Chapter 12.45
FRANCHISE – CABLE COMMUNICATIONS

Sections:

12.45.010    Franchise required.

12.45.020    Application for franchise – Application fee.

12.45.030    Grant of franchise.

12.45.040    Definitions.

12.45.050    Franchise area and term.

12.45.060    Significance of franchise.

12.45.070    Operation of franchise.

12.45.080    Customer service.

12.45.090    Extension of network and programming.

12.45.100    Occupancy of streets and public easements.

12.45.110    Rights reserved to the city.

12.45.120    Preferential or discriminatory practices prohibited.

12.45.130    Franchise fee and taxes.

12.45.140    Subscriber privacy.

12.45.150    Acceptance of franchise.

12.45.160    Termination of franchise.

12.45.170    Liability and indemnification.

12.45.180    Severability.

12.45.190    Criminal penalties.

12.45.010 Franchise required.

No person or company or provider shall be permitted to construct and/or operate and maintain any cable system which is subject to the Cable Communications Policy Act of 1984, as amended (the Act), without first obtaining a franchise, and then entering into a franchise agreement with the city. Any cable operator not subject to the Act that is providing cable service in competition with a cable system subject to the Act must first obtain a franchise and enter into a franchise agreement with the city. [Ord. 09-116 § 3.17.001, 2009.]

12.45.020 Application for franchise – Application fee.

The city may develop rules and regulations with respect to the submission and processing of applications for a franchise. Each applicant for a franchise shall submit an application to the city for the franchise which shall primarily assist the city in determining the legal, financial, technical and character qualifications of the applicant.

Unless otherwise prohibited, an applicant shall pay an initial or renewal application fee in the amount of $500.00, or an amount shown on a consolidated fee schedule adopted by the city. The total application fee must be paid prior to approval of the applicant’s request for a franchise. [Ord. 09-116 § 3.17.002, 2009.]

12.45.030 Grant of franchise.

This chapter identifies and defines the terms and conditions by which a nonexclusive franchise may be granted to an applicant to erect, construct, operate and maintain upon, along, across, above, over and under the streets, alleys, easements, public ways and public places of Naples City, Utah, any poles, wires, cables or other conductors and fixtures necessary for the interception, sale and distribution of television signals and other services.

A franchise agreement incorporating the terms of this chapter and such other terms and conditions as are deemed appropriate by the city council shall be entered into between the city and the applicant/provider.

In addition to the application fee, any cost or expenses of posting or publication of said franchise shall be borne by the applicant/provider. [Ord. 09-116 § 3.17.010, 2009.]

12.45.040 Definitions.

For the purposes of this chapter, the following terms, phrases and words and their derivatives shall have the meaning specified herein. When not inconsistent with the context, the words used in the present tense include the future and words in the singular number include words in the plural number.

“Basic service” shall mean all communications service provided by the operator, including the delivery of television broadcast signals required by the FCC, covered by the regular monthly charge paid by all subscribers, but shall not include any additional or optional service which is not regularly provided to all subscribers.

“Cable Act” shall mean the Cable Communications Policy Act of 1984, and the Cable Television Consumer Protection and Competition Act of 1992, as amended by the Telecommunications Act of 1996, including 47 U.S.C. Section 521 et seq.

“Cable franchise ordinance” shall mean this chapter as approved or modified by the city council of Naples City.

“Cable television system,” “cable communication system,” and “CATV system” shall mean a system composed of, without limitation, antenna, cables, wires, lines, towers, wave guides, or other conductors, converters, equipment or facilities designed, constructed or used for the purpose of producing, receiving, and amplifying radio, television or other electronic or electrical signals to and from persons, subscribers and locations within the franchise area. Notwithstanding anything contained in this chapter to the contrary, in the event that the operator provides IPTV or cable services via a telecommunications network infrastructure owned, operated and maintained by a third party, the telecommunications network infrastructure owned and/or controlled by a third party, and the rights, duties and obligations of any such third party with respect thereto, shall be governed exclusively by the terms and conditions of the telecommunication franchise agreement between such third party and the city.

“City” shall mean Naples City, Utah, and such reorganized, consolidated, enlarged or reincorporated form as may exist during the term of a franchise. Any act to be performed by the city pursuant to this chapter shall be deemed to be performed by authority of the city manager of the city unless otherwise specifically designated or unless the city’s city council shall specifically designate other individuals or governmental agencies to perform such acts.

“FCC” shall mean the Federal Communications Commission and any legally appointed or elected successors.

“Franchise” shall mean the agreement between the city and any person or entity which incorporates and implements the privileges and covenants of this chapter.

“Gross revenues” or “gross subscriber revenues” means all revenue, unless prohibited by the Cable Act, received by the franchisee from the operation of the cable television system, IPTV system, or IPTV system in the service area; provided, however, that such phrase shall not include any fees or taxes which are imposed directly or indirectly on any subscriber thereof by any governmental unit or agency and which are collected by the franchisee on behalf of such governmental unit or agency. Moneys received by franchisee for other services such as equipment rental fees, advertising insertion fees, data services or traditional voice telephone services are not included in the definition of gross revenues or gross subscriber revenues for purposes of this chapter.

“IPTV” shall mean Internet protocol television, a system where digital broadcast television service is delivered or re-transmitted using Internet protocol over a network infrastructure, which may include delivery of video and sound products by broadband connection.

“IPTV system” means a system composed of, without limitation, antenna, cable wires, lines, towers, wave guides or any other conductors, converters, equipment or facilities designed, constructed or wired for the purpose of producing, receiving, amplifying and distributing by telecommunications network infrastructure, radio, television or other electronic or electrical signals to and from persons, subscribers and locations within the franchise area.

“May” is permissive.

“Network” shall mean the cable television system authorized by this chapter and all of the component physical, operational and technical elements of any network of cables, optical fibers, electrical or electronic equipment or facilities used for the purpose of transmission of electrical impulses of television, radio and other intelligence for sale or use by subscribers to the network in the service area.

“Operator” shall mean the applicant/provider approved by the city after compliance with this chapter.

“Person” shall mean any individual, partnership, association, organization, labor organization, corporation, cooperative, legal representative, trustee or receiver.

“Revenues” shall mean all revenues, fees, payments and charges received by an operator, its affiliates or subsidiaries from subscribers to the network in connection with providing basic or additional or optional service within the service area.

“Service area” shall mean all geographical areas within the incorporated portions of the city and any area hereafter incorporated into the city.

“Shall” and “must” are mandatory and not merely directory.

“State” shall mean the state of Utah.

“Street” or “streets” shall mean such of the following which have been dedicated or deeded to the public or hereafter dedicated or deeded to the public and maintained under public authority and located within the service area: streets, roadways, highways, avenues, lanes, alleys, sidewalks, easements, rights-of-way and similar public ways and extensions and additions thereto, together with such other public property and areas that the city shall permit to be included within the definition of street from time to time. This definition shall not include streets and other improvements not dedicated or deeded to the city including but not limited to streets and improvements owned or maintained by the state of Utah, Uintah County, or private parties.

“Subscriber” shall mean any person who with the knowledge and permission of an operator, receives either basic service or additional or optional service from the operator. [Ord. 09-116 § 3.17.020, 2009.]

12.45.050 Franchise area and term.

(1) Franchise Area. The franchise area shall include all of the service area.

(2) Franchise Term. The city may grant to operator a franchise with up to a five-year term. The franchise may be renewed in accordance with applicable law or ordinance. [Ord. 09-116 § 3.17.030, 2009.]

12.45.060 Significance of franchise.

(1) Franchise Nonexclusive. No franchise shall be exclusive. The city reserves the right to grant a similar franchise to any person at any time in accordance with applicable law, provided no new franchise is more favorable or less burdensome than operator’s franchise.

(2) Franchise Amendable. Conditions of a franchise may be amended from time to time to allow the city and operator to implement new services and technologies and to better meet community needs. No amendments affecting the conditions of a franchise shall be implemented without the mutual written consent of the city and the operator. Notwithstanding the foregoing, the city reserves the right to implement and enforce current provisions and future modifications of the Cable Communications Policy Act of 1984 and applicable laws which convey or preserve powers or duties to a franchising authority, and to amend the provisions of this chapter.

(3) Authority Granted. Execution of a franchise between the city and an operator shall grant to the operator the right and privilege to construct, erect, operate, modify and maintain in, upon, along, above, over and under the streets, alleys, easements (including all easements occupied by any utility operated by the city or any private easements which are occupied by utilities or other compatible uses), public ways and public places and on all poles or through such conduit as may exist, such towers, antennas, cables, electronic equipment, and other network appurtenances necessary for the operation of the network in the city; provided, however, that the exercise of such right and privilege shall not interfere with the use of such streets by the city and such others as designated by the city to use such streets and public ways; and provided, that the exercise of such right and privilege shall not be in conflict with any ordinance, procedure, code or regulation of the city.

(4) Consent Prior to Transfer of Franchise. The franchise described herein is a privilege to be held for the benefit of the public. The franchise shall not be sold, transferred, leased, assigned or disposed of, including, but not limited to, by force or voluntary sale, merger, consideration, receivership, foreclosure or other means without the express written consent of the city council of the city; provided, however, that denial of such consent shall not be unreasonable, arbitrary or capricious. The city shall express its approval or denial within 90 days of receiving written notice of any action to transfer the franchise. In no event shall a transfer of ownership or control be effective without a successor in interest becoming a signatory to the franchise by providing the city written acceptance of all provisions of this chapter in a form acceptable to the city. Failure to provide acceptable written acceptance shall be cause for revocation of the franchise.

(5) Mortgage or Pledge of Network. Nothing in this chapter shall be deemed to prohibit the mortgage or pledge of any property of the operator, real or personal, including the network or any part thereof or a leasing by another person of said property or part thereof for financing purposes or otherwise. The granting of a security interest in the franchise, whether by assignment, pledge, mortgage or otherwise, in connection with a financing or a refinancing shall not require the consent of the city. However, any such mortgage, pledge or lease shall be subject to the rights and conditions of this chapter and other applicable laws.

(6) No Right of Property. The award of any franchise shall not impart to operator any right of ownership of streets or city owned property or ownership of easements.

(7) Franchise Binding. Upon execution of an agreement consistent with this chapter, this chapter shall be binding upon the operator, its successors, lessees or assignees and the city. This chapter shall inure to the benefit of any entity which is controlled by, or under common control with, the operator.

(8) Compliance with Laws, Rules and Regulations. The operator, at its expense, shall comply with all laws, orders and regulations of federal, state and municipal authorities and with any direction of any public officer or officers pursuant to law who shall legally impose any regulations, orders or duties upon the operator which are consistent with this chapter. [Ord. 09-116 § 3.17.040, 2009.]

12.45.070 Operation of franchise.

(1) Operator Rules and Regulations. The operator may adopt rules, regulations, terms, and conditions governing the conduct of its business as are reasonably necessary to enable the operator to exercise its rights and perform its obligations under the franchise and to assure an uninterrupted service to each and all of its customers. Any such rules, regulations, terms and conditions shall be in compliance with this chapter and with applicable state and federal laws, rules, and regulations. Copies of all rules, regulations, terms and conditions including subscriber agreements together with any amendments, additions or deletions thereto, shall be kept currently on file with the city official designated to enforce provisions of this chapter.

(2) Transmission Signals. The operator shall provide each subscriber with transmission signals which are in compliance with the technical and performance standards of the FCC. The operator shall maintain proof of performance and system maintenance tests in accordance with FCC standards and shall provide access to such documentation to the city upon reasonable request.

(3) Signal Disruption. The operator shall respond to subscriber outages or poor signal reception within 36 hours. The operator shall respond to problems involving 25 percent or more of the subscribers in the service area within 24 hours, including nonbusiness hours. Service and technical employees of the operator shall be clearly identified as employees of the operator. Repairs to the network shall be made with as little interruption of service as possible. Planned interruptions shall be preceded by a 24-hour notice to all affected subscribers. When possible, planned interruptions shall be scheduled at times of minimum subscriber viewing.

(4) Credit for Interrupted Service. Subscribers shall be granted, upon request, a credit for interrupted service which exceeds 24 hours. The credit shall equal a prorated amount of the subscriber’s total monthly bill for basic and optional or additional service and the total number of hours that service is interrupted.

(5) Complaint File and Reports. The operator shall keep an accurate and comprehensive file of all complaints regarding the cable communications system and the operator’s actions in response to those complaints. The operator shall also maintain a log and summary of all service interruptions during any 12-month period. The files shall be available within 48 hours’ notice given by the city for inspection by the city during normal business hours provided such inspection does not conflict with the privacy provisions of the Cable Act and this chapter.

(6) Notification of Access to Property. The operator shall provide notice as is reasonable to subscribers and property owners before it enters upon or crosses any private property in order to access a public easement or right-of-way. For any type of construction, reasonable notice shall include personal contact with the owner or resident (at least 18 years of age) at least three days prior to the access. Reasonable notice shall also include mailing or posting the property with a description of the work to be done, the purpose and time of the work, and the authority under which the operator may have access. All notices whether written or in person shall include a telephone number that individuals may call to ask questions or obtain additional information.

(7) Restoration by Operator. The operator shall repair, refill, replace and otherwise restore at its own expense any private or public property disrupted or damaged as a result of excavation, construction, maintenance or repair that may be caused by it and shall leave all ways and places in as reasonably good condition as that prevailing prior to the operator’s activities without affecting any electrical or telephone cables, wires, or attachments and poles.

(8) Restoration by City – Reimbursement of Costs. In the event of a failure by the operator to complete within 10 working days of completion of construction any restoration work required by this chapter, or any other work required by city ordinance, within the time established and to the satisfaction of the city, the city shall give the operator, by registered mail, five working days’ notice to correct the failure. If after the notice period, the operator has not corrected the failure, the city may cause such work to be done and the operator shall reimburse the city the costs thereof within 30 days prior to the effective date of the change.

(9) Notification of Change in Service. The operator shall provide reasonable notice to subscribers and the city of any changes in service including but not limited to changes in available channels, tiers of service, and cost of service. Reasonable notice shall include printed notice to all subscribers and a letter to the city which details the change in service distributed at least 30 days prior to the effective date of the change. The city may require a listing of existing rates in other comparable service areas of the operator within the state of Utah.

(10) Rates. The operator shall establish rates for its services and shall apply those rates fairly and uniformly to all subscribers in the service area. The operator may conduct promotional campaigns in which its rates are discounted or waived, or offer bulk discounts for multiple dwelling units, hotels, motels and similar institutions. The city may regulate rates to the extent permitted by applicable law.

(11) Compliance. The operator shall provide to the city, upon request, but no more often than quarterly, the information necessary to monitor compliance with the standards set forth in this chapter. The operator shall not be held accountable for conditions acknowledged by the city to be beyond its reasonable control. If the operator fails to respond to a subscriber complaint as described in this section, the city shall give the operator written notice detailing such a violation. The operator shall then have 15 working days to comply with the standards or to represent to the city that it has made substantial progress toward compliance. In the event the violation continues beyond 15 working days, the operator shall pay the city $100.00 per day for each day the violation continues. The daily fine shall increase each five working days by $100.00 to a maximum fine of $250.00 per day. The fine is for the express purpose of ensuring that the operator complies with the service performance requirements of this chapter. The fact that the assessment against the operator is denominated as a fine or is construed to be a penalty shall not be grounds for invalidation of the provision. The fine represents a fair and reasonable estimation of an amount of liquidated damages, which the operator agrees to pay, occasioned by the failure of the operator to abide by the service requirements of this chapter. The city is the proper recipient of such liquidated damages occasioned by the breach of the service requirements. The operator shall pay the fine directly to the city. The city reserves the right to make demand on the surety bond in the event the operator does not volunteer the payments. In all cases where the operator is given notice by the city that a violation exists, the operator may, during the 15-day notice period, request an opportunity to present to the city council of the city evidence as to why the fine should not be imposed. The city council may enforce, modify or suspend the fine based on a review of the violation and based on the evidence provided by the operator. The decision of the city council shall be final and shall exhaust all administrative appeals through the city. [Ord. 09-116 § 3.17.050, 2009.]

12.45.080 Customer service.

(1) Local Office. Unless waived by the city, the operator shall maintain an office within the city as well as a local telephone listing which will accommodate customer walk-in traffic and requests for service connections and disconnections, request for maintenance service, any change of additional or optional service, and any questions regarding programming or billing. The office shall be open during normal business hours: at least seven hours Monday through Friday. If the operator is required to provide a local office as prescribed in this section, then the city and the operator agree that the costs of meeting this requirement can be treated as an external cost, subject to pass through to subscribers, pursuant to the Cable Act.

(2) Telephone Equipment. The operator shall maintain adequate telephone equipment to receive incoming calls. The operator shall list the telephone number that provides 24 hours a day customer assistance. The local office hours, if a local office is maintained, and telephone number for customer shall be noticed in the monthly billing statements.

(3) Customer Service Representative. All telephone calls and all local office walk-in customers, if a local office is maintained, shall be assisted by a customer service representative or a device capable of problem resolution. The operator shall periodically train all customer service representatives to accurately and courteously respond to customer requests.

(4) Requests for Services. A minimum of 90 percent of all customer requests for connection or modification of service shall be completed within 15 working days and in conformance with NCC 12.45.090(3). A minimum of 90 percent of all appointments for repair or service scheduled by the operator and an individual subscriber shall be met by the operator on the day of the appointed repair or service. As expeditiously as reasonably possible after receipt of any subscriber complaint regarding any service provided by the operator, and in any event within four working days, the operator shall investigate and resolve the complaint to the extent reasonably possible.

(5) Notice to Subscribers. At the time of entering into an agreement to provide service and once a year thereafter, the operator, either in writing or electronic via the operator’s website, shall provide each subscriber with written information concerning:

(a) The procedures for making inquiries or complaints, including the name, address, and local telephone number of the employee or agent to whom inquiries or complaints are to be directed;

(b) The city official designated to be responsible for regulating the franchise, including the title and telephone number of the official; and

(c) The operator’s business hours, legal holidays, telephone number and procedures for responding to inquiries after normal business hours. Operator shall include the above-referenced notices as part of its normal, federally required mailings. [Ord. 09-116 § 3.17.060, 2009.]

12.45.090 Extension of network and programming.

(1) Extension throughout Service Area. Service shall be extended to all properties where a minimum of 10 living units are occupied within a quarter linear mile of any area currently serviced by the operator. New construction shall be in accordance with an annual schedule accepted and approved by the city.

(2) The franchisee, in its discretion, may choose to serve customers on either the CATV system or the IPTV system, but shall not be required to build both to every person in the franchise area.

(3) Whenever the franchisee receives a request for services from a subscriber in a contiguous un-served area where there are at least 10 residents within 1,320 cable-bearing strand feet (one-quarter mile) from the portion of the franchisee’s trunk or distribution line which is to be extended, it shall, subject to the provisions of subsection (6) of this section, extend its system to such subscribers at no cost to said subscribers for the system extension, other than the published standard installation fees charged to all subscribers; provided, that the quality of service normally provided by the operator can be obtained at that location. If the provider determines that it cannot provide such service, it shall notify the city of such determination in writing detailing the reasons why such service cannot be provided. Such notification shall be presented to the city council for their review and final determination. In instances when the distance from distribution line is greater than 1,320 cable-bearing strand feet, service may be made available on the basis of costs of materials, labor and easements, paid in advance by the subscriber, in order to prevent inequitable burdens on cable subscribers in more densely populated areas.

(4) Nondiscriminatory Service. Construction of the network shall be performed by the operator in such a manner as to ensure that no group of potential subscribers is denied access to services because of the income level of the group or because of the relative cost of extending services into the particular area in which the group resides; provided, however, that such extension may be denied based upon the density requirements stated above.

(5) Service to Public Facilities. The operator shall provide at no cost, one basic service outlet to all city buildings, fire houses, police stations, colleges, universities, public schools, and libraries, upon request, which are within the city, and passed by the network. An additional service outlet shall also be provided in each room or area where television reception is desired in any of the above-mentioned buildings; provided, that the operator shall be reimbursed its actual cost for labor and materials required in the installation of such service outlets which are additional to the main outlet. Three of the public facilities, to be determined by the city, receiving such service shall be exempt from any monthly service fees or charges for such service.

(6) Type of Programming. The city may suggest, from time to time, broad categories of video programming and other services that are compatible with community needs and interests as identified by the city. The operator shall not offer programming which is obscene, or is otherwise unprotected by the Constitution of the United States.

(7) Public, Education and Government Access Channel. The city shall have reasonable access to the use of one dedicated channel for public, educational, and governmental purposes.

(8) Emergency Use. In the case of any emergency or disaster, the operator shall, upon request of the city, make available its “Emergency Alert System” facilities for the city to provide emergency information and instructions during the emergency or disaster period. The city agrees to cooperate with other local governmental entities regarding the use of the override capabilities in order to prevent two or more governmental entities from demanding use of the system at the same time. Except, to the extent expressly prohibited by law, the city shall hold the operator, its employees, officers, and assigns, harmless from any claims arising out of the emergency use of its facilities by the city. [Ord. 09-116 § 3.17.070, 2009.]

12.45.100 Occupancy of streets and public easements.

(1) Existing Facilities. The operator shall utilize existing poles, conduits, and other facilities whenever feasible and shall not construct or install any new, different, or additional poles, conduits, or other facilities whether on public or private property until the written approval of the city is obtained.

(2) Underground Installation. The facilities of the operator shall be installed underground to the fullest extent possible. In areas where either telephone or electric utility facilities are installed aerially at the time of construction of the network, the operator may install its facilities aerially with the understanding that at such time as both telephone and electrical facilities are relocated underground, the operator shall likewise place its facilities underground. Previously installed aerial cable shall be relocated in concert with other utilities at the operator’s cost when the other utilities convert from aerial to underground construction. Any streets or sidewalks damaged or disturbed in the construction or operation of operator’s poles, cables and other installations shall be promptly repaired and restored by the operator at its expense and to the reasonable satisfaction of the city.

(3) Location and Condition. The operator shall locate all transmission lines, equipment, and structures so as to cause minimum interference with the rights and reasonable convenience of property owners. The operator shall install and maintain its lines, equipment, and structures in accordance with the requirements of the National Electrical Safety Code promulgated by the National Bureau of Standards and the National Electrical Code of the National Board of Fire Underwriters.

(4) Excavation Permits. The operator shall not open or disturb the surface of any street, sidewalk, driveway, or public place for any purpose without first obtaining a permit to do so from the city. In addition, where existing conduit or backyard easements are not available for underground installation, the operator shall design the network in such a manner as to permit construction behind and parallel with street curbing, in parking strips, or under the sidewalks where available, with a minimum of street excavation.

(5) Use of Easements. The operator may install network facilities in public utility easements. Upon commencement of installation of facilities in a public utility easement, the operator shall proceed diligently to complete the installation. No trenches or otherwise uncovered areas shall be left open longer than allowed by the terms of the encroachment permit as provided by the city.

(6) Changes Required by Public Improvements. The operator shall, at its expense, temporarily disconnect, relocate or remove from the street or other public place any property of the operator when required by the city by reason of traffic conditions, public safety, street vacation, street construction, installation of sewers, drains, water pipes, or any other type of structure or improvement by public agencies. If the city elects to change the grade of any street or public way, or to vacate or otherwise alter the same, the operator shall relocate its poles and other installations at its expense.

(7) Protection of Facilities. Nothing contained in this section shall relieve the city or any person, company or corporation from liability arising out of the failure to exercise reasonable care to avoid damaging the operator’s facilities while performing any work connected with grading, regrading, or changing the line of any street or public place or with the construction or reconstruction of any sewer or water system.

(8) Requests for Removal or Change. The operator shall, at the request of any person holding a building or moving permit, temporarily raise or lower its wires to permit the building or moving to proceed. The expense of such temporary removal, raising or lowering of wires shall be paid by the person requesting the action, and the operator shall have the authority to require such payment in advance. The operator shall be given no less than five days’ written notice of any move contemplated to arrange for temporary wire changes.

(9) Authority to Trim Trees. The operator shall have the authority to trim trees upon and overhanging streets, alleys, sidewalks, and other public places of the city so as to prevent the branches of such trees from coming in contact with the wires and cables of the operator. The same requirements for reasonable notice that are specified for access to private property shall be required prior to trimming trees.

(10) Restoration or Reimbursements. In the event of disturbance of any street or private property by the operator, the operator shall, at its own expense and in a manner approved by the city or the owner, replace and restore such street or private property in as reasonably good a condition as before the work causing such disturbance was done. All restoration work shall be guaranteed by the operator for a period of one year to be free from structural defects. In the event there is any problem with restoration work, the operator shall, upon written notice from the city, repair the defect within 15 days (weather permitting) of receiving notice unless otherwise agreed upon by the city. In the event operator fails to perform such replacement or restoration, the city shall have the right to do so at the sole expense of operator.

(11) Emergency Removal of Network. If in the case of fire or disaster in the city it shall become necessary in the reasonable judgment of the city to cut or move any of the wires, cables, amplifiers or other appurtenances to the network of the operator, such cutting or moving may be completed. Any repairs rendered necessary thereby shall be made by the operator at its sole expense.

(12) Alternate Routing of Network. In the event continued use of a street or other easement or right-of-way is denied to the operator by the city, the operator shall provide service to the affected subscribers over alternate routes within a reasonable period of time agreed upon by the city. [Ord. 09-116 § 3.17.080, 2009.]

12.45.110 Rights reserved to the city.

(1) Operator Agrees to City’s Rights. The city reserves such rights and powers, including the lawful exercise of police power, which under applicable federal, state or city law or regulations, the city must reserve and maintain. The operator agrees to comply with all rules and regulations now in effect or hereafter adopted by the city, the Federal Communications Commission, the state of Utah and the United States Government.

(2) City’s Right of Inspection. The city may inspect all construction or installation work performed pursuant to this chapter and may upon reasonable notice inspect all records of the operator related to service in the service area in order to ensure compliance with the terms and conditions of the franchise. [Ord. 09-116 § 3.17.090, 2009.]

12.45.120 Preferential or discriminatory practices prohibited.

(1) Equal Employment Opportunity. The operator shall comply with all federal, state and local laws pertaining to equal employment opportunity. The operator shall establish and maintain employment practices which provide that no individual shall be discriminated against with respect to compensation, terms, conditions or other privileges of employment because of handicap, race, color, religion, age, sex or national origin.

(2) Services to Be Equally Available. The operator shall not, as to rates, charges, service, rules, regulations or in any other respect make or grant any preference or advantage to any person, nor subject any person to any prejudice or disadvantage. This provision shall not be deemed to prohibit promotional campaigns to stimulate subscription to the network or other legitimate uses thereof; nor shall it be deemed to prohibit the establishment of a graduated scale of charges and classified rate schedules to which any customer coming within such classifications shall be entitled, nor shall it be deemed to prohibit differential rates designed to meet competition. [Ord. 09-116 § 3.17.100, 2009.]

12.45.130 Franchise fee and taxes.

(1) The payment of franchise fees for the CATV system governed by 47 U.S.C. Section 542 and IPTV service. Franchisee shall pay a franchise fee equal to five percent of its annual gross revenue received by franchisee from the provision of CATV or IPTV services over the cable system within the city. Said franchise fee shall be paid quarterly on or before March 1st, June 1st, September 1st, and December 1st of each year for the calendar quarter immediately preceding the date of such payment. For any 12-month period, the franchise fees paid by franchisee with respect to the IPTV service shall not exceed five percent of franchisee’s gross revenues derived in such period from the provision of IPTV services. The city shall have access to the franchisee’s records, upon written request, to verify the amount due to the city.

(2) If the FCC, Congress or other governmental entity with authority changes the maximum franchise fee allowed, then the city and franchisee agree to establish the franchise fee to be paid to the city from that point in time forward as the maximum franchise fee allowable by law, unless otherwise negotiated and agreed to by both the franchisee and the city in writing. A new franchise agreement may be negotiated and entered into between the city and franchisee or an addendum to this franchise agreement may be agreed upon by the city and franchisee relative to any new or updated terms and/or franchise fee calculations if necessary or required.

(3) Verification. All books and records showing the revenues of the operator shall be open at all reasonable times to the inspection of the city or agent appointed by the city.

(4) Additional Compensation. If any payment amount is not made on or before the dates specified, the operator shall pay as additional compensation:

(a) An interest charge of 10 percent per annum.

(b) The acceptance of any payment by the city may not be construed as a release or as an accord and satisfaction of any claim the city may have for further and additional sums payable as a utility tax under this chapter or for the performance of any other obligation of the operator.

(5) Pass Through Fees. Any operator “pass through” or itemization of the utility tax on subscriber’s bills shall be in accordance with applicable law. [Ord. 09-116 § 3.17.110, 2009.]

12.45.140 Subscriber privacy.

(1) Collection of Information. The operator will not use the cable system to collect personally identifiable information concerning any subscriber without the prior written or electronic consent of the subscriber concerned except to obtain information necessary to render service to the subscriber or to detect the unauthorized reception of cable communications.

(2) Dissemination of Information. The operator shall not disclose personally identifiable information concerning any subscriber without the prior written or electronic consent of the subscriber concerned except in the following circumstances:

(a) Where the disclosure is necessary to render or conduct a legitimate business activity related to any service provided by the operator to the subscriber;

(b) Where the disclosure is made pursuant to a court order authorizing such disclosure, if the subscriber is notified of such order by the operator; and

(c) Where the disclosure consists only of the names and addresses of subscribers and the operator has provided the subscriber the opportunity to prohibit or limit such disclosure.

(3) Access to Information. Upon written request, the operator shall make available to a subscriber all personally identifiable information regarding that subscriber which is collected and maintained by the operator at reasonable times and at a convenient place designated by the operator. A cable subscriber shall be provided reasonable opportunity to correct any error in such information.

(4) Destruction of Records. Personally identifiable information shall be destroyed by the operator when retention of that information is no longer needed. [Ord. 09-116 § 3.17.120, 2009.]

12.45.150 Acceptance of franchise.

(1) Effective Date of Franchise. A franchise, together with the rights, privileges and authority granted thereby, shall take effect and be in force as of the date provided herein, upon adoption of the franchise agreement by the city council of the city, and compliance by the operator with the following:

(a) The operator shall properly execute the franchise agreement.

(b) The operator shall establish the surety bond as required by this section.

(c) The operator shall file with the city a certificate of insurance as required by this section.

(d) The operator shall advise the city in writing of its local office and its address for mail and official notifications from the city.

(2) Surety Bond. Within 30 days after execution of the franchise agreement, the operator shall provide a surety bond to the benefit of the city in the amount of $10,000. The surety bond shall be in a form approved by the city and shall be maintained throughout the term of the franchise.

The bond shall guarantee payment to the city, as restricted by this chapter, if the operator fails to comply with any provision of this chapter or any applicable law or regulation regulating cable television services. The surety company shall be authorized to transact surety business in the state of Utah. Multiple and partial drawings on the bond shall be permitted. The operator may provide the surety bond in the form of an irrevocable letter of credit.

Any letter of credit must be on forms and with language approved by the city. The surety bond shall be established as security to the city for the faithful performance of the operator of all the provisions of this chapter and compliance with all orders, permits and directions of any agency of the city having jurisdiction over the operator’s acts or defaults under the franchise or any other provision of city code.

The bond shall also act as security to the city for the payment by the operator of any claims, liens, and taxes due to the city that arise by reason of the construction, operation, or maintenance of the network.

No demands shall be made on the surety bond without providing the operator opportunity to correct the default. Within 30 days of notice that any amount has been demanded from the surety bond, the operator shall restore the bond to the original amount.

(3) Public Liability Insurance. Within 30 days after execution of the franchise agreement, the operator shall provide proof of general comprehensive liability insurance coverage protecting the city against liability for loss or damage for personal injury, death, or property damage, occasioned by the operations of operator under this chapter, in the amount of (a) $2,000,000 for bodily injury or death to any one person, within the limits, however, of $2,000,000 for bodily injury or death resulting from any one accident, (b) $500,000 for property damage resulting from any one accident.

The insurance policies referred to above shall contain an endorsement stating that the policies are extended to cover the liability assumed by the operator under the terms of this chapter and shall show the city as an additional insured.

(a) The provider’s public and personal liability and property damage insurance policy shall specifically include the city, the mayor, the council, their officials, agents, employees or representatives as additional insured.

(b) The public and personal liability and property damage insurance policy shall be issued by an agent or representative of an insurance company licensed to do business in the state, and which has one of three highest or best ratings from the Alfred M. Best Company, and which is acceptable to the city, or has been rated acceptable by the state.

(c) The public liability and property damage insurance policy shall contain an endorsement obligating the insurance company to furnish the mayor with at least 30 days’ written notice in advance of the cancellation of the insurance.

(4) Workers’ Compensation Insurance. A provider shall secure and maintain for as long as it provides service to subscribers workers’ compensation insurance, in accordance with the laws of the state. Annually, a certificate shall be filed with the city by either the insurance carrier or provider showing such insurance to be in force.

It is hereby understood and agreed that this policy may not be canceled nor the amount of coverage thereof reduced until 30 days after receipt by Naples City by registered mail of written notice of such intent to cancel or reduce the coverage.

(5) Evidence of Insurance Filed with City. Certificates of insurance for all insurance policies together with written evidence of payment of required premiums shall be filed and maintained with the city during the term of the franchise or any renewal thereof. Certified copies of insurance policies shall be provided to the city upon reasonable request.

(6) Inducements Not Offered. The operator, by acceptance of the franchise agreement, acknowledges that it has not been induced to accept the franchise by any understanding or promise or other statement, whether verbal or written, by or on behalf of the city concerning any term or condition of the franchise.

(7) Operator Accepts Terms of Franchise. The operator, by acceptance of the franchise agreement, acknowledges that it has thoroughly examined and is familiar with the terms and conditions of this chapter. [Ord. 09-116 § 3.17.130, 2009.]

12.45.160 Termination of franchise.

(1) Termination by Operator. The operator may, at its option, terminate the franchise and surrender all rights and privileges associated with the franchise upon filing with the city a written notification of its intent to terminate the franchise and surrender all rights thereunder. Any such termination shall not become effective for a period of 90 days from the date on which the operator files notification with the city. During this 90-day period, the operator may request that the city consider a withdrawal of any notification of termination filed under this section. If the city approves such a request, the franchise and the rights and responsibilities of the parties thereunder will continue unimpaired as if the notification of termination had never been filed.

(2) Termination by City. A franchise may be terminated by the city for any material violation of the franchise but only after a hearing before the city council. Prior to setting a termination hearing, the operator shall be given at least 60 days’ notice by certified mail that the operator has violated a material provision of the franchise and that the city council will consider setting a termination hearing. The notice shall include a description of the violation which is grounds for conducting a termination hearing.

In the event that the operator has not cured the matter which constitutes a material violation of the franchise within the 60-day notice period, or has not commenced, in the opinion of the city, reasonable and diligent efforts to cure the matter, the city council may set a public hearing to determine whether or not the franchise should be terminated. The city shall provide 30 days’ written notice to the operator of the date and time of the termination hearing. The hearing shall be a public proceeding affording due process. The city council shall consider the evidence and determine whether or not the franchise should be terminated. The decision of the city council shall be final and shall exhaust any appeal through the city.

(3) Ownership of Network. Upon termination of a franchise, the operator or its successors and assigns shall retain ownership of the network and shall be entitled at their option and expense to transfer or abandon the network. Any transfer of franchise and any transfer of ownership of the network shall meet the conditions of NCC 12.45.060(4) and the Cable Act. [Ord. 09-116 § 3.17.140, 2009.]

12.45.170 Liability and indemnification.

(1) Indemnification of City in Franchise Operation. The operator shall fully indemnify, defend and hold harmless the city, its officers, boards, commissions, elected officials, agents, attorneys, representatives, servants and employees against any and all costs, damages, expenses, claims, suits, actions, liabilities and judgments for damages, including, but not limited to, expenses for legal fees, whether suit be brought or not, and disbursements and liabilities incurred by the city and arising out of the operation of the operator’s cable television system in connection with the following:

(a) Damage to persons or property, in any way arising out of or through the acts or omissions of the operator, its servants, officials, agents, attorneys, representatives or employees or to which the operator’s negligence or that of its servants, agents, officials, attorneys, representatives or employees shall in any way contribute;

(b) Requests for relief in connection with any programming carried on the operator’s cable system arising out of any claim for invasion of the right of privacy; for defamation of any person, firm or corporation; for the infringement or violation of any copyright, trademark, trade name, service mark or patent; or of any other right of any person, firm, or corporation, excluding claims arising out of or relating to the programming carried on the public, education, and government access channel unless such programming is provided by the operator; and

(c) Any and all claims arising out of the operator’s failure to comply with the provisions of this chapter or any federal, state or local law, ordinance or regulation applicable to the operator or the network.

(2) Defense of the City. If suit for which the operator has agreed to indemnify the city as set forth in the preceding subsection is brought or threatened against the city, either independently or jointly with the operator, or with any other person or municipality; the operator, upon timely written notice given by the city, shall defend the city at the cost of the operator. No right of indemnification shall be effective until such notice and a copy of the suit or other action for which indemnification is sought is provided to the operator. If final judgment is obtained against the city, either independently or jointly with the operator or any of the defendants, the operator shall indemnify the city and pay such judgment with all costs and satisfy and discharge the same as against the city in accordance with this section.

(3) Cooperation in Defense of City. In the event that the city elects to invoke its right of indemnification as set forth in this chapter, the city will use its best efforts to cooperate fully with the operator in defending the city against any and all claims for which indemnification is sought. The operator shall be subrogated to all rights of the city and, in defending the city, shall be entitled to assert any defense to any third party claim which the city would be entitled to assert. A waiver of any rights or defenses by the city shall excuse the operator from all indemnification obligations under this chapter. The city may, in its sole discretion, elect to conduct its own defense at its own expense by giving the operator written notice of the city’s intent to provide its own defense and, upon such election, the operator shall have no further duty to indemnify the city for any costs or liabilities with respect to such claims.

(4) Governmental Immunity. The city is in no manner or means waiving any governmental immunity it may enjoy or any immunity for its agents, officials, servants, attorneys, representatives and/or employees.

(5) Notification of Settlement. The operator shall make no settlement in any matter identified above without the city’s written consent, which shall not be unreasonably withheld. Failure to inform the city of settlement shall constitute a breach of this chapter and the city may seek any redress available to it against the operator whether set forth in this chapter or under any other municipal, state or federal laws. In the event that the city fails to accept any bona fide settlement offer which the operator is willing to accept as full settlement of any claim or claims for which it is required to indemnify the city, the operator’s indemnification liability to the city with respect to said claim or claims under this chapter shall be limited to the terms of the settlement offer and the operator shall be excused from any further indemnification to, or incurring any additional costs on behalf of, the city with respect to said claim or claims.

(6) A franchise shall not in any manner prevent the city from entering into other similar agreements or granting other or further franchises in, under, on, across, over, through, along or below any of said public ways of the city. However, the city shall exercise reasonable care to avoid permitting any such future franchisee from physically or electronically interfering with the franchisee’s communication facilities. In the event that such physical interference or disruption occurs, the city engineer may assist the franchisee and such subsequent franchisee in resolving the dispute. In no event shall the city be financially liable for any interference resulting from the actions of another franchisee. This franchise shall in no way prevent or prohibit the city from using any of its public ways or affect its jurisdiction over them or any part of them, and the city shall retain power to make all necessary changes, relocations, repairs, maintenance, establishment, improvement, dedication of the same as the city may deem fit, including the dedication, establishment, maintenance, and improvement of all new public ways all in compliance with this franchise.

(7) Additional Rights. All rights of the city pursuant to indemnification, insurance, surety bond, letter of credit or performance bonds, as provided for by this chapter, are in addition to all other rights the city may have under this chapter or any other ordinance, rule, regulation or law.

(8) Exercise of Rights. The city’s or the operator’s exercise of or failure to exercise any rights pursuant to any section of this chapter shall not affect in any way the right of the city or the operator subsequently to exercise any such rights or any other right of the city or the operator under this chapter or any other ordinance, rule, regulation or law.

(9) Reasonable Indemnification. It is the purpose of this section to provide reasonable indemnification to the city under the terms and conditions expressed and, in the event of a dispute, this section shall be construed (to the greatest extent permitted by law) to provide for the indemnification of the city by the operator in accordance with its terms.

(10) Validity of Section. The provisions of this section shall not be dependent or conditioned upon the validity of this chapter or the validity of any of the procedures or agreements involved in the renewal of the franchise, but shall be and remain a binding right and obligation of the city and the operator even if part or all of this chapter, or the grant or renewal of the franchise, is declared null and void in a legal or administrative proceeding. It is expressly the intent of the operator and the city that the provisions of this section survive any such declaration and shall be a binding obligation of and inure to the benefit of the operator and the city and their respective successors and assigns (if any) with respect to any claims arising out of the operation of the cable system covering the period of time during which the operator provided cable service within the city.

(11) General Capability. Because technology is rapidly changing, it is difficult for the city to set a standard by which the operator will upgrade and maintain the system in the city. Therefore, insofar as it is technically and economically feasible, operators shall upgrade and maintain the system quality equal to or better than the best system that the grantee provides to any community in the Basin (TriCounty area) where it has a franchise. [Ord. 09-116 § 3.17.150, 2009.]

12.45.180 Severability.

If any section, subsection, sentence, clause, phrase or word of this chapter is for any reason held invalid by the FCC or unconstitutional by any court of competent jurisdiction, such section, subsection, sentence, clause, phrase or word shall be deemed a separate, distinct and independent provision and such holding shall not affect the validity of the remaining portions thereof or of this chapter. The operator shall not be bound by the provisions of any ordinances which are inconsistent with the terms of this chapter.

The provisions of this chapter shall be severable, and if any provision thereof or the application of such provision under any circumstances is held invalid, it shall not affect the validity of any other provision of this chapter or the application in a different circumstance. [Ord. 09-116 § 3.17.160, 2009.]

12.45.190 Criminal penalties.

(1) Any violation or failure to abide by, and comply with, any provision or requirement of this chapter shall be a violation of the Naples City Code and shall be punished as a class B misdemeanor unless otherwise provided by state law.

(2) In addition to those criminal and civil remedies provided by state and federal law, it shall be a misdemeanor for any person to create or make use of any unauthorized connection, whether physically, electrically, acoustically, inductively, or otherwise with any part of a provider’s cable system without the express consent of the provider. Further, without the express consent of the provider, it shall be a misdemeanor for any person to tamper with, remove, or injure any property, equipment, or part of the provider’s cable system or any means of receiving cable service or other services provided thereto. [Ord. 09-116 § 3.17.170, 2009.]