Point Arena Municipal Code Art. V Limitations on Franchise

(1) Every franchise granted under this chapter shall be nonexclusive.

(2) No privilege or exemption shall be granted or conferred by any franchise granted under this chapter except those specifically prescribed herein.

(3) Any privilege claimed under any such franchise by the grantee in any street or other public property shall be subordinate to any prior lawful occupancy of the streets or other public property.

(4) Any such franchise shall be a privilege to be held in personal trust by the original grantee.

(a) A franchise shall not in any event be sold, transferred, leased, assigned, or disposed of, in whole or in part, either by forced or involuntary sale, or by voluntary sale, merger, consolidation, or otherwise without prior consent of the council expressed by resolution and then only under such conditions as may therein be prescribed. Any such transfer or assignment shall be made only by an instrument in writing, such as a bill of sale, or similar document, a duly executed copy of which shall be filed in the office of the city clerk within 30 days after any such transfer or assignment. The said consent of the council may not be unreasonably refused; provided, however, that the proposed assignee shall show adequate financial responsibility as determined by the council and shall agree to comply with all provisions of this chapter; and provided further, that no such consent shall be required for a transfer in trust, mortgage, or other hypothecation, in whole or in part, to secure an indebtedness except that, when such hypothecation shall exceed 50 percent of the market value of the property used by the grantee in the conduct of the cable television system, prior consent of the council shall be required for such a transfer. Such consent shall not be withheld unreasonably.

(b) In the event that grantee is a corporation, prior approval of the council, expressed by ordinance, shall be required where there is an actual change in control or where ownership of more than 50 percent of the voting stock of grantee is acquired by a person or group of persons acting in concert, none of whom already own 50 percent or more of the voting stock.

(c) Nothing herein shall prevent any transfer between a wholly owned subsidiary and a parent company, or a name change which does not reflect any substantive change in the ownership of the grantee's legal entity.

(5) Time shall be of the essence of any franchise granted under this chapter. The grantee shall not be relieved of his obligation to comply promptly with any of the provisions of this chapter by any failure of the city to enforce prompt compliance.

(6) Any right or power in, or duty impressed upon, any officer, employee, department, or board of the city shall be subject to transfer by the city to any other officer, employee, department, or board of the city.

(7) The grantee shall have no recourse whatsoever against the city for any loss, cost, expense, or damage arising out of any provision or requirement of this chapter or of any franchise issued hereunder, or because of its enforcement, except for such acts as may arise out of the willful, tortious conduct of the city.

(8) The grantee shall be subject to all requirements of city laws, rules, regulations, and specifications heretofore or hereafter enacted or established, pursuant to the valid exercise of the police power of the city.

(9) Any franchise granted shall not relieve the grantee of any obligation involved in obtaining pole or conduit space from any department of the city, utility company, or from others maintaining utilities in streets.

(10) Any other provision of this chapter notwithstanding, in the event that extraordinary unforeseen circumstances beyond the control of grantee materially impact (a) the ability of grantee to derive a fair and reasonable rate of return from a cable television franchise granted under this chapter, or (b) the ability of grantee to perform some or all of its obligations under this chapter or a franchise granted under this chapter, then grantee shall have the right to petition the council for special relief. Upon a demonstration to the council by grantee of such extraordinary unforeseen circumstances and the impacts thereof, grantee shall be entitled to appropriate relief grantee shall bear the burden of proof to establish the extraordinary, unforeseen circumstances and adverse impact as set forth in (a) and (b) of this subsection (10).

(Ord. 127 § 4.04.110, 1987.)

(1) Nothing herein shall be deemed or construed to impair or affect, in any way, to any extent, 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, at a fair and just value, which shall not include any amount for the franchise itself or for any of the rights or privileges granted, and nothing herein contained shall be construed to contract away or to modify or abridge, whether for a term or in perpetuity, the city's right of eminent domain. Any acquisition of grantee's property shall be consistent with the terms of the Cable Communications Policy Act of 1984.

(2) There is hereby reserved to the city every right and power which is required to be herein reserved or provided by any law, and the grantee, by its acceptance of the franchise, agrees to be bound thereby and to comply with any action or requirements of the city in its exercise of such rights or power heretofore or hereafter enacted or established, pursuant to the valid exercise of the police power by the city.

(3) Neither the granting of any franchise nor any provision hereof shall constitute a waiver or bar to the exercise of any governmental right or power of the city.

(4) The council may do all things which 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. The city manager, with the approval of the city attorney, is hereby authorized and empowered to adjust, settle, or compromise any controversy or charge arising from the operations of any grantee under this chapter, either on behalf of the city, the grantee, or any subscriber, in the best interest of the public. In the event that the grantee is dissatisfied with the decision of the city manager, grantee may appeal the matter to the council for hearing and determination. The council may accept, reject, or modify the decision of the city manager, and the council may adjust, settle, or compromise any controversy or cancel any charge arising from the operations of the grantee or from any provision of this chapter.

(Ord. 127 § 4.04.120, 1987.)

(1) Standards of Operation.

(a) Prior to receiving any applications for franchises, the council may adopt, by resolution, rules, regulations, and standards governing the operation of cable television systems in the city. Such rules, regulations, and standards shall apply to and shall govern the operations of the grantee of any franchise hereunder and are expressly declared apart of any franchise hereunder.

(b) Notwithstanding any provision herein to the contrary, the council may increase the technical standards required of grantee's operation at any time during the life of the franchise reasonably related to the state of the art then prevailing, so long as such technical standards do not conflict with the then effective Federal Communications Commission guidelines or regulations and so long as the grantor establishes that such standards are technically and economically feasible.

(c) Rules, regulations, and standards not adopted prior to receiving any application for a franchise shall be adopted by the council at the first regular meeting of the council next following the effective date of the ordinance codified in this chapter by resolution which shall become effective upon adoption and shall be applicable to any application for a franchise previously received.

(d) The standards adopted shall govern the engineering, construction, installation, service, and maintenance of all cable television systems in the city including, but not limited to, standards governing carrier levels, signal-to-noise ratios, hum modulation, distortion levels, channel interactions, and interference.

(e) Provided the same do not materially alter the content or provisions of the franchise; and further provided, that the council may, consistent with this chapter and any ordinance granting a franchise hereunder, at any time adopt new rules or regulations or standards, or may amend, modify, delete, or otherwise change its respective rules or regulations or standards previously adopted, in the following manner: The council shall pass its resolution of intention stating or describing the rules or regulations or standards to be adopted, amended, modified, deleted, or otherwise changed and fixing and setting forth a day, hour, and place certain when and where any persons having any interest therein, or objection thereto, may appear before the council and be heard. No rule, regulation or standard or amendment, modification, deletion or change shall be adopted by the council unless such rule, regulation or standard or amendment modification, deletion or change is technologically and economically feasible. Such resolution shall direct the city clerk to publish the same at least once within 10 days of the passage thereof in a newspaper of general circulation within the city and to mail a copy of the same to any grantee or applicant for a franchise not more than 30 days nor less than 15 days prior to the time fixed for hearing thereon.

(i) At the time set for such hearing, or at any adjournment thereof, the council shall proceed to hear and pass upon such comments as may be presented. Thereafter, the council, by its resolution, may adopt, amend, modify, delete, or otherwise change its respective rules, regulations, and standards as set forth above. Such determination by the council shall be final and conclusive.

(ii) Any rule or regulation or standard as adopted, amended, modified, deleted, or otherwise changed by the council shall become effective upon the tenth day following the adoption of such resolution unless a longer period shall be otherwise provided in such resolution.

(f) In the event that the Federal Communications Commission modifies any provision of 47 CFR Part 76, pertaining to cable television standards, such modifications, to the extent explicitly inconsistent, shall be deemed to modify any franchise granted pursuant hereto.

(2) Rates.

(a) In granting any franchise hereunder, the council, by resolution, may establish and fix all rates and charges for the basic service, herein defined, allowable to grantee.

(b) Rates and charges for services, other than the basic service, may also be subject to approval by the council by resolution after due notice and hearing as provided herein, but only in the event that such regulation is permitted by the Federal Communications Commission, federal law, or any other applicable law.

(c) In connection with any proposed change of any rates or charges of grantee to subscribers initiated by grantee over which grantor has ultimate authority, or the approval of rates for additional services, at any time after the granting of a franchise, the council may direct the city manager of the city to conduct a preliminary hearing into the matter. If so directed by the council, the city manager shall issue his written notice fixing and setting forth the day, hour, and place certain when and where any persons having any interest therein may appear and be heard.

(i) The city clerk shall cause such notice to be published in a newspaper of general circulation within the city. The city clerk shall also cause a copy of such notice to be mailed to any grantee at least 10 days prior to the date specified for the hearing. At the time set for such hearing, or at any adjournment thereof, the city manager shall proceed to hear the matter. Following the close of such hearing, the city manager shall prepare and file with the council his report of the hearing, his findings, and an opinion containing his recommendations, and the reasons therefor.

(ii) Within 60 days after said hearing, the city manager shall render a written decision on the grantee's petition, either accepting, rejecting, modifying or deferring the same and reciting the basis of its decision. Such decision shall be rendered on the basis of criteria set forth in the ordinance or resolution granting or renewing a franchise. In the absence of any such criteria the city manager shall consider, but not be limited to, the following factors in approving or disapproving the petition:

(A) Grantee's substantial fulfillment of all material requirements of the franchise.

(B) Quality of service, as indicated by the number and type of service complaints, grantee's response to complaints, and the result of periodic system performance tests and the annual reviews specified in PAMC 5.15.170.

(C) Prevailing rates for comparable services in other cable systems of similar size and complexity.

(D) Rate of return on grantee's equity, as compared to businesses of equivalent risk. For the purposes of this chapter, the "rate of return on equity" shall be defined as the net, after-tax profit divided by the equity portion of grantee's investment as reported on the grantee's financial statement.

The rate of return shall be calculated on a cumulative basis for all system revenues and costs excluding pay service revenues, fees and associated assets. Upon request of the city manager, grantee shall promptly provide, from the grantee, its parent company and any subsidiary company, all information as shall be reasonably necessary to determine system revenues and costs.

(E) Performance of grantee in introducing new services and expanding the cable system's capability, as compared to other systems of similar size and complexity, and as evaluated by the system and services review specified in PAMC 5.15.170.

(iii) If the city manager or the council fail to render a written decision either accepting, rejecting, or modifying grantee's petition within 120 days of the grantee's petition pursuant to this section, the grantee shall thereafter be entitled to put its proposed new rates into effect.

(iv) The grantee's petition for a rate increase shall include, but not be limited to, the following financial reports, which shall reflect the operations of the system:

(A) Balance sheet;

(B) Income statement;

(C) Statement of sources and applications of funds;

(D) Detailed supporting schedules of expenses, income, assets, depreciation and other items as may be required;

(E) Statement of current and projected subscribers and penetration.

(v) The grantee's accounting records applicable to the system shall be available for inspection by the grantor at all reasonable times. The grantor shall have access to records of financial transactions for the purpose of verifying burden rates or other indirect costs prorated to the operation. The documents listed above shall include sufficient detail and/or footnotes as may be necessary to provide the grantor with the information needed to make accurate determinations as to the financial condition of the system. All financial statements shall be certified as accurate by a certified public accountant or an office of grantee.

(vi) After the expiration of 10 days following receipt of the city manager's report and opinion, and, if no objection has been filed thereto, the council shall determine whether to adopt the opinion or to hold a further hearing and shall pass its resolution of intention to do so, describing and stating any rates or charges to be changed, the reasons of the council therefor, fixing and setting forth a day, hour, and place certain when and where any persons having any interest therein may appear before the council and be heard. Such resolution shall direct the city clerk to publish the same resolution at least once 10 days prior to the passage thereof in a newspaper of general circulation within the city. The city clerk also shall cause a copy of such resolution to be mailed to the grantee at least 10 days prior to the date specified for hearing thereon.

(vii) If upon receipt of the report and opinion, and the expiration of said 10 days without objection, or following the holding of a further hearing, if the council determines to do so, the council shall find that the changing of any rates or charges of grantee to subscribers will be fair to the system operator and not unreasonably detrimental or injurious to the best interests and welfare of the subscribers and users and of the city, then the council, by resolution, shall authorize the change of rates or charges of grantee to subscribers and users as determined. Such resolution shall thereupon become and shall be a part of any franchise granted hereunder and affected thereby.

(viii) Neither the council nor the grantee shall, as to rates, charges, service, service facilities, rules, regulations, or in any other respect, make or grant any preference or advantage to any person nor subject any person to prejudice or disadvantage; the foregoing, however, shall not be construed to prohibit the offering by grantee of discounts to elderly subscribers, or any sales or promotional discounts of limited duration.

(ix) Pursuant to PAMC 5.15.085, the council, by resolution, may waive the provisions of this section with respect to the regulation of rates and charges for any or all of the services provided by a grantee. Such a waiver shall not be a bar to the subsequent revocation of such waiver; provided, that the reinstitution of rate and charge regulation shall apply only to increases proposed subsequent to the revocation of the waiver.

(d) In the event that a franchise elects to exercise any rights it may have pursuant to Section 53066.1 of the Government Code, the council may enact such regulations as are consistent with Section 53066.1 for the protection of subscribers.

(Ord. 127 § 4.04.130, 1987.)

(1) A grantee shall furnish each subscriber at the time service is installed written instructions that clearly set forth procedures for placing a service call. Such instructions shall also include the name, business address and business telephone number of the office designated by the city manager and notice that the subscriber may call or write the city for information regarding terms and conditions of the cable franchise agreement and this chapter, if grantee fails to respond to the subscriber's request for service or adjustment within the periods required in this section. The instructions shall also include information regarding service response time and service interruptions and notifications as required in this section.

(2) A grantee shall provide service response, within 24 hours, five days a week, for all complaints and requests for repairs or adjustments received prior to 12:00 noon of each working day. In no event shall the response time for calls received subsequent to 12:00 noon exceed two working days.

(3) A grantee may interrupt system service after 6:00 a.m. and before 11:00 p.m. only upon necessary cause for the shortest time possible and only after publishing notice of service interruption, except for emergency situations. Services may be interrupted between 11:00 p.m. and 6:00 a.m. for routine testing, maintenance and repair, without notification.

(4) Except for acts of God, and except in circumstances where prior approval has been obtained from the city, in the event that service to any subscriber or user is interrupted, as defined in PAMC 5.15.020(15), and the interruption is under the control of the grantee, a grantee shall rebate a pro rata percentage of the monthly fee to affected subscribers or users for each 24-hour period of interrupted service after the first 24 hours.

(5) A grantee shall be responsible for all subscriber and user complaint resolution and shall maintain a written record or log, listing the date and time of customer complaints, describing the nature of the complaints and when and what actions were taken by the grantee in response thereto. The log shall be kept at the grantee's local office, reflecting the operations to date for a period of at least three years, and shall be available for inspection by the city during regular business hours at the grantee's local office.

(Ord. 127 § 4.04.135, 1987.)

(1) Within 30 days after acceptance of any franchise, the grantee shall proceed with due diligence to obtain all necessary permits and authorizations which are required in the conduct of its business including, but not limited to, any utility joint use attachment agreements, microwave carrier licenses, and any other permits, licenses, and authorizations to be granted by duly constituted regulatory agencies having jurisdiction over the operation of cable television systems or associated microwave transmission facilities.

In connection therewith, copies of all petitions, applications, and communications submitted by the grantee to the Federal Communications Commission, Securities and Exchange Commission, or any other federal or state regulatory commission or agency having jurisdiction in respect to any matters affecting grantee's cable television operations within the city shall also be submitted simultaneously to the city manager.

(2) Within 90 days after obtaining all necessary permits, licenses, and authorizations, including right of access to poles and conduits, grantee shall commence construction and installation of the cable television system.

(3) Within 180 days after the commencement of construction and installation of the system, grantee shall proceed to render service to subscribers, and the completion of the installation and construction shall be pursued with reasonable diligence thereafter so that service to all of the areas designated and scheduled on the map and plan of construction made a part of the franchise shall be provided at the times set forth therein. Notwithstanding any provision to the contrary in this chapter, no franchise shall be granted unless a construction schedule and line extension policy are a condition thereof and of sufficient detail as to guarantee all households in the franchise area basic service within the earliest feasible time at the lowest feasible cost.

(4) Substantial failure on the part of the grantee to commence and diligently pursue each of the foregoing requirements and to complete each of the matters set forth herein may be grounds for termination of such franchise. By resolution, the council shall extend the time for the commencement and completion of installation and construction for additional periods upon a showing by grantee that it has experienced delays by reason of circumstances beyond its control.

Failure to comply with any time requirements referred to in subsections (1), (2), and (3) of this section will result in damage to the city and that it is and will be impracticable to determine the actual amount of such damage in the event of delay and grantee therefore agrees that, in addition to any other damage suffered by city as set forth in PAMC 5.15.065(3)(c)(iii), it will pay to city the sum of $500.00 per day for each and every day's delay beyond the time prescribed, plus authorized extensions thereof, for completion of any of the acts required to be done by this section.

(5) Grantee shall utilize existing poles, conduits, and other facilities whenever possible and shall not construct or install any new, different, or additional poles, conduits, or other facilities, whether on public property or privately-owned property, unless and until first securing the written approval of the city manager.

Whenever grantee shall not utilize existing poles, conduits, and other facilities, or whenever all existing utility and telephone conduits and other facilities shall be located beneath the surface of the streets on a particular street, or whenever the city shall undertake a program designed to cause all conduits and other facilities to be located beneath the surface of the streets in any area or throughout the city, in the exercise of its police power or pursuant to the terms hereof, upon reasonable notice to grantee, any such conduits or other facilities of grantee shall be constructed, installed, placed, or replaced beneath the surface of the streets. Any construction, installation, placement, replacement, or changes which may be so required shall be made at the expense of grantee, whose costs shall be determined as in the case of public utilities.

(6) In those areas of the city where the transmission or distribution facilities of the respective public utilities providing telephone, communication, and electric services are underground, or hereafter are placed underground, the grantee likewise shall construct, operate, and maintain all of his transmission and distribution facilities underground. The term "underground" shall include a partial underground system; provided, that upon obtaining the written approval of the city manager, amplifiers of the grantee's transmission and distribution lines may be placed in appropriate housings upon the surface of the ground.

(7) The grantee, at its expense, shall protect, support, temporarily disconnect, relocate, or remove any property of grantee when, in the opinion of the city manager or the city's director of public works the same is required by reason of traffic conditions, public safety, street vacation, freeway or street construction, change or establishment of street grade, installation of sewers, drains, waterpipes, power lines, signal lines, transportation facilities, tracks, or any other types of structure or improvements by governmental agencies whether acting in a governmental or a proprietary capacity, or any other structure or public improvement including, but not limited to, movement of buildings, urban renewal and redevelopment, and any general program under which the city shall undertake to cause all such properties to be located beneath the surface of the ground. The grantee shall in all cases have the privilege, subject to the corresponding obligations, to abandon any property of grantee in place, as herein provided. Nothing hereunder shall be deemed a taking of the property of grantee, and grantee shall be entitled to no surcharge by reason of anything hereunder.

(8) Upon the failure, refusal, or neglect of grantee to cause any work or other act required by law or hereunder to be properly completed in, on, over, or under any street within any time prescribed therefor, or upon reasonable notice given, where no time is prescribed, the city manager may, if grantee fails within a reasonable time to act, cause such work or other act to be completed in whole or in part and, upon so doing, shall submit to grantee an itemized statement of the reasonable costs thereof. The grantee shall, within 30 days after receipt of such statement, pay to the city the entire amount thereof.

(9) In the event that (a) the use of any part of the system of grantee is discontinued for any reason for a continuous period of 30 days, without prior written notice to and approval by the city, or (b) any part of such system has been installed in any street or other area without complying with the requirements hereof, or (c) any franchise shall be terminated, cancelled, or shall expire, then the grantee shall, at the option of the city, and at the expense of grantee and at no expense to the city and upon demand of the city, promptly remove from any streets or other area all property of grantee, and grantee shall promptly restore the street or other area from which such property has been removed to such reasonable condition as the city manager or city director of public works shall approve.

(10) The council may, upon written application therefor by grantee, approve the abandonment of any of such property in place by grantee and under such terms and conditions as the council may prescribe. Upon abandonment of any such property in place, grantee shall cause to be executed, acknowledged, and delivered to the city such instruments as the city attorney shall prescribe and approve, transferring and conveying the ownership of such property to the city.

(Ord. 127 § 4.04.140, 1987.)