Chapter 13.06
STATE VIDEO SERVICE FRANCHISEES Revised 3/18

Sections:

13.06.010    Purpose.

13.06.020    Definitions.

13.06.030    Administration and regulations.

13.06.040    Construction, operation, maintenance and repair.

13.06.050    Franchise fee.

13.06.060    Public, educational, and government access channel capacity, interconnection, signal carriage and support.

13.06.070    Audits and records.

13.06.080    Customer service.

13.06.090    Encroachment permits—Procedures for appeal of denial.

13.06.100    Emergency alert system.

13.06.110    Notices.

13.06.120    Severability.

13.06.130    Automatic reauthorization. Revised 3/18

13.06.010 Purpose.

It is the purpose of this chapter to implement within the city the provisions of Digital Infrastructure and Video Competition Act of 2006 (DIVCA), codified at Public Utilities Code Sections 5800, et seq., 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 Sections 5830(h) and 5830(k) of the California Public Utilities Code. (Ord. 934 § 1, 2008)

13.06.020 Definitions.

For the purposes of this chapter, the following words, terms, phrases, and abbreviations and their similar formulations shall have the meanings given them in this chapter. Words not defined in this chapter shall have the same meaning as established in: (1) DIVCA, and, if not defined therein; (2) Public Utility Commission rules implementing DIVCA, and, if not defined therein; (3) Chapter 5 of Title 47 of the United States Code, and, if not defined therein; (4) their common and ordinary meaning. References to governmental entities (whether persons or entities) shall refer to those entities or their successors in authority. If a specific provision of law referred to in this chapter should be renumbered, then the reference shall be read to refer to the renumbered provision. References to any law shall be interpreted broadly to cover government actions, however nominated, including any law or ordinances now in force or subsequently enacted or amended.

A. “Access,” “PEG access,” or “PEG use” means the availability of cable system or video service provider network capacity for public, educational or governmental use by various agencies, institutions, organizations, groups, and individuals, including the city and its designated access providers, to acquire, create and distribute programming not under a cable operator’s or video service provider’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 nondiscriminatory basis, are the primary or designated programmers or users having editorial control over their programming;

2. “Educational access” or “educational use” means access where accredited educational institutions are the primary or designated programmers or users having editorial control over their programming; and

3. “Governmental access” or “governmental use” means access where governmental institutions or their designees are the primary or designated programmers or users having editorial control over their programming.

B. “Cable coordinator” means the city manager or the individual(s) designated by the city manager to administer oversight of state franchisees in the city.

C. “Channel” means a portion of the electromagnetic frequency spectrum which is used in a cable system or the network of a video service provider 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.

D. “Commission” means the California Public Utilities Commission.

E. “DIVCA” means the Digital Infrastructure and Video Competition Act of 2006, Assembly Bill 2987 (Ch. 700, Stats. 2006), and as that Act may hereafter be amended.

F. “EAS” means Emergency Alert System.

G. “FCC” means the Federal Communications Commission.

H. “OVS” means open video system.

I. “PEG” means public, educational and governmental access.

J. “Public right-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 primarily dedicated to travel, now or hereafter existing within the city which may be properly used for the purpose of installing, constructing, operating, maintaining, and repairing a cable system or a video service provider’s network; and any other property that a state franchisee is entitled by California or federal law to use by virtue of the grant of a state franchise.

K. “Public property” means any property that is owned or under the control of the city that is not located in the public right-of-way, including, for purposes of this chapter, but not limited to, buildings, parks, and pole structures, such as utility poles and light poles, or similar facilities or property owned by or leased to the city.

L. “State franchisee” means any video service provider that has been granted a state franchise by the commission whose video service area includes all or any part of the incorporated limits of the city.

M. “Video service provider” has the meaning set forth in DIVCA and, in addition, refers collectively to any cable operator, video service provider or OVS operator as defined in DIVCA. (Ord. 934 § 1, 2008)

13.06.030 Administration and regulations.

A. The city may from time to time adopt rules and regulations to implement the provisions of this chapter consistent with DIVCA.

B. The cable coordinator is hereby authorized to administer this chapter and to provide or cause to be provided any notices (including noncompliance notices) and to take any action on behalf of the city that may be required under this chapter, DIVCA, or under applicable law.

C. The failure of the city, upon one or more occasions, to exercise a right or to require compliance or performance under this chapter 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 or its exercise by the city is not permitted by DIVCA.

D. The city may designate one or more entities, including itself, to control and manage the use of PEG access channels, and any PEG facilities and equipment owned, controlled or used by the city or the designated entity or entities. (Ord. 934 § 1, 2008)

13.06.040 Construction, operation, maintenance and repair.

A video service provider within the city, in its use of public rights-of-way and public and private property shall to the extent otherwise permitted by law comply with all generally applicable city encroachment and other permitting requirements. (Ord. 934 § 1, 2008)

13.06.050 Franchise fee.

A. Every state franchisee operating within the boundaries of the city shall pay a franchise fee to the city in the amount of five percent of that state franchisee’s gross revenues derived from the operation of its network to provide cable or video services within the city.

B. For purposes of this chapter, “gross revenue” shall have the meaning set forth in California Public Utilities Code Section 5860.

C. A state franchisee shall remit the franchise fee to the city quarterly, within forty-five days after the end of each calendar quarter. Each payment shall be accompanied by a summary explaining the basis for the calculation of the franchise fee.

D. If a state franchisee fails to pay the franchise fee when due, or underpays the proper amount due, the state franchisee shall pay a late payment charge at an annual interest rate equal to the highest prime lending rate during the period of delinquency, plus one percent. (Ord. 934 § 1, 2008)

13.06.060 Public, educational, and government access channel capacity, interconnection, signal carriage and support.

A. PEG Channel Capacity.

1. A state franchisee shall designate and activate three PEG channels on its network. The state franchisee shall designate and activate the three PEG channels within three months from the date that the state franchisee receives a state franchise to provide video service in the city; however, this three month period shall be suspended for such a period, and only for such a period, during which the state franchisee’s ability to designate or provide such PEG capacity is technically infeasible, as provided in California Public Utilities Code Section 5870(a).

2. A state franchisee shall provide an additional PEG channel when the standards set forth in California Public Utilities Code Section 5870(d) are satisfied by the city or any entity designated by the city to be responsible for PEG.

B. PEG Support.

1. Amount of PEG Support Fee. Any state franchise holder operating within the city shall pay to the city’s designated PEG provider a PEG fee of sixty four cents per month per subscriber or an amount equivalent to the level of PEG funding remitted by the incumbent cable operator to the city’s designated PEG provider, if greater or lesser than sixty four cents per month.

2. The PEG support fee shall be used by the city for PEG purposes consistent with state and federal law.

3. A state franchisee shall remit the PEG support fee to the city quarterly, within forty-five days after the end of each calendar quarter. Each payment shall be accompanied by a summary explaining the basis for the calculation of the PEG support fee.

4. If a state franchisee fails to pay the PEG fee when due, or underpays the proper amount due, the state franchisee shall pay a late payment charge at an annual interest rate equal to the highest prime lending rate during the period of delinquency, plus one percent.

C. PEG Carriage and Interconnection.

1. As set forth in Sections 5870(b) and 5870(g)(3) of the California Public Utilities Code, state franchisees 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 franchisee shall be of similar quality and functionality to that offered by commercial channels on the state franchisee’s lowest cost tier of service unless the PEG signal is provided to the state franchisee at a lower quality or with less functionality.

2. As set forth in Section 5870(h) of the California Public Utilities Code, the holder of a state franchise and an incumbent cable operator shall negotiate in good faith to interconnect their networks for the purpose of providing PEG programming. If a state franchisee and an incumbent cable operator cannot reach a mutually acceptable interconnection agreement for PEG carriage, the city shall require the incumbent cable operator to allow the state franchisee to interconnect its network with the incumbent cable operator’s network at a technically feasible point on the state franchisee’s network as identified by the state franchisee. If no technically feasible point of interconnection is available, the state franchisee shall make interconnection available to the PEG channel originator and shall provide the facilities necessary for the interconnection. The cost of any interconnection shall be borne by the state franchisee requesting the interconnection unless otherwise agreed to by the parties. (Ord. 934 § 1, 2008)

13.06.070 Audits and records.

A. Not more than once annually, the city or its designee may examine and audit the business records of a state franchisee to ensure compliance with the franchise fee payment obligations of Section 13.06.050 and the PEG fee payment obligations of Section 13.06.060.

B. A state franchisee shall keep all business records reflecting any gross revenues, even if there is a change in ownership of the state franchisee, for at least four years after such gross revenues are recognized by the state franchisee on its books and records. In the case of subscriber numbers used for calculating the PEG fee, a state franchisee shall keep data on the number of its subscribers in the city, even if there is a change in ownership of the state franchisee, for at least four years after the close of each calendar quarter on which the PEG fee is to be paid.

C. To the extent consistent with DIVCA and other applicable law, the city may request, and a state franchisee shall provide, information and books and records to the extent necessary to monitor a state franchisee’s compliance with this chapter. (Ord. 934 § 1, 2008)

13.06.080 Customer service.

A. A state franchisee shall comply with California Government Code Sections 53055, 53055.1, 53055.2 and 53088.2; the FCC customer service and notice standards set forth in 47 C.F.R. Sections 76.309, 76.1602, 76.1603 and 76.1619; California Penal Code Section 637.5; the privacy standards of 47 U.S.C. Section 551; and 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 subsection shall be interpreted and applied to accommodate newer or different technologies while meeting or exceeding the goals of the standards.

B. The cable coordinator shall monitor the compliance of state franchisees with respect to the state and federal customer service and consumer protection standards set forth in subsection A of this section. The cable coordinator will provide a state franchisee with written notice of any material breaches of applicable customer service or consumer protection standards, and will allow the state franchisee thirty days from the receipt of the notice to remedy the specified material breach. Material breaches not remedied within the thirty day time period will be subject to the following penalties to be imposed by the city:

1. For the first occurrence of a violation, a fine of five hundred dollars shall be imposed for each day the violation remains in effect, not to exceed one thousand five hundred dollars for each violation.

2. For a second violation of the same nature within twelve months, a fine of one thousand dollars shall be imposed for each day the violation remains in effect, not to exceed three thousand dollars for each violation.

3. For a third or further violation of the same nature within twelve months, a fine of two thousand five hundred dollars shall be imposed for each day the violation remains in effect, not to exceed seven thousand five hundred dollars for each violation.

C. A state franchisee may appeal a penalty assessed by the cable coordinator to the city council within thirty days of the initial assessment. The city council shall hear all evidence and relevant testimony and may uphold, modify or vacate the penalty. The city council’s decision on the imposition of a penalty shall be final. (Ord. 934 § 1, 2008)

13.06.090 Encroachment permits—Procedures for appeal of denial.

A. As provided by Section 5885 of the California Public Utilities Code, the city shall either approve or deny an application from a state video service franchise holder for an encroachment permit within sixty days of receiving a completed application.

B. For purposes of this section, an “encroachment permit” means any permit issued by the city relating to construction or operation of facilities relating to the provision of video service under a state video service franchise.

C. An application for an encroachment permit is considered complete when the applicant has complied with all statutory requirements for such an application, including those of the California Environmental Quality Act, Public Resources Code Sections 21000 et seq., and generally applicable ordinances and regulations of the city.

D. Any city denial of an application for an encroachment permit shall be in writing and shall contain a detailed explanation of the reason for the denial.

E. An applicant whose application for an encroachment permit has been denied may appeal the denial in the manner specified in Chapter 2.52 of this code. (Ord. 934 § 1, 2008)

13.06.100 Emergency alert system.

A. A state franchisee shall comply with the Emergency Alert System (EAS) requirements of the FCC in order that emergency messages may be distributed over the state franchisee’s network.

B. A state franchisee’s EAS shall be remotely activated by telephone and shall allow an authorized representative of the city to override the audio and video on all channels on the state franchise’s network that may be lawfully overridden, without the assistance of the state franchisee, for emergency broadcasts from a location designated by the city in the event of a civil emergency or for reasonable tests. Testing of a state franchisee’s EAS shall occur at times that will cause minimal subscriber inconvenience.

C. The city shall permit only appropriately trained and authorized persons to operate the EAS equipment. Except to the extent expressly prohibited by applicable law, the city shall hold the state franchisee, its employees and officers harmless from any claims arising out of the emergency use of its facilities by the city. (Ord. 934 § 1, 2008)

13.06.110 Notices.

All notices and copies of documents that DIVCA requires to be provided to the city, as a local entity or a local franchising entity, shall be addressed to the city manager, attention: cable coordinator. (Ord. 934 § 1, 2008)

13.06.120 Severability.

If any section, sentence, clause or phrase of this chapter is for any reason held to be invalid or unconstitutional by a decision of any court of competent jurisdiction, such decision shall not affect the validity of the remaining portions of this chapter. The city council hereby declares that it would have passed this ordinance and adopted this chapter and each section, sentence, clause or phrase thereof, irrespective of the fact that any one or more sections, subsections, sentences, clauses or phrases be declared invalid or unconstitutional. (Ord. 934 § 1, 2008)

13.06.130 Automatic reauthorization. Revised 3/18

This chapter and the fees established in Sections 13.06.050 and 13.06.060(B) of this code shall automatically be reauthorized upon the expiration and renewal of any existing or future state video franchise certificate held by any state franchisee operating within the city of Capitola pursuant to the terms of Public Utilities Code Section 5870(n). (Ord. 1016 § 3, 2018)