Yolo County Municipal Code Art. 15 Compensation and Guarantees to the County

For the use of the streets and for the purposes of providing revenue with which to defray the costs of regulation arising out of the issuance of franchises under this chapter and promoting, assisting, and financing community use programming, PEG programming, and other cable services of a public character, each grantee shall pay franchise fees in the amount prescribed by Section 11-1.1502 of this article. (§ 1, Ord. 961, eff. October 27, 1983, as amended by § 16, Ord. 999, eff. March 7, 1985)

(a) During the term of each franchise, each grantee shall pay to the County an amount equal to five (5%) percent per year of the grantee’s annual gross revenues derived from the operation of the cable communications system.

(b) Such fees shall be paid quarterly not later than August 1, November 1, February 1, and May 1 for the preceding three (3) month period ending, respectively, June 30, September 30, December 31, and March 31. Not later than the date of each payment, each grantee shall file with the Clerk of the Board a written statement signed under penalty of perjury by an officer of the grantee which identifies in detail the sources and amounts of gross revenues received by a grantee during the quarter for which the payment is made.

(c) No acceptance of any payment shall be construed as an accord that the amount paid is, in fact, the correct amount, nor shall such acceptance of payment be construed as a release of any claim which the County may have for further or additional sums payable under the provisions of this section. (§ 1, Ord. 961, eff. October 27, 1983, as amended by § 16, Ord. 999, eff. March 7, 1985)

(a) The County does not have or expect in the foreseeable future to receive sufficient funds with which to defray the costs of administering and regulating cable communications franchises within the Yolo County community. The ability to finance such costs through franchise fees pursuant to the provisions of Section 11-1.1502 of this article constitutes a material inducement to initiate a cable communications program within the community, because the County would not be willing to reduce or eliminate other public programs in order to make public funds available with which to defray the costs of administering and regulating the cable communications program.

(b) Therefore, should any future law or regulation limit or prevent the County from imposing a franchise fee in the amount provided for in this article, each grantee shall make a good faith effort to obtain any possible waiver or permission to pay the full amounts provided for in this article and, to the extent such future law or regulation permits a grantee discretion to make the limitation or prohibition applicable or inapplicable, each grantee shall elect to make the limitation or prohibition inapplicable.

(c) The failure of the County to receive the fees prescribed by Sections 11-1.1501 and 11-1.1502 of this article, and as otherwise permitted by law, shall be deemed to constitute a substantial and material failure to comply with the franchise documents. (§ 1, Ord. 961, eff. October 27, 1983, as amended by § 4, Ord. 965, eff. November 3, 1983)

(a) The County Auditor-Controller, from time to time, during the term of a franchise, may prescribe standards governing the nature, extent, and type of accounting system and accounting procedures utilized by a grantee and require changes in accounting standards or procedures utilized by a grantee for the purpose of promoting the efficient administration of the franchise pursuant to the provisions of this chapter. Any such standards shall be in writing, shall be filed with the Clerk of the Board, and shall be mailed to the grantee to whom directed. A grantee shall promptly comply with all such standards.

(b) During the term of each franchise, the County, not more frequently than once each year, may conduct an audit of the books, records, and accounts of the grantee for the purpose of determining whether the grantee has paid franchise fees in the amounts prescribed by Section 11-1.1502 of this article. The audit may be conducted by the County Auditor-Controller or by an independent certified public accounting firm retained by the County and shall be conducted at the sole expense of the County. The party conducting the audit shall prepare a written report containing its findings, and the report shall be filed with the Clerk of the Board. Notwithstanding the provisions of this subsection, the County shall conduct such an audit at any time if requested to do so by the County. The cost of such an audit so requested shall be borne by and at the sole expense of the County, and the cost shall be paid within thirty (30) calendar days following the receipt of the billing therefor by the County. The report of the audit shall be filed and mailed as prescribed in this subsection.

(c) At any time during the term of a franchise, the County, through its County Auditor-Assessor or a certified public accounting firm which it retains, and at its sole expense, may conduct an audit of the books, records, and accounts of the grantee for the purpose of identifying any information which the Board deems necessary to obtain for the purpose of administering the franchise under the provisions of this chapter. A written report of such audit shall be filed with the Clerk of the Board and mailed to the grantee. The grantee shall comply with any recommendations or directives set forth in such report respecting changes in its accounting system.

(d) Each grantee shall make available for inspection by authorized representatives of the County its books, accounts, and all other financial records at reasonable times and upon reasonable advance notice for the purpose of permitting the exercise of the authorities conferred by this section. (§ 1, Ord. 961, eff. October 27, 1983)

The period of limitation for the recovery of any franchise fees payable pursuant to the provisions of Section 11-1.1502 of this article shall be five (5) years after the date on which payment by the grantee is due. Unless within five (5) years after said date the County initiates recovery pursuant to the provisions of Section 11-1.1506 of this article, recovery shall be barred. Delinquent franchise fees shall bear interest at an annual rate equivalent to that Federal Reserve Discount Rate on advances to member banks in effect on January 2, April 1, July 1, and October 1 for the succeeding quarter of delinquency. The interest shall be compounded quarterly at the end of each quarter. In addition to interest as prescribed in this section, a ten (10%) percent per annum penalty shall be paid on all delinquent franchise fees in recognition of the fact that fluctuating interest rates on borrowed funds make it impossible to establish a reliable interest rate standard as a measure of damages for delinquencies in the payment of franchise fees, and other elements of damages resulting from delinquencies, such as the inadequacy of revenue with which to adequately administer and enforce the franchise, arising out of such delinquencies are subjective and impossible to estimate. (§ 1, Ord. 961, eff. October 27, 1983)

(a) In the event a grantee fails to pay franchise fees pursuant to Section 11-1.1502 of this article, or the Board determines that a grantee has paid franchise fees in a lower amount or amounts than prescribed, written notice thereof shall be mailed to the grantee. The notice shall show the basis for the determination that fees are owing, and the amount thereof, if known, and may show the amount of interest and penalties accumulated to date.

(b) Within thirty (30) calendar days following the date of the mailing of such notice, the grantee may pay any amount stated in the notice, plus interest and penalties, without protest. Any payment made without the accompaniment of a written statement of protest shall constitute a waiver of the right to request arbitration or other relief respecting any and all amounts so paid.

(c) Within thirty (30) calendar days following the date of the mailing of such notice, the grantee, alternatively, may file a written request for arbitration with the Clerk of the Board objecting to the payment, and specifically identifying why an objection is made, and wherein the grantee disagrees with the determination. At the time of filing such a request for arbitration, the grantee may deposit with the County, under protest, any amount, including interest and penalties, which the grantee estimates to be in dispute. Any such deposit shall be accompanied by a written statement by the grantee stating that the amount deposited is pursuant to protest and a request for arbitration. From and after the date of any such deposit, interest and penalties on such amount shall accrue subsequent to the date of the deposit. In the event it is finally determined that the whole or any portion of an amount so deposited under protest was not owing by the grantee, such amount, without interest, shall be credited against and reduce the amount of the franchise fees which become owing by the grantee subsequent to the date of such final determination; provided, however, no such future payment shall be reduced as such a credit by an amount greater than ten (10%) percent of the franchise fee payment otherwise owing; and provided, further, in no event shall the County become or be liable to the grantee for the reimbursement of any portion of an amount so deposited under protest, except as a credit against any future franchise fees which become owing.

(d) If the notice to the grantee by the County shows the amount of franchise fees owing, including interest and penalties, the Board’s determination shall become final and conclusive, not subject to judicial review or reversal by any authority and judicially enforceable, unless the grantee requests arbitration within the time and in the manner prescribed in this section.

(e) If the grantee fails to either pay the franchise fees without protest or requests arbitration, and if the notice by the County does not specify the amount of franchise fees, including interest and penalties, owing, or if the grantee pays an amount without protest, and the Board disagrees that the amount paid is the amount owing, the Board, at its sole discretion, may request arbitration by mailing a written notice of its election to arbitrate to the grantee.

(f) If arbitration is requested, the arbitration panel shall be selected, the hearing scheduled within the time prescribed, notice given, the hearing conducted, a decision made, and the costs divided in the manner prescribed by Sections 11-1.1214 through 11-1.1219 of Article 12 of this chapter. The discovery provisions of the California Arbitration Act (Sections 1280, et seq. of the Code of Civil Procedure of the State) shall be applicable to the arbitration proceedings under this section. The questions which may be submitted to the arbitration panel and the jurisdiction of the arbitration panel shall be limited to the following:

(1) The interpretation of the provisions of the franchise documents solely in relation to the decision required by subsection (g)of this section; and

(2) The amount, if any, owing by the grantee.

(g) The grantee shall immediately pay any amount determined to be owing by the arbitration panel. The arbitration award may be judicially enforced, shall be final, binding, and conclusive upon the parties, and shall not be subject to judicial review or vacation, except on the grounds set forth in Section 1286.2 of the Code of Civil Procedure of the State. (§ 1, Ord. 961, eff. October 27, 1983)

(a) The amount of the franchise fees prescribed by Section 11-1.1502 of this article has been established pursuant to limitations set forth in Section 602 of the Act.

(b) In the event such limitations upon the amount of franchise fees, during the term of any franchise issued pursuant to the provisions of this chapter, should be increased or eliminated, the grantee, upon a request by the County, shall enter into negotiations with the County for the purpose of formulating a mutually agreeable increase in the franchise fees prescribed by said Section 11-1.1502.

(c) Any agreement relating to such an increase shall be embodied in a written contract between the County and the grantee, which shall be deemed to amend said Section 11-1.1502 respecting the amount of the fees. If, within ninety (90) calendar days following the date of a request by the County for negotiations, mutual agreement has not been reached respecting an amendment of the provisions of said Section 11-1.1502 increasing the fees, the Board may cause written notice of its request to arbitrate to be mailed to each concerned grantee and the County. The notice shall specifically identify the amount of increase in fees which the Board desires to submit to arbitration and shall describe the nature and amount of uncompensated costs which the County incurs or desires to incur in administering the franchise or franchises and promoting, assisting, and regulating the various types of access use.

(d) The arbitration panel shall be selected, the hearing scheduled within the time prescribed, notice given, the hearing conducted, a decision made, and the costs divided in the manner prescribed by Sections 1-1.1214 through 11-1.1219 of Article 12 of this chapter. Parties to the arbitration proceeding may include each grantee who would be affected by an amendment of said Section 11-1.1502 and the County. The questions which may be submitted to the arbitration panel and the jurisdiction of the panel shall be limited to:

(1) The interpretation of the provisions of the franchise documents solely in relation to the determination required by subsection (e)of this section; and

(2) The amount, if any, by which the franchise fees prescribed by said Section 11-1.1502 may be increased.

(e) The arbitration panel shall authorize an increase in the franchise fees by an amount which the panel finds is justified by actual (including past uncompensated) or proposed costs incurred by the County in administering each franchise issued pursuant to the provisions of Sections 11-1.901 through 11-1.905 of Article 9 of this chapter provided that the annual franchise fee shall under no circumstances exceed ten (10%) percent per year of a grantee’s annual gross revenues. In the event more than one franchise is issued pursuant to the provisions of this chapter, the arbitration panel shall establish such an amount with respect to each grantee. Any increase ordered by the arbitration panel shall be deemed to amend the provisions of said Section 11-1.1502 respecting the amount of fees. The County shall be authorized to amend said Section 11-1.1502 by increasing the franchise fees by any amount authorized under the decision of the arbitration panel.

(f) Negotiations and arbitration proceedings pursuant to this section may be initiated by the County not more frequently than once each year during the remainder of the term of any franchise issued pursuant to the provisions of this chapter following the increase of or elimination of the statutory and regulatory limitations upon the amount of franchise fees which may be charged under State and Federal laws.

(g) The arbitration award pursuant to this section may be judicially enforced, shall be final, binding, and conclusive upon the parties, and shall not be subject to judicial review or vacation, except on the grounds set forth in Section 1286.2 of the Code of Civil Procedure of the State. (§ 1, Ord. 961, eff. October 27, 1983, as amended by § 17, Ord. 999, eff. March 7, 1985)

(a) Each grantee shall file with the certificate of acceptance which it files pursuant to the provisions of Section 11-1.605 of Article 6 of this chapter, and at all times thereafter maintain in full force and effect, an acceptable corporate surety bond in the amount of Seven Hundred Fifty Thousand and no/100ths ($750,000.00) Dollars, effective for the entire term of the franchise, and conditioned that in the event the grantee shall fail to comply with any one or more of the provisions of the franchise documents, whether or not the franchise is terminated, then there shall be recoverable jointly and severally from the principal and surety of such bond any damages suffered by the County as a result thereof, including, but not limited to, the full amount of any liquidated damages, delinquent franchise fees, compensation and costs of repairing or completing the cable communications system, and compensation and costs of the removal or abandonment of property and the repair of streets and other public or private improvements, up to the full amount of the bond. Such condition shall be a continuing obligation for the duration of the franchise and thereafter until the grantee has satisfied all of its obligations which may have arisen from the acceptance of the franchise or from its exercise of any privileges thereunder. Neither the provisions of this section, any bond accepted pursuant thereto, nor any damages recovered thereunder shall be construed to excuse faithful performance by the grantee or to limit the liability of the grantee under the franchise or for damages, either to the full amount of the bond or otherwise. The bond shall contain a provision which prohibits cancellation by the surety during the term of the franchise, whether for failure to pay a premium or otherwise, without thirty (30) calendar days’ advance written notice mailed by the surety to the Clerk of the Board.

(b) The form of the bond and surety shall be subject to approval by the County Counsel.

(c) On or after the date of the issuance of the final order of completion pursuant to the provisions of Section 11-1.1101 or 11-1.1102 of Article 11 of this chapter, the Board, in its sole discretion, may reduce, for the remainder of the term of the franchise, the required amount of the bond to a sum not less than Two Hundred Fifty Thousand and no/100ths ($250,000.00) Dollars. (§ 1, Ord. 961, eff. October 27, 1983)

(a) Each grantee shall file with the certificate of acceptance which it files pursuant to the provisions of Section 11-1.605 of Article 6 of this chapter a certified or cashier’s check in the amount of Five and no/100ths ($5.00) Dollars for each dwelling to be served, made payable to the order of the County. The check shall be cashed and the proceeds retained by the Treasurer-Tax Collector in a special account. Such sum shall be maintained by the Treasurer-Tax Collector as security for the faithful performance by the grantee of all the provisions of the franchise documents, any damages, including, but not limited to, liquidated damages, delinquent franchise fees, compensation and costs of completing or repairing the cable communications system, and compensation and costs of the removal of abandoned property and the repair of streets and other public or private improvements incurred as a result of the failure of the grantee to comply with the provisions of the franchise documents, and shall be payable from the account upon the terms, conditions, and under the procedures prescribed by Section 11-1.1502 of this article. Interest earned upon the sum shall accrue to the credit of the account; provided, however, the County shall pay to the grantee any sums in the account in excess of the amount required for the original deposit.

(b) Within ten (10) calendar days after notice is mailed to the grantee that any amount has been withdrawn from the special account, the grantee shall deposit with the Treasurer-Tax Collector such sum as may be necessary to restore the account to its required amount.

(c) On the date of the issuance of the final order of completion pursuant to Section 11-1.1101 or 11-1.1102 of Article 11 of this chapter, the County shall reduce the amount of such security deposit by paying so much thereof to the grantee as will reduce the amount of said deposit retained to Two and 50/100ths ($2.50) Dollars for each dwelling to be served, unless on said date there are scheduled or pending, or intended to be scheduled or pending, proceedings relating to the alleged violation by the grantee of any of the provisions of Section 11-1.1002 of Article 10 of this chapter. In such event, the reduction shall not occur, and payment shall not be made until such proceedings are terminated and any damages determined to be owing compensated. Subsequent to such reduction and payment, such deposit shall be maintained at Two and 50/100ths ($2.50) Dollars, plus interest accumulations credited thereto during the remainder of the term of the franchise.

(d) Upon the termination of the franchise and the satisfaction of any damages, including liquidated damages, which may be due, the balance of the special account, including all interest credited thereto, shall be returned to the grantee.

(e) The rights reserved with respect to the special account are in addition to all rights of the County, whether reserved by the franchise documents or authorized by law, and no action, proceeding, or exercise of a right with respect to such account shall affect any other right which the County may have; nor shall the amount of the special account constitute a monetary limit on the liability for any actual or liquidated damages resulting from a breach of the franchise documents. (§ 1, Ord. 961, eff. October 27, 1983)

(a) Each grantee, at its sole expense, shall fully indemnify, defend, and hold harmless the County, and, in their capacity as such, the officers, agents, and employees thereof, from and against any and all claims, suits, actions, liability, and judgments for damages or otherwise:

(1) For actual or alleged injuries to persons or property, including the loss or use of property due to an occurrence, whether or not such property is physically damaged or destroyed, in any way arising out of or through, or alleged to arise out of or through, the acts or omissions of the grantee, or its officers, agents, employees, or contractors, or to which the grantee’s, or its officers, agents, employees, or contractors, acts or omissions in any way contribute;

(2) Arising out of, or alleged to arise out of, any claim for damages for invasion of the right of privacy, defamation of any person, firm, or corporation, or the violation or infringement of any copyright, trademark, trade name, service mark, or patent, or of any other right of any person, firm, or corporation; and

(3) Arising out of, or alleged to arise out of, the grantee’s failure to comply with the provisions of any statute, regulation, or ordinance of the United States, State, or any local agency applicable to the grantee in its business.

(b) The indemnification and hold harmless provisions of this section shall include those prescribed by Section 11-1.1309 of Article 13 of this chapter.

(c) Nothing set forth in this section shall be deemed to prevent the parties indemnified and held harmless from participating in the defense of any litigation by their own counsel at the grantee’s sole expense. Such participation shall not under any circumstances relieve the grantee from its duty of defense against liability or of paying any judgment entered against such party. (§ 1, Ord. 961, eff. October 27, 1983)

The grantee at all times shall maintain in full force and effect a policy of insurance in such form as the County may require, executed by an insurance company authorized to write the required insurance, and approved by the Insurance Commissioner of the State, insuring the payment of any sum which the grantee or the County, or its officers, boards, commissioners, agents, and employees may become obligated to pay by reason of any liability imposed upon them by law for damages because of personal injury or death, or injury to or destruction of property that may result to any person or property arising out of the construction, operation, or maintenance of any facilities pursuant to a franchise. The sums, payment of which shall be so insured, shall not be less than Two Million and no/100ths ($2,000,000.00) Dollars combined single limits, including bodily injury liability and property damage liability. Such policy of insurance shall be filed with the Board and approved as required by County ordinance. (§ 1, Ord. 961, eff. October 27, 1983)

Upon being granted a franchise, and upon the filing of the acceptance required under Section 11-1.605 of Article 6 of this chapter, the grantee shall file with the Clerk of the Board and shall thereafter, during the entire term of such franchise, maintain in full force and effect workers’ compensation insurance coverage in at least the minimum amounts required by law. If a grantee shall fail to obtain or maintain such required insurance coverage, the County, without notice to the grantee, may obtain at the grantee’s sole expense such coverage or forthwith terminate, without prior notice, the franchise as granted. (§ 1, Ord. 961, eff. October 27, 1983)

Each grantee shall cause each insurance policy obtained by it to provide that the insurance policy obtained by it provide that the insurance company waives all right of recovery by way of subrogation against the County, and, in their capacities as such, the officers, agents, and employees thereof, in connection with any damage covered by any policy. The County, and, in their capacities as such, the officers, agents, and employees thereof, shall not be liable to the grantee for any damage caused by any of the risks insured against under an insurance policy obtained by the grantee. (§ 1, Ord. 961, eff. October 27, 1983)