Chapter MH-2.01 — STATE FRANCHISES TO PROVIDE VIDEO SERVICES

Sections:

MH-7-2200 - INTENT.

(a)

The Mountain House Community Services District, pursuant to The Digital Infrastructure and Video Competition Act of 2006 ("DIVCA") is entitled to receive a state franchise fee from and authorized to exercise certain powers pertaining to a video service provider which is granted a state franchise by the California Public Utilities Commission to provide video service in the District's limits.

(b)

The Board of Directors finds it is in the interest of the public convenience, safety, and general welfare to implement the rights and powers granted to the District under the DIVCA, and by this chapter, the District takes such action.

(Ord. 4345 § 1 (part), 2007)

MH-7-2201 - DEFINITIONS.

For the purpose of this chapter, the following terms, phrases, words, and their derivations shall have the meaning given herein. Words used in the present tense include the future, words in the plural number include the singular number, and words in the singular number include the plural number. The definitions in the DIVCA are incorporated herein. Words not defined shall be given their common and ordinary meaning.

(a)

"Affiliated Person" means each Person who falls into one (1) or more of the following categories: (i) each Person having, directly or indirectly, a controlling interest in the Company; (ii) each Person in which the Company has, directly or indirectly, a controlling interest; (iii) each officer, director, general partner, limited partner holding an interest of twenty-five percent (25%) or more, joint venturer or joint venture partner, of the Company; and (iv) each Person, directly or indirectly, controlling, controlled by, or under common control with, the Company; provided that "Affiliated Person" shall in no event mean the District, any limited partner holding an interest of less than twenty-five percent (25%) of the Company, or any creditor of the Company solely by virtue of its status as a creditor and which is not otherwise an Affiliated Person by reason of owning a Controlling Interest in, being owned by, or being under common ownership, common management, or common control with, the Company.

(b)

"Basic Cable Service" means any service tier which includes the retransmission of local television broadcast signals.

(c)

"Cable Act" means Title VI of the Communications Act of 1934, as amended, 47 U.S.C. § 521 et seq.

(d)

"Cable Television System," "System," "CATV System," or "Cable System," means a facility consisting of a set of closed transmission paths and associated signal generation, reception and control equipment that is designed to provide cable service, which includes video programming and which is provided to multiple Subscribers within a community, but such term does not include:

(1)

A facility that serves only to retransmit the television signals of one (1) or more television broadcast stations;

(2)

A facility that serves Subscribers without using any public right-of-way;

(3)

A facility of a common carrier which is subject, in whole or in part, to Title II of the 1934 Communications Act, as amended, except that such facility shall be considered a cable system (other than for purposes of Section 621 (c) of the Cable Act [47 U.S.C. 541 (c)]) to the extent such a facility is used in the transmission of video programming directly to Subscribers, unless the extent of such use is solely to provide interactive on- demand services;

(4)

An open video system that complies with Section 653 of the Cable Act, 47 U.S.C. § 573; or

(5)

Any facilities of any electric utility used solely for operating its electric utility system.

(e)

"Board of Directors" means the Board of Directors of the Mountain House Community Services District.

(f)

"District" means the Mountain House Community Services District as represented by the Board of Directors or any delegate acting within the scope of its jurisdiction.

(g)

"DIVCA" means the Digital Infrastructure and Video Competition Act of 2006.

(h)

"FCC" means the Federal Communications Commission, its designee, or any successor thereto.

(i)

"Franchise" means a certificate to provide video services or a renewal of such certificate issued by the California Public Utilities Commission pursuant to DIVCA.

(j)

"Franchise Fee" means the fee set forth in Section 5860 of the Public Utilities Code.

(k)

"Franchise Documents" means this chapter and any documents filed with and the certificate issued by the California Public Utilities Commission.

(l)

"Grantee" means any Person receiving a state franchise certificate issued by the California Public Utilities Commission, and such person's lawful successor, transferee or assignee.

(m)

"Installation" means the connection of the system to Subscribers' terminals.

(n)

"Institutional Network" means the cable or cables, electronics and ancillary equipment for governmental use, educational use, or both, provided by the Grantee.

(o)

"Person" means an individual, partnership, association, joint stock company, joint venture, trust, corporation or other legally recognized entity, whether for-profit or not for-profit, but shall not mean the District.

(p)

"Public Educational or Government Access Facilities" or "PEG Access Facilities" means the total of the following:

(A)

Channel capacity designated for public, educational, or governmental use; and

(B)

Facilities and equipment or the use of such channel capacity.

(q)

"Sections" means any section, subsection, or provision of this chapter.

(r)

"Service Area" or "Franchise Area" means the geographic area within the District as it is now constituted or may in the future be constituted, unless otherwise specified in the Agreement.

(s)

"Service Tier" means a category of video or cable service or other services provided by a Grantee and for which a separate rate is charged by the Grantee.

(t)

"State" means the State of California.

(u)

"Street" means the surface of and the space above and below each of the following which have been dedicated to the public or are hereafter dedicated to the public and maintained under public authority or by others and located within the District limits: streets, roadways, highways, avenues, lanes, alleys, sidewalks, easements, rights-of-way and similar public property and areas that the Grantor shall permit to be included within the definition of street from time to time.

(v)

"Subscriber" means any person who or which elects to subscribe to, for any purpose, a service provided by the Grantee by means of or in connections with video or cable system.

(w)

"Telecommunications Service" means "telecommunications service" as that term is defined under Section 3 of the Federal Communications Act of 1934, 47 U.S.C. 153(46), except that the term shall not include any Institutional Network for governmental or educational.

(Ord. 4345 § 1 (part), 2007)

MH-7-2202 - FRANCHISE REQUIRED.

It shall be unlawful for any person to construct, install, maintain, or operate a system to provide video service in the District without a properly granted Franchise.

(Ord. 4345 § 1 (part), 2007)

MH-7-2203 - FEDERAL OR STATE JURISDICTION.

(a)

This chapter shall not be construed in a manner prohibited by applicable Federal and State laws. Federal and State law, and any modification of such Federal or State law, shall to the extent applicable be considered part of this chapter as of the effective date of this chapter or the effective date of any modification of such Federal or State law.

(b)

In the event that the State or Federal government discontinues preemption in any area of cable communications over which it currently exercises jurisdiction in such manner as to expand rather than limit the District's authority, the District may, if it so elects, adopt rules and regulations in such areas.

(c)

This chapter shall apply to all Grantees.

(Ord. 4345 § 1 (part), 2007)

MH-7-2204 - CUSTOMER SERVICE STANDARDS AND PENALTIES.

(a)

Prior to providing video services in the District's territory, the Grantee shall provide the District a description of the Grantee's customer service standards which comply with Government Code Section 53055.

(b)

Grantee shall comply with Government Code Sections 53055, 53055.1, 53055.2, and 53088.2 and any other customer service standards pertaining to the provision of video services established by federal law or regulation or adopted by subsequent enactment of the California State Legislature.

(c)

For purposes of this chapter, "material breach" means any substantial and repeated failure of a Grantee to comply with any of the requirements set forth in either Government Code Sections 53055, 53055.1, 53055.2,

or 53088.2 or any other customer service standards pertaining to the provision of video services established by federal law or regulation or adopted by subsequent enactment of the California State Legislature.

(d)

Any person within the District who subscribes to the services of any Grantee may file a complaint with the District asserting that the Grantee has committed a material breach of Grantee's consumer service obligations.

(e)

The District delegates to its General Manager the authority to administer enforcement of the provisions of this section of this chapter. Upon receipt of any complaint, or upon his own motion, General Manager shall give the Grantee written notice of any material breach(s) and allow the Grantee at least thirty (30) days from receipt of the notice to remedy the specified material breach. A material breach for purposes of assessing any penalties under this section of this chapter shall be deemed to have occurred for each day within the territory of the District, following expiration of the notice provided for herein, that any such material breach has not been remedied by Grantee, irrespective of the number of customers affected. No monetary penalties shall be assessed for a material breach which is out of the reasonable control of Grantee.

(f)

If the material breach has not been cured as set forth above, the General Manager may assess penalties upon the Grantee in accordance with the following schedule:

(1)

Five hundred dollars ($500.00) for each day of each material breach, not to exceed one thousand five hundred dollars ($1,500.00) for each occurrence of a material breach.

(2)

For each subsequent material breach of the same nature occurring within any twelve (12) month period for which notice to Grantee was provided and an initial penalty assessed as set forth above, a penalty of one thousand dollars ($1,000.00) for each day of each material breach, not to exceed three thousand dollars ($3,000.00) for each occurrence of such material breach.

(3)

For any third and further material breach of the same nature within any twelve (12) month period for which notice to Grantee was provided and a second penalty assessed as set forth above, a penalty of two thousand five hundred dollars ($2,500.00) for each day of each material breach, not to exceed seven thousand five hundred dollars ($7,500.00) for each occurrence of such material breach.

(4)

One-half of all penalties received by the District shall be submitted to the Digital Divide Account established in Section 280.5 of the Public Utilities Code.

(g)

General Manager shall provide written notice of the assessment of the penalty to Grantee within five (5) business days of its assessment. Grantee may appeal the assessment to the Board within ten (10) business days of receipt of notice from the General Manager. Grantee's appeal shall be in writing and state why the assessment is in error. The Board shall review Grantee's submittal and either affirm, revise, or repeal the assessment. The Board shall provide written notice of its determination to Grantee and the General Manager within thirty (30) business days of its determination.

(h)

A Grantee shall not be relieved of any obligation to comply with any of the provisions of this chapter or any rule, regulation, requirement or directive promulgated thereunder by reason of any failure of the Board, or their officers, agents or employees to enforce prompt compliance.

(i)

All officers, agents, or employees of the Grantee or its contractors or subcontractors who in the normal course of work require entry onto Subscribers' premises shall carry a photo-identification card. Every vehicle of the Grantee utilized for field maintenance shall be clearly identified as working for the Grantee.

(j)

In addition, the Grantee shall provide to the District, upon request, a written report of the results of the Grantee's periodic performance tests conducted pursuant to any governmental requirements in order to permit the District to fulfill its duties regarding customer service standards.

(Ord. 4345 § 1 (part), 2007)

MH-7-2205 - RECORDS REQUIRED AND DISTRICT'S RIGHT TO INSPECT.

(a)

Grantee shall at all times maintain:

(1)

A record of all complaints received and interruptions or degradation of video service experienced for the preceding two (2) years, provided that such complaints result in or require a service call.

(2)

A full and complete set of plans, records and "as built" maps showing the location of the video service facilities installed or in use in the District, exclusive of Subscriber service drops and equipment provided in Subscriber's homes. Said plans, records and maps are trade secrets of Grantee and, as such, are exempt from disclosure to members of the public under the Public Records Act (Government Code Section 6250 et seq.), including Section 6254(n). District will not disclose any such records in response to a Public Records Request without first allowing the Grantee the opportunity to demonstrate that the plans, records and maps are exempt under express provisions of the Public Records Act or that on the facts of the particular case, the public interest served by not making the plans, records or maps public clearly outweighs the public interest served by disclosure of the plans, maps or records. The District shall provide Grantee with prompt notice of any request the District receives for public records that would include said plans, records or maps.

(b)

The District may impose reasonable requests for additional information, records and documents from time to time, provided they reasonably relate to the scope of the District's rights under this chapter or the Grantee's Franchise. Grantee shall have no obligation to provide information, records or documents which contain trade secrets of Grantee or which are otherwise of a confidential or proprietary nature to Grantee unless it receives satisfactory assurances from District that such information can and will be held in strictest confidence by the District.

(c)

Upon reasonable notice, and during normal business hours, Grantee shall permit examination by any duly authorized representative of the District, of all property and facilities used by Grantee in the provision of video services within the District's territory, together with any appurtenance property and facilities of Grantee situated within or without the District, and all records relating to the Franchise, provided they reasonably relate to the scope of the District's rights under this chapter or the DIVCA.

(d)

If any records to be examined are not kept within the District or upon reasonable request made available within the District, and if the Board determines that examination of the records is necessary and appropriate, then all travel and other expenses incurred in making the examination of the records shall be paid by Grantee.

(Ord. 4345 § 1 (part), 2007)

MH-7-2206 - COPIES OF FEDERAL AND STATE DECISIONS CONCERNING FINES, FORFEITURES, AND ADVERSE RULINGS.

Grantee shall provide District with copies of any decision of any Federal, State or local court, agency or governmental body, which imposes any fine or forfeiture on Grantee or renders any adverse decision regarding Grantee's operations in the District's territory. Grantee shall provide such documents to the District within five (5) days after its receipt from such court, agency and/or body.

(Ord. 4345 § 1 (part), 2007)

MH-7-2207 - PUBLIC REPORTS.

If Grantee is publicly held, a copy of each of Grantee's annual 10K and proxy statements filed with the Securities and Exchange Commission, and other periodic reports and those of its parent, shall be submitted to the District within forty-five (45) days of their issuance.

(Ord. 4345 § 1 (part), 2007)

MH-7-2208 - COMPLAINT REPORT AND OPINION SURVEY.

The Grantee shall furnish to the District the results of any opinion survey conducted by the Grantee which identifies satisfaction or dissatisfaction among Subscribers within the District with the Grantee's video service. The results of such survey shall be furnished to the District within thirty (30) days following completion of the survey.

(Ord. 4345 § 1 (part), 2007)

MH-7-2209 - REVIEW OF SYSTEM PERFORMANCE.

(a)

Annually following commencement of video services in the District's territory, if requested by the District, the District and Grantee shall meet publicly to review system performance and quality of Service.

(b)

The various reports required pursuant to this chapter, results of technical performance tests, the record of Subscriber complaints and Grantee's response to complaints, and the information acquired in any Subscriber surveys, shall be utilized as the basis for review. In addition, any Subscriber may submit comments or complaints during the review meetings, either orally or in writing, and these shall be considered. Within thirty (30) days after conclusion of a system performance review meeting, the District may issue findings with respect to the Grantee's compliance with customer service and protection standards and quality of service.

(Ord. 4345 § 1 (part), 2007)

MH-7-2210 - REPORTS—GENERAL.

(a)

All reports required under this chapter, except those which the Grantee has agreed to keep confidential, shall be available for public inspection in the District's offices during normal business hours.

(b)

All reports and records required under this chapter shall be furnished at the sole expense of Grantee, except as otherwise provided in this chapter.

(Ord. 4345 § 1 (part), 2007)

MH-7-2211 - FRANCHISE FEE.

(a)

Grantee shall pay to District a Franchise Fee in the amount of five percent (5%) of Grantee's gross receipts in accordance with Section 5860 of the California Public Utilities Code. The obligation to remit the franchise fee to the District begins immediately upon the provision of video service within the District's territory by Grantee and shall be paid in accordance with Section 5860.

(b)

The District will provide Grantee with documentation supporting the franchise percentage fee paid by any incumbent video provider upon receipt of the notice required to be provided to the District by Grantee pursuant to Section 5840(n) of the California Public Utilities Code.

(c)

The franchise fee shall be remitted as directed by the General Manager to the District quarterly within forty- five (45) days after the end of each quarter. Each payment shall be accompanied by a summary explaining the basis for its calculation. The summary shall identify all gross revenues (as defined in Section 5860 of the Public Utilities Code) received by Grantee during the applicable quarter and shall itemize the gross revenues in accordance with the subparagraphs of subsection (d) of Section 5860 of the Public Utilities Code. In the event Grantee has bundled video services with any other services, capabilities, or applications, Grantee shall provide support for its allocation to video services of a portion of the revenues for the bundled package of services.

(d)

Not more than once annually the District may examine the business records of Grantee to ensure compensation in accordance with Section 5860 of the Public Utilities Code. In connection with the review, Grantee will furnish records pertaining to its exclusion of any revenues in accordance with subsection (e) of Section 5860 of the Public Utilities Code.

(e)

No acceptance of any payment by the District shall be construed as a release or as an accord and satisfaction of any claim the District may have for further or additional sums payable as a Franchise Fee under this chapter or for the performance of any other obligation of the Grantee.

(f)

The Franchise Fee payments shall be in addition to and shall not constitute an offset or credit against any and all taxes or other fees or charges which the Grantee or any Affiliated Person shall be required to pay to the District, or to any State or federal agency or authority, as required herein or by law. The payment of said taxes, fees or charges shall not constitute a credit or offset against the Franchise Fee payments, all of which shall be separate and distinct obligations of the Grantee and each Affiliated Person.

(g)

If the Grantee does not pay the Franchise Fee when due, the Grantee shall pay a late payment charge at a rate per year equal to the highest prime lending rate during the period of delinquency, plus one (1) percent.

(Ord. 4345 § 1 (part), 2007)

MH-7-2212 - ALTERNATIVE REMEDIES.

No provision of this chapter shall be deemed to bar the right of the District to seek or obtain judicial relief from a violation of any provision of this chapter, or any rule, regulation, requirement or directive promulgated thereunder. Neither the existence of other remedies identified in said chapter nor the exercise thereof shall be deemed to bar or otherwise limit the right of the District to recover monetary damages for such violation by the Grantee, or judicial enforcement of the Grantee's obligations by means of specific performance, injunction relief or mandate, or any other judicial remedy at law or in equity.

(Ord. 4345 § 1 (part), 2007)