Merced Municipal Code Art. XIV Franchises

No person, firm, company, or corporation shall exercise any franchise in the City except insofar as such person, firm, company, or corporation may be entitled to do so by direct authority of the Constitution of the State of California or of the United States, unless such person, firm, company, or corporation shall have obtained a grant therefor in accordance with the provisions of this Article. Subject to the foregoing, any person, firm, company or corporation furnishing the City or its inhabitants with utilities or services that are transmitted or delivered through a portion or portions of public streets, alleys, ways, rights-of-way, buildings, structures, or other public places and properties, as the same may now or may hereafter exist, either above or below ground, including but are not limited to, transportation, communication, digital and electronic information and entertainment, terminal facilities, water, light, heat, natural gas, electricity, any form of power and energy for household or other use within the City, or any other public utility or service, may be required by Ordinance of the City Council to have a valid and existing franchise.

The City Council is empowered to grant such franchise by Ordinance and prescribe the terms and conditions of any such grant to any person, firm, company or corporation, whether operating under an existing franchise or not, without calling for bids or may, in its discretion, advertise for bids for the sale of a franchise, not in conflict with the provisions of this Charter, to be set out in the advertisement for bids and notice of sale. The City Council may also provide, by Ordinance, the method of procedure and additional terms and conditions for making such grants, subject to the provisions of this Charter.

(Amended November 6, 2007).

Before granting any franchise, the City Council shall pass a Resolution declaring its intention to grant the same, stating the name of the proposed grantee, the character of the franchise and the terms and conditions upon which it is proposed to be granted. Such Resolution shall fix and set forth the date, time, and place when and where any person having any interest therein or any objection to the granting thereof may appear before the City Council and be heard thereon. The City Clerk shall publish said Resolution in the official newspaper at least once within fifteen days of the passage thereof and not less than ten days prior to the date of the hearing.

At the time set for the hearing the City Council shall proceed to hear and receive all protests, and its decision thereon shall be final and conclusive. Thereafter, the City Council may grant or deny the franchise, subject to the right of referendum of the people.

(Amended November 6, 2007).

Every franchise shall be either a fixed term not to exceed a maximum of twenty-five years after its first effective date, or for an indeterminate period. If for a fixed term, the franchise shall state the term for which it is granted; if indeterminate, the franchise shall set forth the terms and conditions under which it may be terminated.

(Amended November 6, 2007).

Any franchise granted by the City with respect to any given utility or service shall be in-lieu of all other franchises, rights, or privileges owned by the grantee, or by any successor of the grantee to any right under such franchise, for the rendering of such utility or service within the limits of the City as they now or may hereafter exist. The acceptance of any franchise hereunder shall operate as an abandonment of all such franchises, rights and privileges within the limits of the City.

Any franchise granted hereunder shall not become effective until written acceptance thereof shall have been filed by the grantee thereof with the City Clerk. Such acceptance shall be filed within ten days after the adoption of the Ordinance granting the franchise, or any extension thereof granted by the City Council, and when so filed, such acceptance shall constitute a continuing agreement of such grantee that if and when the City shall thereafter annex, or consolidate with additional territory, any and all franchises rights and privileges owned by the grantee therein shall likewise be deemed to be abandoned within the limits of such territory. No grant of any franchise may be transferred or assigned by the grantee except by consent in writing of the City Council and unless the transferee or assignees thereof shall unconditionally covenant and agree to perform, and assume and be bound by, each and all of the terms and conditions imposed in the grant, the Ordinance, and this Charter.

(Amended November 6, 2007).

No franchise grant shall in any way, or to any extent, impair, diminish, or adversely affect the right of the City to acquire the property of the grantee thereof either by purchase or through the exercise of the right of eminent domain. Upon any such acquisition by the City, the compensation or price shall not include the value of the franchise. 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 or privately-owned public utility.

(Amended November 6, 2007).

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, and shall further agree to:

A. Comply with all Ordinances, rules and regulations theretofore or thereafter adopted by the City Council;

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, including repairs required for portion or portions of public streets, alleys, ways, rights-of-way, buildings, structures, or other public places and properties, as the same may now or may hereafter exist, either above or below ground;

C. Protect, defend, indemnify, save and hold harmless the City and its officers, agents, and employees from any and all claims, liabilities, or causes of action for death or injury to persons, or damage to property proximately resulting from any operation under such franchise or from the intentional or negligent acts, errors, or omissions of the grantee or its officers, employees, or agents, or from any violation of any federal, state, or municipal law or ordinance, or by the quality or character of grantee's work or activities under the franchise;

D. Remove and relocate without compensation to grantee or expense to the City any facilities installed, used and maintained under the franchise, either above or below ground, if and when made necessary by change of grade, alignment, width, or use of any public street, way, alley, right-of-way, building, structure, or other public place or property, including the construction of any subway, bridge, viaduct, or overpass, 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 City Council may prescribe in the grant.

(Amended November 6, 2007).

The exercise by any person, firm, company 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.

(Amended November 6, 2007).

Nothing contained in this Article shall be construed to:

A. Invalidate any lawful franchise heretofore granted, nor to necessitate the obtaining of a new franchise for a use which a franchise holder shall have a valid unexpired franchise;

B. Affect or impair any rights, powers, or privileges vested in, possessed by, or available to the City by virtue of previous Charter provisions relating to franchises;

C. Apply to the City, or any department thereof, when furnishing any public utility or service.

(Added November 6, 2007).

Upon annexation of areas to the City without an existing franchise granted by another governmental entity pursuant to state law, the grantee, by its acceptance of a franchise under this Article, shall serve such areas under the terms of this Article and the franchise.

No grantee shall be relieved of its obligation to comply with any provision of this Article, or to perform any term or condition of the franchise by any failure of the City to enforce such term or condition.

(Added November 6, 2007).