TITLE VI—BUSINESS, PROFESSIONS AND TRADES

CHAPTER 4—CABLE SYSTEMS AND OPEN VIDEO SYSTEMS

(Ord. 1110. eff. 10/02/1987, repealed by Ord. 1343, eff. 6/04/2004)

ARTICLE 1—GENERAL PROVISIONS

Sec. 6500 Purposes.

The purposes of this chapter are as follows:

A.    To establish a local policy concerning cable systems, open video systems, and private communication systems that use the public rights-of-way in a manner that manages such uses for the most efficient and best use, while minimizing costs to taxpayers, protecting against foreclosure of future economic expansion because of premature exhaustion of the public rights-of-way as an economic resource, and minimizing the inconvenience to and negative effects upon the public from such facilities’ construction, emplacement, relocation, and maintenance in the public rights-of-way;

B.    To promote the availability of high-quality and diverse cable services to City residents, businesses, the City of Arcata, and other public institutions; and to promote the availability of diverse information resources to the community, including through the development of advanced systems that can support public, educational, and governmental programming and high-speed access to the internet;

C.    To provide opportunities to the public to obtain access to communications facilities for the purpose of disseminating and receiving information; to promote competitive cable rates and services; to take advantage of opportunities presented by cable and open video systems to provide for more open government; to enhance educational opportunities throughout the community and provide opportunities for building a stronger community; and to allow flexibility to respond to changes in technology, subscriber interests, and competitive factors that will affect the health, welfare, and well-being of the community; and

D.    To encourage economic development while preserving aesthetic and other community values and prevent proliferation of above ground facilities.

Sec. 6501 Definitions.

For the purposes of this chapter, the following terms, phrases, words, and abbreviations shall have the meanings given herein. When not inconsistent with the context, words used in the present tense include the future tense; words in the plural number include the singular number; and words in the singular number include the plural number; and the masculine gender includes the feminine gender. The words "shall" and "will" are mandatory, and "may" is permissive. Words not defined in this chapter shall have the same meaning as in Title VI of the Communications Act of 1934, as amended, 47 USC § 521 et.seq. and, if not defined therein, their common and ordinary meaning. References to governmental entities (whether persons or entities) refer to those entities or their successors in authority. If specific provisions of law referred to herein are renumbered, then the reference shall be read to refer to the renumbered provision. References to laws, ordinances or regulations shall be interpreted broadly to cover government actions, however nominated, and include laws, ordinances and regulations now in force or hereinafter enacted or amended.

A.    "Access," "PEG access," or "PEG use" refers to the availability of a Cable system or open video system for public, education or government use (including Institutional Network use) by various agencies, institutions, organizations, groups, and individuals, including the City of Arcata and its designated access providers, to acquire, create, and distribute programming not under a franchisee’s editorial control, including, but not limited to:

1.    "Public access" or "Public use" means access where organizations, groups, or individual members of the general public, on a non-discriminatory basis, are the primary or designated programmers or users having editorial control over their communications;

2.    "Education access" or "Education use" means access where accredited educational institutions are the primary or designated programmers or users having editorial control over their communications;

3.    "Government access" or "Government use" means access where government institutions or their designees are the primary or designated programmers or users having editorial control over their communications;

B.    "Affiliate" means a Person that (directly or indirectly) owns or controls, is owned or controlled by, or is under common ownership or control with, another Person.

C.    "Basic service" means any service tier regularly provided to all Subscribers which includes the retransmission of local television broadcast signals.

D.    "Cable Act" means the Cable Communications Policy Act of 1984, 47 U.S.C. §§ 521 et seq., as amended by the Cable Television Consumer Protection and Competition Act of 1992, as further amended by the Telecommunications Act of 1996, as further amended from time to time.

E.    "Cable Communications System" refers to open video systems (OVS) and Cable systems.

F.    "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 or more television broadcast stations;

2.    a facility that serves Subscribers without using, or connecting to a facility that uses, any public right-of-way within the City of Arcata;

3.    a facility of a common carrier which is subject, in whole or in part, to the provisions of Title II (Common Carriers) of the Communications Act of 1934, as amended, except that such facility shall be considered a Cable system (other than for purposes of 47 U.S.C. § 541(c)) to the extent such 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.    any facilities of any electric utility used solely for operating its electric utility systems; or

5.    an OVS that is certified by the FCC. Any reference to a Cable system includes the Cable system as a whole, or any part thereof, including all facilities, pedestals, equipment cabinets, electronic equipment and devices appurtenant to the system.

G.    "Cable service" means:

1.    the one-way transmission to Subscribers of (i) video programming, or (ii) other programming service, and

2.    subscriber interaction, if any, which is required for the selection or use of such video programming or other programming service.

H.    "Channel" means a portion of the electromagnetic frequency spectrum which is used in a Cable system or OVS and which is capable of delivering a television signal whether in an analog or digital format. The definition does not restrict the use of any Channel to the transmission of analog television signals or one way transmission.

I.    "City" means the City of Arcata in its present incorporated form and all departments, divisions, and agencies thereof, or any later reorganized, consolidated, enlarged, or reincorporated form.

J.    "City Manager" means the City Manager or the City Manager’s designee.

K.    "Construction, operation or repair" and similar formulations of that term means the named actions interpreted broadly, encompassing, among other things, installation, extension, maintenance, replacement of components, relocation, undergrounding, grading, site preparation, adjusting, testing, make-ready, and excavation.

L.    "Downstream channel" means a Channel designed and activated to carry a transmission from the headend to other points on a Cable Communications System, including interconnections.

M.    "FCC" means the Federal Communications Commission.

N.    "Franchise" refers to an authorization granted by the City to the Operator of a Cable communications giving the Operator the non-exclusive right to occupy the space, or use facilities upon, across, beneath, or over Public Rights-of-Way in the City, to provide specified services within a franchise area.

O.    "Franchise area" means the area of the City that a Franchisee is authorized to serve by the terms of its Franchise or by operation of law.

P.    "Franchisee or Grantee" refers to a Person holding a Cable Communications System Franchise granted by the City.

Q.    "Franchise Fee." In consideration of the grant and exercise of a Franchise to construct, install, operate, or provide services using a Cable Communications System in the Public Rights-of-Way, a Grantee shall pay to the City a Franchise Fee expressed as a percentage of Gross Revenues. The Franchise shall specify the fee to be paid, and the Gross Revenues to be included in the fee calculation. If a Franchise granted pursuant to this chapter specifies a Franchise Fee established as the result of limiting applicable law, the City shall have the option to renegotiate the amount of the Franchise Fee upon a change in applicable law. Nothing herein requires a Person to pay amounts in excess of any limits that may be established by state or federal law.

R.    "Gross Revenues" means all cash, credits, property, or other consideration of any kind or nature received directly or indirectly by a Grantee or its Affiliates, from any source whatsoever arising from, attributable to, or in any way derived from a Grantee’s operation of a Cable system within the Franchise Area. Gross Revenues include, but are not limited to, fees charged to Subscribers for Basic service; fees charged to Subscribers for any optional, premium, per-channel, or per-program service; monthly fees charged to Subscribers for any tier of service other than Basic service; installation, disconnection, re-connection, and change-in-service fees; leased channel fees; fees, payments, or other payment received as consideration from programmers for carriage of programming on the Cable system; converter rentals or sales; studio rental, production equipment, and personnel fees; advertising revenues, including a per capita share of advertising revenues for advertising carried on more than one Cable system; revenues from home shopping channels; sales of programming guides; and such other revenue sources as may now exist or hereafter develop. The definition shall be interpreted in a manner which permits the City to collect the maximum Franchise fee permitted by law, irrespective of the source of revenue. Gross Revenues, however, shall not include any bad debt (defined as unpaid Subscriber or advertiser accounts), any taxes on services furnished to a Grantee and imposed directly upon any Subscriber or user by the state, City, or other governmental unit and collected by a Grantee on behalf of said governmental unit. The amount paid as a Franchise fee shall not be deducted from Gross Revenues unless required to be deducted under federal law.

S.    "License" refers to the legal authorization, terminable at will, to use a particular, discrete, and limited portion of the Public Rights-of-Way to construct, operate, or repair a Communications Facility.

T.    "Operator" when used with reference to a system, refers to a Person or group of persons

1.    who provides service over a Cable Communications System and directly or through one or more Affiliates owns a significant interest in such Cable Communication System; or

2.    who otherwise controls or is responsible for, through any arrangement, the management and operation of such a Cable Communication System facility.

U.    "OVS" means an open video system within the meaning of federal law. A reference to an OVS includes pedestals, equipment enclosures (such as equipment cabinets), amplifiers, power guards, nodes, cables, fiber optics and other equipment necessary to operate the OVS, or installed in conjunction with the OVS.

V.    "Person" includes any individual, corporation, partnership, association, joint stock company, trust, or any other legal entity, but not the City.

W.    "Public Rights-of-Way" means the surface of and the space above and below any street, road, highway, freeway, bridge, lane, path, alley, court, sidewalk, parkway, drive, or right-of-way or easement dedicated for compatible uses, now or hereafter existing within the City which may be properly used for the purpose of installing, maintaining, and operating a Cable Communications System; and any other property that a Franchisee is entitled by state or federal law to use by virtue of the grant of a Franchise.

X.    "Public property" means any property that is owned or under the control of the City that is not a Public Right-of-Way, including, for purposes of this chapter, but not limited to, buildings, parks, poles, structures in the Public Rights-of-Way such as utility poles and light poles, or similar facilities or property owned by or leased to the City.

Y.    "Revocation" means the City’s affirmative act of terminating a Franchise.

Z.    "School" means any accredited primary School, secondary School, college, and university.

AA.    "Subscriber" means the City or any Person who is lawfully receiving, for any purpose or reason, any cable service via a Cable Communications System, whether or not a fee is paid for such service.

BB.    "Termination" means the conclusion of a Franchise by any means, including, but not limited to, by expiration of its term, abandonment, or Revocation.

CC.    "Transfer" means any transaction in which:

1.    all or a portion of any Cable Communication System or any rights to use or operate facilities located in the Public Rights-of-Way are sold, conveyed, transferred, assigned, encumbered (except as set forth herein) or leased, in whole or in part, directly or indirectly, by one or more transactions to another Person, whether voluntarily or by operation of law or otherwise; or

2.    there is any change, acquisition, or transfer in the identity of the Person in control of the Grantee, or any Person that controls Grantee, including, without limitation, forced or voluntary sale, merger, consolidation, or receivership; or

3.    the rights or obligations under the Franchise are sold, conveyed, transferred, assigned, encumbered (except as set forth herein) or leased, in whole or in part, directly or indirectly, by one or more transactions to another Person, whether voluntarily or by operation of law or otherwise. It will be presumed, for purposes of clause (2) above, that any transfer or cumulative transfer of a voting interest by a Person or group of Persons acting in concert of ten percent (10%) or more of Grantee, or Person that controls Grantee, or any change in the managing general partners of a Grantee is a change of control.

"Transfer" does not include:

1.    a lease of channel capacity pursuant to 47 U.S.C. Sections 532 or 573;

2.    the transmission of a commodity or electronic signal using facilities on a common carrier basis;

3.    a lease or other right to use the Cable Communications System mandated pursuant to 47 U.S.C. Section 224, or

4.    a pledge in trust, mortgage or other encumbrance against the Cable Communications System, or any portion thereof, given to a bona fide institutional lender in connection with a loan or other financing required to secure the construction, operation, or repair of the Cable Communications System ("Loan") provided that such Loan is subject to the rights and powers of the City pursuant to the Franchise and applicable law, including, without limitation, the right of the City to approve any Transfer upon foreclosure. "Transferring" and "Transferee" shall have correlative meanings.

DD.    "Upstream channel" means a Channel designed and activated to carry transmissions from a point on the Cable Communications System, other than the headend, to the headend or another point on the Cable Communications System.

EE.    "User" means a Person or the City utilizing a Channel, capacity or equipment and facilities for purposes of producing or transmitting material, as contrasted with the receipt thereof in the capacity of a Subscriber.

Sec. 6502 Franchise required.

No Person may construct or operate a Cable Communications System in the City without first obtaining a grant of a Franchise from the City.

Sec. 6503 Exceptions to Franchise requirement.

The following Persons or entities shall not be required to obtain a Franchise under this chapter:

A.    The City of Arcata;

B.    A UVPP (unaffiliated video program provider) that is only delivering Cable Service or other communications service (as that term is used in 47 U.S.C. Section 542(h)) to Subscribers.

Sec. 6504 Failure to obtain a Franchise.

Consistent with the requirements of due process, a Person’s failure to obtain a Franchise as required by this chapter may, in the City’s discretion, result in:

A.    Forfeiture, by operation of law, of the Person’s Cable Communication System located in the Public Rights-of-Way that are not authorized by an existing Franchise; and/or

B.    A requirement that the Cable Communication System be removed, and that penalties and damages be paid.

Sec. 6505 Existing Franchises.

Grantees of Franchises existing as of the effective date of this chapter shall, in addition to all the obligations and duties prescribed by the terms of their existing Franchises, be subject to the substantive and procedural requirements herein, except as prohibited by applicable law. Nothing herein is intended to invalidate a lawful, existing Franchise or to waive any obligations imposed by such a Franchise. Notwithstanding the foregoing, provisions of this chapter that expressly refer to a "Franchise granted pursuant to this chapter" shall not apply to Franchises initially granted prior to the effective date of this chapter.

Sec. 6506 Form of Franchise.

A Franchise shall be issued in the form of written Agreement, approved by resolution of the City Council, and must be accepted by the Franchisee to become effective.

Sec. 6507 Filing an Application

A person seeking to (A) obtain a Franchise; (B) transfer a Franchise: (C) extend the term of an existing Franchise, (D) renew a Franchise, or (E) modify an existing Franchise to add new Services that are required to be authorized by a Franchise pursuant to this chapter, shall submit a signed original of its application and six (6) copies to the Clerk of the Board. The Clerk of the Board shall make a Proposal available for public inspection. The application must conform to all of the requirements of this chapter. Requests for other types of Franchise modifications may be processed by the City without an application, and submitted for approval. However, nothing herein shall prevent the City from requiring a application in the event the City determines, based on the nature of the requested modification, that the public interest would best be served by the submission of a application pursuant to this chapter.

Sec. 6508 Application Fee.

A.    Reasonable costs. An Applicant shall pay all reasonable costs incurred by the City related to the processing of any application. Processing costs shall include, but not be limited to, the costs of services rendered by any City employee, agent or representative, including consultants and attorneys.

B.    The initial deposit of the application fee for the consideration of an application for issuance, renewal, Transfer, or modification of a Franchise shall be in the amount of $5,000.00, or for a License in the amount of $1,000.00, which deposit shall be submitted with the application. The City of Arcata may, as costs are incurred, draw upon the deposit to recover its administrative costs, including, but not limited to, the reasonable cost of outside consultants retained by the City related to the City’s consideration and processing of a Franchise or License. The City Manager, at any time, may require the applicant to deposit additional sums if it appears that the initial deposit or subsequent deposits will be exhausted prior to the final action by the City relating to the consideration by the City of an application for issuance, renewal, Transfer, or modification of a Franchise or License. The applicant will not be entitled to further consideration by the City of Arcata its requested action until such time as the additional deposit required by the City Manager has been deposited with the City. In the event the amount of the deposit of an applicant is in excess of the amount of the administrative expenses of the City related to the action requested, then the applicant shall be entitled to a return of any such excess amount. In addition, an applicant that is awarded a Franchise or a License shall pay 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 or License. Such payment shall be made to the Auditor-Controller of the City within 30 days after the City furnishes the Franchisee or Licensee with a statement of such expenses.

Sec. 6509 Nature of Franchise.

A.    Scope. A Franchise granted pursuant to this chapter shall authorize and permit a Franchisee to construct, operate, maintain and repair a Cable system, or an OVS (as applicable) to provide Cable service in the City, and for that purpose to erect, install, construct, repair, replace, reconstruct, maintain facilities appurtenant to such system in, on, over, under, upon, across, and along the Public Rights-of-Way, and along such other public property that the City may authorize a Franchisee to use.

B.    Nothing passes by implication. A Franchise shall not convey rights other than as specified in this chapter, or in a Franchise agreement; no rights shall pass by implication.

C.    Franchise not in lieu of other authorization. A Franchise shall not include, or be a substitute for:

1.    compliance with requirements for the privilege of transacting and carrying on a business within the City, including, but not limited to, complying with the conditions the City may establish before constructing facilities for, or providing, non-cable services;

2.    any permit, agreement or authorization required in connection with operations on or in Public Rights-of-Way or Public Property, including by way of example and not limitation, encroachment permits for street construction;

3.    any permits or agreements for occupying any other property of the City or private entities to which access is not specifically granted by the Franchise.

D.    Franchisee must comply with other laws. A Franchise does not relieve a Franchisee of its duty to comply with all the City ordinances and regulations, and every Franchisee must comply with the same. Likewise, the rights granted under a Franchise are subject to the exercise of police and other powers the City now has or may later obtain, including but not limited to the power of eminent domain. Every Franchise shall be deemed to incorporate all the requirements of the City Charter.

E.    Franchise not a grant of property rights. A Franchise does not convey title, equitable or legal, in the Public Rights-of-Way. Rights granted may not be subdivided or subleased.

F.    Franchise non-exclusive. No Franchise shall be exclusive, or prevent the City from issuing other Franchises or authorizations, or prevent the City from itself constructing, operating, or repairing its own Cable Communications System with or without a Franchise.

G.    Franchise term. Every Franchise shall be for a term of years, which term shall be eight (8) years, unless a Franchise specifies otherwise.

H.    Costs borne by Franchisee. Unless otherwise specifically stated in a Franchise, or is required or permitted by law, all acts which a Franchisee is required to perform under the Franchise or applicable law must be performed at the Franchisee’s expense.

I.    Failures to perform. If a Cable Communications System Operator fails to perform work that it is required to perform within the time provided for performance, the City may perform the work and bill the Operator therefor. The Operator shall pay the amounts billed within 30 days.

Sec. 6510 Administration of ordinance; adoption of regulations.

A.    Adoption of regulations. The City of Arcata may from time to time adopt regulations to implement the provisions of this ordinance. This ordinance, and any regulations adopted pursuant to this ordinance, are not contracts with any Franchisee, and may be amended at any time. Nothing in this section shall affect a Franchisee’s right to challenge the lawfulness or applicability of a future exercise of the police or legislative power of the City.

B.    Delegation. The City of Arcata City Manager or their designee(s) are hereby authorized to administer the provisions of this ordinance and any Franchise issued pursuant thereto, and to provide any notices (including noncompliance notices) and to take any action on the City’s behalf that may be required hereunder or under applicable law.

C.    No waiver. The failure of the City, upon one or more occasions, to exercise a right or to require compliance or performance under a Franchise or any other applicable law shall not be deemed to constitute a waiver of such right or a waiver of compliance or performance, unless such right has been specifically waived in writing.

D.    Administration of public, educational and government access. The City may designate one or more entities, including itself, to control and manage the use of public, educational and government access Channels, facilities and equipment.

Sec. 6511 Transfers.

A.    Prior approval required. Every Franchise shall be deemed to be held in trust, and to be personal to the Franchisee. Any Transfer that is made without the prior approval of the City shall be deemed invalid.

B.    Exception for mortgages. Notwithstanding any other provision of this chapter, pledges in trust or mortgages of the assets of a Cable Communications System to secure the construction, operation, or repair of the system may be made without application and without the City’s prior consent. However, no such arrangement may be made without the City’s prior consent if it would in any respect under any condition: (A) prevent the Cable Communications System Operator or any successor from complying with the Franchise or applicable law; or (B) permit a third party to succeed to the interest of the Operator, or to own or control the system, without the prior consent of the City. Any mortgage, pledge or lease shall be subject to and subordinate to the rights of the City under any Franchise, this chapter, or other applicable law.

Sec. 6512 General conditions upon construction, operation and repair.

A.    Franchisee must follow local rules. The construction, operation, and repair of Cable Communications Systems shall be performed in compliance with all lawful and applicable laws, ordinances, departmental rules, regulations, and practices affecting such system. By way of example, and not limitation, this includes zoning and safety codes, construction standards, regulations for providing notice to Persons that may be affected by system construction, and directives governing the time, place and manner in which facilities may be installed in the Public Rights-of-Way. Persons engaged in the construction, operation, or repair of communications facilities shall exercise reasonable care in the performance of all their activities and shall use commonly accepted methods and devices for preventing failures and accidents that are likely to cause damage, injury, or nuisance to the public or to property.

B.    No permit without Franchise. A Franchise is required before a permit may be issued for work associated with the construction of a Cable Communications System. Any permit issued for such work to, or on behalf of, a person that does not hold a Franchise shall vest no rights in the permittee; the permit may be revoked at will, and the permittee shall remove all facilities installed under the permit upon the City’s demand.

C.    Permits must be obtained. Construction, operation, or repair of a Cable Communications System shall not commence until all required permits have been obtained from the proper City officials and all required fees have been paid. All work performed will be performed in strict accordance with the conditions of the permit. Upon order of the City, any work and/or construction undertaken that is not completed in compliance with the City’s requirements, or which is installed without obtaining necessary permits and approvals shall be removed.

D.    No interference. Interference with the use of the Public Rights-of-Way by others, including others that may be installing Cable Communications Systems, must be minimized. The City may require a Person using the Public Rights-of-Way to cooperate with others through joint trenching and other arrangements to minimize adverse impacts on the Public Rights-of-Way.

E.    Plans for and publicizing work. Work shall be publicized as the City may direct from time to time. The publication of work may be used to notify the public and Operators of other communications systems, of the impending work, in order to minimize inconvenience and disruption to the public.

1.    Each Cable Communications System Operator shall provide the City a plan for any initial system construction, or for any substantial rebuild, upgrade or extension of its facility, which shall show its timetable for construction of each phase of the project, and the areas of the City that will be affected.

2.    The City may from time to time, when the City receives application for a permit to use a particular route, or upon its own initiative, designate by published order a route or proposed route for installation of communications facilities and may (a) require all persons who wish to emplace underground facilities along that route or any part thereof to install them during a specified period and (b) otherwise prohibit emplacement of such facilities along the route or any part thereof for 24 months or after such other, longer period as is necessary to protect the public interest.

F.    Existing poles to be used. To the extent possible, Operators of Cable Communications Systems shall use existing poles and conduit. Additional poles may not be installed in the right-of-way, nor may pole capacity be increased by vertical or horizontal extenders, without the permission of the City.

To minimize disruption of public passage or infrastructure, to forestall or relieve exhaustion of Public Rights-of-Way capacity, or to protect environmentally sensitive areas, the City may require as a condition of issuing any Public Rights-of-Way permit for erection of new poles or construction of underground conduit, the installation of which requires excavation of or along any traveled way, that the Franchisee, licensee, or holder of the rights of way permit emplace pole space or empty conduits in excess of its own present and reasonably foreseeable requirements for the purpose of accommodating the City and/or other Franchisees and licensees.

G.    Undergrounding.

1.    Whenever all existing utilities are located underground in an area in the City, every Cable Communications System Operator in the same area must locate its Cable Communications System underground.

2.    Whenever the owner of a pole locates or relocates underground within an area of the City, every Cable Communications System Operator in the same area shall concurrently relocate its facilities underground.

3.    The City of Arcata City Manager may, for good cause shown, exempt a particular system or facility or group of facilities from the obligation to locate or relocate facilities underground, where relocation is impractical, where ordinary engineering practices making undergrounding impractical, or where the City and the Subscriber’s interest can be protected in another manner. Nothing in this Section 6512(G)(3) prevents the City from ordering communications facilities to be located or relocated underground under other provisions of the City Code.

H.    Prompt repairs. Any and all Public Rights-of-Way, other Public property, or private property that is disturbed or damaged during the construction, operation, maintenance or repair of a Cable Communications System shall be promptly repaired by the Operator. Public property and Public Rights-of-Way must be restored to the satisfaction of the City and to a condition as good or better than before the disturbance or damage occurred. No tree trimming shall be performed without the permission of the City and other affected authorities, and any tree trimming must be performed in strict accordance with the City Code.

I.    Movement of facilities for government.

1.    A Cable Communications System Operator shall, within a reasonable period of time specified by the City, protect, support, temporarily disconnect, relocate, or remove any of its property when required by the City by reason of traffic conditions; public safety; Public Right-of-Way construction and repair (including regrading, resurfacing or widening); Public Right-of-Way vacation; construction, installation or repair of sewers, drains, water pipes, power lines, signal lines, tracks, or any other type of government-owned system or utility, public work, public facility, or improvement; or for any other purpose where the work involved would be aided by the removal or relocation of the Cable Communications System. Collectively, such matters are referred to below as the "Public Work."

2.    The City shall provide written notice describing where the Public Work is to be performed as far in advance as reasonably possible but in any event at least one week prior to the deadline by which a Cable Communications System Operator must protect, support, temporarily disconnect, relocate or remove its facilities. Such action on the part of the Franchisee shall be undertaken at no cost to the City. Provided that, in an emergency where a Cable Communications System creates or is contributing to an imminent danger to health, safety, or property, the City need not provide one week’s written notice but should make an effort to contact the Franchisee by telephone to enable the Franchisee to take prompt action. After such effort on the part of the City to contact the Franchisee by telephone, the City may protect, support, temporarily disconnect, remove, or relocate any or all parts of the Cable Communications System without further notice, and charge the Cable Communications System Operator for costs incurred.

J.    Movement for others.

1.    To accommodate the construction, operation, or repair of the facilities of another Person authorized to use the Public Rights-of-Way or Public property, a Franchisee shall, by a reasonable time specified by such person, protect, support, temporarily disconnect, temporarily relocate or temporarily remove its facilities. The Franchisee must be given written notice describing where the construction, operation or repair is to be performed at least fifteen (15) days prior to the time by which its work must be completed.

2.    A Cable Communications System Operator shall, on the request of any Person holding a valid permit issued by a governmental authority, temporarily raise or lower its wires by a time specified to permit the moving of buildings or other objects. A Cable Communications System Operator shall be given not less than seven (7) days advance notice to arrange for such temporary wire changes. The reasonable costs associated with of such temporary removal, relaying, relocation, or raising or lowering of wires shall be paid in advance by the Person requesting the same.

K.    Abandonment in place.

1.    A Cable Communications System Operator may abandon any property in place in the Public Rights-of-Way upon written notice to the City. However, if, within 90 days of the receipt of written notice of abandonment, the City determines, that the safety, appearance, functioning or use of the Public Right-of-Way and facilities in the Public Right-of-Way will be adversely affected, the property must be removed by a date specified by the City.

2.    A Cable Communications System Operator that abandons its property must, upon request, transfer ownership of the properties to the City at no cost, and execute necessary quitclaim deeds and indemnify the City against future costs associated with mitigating or eliminating any environmental hazard associated with the abandoned property.

L.    System subject to inspection. Every Cable Communications System facility shall be subject to inspection and testing by the City upon reasonable prior notice and conditions. Each Operator must respond to requests for information regarding its system and plans for the system as the City may from time to time issue, including requests for information regarding its plans for construction, operation and repair and the purposes for which the plant is being constructed, operated, or repaired.

M.    Underground services alert. Each Operator of a Cable Communications System that places facilities underground shall be a member of the regional notification center for subsurface installations (Underground Services Alert) and shall field mark the locations of its underground communications facilities upon request. The Operator shall identify the location of its Cable Communication System for the City at no charge.

N.    Plan for construction. Every Franchise shall specify for the City a construction schedule that will apply to any required construction, upgrade, or rebuild of the Cable Communications System. The schedule shall provide for the prompt completion of the project, shall show its timetable for construction of each phase of the project, with benchmarks for deliverables and the areas of the City that will be affected. The City shall have the right to impose penalties on the Operator for a failure to meet the accepted timetable and benchmarks.

O.    Use of facilities by the City of Arcata. The City shall have the right to install and maintain, free of charge upon any poles or in any conduit owned by a Franchisee, any wire and pole fixtures that do not unreasonably interfere with the Cable service operations of the Franchisee.

Sec. 6513 Protection of the City of Arcata and Residents.

A.    Indemnity required. No Franchise shall be valid or effective until and unless the City obtains an adequate indemnity from the Franchisee. The indemnity must:

1.    Release the City from and against any and all loss, damage, expense, cost (without limitation the cost of litigation) liability and responsibility in or arising out of the construction, operation or maintenance of the Cable Communications System. Each Cable Communications System Operator must further agree not to sue or seek any money or damages from the City in connection with the above-mentioned matters.

2.    Indemnify, hold harmless, and defend the City, its elected and appointed officers, agents, and employees, from and against any and all liability, loss, damage, cost, claims, demands, or causes of action of any kind or nature, and the resulting losses, costs, expenses, reasonable attorneys’ fees, liabilities, damages, orders, judgments, or decrees sustained by the City or any third party arising out of, or by reason of, or resulting from or of the acts, errors, or omissions of the Cable Communications System Operator, or its agents, independent contractors or employees related to or in any way arising out of the construction, operation or repair of the system.

3.    Provide that the covenants and representations relating to the release, indemnification, and hold harmless provision shall survive the term of the Franchise or other authorization and continue in full force and effect as to the party’s responsibility to indemnify.

B.    Insurance required. A Franchisee (or those acting on its behalf) shall not commence construction or operation of the system without obtaining insurance in amounts and of a type reasonably satisfactory to the City. The required insurance must be obtained and maintained for the entire period the Franchisee has facilities in the Public Rights-of-Way. If the Franchisee, its contractors, or subcontractors do not have the required insurance, the City may order such entities to stop operations until the insurance is obtained and approved.

C.    Proof. Certificates of insurance and Endorsements, reflecting evidence of the required insurance and naming the City as an additional insured, and other proofs as the City may find reasonably necessary, shall be filed with the City. For Persons issued Franchises after the effective date of this ordinance, certificates and other required proofs shall be filed within 30 days of the issuance of a Franchise, prior to the commencement of construction, once a year thereafter, and whenever there is any change in coverage. For entities that have facilities in the Public Rights-of-Way as of the effective date of this chapter, the Certificate and Endorsements shall be filed within 60 days of the effective date of this chapter, annually thereafter, and whenever there is any change in coverage, unless a pre-existing Franchise provides for filing of Certificates and/or Endorsements in a different manner. In the event that the insurance Certificate and/or Endorsements provided indicates that the insurance shall terminate or lapse during the term of the Franchise or License, then in that event, the Cable Communications System Operator shall furnish, at least 30 days prior to the expiration of the date of such insurance, a renewed Certificate of Insurance and Endorsement as proof that equal and like coverage has been or will be obtained prior to any such lapse or termination during the balance of the Franchise or License under which the Cable Communications System operates.

D.    Certificate contents. All Certificates and/or Endorsements shall contain a provision that coverages afforded under these policies will not be canceled until at least 30 days’ prior written notice has been given to the City. Policies shall be issued by companies authorized to do business under the laws of the State of California. Financial Ratings of the insurer shall be no less than "A" VII or better in the latest edition of "Bests Key Rating Guide", published by A.M. Best Guide.

E.    Insurance amounts. A Cable Communications System Operator (and those acting on its behalf to construct or operate the system) shall maintain the following minimum insurance. The City shall be named as an additional insured by Endorsement on the general liability and automotive policies; those insurance policies shall be primary and contain a cross-liability clause.

1.    COMPREHENSIVE GENERAL LIABILITY insurance to cover liability, bodily injury, and property damage. Exposures to be covered are: premises, operations, products/completed operations, and certain contracts. Coverage must be written on an occurrence basis, with the following limits of liability:

Bodily Injury

1.

Each Occurrence

$ 1,000,000

2.

Annual Aggregate

$ 3,000,000

Property Damage

1.

Each Occurrence

$ 1,000,000

2.

Annual Aggregate

$ 3,000,000

Personal Injury

 

Annual Aggregate

$ 3,000,000

Completed Operations and Products Liability shall be maintained for two years after the termination of the Franchise or License (in the case of the Cable Communications System owner or Operator) or completion of the work for the Cable Communications System owner or Operator (in the case of a contractor or subcontractor).

Property Damage Liability Insurance shall include Coverage for the following hazards: X - explosion, C - Collapse, U underground.

2.    WORKERS’ COMPENSATION insurance shall be maintained during the life of this contract to comply with statutory limits for all employees, and in the case any work is sublet, each Cable Communications System Operator shall require the subcontractors similarly to provide workers’ compensation insurance for all the latter’s employees unless such employees are covered by the protection afforded by each Cable Communications System Operator. Each Cable Communications System Operator and its contractors and subcontractors shall maintain during the life of this policy employers liability insurance. Workers’ compensation insurance shall include a waiver of subrogation clause in favor of the City. The following minimum limits must be maintained:

Workers’ Compensation

Statutory

Employer’s Liability

$ 500,000 per Occurrence

3.    COMPREHENSIVE AUTO LIABILITY

Bodily Injury

1.

Each Occurrence

$ 1,000,000

2.

Annual Aggregate

$ 3,000,000

Property Damage

1.

Each Occurrence

$ 1,000,000

2.

Annual Aggregate

$ 3,000,000

Coverage shall include owned, hired, and non-owned vehicles. In every Franchise or License agreement the City shall reserve the right to require any other insurance coverage it deems necessary depending upon exposures.

F.    Performance bond. Every Operator of a Cable Communications System shall obtain and maintain a performance bond to ensure the faithful performance of its responsibilities under this chapter and any Franchise. The amount of the performance bonds shall be set by the City Franchise, but shall not be less than 10 per cent of the estimated cost of constructing or (in the case of existing systems) upgrading the system, and shall include a sufficient amount to cover the removal of facilities and/or restoration of City facilities within the right-of-way. The bond is not in lieu of any additional bonds that may be required through the permitting process. The bond shall be in a form reasonably acceptable to the City Attorney and Risk Manager. Bonds must be obtained prior to the effective date of any Franchise, Transfer or Franchise renewal, unless a Franchise specifically provides otherwise.

G.    Security fund. Every Cable Communications System Operator shall establish and maintain a cash security fund or provide the City an irrevocable letter of credit in the amount of $100,000 to secure the payment of fees owed, to secure any other performance promised in a Franchise, and to pay any taxes, fees, penalties or liens owed to the City. The letter of credit shall be in a form and with an institution acceptable to the City. Should the City draw upon the cash security fund or letter of credit, the Cable Communications System Operator shall, within 14 days, restore the fund or the letter of credit to the full-required amount. This security fund/letter of credit may be waived or reduced by the City for a Franchisee where the City determines in its discretion that a particular Franchisee’s operations are sufficiently limited that a security fund/letter of credit is not necessary to secure the required performance. The City may from time to time require a Franchisee to change the amount of the required security fund/letter of credit to reflect changed risks to the City and to the public, including delinquencies in taxes or other payments to the City. The cash security fund or letter of credit must be obtained prior to the effective date of any Franchise, License, Transfer or Franchise renewal, unless a Franchise specifically provides otherwise.

Sec. 6514 Enforcement and remedies.

A.    Franchise violation-notice and procedures. Before revoking a Franchise or issuing an order to assess liquidated damages, the City shall follow the procedures set forth below:

1.    The City shall notify a Cable Communications System Operator in writing of any alleged violation (" Violation Notice") of a Franchise or this Enabling Ordinance. The Violation Notice shall: (a) identify the violation; (b) direct the Cable Communications System Operator to cure the violation or show cause why the violation cannot or should not be cured; and (3) state the time for the Cable Communications System Operator’s response, which shall be at minimum thirty (30) days from the date of issuance of the Violation Notice, except for violations that present a danger to public health, safety or welfare, in which case the time for response may be shortened.

2.    Within the time period designated for response, the Cable Communications System Operator shall respond in writing to the City indicating that: (a) the Cable Communications System Operator intends to contest the Violation Notice and describing all facts relevant to its claim; or (b) the Cable Communications System Operator has completely cured the violation, in which case the Cable Communications System Operator shall provide documentation demonstrating that the violation has been completely cured; or (c) the Cable Communications System Operator has begun to correct the violation, however, the violation cannot be corrected immediately despite the Cable Communications System Operator’s continued due diligence, in which case the Operator shall describe in detail the steps already taken and Operator’s proposed plan and time schedule for completely curing the violation. Correction of the violation is not complete until all damages and penalties owed are paid in full.

3.    If the Cable Communications System Operator contests the Violation Notice or the City determines that the Cable Communications System Operator has failed to completely cure the violation, to submit an acceptable plan to cure the violation, or to work diligently to cure the violation, the City shall schedule a hearing before the City Council ("Violation Hearing"). City shall provide Cable Communications System Operator written notice of the Violation Hearing at least twenty (20) days prior to the hearing ("Hearing Notice").

4.    The Hearing Notice shall indicate: (a the time and place of the Violation Hearing; (b) the nature of the violation; and (c) the Cable Communications System Operator’s right to present oral and written testimony at an open and public meeting.

5.    At the Violation Hearing, the Board of Supervisors shall hear and consider evidence from the Cable Communications System Operator, City staff and members of the public regarding the alleged violation. The Cable Communications System Operator shall be given an opportunity to present any and all evidence relating to the alleged violation.

6.    If, based upon the evidence presented at the Violation Hearing, the City Council finds that Cable Communications System Operator has violated a Franchise, this Enabling Ordinance or any applicable state or federal law, the Board of Supervisors may issue an order assessing liquidated damages if provided for by the Cable Communications System Operator’s Franchise, or, subject to Section 6514(B) of this chapter the terms of the Cable Communications System Operator’s Franchise, revoke or shorten the Franchise.

B.    Revocation and termination. The City Council may revoke a Franchise or reduce the term of a Franchise if it finds, after complying with procedures set forth above, that a Cable Communications System Operator has violated this chapter or its Franchise or License; has defrauded or attempted to defraud the City or Subscriber; or has attempted to evade the requirements of this chapter or its Franchise or License. Except as to violations that are impossible to cure, and as provided in Sections 6514(C) - (D) the Franchise may only be revoked if the Franchisee (1) was given notice of the default; and (2) 30 days to cure the default; and (3) the Franchisee failed to cure the default, or to propose a schedule for curing the default acceptable to the City where it is impossible to cure the default in 30 days.

C.    Exception for certain acts. No opportunity to cure is required for repeated violations, and fraud and attempted fraud shall be deemed incurable. Further, the City may declare a Franchise forfeited without opportunity to cure where a Franchisee (1) voluntarily stops providing service it is required to provide; or (2) Transfers the Franchise without the prior consent of the City.

D.    Exception for bankruptcy. A Franchise will terminate automatically by force of law 120 calendar days after an assignment for the benefit of creditors or the appointment of a receiver or trustee to take over the business of the Franchisee, whether in a receivership, reorganization, bankruptcy assignment for the benefit of creditors, or other action or proceeding. However, the Franchise may be reinstated within that 120 day period, if: (1) such assignment, receivership or trusteeship has been vacated; or (2) such assignee, receiver or trustee has fully complied with the terms and conditions of this chapter and the Franchise, and has executed an agreement, approved by any court having jurisdiction, assuming and agreeing to be bound by the terms and conditions of this chapter and the Franchise. In the event of foreclosure or other judicial sale of any of the facilities, equipment or property of a Franchisee, the City may revoke the Franchise following a public hearing before the City Council by serving notice upon the Franchisee and the successful bidder at the sale, in which event the Franchise and all rights and privileges thereunder will be revoked and will terminate 30 calendar days after serving such notice, unless: (1) the City has approved the Transfer of the Franchise to the successful bidder; and (2) the successful bidder has covenanted and agreed with the City to assume and be bound by the terms and conditions of the Franchise and this chapter.

E.    Effect of termination or forfeiture. Upon termination or forfeiture of a Franchise, whether by action of the City as provided above, or if a Franchise expires and is not renewed, the Franchisee must stop using the Cable Communications System for the purposes authorized by the Franchise. The City may take possession of some or all of Franchisee’s facilities, or require the Franchisee or its bonding company to remove some or all of the Franchisee’s facilities from the City’s property, and restore affected property to its same or better condition. This provision does not permit the City to remove facilities that are used to provide another service for which the Franchisee holds a valid Franchise issued by the City or if Franchisee’s facilities are otherwise lawfully located on the City property pursuant to applicable local, state or federal law.

F.    Remedies cumulative. Remedies provided for under this chapter or under a Franchise shall be cumulative. Recovery by the City of any amounts under insurance, the performance bond, the security fund or letter of credit, does not limit a Franchisee’s duty to indemnify the City; or relieve a Franchisee of its Franchise obligations or limit the amounts owed to the City.

G.    Liquidated damages required in Franchise: A Franchise granted pursuant to this chapter shall require liquidated damages, in an amount to be specified in the Franchise, for specified breaches of the Franchise including but not limited to, failure to commence construction, failure to meet construction plan benchmarks, failure to comply with rebuild plan benchmarks, failure to commence service, and material breach of Franchise obligation(s). The Franchise shall also provide that the City may withdraw liquidated damages owed from the Grantee’s security deposit, after complying with the procedures set forth in Section 6514.A. Liquidated damages shall commence on that date that performance was due and/or failed, and continue until the Grantee demonstrates to the satisfaction of the City that the Grantee has fully performed its obligations giving rise to the payment of liquidated damages. Any obligation to pay liquidated damages does not in any way affect the Grantee’s obligation to pay Franchise fees or perform other Franchise obligations and such liquidated damages do not constitute Franchise fees and are not subject to any limitations on Franchise fees contained in 47 U.S.C.§ 542(b). Grantee acknowledges that any obligation to pay liquidated damages are not costs of satisfying Franchise requirements as provided in 47 C.F.R § 76.925. Grantee agrees it will not pass the cost of any liquidated damages to Subscribers through Subscriber rates or itemize or otherwise identify on Subscriber bills any obligation Grantee may have to pay liquidated damages.

H.    Penalties, fines and other monetary sanctions

1.    Penalties. In addition to any other remedies provided for in this chapter or otherwise available by law, the City shall have the power to impose monetary penalties in the event a Grantee violates any provision of this chapter, a Franchise, or any regulation lawfully adopted thereunder. The amounts of such penalties shall be specified in the Franchise and shall be based on the following principles.

a.    Penalties shall exceed the financial benefits to a Grantee delaying or failing to comply with the applicable requirement;

b.    Even where such benefits are not easily discernible, the penalties shall be high enough to have a significant deterrent effect on a Grantee; and

c.    Penalties shall be sufficient to protect the City and other affected parties against loss of revenues resulting from violations.

2.    Other monetary sanctions. A Franchise shall also provide for fines, liquidated damages and other monetary sanctions, the amounts of which shall also reflect the foregoing principals.

3.    Private suit against Grantee.

a.    Any person or organization adversely affected by a violation, or by a pattern and practice of violations, shall have the right to sue a Grantee in a court of competent jurisdiction for damages and for injunctive and other relief to require enforcement of the Franchise. Organizations shall be entitled to sue on behalf of themselves or their members.

b.    The remedy herein provided shall be in addition to any remedies provided by law.

c.    Except in emergency situations in which immediate relief is required, private litigants shall notify the City Attorney not fewer than 10 days prior to filing suit. However, suit by the City shall not preempt the private litigant’s right to proceed.

4.    Except as otherwise provided herein, any person who violates any provisions of this chapter shall be subject to a fine not to exceed $500 for each offense; each day of said violation shall constitute a separate offense.

Sec. 6515 Books and Records.

A.    Generally. Each Cable Communications System Operator shall provide the City access to books and records related in whole or in part to the construction, operation, or repair of the Cable Communications System, or a group of systems of which the system is a part, so that the City may inspect and copy these books and records. The records include, but are not limited to revenue records, and other records related to compliance with any provision of this chapter or a Franchise. A Franchisee is responsible for obtaining or maintaining the necessary possession or control of all such books and records, so that it can produce the documents upon request. Books and records must be maintained for a period of five years, except that a Franchise may specify a shorter period for certain categories of voluminous books and records where the information contained therein can be derived simply from other materials. The phrase "books and records" shall be read expansively to include information in whatever format stored.

B.    Production. Books and records requested shall be produced to the City by a time and at a location in the City designated by the City Manager. However, if the requested books and records are too voluminous, or for security reasons cannot be copied and moved, then the Franchisee may request that the inspection take place at some other location mutually agreed to by the City and the Franchisee, provided that (1) the Franchisee must make necessary arrangements for copying documents selected by the City after its review; and (2) the Franchisee must pay all travel and additional copying expenses incurred by the City (above those that would have been incurred had the documents been produced in the City) in inspecting those documents or having those documents inspected by its designee.

Sec. 6516 Reports.

A.    Obligation to submit. The City Manager may from time to time direct a Franchisee to prepare reports and to submit those reports by a date certain, in a format prescribed by the City Manager, in addition to those required by this chapter for the purpose of ensuring compliance with the provisions of this Ordinance and the Franchise.

B.    Quarterly reports. Unless an exemption is granted by the City Manager, within 45 days of the end of each calendar quarter, a Franchisee shall submit a report to the City containing the following information:

1.    the number of service calls (calls requiring a truck roll) received during the prior quarter and the percentage of service calls compared to the Subscriber base; and

2.    the total estimated hours of known outages as a percentage of total hours of operation. An outage is a loss of sound or video on any signal, or a significant deterioration of any signal affecting two or more Subscriber.

C.    Annual reports. Unless an exemption is granted by the City Manager, no later than one hundred and twenty (120) days after the end of its fiscal year, a Franchisee shall submit the following information:

1.    A revenue report from the previous calendar year for the Cable Communications System, certified by an officer of the Franchisee and a similarly certified statement setting forth the computation of Gross Revenues used to calculate the Franchise fee for the preceding year and a detailed explanation of the method of computation showing (i) Gross Revenues by category (e.g., basic, pay, pay-per-view, advertising, installation, equipment, late charges, miscellaneous, other); and (ii) what, if any, deductions were made from Gross Revenues in calculating the Franchise fee (e.g., bad debt, credits and refunds), and the amount of each deduction.

2.    A report showing, for each applicable customer service standard, the Franchisee’s performance with respect to that standard for each quarter of the preceding year. In each case where Franchisee concludes it did not comply fully, the Franchisee will describe the corrective actions it is taking to assure future compliance. In addition, the report should identify the number and nature of all the customer service complaints received and an explanation of their dispositions.

3.    An ownership report, indicating all Persons who at the time of filing control or own an interest in the Franchisee of ten percent (10%) or more.

D.    Contemporaneous reports. Within 10 days of their receipt or (in the case of documents created by the Operator or its Affiliate) filing, a Franchisee shall provide the City:

1.    notices of deficiency or forfeiture related to the operation of the system; and

2.    any request for protection under bankruptcy laws, or any judgment related to a declaration of bankruptcy by the Franchisee or by any partnership or corporation that owns or controls the Franchisee directly or indirectly.

Sec. 6517 Maps Required.

Each Franchisee shall maintain accurate maps and improvement plans which show the location, size, and a general description of all facilities installed in the Public Rights-of-Way and any power supply sources (including voltages and connections). Maps shall be based upon post-construction inspection to verify location. Each Franchisee shall provide a map to the City showing the location of its facilities, in such detail and scale as may be directed by the City Public Works Director and update the map at least annually, and whenever the facility expands or is relocated. Copies of maps shall be provided in hard copy and on disk, in a commercially available electronic format specified by the City Public Works Director. Any disk provided to the City shall be returned to the Franchisee after information contained therein is entered into the City’s electronic mapping or other similar such system.

Sec. 6518 Other Records Required.

Unless the City Manager waives the requirement, a Franchisee shall at all times maintain:

A.    Complaint records. Records of all complaints received, their nature and resolution. The term "complaints" refers to complaints about any aspect of the Franchisee’s operations or customer service.

B.    Outage records. Records of outages known to the Franchisee, their cause and duration.

C.    Complaint response. Records of service calls for repair and maintenance indicating the date and time service was requested, the date of acknowledgment and date and time service was scheduled (if it was scheduled), and the date and time service was provided, and (if different) the date and time the problem was solved.

D.    Installation records. Records of installation/reconnection and requests for service extension, indicating date of request, date of acknowledgment, and the date and time service was extended.

E.    Customer service. Records sufficient to show whether the Franchisee has complied with each customer service standard that applies to it.

Sec. 6519 Exemptions.

The City Manager may temporarily exempt any Franchisee from its obligations under Sections 6515 - 6518 if the Manager determines that the requirement would be unduly burdensome or unnecessary, and that the City and Subscriber interests may be adequately protected in some other manner.

Sec. 6520 Privacy.

A Franchisee shall take all reasonable steps required so that it is able to provide reports, books and records to the City, including by providing appropriate Subscriber privacy notices. Each Franchisee shall be responsible for redacting data that applicable law prevents it from providing to the City. Nothing in this section shall be read to require a Franchisee to violate state or federal Subscriber privacy laws.

Sec. 6521 Procedures for paying Franchise fees and fees in lieu of Franchise fees.

A.    Fees paid quarterly. The Franchise fee paid pursuant to Article 2, or fee in lieu of Franchise fee paid pursuant to Article 3 shall be paid quarterly unless otherwise specified in a Franchise. Payment for each quarter shall be made to the City not later than forty-five (45) days after the end of each calendar quarter.

B.    Quarterly statement. Unless a Franchise provides otherwise, a Franchisee or other entity subject to a fee under Article 2 or 3 shall file with the City within forty-five (45) days of the end of each calendar quarter a statement showing Gross Revenues during the preceding quarter and the number of Subscribers served.

C.    Acceptance of payment not a release. No acceptance by the City of Arcata any payment shall be construed as an accord that the amount paid is in fact the correct amount, nor shall such acceptance of such payment be construed as a release of any claim the City may have for additional sums payable.

D.    Fee not in lieu of taxes. Neither the Franchise fee under Article 2, nor the fee paid in lieu of the Franchise fee under Article 3, is a payment in lieu of any tax, fee or other assessment of general applicability (including any such tax, fee or assessment imposed on both utilities and cable Operators or their services, but not including a tax, fee, or assessment which is unduly discriminatory against cable Operators or cable Subscriber(s).

E.    Failure to Pay Franchise fee. In the event that a fee payment is not received by the City on or before the due date set forth in this Section 6521 or in a Franchise, or the fee owed is not fully paid, the Person subject to the fee will be charged interest from the due date at an interest rate equal to three percent (3%) above the rate for three-month Federal Treasury Bills at the most recent United States Treasury Department sale of such Treasury Bills occurring prior to the due date of the Franchise fee payment.

F.    Final statement of gross revenues. Within ninety (90) days of the date a Franchisee ceases operations under a Franchise (whether because of Franchise termination, Transfer, bankruptcy or for any other reason), the Franchisee shall file a final statement of Gross Revenues covering the period from the beginning of the calendar year in which the operations ceased to the date operations ceased. The statement shall contain the information and be certified as required by Section 6516 (C)(1).

ARTICLE 2—SPECIAL RULES APPLICABLE TO CABLE SYSTEMS

Sec. 6530 Applications—Generally.

A.    Application required. An application must be filed for an initial and renewal Cable system Franchise, or for approval of a Transfer. A request for renewal filed under 47 U.S.C. § 546(h) need not contain the information required by Section 6550(B)(1).

B.    Application contents.

1.    The City Manager may specify the information that must be provided in connection with an application, and the form in which the information is to be provided. At a minimum each application must identify the applicant, show that the applicant is financially, technically and legally qualified to construct, maintain and operate the Cable system, contain a pro forma showing capital expenditures and expected income and expenses for the first five years the applicant is to hold the Franchise, and show that the applicant is willing to comply unconditionally with its Franchise obligations. In addition, any application for an initial or renewal Franchise or rebuild of the Operators system and/or facilities, must describe in detail the Cable system that the applicant proposes to build, show where it will be located, set out the system construction schedule, and show that the applicant will provide adequate Channels, facilities and other support for public, educational and government use (including institutional network use) of the Cable system. The detailed description of the physical facilities proposed, which shall include at least the following:

a.    A description of the channel capacity, technical design, performance characteristics, headend, Access (and institutional network) facilities and equipment;

b.    The location of proposed facility and facility design, including a description of the miles of plant to be installed, and a description of the size of equipment cabinets, shielding and electronics that will be installed along the plant route, the power sources that will be used and a description of the noise, exhaust and pollutants, if any, that will be generated by the operation of the same; provided, however, that, if some of the descriptive data is not available at the time of application, the Franchise may issue subject to conditions that the data be filed and approved by the City before construction begins and that the Franchise will be deemed to be forfeited if the data is not supplied and approved; provided, further, that the foregoing proviso does not authorize the grant of a Franchise where there is not sufficient information to appraise the impact of the applicant’s proposal;

c.    A map of the general route the facility will follow; a designation of the portions of the system that will be placed above ground and the portions that will be placed underground, and the construction techniques that the Operator proposes to use in installing the system above ground and underground; a schedule for construction of the facility, describing when and where construction will begin, how it will proceed, benchmarks indicating the schedule completion of portions of the system and when construction will be completed; and the expected effect on right-of-way usage, including information on the ability of the Public Rights-of-Way to accommodate the proposed system, including, as appropriate given the system proposed, an estimate of the availability of space in conduits and an estimate of the cost of any necessary rearrangement of existing facilities;

d.    A description, where appropriate, of how services will be converted from existing facilities to new facilities, and what will be done with existing facilities.

e.    A demonstration of how the applicant will reasonably meet the future cable-related needs and interests of the community, including descriptions of the capacity, facilities and support for public, educational, and governmental use of the system (including institutional networks) applicant proposes to provide and why applicant believes that the proposal is adequate to meet the future cable-related needs and interests of the community. A demonstration of the financial qualifications of the applicant, including at least the following:

(i)    The proposed rate structure, including projected charges for each service tier, installation, converters, and all other proposed equipment or services; and

(ii)    A statement regarding the applicant’s financial ability to complete the construction to meet the time frame proposed and to operate the Cable system proposed certified by the applicant’s chief financial officer;

f.    A demonstration of the applicant’s technical ability to construct and/or operate the proposed Cable system;

g.    A demonstration that the applicant is legally qualified, which proof must include a demonstration that the applicant:

(i)    Has received, or is in a position to receive, necessary authorizations from State and Federal authorities;

(ii)    Has not engaged in conduct (fraud, racketeering, violation of antitrust laws, consumer protection laws, or similar laws) that allows the City to conclude the applicant cannot be relied upon to comply with requirements of Franchise, or provisions of this chapter;

(iii)    Is willing to enter into a Franchise, to pay required compensation and to abide by the provisions of applicable law, including those relating to the construction, operation or repair of its facilities; and has not entered into any agreement that would prevent it from doing so; and

(iv)    The applicant must not have submitted an application for an initial or renewal Franchise to the City, which was denied on the ground that the applicant failed to propose a Cable system meeting the cable related needs and interests of the community, or as to which any challenges to such franchising decision were finally resolved (including any appeals) adversely to the applicant, within three years preceding the submission of the application.

h.    An applicant may show that it would be inappropriate to deny it a Franchise by virtue of: (1) the particular circumstances surrounding the acts or omissions at issue; (2) the steps taken by the applicant to cure all harms flowing therefrom and to prevent their recurrence; and the lack of involvement of the applicant’s principals, or (3) the remoteness of the acts or omissions from the operation of communications systems.

i.    The extent that the applicant is in any respect relying on the financial or technical resources of another Person, including another Affiliate, proofs should be provided for that Person.

j.    A description of the applicant’s prior experience in Cable system ownership, construction, and operation, and identification of cities and counties in California in which the applicant or any of its principals have a cable Franchise or any interest therein, provided that an applicant that holds a Franchise for the City and is seeking renewal of that Franchise need only provide this information for other cities and counties in California where its Franchise is scheduled to expire during the 12-month period prior to the date its application is submitted to the City and for other cities and counties in California where its Franchise had been scheduled to expire during the 12 month period after the date its application is submitted to the City. If an applicant has no other Franchise in California, it shall provide the information for its operations in other states.

k.    An affidavit or declaration of the applicant or authorized officer thereof certifying the truth and accuracy of the information in the application, and certifying that the application meets all requirements of applicable law.

3.    To be accepted for filing, an original and six copies of a complete application must be submitted. All applications shall include the names and addresses of persons authorized to act on behalf of the applicant with respect to the application.

4.    An applicant (and the Transferor and transferee, in the case of a Transfer) shall respond to any request for information from the City, by the time specified by the City.

C.    Incomplete applications. An application may be rejected if it is incomplete, or if the response to requests for information is not timely and complete.

Sec. 6531 Application for an Initial Franchise or Renewal Franchise.

A.    Scope. This section establishes additional provisions that apply to an application for an initial Franchise, or a renewal Franchise application that is not governed by 47 U.S.C. §546(a)-(h).

B.    Process. Any Person may apply for an initial or renewal Franchise by submitting an application therefore on that Person’s own initiative, or in response to a request for proposals issued by the City. If the City receives an unsolicited application, it may choose to issue a request for additional proposals, and require the applicant to amend its proposal to respond thereto. The City shall promptly conduct such investigations as are necessary to act on an application.

C.    Consideration of application. In determining whether to grant a Franchise, the City may consider:

1.    the extent to which an applicant for renewal has substantially complied with the applicable law and the material terms of any existing cable Franchise;

2.    whether an applicant’s quality of service under its existing Franchise, including signal quality, response to customer complaints, billing practices, and the like has been reasonable in light of the needs of the community;

3.    where the applicant has not previously held a Cable system Franchise in the City, whether the applicant’s record in other communities indicates that it can be relied upon to provide high-quality service throughout any Franchise term;

4.    whether the applicant has the financial, legal, and technical ability to provide the services, facilities, and equipment set forth in an application, and to satisfy any minimum requirements established by the City;

5.    whether the applicant’s application is reasonable to meet the future cable-related needs and interests of the City, taking into account the cost of meeting such needs and interests;

6.    whether issuance of a Franchise is in the public interest considering the immediate and future effect on streets, Public Property, and private property that will be used by the applicant’s Cable system;

7.    whether issuance of the Franchise would reduce competition in the provision of cable service in the City;

8.    such other matters as the City is authorized or required to consider.

D.    Issuance of Franchise. If the City determines that issuance of a Franchise would be in the public interest considering the factors described above, it may offer a Franchise agreement to the applicant. No Franchise shall become effective until the Franchise is unconditionally accepted by the applicant, approved by the (insert name of City) City Council, and the Franchise agreement is signed by both parties.

Sec. 6532 Application for Renewal Franchise Filed Pursuant to 47 U.S.C. § 546.

A.    Scope. This section establishes additional provisions that apply to applications for renewal governed by 47 U.S.C. §546(a)-(g).

B.    Process. A Franchisee which intends to exercise rights under 47 U.S.C. § 546(a)-(g) shall submit a notice in writing to the City in a timely manner clearly stating that it is activating the procedures set forth in those sections. The City shall thereafter commence any proceedings that may be required under federal law, and upon completion of those proceedings, the City may issue a request for proposals and an application may be submitted for renewal. The City may preliminarily deny the application by resolution, and if the application is preliminarily denied, the City may conduct such proceedings and by resolution establish such procedures and appoint such individuals as may be necessary to conduct any proceedings to review the application.

Sec. 6533 Application for Transfer.

A.    Scope. This section establishes additional provisions that apply to applications for Transfer approval.

B.    Information. An application for Transfer must contain all the information required by the City Manager, by Section 6550, and all information required by any FCC Transfer form.

C.    Consideration of application. In determining whether a Transfer application should be granted, denied, or granted subject to conditions, the City may consider the legal, financial, and technical qualifications of the transferee to operate the Cable system; any potential impact of the transfer on Subscriber rates or services; whether the incumbent cable Operator is in compliance with its Franchise; whether the transferee owns or controls any other Cable system in the City, whether operation by the transferee may eliminate or reduce competition in the delivery of cable service in the City; and whether operation by the transferee or approval of the Transfer would otherwise adversely affect Subscribers, the public, or the City’s interest under this chapter, the Franchise, or other applicable law. The proposed transferee shall pay all reasonable costs incurred by the City in reviewing and evaluating the applications.

D.    Minimum conditions. In order to obtain approval of a Transfer, an applicant must show, at a minimum, that: the transferee is qualified; the transfer will not adversely affect the interests of Subscribers, the public, or the City; and that non-compliance issues have been resolved. No application shall be granted unless the transferee agrees in writing that it will abide by and accept all terms of this chapter and the Franchise, and that it will assume the obligations, liabilities, and responsibility for all acts and omissions, known and unknown, of the previous Franchisee for all purposes.

Sec. 6534 Legal Qualifications.

A.    Standards.

1.    The applicant must be willing to comply with the provisions of this chapter and applicable laws; and to comply with such requirements of a Franchise as the City may lawfully require.

2.    The applicant must not have had any Cable system or OVS Franchise validly revoked, (including any appeals) by the City within three (3) years preceding the submission of the application.

3.    The applicant must not have had an application to the City for an initial or renewal Cable system Franchise denied on the ground that the applicant failed to propose a Cable system meeting the cable-related needs and interests of the community, or as to which any challenges to such franchising decision were finally resolved (including any appeals) adversely to the applicant, within three (3) years preceding the submission of the application; and must not have had an application for an initial or renewal OVS Franchise denied on any ground within three years of the application.

4.    The applicant shall not be issued a Franchise if, at any time during the ten (10) years preceding the submission of the application, applicant was convicted of fraud, racketeering, anticompetitive actions, unfair trade practices or other conduct of such character that the applicant cannot be relied upon to deal truthfully with the City and the Subscribers, or to substantially comply with its obligations.

5.    Applicant must have the necessary authority under California and federal law to operate a Cable system, or show that it is in a position to obtain that authority.

6.    The Applicant shall not be issued a Franchise if it files materially misleading information in its application or intentionally withholds information that the applicant lawfully is required to provide.

7.    For purposes Section 6554(A)(2) - (4) the term applicant includes any Affiliate of applicant.

B.    Exception. Notwithstanding Section 6554(A), an applicant shall be provided a reasonable opportunity to show that a Franchise should issue even if the requirements of Section 6554(A)(3) - (4) are not satisfied, by virtue of the circumstances surrounding the matter and the steps taken by the applicant to cure all harms flowing therefrom and prevent their recurrence, the lack of involvement of the applicant’s principals, or the remoteness of the matter from the operation of a Cable system.

Sec. 6535 Franchise fee.

A cable Operator shall pay to the City a Franchise fee in an amount equal to 5 percent of Gross Revenues, or such other amount as may be specified in the Franchise; provided, however, that if the Franchise specifies an amount, that amount shall be subject to increase should federal limits on fee payments be eliminated or changed and other cable Operators are subject to a higher fee.

A.    "Bundled services." In the event that the Franchisee shall, during the term of the Franchise, offer bundled, tied, or combined Cable Services (which are subject to the franchise fee) with non-Cable Services (which may not be subject to the franchise fee) to individual subscribers, the combined revenues from such bundled services shall be allocated consistent with the rates or prices advertised by the Franchisee through its marketing materials or on its published rate card. In the event the Franchisee does not advertise or publish separate prices for the combined services, the percentage that the price for the combined services is discounted from the regular retail rates of the individual services shall be pro-rated across all the services in the bundled package; provided, however, that the net revenues derived from services subject to mandatory tariff rates imposed by the California Public Utilities Commission (or other governmental entity having such authority) shall be deducted from the combined revenue to determine the revenue subject to the franchise fee. As an example, Franchisee may offer a "bundle" of video, voice and data services for a flat fee of $75.00 where the retail rate for the services purchased on an individual basis would equal $100.00. Assuming that there is no service subject to the mandated tariff rate, Grantee would apply a twenty-five percent (25%) discount to each service. Thus, if the retail rate for the Cable Service in the bundle were $50.00, Grantee would recognize Cable Service revenue in the amount of $37.50 and pay a franchise fee on that revenue.

B.    The definition of gross revenue is to be as inclusive as possible consistent with existing applicable law. If a change in federal law occurs subsequent to the effective date of this ordinance, such change shall not impact the Gross Revenues definition in such a way to reduce Gross Revenues - unless the change specifically preempts the affected portion of the definition above.

Sec. 6536 No exclusivity.

A Franchisee may not require a Subscriber or a building owner or manager to enter into an exclusive contract as a condition of providing or continuing service. However, nothing herein prevents a Franchisee from entering into an otherwise lawful, mutually desired exclusive arrangement with a building owner or manager of a multiple dwelling unit or commercial Subscriber.

Sec. 6537 Minimum Franchise conditions.

In addition to satisfying such additional or stricter conditions as the City finds necessary based on its investigations, the following elements shall be required in every Franchise serving more than 1000 Subscribers: An Operator who provides service in an area which is defined as "isolated rural" maybe exempted from the minimum Franchise requirements for that area.

A.    System design. Each Franchisee shall provide a Cable system which uses at least 750MHz equipment of high quality and reliability. Each Franchisee shall install and activate the return portion of the Cable system in the sub-low frequency spectrum of 5 MHz to 30 MHz.

B.    Public, educational and government use of the system.

1.    A Franchisee shall provide a minimum of 3 Channels for PEG access to each Subscriber.

2.    Each Franchisee shall install, maintain, and replace as necessary, a dedicated, bi-directional fiber optic link between its headend and a location designated by the City as the primary access center.

3.    Each Franchisee shall install, maintain, and replace activated two-way cable plant and all headend, cable plant, and node equipment required to make it operable so that the City, Schools, and all designated PEG access centers and Access facilities located within the Franchise area will be able to send and receive signals (video, audio, and data) using the activated two-way cable plant.

4.    Each Franchisee shall ensure that technically adequate signal quality, routing systems, and switching and/or processing equipment are initially and continuously provided for all access interconnections both within Franchisee’s Cable system and with other Cable systems throughout the duration of its Franchise.

5.    In the event a Franchisee makes any change in the Cable system and related equipment and facilities or in the Franchisee’s signal delivery technology which directly or indirectly substantially affects the signal quality or transmission of Access programming, the Franchisee shall at its expense take necessary steps or provide necessary technical assistance, including the acquisition of all necessary equipment, to ensure that the capabilities of access programmers are not diminished or adversely affected by such change.

6.    A Franchisee shall maintain all access Channels (both Upstream Channels and Downstream Channels) and all interconnections of Access Channels at the same level of technical quality and reliability as the best commercial channels carried on the grantee’s system.

C.    Service to Franchise area. It is the policy of the City to ensure that every Cable system provide service in its Franchise area upon request to any Person or any government building. Each Franchisee shall extend service upon request within its Franchise area, provided that, a Franchise may permit a Franchisee to require a potential Subscriber to contribute a fair share of the capital costs of installation or extension as a condition of extension or installation in cases where such extension or installation may be unduly expensive. Service must be provided within time limits specified in Section 6557(D).

D.    Time for extension. Except as a Franchise otherwise provides, service must be extended upon request to any Person or to any government building in a Franchisee’s Franchise area (1) within seven days of the request, where service can be provided by activating or installing a drop; (2) within 90 days of the request where an extension of one half mile or less is required; or (3) within six months where an extension of one half mile or more is required. Notwithstanding the foregoing, Franchisee shall not be deemed to be in violation of this section in the event the Franchisee uses reasonable efforts to complete the extension in a timely manner but weather or other circumstances beyond the reasonable control of the Franchisee prevent such timely completion.

E.    Technical standards. A Cable system within the City shall meet or exceed the technical standards set forth in 47 C.F.R. § 76.601 and any other applicable technical standards.

F.    Testing. Each cable Operator shall perform at its expense such tests as may be necessary to show whether or not the Franchisee is in compliance with its obligations under applicable FCC standards, this chapter or a Franchise.

G.    Interconnection. Upon request of the City, every Cable system shall be required to interconnect with every other Cable system within the City, or adjacent to the City, on fair and reasonable terms for purposes of providing PEG and I-Net services.

H.    Continuity of service. Each Franchisee shall, during the term of the Franchise, ensure that Subscribers are able to receive continuous service. In the event the Franchise is revoked or terminated, the Franchisee may be required to continue to provide service for a reasonable period to assure an orderly transition of service from the Franchisee to another entity. A Franchise may establish more particular requirements under which these obligations will be satisfied.

Sec. 6539 Rate regulation and consumer protection.

A.    All rates subject to regulation. The City may regulate any of the cable Operator’s rates and charges, except to the extent it is prohibited from doing so by law. The City will regulate rates in accordance with FCC rules and regulations, where applicable. Except to the extent FCC rules provide otherwise, all rates and charges that are subject to regulation, and changes in those rates or charges must be approved in advance. The City Manager may take any required steps to file complaints, toll rates, issue accounting orders or take any other steps required to comply with FCC regulations. The City Council shall be responsible for issuing rate orders that establish rates or order refunds.

B.    No rate discrimination. Except to the extent the City may not enforce such a requirement, a cable Operator is prohibited from discriminating in its rates or charges or from granting undue preferences to any Subscriber, potential Subscriber, or group of Subscribers or potential Subscribers; provided, however, that a Franchisee may offer temporary, bona fide promotional discounts in order to attract or maintain Subscribers, so long as such discounts are offered on a non-discriminatory basis to similar classes of Subscribers throughout the Franchise area; and a Franchisee may offer discounts for the elderly, the disabled, or the economically disadvantaged; and such other discounts as it is expressly entitled to provide under federal law, if such discounts are applied in a uniform and consistent manner.

C.    Redlining prohibited. A cable Operator shall not deny access or charge different rates to any group of Subscribers or potential Subscribers because of the income of the residents of the local area in which such group resides.

D.    Customer service.

1.    Each cable Operator must satisfy FCC, state and the City cable customer service standards or consumer protection standards. The City cable customer service standards may be adopted by resolution. In the case of a conflict among standards, the stricter standard shall apply.

2.    For violation of cable customer service standards, penalties will be imposed as follows:

a.    Two hundred dollars ($200) for each day of each material breach, not to exceed six hundred dollars ($600) for each occurrence of material breach.

b.    If there is a subsequent material breach of the same provision within twelve (12) months, four hundred ($400) for each day of each material breach, not to exceed twelve hundred ($1200) for each occurrence of the material breach.

c.    If there is a third or additional material breach of the same provision within twelve (12) months of the first, one thousand dollars ($1000) for each day of each material breach, not to exceed three thousand dollars ($3,000) for each occurrence of the material breach.

3.    Any penalty assessed under this section will be reduced dollar for dollar to the extent any liquidated damage provision of a Franchise imposes a monetary obligation on a Franchisee for the same customer service failures, and no other monetary damages may be assessed. The City will provide notice, and impose penalties, under this section pursuant to the procedures established by California Government Code § 53088.2(r).

ARTICLE 3—OPEN VIDEO SYSTEMS

Sec. 6540 Additional definitions

A.    "OVS Agreement" means a contract entered into in accordance with the provisions of this chapter between the City and an OVS Franchisee setting forth the terms and conditions under which the Franchise will be exercised.

Sec. 6541 Applications for Grant or Renewal of Franchises.

A.    Initial and renewal Franchise: application.

1.    A written application shall be filed with the City for grant of an initial or renewal Franchise.

2.    To be acceptable for filing, a signed original of the application shall be submitted together with six (6) copies. The application must conform to any applicable request for proposals, and contain all information required under Section 6001(B). All applications shall include the names and addresses of persons authorized to act on behalf of the applicant with respect to the application.

B.    Contents of applications. The City Manager may specify the information that must be provided in connection with a request for proposals or an application for an initial or renewal Franchise. At a minimum, each application must: identify the applicant, where it plans to construct its system, and the system construction schedule; show that the Applicant will provide adequate Channels, facilities and other support for public, educational and government use (including institutional network use) of the OVS; and show that the applicant is financially, technically and legally qualified to construct and operate the OVS. The application must contain the following information;

1.    Identity of the applicant; the Persons who exercise working control over the applicant; and the Persons who control those Persons, to the ultimate parent.

2.    A proposal for construction of the open video system that includes at least the following:

a.    A description of the services that are to be provided over the facility.

b.    Identification of the area of the City to be served by the proposed system, including a description of the proposed Franchise area’s boundaries.

c.    The location of proposed facility and facility design, including a description of the miles of plant to be installed, and a description of the size of equipment cabinets, shielding and electronics that will be installed along the plant route, the power sources that will be used and a description of the noise, exhaust and pollutants, if any, that will be generated by the operation of the same.

d.    A map of the route the facility will follow; a designation of the portions of the system that will be placed aboveground and the portions that will be placed underground, and the construction techniques that the Operator proposes to use in installing the system aboveground and underground; a schedule for construction of the facility, describing when and where construction will begin, how it will proceed, benchmarks for competition of phases, and when it will be completed; and the expected effect on right-of-way usage, including information on the ability of the Public Rights-of-Way to accommodate the proposed system, including, as appropriate given the system proposed, an estimate of the availability of space in conduits and an estimate of the cost of any necessary rearrangement of existing facilities.

e.    A description, where appropriate, of how services will be converted from existing facilities to new facilities, and what will be done with existing facilities.

3.    Evidence satisfactory to the City that the applicant has the financial resources to complete the proposed project, and to construct, operate and repair the proposed facility over the Franchise term. It is not the intent of the City to require an applicant to prove that the services it proposed to offer will succeed in the marketplace.

4.    Evidence satisfactory to the City that applicant is technically qualified to construct, operate and repair the proposed facility. At a minimum, the applicant must show that it has experience or resources to ensure that work is to be performed adequately, and can respond to emergencies during and after construction is complete.

5.    Evidence satisfactory to the City that the applicant is legally qualified, which proof must include a demonstration that the applicant:

6.    Has received, or is in a position to receive, necessary authorizations from state and federal authorities;

7.    Has not engaged in conduct (fraud, racketeering, violation of antitrust laws, consumer protection laws, or similar laws) that allows City to conclude the applicant cannot be relied upon to comply with requirements of Franchise, or provisions of this title;

8.    Is willing to enter into a Franchise, to pay required compensation and to abide by the provisions of applicable law, including those relating to the construction, operation or maintenance of its facilities, and has not entered into any agreement that would prevent it from doing so;

9.    An affidavit or declaration of the applicant or authorized officer thereof certifying the truth and accuracy of the information in the application, and certifying that the application meets all requirements of applicable law.

10.    An applicant may show that it would be inappropriate to deny it a Franchise by virtue of: the particular circumstances surrounding the acts or omissions at issue; the steps taken by the applicant to cure all harms flowing therefrom and to prevent their recurrence; and the lack of involvement of the applicant’s principals, or the remoteness of the acts or omissions from the operation of open video system facilities.

11.    To the extent that the applicant is in any respect relying on the financial or technical resources of another Person, including another Affiliate, the proofs should be provided for that Person. An applicant will be presumed to have the requisite financial, or technical or legal qualifications to the extent such qualifications have been reviewed and approved by a state agency of competent jurisdiction; or if applicant is a holder of a Franchise in the City for a Cable system or open video system, and conduct under such other Franchise provides no basis for additional investigation.

C.    Procedure for applying for grant of a Franchise.

1.    A Person may apply for an initial or renewal Franchise on its own initiative or in response to a request for proposals. Upon receipt of an application the City shall promptly proffer the applicant a proposed OVS Agreement, which shall be mailed to the Person requesting its issuance and made available to any other interested party. The City may request such additional information as it deems appropriate.

2.    An applicant shall respond to requests for information completely, and within the time directed by the City, and must strictly comply with procedures, instructions, and requirements the City may establish.

3.    An application may be rejected if it is incomplete or the applicant fails to follow procedures or respond fully to information requests.

D.    Evaluation. In evaluating a Franchise application, the City may consider the following:

1.    The extent to which the applicant has substantially complied with the applicable law and the material terms of any existing the City OVS Franchise;

2.    Whether the applicant has the financial, technical, and legal qualifications to hold an OVS Franchise;

3.    Whether the application satisfies any minimum requirements established by the City for, or will otherwise provide adequate public, educational, and governmental use capacity, facilities, or financial support (including with respect to institutional networks);

4.    Whether issuance of a Franchise would require replacement of property or involve disruption of property, public services, or use of the Public Rights-of-Way;

5.    Whether the approval of the application may eliminate or reduce competition in the delivery of Cable service in the City.

E.    Issuance. If the City finds that it is in the public interest to issue a Franchise considering the factors above, and such other matters as it is required or entitled to consider, and subject to the applicant’s entry into an appropriate OVS agreement, it shall issue a Franchise. Prior to deciding whether or not to issue a Franchise, the City may hold one or more public hearings or implement other procedures under which comments from the public on an application may be received.

F.    Legal qualifications. In order to be legally qualified:

1.    The applicant must be willing to comply with the provisions of this Title and applicable laws, and to comply with such requirements of an OVS agreement as the City may lawfully require.

2.    The applicant must not hold a Cable system Franchise, or have pending an application for a Cable system Franchise.

3.    The applicant must not have had any Cable system or OVS Franchise validly revoked, (including any appeals) by the City within three (3) years preceding the submission of the application.

4.    The applicant may not have had an application for an initial or renewal Cable system Franchise to the City denied on the ground that the applicant failed to propose a Cable system meeting the cable-related needs and interests of the community, or as to which any challenges to such franchising decision were finally resolved (including any appeals) adversely to the applicant, within three (3) years preceding the submission of the application, and;

5.    The applicant may not have had an application for an initial or renewal OVS Franchise denied on any grounds within three (3) years of the applications.

6.    The applicant shall not be issued a Franchise if, at any time during the ten (10) years preceding the submission of the application, applicant was convicted of fraud, racketeering, anticompetitive actions, unfair trade practices or other conduct of such character that the applicant cannot be relied upon to deal truthfully with the City and the Subscribers or to substantially comply with its obligations.

7.    Applicant must have the necessary authority under California and federal law to operate an OVS, and must be certified by the FCC under Section 653 of the Cable Act.

8.    The Applicant shall not be issued a Franchise if it files materially misleading information in its application or intentionally withholds information that the applicant lawfully is required to provide.

9.    For purposes of Section 6601(F)(2) - (5) the term applicant includes any Affiliate of applicant.

G.    Exception. Notwithstanding Section 6601(F)(2) - (5), an applicant shall be provided a reasonable opportunity to show that, a Franchise should issue even if the requirements of Section 6601(F)(4) - (5) are not satisfied, by virtue of the circumstances surrounding the matter and the steps taken by the applicant to cure all harms flowing therefrom and prevent their recurrence, the lack of involvement of the applicant’s principals, or the remoteness of the matter from the operation of a Cable system.

Sec. 6542 Transfers.

A.    City of Arcata approval required. No Transfer shall occur without prior written notice to and approval of the City.

B.    Application.

1.    A Franchisee shall promptly notify the City of any proposed Transfer, and submit an application for its approval.

2.    The City Manager may specify information that must be provided in connection with a Transfer application. At a minimum, an application must: describe the entities involved in the transaction and the entity that will hold the Franchise; describe the chain of ownership before and after the proposed transaction; show that the entity that will hold the Franchise will be legally, financially, and technically qualified to do so; attach complete information on the proposed transaction, including the contracts or other documents that relate to the proposed transaction, and all documents, schedules, exhibits, or the like referred to therein; and attach any shareholder reports or filings with the Securities and Exchange Commission ("SEC") that discuss the transaction.

3.    For the purposes of determining whether it shall consent to a Transfer, the City or its agents may inquire into all qualifications of the prospective transferee and such other matters as the City may deem necessary to determine whether the Transfer is in the public interest and should be approved, denied, or conditioned. If the transferee or Franchisee refuses to provide information, or provides incomplete information, the request for Transfer may be denied.

C.    Determination by the City.

1.    In deciding whether a Transfer application should be granted, denied or granted subject to conditions, the City may consider the legal, financial, and technical qualifications of the transferee to operate the OVS; whether the incumbent OVS Operator is in compliance with its OVS agreement and this Title and, if not, the proposed transferee’s commitment to cure such noncompliance; whether the transferee owns or controls any other OVS or Cable system in the City, and whether operation by the transferee may eliminate or reduce competition in the delivery of cable service in the City; and whether operation by the transferee or approval of the transfer would adversely affect Subscribers, the public, or the City’s interest under this Title, the OVS agreement, or other applicable law.

2.    In order to obtain approval of a Transfer, an applicant must show, at a minimum, that: the transferee is qualified; the Transfer will not adversely affect the interests of Subscribers, the public, or the City; and that non-compliance issues have been resolved. No application shall be granted unless the transferee agrees in writing that it will abide by and accept all terms of this title and the Franchise, and that it will assume the obligations, liabilities, and responsibility for all acts and omissions, known and unknown, of the previous Franchisee for all purposes. The proposed transferee shall pay all reasonable costs incurred by the City in reviewing and evaluating the applications.

Sec. 6543 Minimum requirements.

A.    PEG access. No OVS Operator shall be issued a Franchise, or may commence construction of an OVS system, until (1) it agrees to match in all respects the highest PEG obligations borne by any cable Operator in the City; or (2) it agrees to PEG obligations acceptable to the City.

B.    Institutional network. Any OVS Operator that constructs an I-Net must match in all respects the highest I-Net obligations borne by any cable Operator in the City, unless it agrees to alternative I-Net obligations acceptable to the City.

C.    Construction provisions. Every OVS agreement shall specify the construction schedule that will apply to any required construction, upgrade, or rebuild of the OVS. The schedule shall provide for prompt completion of the project, considering the amount and type of construction required.

D.    Testing. Each OVS Operator shall perform at its expense such tests as may be necessary to show whether or not the Franchisee is in compliance with its obligations under this Title or a Franchise.

E.    Consumer protection provisions. Every Franchisee must satisfy customer service consumer protection requirements established from time to time under state or local law and applicable to OVS.

Sec. 6544 Special termination rules.

If a Franchisee’s FCC certification is revoked or otherwise terminates as a result of the passage of time or as a matter of law, the City may revoke the OVS Franchise after a hearing. The OVS Franchise may also be revoked if federal regulations or statutory provisions governing OVS are declared invalid or unenforceable, or are repealed.

Sec. 6545 Rate regulation.

The City may regulate a Franchisee’s rates and charges except as prohibited by law, and may do so by amendment to this Title, separate ordinance, by amendment to an OVS Agreement, or in any other lawful manner.

Sec. 6546 Fee in lieu of Franchise fee.

A.    OVS operators. In lieu of the Franchise fee required by Article 2, an OVS Franchisee shall pay a fee of five percent (5%) of the Gross Revenues of the Franchisee, its Affiliates or any OVS Operator of the OVS.

B.    Persons leasing OVS capacity.

1.    A Person leasing capacity from an OVS Operator, other than a Person whose revenues are included in the payment made under Section 6606(A) shall pay the City a fee in lieu of the Franchise fee required by Article 2 of five percent (5%) of the Gross Revenues of such Person.

2.    Notwithstanding the foregoing, where Franchisee charges a Person, other than an Affiliate, to use its OVS (the "use payments"); and that Person recovers those use payments through charges to its Subscribers that are included in that Person’s Gross Revenues; and that Person fully recovers the use payments through the charges to its Subscribers and pays a fee on those charges pursuant to Section 6606(A) then Franchisee may deduct from its Gross Revenues the use payments it receives from that Person.

Sec. 6547 Exclusive contracts.

A Franchisee may not require a Subscriber or a building owner or manager to enter into an exclusive contract as a condition of providing or continuing service, nor may a Franchisee enter into any arrangement that would effectively prevent other Persons from using the OVS to compete in the delivery of cable services with a Franchisee or its Affiliates.

ARTICLE 4—MISCELLANEOUS

Sec. 6550 Captions.

The captions to sections throughout this Title are intended solely to facilitate reading and reference to the sections and provisions of this Title. Such captions shall not affect the meaning or interpretation of this Title.

Sec. 6551 Calculation of time.

Unless otherwise indicated, when the performance or doing of any act, duty, matter, or payment is required under this Title or any Franchise, and a period of time or duration for the fulfillment of doing thereof is prescribed and is fixed herein, the time shall be computed so as to exclude the first and include the last day of the prescribed or fixed period of time.

Sec. 6552 Severability.

If any term, condition, or provision of this Title shall, to any extent, be held to be invalid or unenforceable by a valid order of any court or regulatory agency, the remainder hereof shall be valid in all other respects and continue to be effective. In the event of a subsequent change in applicable law so that the provision which had been held invalid is no longer invalid, said provision shall thereupon return to full force and effect without further action by the City and shall thereafter be binding on the Franchisee and the City.

Sec. 6553 Connections to Cable system; use of antennae.

A.    Subscriber right to attach. To the extent consistent with federal law, Subscribers shall have the right to attach VCR’s, receivers, and other terminal equipment to a Franchisee’s Cable system. Subscribers also shall have the right to use their own remote control devices and converters, and other similar equipment.

B.    Removal of existing antennae. A Franchisee shall not, as a condition of providing service, require a Subscriber or potential Subscriber to remove any existing antenna, or disconnect an antenna except at the express direction of the Subscriber or potential Subscriber, or prohibit installation of a new antenna; provided, that such antenna is connected with an appropriate device and complies with applicable law.

Sec. 6554 Discrimination prohibited.

A.    No retaliatory actions. A cable communication system operator shall not discriminate among persons or the City or take any retaliatory action against a person or the City because of that entity’s exercise of any right it may have under federal, state, or local law, nor may the operator require a person or the City to waive such rights as a condition of taking service.

B.    Employment and hiring practices. A cable communication system operator shall not refuse to employ, discharge from employment, or discriminate against any person in compensation or in terms, conditions, or privileges of employment because of race, color, creed, national origin, sex, sexual orientation, age, disability, religion, ethnic background, or marital status. A cable communication system operator shall comply with all federal, state, and local laws and regulations governing equal employment opportunities, and hiring practices, as the same may be amended from time to time.

Sec. 6555 Confidential Information.

A.    Access to a cable communication system operator’s records shall not be denied to the City on the basis that said records contain proprietary information. Refusal to provide information to the City required herein, or required in a franchise or license shall be grounds for franchise revocation. Subject to applicable law, including the California Public Records Act, California Government Code Section 6250 et seq., the City shall keep any information which is marked “proprietary” or “confidential” (and, under applicable law, deemed proprietary or confidential) submitted by franchisee or licensee as required under this article or by a franchise or license (“information”) in confidence, as contemplated by California Government Code Section 6254.15. In the event that the City believes requested information must be disclosed, the City shall not disclose the Information or any part thereof to any third party, government agency or regulatory body seeking to inspect or obtain the information under a California Public Records Act request without first informing cable communication system operator of such request and affording the cable communication system operator the opportunity to resist such disclosure at its sole cost and expense. The City shall not be liable to cable communication system operator for any submission or disclosure of such information to a third party as required by applicable law or to a government agency or regulatory body seeking the information and claiming jurisdiction in any of these events. Nothing in this Section 4405 shall limit the right of the cable communication system operator to contest disclosure or submission to a third party as required by law or to a government agency or regulatory body asserting jurisdiction over it or such subject matter before such disclosure shall be effected.

Sec. 6556 Transitional provisions.

A.    Persons operating without a franchise. The operator of any facility installed as of the effective date of the ordinance codified in this title, for which a franchise is required under this title, shall have three (3) months from the effective date of the ordinance codified in this title to file one or more applications for a franchise. Any operator timely filing such an application under this Section 4406(A) shall not be subject to a penalty for failure to have such a franchise so long as said application remains pending; provided, however, nothing herein shall relieve any cable communications system operator of any liability for its failure to obtain any permit or other authorization required under other provisions of the City Code, and nothing herein shall prevent the City from requiring removal of any facilities installed in violation of the City Code.

B.    Persons holding franchises. Any person holding an existing franchise for a cable communications system may continue to operate under the existing ordinance to the conclusion of its present term (but not any renewal or extension thereof) with respect to those activities expressly authorized by the franchise; and provided further, that such person shall be subject to the other provisions of this title to the extent permitted by law.

C.    Persons with pending applications. Pending applications shall be subject to this title. A person with a pending application shall have thirty (30) days from the effective date of the ordinance codified in this title to submit additional information to comply with the requirements of this title governing applications.

ARTICLE 5—STATE VIDEO SERVICE FRANCHISES

Sec. 6560 General Provisions.

A.    Purpose. This article is applicable to video service providers who have been awarded a state video franchise under the California Public Utilities Code Section 5800, et seq. (the Digital Infrastructure and Video Competition Act of 2006 (“DIVCA”)), to provide cable or video services in any location(s) within the incorporated boundaries of the City. It is the purpose of this article to implement within the incorporated boundaries of the City the provisions of DIVCA and the rules of the California Public Utilities Commission promulgated thereunder that are applicable to a local franchising entity or a local entity as defined in DIVCA.

B.     Rights reserved.

1.    The rights reserved to the City under this article are in addition to all other rights of the City, whether reserved by this title or authorized by law, and no action, proceeding or exercise of a right shall affect any other rights which may be held by the City.

2.    Except as otherwise provided by DIVCA, a state franchise shall not include, or be a substitute for:

a.    Compliance with applicable requirements for the privilege of transacting and carrying on a business within the City, including, but not limited to, compliance with the conditions that the City may establish before facilities may be constructed for, or providing, non-video services;

b.    Any permit or authorization required in connection with operations on or in public rights-of-way or public property, including, but not limited to, encroachment permits, street work permits, pole attachment permits and street cut permits; and

c.    Any permit, agreement or authorization for occupying any other property of the City or any private person to which access is not specifically granted by the state franchise.

3.    No permit issued by the City to a state franchise holder is itself a franchise, nor shall any permit create a vested right that would prohibit the City from revoking or amending the permit.

C.    Compliance with City ordinances. Nothing contained in this article shall be construed so as to exempt a state franchise holder from compliance with all ordinances, rules or regulations of the City now in effect or which may be hereafter adopted which are consistent with this article or California Public Utilities Code Section 5800, et seq., or any obligations under any franchise issued by the City insofar as those obligations may be enforced under California Public Utilities Code Section 5800, et seq.

D.    Compliance with DIVCA. When a video service provider holding a state franchise provides notice to the City pursuant to Section 5840(n) of the California Public Utilities Code that it is commencing to provide video service to the City, a holder of a local franchise is entitled to seek a state franchise pursuant to Section 5930(c) of the California Public Utilities Code and upon issuance of a state franchise by the California Public Utilities Commission for the franchise area the local franchise shall terminate. (Ord. 1405, eff. 2/4/2011)

Sec. 6561 Definitions.

A.    Definitions generally—Interpretation of language. For purposes of this article the following terms, phrases, words, and their derivations shall have the meaning given in this section. Words not defined in this section shall have the same meaning as established in: (1) DIVCA, and if not defined therein, (2) California Public Utilities Commission rules implementing DIVCA, and if not defined therein, (3) the Federal Communications Act of 1934, as amended, 47 USC 521 et seq., and if not defined therein, (4) their common and ordinary meaning. When not inconsistent with the context, words used in the present tense include the future, words in the plural number include the singular number, words in the singular number include the plural number, and “including” and “include” are not limiting. The words “shall” and “will” are always mandatory, but the use of those terms grants no private rights to any person with respect to the City. References to governmental entities (whether persons or entities) refer to those entities or their successors in authority. If specific provisions of law referred to herein are renumbered, then the reference shall be read to refer to the renumbered provision. References to laws, ordinances or regulations shall be interpreted broadly to cover government actions, however nominated, and include laws, ordinances and regulations now in force or hereinafter enacted or amended.

1.    “Gross revenues,” means all revenues actually received by the holder of a state franchise or its affiliates that are derived from the operation of the holder’s network to provide cable service or video service within the incorporated areas of the City.

2.    “PEG access” or “PEG” means the availability of a cable or state franchise holder’s system for public, educational, or governmental use by various agencies, institutions, organizations, groups, and individuals, including organizations, groups, or individual members of the general public, educational institutions, and the City and its designated access providers, to acquire, create, and distribute programming not under a state franchise holder’s editorial control.

3.    “State franchise holder” means a cable operator or video service provider that has been issued a franchise by the California Public Utilities Commission to provide cable service or video service, as those terms are defined in California Public Utilities Code Section 5830, within any portion of the incorporated limits of the City. (Ord. 1405, eff. 2/4/2011)

Sec. 6562 Franchise Fees.

A.    State franchise fees. Any state franchise holder operating within the incorporated areas of the City shall pay to the City a state franchise fee equal to five percent (5%) of gross revenues that may be subject to a franchise fee under California Public Utilities Code Section 5860.

B.    Payment of franchise fees. The state franchise fee required pursuant to this Section 6562 shall be paid quarterly, in a manner consistent with California Public Utilities Code Section 5860. The state franchise holder shall deliver to the City, by check or other means, which shall be agreed to by the City, a separate payment for the state franchise fee not later than forty-five (45) days after the end of each calendar quarter. Each payment made shall be accompanied by a report, detailing how the payment was calculated, and shall include such additional information on the appropriate form as designated by the City.

C.    Examination of business records. The City may examine the business records of the holder of a state franchise in a manner consistent with California Public Utilities Code Section 5860(i).

D.    Late payments. In the event a state franchise holder fails to make payments required by this Section 6562 on or before the due dates specified herein, the City shall impose a late charge at the rate per year equal to the highest prime lending rate during the period of delinquency, plus one percent (1%). (Ord. 1405, eff. 2/4/2011)

Sec. 6563 Customer Service.

A.    Customer service standards. A state franchise holder shall comply with Sections 53055, 53055.1, 53055.2 and 53088.2 of the California Government Code; the FCC customer service and notice standards set forth in Sections 76.309, 76.1602, 76.1603, and 76.1619 of Title 47 of the Code of Federal Regulations; Section 637.5 of the California Penal Code; the privacy standards of Section 551 of Title 47 of the United States Code; and, to the extent consistent with DIVCA, all other applicable state and federal customer service and consumer protection standards pertaining to the provision of video service, including any such standards hereafter adopted. In case of a conflict, the stricter standard shall apply. All customer service and consumer protection standards under this paragraph shall be interpreted and applied to accommodate newer or different technologies while meeting or exceeding the goals of the standards.

B.    Penalties for violations of standards. The City shall enforce the compliance of state franchise holders with respect to the state and federal customer service and consumer protection standards set forth in this Section 6563. The City will provide a state franchise holder with a written notice of any alleged material breaches, as defined in California Public Utilities Code Section 5900, of applicable customer service or consumer protection standards, and will allow the state franchise holder thirty (30) days from the receipt of the notice to remedy the specified material breach. Material breaches not remedied by a state franchise holder within the thirty (30) day time period, irrespective of the number of customers affected, will be subject to the following penalties to be imposed by the City:

1.    For the first occurrence of a material breach, a fine of five hundred dollars ($500.00) may be imposed for each day the violation remains in effect, not to exceed one thousand five hundred dollars ($1,500) for each violation.

2.    For a second material breach of the same nature within twelve (12) months, a fine of one thousand dollars ($1,000) may be imposed for each day the violation remains in effect, not to exceed three thousand dollars ($3,000) for each violation.

3.    For a third material breach of the same nature within twelve (12) months, a fine of two thousand five hundred dollars ($2,500) may be imposed for each day the violation remains in effect, not to exceed seven thousand five hundred dollars ($7,500) for each violation.

C.    Any penalties imposed by the City shall be imposed in a manner consistent with California Public Utilities Code Section 5900. (Ord. 1405, eff. 2/4/2011)

Sec. 6564 Permits and Construction.

A.    Except as expressly provided in this section, all provisions of Title VII, Chapter 1, Streets and Sidewalks, and all City administrative rules and regulations developed pursuant to any of these provisions, as now existing or as hereafter amended, shall apply to all work performed by or on behalf of a state franchise holder on any City public rights-of-way, public property, or City easement.

B.    Permits. Prior to commencing any work for which a permit is required by Title VII, Chapter 1, a state franchise holder shall apply for and obtain a permit in accordance with the provisions of said Chapter 1 and shall comply with all other applicable laws and regulations, including but not limited to all applicable requirements of Division 13 of the California Public Resources Code, Section 21000, et seq. (the California Environmental Quality Act).

C.    The City Manager or his designee shall either approve or deny a state franchise holder’s application for any permit required under Title VII, Chapter 1 within sixty (60) days of receiving a completed permit application from the state franchise holder.

D.    If the City Manager or his designee denies a state franchise holder’s application for a permit, the City Manager or his designee shall, at the time of notifying the applicant of denial, furnish to the applicant a detailed explanation of the reason or reasons for the denial.

E.    A state franchise holder that has been denied a permit by final decision of the City Manager or his designee may appeal the denial to the City Council. Upon receiving a notice of appeal, the City Council shall take one (1) of the following actions:

1.    Affirm the action of the City Manager or his designee without any further hearing; or

2.    Refer the matter back to the City Manager or his designee for further review, with or without instructions.

F.    In rendering its decision on the appeal, the City Council shall not hear or consider any argument or evidence of any kind other than the record of the matter received from the City Manager or his designee unless the City Council is itself conducting a public hearing on the matter.

G.    The issuance of a permit is not a franchise, and does not grant any vested rights in any location in the public rights-of-way, or in any particular manner of placement within the rights-of-way. Without limitation, a permit to place cabinets and similar appurtenances aboveground may be revoked and the permittee required to place facilities underground, in accordance with applicable law. (Ord. 1405, eff. 2/4/2011)

Sec. 6565 Emergency Alert System.

Each state franchise holder shall comply with the emergency alert system requirements of the Federal Communications Commission in order that emergency messages may be distributed over the state franchise holder’s network. As such capability was required under local franchises in effect in the City on January 1 through December 30, 2006, and as consistent with Public Utilities Code Section 5880, each state franchise holder shall install and maintain equipment to allow the Humboldt County Emergency Management Office to air audio and video messages on the video system to alert subscribers to emergency situations. This capability shall be remotely activated without the assistance of the state franchise holder and shall allow a representative of the City to override the audio and video on all channels, except those where the grantee has, consistent with FCC regulations, agreed with the broadcaster not to override the channel for EAS messages. (Ord. 1405, eff. 2/4/2011)

Sec. 6566 Public, Educational, and Government Access Channel Capacity, Support, Interconnection, and Signal Carriage.

A.    PEG channel capacity.

1.    A state franchise holder shall designate a sufficient amount of capacity on its network to allow the provision of four (4) PEG channels to satisfy the requirement of Section 5870 of the California Public Utilities Code, within the time limits specified therein.

2.    A state franchise holder shall provide an additional PEG channel when the City satisfies the standards set forth in Section 5870(d) of the California Public Utilities Code or any entity designated by the City to manage one (1) or more of the PEG channels.

B.    PEG support.

1.    Amount of PEG support fee. Any state franchise holder shall pay to the City—or if directed by the City, to the City’s designated PEG provider—a PEG fee equal to one and four hundred one thousandths percent (1.401%) of gross revenues, an amount equivalent to the level of PEG funding remitted by the incumbent cable operator to the City’s designated PEG provider during the period of January 1, 2006, to December 30, 2006.

2.    The PEG support fee shall be used for PEG activities, in a manner that is consistent with the terms of the incumbent cable operator’s franchise during the period of January 1, 2006, to December 30, 2006, and settlements.

3.     A state franchise holder shall remit the PEG support fee quarterly, within forty-five (45) days after the end of each calendar quarter. Each payment made shall be accompanied by a summary, detailing how the PEG support fee was calculated.

4.    In the event that a state franchise holder fails to pay the PEG support fee when due, or underpays the proper amount due, the state franchise holder shall pay interest at the rate per year equal to the highest prime lending rate during the period of delinquency, plus one percent (1%), or the maximum rate specified by state law.

C.    PEG carriage and interconnection.

1.    As set forth in Sections 5870(b) and 5870(g)(3) of the California Public Utilities Code, state franchise holders shall ensure that all PEG channels are receivable by all subscribers, whether they receive digital or analog service, or a combination thereof, without the need for any equipment other than that needed to receive the lowest-cost tier of service. PEG access capacity provided by a state franchise holder shall be of similar quality and functionality to that offered by commercial channels (unless the PEG signal is provided to the state franchise holder at a lower quality or with less functionality), shall be capable of carrying a National Television System Committee (NTSC) television signal, and shall be carried on the state franchise holder’s lowest-cost tier of service. To the extent feasible, the PEG channels shall not be separated numerically from other channels carried on the lowest-cost tier of service and the channel numbers for the PEG channels shall be the same channel numbers used by any incumbent cable operator, unless prohibited by federal law. After the initial designation of the PEG channel numbers, the channel numbers shall not be changed without the agreement of the City unless federal law requires the change.

2.    Where technically feasible, each state franchise holder and each incumbent cable operator shall negotiate in good faith to interconnect their networks for the purpose of providing PEG programming. Interconnection may be accomplished by any means authorized under Public Utilities Code Section 5870(h). Each state franchise holder and incumbent cable operator shall provide interconnection of PEG channels on reasonable terms and conditions and may not withhold the interconnection. If a state franchise holder and an incumbent cable operator cannot reach a mutually acceptable interconnection agreement for PEG carriage, the City may require the incumbent cable operator to allow each state franchise holder to interconnect its network with the incumbent cable operator’s network at a technically feasible point on the state franchise holder’s network as identified by the state franchise holder. If no technically feasible point of interconnection is available, each state franchise holder shall make interconnection available to each PEG channel originator programming a channel in the City and shall provide the facilities necessary for the interconnection. The cost of any interconnection shall be borne by each state franchise holder requesting the interconnection unless otherwise agreed to by the parties. (Ord. 1405, eff. 2/4/2011; Ord. 1471, eff. 1/15/2016)

Sec. 6567 Notices.

A.    Each state franchise holder or applicant for a state franchise shall file with the City a copy of all applications or notices that the state franchise holder or applicant are required to file with the California Public Utilities Commission.

B.    Unless otherwise specified in this section, all notices or other documentation that a state franchise holder is required to provide to the City under this section or the California Public Utilities Code shall be provided to both the City Manager and the City staff person in charge of cable and telecommunications, or their successors or designees. (Ord. 1405, eff. 2/4/2011)