Lake Forest Municipal Code Ch. 14.48 Public Franchises

It is the purpose and intent of the City Council of the City of Lake Forest by enacting this chapter to establish nondiscriminatory procedures for the granting of franchises to use and occupy the public rights-of-way. The City has the authority to manage public property through its police power, charter, and other statutory and Constitutional powers granted to municipalities. The authority and procedures contained herein are intended to ensure that applicants seeking to occupy the public right-of-way for commercial purposes are treated fairly with sufficient consideration for due process, and that the City's responsibility to control and demand a fair rate of compensation for the public for such use is preserved.

(Ord. 165 § 1, 2007)

"Exclusive franchise"

means a franchise for a term of years which grants privileges available to one and only one franchisee within the boundaries and services defined by the franchise agreement for the duration of the franchise.

"Franchise"

means and includes any authorization granted hereunder in terms of franchise, privilege, or otherwise to erect, construct, install, operate, or maintain a facility for commercial purposes by occupying the public right-of-way within all or a specified area in the City. Any such authorization shall not mean or include any license or permit required for the privilege of transacting and carrying on a business within the City generally as required by other ordinances and laws of this City.

"Franchise agreement"

means a negotiated agreement between the franchisee and the City which sets forth the terms and conditions of the grant of franchise.

"Franchisee"

means the person, firm, or corporation granted a franchise by the City Council under this chapter, and the lawful successor, transferee, or assignee of such person, firm, or corporation.

"Nonexclusive franchise"

means a franchise which grants privileges available to multiple simultaneous franchisees within the boundaries and services defined by the franchise.

"Right-of-way"

means any public highway, public street, public way, or public place in the City, either owned by the City or dedicated to the public for public purposes.

(Ord. 165 § 1, 2007)

The City Council of the City of Lake Forest shall have the authority to grant a franchise, whether exclusive or nonexclusive, to erect, construct, install, operate, or maintain a facility for commercial purposes by occupying the public right-of-way as approved by the City Council and subject to the terms and conditions of this chapter and any franchise agreement executed between the City and the franchisee. Further, the City of Lake Forest shall have the authority to require reasonable consideration in the form of a franchise fee for the privilege granted by any franchise in accordance with this chapter.

(Ord. 165 § 1, 2007)

A. Following the effective date of the ordinance codified in this chapter, no person shall erect, install, or construct any permanent facility for commercial purposes within the public right-of-way unless the person has first obtained a franchise for such use granted by the City Council under such terms and restrictions as are set forth herein.

B. No person shall operate or maintain a permanent facility for commercial use which is erected, installed, or constructed within the public right-of-way following the effective date of said chapter unless the person has first obtained a franchise for such use pursuant to the provisions of this chapter or has obtained some other specific grant of authority from the City for the use of the public right-of-way.

C. The procedures set forth herein shall not be applied to any facility, or the operation and maintenance of any facility, which is now or hereafter otherwise specifically authorized to locate in the public right-of-way by Federal, State, or local laws, and for which all required approvals by the City are properly obtained.

(Ord. 165 § 1, 2007)

Franchisee shall be subject to all provisions of the franchise agreement and all applicable laws, ordinances, and regulations of the City of Lake Forest, Orange County Transportation Agency (OCTA), State of California, United States of America, and any other public agency having jurisdiction over territory located within the City. The grant of a franchise shall not relieve the franchisee of any obligation under the Lake Forest Municipal Code to obtain any building and construction permits, public works permits, encroachment permits, use permits, or any other specific authorization that may be required for the proposed project. Unless the franchise agreement adopted by the City Council provides otherwise, a franchise does not grant a right to construct or install physical improvements at specified locations, which locations shall be determined and approved pursuant to applicable planning processes and permits.

(Ord. 165 § 1, 2007)

Negotiation and grant of a nonexclusive franchise shall comply with the following procedural requirements:

A. Each applicant for a franchise shall submit the following to the City:

1. A written "Request and Application for Franchise" to the City Manager or his/her designee in a form prescribed by the City Manager or designee; and,

2. A proposal identifying the requested use of the public right-of-way, proposed locations of right-of-way occupation, descriptions of proposed physical improvements if they are to be constructed above ground, method of construction, time of construction, hours of operation, resources and procedures for maintenance, the amount and method of compensation to the City, and the initial term of the proposed franchise and any renewal, if applicable; and,

3. All applicable fees required by ordinance or resolution of the City Council.

B. Upon receipt of a completed application, the City Manager or designee shall submit the application to the Planning Commission for review of consistency with the General Plan.

C. Following a finding of General Plan consistency by the Planning Commission, the City Manager or designee shall negotiate a draft franchise agreement between the applicant and the City in consultation with the City Attorney. The applicant shall sign the draft franchise agreement indicating acceptance of the terms prior to submission to City Council for consideration.

D. The City Council shall hold a public hearing to consider a resolution accepting the franchise agreement and granting the franchise accordingly. At least 10 days prior to the hearing, the City shall publish notice of public hearing and intent to grant a franchise in any newspaper of general circulation in the community and post said notice in at least three posting places throughout the City.

E. The City Council may approve and accept the franchise agreement and grant the franchise by resolution, deny the application for franchise, or continue the decision to grant the franchise and return the franchise agreement with direction for further negotiation between City staff and the applicant.

(Ord. 165 § 1, 2007)

Negotiation and grant of an exclusive franchise shall comply with the following procedural requirements:

A. Each applicant for an exclusive franchise shall submit the following to the City:

1. A written "Request and Application for Exclusive Franchise" to the City Manager or his/her designee in a form prescribed by the City Manager or designee; and,

2. A proposal identifying the requested use of the public right-of-way, proposed locations of right-of-way occupation, description of proposed physical improvements if they are to be constructed above ground, method of construction, time of construction, hours of operation, resources and procedures for maintenance, the amount and method of compensation to the City, and the initial term of proposed exclusive franchise and any renewal, if applicable; and,

3. All applicable fees required by ordinance or resolution of the City Council.

B. The City Council shall accept the application and consider a "Resolution of Intention to Consider an Exclusive Franchise and Call for Proposals" which recites the terms under which the City intends to grant the exclusive franchise.

C. If said resolution is adopted by the City Council, the City shall publish within 10 days after adoption of the resolution a "Notice of Intention to Consider an Exclusive Franchise and Call for Proposals" in any newspaper of general circulation in the community and post said notice in at least three posting places throughout the City. The notice shall invite competing proposals to be submitted to the City Manager within 60 days of the date the "Resolution of Intention to Consider an Exclusive Franchise and Call for Proposals" was adopted. The City Manager or designee may also send notice to any other persons potentially interested in submitting a proposal.

D. The City Manager or designee shall consider all proposals and submit one or more of the proposals to the City Council for final selection. The City Council may select one proposal and direct the City Manager or designee to negotiate a draft exclusive franchise agreement between the City and the party submitting the selected proposal. The City Manager or designee shall negotiate the draft exclusive franchise agreement in accordance with the terms of the proposal, the provisions of this chapter, and the best interests of the City. If the City Council rejects all proposals submitted by the City Manager, the process provided for in this chapter is concluded.

E. The City Manager shall submit the application and the draft exclusive franchise agreement to the Planning Commission for review of consistency with the General Plan.

F. Following a finding of General Plan consistency by the Planning Commission, the City Council shall hold a public hearing to consider a resolution accepting the exclusive franchise agreement and granting the exclusive franchise accordingly. At least 10 days prior to the hearing, the City shall publish notice of public hearing and intent to grant an exclusive franchise in any newspaper of general circulation in the community and post said notice in at least three posting places throughout the City. The notice shall state the date, time, and location of the public hearing for protests and public comments to be heard.

G. The City Council may approve and accept the exclusive franchise agreement and grant the exclusive franchise by resolution, deny the application for exclusive franchise, or continue the decision to grant the exclusive franchise and return the exclusive franchise agreement with direction for further negotiation between City staff and the proposed franchisee.

(Ord. 165 § 1, 2007)

Franchisee shall be subject to all other conditions, restrictions, and specifications as outlined in the franchise agreement negotiated between the City and franchisee as adopted and approved by resolution of the City Council. Further, the City reserves the power to adopt and enforce additional requirements and regulations as are necessary and convenient in the exercise of its jurisdiction under this chapter and may determine any question of fact which may arise during the existence of any franchise granted hereunder.

(Ord. 165 § 1, 2007)

The City Council may waive any procedural requirement imposed under this chapter when the City Council determines it to be in the best interest of the City.

(Ord. 165 § 1, 2007)

Franchisee shall not assign or otherwise transfer a franchise granted by the City Council pursuant to this chapter without the express prior written consent of the City Council.

(Ord. 165 § 1, 2007)

Franchisee shall agree, and shall so state in the franchise agreement, to indemnify, protect, defend, and hold harmless the City, its officers, officials, employees, and agents against any and all claims, demands, losses, costs, expenses, penalties, damages, or liability of any kind or nature, including but not limited to injury, death of persons, damage to property, and any attorney fees, arising directly or indirectly out of franchisee's exercise or enjoyment of its franchise, or any other negligent or wrongful acts or omissions by franchisee, its officers, employees, or agents, excepting only liability arising out of the sole negligence of the City. Further, franchisee shall agree, and shall so state in the franchise agreement, to indemnify, protect, defend, and hold harmless the City, its officers, officials, employees, and agents against any and all claims, demands, losses, costs, expenses, penalties, damages, or liability of any kind or nature resulting from, or arising with respect to, the award of the franchise, including but not limited to the procedure for accepting and reviewing proposals and the decision of award, negligent or otherwise, including but not limited to a claim of bad faith.

(Ord. 165 § 1, 2007)

The City Council reserves the right to revoke any franchise granted pursuant to this chapter, and all rights and privileges pertaining thereto, in the event that the franchisee violates any provision of the franchise agreement, this chapter, or any other material provision of the Lake Forest Municipal Code or other law subject to enforcement by the City. Upon suspicion of such a violation, the City Manager may schedule a hearing before the City Council to consider revocation of the franchise and notify franchisee thereof by certified and regular first class mail at least 30 days prior to said hearing. Franchisee may present evidence rebutting the violation or evidence showing an effort to correct the violation and mitigate its effects. Following the hearing, the City Council may revoke the franchise, continue the franchise, or continue the franchise subject to additional conditions at its discretion. The right to revoke any franchise granted pursuant to this chapter is in addition to, and not in lieu of, any other remedies available to the City.

(Ord. 165 § 1, 2007)