Ordinance 1288
COMCAST OF OREGON II, INC. FRANCHISE
ORDINANCE NO. 1288
AN ORDINANCE GRANTING COMCAST OF OREGON II, INC., A NON-EXCLUSIVE FRANCHISE FOR THE CONSTRUCTION, OPERATION, AND MAINTENANCE OF A CABLE SYSTEM WITHIN THE RIGHT-OF-WAY OF THE CITY AND REPEALING ORDINANCE NO. 1217.
WHEREAS, pursuant to Federal law, state statutes, City Charter, and local ordinances, the City of Junction City (“City”) is authorized to grant a non-exclusive franchise to occupy public rights-of-way; and
WHEREAS, the Federal Cable Act requires a franchise for any cable operator to provide cable telecommunications services; and
WHEREAS, Comcast of Oregon II, Inc., (“Comcast”) is a cable services provider that desires to construct, operate, and maintain a cable system within City rights-of-way; and
WHEREAS, in 2013, by Ordinance No. 1217, the City and Comcast entered into a franchise agreement for construction, operation, and maintenance of a cable system in the City’s right of way, and the agreement term was for ten years; and
WHEREAS, the City and Comcast have negotiated a new franchise agreement with terms agreeable to both parties; and
WHEREAS, the City finds that Comcast has the financial, legal, and technical abilities to provide cable services, facilities, and equipment necessary to meet the future cable-related needs of the community, and has complied with the material terms of its prior franchise; and
WHEREAS, the franchise agreement has been prepared with input from legal counsel, the City, and Comcast, as well as consideration of similar agreements being prepared, negotiated, and executed within neighboring jurisdictions to help ensure consistency in policies and franchise fees; and
WHEREAS, the City Council for the City deems that it is in the public interest to now grant a franchise to Comcast under the terms and conditions with the Franchise Agreement, attached hereto as Exhibit A; now, therefore
THE CITY OF JUNCTION CITY ORDAINS AS FOLLOWS:
Section 1. The foregoing recitals are approved and hereby incorporated into this Ordinance.
Section 2. The Franchise Agreement with Comcast of Oregon II, Inc., attached hereto as Exhibit A, is hereby adopted by the City Council. The Mayor is authorized to execute the agreement on behalf of the Council.
Section 3. Ordinance No. 1217, granting Comcast its prior franchise, is hereby repealed.
Section 4. The City Recorder shall forward the Franchise Agreement to Comcast for acceptance.
Section 5. This Ordinance will go into full force and effect thirty (30) days after approval.
Read in full for its first reading this 14th day of January, 2025.
Read by title only, for its second reading, this 14th day of January, 2025.
Passed by unanimous vote of the Council this 14th day of January, 2025.
Approved by the Mayor this 14th day of January, 2025.
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APPROVED: |
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________________________ |
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Kitty Vodrup, City Recorder |
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Kenneth Wells, Mayor |
Exhibit A to Ordinance 1288
Franchise Agreement between the City of Junction City and Comcast of Oregon II, Inc.
This Franchise Agreement (hereinafter, the "Agreement" or "Franchise Agreement") is made between the City of Junction City, Oregon (hereinafter, "City") and Comcast of Oregon II, Inc. (hereinafter, "Grantee").
The City, having determined that the financial, legal, and technical ability of the Grantee is reasonably sufficient to provide the services, facilities, and equipment necessary to meet the future cable-related needs of the community, desires to enter into this Franchise Agreement with the Grantee for the construction, operation and maintenance of a Cable System on the terms and conditions set forth herein.
SECTION 1 - Definition of Terms
For the purpose of this Franchise Agreement, the following terms, phrases, words, and abbreviations shall have the meanings ascribed to them in the Cable Communications Policy Act of 1984, as amended from time to time, 47 U.S.C. §§ 521 et seq. (the "Cable Act"), unless otherwise defined herein. Words used in this Franchise that are not defined hereunder but are otherwise defined in the Junction City Municipal Code shall have the meaning specified in the Code definition, and it is the intent of the Parties that the definitions provided herein are to be consistent with the definitions under Code and not create any inconsistency in the interpretation or application of the terms of this Agreement.
1.1. "Cable Service" means the one-way transmission of video programming or other programming service to Subscribers, and Subscriber interaction, if any, which is required for the selection or use of such video programming or other programming service.
1.2. “Cable System" shall have the meaning set forth in the Cable Act, and in every case of its use in this Franchise, unless otherwise specified, the term will refer to the cable system constructed or operated by the Grantee in the City under this Franchise.
1.3. “Customer" means a Person or user of the Cable System who lawfully receives Cable Service therefrom with the Grantee's express permission.
1.4. "Effective Date" means the date as defined herein Section 13.10.
1.5. “Facilities" means the cable lines, conduits, and any related equipment, other than customer premises equipment, used by Grantee for provision of Cable Services through its Cable System, in or on the Public Right of Way within the Franchise Area.
1.6. "FCC" means the Federal Communications Commission or successor governmental entity thereto.
1.7 "Franchise" means the initial authorization, or renewal thereof, issued by the Franchising Authority, whether such authorization is designated as a franchise, agreement, permit, license, resolution, contract, certificate, ordinance or otherwise, which authorizes the construction and operation of the Cable System.
1.8. "Franchise Agreement" or "Agreement" shall mean this Agreement and any amendments or modifications hereto.
1.9. "Franchise Area" means the present legal boundaries of the City as of the Effective Date, and shall also include any additions thereto, by annexation or other legal means.
1.10. “Franchising Authority" means the City of Junction City, Oregon, or the lawful successor, transferee, designee, or assignee thereof.
1.11. “Grantee" shall mean Comcast of Oregon II, Inc.
1.12. "Gross Revenue(s)" means all revenue derived by Grantee, or its affiliate(s), from the operation of the Cable System to provide Cable Service to Subscribers within the Franchise Area.
Gross Revenue includes, by way of example and not limitation: fees for Cable Service, regardless whether such service is provided to residential or commercial subscribers, including revenues derived from the provision of all Cable Service; installation, disconnection, reconnection, downgrade, upgrade, maintenance, repair, or similar charges associated with Subscriber Cable Service within the Franchise Area; fees paid to Grantee for channels designated for commercial/leased access use; converter, remote control, and other Cable Service equipment rentals, leases, or sales; payments for pre-paid Cable Service or equipment; advertising revenues; fees, including but not limited to late fees, convenience fees, administrative fees, franchise fees, FCC User Fee, or PEG fees, if applicable; revenue from programming guides; and commissions from home shopping channels and other Cable Service revenue sharing arrangements which will be allocated on a pro rata basis under total Cable Service Subscribers within the Franchise Area. Advertising revenue shall include amounts derived from sales of advertising that are made available to Grantee’s Cable System Subscribers and will be allocated on a pro rata basis using total Cable Service Subscribers reached by the advertising.
Gross Revenue shall not include any taxes on services furnished by Grantee imposed directly on any Subscriber or user by any city, state or other governmental unit and collected by Grantee for such governmental unit, except the Franchise Fee and FCC User Fee will not be regarded as such a tax or fee; bad debt write-offs, except any portion that is subsequently collected and will be allocated on a pro rata basis using Cable Service revenue as a percentage of total Grantee revenues within the Franchise Area; launch fees and marketing co- op fees; unaffiliated third-party advertising sales agency fees or commissions which are reflected as a deduction from revenues; refunds, rebates or discounts made to Subscribers; and sales of capital assets or sales of surplus equipment.
To the extent revenues are derived by Grantee for the provision of a discounted bundle of services which includes Cable Service and non-Cable Services, Grantee shall calculate revenues to be included in Gross Revenue using a methodology that allocates revenue on a pro rata basis when comparing the bundled service price and tis components to the sum of the published rate card prices for such components. Except as required by specific federal, state, or local law, it is expressly understood that equipment may be subject to inclusion in the bundled price at full rate card value. This calculation will be applied to every bundled service package containing Cable Service from which Grantee derives revenues in the Franchise Area. Grantor reserves the right to review and challenge Grantee’s calculations.
The Parties acknowledge that Grantee maintains its books and records in accordance with General Accepted Accounting Principles (“GAAP”). Grantee agrees that it will not utilize GAAP to unlawfully, or in contravention of this Agreement, avoid payment of franchise fees. At all times, Grantor reserves its right to challenge Grantee’s calculation of Gross Revenue, including Grantee’s interpretation of GAAP and Grantee’s interpretation of other directives of the Financial Accounting Standards Board (FASB), the Emerging Issues Task Force (EITF), or U.S. Securities and Exchange Commission (SEC). Grantee agrees to explain and document the source of any change it deems required by FASB, EITF, and SEC concurrently with any Franchise required document at the time of submittal, identifying each Section or line item.
1.13. “Junction City Municipal Code” or “Code” means the lawfully adopted municipal code, and all applicable ordinances, adopted by the City, including all laws that are in effect as of the Effective Date, or otherwise hereafter adopted, and as amended from time to time.
1.14. “Non-Cable Services” means the transmission(s) of telecommunications or information including, but not limited to, voice, video, or data, without regard to the transmission protocol employed, whether or not the transmission facilities are owned by the provider itself, and includes all forms of telephone services and voice, video, data, or information transport, but does not include (1) Cable Service; (2) open video system service, as defined in 47 C.F.R. 76; (3) private communication systems services provide without using the public Right of Way; (4) over-the-air radio or television broadcasting to the public at-large from facilities licensed by the FCC; (5) direct-to-home satellite service within the meaning of Section 602 of the Communications Act; and (6) public communications systems.
1.15. "Person" means any natural person or any association, firm, partnership, joint venture, corporation, or other legally recognized entity, whether for-profit or not-for profit, but shall not mean the Franchising Authority.
1.16. "Public Way" or "Right of Way" shall mean the surface of, and the space above and below, any public street, highway, freeway, bridge, land path, alley, court, boulevard, sidewalk, way, lane, public way, drive, circle or other public right-of-way, including, but not limited to, public utility easements, dedicated utility strips, or rights-of-way dedicated for compatible uses and any temporary or permanent fixtures or improvements located thereon now or hereafter held by the Franchising Authority in the Franchise Area. Public Way shall also mean any easement now or hereafter held by the Franchising Authority within the Franchise Area for the purpose of public travel, or for utility or public service use dedicated for compatible uses, and shall include other easements or rights-of-way as shall within their proper use and meaning entitle the Franchising Authority and the Grantee to the use thereof for the purposes of installing, operating, and maintaining the Grantee's Cable System over poles, wires, cables, conductors, ducts, conduits, vaults, manholes, amplifiers, appliances, attachments, and other property as may be ordinarily necessary and pertinent to the Cable System. However, 'utility easement' does not include any easement dedicated solely for Franchising Authority's facilities or where the proposed use by Grantee is inconsistent with the terms and conditions of any easement granted to the City, unless agreed to in writing by Franchising Authority.
1.17. “Subscriber” means a Person who lawfully received Cable Service provided by Grantee by means of connection to the Cable System, regardless whether a fee is paid for such service.
SECTION 2 - Grant of Authority
2.1. Grant. The Franchising Authority hereby grants to the Grantee under the Cable Act a nonexclusive Franchise authorizing the Grantee to construct and operate a Cable System, to provide Cable Service, in, along, among, upon, across, above, over, or under the Public Way and easements within the Franchise Area, and for that purpose to erect, install, construct, repair, replace, reconstruct, maintain, or retain in, on, over, under, upon, across, or along any Public Way such poles, wires, cables, conductors, ducts, conduits, vaults, manholes, pedestals, amplifiers, appliances, attachments, and other related property or equipment as may be necessary or appurtenant to the Cable System. Prior to construction or alteration within the Public Way, the Grantee will in each case request all required permits, pay applicable fees, and receive approval as necessary before proceeding. Nothing in this Franchise shall be construed to authorize or prohibit Grantee from offering any service over its Cable System that is not prohibited by federal or state law.
2.2. No Implied Rights. No rights will pass from Grantor to Grantee by implication. Without limiting the foregoing, by way of example and not limitation, the Franchise will not include or be substitute for any other permit, agreement, or authorization required under the Code or other generally applicable ordinances and laws of Grantor for the privilege to transact and carry business within the City, to operate on or within the Public Way, including for example, street cut permits, or for occupying any property of the Grantor or private entity to which access is not specifically granted by this Franchise, including without limitation, applicable permits or agreements to place devices on or in poles or wires, conduits, or other structures or railroad easements, whether owned by Grantor or a private entity. This provision should not be interpreted to restrict Grantee’s general franchise rights under 47 U.S.C. Section 541(a). Grantor agrees to use best efforts in its working relationship with Grantee in permitting processes associated with Grantee’s permit requests.
2.3. Reservation of Authority. Nothing in this Franchise Agreement shall (A) abrogate the right of the Franchising Authority to perform any public works or construct, install, maintain, remove, relocate, replace or operate public facilities or improvements of any description; (B) be construed as a waiver of any codes or ordinances of general applicability promulgated by the Franchising Authority, or (C) be construed as a waiver or release of the rights of the Franchising Authority in and to the Public Ways.
The Franchising Authority has jurisdiction and exercises regulatory management over the Public Way whether the Franchising Authority has a fee, easement or other legal interest in the Public Way and whether the legal interest was obtained by grant, dedication, prescription, reservation, condemnation, annexation, foreclosure or other means.
2.4. Term of Franchise. The term of the Franchise granted hereunder shall be ten (10) years, commencing upon the Effective Date of the Franchise, unless the Franchise is renewed or is lawfully revoked in accordance with the terms of this Franchise Agreement and the Cable Act.
2.5. Renewal. Any renewal of this Franchise shall be governed by and comply with the provisions of Section 626 of the Cable Act, as amended.
2.6. Competitive Equity. The Grantee acknowledges and agrees that the Franchising Authority reserves the right to grant additional franchises or other similar lawful authorization to provide Cable Services within the Franchise Area, including but not limited to those franchises already granted or authorized at the Effective Date of this Franchise. Notwithstanding any contrary provision in this Agreement, if any Cable Service Provider enters into any agreement with the City to provide Cable Service in the Franchise Area, the City, within ninety (90) days of the Grantee's written request, shall negotiate with Grantee to amend the Franchise to include any material terms or conditions that the City makes available to a new Cable Services entrant, or provide relief from existing material terms or conditions, so as to insure that the regulatory and financial burdens on each entity are materially equivalent. "Material terms and conditions" include but are not limited to: Franchise Fees; insurance; security instruments; customer service standards; required reports and related record keeping; and notice and opportunity to cure breaches. The Parties agree that this provision shall not require a word for word identical franchise or authorization for a competitive entity, so long as the regulatory and financial burdens on each entity are materially equivalent.
SECTION 3 - Construction and Maintenance of the Cable System
3.1. Permits and General Obligations. The Grantee shall be responsible for obtaining, at its own cost and expense, all permits, licenses, or other forms of approval or authorization necessary to construct, operate, maintain, or repair the Cable System, or any part thereof, prior to the commencement of any such activity. Construction, installation, and maintenance of the Cable System shall be performed in a safe, thorough, and reliable manner using materials of good and durable quality. All transmission and distribution structures, poles, other lines, and equipment installed by the Grantee for use in the Cable System in accordance with the terms and conditions of this Franchise Agreement shall be located so as to minimize the interference with the proper use of the Public Ways and the rights and reasonable convenience of property owners who own property that adjoins any such Public Way.
3.2. Conditions on Street Occupancy.
3.2.1. Non-Interference. The Cable System installed by the Grantee shall be subject to all applicable provisions of the Junction City Municipal Code, and shall be located so as to cause the least possible interference with the proper use of any Public Way and within the rights and reasonable convenience of property owners who own property that adjoins any Public Way.
3.2.2. New Grades or Lines. If the grades or lines of any Public Way within the Franchise Area are lawfully changed or affected (including water and sewer lines) at any time during the term of this Franchise Agreement, then the Grantee shall, upon reasonable advance written notice from the Franchising Authority (which shall not be less than ten (10) business days), and at Grantee’s own cost and expense, protect or promptly alter or relocate the Cable System, or any part thereof, so as to conform with any such new grades or lines.
3.2.3. Relocation at Request of City. Upon written request of the City to protect, support, temporarily disconnect, or relocate any of its equipment, infrastructure, or facilities as may be required to promote the public interest or support public improvements to address traffic conditions, public safety, street vacation, freeway and street construction, change or establishment of street grade, installation of any utility lines or pipes, tracks, or any other type of structures or public improvements by the City or its agents, the Grantee shall, at its sole cost and expense, so relocate its equipment, infrastructure, or facilities. Relocation of facilities shall be completed within a reasonable time limit mutually agreed to by the City and Grantee.
3.2.4. Relocation at Request of Third Party. The Grantee shall, upon reasonable prior written request of any Person holding a permit issued by the Franchising Authority to move any structure, temporarily move its wires or other Facilities to permit the moving of such structure; provided: (i) the Grantee may impose a reasonable charge on any Person for the movement of its wires or other Facilities, and such charge may be required to be paid in advance of the movement of its wires or other Facilities; and (ii) the Grantee is given not less than twenty (20) business days advance written notice to arrange for such temporary relocation.
3.2.5. Restoration of Public Ways. If in connection with the construction, operation, maintenance, or repair of the Cable System, the Grantee disturbs, alters, or damages any Public Way, the Grantee agrees that it shall at its own cost and expense replace and restore any such Public Way to the same or better condition that existed prior to such work.
3.2.6. Safety Requirements and Non-Interference. The Grantee shall, at its own cost and expense, undertake all necessary and appropriate efforts to maintain its work sites in a safe manner in order to prevent failures and accidents that may cause damage, injuries or nuisances. All work undertaken on the Cable System shall be performed in accordance with generally applicable federal, state, and local regulations, including but not limited to the National Electric Safety Code and FCC regulations. The Cable System shall not unreasonably endanger or interfere with the safety of Persons or property in the Franchise Area.
All Grantee's Facilities shall be constructed and maintained in such a manner so as not to interfere with the City's or public's use of the Right of Way or with any public irrigation, sewers, water mains, conduits, sidewalks, paving or other related improvements. If any of the Grantee's Facilities unreasonably interfere with Franchising Authority's use or public's use of such Right of Way, Grantee shall remove such Facilities at Grantee's sole expense and in coordination with the Franchising Authority. If Grantee fails to remove such Facilities after receipt of Franchising Authority's written notice of interference providing a reasonable period of time, Franchising Authority may cause such removal or relocation at Grantee's sole expense.
3.2.7. Trimming of Trees and Shrubbery. The Grantee shall have the authority to trim trees or other natural growth overhanging any of its Cable System in the Franchise Area so as to prevent contact with the Grantee's wires, cables, or other equipment. All such trimming shall be done at the Grantee's sole cost and expense. The Grantee shall be responsible for using generally accepted horticultural standards and for any damage caused by such trimming. Nothing in this subsection shall limit Grantee's right to trim trees or natural growth which pose an immediate safety risk to the public.
3.2.8. Aerial and Underground Construction. Where any transmission or distribution facilities of public or municipal utilities in any area of the Franchise Area are underground, the Grantee shall likewise place its Cable Systems' transmission and distribution facilities underground. In any region(s) of the Franchise Area where the transmission or distribution facilities of utilities are both aerial and underground, the Grantee shall have the discretion to construct, operate, and maintain all of its transmission and distribution facilities, or any part thereof, aerially or underground. Nothing in this Section shall be construed to require the Grantee to construct, operate, or maintain underground any ground- mounted appurtenances such as customer taps, line extenders, system passive devices, amplifiers, power supplies, pedestals, or other related equipment.
3.2.9. Reimbursement of Costs. If funds are available to any utility using the Public Way for the purpose of defraying the cost of any relocation of facilities along or within the Public Way required by the Franchising Authority, Grantee shall be reimbursed in the same manner in which utilities affected by the required relocation are reimbursed, provided, however, the Franchising Authority has sufficient funds designated for reimbursement to Grantee. If funds are controlled by another government entity, the Franchising Authority shall make application for such funds on behalf of Grantee.
SECTION 4 - Service Obligations
4.1. General Service Obligation. The Grantee shall make Cable Service available to every residential dwelling unit within the Franchise Area where the minimum density is at least ten (10) dwelling units per quarter (1/4) cable mile (1320 cable bearing strand feet) and is adjacent to the existing Cable System. Subject to the density requirement, Grantee shall offer Cable Service to all new homes or previously unserved homes located within 125 feet of the Grantee's distribution cable within the Franchise Area at no cost to the Subscriber for the cable extension except for published standard/nonstandard installation charge.
No Subscriber shall be refused services arbitrarily. However, for areas not meeting the above density requirement, Grantee shall only be required to extend the Cable System to Subscribers in the area if the Subscribers are willing to share the capital costs of extending the Cable System. Specifically, the Grantee shall contribute a capital amount equal to the construction cost per mile, multiplied by a fraction whose numerator equals the actual number of residences per 1320 cable-bearing strand feet from Grantee's trunk or distribution cable, and whose denominator equals ten (10). Subscribers who request service shall bear the remaining cost to extend the Cable system on a pro rata basis. The Grantee may require that payment of the capital contribution in aid of construction borne by such potential Subscribers be paid in advance. Subscriber shall also be responsible for any standard/nonstandard installation charges to extend the Cable System from the tap to the residence.
The Grantee may elect to provide Cable Service to areas not meeting the above density and distance standards including the Urban Growth Boundary area directly adjacent and contiguous to the Franchise Area. The Grantee may impose an additional charge in excess of its regular installation charge for any service installation requiring a drop in or line extension in excess of the above standards. Any such additional charge shall be computed on a time plus materials basis to be calculated on that portion of the installation that exceeds the standards set forth above.
4.2. New Developments. The Franchising Authority shall provide the Grantee with written notice of the issuance of building or development permits for planned developments within the Franchise Area requiring undergrounding of cable facilities. The Franchising Authority agrees, to the extent consistent with applicable law, to require that a developer give Grantee at least ten (10) business days’ written notice of the availability of access to open trenches for deployment of cable lines and conduits. The Grantee shall be responsible for engineering and deployment of labor applicable to its cable lines and conduits. If requested to by the Franchising Authority, Grantee shall meet with the necessary parties to coordinate construction in the Rights of Way to minimize public inconvenience, disruption, or damages.
4.3. Programming. The Grantee shall offer to all Customers a diversity of video programming services.
4.4. No Discrimination. Neither the Grantee nor any of its employees, agents, representatives, contractors, subcontractors, or consultants, nor any other Person, shall discriminate or permit discrimination between or among any Persons in the availability of Cable Services provided in connection with the Cable System in the Franchise Area. All Persons may receive all available Cable Services so long as such Person's financial or other obligations to the Grantee are satisfied. Nothing contained herein shall prohibit the Grantee from offering bulk discounts, promotional discounts, package discounts, or other such pricing strategies as part of its business practice.
4.5. Prohibition Against Reselling Service. No Person shall resell any Cable Service, program or signal transmitted over the Cable System by the Grantee.
SECTION 5 - Fees and Charges to Customers
All rates, fees, charges, deposits and associated terms and conditions to be imposed by the Grantee for any Cable Service as of the Effective Date shall be in accordance with applicable FCC's rate regulations. Before any new or modified rate, fee, or charge is imposed, the Grantee shall follow the applicable FCC notice requirements and rules and notify affected Customers, which notice may be by any means permitted under applicable law.
SECTION 6 - Customer Service Standards; Customer Bills; and Privacy Protection
6.1. Customer Service Standards. The Grantee shall comply in all respects with the customer service standards set forth in Part 76 of the FCC’s regulations, as may be amended from time to time.
6.2. Customer Bills. Customer bills shall be designed in such a way as to present the information contained therein clearly and comprehensibly to Customers, and in a way that (A) is not misleading and (B) does not omit material information. Notwithstanding anything to the contrary in Section 6.1 above, the Grantee may, in its sole discretion, consolidate costs on Customer bills as may otherwise be permitted by Section 622(c) of the Cable Act (47 U.S.C. §542(c)).
6.3. Privacy Protection. The Grantee shall comply with all applicable federal and state privacy laws, including Section 631 of the Cable Act (47 U.S.C. §551) and regulations adopted pursuant thereto.
SECTION 7 - Oversight and Regulation by Franchising Authority
7.1. Franchise Fee. The Grantee shall pay to the Franchising Authority a franchise fee in an amount equal to five percent (5%) of annual Gross Revenues; provided, however, that Grantee shall not be compelled to pay any higher percentage of franchise fees than any other cable operator providing service in the Franchise Area. The payment of franchise fees shall be made on a quarterly basis and shall be due and payable forty-five (45) days after the close of each calendar quarter. Each franchise fee payment shall be accompanied by a report prepared by a representative of the Grantee showing the basis for the computation of the Franchise Fees paid during that period. In the event that any
law or valid rule or regulation limits or prevents the Grantor from imposing a franchise fee in the amount provided for herein, Grantee shall pay to Grantor at the times provided for, the maximum permissible amount up to the agreed upon 5% of annual Gross Revenues referenced herein.
7.1.1. To the extent that revenues are derived by Grantee for the provision of a discounted bundle of services which includes Cable Service, as defined herein, and non-Cable Service, Grantee shall calculate revenues to be included in Gross Revenues using a methodology that allocates revenue on a pro rata basis when comparing the bundled service price and tis components to the sum of the published rate for such components at the published standalone retail rate pricing before discounts are applied. Grantee may not allocate discounts for bundled services for the purpose of evading payments of franchise fees to the Franchising Authority.
7.1.2. No acceptance of any payment shall be construed as an accord by Franchising Authority that the amount paid is, in fact, the correct amount, nor shall any acceptance of payments be construed as a release of any claim Franchising Authority may have for further or additional sums payable or for the performance of any other obligations of Grantee.
7.2. Franchise Fees Subject to Audit and Inspection
7.2.1. Upon reasonable prior written notice, the Franchising Authority shall have the right to audit and/or inspect the Grantee's financial records used to calculate the Franchising Authority's franchise fees. However, the Grantee shall only be responsible for paying any amounts discovered to be owed to the Franchising Authority from such audit or inspection if such amounts were paid (or should have been paid) within thirty six (36) months of the Franchising Authority's notice of audit and inspection, after which period any such payment shall be considered final.
7.2.2. Upon the completion of any such audit by the Franchising Authority, the Franchising Authority shall provide to the Grantee a final report setting forth the Franchising Authority's findings in detail, including any and all substantiating documentation. In the event it is determined that franchise fees for the audit or inspection period have been underpaid, the Franchising Authority shall notify Grantee in writing of its determination. Upon receipt, Grantee shall have thirty (30) days to pay the amount due and owing or to notify the Franchising Authority if it disagrees with the Franchising Authority's determination. The Franchising Authority and Grantee shall discuss all disputed amounts. In the event the parties are not able to reach an agreement on mutually acceptable terms and conditions, either party may pursue their legal remedies. The entire reasonable costs of such audit or inspection shall be borne by the Grantee if the review results in an underpayment of five percent (5%) or more for the period under review.
7.3. Oversight of Franchise. In accordance with applicable law, the Franchising Authority shall have the right to oversee, regulate and, on reasonable prior written notice and in the presence of Grantee's employee, periodically inspect the construction, operation and maintenance of the Cable System in the Franchise Area, and all parts thereof, as necessary to monitor Grantee's compliance with the provisions of this Franchise Agreement.
7.4. Technical Standards. The Grantee shall comply with all applicable technical standards of the FCC as published in subpart K of 47 C.F.R. § 76. To the extent those standards are altered, modified, or amended during the term of this Franchise, the Grantee shall comply with such altered, modified or amended standards within a reasonable period after such standards become effective. The Franchising Authority shall have, upon written request, the right to obtain a copy of tests and records required to be performed pursuant to the FCC's rules.
7.5. Maintenance of Books, Records, and Files.
7.5.1. Books and Records. Throughout the term of this Franchise Agreement, the Grantee agrees that the Franchising Authority, upon reasonable prior written notice to the Grantee, may review such of the Grantee's books and records at its business office in Oregon regarding the operation of the Cable System and the provision of Cable Service in the Franchise Area which are reasonably necessary to monitor Grantee's compliance with the provisions of this Franchise Agreement at the Grantee's business office, during normal business hours, and without unreasonably interfering with Grantee's business operations. Such books and records shall include any records related to this Franchise Agreement or required to be kept in a public file by the Grantee pursuant to the rules and regulations of the FCC. All such documents pertaining to financial matters that may be the subject of an inspection by the Franchising Authority shall be retained by the Grantee for a minimum period of three (3) years.
7.5.2. File for Public Inspection. Throughout the term of this Franchise Agreement, the Grantee shall maintain at its business office, in a file available for public inspection during normal business hours, those documents required pursuant to the FCC's rules and regulations.
7.5.3. Proprietary Information. Notwithstanding anything to the contrary set forth in this Section, the Grantee shall not be required to disclose information which is proprietary or confidential in nature. The Franchising Authority agrees to treat any information disclosed by the Grantee as confidential and only to disclose it to those employees, representatives, and agents of the Franchising Authority that have a need to know in order to enforce this Franchise Agreement and who agree to maintain the confidentiality of all such information, subject to Oregon's public records disclosure laws. The Grantee shall not be required to provide Customer information in violation of Section 631 of the Cable Act or any other applicable federal or state privacy law. For purposes of this Section, the terms "proprietary or confidential" include, but are not limited to, information relating to the Cable System design, customer lists, marketing plans, financial information unrelated to the calculation of franchise fees or rates pursuant to FCC rules, or other information that is reasonably shown by the Grantee to be competitively sensitive. In the event that the Franchising Authority receives a request under a state "sunshine," public records or similar law for the disclosure of information the Grantee has designated as confidential, trade secret or proprietary under federal or Oregon law, the Franchising Authority shall notify Grantee of such request and cooperate with Grantee in opposing such request.
SECTION 8 - Transfer or Change of Control of Cable System or Franchise.
Neither the Grantee nor any other Person may transfer the Cable System or the Franchise without the prior written consent of the Franchising Authority, which consent shall not be unreasonably withheld or delayed. No change in control of the Grantee, defined as an acquisition of 50% or greater ownership interest in Grantee, shall take place without the prior written consent of the Franchising Authority, which consent shall not be unreasonably withheld or delayed. No consent shall be required, however, for (i) a transfer in trust, by mortgage, hypothecation, or by assignment of any rights, title, or interest of the Grantee in the Franchise or in the Cable System in order to secure indebtedness, or (ii) a transfer to an entity directly or indirectly owned or controlled by Comcast Corporation. Within thirty (30) days of receiving a request for consent, the Franchising Authority shall, in accordance with FCC rules and regulations, notify the Grantee in writing of the additional information, if any, it requires to determine the legal, financial, and technical qualifications of the transferee or new controlling party. If the Franchising Authority has not taken action on the Grantee's request for consent within one hundred twenty (120) days after receiving such request, consent shall be deemed given.
SECTION 9 - Insurance and Indemnity
9.1. Insurance. Throughout the term of this Franchise Agreement, the Grantee shall, at its own cost and expense, maintain Comprehensive General Liability Insurance and provide the Franchising Authority certificates of insurance designating the Franchising Authority and its officers, boards, commissions, councils, elected officials, agents and employees as additional insureds and demonstrating that the Grantee has obtained the insurance required in this Section. Such policy or policies shall be in the minimum amount of Two Million Dollars ($2,000,000.00) for bodily injury or death to any one person, and Four Million Dollars ($4,000,000.00) for bodily injury or death of any two or more persons resulting from one occurrence, and Two Million Dollars ($2,000,000.00) for property damage resulting from any one accident. Such policy or policies shall be non-cancelable except upon thirty (30) days prior written notice to the Franchising Authority. The Grantee shall provide workers' compensation coverage in accordance with applicable State law. The Grantee shall defend, indemnify, and hold harmless the Franchising Authority from any workers compensation claims to which the Grantee may become subject during the term of this Franchise Agreement.
9.2. Indemnification. The Grantee shall indemnify, defend, and hold harmless the Franchising Authority, its officers, employees, and agents from and against any liability or claims resulting from property damage or bodily injury (including accidental death) that arise out of Grantee's construction, operation, maintenance, or removal of the Cable System within the Franchise Area. Such indemnification shall include, but not be limited to: reasonable attorneys' fees, costs, or expenses. This duty to defend, indemnify and hold harmless shall not extend to any negligence or gross negligence of the Franchising Authority or its officers, employees, and agents. The Franchising Authority shall provide Grantee with prompt written notice to indemnify and defend any such claims. The Franchising Authority may, at its own cost, defend or participate in the defense of a claim.
SECTION 10 - Performance and Construction Bonds
Within sixty (60) days following receipt of written request from Franchising Authority, Grantee shall post a performance bond in the amount of $50,000 as surety for the faithful performance and discharge by Grantee of all obligations imposed by this Franchise Agreement. The performance bond shall remain in force and effect throughout the Term of this Franchise Agreement. If Grantee fails to timely pay an assessment of liquidated damages or franchise fees, the Franchising Authority shall give Grantee twenty (20) business days' notice of its intent to draw the amount owed from the performance bond. The Franchising Authority may not draw from the security bond while any court action appeal or other process has been instituted by Grantee to challenge the amount owed.
SECTION 11 - System Description and Service
11.1. System Capacity. During the term of this Agreement the Grantee's Cable System shall be capable of providing a minimum of eighty-five (85) channels of video programming with satisfactory reception available to its customers in the Franchise Area.
11.2. Service to Governmental and Institutional Facilities. The parties acknowledge that as of the Effective Date of this Franchise agreement, Grantee continues to provide at no cost one (1) Complimentary Basic Video Services and one (1) outlet to certain schools, libraries, and public institutions within the Franchise Area, that are within 125 feet of the Grantee’s distribution cable. For purposes of this subsection, “Basic” shall mean the most basic level of service offered by the Grantee. In the event Grantee elects, to the extent permitted by Applicable Laws, to invoice the Grantor for Complimentary Services, Grantee agrees that it will do so only after providing City and affected agencies with one hundred twenty (120) days’ prior written notice. Grantee agrees not to unfairly or unreasonably discriminate against the Grantor with respect to other Oregon served local franchising authorities, with respect to the costs to be imposed for Complimentary Services. Grantee cannot charge more than the marginal cost if it elects to invoice for Cable Services, which would be the same as those charged to other local franchising authorities in Oregon.
The Grantor shall have the right to discontinue the receipt of all or a portion of the Complimentary Services provided by the Grantee in the event Grantee elects to impose a charge against the Grantor for the Complimentary Services as set forth in the preceding paragraph.
SECTION 12 - Enforcement or Termination of Franchise
12.1. Notice of Violation or Default. In the event the Franchising Authority believes that the Grantee has not complied with the material terms of the Franchise, it shall notify the Grantee in writing with specific details regarding the exact nature of the alleged noncompliance or default.
12.2. Grantee's Right to Cure or Respond. The Grantee shall have forty-five (45) days from the receipt of the Franchising Authority's written notice: (A) to respond to the Franchising Authority, contesting the assertion of noncompliance or default; or (B) to cure such default; or (C) in the event that, by nature of the default, such default cannot be cured within the forty-five (45) day period, initiate reasonable steps, to the Franchising Authority's satisfaction, to remedy such default and notify the Franchising Authority of the steps being taken and the projected date that they will be completed.
12.3 Enforcement. Subject to applicable federal and state law, in the event the Franchising Authority, determines that the Grantee is in default of any provision of the Franchise, the Franchising Authority, after providing the notice and hearing process described below, may:
12.3.1. Revoke this Franchise for violation of any material Franchise provision; or
12.3.2. Seek specific performance of any provision that reasonably lends itself to such remedy as an alternative to damages, or seek other equitable relief; or
12.3.3. Establish and impose a lesser sanction, which may include imposing liquidated damages of not more than five hundred dollars ($500.00) for each offense.
12.4 Default of a Material Breach. In the case of a default of a material provision of the Franchise as described in this Section 12.3, the Franchising Authority may declare the Franchise Agreement to be revoked only after providing the following:
12.4.1 Notice. The Franchising Authority shall give written notice to the Grantee of its intent to revoke the Franchise on the basis of one or more instances of noncompliance with a material provision of the Franchise. The notice shall set forth with specificity the exact nature of the noncompliance. The Grantee shall have ninety (90) days from the receipt of such notice to object in writing and to state its reasons for such objection. In the event the Franchising Authority has not received a response from the Grantee or if the Grantee's response does not propose a satisfactory remedy, the Franchising Authority may then seek to revoke the Franchise at a public hearing. The Franchising Authority shall cause to be served upon the Grantee, at least ten (10) days prior to such public hearing, a written notice specifying the time and place of such hearing and stating its intent to request termination of the Franchise.
12.4.2 Hearing. At the designated hearing, the Franchising Authority shall give the Grantee an opportunity to state its position on the matter, present evidence and question witnesses, after which it shall determine whether or not the Franchise shall be revoked, or some other action taken. The public hearing shall be on the record and written minutes of the Franchising Authority shall be made available to the Grantee within ten (10) business days. The Grantee may, at its cost, make arrangements for a written transcript of the hearing. The decision of the Franchising Authority shall be in writing and shall be delivered to the Grantee by certified mail. The Grantee may appeal such determination to a court of competent jurisdiction. Such appeal to the appropriate court must be taken within sixty (60) days of the issuance of the determination of the Franchising Authority.
12.5. Technical Violation. The Franchising Authority agrees that it is not its intention to subject the Grantee to penalties, fines, forfeitures, or revocation of the Franchise for so-called "technical" breach(es) or violation(s) of the Franchise, which shall include, but not be limited, to the following:
12.5.1. in instances or for matters where a violation or a breach of the Franchise by the Grantee was good faith error that resulted in no or minimal negative impact on the Customers within the Franchise Area; or
12.5.2. where there existed circumstances reasonably beyond the control of the Grantee and which precipitated a violation by the Grantee of the Franchise, or which were deemed to have prevented the Grantee from complying with a term or condition of the Franchise.
12.6 Remedies Not Exclusive. All remedies and penalties under this Franchise, including revocation, are cumulative and the recovery or enforcement of one is not a bar to the recovery or enforcement of another. The Franchising Authority reserves the right to avail itself of any and all remedies available to it under law or equity. Failure to enforce shall not be deemed a waiver of any such right.
SECTION 13 - Miscellaneous Provisions
13.1. Force Majeure. The Grantee shall not be held in default under, or in noncompliance with, the provisions of the Franchise, nor suffer any enforcement or penalty relating to noncompliance or default (including cancellation or revocation of the Franchise), where such noncompliance or alleged defaults occurred or were caused by strike, riot, war, earthquake, flood, tidal wave, unusually severe rain or snow storm, hurricane, tornado or other catastrophic act of nature, labor disputes, failure of utility service necessary to operate the Cable System, governmental, administrative or judicial order or regulation or other event that is reasonably beyond the Grantee's ability to anticipate or control. This provision also covers work delays caused by waiting for utility providers to service or monitor their own utility poles on which the Grantee's cable or equipment is attached, as well as unavailability of materials or qualified labor to perform the work necessary.
13.2. Notice. All notices shall be in writing and shall be sufficiently given and served upon the other party by hand delivery, first class mail, registered or certified, return receipt requested, postage prepaid, or by reputable overnight courier service. General electronic notifications may be used as appropriate All notifications should be addressed as follows:
To the Franchising Authority: City of Junction City
Attention: City Administrator/Recorder
P.O. Box 250 / 185 W. 8th Avenue
Junction City, OR 97448
To the Grantee:
Comcast Cable
Attn: Government Affairs
11308 SW 68th Parkway
Tigard, OR 97223
13.3. Entire Agreement. This Franchise Agreement embodies the entire understanding and agreement of the Franchising Authority and the Grantee with respect to the subject matter hereof and supersedes all prior understandings, agreements, and communications, whether written or oral. All ordinances or parts of ordinances that are in conflict with or otherwise impose obligations different from the provisions of this Franchise Agreement are superseded by this Franchise Agreement.
13.4. Severability. If any section, subsection, sentence, clause, phrase, or other portion of this Franchise Agreement is, for any reason, declared invalid, in whole or in part, by any court, agency, commission, legislative body, or other authority of competent jurisdiction, such portion shall be deemed a separate, distinct, and independent portion. Such declaration shall not affect the validity of the remaining portions hereof, which other portions shall continue in full force and effect.
13.5. Governing Law. This Franchise Agreement shall be deemed to be executed in the State of Oregon, and shall be governed in all respects, including validity, interpretation and effect, and construed in accordance with, the laws of the State of Oregon, as applicable to contracts entered into and performed entirely within the State.
13.6. Modification. No provision of this Franchise Agreement shall be amended or otherwise modified, in whole or in part, except by an instrument, in writing, duly executed by the Franchising Authority and the Grantee.
13.7. No Third-Party Beneficiaries. Nothing in this Franchise Agreement is or was intended to confer third-party beneficiary status on any member of the public to enforce the terms of this Franchise Agreement.
13.8. No Waiver of Rights. Nothing in this Franchise Agreement shall be construed as a waiver of any rights, substantive or procedural, the Grantee and the Franchising Authority may have under federal or state law unless such waiver is expressly stated herein.
13.9. Binding Agreement. This Franchise and the written acceptance by Grantee constitute a binding contract between the Grantee and the Franchising Authority. By accepting the Franchise, Grantee acknowledges and accepts the City's legal right to issue and enforce the Franchise and agrees to comply with the provisions of this Franchise, consistent with applicable law.
13.10. Effective Date. The effective date of this Franchise shall be the date the ordinance adopting this Franchise is made effective.
By executing this Agreement, the undersigned warrant and declare that each has the authority to and consent of their respective entities to execute this Agreement:
City of Junction City, Oregon:
By: ___________________________
Name: ________________________
Title: _________________________
Date: _________________________
Comcast of Oregon II, Inc.:
By: ___________________________
Name: ________________________
Title: _________________________
Date: _________________________