined by the city that such information is not confidential, the applicant will be so notified and the information will be returned to the applicant at applicant's request.

(Ord. No. 14(1989), § 2(16.62.015), 6-27-89)

An application for a franchise for a cable television system shall contain the following information, where applicable:

(1) Designation of the specific area to be served by the franchisee to include the following:

a. A street map of the area to be served, including the location of proposed or existing headend site (antenna site), microwave sites, if any, and business office;

b. The extent, if any, to which the applicant intends to overbuild the existing cable operator's facilities; and

c. Inclusion of line extension areas, if any. Line extension areas are those areas which at time of application are not developed sufficiently for provision of cable services within the terms of section 13.12.1210, but are anticipated to reach sufficient development or density of population during the term of the franchise to support the extension of cable services.

(2) Identification of the applicant to include the following:

a. Indicate corporate or business entity organization of the applicant (e.g., partnership, corporation), and submit copies of corporate or business formation papers (e.g., articles of incorporation and bylaws; limited partnership agreement); include the names and addresses of any parent or subsidiary of applicant or any other business entity owning or controlling applicant in whole or in part, or owned or controlled in part by the applicant.

b. Indicate basis for acquiring ownership: whether ownership or the holding was acquired at same per-share costs as other owners, whether services or other in-kind contributions are included as a basis for acquiring ownership.

c. Indicate whether a buy-out agreement exists, whether written or verbal, giving other stockholders, persons or entities the right to acquire the interest of local stockholders in the future; submit copies of the agreements.

d. Resume of prior business history of applicant, including the expertise of applicant in the cable television field.

e. List of all stockholders of applicant owning or controlling five percent or more of the stock of the applicant and the percentage of stock owned or controlled by each.

f. List of officers of the applicant, together with a description of education and business background of each officer.

g. Provide specific information regarding whether the applicant, including the parent entity, if applicable, any principal, manager or any other cable operator of which any principal or manager of the applicant was or is a principal or manager, has ever been:

1. Found guilty of a criminal proceeding (felonies or misdemeanors) in which any of the following offenses have been charged: fraud, embezzlement, tax evasions, bribery, extortion, jury tampering, obstruction of justice (or other misconduct affecting public or judicial officers in the performance of their duties), false/misleading advertising, perjury, antitrust violations (state or federal), violations of FCC regulations, or conspiracy to commit any of the foregoing;

2. A party to a civil proceeding in which he was held liable for any of the following, or is now a party to any such proceedings: unfair or anticompetitive business practice, antitrust violations (state or federal) including instances in which consent decrees were entered, violations of securities laws (state or federal), false/misleading advertising, violations of FCC regulations, racketeer influences and corrupt organizations, or contraband forfeitures;

3. Subject to any penalty, criminal or civil, involving failure to comply with the requirements of a cable television franchise;

4. Involved in instituting legal action against its franchising authorities; or

5. Involved in revocation/nonrenewal of any other franchises.

(3) Financial information shall include a current financial statement of the applicant which has been audited by a certified public accountant. Included shall be a balance sheet, profit and loss statement for at least the three most recent years, and a statement of changes in financial position, if in existence for less than three years, for such period of existence.

(4) Describe in detail the financing plan for the construction and initial operation of the proposed cable television system and proof of financial capability. Proof of financial capability shall include:

a. A showing of sources and amount of equity capital; if equity contribution is borrowed, describe collateral and terms of the loan;

b. A showing of sources and amount of debt capital, both primary and secondary; and

c. Terms of financing.

(5) Supply documentation that demonstrates and insures the applicant's financial viability, such as:

a. Letters of commitment from financial institutions which demonstrate the availability of sufficient funds to complete construction of the proposed system. Commitments conditional on the obtaining of the franchise are acceptable.

b. If the applicant is a multiple system operator, give evidence of the portion of the company's sources of financing which is uncommitted and will be applied to the proposed construction and operation of the system.

c. State the amount of equity contribution, plus the method by which the contribution is paid (i.e., cash, cash plus credit, services, etc.). Include financial commitment documentation for each investor.

d. If the applicant is a division or subsidiary of a multiple operator, provide the proposed debt instrument describing terms of payment, and/or other documentation showing funds committed to the applicant.

e. If capital is to be raised or supplied by a parent company or other entity, provide an annual report for the parent entity, or equivalent information if an annual report is not prepared for the parent entity.

f. Describe sources and documentation evidencing debt financing.

g. The applicant will be required to authorize release of financial information to the city from financial institutions relating to information supplied by the applicant in support of the application.

(6) Provide pro forma financial statements. Pro forma financial statements are required for a minimum of five years beginning with the date the franchise agreement is accepted, projected annually through the year the applicant anticipates that all financing obligations and debts will have been retired. Such pro formas shall include income statements supported by realistic levels of subscriber penetration, including the source of the information and basis for the projection. Sources and uses of funds, loan amortization information, anticipated capital expenditures, construction costs, depreciation schedules, and operating expenses shall be provided and the basic assumptions relied upon shall be detailed to support its projections. The information and assumptions shall include financial aspects of miles to be built and types of installation (aerial/underground), building schedule, headends, other capital investments and planned coverage; debt, debt equity ratio, debt service costs; depreciation; operating costs in detail; assumed market penetration rate; expected internal rate of return; discuss fixed and variable costs; and such other relevant information as the city deems appropriate.

(7) Provide a construction schedule, describe type and placement of construction, detail phases of construction, and include a map correlated to the phases of construction. Include copies of any agreement with utility companies for the use of any facilities including, but not limited to, poles, lines and conduits.

(8) Proposed rates and charges to be charged subscribers; indicate the extent to which the franchisee proposes to utilize bulk rate contracts, promotional considerations, or lock box charges and other charges, if any.

(9) Description of system configuration, programming and equipment to include:

a. A technical schematic of the system that will be used to provide coverage to the service area.

b. An itemized list of the electronic equipment to be used, channels to be provided, pay TV or additional services; indicate channel lineup for basic service and other service tiers (by service tier), and type of converter; include the manufacturer, type and model numbers (aerial and underground, including drops), active electronics including power supplies and standby power systems, and passive electronics; describe the need for and proposed use of converters including an explanation of the conditions under which converters will be furnished.

c. A description of headend design and reception facilities, including make and model numbers of antennas, signal processors, modulators, demodulators, FM processors and status monitoring systems. Indicate whether signal studies or measurement programs have been undertaken in selecting the headend sites and microwave sites, if any.

d. A description of any other headend and/or subscriber terminal equipment that will be or may be installed for pay-per-view service, other interactive services, text display, home security, etc. Give full details of immediate and longterm plans including arrangements actually made.

e. A summary spectrum utilization chart.

f. Make and model number of emergency override system, describe how the system will work, how and from where the system will be activated.

g. A description of equipment for standby power (for headend, transportation and trunk amplifiers); length of time standby power will be provided.

h. A description of equipment to be used for programming any automated channels, including make and model numbers of the equipment.

i. A discussion of channel expansion capability in respect to both the shortterm and longterm, including specific reference to the degree of flexibility available for adapting the system to increasing or changing capacity requirements.

(10) Forecast of number of homes in franchise service area, number of homes to be passed, if different from number of homes in the franchise service area, and projected number of subscribers, market penetration.

(11) Description of technical standards to which the system will conform. Information shall include, but not be limited to: Carrier to noise ratio, composite triple beat, and cross modulation specifications. Provide the calculations supporting these specifications associated with the transmission paths described in subsections (9)a, (9)b and (9)c of this section. All supporting calculations shall be related to full loading of unmodulated television signals. Any enhancements such as HRC channelization, synchronous carriers of FM modulation shall be separately stated.

a. Worst-case satellite received signal to the most distant subscriber, including distribution system and super trunk effects.

b. Worst-case off-air-signal to most distant subscriber, including distribution and super trunk effects.

c. Worst-case most distant institutional originators to most distant subscriber, including upstream path distribution system and longest super trunk effects.

d. Amplifier cascade. Indicate the number of amplifiers, number of miles and type of cable in the longest amplifier cascade in the proposed cable system.

(12) Disclosure of whether the applicant is in process of acquiring other cable systems or businesses which could impact its resources (management and financial) available to construct, upgrade, maintain and operate the franchise. Indicate any plans for future acquisitions within the next two years which could impact the applicant's ability to furnish service.

(13) If a limited partnership, indicate if there are any plans to sell/dissolve the partnership within the term of the franchise.

(14) Indicate provisions for PEG programming. At the minimum, the franchisee shall make available as of the date of initiation of cable services, the capability of broadcasting a tape which a PEG user provides to the franchisee for showing on the system, subject to legislative guidelines dealing with copyright clearances, obscenity provisions and other appropriate areas concerning acceptance of programming for viewing, and within 12 months of initiation of cable services, provide videotaping and editing capabilities for PEG users. To the extent feasible at time of application, describe the facilities, equipment, training for residents, funding and staffing which franchisee will ensure are available for residents of the franchise service area. The program plan should provide for a comprehensive and well-balanced production capability which will enable the user to produce programming in a studio and to videotape productions at remote locations. The program plan shall address, but not be limited to, the following areas:

a. Establishment of a citizens group reflecting the community needs and interests to advise the franchisee and the franchising authority on the utilization of the community access resources.

b. Description of training opportunities for the residents of the area and the staff of the franchising authority.

c. Description of funding sources and available grants for the support of community access programming.

d. Description of an information outreach program for the community regarding community programming opportunities.

e. Description of franchisee's capital financial obligation to support the plan described in this section.

f. Description of facilities, equipment and materials franchisee will ensure are available for use of the residents. Plan may include several phases of commitment and implementation.

g. Provision for a periodic reassessment of community needs and interests, to be conducted within a minimum of three years and a maximum of five years, which will determine whether additional facilities, equipment, materials and/or training opportunities are needed to meet changing community needs and interests during the term of the franchise.

(15) Any other details, statements, information or references pertinent to the subject matter of such application which shall be required or requested by the city or by any provision of law.

(Ord. No. 14(1989), § 2(16.62.020), 6-27-89)

(a) Upon submission of an application, the applicant/franchisee shall pay to the city a nonrefundable franchise processing fee as follows:

(1) Initial grant of franchise or renewal of existing franchise:

a. Franchise area containing less than 1,000 homes: $1,000.00;

b. Franchise area containing 1,001 to 5,000 homes: $2,500.00;

c. Franchise area containing 5,001 to 10,000 homes: $5,000.00; and

d. Franchise area containing 10,001 or more homes: $7,500.00.

If the franchise area contains less than 100 homes, franchisee may receive credit for all or a portion of the processing fee. Such credit shall be applied to franchise fee payments required by section 13.12.810. Granting the credit shall be at the sole discretion of the board and shall be based upon economic and/or technological considerations specific to the franchise area.

(2) Consent to sale, transfer, transfer of stock, assignment, lease, hypothecation or trust of franchise, not requiring modification of the franchise by adoption of an amending ordinance: $1,000.00.

(3) Modification of franchise requested by franchisee requiring the adoption of an amending ordinance: $2,500.00.

(4) Consent to sale, transfer, transfer of stock, assignment or lease, or any other action requiring modification of franchise by adoption of an amending ordinance: $2,500.00.

(5) Modification of franchise resulting from noncompliance with one or more provisions of the franchise which requires the adoption of an amending ordinance: $2,500.00.

(b) The applicant may be required to pay any additional costs incurred by city in the processing of the applicant's request for franchise, renewal, modification, consent to sale, transfer, transfer of stock, assignment, lease, hypothecation or trust of franchise. Such costs may include the costs incurred for hiring consultants to assist in evaluating the application. Such costs shall be paid by the applicant prior to final consideration of the request by the director or the city council, as applicable.

(Ord. No. 14(1989), § 2(16.62.025), 6-27-89)

Upon receipt of an application for franchise, the department shall transmit one copy each thereof to the appropriate city departments.

(Ord. No. 14(1989), § 2(16.62.030), 6-27-89)

Upon receipt of an application for franchise, the commission shall estimate the cost of publication and posting of the notice of hearing, as provided in this division, and shall notify the applicant of the amount thereof. No further action will be taken on the application until the estimated cost of publication and posting has been deposited with the commission by the applicant.

(Ord. No. 14(1989), § 2(16.62.040), 6-27-89)

Upon receipt of the required deposit, the commission shall set the application for a hearing at a time and date approved by the director. Notwithstanding the foregoing, no application for franchise shall be set for hearing unless it contains the information required by section 13.12.330.

(Ord. No. 14(1989), § 2(16.62.050), 6-27-89)

Not less than ten days before the hearing, the commission shall give notice in writing of the time, date and place of hearing to the director, the auditor-controller, and the applicant. The commission shall serve such notice upon the applicant by first class mail, postage prepaid.

(Ord. No. 14(1989), § 2(16.62.060), 6-27-89)

(a) The posted notice of hearing shall state that an application has been made for a cable television franchise for (specify area to be served) and shall contain the following statement:

"Any person having objections to the granting of the franchise for which the application is made, or wishing to suggest any other terms and conditions which should be included in such franchise, may, at any time prior to the date above named, file with the commission in writing, objections or suggestions, or both, giving the reasons therefor, and may appear at the time and place of the hearing to be heard relative thereto."

(b) The notice shall also indicate the address and telephone number of the commission.

(Ord. No. 14(1989), § 2(16.62.070), 6-27-89)

In those places, a minimum of two places, up to and including a maximum of ten places, within the proposed franchise service area to be served which the commission finds will most adequately notify the inhabitants thereof, the commission, not less than five days prior to the hearing, shall post notice of the time, date and place of hearing at each of the selected locations.

(Ord. No. 14(1989), § 2(16.62.080), 6-27-89)

Not less than five days before the hearing, the commission shall publish in a newspaper of general circulation circulated within the area to be served, and pursuant to Government Code § 6061.3, the same notice as is required to be posted.

(Ord. No. 14(1989), § 2(16.62.090), 6-27-89)

If the cost of publication and posting of notice of hearing exceeds the amount deposited by the applicant, the commission shall bill applicant for the deficiency. The applicant shall pay the whole of such bill within 30 days after receipt thereof. If the amount of the deposit exceeds the cost of publication and posting, the city shall refund the difference to the applicant.

(Ord. No. 14(1989), § 2(16.62.100), 6-27-89)

Any person interested, at any time after the filing of an application as provided in this division and prior to the hearing thereon, may file with the commission written protests or suggestions, or both, either against the granting of the franchise or to suggest any terms and conditions which should be included in the franchise. The commission, in considering the application, shall give consideration to all of such protests and suggestions.

(Ord. No. 14(1989), § 2(16.62.110), 6-27-89)

At the time and place set for the hearing or at the time and place to which the hearing may be continued by the commission, the commission shall hear the applicant, who may present any evidence to show why the franchise should be granted, why certain terms or conditions should be imposed or not imposed on such franchise, if granted, and also shall hear testimony or statements of other persons who may attend the hearing and present reasons why the application should be denied, or why, if granted, the franchise should or should not be subject to certain conditions.

(Ord. No. 14(1989), § 2(16.62.120), 6-27-89)

Within 30 days after the close of the hearing, and based upon the evidence received at the hearing and other matters which the commission is required to consider, the commission shall file with the city council its recommendations as to whether or not the application should be granted and, if granted, subject to what conditions. The commission shall send a copy of its recommendations to the applicant, the director, the auditor-controller, and the director of public works.

(Ord. No. 14(1989), § 2(16.62.130), 6-27-89)

Upon receipt of the recommendations of the commission, the city council may take any one of the following actions:

(1) The action recommended by the commission;

(2) Refer the matter back to the commission with or without instructions;

(3) Require a transcript of the testimony and any other evidence received by the commission and take such action as in its opinion is indicated by the evidence; or

(4) Set the matter for public hearing before itself. Such public hearing shall be held de novo as if no hearing previously had been held.

(Ord. No. 14(1989), § 2(16.62.140), 6-27-89)

In the case of an application for a license agreement to construct and maintain a portion of a cable television system along, over, across or under public rights-of-way to extend cable television services to a franchise granted by one or more franchising authorities, the applicant shall pay a license agreement processing fee of $1,000.00. The applicant may be required to pay any additional costs incurred by the city in the processing of the applicant's request for a license agreement. Such costs may include the costs incurred for hiring consultants to assist in evaluating the application for a license agreement.

(Ord. No. 14(1989), § 2(16.62.150), 6-27-89)

The director may execute license agreements for the use of county roads and county easements by cable television systems operating within the city which do not exceed 15 years in term.

(Ord. No. 14(1989), § 2(16.62.160), 6-27-89)

(a) When franchisee makes application for a franchise or renewal of a franchise, and there exists an area or areas adjacent to the requested franchise service areas, which at the time of application have not reached sufficient development or density of population to require the provision of cable services within three years of the granting of the franchise or renewal, but for which it is anticipated that such development or density will occur within the term of the franchise, the franchisee may include in the application a request for such areas to be included as line extension areas. The application shall include a map on which the line extension areas are indicated.

(b) The director shall have the authority to grant one or more line extensions during the term of the franchise. As a condition to the granting of the extension of cable service to the line extension areas, the director may impose additional terms and conditions upon the franchise which the director may deem to be in the public interest.

(c) At such time as the franchisee determines that the line extension areas have developed sufficiently to warrant the extension of cable services, the franchisee shall apply to the director for approval to extend cable services. The application shall include, but not be limited to, a map of the areas to be constructed, a construction schedule, an estimate of construction costs, a copy of the complaint record as identified in section 13.12.1390(d), and other applicable information required by the director.

(d) After approval to proceed with the line extensions, and upon notification by the franchisee that construction of the areas has been completed, the areas shall be considered a part of the franchise service areas, as if originally granted in the ordinance granting the franchise, and the term of the franchise for such extension areas shall expire when the term of the original franchise areas expires. The director shall issue written notice to the franchisee that the areas shall thereafter be considered as if a part of the original franchise service area. A copy of the notice shall also be filed with the city council for its records.

(e) The franchisee shall provide to any areas constructed under the line extension policy the same services at the same rates by the franchisee as the franchisee provides to those service areas in the original franchise service areas, as set forth in section 13.12.1210.

(Ord. No. 14(1989), § 2(16.62.180), 6-27-89)

(a) During the life of the franchise, should the franchisee determine that any undeveloped areas not included in the original franchise application as line extension areas reach sufficient development to warrant the extension of cable services, the franchisee shall apply to the director for approval to extend cable services to such new extension areas. At the director's sole option, the director may elect to refer the application to the city council or the commission for action on the request.

(b) An application shall be submitted to the director which shall include, but not be limited to, maps of the areas to be constructed, an estimate of the number of homes in the areas, a construction schedule, an estimate of construction costs, a copy of the complaint record as identified in section 13.12.1390(d), and other applicable information required by the director. The application shall be accompanied by a processing fee, in an amount determined according to the requirements of section 13.12.340, based on the homes contained in the newly requested areas.

(c) As a condition to the granting of the extension of cable service to the requested extension areas, the director or city council or commission, as applicable, may impose additional terms and conditions upon the franchise which the director or city council or commission, as applicable, may deem to be in the public interest.

(d) Upon the director's or commission's or city council's determination to consent to the request to add new extension areas to the franchise, the director shall issue written notice to the franchisee. Such written notice shall include maps and legal descriptions of the new extension areas. A copy of the notice shall also be filed with the city council for its records.

(e) Any such new extension areas shall be considered a part of the franchise service areas as if originally granted in the ordinance granting the franchise, and the term of such new extension areas shall expire when the term of the original franchise areas expires.

(f) The franchisee shall provide to any areas constructed under this section the same services at the same rates as franchisee provides to those service areas in the original franchise areas, as set forth in section 13.12.1210.

(g) The director shall advise the city council and the commission on a semiannual basis of the status of all new extensions granted during the preceding period.

(Ord. No. 14(1989), § 2(16.62.190), 6-27-89)

(a) By acceptance of a franchise granted by the city, the franchisee understands and shall agree that failure to comply with any time and performance requirements as stipulated in this chapter and the ordinance granting the franchise (franchise agreement) will result in damages to the city and that it is and will be impractical to determine the actual amount of such damage in the event of delay or nonperformance. Each of the amounts set forth in this section has been set in recognition of the difficulty in affixing actual damages arising from breach of the franchise agreement. The franchise agreement may include provisions, where applicable, for liquidated damages to be paid to the city by the franchisee, in the following amounts, or amounts set forth in the franchise agreement, and chargeable to the letter of credit or security fund, should the franchisee not make payment within 30 days of written notice by the city that the following amounts are due for the following concerns:

(1) Failure to complete system construction in accordance with the franchise agreement, unless the director approves the delay due to the occurrence of conditions beyond the franchisee's control: $500.00 per day for each day, or part thereof, that the deficiency continues.

(2) Failure to provide data, documents, or reports within ten days after a written request, or within such longer time as may be specified in the request: $50.00 per day for each day, or part thereof, that each violation continues.

(3) Failure to test, analyze and report on the performance of the system following a written request pursuant to the franchise agreement within such time as may be specified in the request: $100.00 per day for each day, or part thereof, that such noncompliance continues.

(4) Failure to provide in a continuing manner the type of services proposed in the franchisee's application as incorporated into the ordinance granting the franchise, unless the director approves a delay or change, or the franchisee has obtained a modification of its obligation under section 625 of the Cable Act: $500.00 per day for each day, or part thereof, that each noncompliance continues.

(5) Failure to construct cable system to an area meeting the density requirements following a written request therefor, within such time as may be specified in the request: $100.00 per day for each day, or part thereof, that each noncompliance continues.

(6) Failure to provide required notices to subscribers: $1.00 per subscriber per month for each month, or part thereof, that each noncompliance continues.

(7) Failure to provide current evidence of insurance and bonding: $100.00 per month for each month, or part thereof, that each noncompliance continues. Nothing in this section shall preclude immediate termination or suspension of franchise, as provided for under section 13.12.180 for franchisee's failure to procure or maintain the required insurance and bonding.

(8) Nothing in this section shall preclude further liquidated damages as agreed upon by the parties in the franchise agreement.

(b) If the director determines that the franchisee is liable for liquidated damages, the director shall issue to the franchisee by certified mail written notice of intention to assess liquidated damages. Assessments shall begin to accrue as of the date of the written notice and as set forth in the notice. The notice shall set forth the basis for the assessment and give the franchisee a reasonable time in which to remedy the violation.

(c) The franchisee shall have the right to appeal any notice to the director, by certified mail, within 15 days of receipt of notice. The director shall hold an administrative hearing within 60 days of receipt of an appeal. The director's decision shall be final.

(d) If the franchisee does not appeal the notice within the 15-day period, the franchisee shall pay the amounts of liquidated damages as indicated in the notice. If payment is not paid, as provided for in this section, the city may draw against the letter of credit or security fund in the specified amounts.

(Ord. No. 14(1989), § 2(16.60.157), 6-27-89)

(a) The franchise is granted and shall be held and enjoyed upon each and every condition contained in the ordinance granting the franchise and each and every condition contained in this chapter, and shall ever be strictly construed against the franchisee.

(b) In addition to all other rights and powers retained by the city under this chapter or otherwise, the city reserves the right to suspend or revoke and terminate a franchise and all rights and privileges of a franchisee in the event of a material breach of its terms and conditions. In interpreting this section, material provisions shall include all labeled as such and all others, which, under all the facts and circumstances indicated, are a significant provision of the franchise agreement. A material breach by the franchisee shall include, but shall not be limited to, the following:

(1) Violation of any material provision of the franchise or any material rule, order, regulation or determination of the city made pursuant to the franchise;

(2) Attempt to evade any material provision of the franchise or practice any fraud or deceit upon the city or its subscribers or customers;

(3) Failure to begin or complete system construction, reconstruction or system extensions as provided under the franchise;

(4) Failure to provide the types of facilities, equipment or services promised; and

(5) Material misrepresentation of fact in the application for or negotiation of the franchise.

The foregoing shall not constitute a material breach if, in the opinion of the city council, the violation occurs without fault of the franchisee or occurs as a result of circumstances beyond its control. The franchisee shall not be excused by mere economic hardship nor by misfeasance or malfeasance of its shareholders, directors, officers or employees.

(c) The director, prior to any suspension or revocation and termination of the franchise, shall give to the franchisee not less than ten days' notice in writing of any default thereunder. If the franchisee does not within the noticed period begin the work of compliance or, after such a beginning, does not prosecute the work with due diligence to completion, the city council shall hold a hearing, at which the franchisee shall have the right to appear and be heard. Notice of the hearing shall be given to the franchisee by certified mail not less than ten days before the hearing.

(d) Upon the conclusion of the hearing, the city council may determine whether such conditions are material and essential to the franchise and whether the franchisee is in default with respect thereto and may declare the franchise suspended or revoked and terminated. No revocation and termination shall become effective less than 30 days after the council's declaration to revoke and terminate; and no lapse of time, expenditure or any other thing shall be deemed to give the franchisee any vested right or interest in the continuation of the franchise granted.

(Ord. No. 14(1989), § 2(16.60.160), 6-27-89)

The franchisee shall pay the costs incurred by the city for any technical assistance deemed necessary by the city for obtaining independent verification of technical compliance with all franchise imposed standards.

(Ord. No. 14(1989), § 2(16.60.165), 6-27-89)

(a) The franchisee shall not sell, transfer, assign, lease, hypothecate, place in trust or change the control of the franchise or any part thereof, except with the prior consent of the director, and after payment of the fees required by section 13.12.340. Director's consent shall not be unreasonably withheld. As used in this section, the word "transfer" includes stock transfer and the word "control" includes actual working control in whatever manner exercised.

(b) The franchisee shall inform the director of any pending sale, transfer, lease, assignment, hypothecation, placing in trust or change in control, except as excluded in subsection (e) of this section. The transferor and transferee must file an application for the director's consent to transfer control of or assign the franchise as set forth in subsections (g) and (h) of this section. Such applications shall be accompanied by the fees required in subsection 13.12.340(a) and shall be signed by duly authorized representatives and the signature acknowledged by a notary.

(c) The franchisee shall file with the director a certified copy of the duly executed instrument of such sale, transfer, assignment, lease, hypothecation, trust or change in control within 30 days of the effective date of such sale, transfer, assignment, lease, hypothecation, trust or change in control. If such duly executed instrument is not filed with the director within 30 days after the effective date of such sale, transfer, assignment, lease, hypothecation, trust or change in control, then upon the expiration of 30 days, the franchise shall be subject to forfeiture and the city council may, without notice, by ordinance repeal the franchise.

(d) As a condition to the granting of consent to such sale, transfer, assignment, lease, hypothecation, trust or change in control, the city council may impose such additional terms and conditions upon the franchise and upon the grantee or assignee which the director recommends or the city council deems to be in the public interest. Such additional terms and conditions shall be expressed by ordinance. Nothing contained in this section shall be construed to grant to the franchisee the right to sell, transfer, assign, lease, hypothecate, place in trust or change control of the franchise or any part thereof, except in the manner described in this section. This section applies to any assignment, whether by operation of law, by voluntary act of the franchisee, or otherwise.

(e) Shareholders and/or partners of the franchisee may transfer, sell, exchange, assign or divest themselves of any interest they may have therein. However, if any such sale, transfer, exchange, assignment, divestment or other change is effected in such a way as to give control of or 25 percent or more interest in the franchisee to any persons, corporation, partnership or legal entity other than the controlling interest therein on the effective date of the franchise or the effective date of the last assignment, sale, transfer, or other action which required the city council's or director's consent, consent thereof shall be required.

(f) Consent to any such transfer shall only be refused if the director finds that the franchisee is in noncompliance with terms and conditions of the franchise and/or that the transferee is lacking in experience and/or financial ability to operate the cable television system authorized by the franchise.

(g) The transferor's (assignor's) application shall include:

(1) Identification and ownership of transferee. In its application for consent, transferor shall identify the transferee and its ownership in the same detail as if the transferee were an applicant for an initial grant.

(2) A copy of the complaint record as identified in subsection 13.12.1390(d).

(3) Financial statements. Current financial statements showing the financial condition of the franchise as of the date of the application. The transferor shall also agree to submit financial statements showing the condition of franchise as of the closing. Such financial statements shall have been audited and certified by an independent certified public accountant, and shall be submitted within 90 days of the closing.

(4) The submittal of a final accounting and report of franchise fees set forth in division 3 of this chapter within 30 days of the effective date of approval of transfer/assignment of the franchise, or of the date of close of the transfer/assignment. The transferee shall be responsible for any underpayment, and shall be entitled to a credit for any overpayment.

(h) The transferee's (assignee's) application shall include:

(1) A specific and complete response to the criteria set forth in section 13.12.330 in as complete a form as if the transferee were applying for an initial franchise.

(2) Current financial statements of the proposed transferee and other such information and data, including, but not limited to, sources of capital, as will demonstrate conclusively that the transferee has all the financial resources necessary to acquire the cable television system, carry out all of the terms and conditions of the franchise, remedy any and all defaults and violations of the provisions of this division and of the ordinance granting the franchise in the transferor's past and present operations, make such other improvements and additions as may be required or proposed in the services and facilities, including, but not limited to, upgrading, rebuilds, and extensions of facilities and equipment.

(3) A statement of any changes in rates and charges which the transferee proposes to make during the first three years following approval of the transfer or assignment.

(4) An express and unconditional written acceptance of the terms and conditions of the existing franchise, and the franchise, as modified, as a condition to the transfer, accompanied by such guarantees as meet the requirements of subsections 13.12.130(b) and (c).

(5) A summary of the plans and commitments of the transferee to remedy the specific defaults and violations, if any, in the operations of the cable operator (transferor) under the existing franchise.

(Ord. No. 14(1989), § 2(16.60.170), 6-27-89)

If a franchisee acquires an additional franchise which results in the overlapping in whole or in part of any franchise service areas, the director shall determine which of the two franchises shall prevail as to the overlapping areas, and the franchise service area granted in the nonprevailing franchise shall be reduced by ordinance to delete the overlapping areas.

(Ord. No. 14(1989), § 2(16.60.175), 6-27-89)

(a) The franchisee, during the term of the franchise, within 60 days after the expiration of each calendar year, shall file with the county auditor-controller and the department, one copy to each, of a report verified by the oath of the franchisee, or by the oath of a duly authorized representative of the franchisee, setting forth in detail the computation of the amount of the franchise payment due for the immediately preceding calendar year. For each physically separate transmission and distribution system, any portion of which is located within the franchise area, the report shall contain:

(1) A detailed profit and loss statement showing all gross receipts and expenses derived from the franchisee's franchise operations during the reporting period.

(2) The total number of service connections in operation as of the last day of the calendar year.

(b) The franchisee shall also provide, on request, such additional data as is reasonably necessary in the opinion of the county auditor-controller to calculate or verify the calculation of the annual payment required by section 13.12.810.

(Ord. No. 14(1989), § 2(16.60.180), 6-27-89)

The franchisee shall file with director or department, as applicable, the following reports:

(1) An annual cable report, including, but not limited to, an annual status report, and a construction report, if applicable, in a form prepared by the director, to the department on or before January 31 of each year, or as determined by the department. The franchisee shall include a copy of the most recent annual equal employment opportunity report filed pursuant to section 634 of the Cable Act.

(2) Other reports, documents, data and annual proof of performance as deemed necessary by director for the administration and review of the franchisee's performance under the terms and conditions of the franchise.

(3) Within 60 days of the effective date of the ordinance granting the franchise, the franchisee shall begin submittal to the department of a monthly construction activity report reflecting the construction status for the preceding month. The report shall include the status of permits, number of miles constructed, number of homes passed, any conditions which may affect the construction schedule, and any other information required by the director. Unless otherwise instructed by the director, such monthly reports will be required until the completion of construction activities.

(4) After the completion of initial construction, at such times as construction or reconstruction activities are undertaken during the term of the franchise, the franchisee shall be required to submit quarterly construction reports containing the information required in subsection (3) of this section.

(Ord. No. 14(1989), § 2(16.60.182), 6-27-89)

The franchisee, during the term of the franchise, within 60 days after the expiration of each calendar year, shall:

(1) File a report with the director of public works, which shall contain a street and highway map of any convenient scale on which shall be plotted the location of the headend facilities and the entire transmission and distribution system covered by the report as of the last day of the franchise payment period, with all that part of the system located in county highways indicated by distinctive coloration or symbols. The submission of this map for general reference purposes shall not relieve franchisee of the obligation to file with the director of public works the more detailed map required by section 13.08.130, as incorporated by reference in this section. The franchisee shall also provide on request such additional data as is reasonably necessary in the opinion of the county auditor-controller to calculate or verify the calculation of the annual payment required by section 13.12.820.

(2) File with the director of public works a report in duplicate showing:

a. The permit number of each permit obtained for the doing of any work under the franchise for which a permit is required during the immediately preceding franchise report period; and

b. The lineal length of lines and cables installed pursuant to each permit during the immediately preceding franchise report period.

(Ord. No. 14(1989), § 2(16.60.185), 6-27-89)

(a) The franchisee shall indemnify and hold the city harmless from and against any and all loss, damages, liability, claims, suits, costs and expenses, including reasonable attorneys' fees, regardless of the merit or outcome of any such claim or suit, claimed or arising from any negligent or intentional act or omission of the franchisee, its officers, employees, agents or subcontractors, arising from activities or work conducted pursuant to the franchise.

(b) The franchisee shall indemnify, defend and save harmless the city, its officers, agents and employees, from and against any and all claims and losses whatsoever, including reasonable attorneys' fees, accruing or resulting to any and all persons furnishing or supplying work, services, materials, equipment or supplies in connection with activities or work conducted or performed pursuant to the franchise and arising out of such activities or work, and from any and all claims and losses whatsoever, including reasonable attorneys' fees, accruing or resulting to any person for damage, injury or death arising out of the franchisee's franchise operations.

(Ord. No. 14(1989), § 2(16.60.190), 6-27-89)

In addition to the provisions of section 13.12.540, any time a franchisee applies for a change in territory, service area, or bonding, the city council may impose such additional terms and conditions upon the franchisee and upon the grantee or assignee which the city council may deem to be in the public interest. Such additional terms and conditions shall be expressed by ordinance.

(Ord. No. 14(1989), § 2(16.60.200), 6-27-89)

Notwithstanding the granting of a franchise, the franchisee shall not be authorized to do any work under the franchise for which the issuance of a permit is required unless such a permit is issued for such work. Additional bonding, certificates of deposit, evidences of insurance or other documentation may be required by other city departments prior to the issuance of such permits. The franchisee shall not have an absolute right to the issuance of such a permit.

(Ord. No. 14(1989), § 2(16.60.210), 6-27-89)

Unless the ordinance granting the franchise provides otherwise, the franchise shall authorize the exercise of the rights and privileges granted by the franchise in the service areas, highways, public properties and public easements as may be described in the ordinance granting the franchise and such additional service areas, highways, public properties and public easements as may from time to time be approved by the city council.

(Ord. No. 14(1989), § 2(16.60.220), 6-27-89)

(a) The city, or its successor in authority, upon termination or forfeiture of the franchise, or at any time during the term of the franchise and, after five years from the effective date of the ordinance granting the franchise, shall have the option to purchase all or part of the franchise property, upon making reasonable compensation therefor. The city's right to purchase the franchise property under this chapter shall not be construed as a waiver of any other rights the city may have. If the city elects to purchase the franchise property in accordance herewith, the compensation shall be computed as provided in Code of Civil Procedure § 1263.310 et seq.; provided further that such purchase shall be at an equitable price, which shall not include compensation for loss of good will or any valuation of the franchise itself or of any of the rights or privileges granted by the franchise. Other terms and conditions of the sale shall be mutually agreed upon by the parties.

(b) Notwithstanding the provisions of subsection (a) of this section, in the case of any franchise granted after December 29, 1984, if a renewal of such franchise is denied, any acquisition of the cable system by the city shall be at fair market value, determined on the basis of the cable system valued as a going concern but with no value allocated to the franchise itself.

(c) If the franchise is revoked and terminated and the city elects not to purchase the franchise property hereunder, the franchisee agrees to waive all claims for damages or compensation which it may have against the city as a result of such revocation and termination; provided, however, that the franchisee does not hereby waive its rights to a judicial determination of the validity of such revocation and termination.

(Ord. No. 14(1989), § 2(16.60.230), 6-27-89)

The franchisee shall not make any discrimination, distinction or restriction on account of color, race, religion, sex, ancestry or national origin contrary to the provisions of Civil Code § 51, which is incorporated in this section by reference. All applicable provisions of Government Code §§ 12900—12996 (California Fair Employment and Housing Act) are hereby incorporated in this section by reference. The franchisee further agrees to comply with applicable antidiscrimination provisions of section 634 of the Cable Act.

(Ord. No. 14(1989), § 2(16.60.240), 6-27-89)

(a) In cases of new construction or property development where utilities are to be placed underground, the franchisee shall, if practical, install underground cable at the same time and in the same trenches as the public improvements (e.g., communications, electric, gas, water) are installed.

(b) If the franchisee is notified of the date the trenches are available and fails to install its conduit and/or cable within five working days of the date the trenches are available, and the trenches are thereafter closed after the five-day period, the cost of new trenching is to be borne by the franchisee.

(c) The requirements of subsections (a) and (b) of this section shall not apply unless the property owner offers the franchisee the same terms with respect to availability and cost of trenching for undergrounding as are offered to other trench users, if any.

(d) If a subdivider, property developer or an entity owned by, associated with or under the control of a subdivider or developer has a franchise to provide cable services to an area including its property developments, the franchisee shall be required to make access to the utility trenches in the developments available to all franchisees authorized to provide cable services to an area including the developments. Access shall be provided at the same terms with respect to availability and cost of trenching for undergrounding as is provided to other trench users, if any.

(Ord. No. 14(1989), § 2(16.60.250), 6-27-89)

The franchisee shall not be excused from complying with any of the requirements of the ordinance by any failure of the city on any one or more occasions to insist upon or seek compliance with any such terms or conditions.

(Ord. No. 14(1989), § 2(16.60.260), 6-27-89)

At any time during the initial franchise term, but no later than 36 months prior to the expiration of the initial franchise term, the city and the franchisee may agree to renegotiate all or any part of the franchise. The franchisee shall submit a copy of the complaint record as identified in section 13.12.1390(d). As a result of such negotiation, the city council may grant by ordinance an extension of the franchise term for a period of up to 15 years, subject to the franchisee's agreement to comply fully with the franchise and all amendments or other modifications to the franchise as may be agreed upon by the parties. The provisions of division 6 of this chapter shall not apply to this section.

(Ord. No. 14(1989), § 2(16.60.270), 6-27-89)

It shall be unlawful for any person to make or use any unauthorized connection, whether physically, acoustically, inductively or otherwise, with any part of a cable television system for which a franchise has been issued, for the purpose of taking or receiving or enabling himself or others to receive or use any television signals, radio signals, picture, program or sound, without payment to the owner of the system.

(Ord. No. 14(1989), § 2(16.60.280), 6-27-89)

It shall be unlawful for any person, without the consent of the owner, to wilfully tamper with, remove, injure or vandalize any part of such a cable television system including any cables, wires or equipment used for distribution of television signals, radio signals, pictures, programs or sound.

(Ord. No. 14(1989), § 2(16.60.290), 6-27-89)

Enforcement of sections 13.12.680 and 13.12.690 shall be according to appropriate federal, state or local law.

(Ord. No. 14(1989), § 2(16.60.295), 6-27-89)

If any provision of the franchise or the application of the franchise to any person or circumstance is held invalid by a court of competent jurisdiction or is not in compliance with any requirement of the Public Utilities Commission of the state, the Federal Communications Commission, or any other federal or state body or agency having jurisdiction over the franchisee's franchise activities, the remainder of the franchise, or the application of the franchise to persons or circumstances other than those to which it is held invalid or not in such compliance, shall not be affected thereby.

(Ord. No. 14(1989), § 2(16.60.300), 6-27-89)