Downey Municipal Code Art. XIV Franchises

The Council may grant a franchise to any person, partnership, corporation, or other legal entity capable of exercising the privilege conferred, whether operating under an existing franchise or not, and may prescribe the terms, conditions, and limitations of such grant, including the compensation to be paid in the City therefor. The Council may prescribe by ordinance or resolution the method or procedure for granting franchises, together with additional terms and conditions for making such grants. In the absence of such provision the method provided by State law shall apply.

Nothing in this Section, or elsewhere in this Article, shall apply to the City, or to any department thereof, when furnishing any utility service.

Every franchise granted for a longer period than 25 years shall reserve to the City the right to take over at any time after the grant, the works, plant, and property constructed under the grant at their physical valuation and without compensation for any value attributed to the franchise or any claim for loss of business good will.

No franchise grant shall in any way, or to any extent, impair or limit the power of the City to acquire the property of the grantee thereof either by purchase or through the exercise of the power of eminent domain, and nothing herein contained shall be construed to contract away or to modify or to abridge, either for a term or in perpetuity, the City's power of eminent domain with respect to any public utility. Every franchise granted by the City is granted upon the condition, whether expressed in the grant or not, that such franchise shall not be given any value before any court or other public authority in any proceeding of any character in excess of any amount actually paid by the grantee to the City at the time of the grant.

Before granting any franchise, the City Council shall adopt a resolution declaring its intention to grant same and stating the name of the proposed grantee, the character of the proposed franchise, and the terms and conditions upon which it is proposed to be granted. Such resolution shall fix and set forth the day, hour, and place when and where any person having an interest in or any objecting to the granting of such franchise may appear before the Council and be heard. Said resolution shall be published at least once, not less than ten days prior to said hearing, in the official newspaper. In the event there is no newspaper published in the City, then said resolution shall be posted in three public places in the City at least 15 days before said hearing. This posting is in addition to publication in a newspaper used by the City for legal notices. After hearing all persons desiring to be heard, the Council may by ordinance deny or grant the franchise on the terms and conditions specified in the resolution. No ordinance granting a franchise shall be adopted as an emergency ordinance.

Every application for a franchise shall be accompanied by a cash deposit or certified check in an amount to pay in full all costs of advertising and other preliminary expenses connected with the offering for sale of such franchises and the granting of same, which deposit shall not be less than $100. Said deposit shall be returned in case the Council shall determine that neither the public necessity nor the public interest required the granting of the franchise, or in case the franchise be granted to a person other than said applicant. The cost of advertising and other costs hereinabove referred to connected with the offering for sale and granting of said franchise, and such payment shall be a condition precedent to the vesting of the franchise.

By its acceptance of any franchise hereunder, the grantee shall covenant and agree to perform and be bound by each and all of the terms and conditions imposed in the grant, or by procedural ordinance and shall further agree to:

(a) Comply with all lawful ordinances, rules and regulations theretofore or thereafter adopted by the City Council in the exercise of its police power governing the construction, maintenance and operation of its plants, works or equipment.

(b) Pay to the City on demand the cost of all repairs to public property made necessary by any of the operations of the grantee under such franchise.

(c) Indemnify and hold harmless the City and its officers from any and all liabilities for damages proximately resulting from any operations under such franchise.

(d) Remove and relocate without expense to the City any facilities installed, used and maintained under the franchise if and when made necessary by any lawful change of grade, alignment or width of any public street, way, alley or place, including the construction of any subway or elevated transit facilities, or if the public health, comfort, welfare, convenience, or safety so demands.

(e) Pay to the City during the life of the franchise a percentage, to be specified in the grant, of the gross annual receipts of the grantee within the limits of the City, or such other compensation as the City Council may prescribe in the grant.

The exercise by any person, firm or corporation of any privilege for which a franchise is required, without possessing a valid and existing franchise therefor, shall be a misdemeanor and shall be punishable in the same manner as violations of this Charter are punishable and each day that such condition continues to exist shall constitute a separate violation.