Sebastopol Municipal Code Ch. 5.46 Granting of Franchise for Community Antenna Television System

For the purposes of this chapter, the following terms, phrases, words, abbreviations, and their derivations shall have the meaning given herein:

“CATV” or “community antenna television system” shall mean a system of antennas, coaxial cables, wires, wave guides, or other conductors, equipment or facilities designed, constructed or used for the purpose of providing television or FM radio service by cable or through its facilities as herein contemplated. “CATV” shall not mean or include the transmission of any special program or event for which a separate and distinct charge is made to the subscriber in the manner commonly known and referred to as “pay television.”

“City” shall mean the City of Sebastopol, a municipal corporation of the State of California.

“Council” shall mean the governing body of the City.

“Franchise” shall mean and include any authorization granted hereunder in terms of a franchise, privilege, permit, license, or otherwise to construct, operate and maintain a CATV system in the City. Any such authorization, in whatever term granted, shall not mean and include any license or permit required for the privilege of transacting and carrying on a business within the City.

“Grantee” shall mean the person, firm or corporation to whom or which a franchise as hereinabove defined is granted by the Council under this chapter and the lawful successor, transferee or assignee of said person, firm or corporation.

“Gross annual receipts” shall mean any and all compensation and other consideration in any form whatever and any contributing grant or subsidy received directly or indirectly by a grantee from subscribers or users in payment for television or FM radio signals or service received within the City.

“Property of grantee” shall mean all property owned, installed or used by a grantee in the conduct of a CATV business in the City under the authority of a franchise granted pursuant to this chapter.

“Street” shall mean the surface of and the space above and below any public street, road, highway, freeway, lane, path, alley, court, sidewalk, parkway, or drive, now or hereafter existing as such within the City.

“Subscriber” shall mean any person or entity receiving for any purpose the CATV service of a grantee.

When and in the event that the grantee of any franchise granted hereunder uses in his CATV system distribution channels furnished to the grantee by a telephone company pursuant to tariff or contract on file with the Public Utilities Commission of the State of California, and said grantee makes no use of the streets independent of such telephone company furnished facilities, said grantee shall be required to comply with all of the provisions hereof as a “licensee” and in such event whenever the term “grantee” is used herein it shall be deemed to mean and include “licensee.” No provision of this chapter shall be deemed or construed as to require the granting of a franchise hereunder to a telephone company furnishing such a channel service.

A nonexclusive franchise to construct, operate and maintain a CATV system within all or any portion of the City may be granted by the Council to any person, firm or corporation, whether operating under an existing franchise or not, who or which offers to furnish and provide such system under and pursuant to the terms and provisions of this chapter.

No provision of this chapter may be deemed or construed as to require the granting of a franchise when in the opinion of the Council it is in the public interest to restrict the number of grantees to one or more.

Any franchise granted pursuant to the provisions of this chapter shall authorize and permit the grantee to engage in the business of operating and providing a CATV system in the City, and for that purpose to erect, install, construct, repair, replace, reconstruct, maintain and retain in, on, over, under, upon, across and along any public street, such poles, wires, cable, conductors, ducts, conduit, vaults, manholes, amplifiers, appliances, attachments, and other property as may be necessary and appurtenances, attachments, and other property as may be necessary and appurtenant to the CATV system; and in addition, so to use, operate, and provide similar facilities or properties rented or leased from other persons, firms or corporations, including, but not limited to, any public utility or other grantee franchised or permitted to do business in the City.

No franchise granted hereunder shall be construed as a franchise, permit or license to transmit any special program or event for which a separate and distinct charge is made to the subscriber in the manner commonly known and referred to as “pay television,” and no grantee shall directly or indirectly install, maintain or operate on any television set a coin box or any other device or means for collection of money for individual programs.

The grantee may make a charge to subscribers for installation or connection to its CATV system and a fixed monthly charge as filed and approved as herein provided. No increase in the rates and charges to subscribers, as set forth in the schedule filed and approved with grantee’s application, may be made without the prior approval of the Council by resolution.

No franchise granted by the Council under this chapter shall be for a term longer than 20 years following the date of acceptance of such franchise by the grantee or the renewal thereof. Any such franchise granted hereunder may be terminated prior to its date of expiration by the Council in the event that said Council shall have found, after 50 days’ notice of any proposed termination and public hearing, that:

A. The grantee has failed to comply with any provision of this chapter; or has, by act or omission, violated any term or condition of any franchise or permit issued hereunder; or

B. Any provision of this chapter has become invalid or unenforceable and the Council further finds that such provision constitutes a consideration which is material to the grant of said franchise; or

C. The City acquires the CATV system property of the grantee.

Any grantee granted a franchise under this chapter shall pay to the City, during the life of such franchise, a sum not less than two percent of the gross annual receipts to the grantee. Such payment by the grantee shall be made annually or as otherwise provided in the franchise, by delivery of the same to the Director of Finance. In no event shall the annual payments to the City be less than $100.00 per year.

The grantee shall file with the City, within 50 days after the expiration of any calendar year or portion thereof during which such franchise is in force, a financial statement prepared by a certified public accountant, or person otherwise satisfactory to the Council, showing in detail the gross annual receipts as defined herein, of grantee, during the preceding calendar year or portion thereof. It shall be the duty of the grantee to pay to the City, within 15 days after the time for filing such statements, the sum hereinabove prescribed or any unpaid balance thereof for the calendar year or portion thereof covered by such statements.

The City shall have the right to inspect the grantee’s records showing the gross receipts from which its franchise payments are computed and the right of audit and recomputation of any and all amounts paid under this chapter. No acceptance of any payment shall be construed as a release or as an accord and satisfaction of any claim the City may have for further or additional sums payable under this chapter for the performance of any other obligation hereunder. In the event of any holding over after expiration or other termination of any franchise granted hereunder, without the consent of the City, the grantee shall pay to the City reasonable compensation and damages, of not less than 50 percent of its total gross profits during said period.

A. Any franchise granted under this chapter shall be nonexclusive.

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

C. 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.

D. Any such franchise shall be a privilege to be held in personal trust by the original grantee, it cannot in any event be sold, transferred, leased, assigned or disposed of, in whole or in parts either by forced or involuntary sale, or by voluntary sale, merger, consolidation or otherwise, without the prior consent of the Council expressed by resolutions 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, a duly executed copy of which shall be filed in the office of the City Clerk within 50 days after any such transfer or assignment. The said consent of the Council may not be arbitrarily refused; provided, however, the proposed assignee must show financial responsibility ·and must 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 as a whole to secure an indebtedness.

E. Time shall be of the essence of any such franchise granted hereunder. The grantee shall not be relieved of his obligation to comply promptly with any of the provisions of this chapter or by any failure of the City to enforce prompt compliance.

F. 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.

G. 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.

H. The grantee shall be subject to all requirements of City ordinances, rules, regulations and specifications heretofore or hereafter enacted or established.

I. Any such franchise granted shall not relieve the grantee of any obligation involved in obtaining pole space from any department of the City, utility company, or from others maintaining poles in streets.

J. Any franchise granted hereunder shall be in lieu of any and all other rights, privileges, powers, immunities, and authorities owned, possessed, controlled, or exercisable by grantee, or any successor to any interest of grantee, of or pertaining to the construction, operation, or maintenance, of any CATV system in the City; and the acceptance of any franchise hereunder shall operate, as between grantee and the City, as an abandonment of any and all of such rights, privileges, powers, immunities, and authorities within the City, to the effect that, as between grantee and the City, any and all construction, operation and maintenance by any grantee of any CATV system in the City shall be, and shall be deemed and construed in all instances and respects to be, under and pursuant to said franchise, and not under or pursuant to any other right, privilege, power, immunity or authority whatsoever.

A. 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 either for a term or in perpetuity, the City’s right of eminent domain.

B. There is hereby reserved to the City every right and power which is required to be herein reserved or provided by any ordinance of the City, and the grantee, by its acceptance of any franchise, agrees to be bound thereby and to comply with any action or requirements of the City in its exercise of such rights or powers heretofore or hereafter enacted or established.

C. Neither the granting of any franchise hereunder nor any of the provisions contained herein shall be construed to prevent the City from granting any identical, or similar, franchise to any other person, firm or corporation within all or any portion of the City.

D. There is hereby reserved to the City the power to amend any section or part of this chapter or resolutions adopted pursuant to this chapter so as to require additional or greater standards of construction, operation, maintenance or otherwise, on the part of the grantee.

E. 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.

F. 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 hereunto. The City Manager 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, either the grantee or any member of the public who may be dissatisfied with the decision of the City Manager may appeal the matter to the Council for hearing and determination. The Council may adjust, settle, or compromise any controversy or cancel any charge arising from the operations of any grantee or from any provision of this chapter.

A. Any poles, wires, cable lines, conduits or other properties of the grantee to be constructed or installed in streets shall be so constructed or installed only at such locations and in such manner as shall be approved by the City Engineer acting in the exercise of his reasonable discretion. Prior to commencement of construction or installation of grantee’s property upon any City streets an encroachment permit shall be obtained from the City. Where facilities are installed on a State highway, proper encroachment permits must be obtained from the State of California.

B. The grantee shall not install or erect any facilities or apparatus in or on other public property, places or rights-of-way, or within any privately owned area within the City which has not yet become a public street but is designated or delineated as a proposed public street on any tentative subdivision map approved by the City, except those installed or erected upon public utility facilities now existing, without obtaining the prior written approval of the City Engineer.

C. In those areas and portions of the City where the transmission or distribution facilities of either the public utility providing telephone service or those of the utility providing electric service are underground or hereafter may be placed underground, then the grantee shall likewise construct, operate and maintain all of its transmission and distribution facilities underground, at grantee’s sole cost and expense. For the purpose of this subsection, “underground” shall include a partial underground system, e.g., streamlining. Where complete underground electric and telephone service is provided, grantee shall have his transmission system completely underground, including amplifiers.

D. In the event that transmission or distribution facilities of either the public utility providing telephone service or the utility providing electric service are placed underground to provide expansion of facilities, then the grantee shall likewise install main underground cables in the same trench, or grantee shall dig his own trench and install main underground cables in that trench, in order to provide for future underground connections. The intent of this section is to require that grantee take advantage of required trenching performed by telephone and/or electric utilities when installation is made.

A. In the event that the use of any part of the CATV system is discontinued for any reason for a continuous period of 12 months, or in the event such system or property has been installed in any street or public place without complying with the requirements of grantee’s franchise or this chapter, or the franchise has been terminated, canceled or has expired, the grantee shall promptly, upon being given 10 days’ notice, remove from the streets or public places all such property and poles of such system other than any which the City Engineer may permit to be abandoned in place. In the event of such removal, the grantee shall promptly restore the street or other area from which such property has been removed to a condition satisfactory to the City Engineer.

B. Any property of the grantee remaining in place 30 days after the termination or expiration of the franchise shall be considered permanently abandoned. The City Engineer may extend such time not to exceed an additional 30 days.

C. Any property of the grantee to be abandoned in place shall be abandoned in such manner as the City Engineer shall prescribe. Upon permanent abandonment of the property of the grantee in place, and subject to the provisions of any utility joint use attachment agreement, the property shall become that of the City, and the grantee shall submit to the City Engineer an instrument in writing, to be approved by the City Attorney, transferring to the City the ownership of such property.

The grantee shall, at its expense, protect, support, temporarily disconnect, relocate in the same street or other public place, or remove from the street or other public place, any property of the grantee when required by the City Engineer by reason of traffic conditions, public safety, street vacation, freeway and street construction, change or establishment of street grade, installation of sewers, drains, water pipes, power lines, signal lines, and tracks or any other type of structures or improvements by public agencies; provided, however, that the grantee shall in all such cases have the privileges and be subject to the obligations to abandon any property of the grantee in place, as provided in SMC 5.46.100.

Upon failure of the grantee to commence, pursue or complete any work required by law or by the provisions of this chapter or by its franchise to be done in any street or other public place, within the time prescribed, and to the satisfaction of the City Engineer, the City Engineer may, at his option, cause such work to be done and the grantee shall pay to the City the cost thereof in the itemized amounts reported by the City Engineer to the grantee within 50 days after receipt of such itemized report.

A. The grantee shall, concurrently with the filing of and acceptance of award of any franchise granted under this chapter, file with the City Clerk and at all times thereafter maintain in full force and effect for the term of such franchise or any renewal thereof, at grantee’s sole expense, a corporate surety bond in a company and in a form approved by the City Attorney, in an amount to be determined by the City Council upon the granting of the franchise, or in such other amounts as the corporation surety bond shall be conditioned upon the faithful performance of grantee, and upon the further condition that in the event grantee shall fail to comply with any one or more of the provisions of this chapter, or of any franchise issued to the grantee hereunder, there shall be recoverable jointly and severally from the principal and surety of such bond any damages or loss suffered by the City as a result thereof, including the full amount of any compensation, indemnification, or cost of removal or abandonment of any property of the grantee as prescribed hereby which may be in default, plus a reasonable allowance for attorney’s fees and costs, up to the full amount of the bond, said condition to be a continuing obligation for the duration of such franchise and any renewal by the grantee or from its exercise of any privilege therein granted. The bond shall provide that 30 days’ prior written notice of intention not to renew, cancellation or material change be given to City.

B. Neither the provisions of this section, nor any bond accepted by the City pursuant hereto, nor any damages recovered by the City thereunder, shall be construed to excuse faithful performance by the grantee or limit the liability of the grantee under any franchise issued hereunder or for damages, either to the full amount of the bond or otherwise.

A. The grantee shall, concurrently with the filing of an acceptance of award of any franchise granted under this chapter, furnish to the City and file with the City Clerk and at all times during the existence of any franchise granted hereunder, maintain in full force and effect, at its own cost and expense, a liability insurance policy in the amount of $100,000 in a company approved by the City Manager and in a form satisfactory to the City Attorney, indemnifying and saving harmless the City, its officers and employees from and against any and all claims, demands, actions, suits, and proceedings by others, against all liability for damages by reason of or arising out of any failure by the grantee to secure consents from the owners, authorized distributors or licensees of programs, to be delivered by the grantee’s CATV system, and against any loss, cost, expense and damages resulting therefrom, including reasonable attorney’s fees, arising out of the exercise or enjoyment of its franchise, irrespective of the amount of the comprehensive liability insurance policy required hereunder.

B. The grantee shall, concurrently with the filing of an acceptance of award of any franchise granted under this chapter, furnish to the City and file with the City Clerk, and at all times during the existence of any franchise granted hereunder, maintain in full force and effect, at its own cost and expense, a general comprehensive liability insurance policy in protection of the City, its officers, boards, commissions, agents and employees, in a company approved by the City Manager and a form satisfactory to the City Attorney, protecting the City and all persons against liability for loss or damage for personal injury, death and property damages, occasioned by the operations of grantee under such franchise, with minimum liability limits of $250,000, for personal injury or death of any one person and $500,000 for personal injury or death of two or more persons in any one occurrence and $50,000 for damage to property resulting from any one occurrence.

C. The policies mentioned in subsection B of this section shall name the City, its officers, boards, commissions, agents and employees, as additional insureds and shall contain a provision that a written notice of cancellation or reduction in coverage of said policy shall be delivered to the City 10 days in advance of the effective date thereof; if such insurance is provided by a policy which also covers grantee or any other entity or person other than those above named, then such policy shall contain the standard cross-liability endorsement.

A. At all reasonable times, the grantee shall permit any duly authorized representative of the City to examine all property of the grantee together with any appurtenant property of the grantee situated within or without the City, and to examine and transcribe any and all maps and other records kept or maintained by the grantee or under its control which deal with the operations, affairs, transactions or property of the grantee with respect to its franchise. If any such maps or records are not kept in the City, or upon reasonable request made available in the City, and if the Council shall determine that an examination thereof is necessary or appropriate, then all travel and maintenance expense necessarily incurred in making such examination shall be paid by the grantee.

B. The grantee small prepare and furnish to the City Engineer and the Director of Finance, at the times and in the form prescribed by either of said officers, such reports with respect to its operations, affairs, transactions, or property, as may be reasonably necessary or appropriate to the performance of any of the rights, functions or duties of the City or any of its officers in connection with the franchise.

C. The grantee shall at all times make and keep in the City full and complete plans and records showing the exact location of all CATV system equipment installed or in use in streets and other places in the City.

D. The grantee shall file with the City Engineer on or before the last day in March of each year a current map or set of maps drawn to scale, showing all CATV system equipment installed and in place in streets and other public places of the City.

E. Upon the written request of City, grantee shall submit to the City a copy of the annual proof of performance report that is prepared for the Federal Communications Commission in compliance with Federal standards. The City Council may require any additional information to be submitted by grantee with respect to the quality of service being rendered by grantee including but not limited to an independent professional study of such quality by a consultant approved by City. All of the foregoing reports or studies shall be at the sole cost and expense of grantee.

A. When not otherwise prescribed herein, all matters herein required to be filed with the City shall be filed with the City Clerk.

B. The grantee shall pay to the City a sum of money sufficient to reimburse it for all publication expenses incurred by it in connection with the granting of a franchise pursuant to the provisions of this chapter. Such payment shall be made within 30 days after the City furnishes the grantee with a written statement of such expenses by delivery of same to the Director of Finance.

C. The grantee shall maintain an office within the City limits, or at a location which subscribers may call, without incurring added message or toll charges so that CATV maintenance service shall be promptly available to subscribers.

D. No person, firm or corporation in the existing service area of the grantee shall be arbitrarily refused service; provided, however, that the grantee shall not be required to provide service to any subscriber who does not pay the applicable connection fee or monthly service charge.

E. The grantee shall not engage directly or indirectly in the business of selling, leasing, renting, repairing, supplying same in which said television or other receivers make use of signals transmitted by grantee’s system pursuant to this franchise. If the grantee is a corporation, partnership, or other association of natural persons, this prohibition shall likewise apply to the officers and directors of the grantee, to general or limited partners of any partnership grantee, and to any person or combination of persons who own, hold, or control more than five percent of the corporate stock or other evidence of affiliated or subsidiary corporation owned or controlled by the grantee or by its officers, directors or stockholders, and shall likewise apply to any corporation or entity which acts in the capacity of a holding company or controlling company of the grantee.

When any portion of the CATV system is to be installed on public utility poles and facilities, certified copies of the agreements for such joint use of poles and facilities shall be filed with the City Clerk.

Any franchise granted under this chapter is renewable at the application of the grantee, in the same manner and upon the same terms and conditions as required herein for obtaining the original franchise, except those which are by their terms expressly inapplicable; provided, however, that the Council may at its option waive compliance with any or all of the requirements of SMC 5.46.200.

A. No franchise granted pursuant to the provisions of this chapter shall become effective unless and until the resolution granting same has become effective and, in addition, unless and until all things required in this section and SMC 5.46.130, 5.46.140(A) and (B) are done and completed, all of such things being hereby declared to be conditions precedent to the effectiveness of any such franchise granted hereunder. In the event any of such things are not done and completed in the time and manner required, the Council may declare the franchise null and void.

B. Within 30 days after the effective date of the ordinance awarding a franchise, or within such extended period of time as the Council in its discretion may authorize, the grantee shall file with the City Clerk his written acceptance, in a form satisfactory to the City Attorney, of the franchise, together with the bond and insurance policies required by this chapter and his agreement to be bound by and to comply with and to do all things required of him by the provisions of this chapter and the franchise. Such acceptance and agreement shall be acknowledged by the grantee before a notary public and shall in form and content be satisfactory to and approved by the City Attorney.

A. From and after the effective date of the ordinance codified in this chapter, it shall be unlawful for any person to establish, operate or to carry on the business of distributing to any persons in this City any television signals or radio signals by means of a CATV system unless a franchise therefor has first been obtained pursuant to the provisions of this chapter, and unless such franchise is in full force and effect.

B. From and after the effective date of the ordinance codified in this chapter, it shall be unlawful for any person to construct, install or maintain within any public street in the City, or within any other public property of the City, or within any privately owned area within the City which has not yet become a public street, but is designated or delineated as a proposed public street on any tentative subdivision map approved by the City, any equipment or facilities for distributing any television signals or radio signals through a CATV system, unless a franchise authorizing such use of such street or property or area has first been obtained pursuant to the provisions of this chapter and unless such franchise is in full force and effect.

C. It shall be unlawful for any person, firm or corporation to make any unauthorized connection, whether physically, electrically, acoustically, inductively or otherwise, with any part of a franchised CATV system within the City for the purpose of taking or receiving television signals, radio signals, pictures, programs or sound.

D. It shall be unlawful for any person, firm or corporation to make any unauthorized connection, whether physically, electrically, acoustically, inductively or otherwise, with any part of a franchised CATV system within this City for the purpose of enabling himself or others to receive any television signal, radio signals, pictures, program or sound, without payment to the owner of said system.

E. It shall be unlawful for any person without the consent of the owner to willfully tamper with, remove or injure any cables, wires, or equipment used for distribution of television signals, radio signals, pictures, programs or sound.

F. Any person, firm or corporation violating any of the provisions of this chapter shall be deemed guilty of a separate offense for each, and upon conviction of any such violation, such person shall be punishable as provided for in Section 19 of the Penal Code of the State of California.