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Ordinance Number 760los ORDINANCE NO. 760 CABLE COMMIMICATIONS SYSTEMS AN ORDINANCE OF THE CITY OF SAN JUAN CAPISTRANO, CALIFORNIA, AMENDING CHAPTER 2, CABLE TELEVISION SYSTEMS OF TITLE 7, PUBLIC WORKS, OF THE SAN JUAN CAPISTRANO MUNICIPAL CODE TO PROVIDE FOR THE GRANTING AND REGULATION OF FRANCHISES FOR CABLE COMMUNICATIONS SYSTEMS THE CITY COUNCIL OF THE CITY OF SAN JUAN CAPISTRANO, CALIFORNIA, DOES HEREBY ORDAIN AS FOLLOWS: SECTION 1. Amendment Text. Chapter 2, Title 7, of the San Juan Capistrano Municipal Code is hereby amended in its entirety to read as follows: TITLE 7, CHAPTER 2 CABLE COMMUNICATIONS FRANCHISE Sec. 7-2.01. Definitions. For the purposes of this ordinance, the following words, terms, phrases, and their derivations shall have the meanings given herein. When not inconsistent with the context, words used in the present tense include the future tense, words in singular number include the plural number. The word "shall" is always mandatory and not merely directory. (a) "Additional Service" means any service not included in "Basic Service" or "Institutional Service." (b) "AAcency Subscriber" means a subscriber who receives a service in a government or public agency, school, or non-profit corporation facility. -1- 206 (c) "Affiliated Person" or "Affiliates" means each Person who falls into one or more of the following categories: (i) each Person having, directly or indirectly, a Controlling Interest in Grantee; (ii) each Person in which Grantee has, directly or indirectly, a Controlling Interest; (iii) each Person, directly or indirectly, controlling, controlled by, or under common Control with Grantee; provided that "Affiliated Person" shall in no event mean the Grantor, any Cable Usage Corporation, or any creditor of Grantee solely by virtue of its status as a creditor and which is not otherwise an Affiliated Person by reason of owning a Controlling Interest in, being owned by, or being under common ownership, common management, or common Control with Grantee. (d) "Administrative Officer" means the City Manager or his/her designee. (e) "AttachmentPoint" means the point at which Grantee's drop attaches to subscriber -owned equipment. (f) "Basic Service" or "Basic Cable Service" or "Basic Service Tier" means the lowest service tier which includes the retransmission of local television broadcast signals. (g) "Broadcast Signal" means a signal transmitted over the air to a wide public geographic audience and received by a cable system. (h) "Cable operator" means any Person or group of Persons (A) who provides Service over a Cable System and directly or through one or more Affiliates owns a significant interest in such cable system, or (B) who otherwise controls or is responsible for, through any arrangement, the management and operation of such a Cable System. (i) "Cable System" or "Cable Communications System" or "System" means a facility, consisting of a set of closed transmission paths and associated signal generation, reception, and control equipment that is -2- 207 designed to provide Service which includes video programming and which is provided to multiple Subscribers within a community, but such term does not include (A) a facility that serves only to retransmit the television signals of 1 or more television broadcast stations; (B) a facility that serves only Subscribers in 1 or more multiple unit dwellings under common ownership, control, or management, unless such facility or facilities uses any public right-of-way; (C) a facility of a common carrier which is subject, in whole or in part, to the provisions of Title II of the Cable Act, except that such facility shall be considered a Cable System (other than for purposes of section 621(c)) to the extent such facility is used in the transmission of video programming directly to subscribers; or (D) any facilities of any electric utility used solely for operating its electric utility systems. (j) "Channel" means a frequency band capable of carrying a standard video signal or some combination of video signals, or a frequency band assigned to carry a non-standard video signal or some combination of such video signals. (k) "Commercial Subscriber" means a subscriber who receives a residential service in a place of business, or anyone whose service is utilized in a business, trade, or profession, including but not limited to hotels, motels, bars, restaurants and other similar establishments. (1) "Cable Usaae Corporation" or "CUC" means a non- profit, public corporation, hereinafter further defined, established or authorized by the Grantor. (m) "Complaint" means a billing dispute or service call in which a subscriber is notifying Grantee of an outage and/or degradation in picture quality. (n) "Control" or "Controlling Interest" means actual working control in whatever manner exercised, including, without limitation, working control through ownership, management, debt instruments, or -3- M negative control, as the case may be, of the System, the Franchise or Grantee. A rebuttable presumption of the existence of Control or a Controlling Interest shall arise from the beneficial ownership, directly or indirectly, by any Person or group of Persons acting in concert (other than underwriters during the period in which they are offering securities to the public) of thirty percent (30%) or more of any Person (which Person or group of Persons is hereinafter referred to as "Controlling Person") or being a party to a management contract. "Control" or "Controlling Interest" as used herein may be held simultaneously by more than one Person or group of Persons. (o) "Converter" or "Terminal" means a device which converts signals from one frequency to another or otherwise processes signals for use by subscribers. (p) "Drop" means the cable and related equipment connecting the system's plant to equipment at the subscriber's premises. (q) "Education Channel" means any channel where non- profit educational institutions are the primary designated programmers. (r) "FCC" or "Commission" means the Federal Communications Commission or its designated representative(s). (s) "Franchise" means a written legal undertaking or action of the Grantor which awards permission to a specific named person or entity to use the streets and public ways for the purpose of installing, operating and maintaining a Cable Television System. (t) "Government Channel" means any channel where local government agencies are the primary designated pro- grammers and programming is non-commercial informational programming regarding government activities and programs. Loy (u) "Grantee" means the entity to which a Franchise is granted for the construction, operation, main- tenance, and reconstruction of a Cable System and the lawful successors, transferees, or assignees of said entity. (v) "Grantor" means the entity establishing this Ordinance for territory within its present and future jurisdiction, its elected governing body, and/or such representative person or entity as it may designate to act on cable matters in its behalf. (w) "Gross Annual Revenue" or "Gross Annual Receipts" or "Gross Receipts" means all revenue, or in-kind consideration (only to the extent that such in-kind consideration exceeds a fair market value to the Grantee of $5,000 for any single transaction or $10,000 annually), as determined in accordance with generally accepted accounting principles, which is received, directly or indirectly, by Grantee and by each Affiliated Person from or in connection with the distribution of any Service on the System, or the provision of any Service related activity in connection with the System. Gross Annual Revenue shall also include all revenue which is received by Grantee or any Affiliated Person from any other Person, including without limitation, leased or access channel programmers, from or in connection with the distribution of any Service over the System or the provision of any Service related activity in connection with the System. Gross Annual Revenue shall also include all advertising revenue which is received by Grantee, from or in connection with the distribution Service over the System or the provision of any Service related activity in connection with the System. Gross Annual Revenue shall not include: (i) the revenue of any Person, including, without limitation, a supplier of programming to Grantee to the extent that said revenue is also included in Gross Annual Revenue of Grantee; (ii) the revenue of Grantee or any other Person which is received directly from the sale of any merchandise through any Service distributed over the System (other than that portion of such revenue which represents or can be attributed to a 060 210 Subscriber fee or a payment for the use of the System for the sale of such merchandise, which portion shall be included in Gross Annual Revenue); (iii) taxes imposed by law on Subscribers which Grantee is obligated to collect; (iv) any investment income earned by Grantee; (v) the revenue of any Affiliated Person which represents standard and reasonable amounts paid by Grantee to said Affiliated Person for ordinary and necessary business expenses of said Affiliated Person Grantee, including without limitation, professional service fees and.insurance subscription fees and advertising receipts, to the extent all of said amounts have in total already been included in Gross Annual Revenue; (vi) advertising commissions deducted by advertising agencies and national, regional or local representation firms, which entities are not the Grantee or an Affiliated Person, before advertising revenues are paid over to Grantee; (vii) advertising commissions deducted for advertising services provided by Affiliated Persons, provided that the percentages of gross revenues paid Affiliated Persons for such advertising commissions do not exceed the percentages of gross revenues paid said Persons as of the Effective Date of any Franchise granted hereunder; (viii) the revenue received by any Affiliated Person or other Persons in connection with the sale to Subscribers of any cable programming guide so long as said cable programming guide is sold in conjunction with other written materials and no special charge is made for said cable programming guide; (ix) the revenue received in any Service related activity which is only remotely connected with the System (e.cr., the revenue received from ticket sales to a concert that is jointly promoted by the System) provided, however, that any fee or revenue directly paid to the Grantee or Affiliated Person for promotion or advertising in relation thereto shall be included in Gross Annual Revenue; and (x) to the extent consistent with generally accepted accounting principles, consistently applied, bad debt write- offs. 10M Z11 (x) "Institutional Network" or "Institutional System" means a system or portion of a system intended pri- marily to service non-residential subscribers. (y) "Lease Channel" means any channel where someone other than Grantor or Grantee is sold the rights -to air programming. (z) "Local Origination Channel" means any channel where the Grantee is the primary designated programmer. (aa) "Monitoring" or "Tapping" means observing or receiving a signal, or the absence of a signal, where the observer is neither the sending nor receiving party and is not authorized by the sending and/or receiving party to observe said signal, whether the signal is observed or received by visual, electronic, or any other means whatsoever. (ab) "Non -Broadcast Signal" means a signal that is not involved in over -the -air broadcast for general pub- lic reception. (ac) "Pay Cable" or "Pay Service," "Premium -Service" or "Pay Television" means signals for which there is a fee or charge to users over and above the charge for Basic Service including any tiers of service; provided, however, the sale or lease of studio facilities, equipment, and/or tapes to local users shall not be deemed pay or premium services. (ad) "Plant" means the transmitting medium and related equipment which transmits signals between the headend and subscribers, including drops. (ae) "PEG Channel" means a Public, Education or Government channel. (af) "Person" means any corporation, partnership, proprietorship, individual or organization authorized to do business in the State of California or any natural person. -7- 212 (ag) "Program" or "Programming" means the information content of a signal and the act or process of cre- ating such content, whether that content is intended to be pictures and sound, sound only, or any other form of information whatsoever. (ah) "Programmer" means any person or entity who or which provides program material or information for transmission by means of a System. (ai) "Progerty of Grantee" means all property owned or leased within the Franchise area by Grantee in the conduct of its system business under a Franchise granted hereunder. (aj) "Public Channel," "Access Channel," "Community Service Channel" or "Community Channel" means any channel for which members of the public or any community organization may provide non -advertiser supported programming; provided, however, sponsorship identification fees may be paid and accepted to further community programming. (ak) "Resident" means any person residing in the franchised area or as otherwise defined by applicable law. (al) "Residential Dwelling Unit" means a home, mobile home, condominium, apartment, co-operative unit and any other individual dwelling unit. (am) "Residential Subscriber" means a subscriber who receives a service in a dwelling unit, and whose service is not utilized in a business, trade or profession. (an) "Section" means any section, subsection, or provision of this Ordinance, or of a Franchise here- under. (ao) "Service" means any kind of service or type of benefit provided or authorized to be provided by Grantee pursuant to the terms of a Franchise, or group of related benefits or abilities, obtained or made available to any person or entity, involving 213 the use of a signal transmitted via a cable communications system, whether the signal and its content are the entire service or comprise only a part of a service which involves other elements of any number or kind. (ap) "Service Area" means the City of San Juan Capistrano. (aq) "Service Outage" means a substantial or complete disruption in cable service to three (3) or more subscribers in a localized area. (ar) "Service Tier" or "Tier" means a category of Service or other Services provided by a Cable Operator and for which a separate rate is charged by the Cable Operator other than per channel or per event programming or legitimate packages of per channel or per event programming. (as) "School" means any educational institution, public or private. (at) "Streets and Public Ways" means the surface and the space above and below any public street, sidewalk, alley, or other public way or right of way of any type whatsoever. (au) "Subscriber" means any person or other entity electing to subscribe to, for any purpose, a service provided by Grantee by means of or in connection with its cable system. (av) "Unit" means a discrete place where system services are used, such as a residence, apartment, office, store, etc. (aw) "User(s)" means any person or entity who either receives services from a cable system or who accomplishes any purpose by, in part or in whole, transmitting or receiving information via a cable system, or who creates programming for that purpose, or who receives and uses programming. 214 (ax) "Year" means a specific year or part of a year referred to, or a full calendar year. (ay) Terms Not Defined - Words, terms, or phrases not defined herein shall first mean their definition in the Cable Communications Policy Act of 1984, as amended, ("Cable Act"), then their special meanings or connotations in any industry, business, trade or profession where they commonly carry such special meanings. In the event such special meanings are not common, they shall mean their standard definitions as set forth in commonly used and accepted dictionaries of the English language. Sec. 7-2.02. Grant of Franchise (a) Authority to Grant Franchises. The Grantor may grant a Franchise to provide a System under and pursuant to this Ordinance. (b) Form. A Franchise may, at Grantor's sole option, take the form of an ordinance, license, permit, contract, agreement, resolution or any other form elected by Grantor. (c) Grants Not Required. Consistent with applicable state and federal law, no provision of this ordi- nance shall require the granting of a Franchise when, in the opinion of the Grantor, it is in the public interest not to do so. (d) Purpose. The purpose of a Franchise shall be to identify and authorize its specific Grantee and to identify and specify those terms, conditions, definitions, itemizations, specifications and other particulars of the agreement between the Grantor and Grantee which it represents. In so doing a Franchise may clarify, extend and interpret the pro- visions of this Ordinance. Where a Franchise and this Ordinance conflict both shall be liberally interpreted to achieve a common meaning or requirement. In the event this is not possible within reasonable limits, the Franchise shall pre- vail. -10- 115 (e) Mutual Consideration. The award of a Franchise authorizing the use of public property or public rights for private purposes shall be deemed consideration by the Grantee in the form of agreement to provide the system and services offered in accordance with the provisions hereof and of the Franchise. (f) Compliance with Law. Neither this Ordinance nor a Franchise granted under it relieves Grantee of any requirement of Grantor or of any ordinance, rule, regulation, or specification of Grantor now or hereafter in effect, including, but not limited to, the payment of all normal permit and inspection fees so long as said ordinance, rules, regulations or specifications do not materially conflict with or alter the express terms of this Ordinance and the Franchise. (g) Franchise Non -Exclusive. Grantor may, at its option, grant one or more Fran- chises to construct, operate, maintain, and reconstruct a System. Said Franchises shall consti- tute both a privilege and an obligation to provide the system and services required by this Ordinance and the Franchise Agreement. (h) Limitation. No privilege shall be granted or con- ferred by a franchise except those specifically prescribed herein or in the Franchise Agreement. (i) Duration. The term of any Franchise, and all rights, privileges, obligations and restrictions pertaining thereto shall be specified in the franchise agreement. The effective date of any franchise shall be as specified in the Franchise. (j) Use of Public Streets and Ways. For the purposes of operating and maintaining a System in the franchised area, a Grantee may place and maintain within the public rights of way such property and equipment as are necessary and appurtenant to the operation of the System. Prior to construction or alteration of plant in public rights of way, the Grantee shall apply for, pay all applicable fees, and receive all necessary permits. -11- rest (k) Use of Other Utilities. Any person or entity who provides a system or services as defined herein shall be deemed a Grantee and shall not do so except in accordance with a franchise granted hereunder. If such Grantee uses distribution channels furnished by a telephone company or other public utility, said Grantee shall be required to comply with all of the provisicns hereof as a "Licensee," and the term "Grantee" herein shall include "Licensee" in its meaning. Sec. 7-2.03. Rights Reserved to the Grantor. (a) Reservation. There is hereby reserved to Grantor every right it may have in relation to its power of eminent domain over Grantor's Franchise and property. (b) Non -waiver or Bar. Neither the granting of any franchise, nor any provisions hereof, shall constitute a waiver or bar to the exercise of any governmental right or power by Grantor. (c) Delegation of Powers. Any right or power in, or duty retained by or imposed upon Grantor, or any commission, officer, employee, department, or board of Grantor, may be assigned or transferred by Grantor to any officer, employee, department or board of Grantor. (d) Right of Inspection of Construction. The Grantor shall have the right to inspect all construction or installation or other physical work performed by Grantee in connection with the Franchise, and to make such tests as it shall find necessary to ensure compliance with the terms of the Franchise and other pertinent provisions of law, so long as said inspection and testing does not unreasonably interfere with Grantee's operations. (e) Riaht to Require Removal of Property. Consistent with applicable law, at the expiration of the term or any renewal term or extension for which the Franchise is granted, or upon its lawful revocation, expiration, or termination, the Grantor shall have the right to require the Grantee to remove, at Grantee's expense, all portions of its System and -12- any other property—from all streets and public ways within the Franchise area within a reasonable period of time. (f) Right of Intervention. The Grantor shall have the right of intervention in any suit, proceeding or other judicial or administrative proceeding in which the Grantor has any material interest, to which the Grantee is party. (g) Place of Inspection. The Grantor shall have the right to inspect and request copies of all relevant information that is reasonably necessary for the exercise of Grantor's regulatory authority upon reasonable notice on Grantee's local premises at any time during normal business hours, and any Grantee records kept at another place shall, within ten (10) days of Grantor's request, be made available at Grantee's premises within the County of Orange for Grantor's inspection and or copying, so long as said inspection does not unreasonably interfere with Grantee's operations. Grantor shall pay all reasonable costs for copying any relevant information needed. Sec. 7-2.04. Rights of Subscribers. (a) Discriminatory Practices Prohibited. The Grantee shall not deny Service or otherwise discriminate against Subscribers, or others on the basis of race, color, religion, national origin, sex, age or sexual preference. The Grantee shall strictly adhere to the equal employment opportunity requirements of federal, state or local governments and shall comply with all applicable laws and executive and administrative orders relating to non-dis- crimination. (b) Tapping and Monitoring. The Grantee shall not tap or monitor or permit any other person controlled by Grantee to tap or monitor any cable, line, signal input device or subscriber outlet or receiver for any purpose whatsoever without the express written consent of the subscriber or a court order therefor; provided, however, that the Grantee shall be entitled to monitor customer service calls for quality control purposes and to conduct system -wide -13- 218 or individually addressed "sweeps" for the purpose of verifying system integrity, controlling return path transmission, or checking for unauthorized connections to the cable television system or service levels or billing for pay services. (c) Data Collection. (1) Except for its own use or in connection with the provision of Services or for release to the Grantor to the extent permitted by law, the Grantee shall not permit its system to be used for data collection purposes, nor shall it otherwise collect data which would reveal the commercial product or other preferences or opinions of individual subscribers, members of their families, or their guests, licensees or employees, except for Grantee's own internal uses, unless the Grantee shall have received the prior affirmative written consent of such subscriber. (2) In any event, the Grantee shall not reveal or permit the release or sale of data on individual subscribers but may reveal or permit the release or sale of aggregate data only. (d) Revealing Subscriber Preferences. (1) Grantee shall not reveal individual subscriber preferences, viewing habits, beliefs, philoso- phy, creeds or religious beliefs to any third person, firm, agency, governmental unit or investigating agency without court authority or prior written consent of the subscriber. (2) Such written consent, if given, shall be limi- ted to a period of time not to exceed one (1) year or a term agreed upon by the Grantee and subscriber. (3) The Grantee shall not condition the delivery or receipt of cable services to any subscriber on any such consent. =KIM 219 (4) Such a subscriber may revoke without penalty or cost any consent previously made by delivering to the Grantee in writing a substantial indication of his intent to so revoke. (e) Revealing Subscriber Lists. The Grantee shall not reveal, or sell, or permit the release or sale>of its subscriber list without the prior affirmative written consent of each Subscriber, provided that Grantee may use its subscriber list as necessary for the construction, marketing, and maintenance of the Grantee's services and facilities authorized by a Franchise, and the concomitant billing of subscribers for said Services; and further, provided that consistent with applicable law, Grantor may use Grantee's subscribers list for the purpose of communication with subscribers in connection with matters relating to operation, management, and maintenance of the Cable System. (f) Other Persons Affected. The prohibitions contained in Sections 7-2.04 (a) - (i) shall extend and apply to all of the foregoing as well as to the Grantee: (1) Officers, directors, employees and agents of the Grantee; (2) General and Limited Partners of the Grantee; (3) Any person or combination of persons owning holding or controlling five percent (51) or more of any corporate stock or other ownership interest of the Grantee; (4) Any affiliated or subsidiary entity owned or controlled by Grantee, or in which any officer, director, stockholder, general or limited partner or person or group of persons owning, holding or controlling any ownership interest in the Grantee, shall own, hold or control five percent (51) or more of any corporate stock or other ownership interest; and (5) Any person, firm or corporation acting or serving in the capacity of holding or controlling company of the Grantee. -15- 220 (g) Subscriber Bill of Rights. Grantee shall provide, at the time of initial connection and annually thereafter to all subscribers a publication, in a form prior approved by Grantor, delineating and describing, in clear and understandable language, the consumer rights granted herein. (h) Notice to New Subscribers. Before providing cable television service to any subscriber, Grantee shall provide a written notice to the Subscriber covering substantially the following information: Customer. understands that Company uses telephone and power company facilities and public rights of way in providing service and that this continued use cannot be guaranteed. Customer agrees not to make any claim against Company or the telephone company, or power company, or counties and/or incorporated cities of the franchise area or their officers and/or employees in the event that such use is denied for any reason and Company is unable, in its discretion, to provide service over alternate routes. (i) Complaint Advice. Grantor may require that Grantee advise each subscriber as may be set forth in the Franchise that the Grantor's representative is the official to whom complaints of poor service should be made if such complaints of poor service are not resolved by Grantee to the satisfaction of each Subscriber. (a) Public age of the System. To the extent specified in the Franchise, the Grantor may utilize a portion of the cable system capacity, and associated facilities and resources, to develop and provide non-commercial cable services that will be in the public interest. In furtherance of this purpose, the Grantor may establish a non-profit or cooperative corporation, and adopt by-laws, to receive and allocate facilities, support funds and other considerations provided by the Grantee, and/or others. Such a public corporation, if established, may be delegated the following responsibilities: -16- 221 (1) Receive, and utilize or reallocate for util- ization, channel capacity, facilities, funding and other support provided specifically for public non-commercial usage of the cable system. (2) Review the status and progress of each non- commercial service developed for public benefit. (3) Report to the Grantor annually on the utiliza- tion of resources, the new public services developed and the benefits achieved for the Grantor and its residents. (4) Reallocate resources on a periodic basis to conform with changing priorities and public needs. (b) Grantee Snort for Local Cable System Usage. Grantee shall provide to the Grantor or the Cable Usage Corporation, at Grantor's election, equipment, facilities, and channel capacity as provided in the Franchise. Sec. 7-2.06. Services. (a) Services to be Provided. A Cable System shall provide, as a minimum, the broad programming categories listed in the Franchise. (b) Changes in Services. Grantee shall inform Grantor, at least forty-five (45) days and Subscribers at least thirty (30) days in advance of making any change in a Cable Service or in the rates charged therefor, unless Grantor agrees to waive this requirement in writing. (c) Non-discrimination. Grantee shall not discriminate between or among subscribers within one type or class in the availability of services at either standard or differential rates according to published rate schedules. No charges may be made for services except as listed in published schedules which are available to inspection by anyone at Grantee's office, quoted by Grantee on the telephone, and displayed or communicated to all potential subscribers. -17- 222 (d) Prepayment. Upon completion of system construction and/or system reconstruction, Grantee may, at its option, charge subscribers for services no more than one (1) month in advance unless an individual subscriber requests a longer period. Prior to completion of system reconstruction, Grantee may continue any existing advance billing practices which provide for up to a maximum of two (2) months of advance billing. Bills may be due and payable upon mailing but shall not be delinquent, and no late charge penalties shall be assessed, until the later of: (1) thirty (30) days from postmark; or (2) service has actually been provided for the billed period. All bills and billing statements shall clearly indicate the billing period, the actual due date, and the delinquent or late remedy or assessment. (e) Disconnect for Cause. Grantee may disconnect a subscriber only for cause, which shall include, without limitation, the following: (1) Payment delinquency in excess of forty-five (45) days. (2) Willful or negligent damage to or misappropri- ation of Grantee property. (3) Monitoring, tapping, or tampering with Gran- tee's system, signals, or service. (4) Threats of violence to Grantee's employees or property. (f) Reconnection. Grantee shall, upon subscriber's written request, reconnect service which has been disconnected for payment delinquency when payment has removed the delinquency. If authorized by applicable law, a published standard charge may be made for reconnection. Grantee shall not be required to make more than three (3) reconnections for the same subscriber if the disconnections involved were caused by payment delinquency within the past twenty-four (24) months. Reconnection for disconnects covered by sections 7-2.06 (e) (2) shall be at Grantee's sole discretion. LLS (1) Grantee shall promptly provide and maintain service to the residential, commercial, and industrial structures as provided in the Franchise Agreement, in the service area as defined in the Franchise Agreement, upon request of the lawful occupant or owner. (2) In the case of a new drop, Grantee shall advise each subscriber that he/she has the right to require his/her installation be done over any route on his property, and in any manner he/she may elect which is technically feasible and consistent with proper construction practices. Grantee may, if he/she so elects, require that any such request be made in writing. If the subscriber requests installation other than a standard installation, then the subscriber may be required to pay a reasonable fee for the time and materials occasioned by the installation and to sign an agreement releasing Grantee from liability for poor service or damage to person or property resulting from the non-standard installation. (3) For purposes of this subsection, a standard installation shall include installation of drop cable with fittings up to one hundred and fifty feet (150) feet from the CATV distribution system measured along the cable from the center line of the street or utility easement through the house wall or at the customer's option through the floor from a house vent or crawl space directly to the customer's television set with five feet of cable from the wall or floor entry to the TV set. Also included as part of a standard installation is the grounding cable, fine tuning of the television set and the provision of the appropriate literature. (h) Converters/Terminals. At such time as a converter or terminal becomes necessary for subscribers to have access to all services on its system, Grantee shall make them available to subscribers. Grantee may require each subscriber who elects to take a converter or terminal to furnish a security deposit therefor. -19- zz4 (1) Each device shall be and remain the property of the Grantee unless Grantor approves its sale to the subscriber. Grantee shall be responsible for maintenance and repair of all equipment owned by Grantee and may replace it as he/she may from time -to -time elect, except that subscriber shall be responsible for loss of or damage to any such device while in his/her possession. (2) Upon termination or cancellation of sub- scriber's service, subscriber shall promptly return Grantee's property to Grantee in the same condition as received, reasonable wear and tear excepted. (3) Grantee may apply the security deposit against any sum due from subscriber for loss of or damage to such converter exceeding reasonable wear and tear. In the event that no security deposit has been required, the Grantee may charge the subscriber for any such damage exceeding reasonable wear and tear. (4) If Grantee has no claim against the deposit, Grantee shall return it, or the balance, to the subscriber within forty-five (45) days of return of the converter. (i) Non -Standard Installations. For each non-standard drop installed, the Grantee may charge the subscriber for the cost of material and labor in excess of that for a standard drop. Grantee shall provide each subscriber a written estimate of all charges prior to installation and obtain subscriber's written authorization in advance for all non-standard drop charges. (a) System Construction. The System shall be con- structed in accordance with the provisions of the Franchise agreement. (b) Construction Components and Techniques. Construc- tion components and techniques shall be in accordance with the Franchise and all applicable law. 1"it 225 (c) Technical and Performance Standards. Consistent with applicable law, system technical and performance standards shall be in accordance with the Franchise. (d) Construction Codes. The Grantee shall strictly adhere to all building and zoning codes currently or hereafter in force and obtain all necessary permits: The Grantee shall arrange its lines, cables, and other appurtenances, on both public and private property, in such a manner as to cause no unreasonable interference with the use of said property by any person. In the event of such interference, the Grantor may require the removal of the Grantee's lines, cables, and appurtenances from the property in question. Grantee shall give at least forty-eight (48) hour advance notice to all property owners and the Grantor prior to installing any above -ground and underground structures upon easements located on private property. Grantor shall not modify its construction requirements subsequent to the completion of construction so as to require reconstruction or retrofit unless the public health and safety so requires. (e) System Construction Schedule. (1) The Grantee shall begin to offer Service no later than the schedule contained in the Fran- chise. (2) The Grantee shall provide a detailed construc- tion plan indicating progress schedule, area construction or reconstruction maps, test plan, and projected dates for offering service. (f) Geographical Coverage. The Grantee shall construct the Cable System to service those residential structures within the Service Area of the Franchise and any annexations thereto, as defined and provided by the Franchise, with any exceptions requiring specific Grantor approval. Service shall be provided to subscribers in accordance with the schedules specified in the Franchise. The route of separate cables serving institutional subscribers shall be as approved by Grantor and specified in the Franchise. -21- 226 (g) Provision of Service. After service has been established for any area, the Grantee shall provide service to any requesting residential subscriber within that area within times and terms set forth in the Franchise. (h) Construction Default. Upon the failure, refusal or neglect of Grantee to cause any construction', repair, or other necessary work to comply with the terms of the Franchise agreement to be properly completed in, on, over, or under any right of way within a time prescribed in the Franchise Agreement or the construction permit, Grantor may (but shall not be required to) cause such work to be completed in whole or in part, and upon so doing shall submit to Grantee itemized statement of costs thereof. Grantee shall be given reasonable notice of Grantor's intent to exercise this power and fifteen (15) days to cure thereafter. Grantee shall, within thirty (30) days of billing, pay to Grantor the actual costs thereof. (i) Vacation or Abandonment. In the event any street, alley, public highway or portion thereof used by the Grantee shall be vacated by the Grantor, or the use thereof discontinued by the Grantee, upon reasonable notice, the Grantee shall forthwith remove its facilities therefrom unless specifically permitted to continue the same, and on the removal thereof restore, repair or reconstruct the area where such removal has occurred, to such condition as may be required by the Grantor not in excess of the original condition. In the event of failure, neglect or refusal of the Grantee, after thirty (30) days' notice by the Grantor to do such work, Grantor may cause it to be done, and the cost thereof shall be paid by the Grantee within thirty (30) days and collection may be made by Grantor. (j) Abandonment in Place. Grantor may, upon written application by Grantee, approve the abandonment of any property in place by Grantee, under such terms and conditions as Grantor may approve. Upon Grantor -approved abandonment of any property in place, Grantee shall cause to be executed, acknowledged, and delivered to Grantor such instruments as Grantor shall prescribe and approve, transferring and conveying the ownership of such property to Grantor. -22- 227 (k) Removal of System Facilities. In the event that Grantee's plant is deactivated for a continuous period of thirty (30) days except for reasons outside Grantee's control, without prior written notice to and approval by Grantor then Grantee shall, at Grantor's option, and at the expense of Grantee and at no expense to Grantor, and upon demand of Grantor, promptly remove from any streets or other area all property of Grantee, and Grantee shall promptly restore the street or other area from which such property has been removed to its condition prior to Grantee's use thereof, provided that Grantee shall not be required to remove conduit from underground, where Grantor may determine no damage to the surface of any structures may result from such non -removal. (1) Movement of Facilities. In the event it is nec- essary to temporarily move or remove any of the Grantee's property at Grantor's direction for a public purpose in order lawfully to move a large object, vehicle, building or other structure, Grantee, upon reasonable notice, shall move, at the expense of Grantee, its property as may be required to facilitate such movements. No such movement shall be deemed a taking of Grantee's property. Nothing herein shall limit the right of Grantee to seek reimbursement from any party other than Grantor. (m) Undergrounding of Cable. Cables shall be installed underground at Grantee's cost where all existing utilities are already underground. Previously installed aerial cable shall be installed underground at Grantee's pro rata cost in concert with other utilities when all such other utilities may convert from aerial to underground construction. (n) Facility Agreements. No franchise shall relieve Grantee of any obligations involved in obtaining pole or conduit space from any department of Grantor, utility company, or from others maintaining utilities in streets. (o) Extension of Franchise Area. If Grantor elects to grant one or more franchise hereunder, and if thereafter one or more of the franchises expires or is otherwise ended, Grantor may, if it so elects, require a remaining Grantee, or more than one, to -23- M extend its system to provide service to the area served by the ended franchise unless Grantee demonstrates to Grantor's reasonable satisfaction that it is not commercially practicable to do so, provided, however, Grantee shall not be required to overbuild any existing system. The terms and requirements of such extension shall not exceed those contained herein or in Grantee's Franchise. (p) Repair of Streets and Public Ways. Any and all streets and public ways disturbed or damaged by the Grantee or its contractors, during the construction, operation, maintenance, or reconstruction of the System, shall be restored within the timeframe and limits specified by Grantor or agent of Grantor, at Grantee's expense, to their original condition unless otherwise authorized in writing by Grantor. (q) Erection of Poles Prohibited. The Grantee shall not erect any pole on or along any street or public way in an existing aerial utility system. If additional poles in an existing aerial route are required, Grantee shall negotiate with public utility for their installation. Any such installation shall require the advance written approval of the Grantor. Subject to applicable federal and state law, the Grantee shall negotiate the lease of pole space and facilities from the existing pole owners for all aerial construction, under mutually acceptable terms and conditions. (r) Trimminq of Trees. Grantee may cut or trim any trees in any street and Grantee may cut or trim trees pursuant to a prior agreement with the owner of property on which they stand, or as otherwise authorized in writing by Grantor. (s) Reservations of Street Rights. Nothing in a Fran- chise shall prevent the Grantor from constructing, repairing and/or altering any public work. All such work shall be done, insofar as practicable, in such manner as not to unnecessarily obstruct, injure or prevent the free use and operation of any property of Grantee. However, if any such property of Grantee shall interfere with the construction, maintenance or repair of any public improvement, all such property shall be removed or replaced in such manner as directed by Grantor so that the same shall not interfere with the said public work, and such -24- 229 removal or replacement shall be at the expense of the Grantee. (t) Underground Vaults its Cable System, Gran active, Grant below ground in waterproof in above ground vaults or dimensions, and placement by the Grantor in writing. shall instal passive, or o flush -mounted pedestals whose have been prior Sec. 7-2.08. Operations and Maintenance. (a) Maintenance and Complaints. 1 all of therwise, vaults or design, approved (1) The Grantee shall maintain an office in the Service Area, or such other location approved by the Grantor in writing, open during all usual business hours, but in no case less than forty eight (48) hours per week including at least one weekend day per week. Grantor shall have a publicly listed non -toll -charge telephone number, and operated as to receive subscriber complaints and requests on a 24-hour basis. Current information shall be maintained of all complaints and their disposition and a summary thereof shall be submitted to Grantor upon request but no more often than monthly. (2) The Grantee hours after relating to (48) hours complaints permitted by made to the repair exc service call shall respond receipt of re a service outag excluding Sunda and requests fo preemptive law, Subscriber for ept that Grantee s not related to within eight (8) quest for repairs e and forty-eight ys for all other r repair. Unless no charge shall be such a service or may charge for its Cable System. (3) Telephone Service. The Grantee shall provide a telephone system to receive all construction and service complaints. A sufficient number of customer service representatives shall be provided so that callers are not required to wait beyond thirty (30) seconds for phone service or receive busy signals more than three (3) percent of the time averaged quarterly. The telephone number of the local office shall be listed in the telephone directory serving the City of San Juan Capistrano. The telephone -25- 230 service shall accept complaints twenty-four (24) hours a day, seven (7) days a week. The telephone system shall be capable of self - generating reports relating to answer times, response times, hold times, and abandoned calls. (4) Grantee shall provide and guarantee subscribers with the option of scheduling a four (4) hour period in which the service call will be made either in morning or afternoon. (b) procedures for Handling of Complaints. Grantee's complaint handling procedures shall be designed to accomplish the following: (1) Receipt and acknowledgement of any complaint made in person or by telephone within twelve (12) business hours. (2) Acknowledgement of any complaint received by mail at Grantee's office within five (5) business days of the date such complaint is received. (3) Maintain information available to Grantor, consistent with applicable laws, upon Grantor's request, of all complaints, including the complainants' name, address and telephone number, the date of its acknowledgement, and information given as to how the complaint would be resolved, and the action taken. (4) Provide complete information to the complainant regarding his ability to take his complaint to the Grantor's representative if it is not resolved by the Grantee. (5) Grantee shall respond within eight (8) business hours to complaints made or referred by Grantor. (c) Remedies for Inadeauate Performance. The following remedies for loss of service are hereby established: (1) Except for rebuild or planned Service Outages for which Grantee receives prior approval of Grantor, in the event that one-third or more of -26- 231 its service(s) to any Subscriber is interrupted for six (6) consecutive hours, or for a total of twelve (12) nonconsecutive hours within any thirty (30) day period, and Subscriber notifies Grantee of said outage within twenty-four (24) hours of Subscriber discovery thereof, Grantee shall provide a ten percent (10%) rebate of the monthly fees to affected Subscribers for each such Service Outage period. (2) Except for rebuild or planned Service Outages for which Grantee receives prior approval of Grantor, in the event that one-third or more of its service(s) to any Subscriber is interrupted for twenty-four (24) or more consecutive hours, except in circumstances for which the prior approval of the interruption is obtained from the Grantor, and Subscriber notifies Grantee of said outage within twenty-four (24) hours of Subscriber discovery thereof, Grantee shall provide a twenty percent (200) rebate of the monthly fees to affected Subscribers for each such Service Outage period. (d) Triennial Audit of Performance. (1) In addition to the provisions of section 7-2.12(c) and, except as provided in the Franchise, Grantor may require, at its option, that performance audits of the system be conducted every three (3) years by an independent technical consultant, selected and employed by Grantor and at Grantor's sole expense, to verify compliance of the system to all technical standards and other specifications of the franchise, as provided in the Franchise Agreement. Periodic technical specification testing, if provided for in the Franchise and actually conducted pursuant thereto, shall eliminate this performance audit. (2) Upon completion of a performance audit, the Grantor and Grantee shall meet to review the performance of the Cable System. The reports required herein regarding subscriber complaints, the records of performance tests and the opinion survey report shall be utilized as the basis for review. In addition, any subscriber may submit complaints during the -27- 232 review meetings, either orally or in writing, and these shall be considered. (3) within thirty (30) days after the conclusion of the system performance review meetings, Grantor shall issue findings with respect to the adequacy of system performance and quality of service. If inadequacies are found, Grantor may direct Grantee to correct the inadequacies within a reasonable period of time. (4) Grantor's and Grantee's participation in this process shall not waive any rights they may possess under applicable federal and/or state law. (5) In addition to the Triennial Audit described above, Grantor may conduct an annual audit of the same magnitude, at its sole expense, when and if determined necessary or appropriate by Grantor. (e) System Technical Data. Grantee shall maintain in its office a complete and up-to-date set of as - built system maps and drawings upon completion of construction or reconstruction, equipment spe- cification and maintenance publications, and signal level diagrams for each active electronic piece of equipment in the system. As -built drawings show all lines and installed equipment, and tap values and spigots. The scale of maps and drawings shall be sufficient to show the required details in easily readable form and size. Technical data at the office shall also include approved pole applications, details and documentation of satellite and microwave equipment, mobile radio units, heavy construction vehicles and equipment, and video and audio equipment normally used in the operation of the system. If Grantor requires use of technical data in its own office it may make copies of any items at Grantor's expense. (f) Availability of Technical Data. All technical data shall be available to Grantor's inspection during normal business hours, upon reasonable notice, and, in the event of system failure or other operating emergency, at any time, so long as the provision of said data does not unreasonably interfere with Grantee's operations. 233 (g) Emergency Repair Canability. It shall be Grantee's responsibility to assure that its personnel qualified to make repairs are available at all reasonable times and that they are supplied with keys, equipment location instructions, and technical information necessary to begin repairs upon notification of need to maintain or restore continuous service to the system. (h) Customer Service Standards and Procedures. (1) information to Customers. The Grantee shall, at the time service is initiated, provide each new customer written information covering: (A) The time allowed to pay outstanding bills. (B) Grounds for termination of service. (C) The steps the Grantee must take before terminating service. (D) How the customer can resolve billing disputes. (E) The steps necessary to have service reconnected after involuntary termination. (F) The fact that customer service personnel shall identify themselves by first names immediately. (G) The fact that customers shall have the right to speak with a supervisor, and if none is available, supervisor shall return customer call within one (1) working day. (H) The appropriate regulatory authority with whom to register a complaint and how to contact such authority. In addition, at least once each calendar year, Grantee shall notify each customer that information is available upon request concerning items (A) through (H) above. (i) Written Notices. Written notices of all terms of customer agreement, of all equipment and fee options, of name, address and telephone number of company, availability of parental control devices, company practices with respect to privacy of -29- PW11 customer, and other relevant information shall be made by Grantee to customers before service is begun, at least once each calendar year and at any time upon the request of the customer. Disclosure should include but not be limited to: availability of A/B switches, as may be required by law, any reduced rates for seniors or other subscribers, company billing and credit practices, the telephone numbers for customer complaints of the company and the Grantor, company practices regarding protection of customer privacy. Notices should be sent to the Grantor of current policies and practices at least once a year and whenever changes are made. (j) Advanced Notices. Except as provided in applicable law, advance notices of changes, including increases in fees or charges and in channel lineup of stations or services, shall be sent to Grantor and to subscribers promptly, that is, at least thirty (30) days to Grantor and thirty (30) days to subscribers before the changes are made, except for changes not known sufficiently in advance by Grantee and not under Grantee's control or where Grantor's waiver is obtained. Notices should be clearly identified and in print large enough to be easily readable. (k) Billina. 7-2.06(d) (1) Except as provided in Section/ bills for service shall be rendered monthly, unless otherwise authorized by the customer and the Grantee or unless service is rendered for a period less than one (1) month. All bills shall contain a telephone number and a mailing address for billing inquiries or disputes and shall clearly delineate all changes and the basis for those changes. (2) Disputed Bills (a) In the event of a dispute between the customer and the Grantee regarding the bill, the Grantee shall promptly make such investigation as is required by the particular case and report the results to the customer. In the event the dispute is not resolved to the satisfaction of both parties, the Grantee shall inform the -30- 235 customer of the complaint procedures of the Grantee. If the customer wishes to obtain the benefits of paragraphs (b) and (c) of this sub -section, notification of the disputed bill must be given to the Grantee in writing within thirty (30) days after the bill date. (b) The customer shall not be required to pay the disputed portion of the bill until the earlier of the following: (1) Resolution of the dispute, (2) Expiration of the forty-five (45) day period beginning on the date of issuance, provided that the procedures established in sub -section (a) above have been followed. (c) Pending resolution of the bill dispute, Grantee shall exercise reasonable care to ensure that no termination notices shall be issued for the disputed portions of the bill, nor shall any other collection procedures be initiated for said amount. Any such activity may be interpreted as an attempt to avoid the provisions of these rules and shall constitute violation of the regulations. (1) Referral of Accounts to Collection Agencies. (1) Uncollected accounts may be referred to private collection agencies for appropriate action if the bill has not been paid by the earlier of (a) thirty (30) days following date of involuntary termination or (b) the sixty-first (61st) day following the date of issuance of the original uncollected amount, provided no notification of billing dispute has been made, or if procedures for resolution of billing disputes have not been followed as required above. (2) If the account was voluntarily terminated, for any reason, the account may not be referred to a private collection agency until at least thirty (30) days following rendering of the -31- 236 final bill. If notification of a billing dispute is made, all collection procedures shall be delayed as required in paragraph (c) of sub -section B.3., "Disputed Bills". Referral to collection agent shall then occur no sooner than the sixty-first (61st) day following issuance of the original uncollected amount. (m) Termination for Non -Payment. Bills shall not be delinquent earlier than thirty (30) days from the date of the bill, which must be mailed to subscribers within five (5) working days of its dated date. Subscribers must be notified in writing of a proposed disconnection for non-payment at least fifteen (15) days prior to disconnection. Grantee may not assess late charges of any amount earlier than the thirtieth (30th) day from the date of the bill. (n) Refund. when a subscriber voluntarily discontinues service Grantee shall refund the unused portion of any advance payments after deducting any charges currently due through the end of the present billing period within forty-five (45) days of discontinuance of service. Unused payment portions shall be the percentage of time for which subscriber has paid for service and will not receive it because of his discontinuation of service. (o) nuali y of Service. The quality of Grantee's service refers to the services associated with day- to-day operations (e.g., response to customer complaints; billing; interruptions of service; disconnection; rebates and credits; signal quality, and the provision to customers or potential customers of information on billing or services). In order to assess the quality of service, Grantee shall survey, at Grantor's request, a representative telephonic sample of no less than two hundred (200) subscribers at least once every third calendar year. The form, content, and methodology of the telephonic survey shall be prior approved in writing by Grantor. MIM 237 The results of said survey, including the raw data - and conclusions, shall be provided to Grantor within thirty (30) days of completion and tabulation of results. Sec. 7-2.09. Violations. (a) Use of Public Streets. From and after the effec- tive date of this ordinance, it shall be unlawful for any person to construct, install,_ or maintain in any public place within Grantor's territory, or upon any easement owned or controlled by a public utility, or within any other public property of Grantor, or within any privately -owned area within Grantor's jurisdiction which is not yet, but is designated as, a proposed public place on a tentative subdivision map approved by Grantor, any equipment, facilities, or system for distributing signals or services through a cable television system, unless a franchise has first been obtained hereunder, and is in full force and effect. (b) Unauthorized Connections. It shall be unlawful for any person to make or use any unauthorized connection to, or to monitor, tap, receive or send any signal or service via a franchised system, or to enable anyone to receive or use any service, television or radio signal, picture, program, or sound, or any other signal without payment to the owner of said system. (c) Tampering with Facilities. It shall be unlawful, without the consent of the owner, to willfully attach to, tamper with, modify, remove or injure any physical part of a franchised cable television system. Sec. 7-2.10. Termination and Receivership. (a) Revocation. Consistent with applicable law, in addition to any rights set out elsewhere in this document, the Grantor reserves the right to revoke a Franchise, subject to notice to Grantee and the provision of a hearing consistent with due process requirements, in the event that: -33- 238 (1) The Grantee willfully and/or negligently on a continuous basis violates any material provision of its franchise. (2) The Grantee's construction schedule is mater- ially delayed as set forth in the Franchise and such delays were within the control of Grantee. (b) Forfeiture. Consistent with applicable law, upon failure of the Grantee to comply with the material terms of its franchise, the Grantor may by resolution after a full hearing affording Grantee due process, declare a forfeiture, and the Grantee may be required to forthwith remove its structures or property from the streets and restore the streets to their prior condition within a reasonable period of time and upon failure to do so the Grantor may perform the work and collect all actual costs, including all direct and indirect costs, thereof from the Grantee. The cost thereof shall be a lien upon all plant,.property, or other assets of the Grantee, within the City limits. Sec. 7-2.11. Franchise Applications. (a) Franchise Applications. Applicants for a Franchise, or renewal thereof, may submit to the Grantor, or to a designated agency, written application in a format provided by the Grantor, at the time and place designated by the Grantor for accepting applications, and including the desig- nated application fee. This provision is deemed procedural and shall not constitute the grant of any right to the Grantee. Sec. 7-2.12. Records. (a) Records. There shall be kept in the Grantor's offices a separate record for the Franchise, which record shall show the things hereafter set forth in Subparagraphs A and B below. The Grantee shall provide such information in such form as may be required by the Grantor for said records, as well as copies of any records of Grantee upon request for good cause, so long as the provision of said documents does not unreasonably interfere with Grantee's operations and said information is reasonably necessary for Grantor to carry out its regulatory functions. -34- 239 (1) Any amount collected annually from the Grantor and the character and extent of the service rendered therefor to the Grantor. (2) The amount collected annually from other users of service and the character and extent of the service rendered therefor to them. Grantee shall keep true and accurate books and records in conformity with generally accepted accounting principles, consistently applied, showing all income, expenses, and expense transfers, borrowing, payments, investments of capital, and all other transactions relating to the system. Grantor shall, upon reasonable notice, have the right to inspect said records and receive copies thereof to the extent said information is reasonably necessary for Grantor to carry out its regulatory functions. (b) Reports of Financial and Operating Activity. (1) No later than ninety (90) days after the close of Grantee's fiscal years, Grantee shall present an audited written report to the Grantor which shall include: (a) A financial report verified by the Chief Financial Officer or his/her designee of Grantee for all Cable System activity during the previous fiscal year including gross receipts from all sources, and gross subscriber revenues from each service. (b) A summary of the previous year's activ- ities, including, but not limited to, subscriber totals and new services. (c) If requested by Grantor, a summary of complaints received and remedial actions taken. (c) Performance Tests and Compliance Renorts. No later than April 15 0£ each year, the Grantee shall pro- vide a written report of any FCC or other performance tests required or conducted. In addition, the Grantee shall provide reports of the Test and Compliance procedures established by its franchise agreement, or herein, no later than thirty (30) days after the completion of tests. -35- L4U (d) Additional Reports. The Grantee shall prepare and furnish to the Grantor in writing at the times and in the form prescribed by Grantor, such additional reports with respect to its operation, affairs, transactions, or property, as may be reasonably necessary and appropriate to the performance of any of the rights, functions or duties of the Grantor, as specified by Grantor, and for good cause so long as the provision of said reports does not unreasonably interfere with Grantee's operations and said information is reasonably necessary for Grantor to carry out its regulatory functions. (e) Communications with Regulatory Agencies. Upon Grantor's request copies of all communications between the Grantee and the Federal Communications Commission or any other agency having jurisdiction in respect to any matters affecting cable communications operations authorized pursuant to a franchise, shall be submitted promptly to the Grantor upon receipt or mailing by Grantee. (f) Right to Audit. Grantor shall have the right to inspect, examine, or audit, during normal business hours and upon reasonable notice to the Grantee, all documents which pertain to the Grantee or any Affiliated Person with respect to the system, each Service distributed over the System and each service related activity and which are necessary to the Grantor's performance of its obligations and/or the Grantor's enforcement of its rights under the terms of the Franchise; provided, however, that the Grantor may not exercise said right more frequently than once in any twelve (12) month period. All such documents shall be made available at the local system office of the Grantee. All such documents which pertain to financial matters which may be the subject of an audit by the Grantor shall be retained by the Grantee for a minimum of five (5) years following termination of any Franchise. Access by the Grantor to any of the documents covered by this Section shall not be denied by the Grantee on grounds that such documents are alleged by the Grantee to contain proprietary information. To the extent allowed by applicable law, Grantor shall maintain the confidentiality of said documents. -36- 241 Grantor may require written certification by the Grantee's appropriate directors, officers or other employees with respect to all documents referred to in this Section. Any audit conducted by the Grantor pursuant to this Section shall be conducted at the sole expense of the Grantor and the Grantor shall prepare a written report containing its findings, a copy of which shall be mailed to the Grantee; provided, however, that the Grantee shall reimburse the Grantor for the expense of any such audit if, as the result of said audit, it is determined that there is a shortfall of more than five percent (5°s) in the amount of franchise fees or other payments which have been made or will be made, by the Grantee to the Grantor pursuant to the terms of any Franchise. Sec. 7-2.13. Enforcement Mechanism. (a) Notice of Franchise Default. Except as provided in the Franchise Agreement, prior to formal con- sideration by Grantor of termination of Grantee's Franchise because of willful or continuous negligent failure to correct a default attributed to Grantee, Grantor shall make written demand on Grantee to correct the default alleged. Grantor and Grantee shall expeditiously meet to discuss the alleged problem, at which time Grantee shall indicate, in writing, the amount of time necessary to resolve the alleged problem. During this time period, but in no event fewer than ten (10) days before the final date for correction, Grantee may request additional time to correct the problem and Grantor shall grant said request if it determines, in the exercise of its discretion, that such time is necessary due to delays beyond Grantee's control. If the default continues for a period of thirty (30) days following such deadline for corrections, plus any extension thereof, Franchise termination may be placed on the next available regular Grantor's meeting agenda. The Grantee shall be served a written notice of such termination at least ten (10) days in advance giving the time and place of the Grantor's meeting. At its meeting Grantor shall hear Grantee and any person interested in the matter and shall determine, at that or subsequent meetings, an appropriate course of action for enforcement or termination of Grantee's Franchise. -37- 242 (b) Delegation of Enforcement Mechanisms. Such liquidated damages as Grantor may assess against Grantee which do not include loss of Franchise may, at Grantor's option, be determined by an officer or agency of the Grantor to which it may delegate such administrative considerations and decisions subject to due process and the criteria contained in this ordinance the Franchise agreement subject to appeal to the City Council. Sec. 7-2.14. Miscellaneous Provisions. (a) Captions. The section and subsection numbers and captions throughout this ordinance are intended to facilitate reading and reference. Such numbers and captions shall not affect the meaning or interpretation of any part of this ordinance. (b) Franchise References. A franchise which cites, refers to, or otherwise incorporates this entire ordinance or portions thereof shall be deemed to be a franchise issued under and subject to this ordinance. Such a franchise may employ, as sufficient for citation, reference, or incorporation the section or subsection number and caption hereof, followed by a statement of the detail specification, or requirement of the franchise pursuant to such reference. (c) Filing. When not otherwise prescribed herein, all matters herein required to be filed with Grantor shall be filed with the Grantor's official or agency as designated by Grantor. (d) Non -enforcement by the Grantor. A Grantee shall not be relieved of its obligation to comply with any of the provisions of this ordinance, or of its franchise or any law or regulation, by reason of any failure of the Grantor to force prompt compliance. (e) Continuity of Service. It shall be the right of all subscribers to receive all available services within the obligations of the Franchise insofar as their financial and other obligations to the Grantee are honored. In the event that the Grantee elects to rebuild, modify, or sell the system, the Grantee shall use due diligence and reasonable care to ensure that all subscribers receive continuous, 243 uninterrupted service. In the event of purchase by the Grantor, or a change of Grantee, the current Grantee shall cooperate with the Grantor or new Grantee to operate the system for a temporary period, to maintain continuity of service to all subscribers. In the event that Grantee, through its own fault, discontinues system -wide service for seventy-two (72) continuous hours and Grantee is --,in material default of its Franchise or said Franchise is revoked by Grantor, but not if Grantor fails to renew said Franchise, Grantor may, by resolution when it deems reasonable cause exists, assume operation of a system for the purpose of maintaining continuity of service until any circumstances which may, in the judgment of the Grantor, threaten the continuity of service are resolved to Grantor's satisfaction. (f) Operation By Grantor. During any period when the system is being operated by Grantor pursuant to Section 7-2.08 Grantor shall attempt to cause as little disruption of operations as is consistent with the maintenance of continuing service to subscribers. Notwithstanding the foregoing, Grantor shall, as it may deem necessary, make any changes in any aspect of operations desirable, in Grantor's sole judgment, for the preservation of quality of service and its continuity. Grantor shall further, during any such period, maintain to the best of its ability the system's records, physical plant, financial integrity and funds, and other details and activities normally involved in operations. (g) Management By Grantor. Grantor may, upon assuming operation of a system franchised hereunder, appoint a manager to act for it in the overall as well as detailed direction and conduct of the system's affairs. Such manager shall have the authority delegated to him by Grantor and shall be solely responsible to Grantor for management of the system. Grantee shall reimburse Grantor for all its reasonable costs or damages in excess of system revenues during Grantor operation if the Franchise is in full force and effect during the period of Grantor operation. (h) Notices. All notices and other communications to Grantee shall be addressed to it at the address at -39- 244 which Grantee conducts its business. All notices and other communications to Grantor shall be addressed to it at its published address for receipt of public communications. (i) Force Majeure: Grantee's Inability to Perform. In the event Grantee's performance of any of the terms, conditions, obligations, or requirements of this ordinance or any franchise granted hereunder, is prevented or impaired due to any cause beyond its reasonable control and not reasonably foreseeable, such inability to perform shall be deemed to be excused, and no penalties or sanctions shall be imposed as a result thereof. Such causes beyond Grantee's reasonable control and not reasonably foreseeable shall include, but not be limited to, any acts of God, civil emergencies, labor unrest, strikes, inability to obtain gratis access to an individual's property, and any inability of the Grantee to secure all necessary permissions or permits to utilize necessary poles or conduits so long as Grantee utilizes due diligence to timely obtain said permissions or permits. (j) Application. All of the provisions of this Ordinance, or any of the provisions hereof, shall be applicable to all Franchises granted by the Grantor to the maximum extent permitted by law. (k) Preemption by State or Federal Law. If any State or Federal law or regulation shall require the Grantee to provide any service, or shall permit the Grantee to provide any service, in conflict with the terms and conditions of this Ordinance or of the Grantee's Franchise, then such State or Federal law or regulation shall immediately apply to the terms and conditions of this Ordinance and Grantee's Franchise and shall completely supersede such previous terms and conditions which are in conflict. (1) Severability. If any provision of this Ordinance is determined to be void or invalid by any administrative or judicial tribunal, said provision shall be deemed severable and such invalidation shall not invalidate the entirety of this Ordinance or any other provision thereof. SECTION 2. Effective Date. This Ordinance shall take effect and be in force thirty (30) days after its passage. SECTION 3. City Clerk's Certification. The City Clerk shall certify to the adoption of this Ordinance and cause the same to be posted at the duly designated posting places within the City and published once within fifteen (15) days after passage and adoption as required by law; or, in the alternative, the City Clerk may cause to be published a summary of this Ordinance and a certified copy of the text of this Ordinance shall be posted in the Office of the City Clerk five (5) days prior to the date of adoption of this Ordinance; and, within fifteen (15) days after adoption, the City Clerk shall cause to be published the aforementioned summary and shall post a certified copy of this Ordinance, together with the vote for and against the same, in the Office of the City Clerk. PASSED, APPROVED AND ADOPTED this 21st day of February '1995. ATTEST: CHERYL JOSOii, CITY CLERK MAYOR -41- 245 246 STATE OF CALIFORNIA ) COUNTY OF ORANGE ) SS. CITY OF SAN JUAN CAPISTRANO ) I, CHERYL JOHNSON, City Clerk of the City of San Juan Capistrano, California, DO HEREBY CERTIFY that the foregoing is a true and correct copy of Ordinance No. 760 which was introduced at a meeting of the City Council of the City of San Juan Capistrano, California, held on February 7th 1995, and adopted at a meeting held on February 21st 1995, by the following vote: AYES: Council Members Jones, Hart, Campbell, Swerdlin and Mayor Nash NOES: None ABSTAIN: None ABSENT: None -42- _VII 7=11 Low, ..h,