Article VIII — State Video Franchises

This Article VIII implements the Digital Infrastructure and Video Competition Act of 2006, set forth at Public Utilities Code section 5800 and following (the "Act"; AB 2987). The Act creates a process for the state, rather than local cities and counties, to grant video service franchises. It will be administered by the California Public Utilities Commission (CPUC).

Under the Act, some authority is retained by local cities and counties, and the purpose of this article is to implement that local authority in the city.

Parenthetical references in this article are to the California Public Utilities Code (PUC). (Ord. 829 § 1, 2008)

The terms "video service," "video franchise" and "holder" shall have the same meaning as those terms are defined in Public Utilities Code section 5830.

"Gross revenue" has the meaning set forth in California Public Utilities Code section 5860(d).

Terms not defined here shall have the same meaning as established in (in order of priority): (1) the California Public Utilities Code; (2) commission rules implementing the California Public Utilities Code; and (3) Title 47 United States Code Title VI.

(Ord. 829 § 1, 2008)

• A. Copy of application to city. An applicant for a state video franchise within the city must concurrently provide a complete copy to the city manager of any application or amendments to an application filed with the California Public Utilities Commission (CPUC) (PUC § 5840(n)).

• B. City manager comments to CPUC. Within 30 days of receipt, the city manager will provide any appropriate comments to the CPUC regarding an application or an amendment to an application for a state video franchise.

• (Ord. 829 § 1, 2008)

• A. Franchise fee. Any state video franchise holder operating within the city shall pay a fee to the city equal to 5% of the gross revenues of that state video franchise holder derived from the operation of its franchise within the city (PUC § 5840(q)). A state video franchise holder shall pay the franchise fee to the city quarterly, within 45 days after the end of each calendar quarter. Each payment shall be accompanied by a summary explaining the basis for the calculation of the fee.

• B. PEG fees.

  1. Current fees. Any state video franchise holder operating within the city shall pay a

PEG fee to the city in an amount equal to the existing unsatisfied obligations of the incumbent operator's franchise.

2. Fee to take effect upon expiration of incumbent operator's franchise. Any state video franchise holder operating within the city upon the expiration of the incumbent operator's franchise shall pay a PEG fee to the city equal to 1% of the gross revenue of that state video franchise holder derived from the operation of its franchise within the city. A state video franchise holder shall pay the PEG fee to the city quarterly, within 45 days after the end of each calendar quarter. The city will use the receipts of the PEG fee for purposes consistent with state and federal law. (PUC § 5870(n).)

• C. Authority to examine records. The city manager may examine the business records of a holder of a state video franchise to ensure compliance with this section. The city may conduct such an examination not more than once each year (PUC § 5860(i)).

• (Ord. 829 § 1, 2008; Ord. 912 § 2, 2017)

• A. Compliance with customer service and protection standards. The holder of a state video franchise shall comply with all applicable state and federal customer service and protection standards pertaining to the provision of video service in the city (PUC § 5900(a) and (b)).

• B. City monitoring – Notice of violation – Penalties. The city manager shall monitor the compliance of state video franchise holders with respect to state and federal customer service and protection standards. The city manager will provide the state video franchise holder written notice of any material breaches of applicable customer service standards, and will allow the state video franchise holder 30 days from the receipt of the notice to remedy the specified material breach. A material breach not remedied within the 30-day time period will be subject to the following city penalties:

  1. For the first occurrence of a violation, a fine of $500.00 shall be imposed for each day the violation remains in effect, not to exceed $1,500 for each violation.

  2. For a second violation of the same nature within 12 months, a fine of $1,000 shall be imposed for each day the violation remains in effect, not to exceed $3,000 for each violation.

  3. For a third or further violation of the same nature within 12 months, a fine of $2,500 shall be imposed for each day the violation remains in effect, not to exceed $7,500 for each violation (PUC § 5900(c) and (d)).

• C. Appeal. A state video franchise holder may appeal a penalty assessed by the city manager to the city council as provided in PHMC § 1.10.010E, except that the period for appeal is 60 days of the initial assessment. The city council shall set the matter for hearing, and hear all evidence and relevant testimony. The council may uphold, modify or vacate the penalty. The city council's decision on the imposition of a penalty is final.

• (Ord. 829 § 1, 2008)

• A. A state video franchise holder is required to obtain an encroachment permit under PHMC Chapter 11.05 before constructing, operating, maintaining or repairing its facilities within the public right-of-way.

• B. The city shall either approve or deny an encroachment permit application within 60 days of receiving a completed application. An application is considered complete when the applicant has complied with all statutory requirements, including the California Environmental Quality Act (Pub. Res. Code § 21000 and following).

• C. If the city denies the encroachment permit, it shall provide the applicant with a detailed explanation of the reason for the denial. A determination regarding the encroachment permit by the director of public works and community development may be appealed in accordance with PHMC Chapter 1.10. (PUC §§ 5830(o), 5840(e) and 5885(c).)

• (Ord. 829 § 1, 2008)