Gilroy Municipal Code Art. XIII Franchises

Any person, firm or corporation furnishing the City or its inhabitants with any public utility or public utility service, or using the public streets, ways, alleys or places, as the same now or may hereafter exist, in connection therewith, may be required by ordinance to have a valid and existing franchise.

The Council, by ordinance, shall prescribe the terms and conditions under which franchises will be granted, subject to the provisions of this Charter, and the procedure for granting franchises; provided, however, that such procedural ordinance or ordinances shall make provisions for the giving of public notice of franchise applications, for protests against the granting of such franchises and for public hearings on such applications. Until the adoption of such a procedural ordinance the method provided by any law of the State relative to the granting of a franchise of the character of that for which application is being made, shall apply.

The Council, in granting franchises, shall prescribe the terms and conditions of such franchises in accordance with the applicable provisions of this Charter and any ordinance adopted pursuant thereto, and may in such franchise impose such other and additional terms and conditions not in conflict with said Charter or ordinances, whether governmental or contractual in character, as in the judgment of said Council are in the public interest or as the people, by initiative, indicate they desire to have imposed.

Every franchise shall state the term which it is granted, which, unless it be indeterminate as provided for herein, shall not exceed 25 years.

A franchise grant may be indeterminate; that is to say, it may provide that it shall endure in full force and effect until the same, with the consent of the Public Utilities Commission of the State of California, shall be voluntarily surrendered or abandoned by its possessors, or until the State of California, or some municipal or public corporation, thereunto duly authorized by law, shall purchase by voluntary agreement or shall condemn and take, under the power of eminent domain, all property actually used and useful in the exercise of such franchise and situate within the territorial limits of the State, municipal or public corporation purchasing or condemning such property, or until the franchise shall be forfeited for non-compliance with its terms by the possessor thereof.

No franchise grant shall in any way, or to any extent, impair or affect the right of the City to acquire the property of the grantee either by purchase or through the exercise of the right 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 right of eminent domain with respect to any public utility.

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 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 liability 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 viaduct, or if the public health, comfort, welfare, convenience, or safety so demands; and

(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 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 therefore, 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.

Nothing in this Article shall be construed to apply to the City, or any department thereof, when furnishing any public utility or service.

Nothing contained in this Article shall be construed to affect or impair any rights, powers or privileges relating to franchises vested in, possessed by or available to the City by virtue of previous Charter provisions.