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Ordinance Number 327431 ORDINANCE NO. 327 CABLE TELEVISION SYSTEMS AN ORDINANCE OF THE CITY OF SAN JUAN CAPISTRANO, CALIFORNIA, ESTABLISHING RULES AND REGULATIONS FOR CABLE TELEVISION SYSTEMS THE CITY COUNCIL OF THE CITY OF SAN JUAN CAPISTRANO DOES ORDAIN AS FOLLOWS: Sections: 1. Definitions 2. Franchise to install and operate 3. Designated service area 4. Cable television service 5. Use of utility poles and facilities 6. Location of property of grantee 7. Changes required by public improvements 8. Failure to perform street work 9. Franchise payments 10. Franchise terms: duration, renewal, renegotiation, and termination 11. Application for franchise 12. Bonds: Indemnifications, insurance 13. Acceptance of franchise 14. Limitations of franchise; includes transfer conditions 15. Rights reserved to City 16. Council to adopt rules and regulations 17. Permits and construction 18. Miscellaneous provisions 19. Removal and abandonment of property of grantee 20. Effect of annexations 21. Equal opportunity employment and affirmative action plan 22. Violations 23. Severability 24. Effective date 25. Clerk's Certification SECTION 1. Definitions For the purposes of this Ordinance and the franchises issued pursuant to it, the following terms, phrases, words, abbreviations, and their derivations shall have the meaning herein. (A) "Cable Television System" or "CATV System" or "CATV", for the purpose of this Ordinance means and includes any facility that, in whole or in part, receives directly, or indirectly over the air, and amplifies or otherwise modifies the signals transmitting programs broadcast by one or more television or radio stations and distributes such signals by wire or cable to subscribing members of the public who pay for such service, but such term shall not include (1) any such facility that serves fewer than 50 subscribers, or (2) any such facility that serves only the residents of one or more apartment dwellings under common ownership, control, or management, and commercial establishments located on the premises of such an apartment house. Any modified definition of a cable television system approved by the Federal Communications Commission (hereinafter "FCC") subsequent to the adoption of this Ordinance shall immediately apply to all the terms and conditions of this Ordinance and shall completely supersede all previous definitions for the purpose of interpreting this Ordinance. -1- 452 (B) "City" shall mean the City of San Juan Capistrano, a municipal corporation of the State of California, in its present incorporated form or in any later reorganized, consolidated, enlarged or re -incorporated form. (C) "Council" shall mean the present governing body of the City of San Juan Capistrano or any future board constituting the legislative body of the City. (D) "Chief Administrative officer" shall mean the City Manager, City Administrator, or other designation of the City's Chief Executive Officer, or any designee thereof. (E) "Person" shall mean any natural person and all domestic and foreign corporations, associations, syndicates, joint stock corporations, partnerships of every kind, clubs, business or common law trusts, and societies. (F) "Grantee" shall mean the person, firm or corporation granted a franchise by the Council under this Ordinance, and the lawful successor, transferee or assignee of said person, firm or corporation. (G) "Street" shall mean the surface, the air space above the surface and the area below the surface of any public street, or other public right-of-way or public place, including public utility easements. (H) "Property of Grantee" shall mean all property owned, installed, or used within the City by a Grantee in the conduct of a cable television system business under the authority of a franchise granted pursuant to this Ordinance. (I) "Subscriber" or "User" shall mean any person or entity receiving for any purpose any service of the Grantee's cable television system including, but not limited to, the conventional cable television system service of transmission of television broadcast, radio signals, original cablecasting, and the local government, education and public access channels; and other services, such as leasing of channels, data and facsimile transmission, pay television, and police, fire and similar public service communications. (J) "Gross Annual Receipts" shall mean any and all compensation received directly or indirectly by the Grantee including: installation fees; disconnect and reconnect fees; rental fees (including but not limited to deposits accepted by Grantee); fees for the transmission of broadcast signals and access and origination channels, if any; per -program or per -channel charges; leased channel revenues; or any other income derived from the system. Gross Revenue shall exclude all sales taxes and excise taxes payable by the Grantee to Federal, State or County governments as a direct result of operations under this Ordinance. Refunds and deposits shall be deducted from current gross revenues upon return. (K) "Gross Annual Subscriber Receipts" shall mean only those revenues derived by the Grantee from the supplying of regular subscription service and shall include: installation fees; disconnect and reconnect fees; rental fees (including but not limited to deposits accepted by Grantee); and fees for the transmission of broadcast signals and access and origination channels, if any. Gross Annual Subscriber Receipts shall not include revenues derived from per -program or per -channel charges, leased channel revenues or other income derived from the system. It shall exclude all sales taxes and excise taxes payable by Grantee to Federal, State or County governments as direct result of operations under this division. Refunds and deposits shall be deducted from current Gross Subscriber Revenues upon return. -2- 453 (L) "Gross Annual Advertising Receipts" shall mean any income, compensation and other consideration received by Grantee derived from any form of advertising. (M) "Gross Annual Lease Receipts" shall mean any fees or income received by Grantee for the lease or rental, and compensation for any service in connection therewith, such as studio and equipment rental and production costs, of any channel permitted or designated by the Federal Communications Commission to be so leased or rented. (N) "Cable TV Board" shall mean a body of persons acting under Council authority as established in this Ordinance. SECTION 2. Franchise To Install and (A) A non-exclusive franchise to install, construct, operate, and maintain a cable television system on streets within all or a specific portion of the City may be granted by the Council to any person, whether operating under an existing franchise, who or which offers to furnish and provide such system under and pursuant to the terms and provisions of this Ordinance. (B) When and in the event that the Grantee of any franchise granted hereunder uses in his cable television system distribution channels furnished to the Grantee by a telephone company pursuant to tariff or contract on file with a regulatory body having jurisdiction and said Grantee makes no use of the streets independent of such telephone company furnished facilities, said Grantee shall be required to comply with all of the provisions hereof as a "Licensee" and in such event whenever the term "Grantee" is used herein it shall be deemed to mean and include "Licensee." SECTION 3. Designated Service Area (A) The franchises granted by the City pursuant to this Ordinance are non-exclusive and authorize the Grantee to construct, operate and maintain a CATV system only within the discreet area of San Juan Capistrano particularly described in the franchises. Additions or deletions to the designated ser- vice area will be made only upon the prior authorization of the City Council, such authorization to be based on a technical performance sheet, a copy of which will be attached to the franchise as Exhibit "A." (B) The Grantee is required to construct, operate and maintain a CATV within the entire designated service area as provided herein unless the City Council approves, as part of the franchise, a policy of construction which requires less than the complete wiring of the designated service area and provided that such policy shall be adopted only after a full public proceeding which includes specific notice of the consideration of such a policy. No provisions construed as to require opinion of the Council grant it or to restrict SECTION 4 of this Ordinance may be deemed or the granting of a franchise when in the it is in the public interest to decline to the number of grantees. Cable Television Service (A) Prohibitions. Grantee shall not perform, nor cause to be performed, any of the following acts without first obtaining City Council approval: -3- 454 (1) Add, delete, or change received channels; (2) Add, delete, or change distributed channels or channel conversion; (3) Change the location of the headend or antenna site; (4) Change location of center for origination of programs and installation of bi-directional facilities or additional lines to make connections to headend; (5) Interconnect with other cable systems; (6) Add new ancillary services; (7) Change subscriber billing practices; (8) Grantee shall not relocate its office without first notifying the City of San Juan Capistrano. This provision shall not apply in any instance where the Grantee provides the City with an order of the Federal Communications Commission requiring that the change be made except that Grantee must then give the City thirty (30) days advance notice. (B) Basic Service. The cable television system permitted to be installed and operated hereunder shall: (1) Be operationally capable of relaying to subscriber terminals those television and radio broadcast signals for the carriage of which the Grantee is now or hereafter authorized by the Federal Communications Commission; (2) Be constructed with the potential of two- way digital signal transmission; (3) Distribute color television signals which it receives in color; (4) Provide as a minimum, the local access channel capacity now and hereinafter required by the Federal Communications Commission for systems operation in the top 100 markets. This shall not be less than one VHF channel for composite use, including use by local government, educational institutions, and the public; (5) Have a minimum capacity of 20 channels; (6) Include all necessary equipment and operational capacity for the emergency transmission of audio and video signals from the headend over all channels simultaneously; however, the City shall provide the diode switchings and access equipment. (C) Non -Basic Services. The cable television system permitted to be installed and operated hereunder, may also engage in the business of: (1) Transmitting original cablecast programming not received through television broadcast signals; -4- 455 (2) Transmitting television pictures, film and videotape programs, not received through broadcast television signals, whether or not encoded or processed to permit reception by only selected receivers or subscribers; (3) Transmitting and receiving all other signals; digital, voice and audio-visual. (D) Municipal Service. (1) With respect to the local access channel, the Grantee shall provide, at the request of the Chief Administrative Officer, use of Grantee's studio, equipment and technical services for production of live and video-tape municipal programs, subject to scheduling requirements of the Grantee. (2) With respect to the basic television services, the Grantee shall provide all subscriber services and a tie-in connection without cost, when the system passes such facilities and as designated by Council, to (i) public schools and community colleges within the City, and (ii) buildings owned and controlled by the the City or County used for public purposes and not for residential use. (E) Extension of Services. It is the desire of the City that cable television service be available to all residents of the City, insofar as economically and technically possible. The franchise granted under this Ordinance shall clearly delineate, on a map of the franchise area, the City streets served by the cable and those not served, indicating scheduled dates when cable will be installed in unserved areas, and specifying penalties for failure to comply with completion dates. (F) Investigation And Resolution Of Complaints. In addition to other service regulations adopted by the Council, the following shall apply: (1) The Grantee shall maintain a local office which is no farther from San Juan Capistrano than is the current office and which shall be open during all normal business hours, with toll-free telephone listed in the directories of the telephone company serving the City, and shall be so operated that complaints and requests for repairs may be received at any time of the day or night, seven (7) days a week. All complaints and inquiries will be investigated and acted upon as promptly as practical, but in no event longer than twenty-four (24) hours after receipt and/or after next normal shift_ (2) The following procedures shall be adopted by the Grantee and the City for investigation and resolution of complaints: -5- 456 (i) Grantee shall maintain a written record or log of all complaints received from indivudual subscribers, other than complaints regarding substantial system failure. The log shall show the date and time of the complaint and the name and address of the complainant, and shall describe the nature of the complaint and the action taken to resolve the complaint. (ii) Grantee shall maintain a separate written record of substantial system failures, showing the date and time of such failure, describing the nature of the failure and recording when and what action was taken to resolve the failure. (iii) Such records shall show the disposition of the complaints or substantial system failure and shall be maintained by the Grantee for a period of three (3) years from the date of notice to the Grantee of the subscriber complaint or of the substantial system failure. A copy of any specific subscriber complaint shall be submitted by Grantee to the City within two (2) days following receipt of a written request by the City official designated to handle complaints. The Grantee's records of complaints and substantial system failures shall be open to inspection by the City during normal working hours. (3) The Grantee shall provide notice of the procedures for reporting and resolving complaints to each subscriber at the time of initial subscription to the cable system and to each current subscriber on an annual basis. (4) In the event of substantial system failure or individual subscriber complaints where the signal quality fails to meet the technical standards established by the Federal Communications Commission (except when caused by circumstances outside of the Grantee's control, such as fire, earthquake, riot, power failure and other similar circumstances), the Grantee shall credit or refund to the affected subscribers an amount equal to one day's service charges for each day of such system or signal failure in excess of forty-eight (48) consecutive hours beginning from the time such failure is reported to the Grantee. Restoration of service in cases of circumstance out of the Grantee's control must be completed as soon as possible. (G) Compatibility. It is the desire of the City that all cable television systems franchised hereunder shall, insofar as financially and technically possible, be compatible one with another and with systems adjacent to the City. -6- 457 (H) Uses Permitted. Any franchise granted pursuant to the provisions of this Ordinance shall authorize and permit the Grantee to engage in the business of operating and providing a cable television system in the City, and for that purpose to install, construct, repair, replace, reconstruct, maintain and retain in, on, under, upon, across, and along any street, such wires, cable, conductors, ducts, conduits, vaults, manholes, amplifiers, and appliances, attachments, and other property as may be necessary and appurtenant to the cable television system; and, in addition, so to use, operate, and provide similar facilities or properties rented or leased from other persons, firms or corporations, including but not limited to any public utility or other person franchised or permitted to do business in the City. SECTION 5. Use of Utility Poles and Facilities (A) When any portion of Grantee's CATV system is to be installed on utility poles and facilities within public property or right-of-way, a copy of the agreement for the use of poles and facilities shall be filed with the Director of Public Works. (B) Where the system is to be installed overhead on existing utility facilities, no additional poles shall be installed either by the Grantee or by the utility for the specific purpose of supporting or extending the CATV system without the approval of the Director of Public Works. SECTION 6. Location of Property of Grantee (A) Any poles, cable wires, conduits, or other properties of the Grantee to be constructed or installed in streets, shall be so constructed or installed only at such locations and in such manner as shall be approved by the Director of Public Works, acting in the exercise of his reasonable discretion. (B) The Grantee shall not install or erect any facilities or apparatus in or on other public property, places or rights-of- way, or within any privately -owned area within the City which has not yet become a public street but is designated or delineated as a proposed public street on any tentative subdivision map approved by the City, except those installed or erected upon public utility facilities now existing, without obtaining the prior written approval of the Director of Public Works. (C) In those areas and portions of the City where the transmission or distribution facilities of both the public utility providing telephone service and those of the utility providing electric service are underground or hereafter may be placed underground, then the Grantee shall likewise construct, operate and maintain all of its transmission and distribution facilities underground. For the purposes of this subsection, "underground" shall include a partial underground system, e.g. streamlining. Amplifiers and taps in Grantee's transmission and distribution lines may be in appropriate housings upon the surface of the ground as approved by the Director of Public Works. (D) Grantee shall give at least two days' notice on cable burial and shall relocate, alter or otherwise conform to the needs of the City when the City's underground service facilities are involved. (E) Where the system is to be undergrounded, the cable shall be buried not less than eighteen inches from the surface and crossings of arterial highways as shown on the City's circulation element shall not be open -trenched unless specific approval is given by the Director of Public Works. Erie WOO (F) The Grantee shall conform to all relevant provisions of law of the Federal and State government and the City. (G) The Grantee's CATV antenna shall be located at the end of Talvera Drive in Laguna Niguel for Storer and the end of Trabuco Creek Road for TM Cablevision. SECTION 7. Changes Required by Public Improvements The grantee shall at its expense, protect, support, temporarily disconnect, relocate in the same street or public place, or remove from the street or other public place, any property of the Grantee when required by the Director of Public Works by reason of traffic conditions, public safety, street vacation, freeway and street construction, change or establishment of street grade, installation of sewers, drains, water pipes, power lines, signal lines, and tracks or any other type of structures or improvements by public agencies; provided, however, that the Grantee shall in all such cases have the privileges and be subject to the obligations to abandon any property of the Grantee in place, as provided in Section 17. SECTION 8. Failure to Perform Street Work Upon failure of the Grantee to commence, pursue, or complete any work required by law or by the provisions of Section 3(B) or by this Ordinance to be done in any street or other public place, within the time prescribed, and to the satisfaction of the Director of Public Works, the Director of Public Works may at his option, cause such work to be done and the Grantee shall pay to the City the cost thereof in the itemized amounts reported by the Director of Public Works to the Grantee within thirty (30) days after receipt of such itemized report. SECTION 9. Franchise Payments (A) In consideration of the granting and exercise of a franchise to use the streets, as herein defined, for the operation of a cable television system, any Grantee shall pay to the City, quarterly, during the life of the franchise a percentage of its Gross Annual Subscriber Receipts; and at such time as the FCC shall change its rules to so allow, a percentage of its Gross Annual Receipts and Gross Annual Advertising Receipts and Gross Annual Lease Receipts. (B) The percentage payments shall be made in the manner, amounts and at times directed in said franchise or in a Council resolution fixing franchise fees and adopting rules for service and rate regulations. (C) Financial statement. The Grantee shall file with the City, within ninety (90) days after the expiration of any calendar year during which such franchise is in force, a financial statement certified by an officer of the Grantee or a Certified Public Accountant at the discretion of the City Council showing in detail its gross receipts in the City during the preceding calendar year in accordance with subsection (A) of this section. It shall be the duty of Grantee to pay to the City, within ten (10) days after the time for filing such statement, any unpaid balance for the calendar year covered by such statement. (D) Penalty payment. In the event that the unpaid balance for any calendar year is not received by the City within the time specified in subsection (C) of this section, the Grantee shall pay to the City a penalty of two percent (2%) per month on the unpaid balance in addition thereto until paid. 459 (E) The City shall have the right to inspect the Grantee's revenue records under the franchise and the right of audit and recomputation of any and all amounts payable under this Ordinance; the cost of said audit shall be borne by Grantee when the same results in changing the Grantee's annual payment to the City. (F) No acceptance of any payment shall be construed as a release or as an accord and satisfaction of any claim the City may have for further or additional sums payable under this Ordinance or for the performance of any other obligation hereunder. SECTION 10. Franchise Terms: Duration, Renewal, Renegotiation, and Termination Due to the rapid changes occurring in the regulatory, technical, financial, marketing and legal aspects of cable communications, and in order to provide maximum flexibility for the community as well as work toward an advanced and modern cable TV system for San Juan Capistrano, provisions shall be included in the franchise for franchise renewal and renegotiation. (A) Duration and Renewal of Franchise The franchise granted by the Council under this Ordinance shall be for a term to be set in the franchise; thereafter, after full public hearings, and in accordance with the franchise -renewal procedure that follows, the franchise may be renewed for a term not exceeding 12 years as in the opinion of Council will serve the public interest. (1) Procedure to consider franchise renewal: (i) Thirteen months before expiration of the franchise, the Cable TV Board whose membership shall consist of members from the community and/or from City administrative staff may be appointed by the Council to review the performance of the Grantee and the content of the Cable TV Ordinance. (ii) After giving public notice, the Board shall review the provisions of the Ordinance and the franchise contract as well as the performance of the Grantee. (iii) The Board shall complete and submit its recommendations to the Council no later than six months prior to the expiration of the franchise. (iv) If the Council finds the Grantee's performance satisfactory, a new franchise may be granted pursuant to the Ordinance as amended. (v) In the event the Grantee is determined by Council to have performed unsatisfactorily, then new applicants shall be sought and evaluated and a franchise award made by the Council according to cable TV franchising procedures herein provided. (B) Renegotiation of Franchise Terms The City and Grantee shall, upon the written request of either party, meet in scheduled sessions for review or renegotiation of any of the terms and conditions of the franchise, in accordance with the following procedures: (1) All sessions shall be scheduled at a mutually convenient time and place, and shall be conducted under an agenda setting forth the topics to be discussed at each session. Either party may add additional topics to the agenda by providing prior written notice thereof to the other party. (2) The sessions shall be scheduled at the earliest convenient date for the parties. Unless otherwise agreed to by both parties, the sessions shall commence within ninety (90) days of the date of the written request for such sessions. (3) All scheduled sessions may be conducted informally, unless a prior written request is made by either party for a formal public session, in which event such session shall be open to the public and public notice shall be given of the session and the topics to be discussed at least five (5) days prior to the session. (4) All scheduled sessions shall be conducted by the Cable TV Board or the City Staff appointed by the City Council, which shall prepare and file with the Council a public report of the sessions and any recommendations of change in the terms and conditions of the franchise and the findings and reasons therefor. (5) Amendments to this Ordinance or to the franchise shall be adopted in accordance with the procedures provided in this Section. (C) Termination of Franchise The Council may terminate any franchise granted pursuant to the provisions of this Ordinance in the event of the neglect, willful failure, or refusal by the Grantee to do or comply with any material requirements or limitation contained in this Ordinance, or any material rule or regulation of the Council validly adopted pursuant to this Ordinance. Such termination shall be made only after full public hearing and in accordance with the following procedures: (1) The Council or Chief Administrative Officer may make a written demand that the Grantee do or compl} with any such requirement, limitation, term, condition, rule or regulation contained in the Ordinance. If the failure refusal, or neglect of the Grantee continues for a period of thirty (30) days following such written demand, the Council or Chief Administrative Officer may place his request for termination of the franchise upon the next regular Council meeting agenda. The Council or Chief Administrative Officer shall cause to be served upon such Grantee at least ten (10) days prior to the date of such Council meeting, a written notice of intent to request such termination and the time and place of the meeting, notice of which shall be published by the City Clerk at least ten (10) days before such meeting in a newspaper of general circulation within the City. -10- 461 (2) The Council shall consider the request of the Chief Administrative Officer and shall hear any person interested therein, and shall determine in its discretion, whether or not any failure, refusal, or neglect by the grantee was material and with just cause. (3) If such failure, refusal or neglect by the Grantee was with just cause, the Council shall direct the Grantee to comply within such time and manner and upon such terms and conditions as are reasonable. (4) If the Council shall determine such failure, refusal or neglect by the Grantee was without just cause, then the Council may, by resolution declare that the franchise of such Grantee shall be terminated and forfeited unless there be compliance by the Grantee within such period as the Council may fix. (5) Termination and forfeiture of any franchise shall in no way affect the rights of the City under the franchise or any provisions of law. (6) In the event of any holding over after expiration or termination of any franchise granted hereunder, without the prior consent of the City, expressed by resolution, the Grantee shall pay to the City compensation and damages, of operating revenue during said period. (7) In the event of the bankruptcy or other insolvency of the Grantee. (D) Reporting Requirements In addition to the financial statement filed with the City in connection with the franchise payment, the Grantee shall provide the following: (1) Copies of all filings and reports to the Federal Communications Commission at the time of filing with the Commission; (2) An annual report containing financial and service information in content and form specified in the franchise; and (3) Interim reports as may be hereafter required by the Council. SECTION 11. Applications for Franchise (A) Each application for a franchise to construct, operate or maintain any cable television in this City shall be filed with the City Clerk and shall, upon the request of the City Manager, contain or be accompanied by the following: (1) The name, address, and telephone number of the applicant; (2) A detailed statement of the corporate or other business entity organization of the applicant, including but not limited to, the following items to whatever extent required by the City: now 46 (i) The names, residence and business addresses of all officers, directors, and associates of the applicant. (ii) The names, residence and business addresses of all officers, persons and entities having, controlling, or being entitled to have or control 5% or more of the ownership of the applicant. (iii) The names and addresses of any parent or subsidiary of the applicant, (including any other business entity owning or controlling applicant in whole or in part or owned or controlled in whole or part by the applicant), and a statement describing the nature of any such parent or subsidiary business entity, including but not limited to cable television systems owned or controlled by the applicant, its parent or subsidiary and the areas served therby. (iv) A detailed description of all previous experience of the applicant in providing television system service and in related or similar fields. (v) A detailed and complete financial statement of the applicant, prepared by a certified public accountant, for the fiscal year next preceding the date of the application hereunder, or a letter or other acceptable evidence in writing from a recognized lending institution or funding source, addressed to both the applicant and the Council, setting forth the basis for a study performed by such lending institution or funding source, and a clear statement of its intent as a lending institution or funding source to provide whatever capital shall be required by the applicant to construct and operate the proposed system in the City, or a statement from a certified public accountant, certifying that the applicant has available sufficient free, net and uncommitted cash resources to construct and operate the proposed system in this City. (vi) A statement identifying, by place and date, any other cable television franchise(s) awarded to the applicant, its parent or subsidiary; the status of said franchise(s) with respect to completion of such system(s) and the amount of applicant's and its parent's or subsidiary's resources committed to the completion thereof. (3) A detailed description of the proposed plan of operation of the applicant which shall include, but not be limited to, the following: (i) A detailed strand map indicating all areas of the City proposed to be served, and a proposed time schedule for the installation of all equipment necessary for the system to become operational throughout the entire areas to be served. The map shall clearly delineate any areas which will not be served, if any. -12- (ii) A statement or schedule setting forth all proposed classifications of rates and charges to be made against subscribers and all rates and charges as to each of said classifications, including installation charges and service charges. (iii) A detailed, informative, and referenced statement describing the actual equipment and operational standards proposed by the applicant. In no event shall said operational and performance standards be less than those currently or hereafter required by the Federal Communications Commission or those hereafter adopted by the Council. (iv) A copy of the form of any agreement, undertaking, or other instrument proposed to be entered into between the applicant and any subscriber. (v) A detailed statement setting forth in its entirety any and all agreements and undertakings whether formal or informal, written, oral, or implied, existing or proposed to exist between the applicant and any person, firm or corporation which materially relate or pertain to or depend upon the application and the granting of the franchise. (4) A copy of any agreement covering the franchise area, if existing between the applicant and any public utility subject to regulation by the California Public Utilities Commission providing for the use of any facilities of the public utility, including but not limited to poles, lines, or conduits. (5) Any other details, statements, information of references pertinent to the subject matter of such application which shall be required or requested by the Council, or by any provision of any other ordinance of the City. (B) The Council may, by advertisement or any other means, solicit and call for applications for cable television system franchises, and may determine and fix any date upon or after which the same shall be received by the City, or the date before which the same must be received, or the date after which the same shall not be received, and may make any other determinations and specify any other times, terms, conditions, or limitations respecting the soliciting, calling for, making and receiving of such applications. The Grantee shall pay the City a sum of money sufficient to reimburse it for all publication expenses incurred by it in connection with the granting of a franchise pursuant to the provisions of this Ordinance. Such payment shall be made within thirty (30) days after the City furnishes the Grantee with a written statement of such expenses. (C) Upon receipt of any application for franchise, the Council may refer the same to the Cable TV Board which shall prepare a report and make recommendations respecting such application, and cause the same to be completed and filed with the Council within thirty (30) days. -13- / � I (D) In making any determination hereunder as to any application the Council may give due consideration to the quality of the service proposed, rates to subscribers, income to the City, extent of the franchise area proposed to be served by the cable, experience, character, background, and financial responsibility of any applicant and its management, and willingness and ability to meet construction and physical requirements, and to abide by policy conditions, franchise limitations and requirements, and any other considerations deemed pertinent by the Council for safeguarding the interests of the City and the public. The Council, in its discretion, shall determine the award of any franchise on the basis of such considerations and without competitive bidding. If the Council shall determine to reject such application, such determination shall be final and conclusive, and the same shall be deemed rejected. (E) If the Council shall determine to further consider the application, the following shall be done: (1) The Council shall decide and specify the terms and conditions of any franchise to be granted hereunder and as herein provided. (2) The Council shall pass its resolution of intention to consider the granting of such a franchise, giving notice of receipt of the application, and describing the character of the franchise desired, stating the name of the proposed Grantee, the character of the franchise, the terms and conditions upon which franchise is proposed to be granted, that copies of the proposed franchise may be obtained at the office of the City Clerk, fixing and setting forth a day, hour and place certain when and where any persons having any interest therein or objection to the granting thereof may file written protests and appear before the Council and be heard, and directing the City Clerk to publish said resolution at least once within ten (10) days of the passage thereof in the TV section of a newspaper of general circulation within the City and to post said resolution at the designated official posting places within the City. The City Clerk may also be directed by Council to arrange for airing of the resolution on one local TV channel between the hours of 7 PM and 9 PM for five (5) consecutive days prior to the hearing. (F) At the time set for the hearing, or at any adjournment thereof, the Council shall proceed to hear all oral or written protests. Thereafter, the Council shall make one of the following determinations: (1) That such franchise be denied; or (2) That such franchise be granted upon the terms and conditions as specified in the resolution or intention to grant the same; or (3) That such franchise be granted, but upon the terms and conditions different from those specified in the resolution of intent to grant same. 6CC 465 (G) If the Council shall determine that a franchise be denied such determination shall be expressed by resolution and shall be final and conclusive. If the Council shall determine that a franchise be granted upon the terms and conditions as specified in the resolution of intention to consider granting the same, such determination shall be expressed by ordinance granting a franchise to the applicant. If the Council shall determine upon granting a franchise upon terms and conditions different from those specified in the resolution of intention to consider granting the same, then such determination shall be expressed by resolution adopted prior to granting a franchise by ordinance. SECTION 12. Bonds: Indemnification, Insurance (A) Performance Bond to City. Upon being granted a franchise, and upon the filing of the acceptance required under Section 13 hereof, the Grantee shall file with the City Clerk and shall thereafter, annually, during the entire term of such franchise, maintain in full force and effect a corporate surety bond or other adequate surety agreement in such amount and kind as shall have been approved by the Council. The bond or agreement shall be so conditioned that in the event that Grantee shall fail to comply with any one or more of the provisions of this Ordinance or of such franchise, then there shall be recoverable jointly and severally from the principal and surety any damages or loss, or costs suffered or incurred by the City as a result thereof, including attorney's fees and costs of any action or proceeding, and including the full amount of any compensation, indemnification, cost of removal or abandonment of any property or other costs which may be in default, up to the full principal amount of such bond. Said condition shall be a continuing obligation during the entire term of such franchise and thereafter until Grantee shall have satisfied in full any and all obligations to the City which arise out of or pertain to said franchise. Neither the provisions of this section, nor any bond accepted by the City pursuant hereto, nor any damages recovered by the City thereunder shall be construed to excuse faithful performance by the franchise issued pursuant to this Ordinance or for damages either to the full amount of the bond, or otherwise. (B) Performance Bond for Subscribers. Upon being granted a franchise, and upon filing of the acceptance required under Section 13 hereof, the Grantee shall file, annually, with the City Clerk and shall thereafter during the entire term of such franchise maintain in full force and effect a corporate surety bond, or other adequate surety agreement, in the amount as shall have been approved by the Council. The bond or agreement shall be so conditioned that in the event such Grantee shall fail to comply with any one or more of the provisions of any agreement or undertaking made between Grantee and any sub- scriber, then there shall be recoverable jointly and severally from the principal and surety any damages or costs suffered or incurred by any subscriber as a result thereof, including reasonable attorney's fees and costs of any action or proceeding. Said condition shall be a continuing obligation during the entire term of such franchise and thereafter until Grantee shall have satisfied in full any and all obligations to any subscriber which arise out of or pertain to any such agreement or undertaking. (C) Hold Harmless Agreement. Grantee shall indemnify and hold harmless the City, its officers, boards, commissions, agents, and employees, against and from any and all claims, demand, causes of actions, actions, suits, proceedings, damages -15- (including but not limited to damages to City property and damages arising out of copyright infringements, and damages arising out of any failure by Grantee to secure consents from owners, authorized distributors or licensees of programs to be delivered by Grantee's cable television system), costs or liabilities (including costs or liabilities of the City with respect to its employees), of every kind and nature whatsoever, including but not limited to damages for injury or death or damage to any person or property, and regardless of the merit of any of the same, and against all liability to others, and against any loss, cost, and expense resulting or arising out of any of the same, including any attorney fees, accountant fees, expert witness or consultant fees, court costs, per diem expense, traveling and transportation expense, or other expense arising out of or pertaining to the exercise or the enjoyment of any franchise hereunder by Grantee or the granting thereof by the City. (D) Defenseof Litigation. Grantee shall at the sole risk and expense of the Grantee, upon demand of the City, made by and through the City Attorney, appear in and defend any and all suits, actions, and other legal proceedings, whether judicial, quasi-judicial, administrative, legislative, or otherwise brought or instituted or had by third persons, or duly constituted authorities, against or affecting the City, its officers, boards, commissions, agents, or employees, and arising out of or pertaining to the exercise or the enjoyment of such franchise, or the granting thereof by the City. Grantee shall pay and satisfy or cause to be paid and satisfied any judgment, decree, order, directive, or demand rendered, made or issued against Grantee, the City, its officers, boards, commissions, agents, or employees arising out of or pertaining to the granting or exercise of such franchise; and such payment or satisfaction shall exist and continue without reference to or limitation by the amount of any bond, policy or insurance, deposit, undertaking or other assurance required hereunder, or otherwise; provided, that neither Grantee nor City shall make or enter into any compromise or settlement of any claim, demand, cause of action, action, suit, or other proceeding arising out of or pertaining to the granting or exercise of such franchise, without first obtaining the written consent of the other. (E) Insurance Required. Upon being granted a franchise, and upon the filing of the acceptance required under Section 13 hereof, the Grantee shall file with the City Clerk and shall thereafter during the entire term of such franchise maintain in full force and effect at its own cost and expense the following policies of insurance: General Comprehensive Liability Insurance in the amount of $1,000,000 together with Bodily Injury Liability Insurance in an amount not less than $500,000 for injuries including accidental death, to any one person, and subject to the same limit for each person in an amount not less than $1,000,000 on account of any one occurrence, and Property Damage Liability Insurance in an amount not less than $1,000,000 resulting from any one occurrence; provided, however, as follows: (1) The City shall be named as an additional insured in any of said insurance policies; and (2) Where such insurance is provided by a policy which also covers Grantee or any other entity or person, it shall contain the standard cross -liability endorsement. -16- 467 SECTION 13. Acceptance of the Franchise (A) No franchise granted under this Ordinance shall become effective for any purpose unless and until written acceptance therof shall have been filed with the City Clerk. Written acceptance, which shall be in the form and substance approved by the City Attorney, shall also be and operate as an acceptance of each and every term and condition and limitation contained in this Ordinance, or in such franchise, or otherwise specified as herein provided. (B) The written acceptance shall be filed by the Grantee not later than 12:01 PM of the fortieth (40th) day next following the effective date of the ordinance granting such franchise. (C) In default of the filing of such written acceptance as herein required, the Grantee shall be deemed to have rejected and repudiated the franchise. Thereafter, the acceptance of the Grantee shall not be received nor filed by the City Clerk. The Grantee shall have no rights, remedies, or redress in the premises, unless and until the Council, by resolution, shall determine that such acceptance be received or filed, and then upon such terms and conditions as the Council may impose. (D) In any case, and in any instance, all rights, remedies and redress in these premises which may or shall be available to the City, shall at all times be available to the City, and shall be preserved and maintained and shall continuously exist in and to the City, and shall not be in any manner or means modified, abridged, altered, restricted, or impaired by reason of any of these premises, or otherwise. (E) Any franchise granted and accepted under this chapter shall be in lieu of any and all other rights, privileges, powers, immunities, and authorities owned, possessed, controlled, or exercisable by the Grantee, of or pertaining to the construction, operation, or maintenance of any cable television systems in the City. SECTION 14. Limitations of Franchise: Includes Transfer Conditions (A) Every franchise granted under this Ordinance shall be non-exclusive. (B) No privileges or exemption shall be granted or conferred by any franchise granted under this Ordinance except those specifically prescribed herein. (C) Any privilege claimed under any such franchise by the Grantee in any street or other public property shall be subordinate to any prior lawful occupancy of the streets or other public property. (D) Any such franchise shall be a privilege to be held in personal trust by the original Grantee. It cannot in any event be sold, transferred, leased, assigned or disposed of, in whole or in part, either by forced or involuntary sale, merger, consolidation or otherwise, without prior consent of the Council expressed by resolution following at least one public hearing, and then only under such conditions as may therein be prescribed. Any such transfer of assignment shall be made only by an instrument in writing, such as a bill of sale, or similar document, a duly executed copy of which shall be filed in the office of the City Clerk within thirty (30) days after any such -17- transfer or assignment. The said consent of the Council may not be unreasonably refused; provided, however, the proposed assignee must show financial responsibility as determined by the Council and must agree further, that no such consent shall be required for a transfer in trust, mortgage, or other hypothecation, in whole or in part, to secure an indebtedness, except that when such hypothecation shall exceed 508 of the market value of the property used by the Grantee in the conduct of the cable television system, prior consent of the Council shall be required for such a transfer. Such consent shall not be withheld unreasonably. In the event that Grantee is a corporation, prior approval of the City Council, expressed by ordinance, shall be required where there is an actual change in control or where ownership of more than 508 of the voting stock of Grantee is acquired by a person or group of persons acting in concert, none of whom already own 508 or more of the voting stock, singly or collectively. Any such acquisition occurring without prior approval of the City Council shall constitute a failure to comply with a provision of this Ordinance within the meaning of Section 10(C) of this Ordinance. (E) Time shall be of the essence of any such franchise granted hereunder. The Grantee shall not be relieved of his obligation to comply promptly with any of the provisions of this Ordinance by any failure of the City to enforce prompt compliance. (F) Any right or power in, or duty impressed upon, any officer, employee, department, or board of the City shall be subject to transfer by the City to any other officer, employee, department, or board of the City. (G) The Grantee shall have no recourse whatsoever against the City for any loss, cost, expense, or damage arising out of any provision or requirement of this ordinance or of any franchise issued hereunder or because of its enforcement. (H) The Grantee shall be subject to all requirements of City laws, rules, regulations, and specifications heretofore or hereafter enacted or established. (I) Any such franchise granted shall not relieve the Grantee of any obligations involved in obtaining conduit space from any department of the City, utility company, or from others maintaining utilities in streets. (J) Any franchise granted hereunder shall be in lieu of any and all other rights, privileges, powers, immunities, and authorities owned, possessed, controlled or exercisable by Grantee, or any successor to any interest of Grantee,of or pertaining to the construction, operation, or maintenance of any cable television system in the City; and the acceptance of any franchise hereunder shall operate, as between Grantee and the City, as an abandonment by Grantee of any and all of such rights, privileges, powers, immunities, and authorities within the City; and all construction, operation and maintenance by any Grantee of any cable television system in the City shall be, and shall be deemed and construed in all instances and respects to be, under and pursuant to said franchise, and not under or pursuant to any other right, privilege, power, immunity, or authority whatsoever. SECTION 15. Rights Reserved to the City (A) Nothing herein shall be deemed or construed to impair or affect, in any way, to any extent, the right of the City to acquire the property of the Grantee, either by purchase -18- or through the exercise of the right of eminent domain, at a fair and just value, which shall not include any amount for the franchise itself or for any of the rights or privileges granted, and nothing herein contained shall be construed to contract away or to modify or abridge, whether for a term or in perpetuity, the City's right of eminent domain. (B) There is hereby reserved to the City every right and power which is required to be herein reserved or provided by any law, and the Grantee, by its acceptance of the franchise, agrees to be bound thereby and to comply with any action or requirements of the City in its exercise of such rights or power, heretofore or hereafter enacted or established. (C) There is hereby reserved to the City the power to amend any section of this Ordinance so as to require additional or greater standards of construction, operation, maintenance or otherwise, on the part of the Grantee to reflect technical and economic changes occurring during the franchise term, and to enable the City and the Grantee to take advantage of new developments in the cable television industry so as to more effectively, efficiently and economically serve the public. (D) Neither the granting of any franchise nor any provision hereof shall constitute a waiver or bar to the exercise of any governmental right or power of the City. (E) The Council may do all things which are necessary and convenient in the exercise of its jurisdiction under this Ordinance and may determine any question of fact which may arise during the existence of any franchise granted hereunder. The Chief Administrative Officer is hereby authorized and empowered to adjust, settle, or compromise any controversy or charge arising from the operations of any Grantee under this Ordinance, either on behalf of the City, the Grantee, or any subscriber, in the best interest of the public. Either the Grantee or any member of the public who may be dissatisfied with the decision made may within thirty (30) days thereof appeal the matter to the Council for hearing and determination. The Council may accept, reject or modify or cancel any charge arising from the operations of the Grantee or from any provision of this Ordinance. SECTION 16. Council to Adopt Rules and Regulations (A) The Council shall have continuing regulatory jurisdiction and supervision over the operation of any franchise granted hereunder and may from time to time adopt such reasonable rules and regulations as it deems necessary for the conduct of the cable television system. (1) The Council may adopt administrative procedures to ensure compliance with the terms of the franchise and may assess penalties for non-compliance which may be specified in the franchise. (2) The Council may appoint a Cable TV Board whose composition, powers, and responsibilities, pursuant to this Ordinance, and shall be hereafter determined by the Council. -19- 470 (B) Standards of Operation (1) Any cable television system in the City shall meet the technical performance standards now or hereafter required by the Federal Communications Commission and the installation and maintenance standards now or hereafter required by the City. (2) Any cable television system in the City and all equipment of such system shall be rated for 24-hour per day continuous operation. (3) Provided the same do not materially alter the content of the franchise without consent of the Grantee, the Council may at any time adopt new rules and regulations or standards, or may amend, modify, delete, or otherwise change its respective rules or regulations or standards previously adopted, in the following manner: The Council shall pass its resolution of intention stating or describing the rules or regulations or standards to be adopted, amended, modified, deleted, or otherwise changed, and fixing and setting forth a day, hour, and place certain when and where any persons having any interest therein or objection thereto may appear before the Council and be heard. Such resolution shall direct the City Clerk to publish the same at least once within ten (10) days of the passage thereof in a newspaper of general circulation within the City and to mail a copy of the same to any Grantee or applicant for a franchise, not more than thirty (30) days nor less than fifteen (15) days prior to the time fixed for hearing thereon. At the time set for such hearing, or at any adjournment thereof, the Council shall proceed to hear and pass upon such comments as may be presented. Thereafter, the Council, by its resolution, may adopt, amend, modify, delete, or otherwise change its respective rules, regulations, and standards. Such determination by the Council shall be final and conclusive. Any rule or regulation or standard as adopted, amended, modified, deleted, or otherwise changed by the Council shall become effective upon the tenth (10th) day following the adoption of such resolution, unless a longer period shall be otherwise provided in such resolution. (C) Grantee -Subscriber Contract Form. The City's Chief Officer shall review Grantee's form of any agreement, undertaking, or other instrument proposed to be entered into between the Grantee and any subscriber and make a finding that such instrument is in conformance with the provisions of this Ordinance and contains full disclosure of the subscriber's rights and obligations under this Ordinance including the number of channels guaranteed and a listing of said channels and table of rate structure to be provided to subscriber upon execution of agreement, the complaint procedure simply described in clear and legible type; City official responsible for receiving and acting on complaints may be registered and billing procedures including those for delinquency procedures. -20- 4'71 (D) Rates (1) Establishment and approval of rates. Prior to granting any franchise hereunder the Council after noticed public hearings as provided herein, by resolution shall establish and fix all rates and charges for the Basic Service, herein defined, allowable to Grantee, including, but not limited to: (i) Charges for installation; connection or reconnection; (ii) Special installation charges for problem sites; (iii) General subscriber rates; (iv) Service charges for separate classifications of service (e.g., FM radio broadcast, additional connections, etc.); (v) Preferential basic service rates; (vi) Advance payments. Once established, such rates or charges shall become part of the franchising agreement and shall not be changed at any time after granting of a franchise, except after due notice and hearing as provided herein. Any charges for additional service or equipment, such as converters, must be approved by the City Council. (2) At such time as the Federal Communictions Commission shall permit, rates and charges for services other than Basic Service shall also be approved by Council by resolution, after due notice and hearings as provided herein. (3) Council shall review the Grantee's proposed billing practices as they affect subscriber rates or advance payment, and once established, such billing practices shall not be changed without prior consent of Council in a public proceeding. (4) Request for Rate Changes (i) The City or Grantee may request rate increases or decreases at any time during the term of the franchise granted under this ordinance. Such consideration shall constitute a renegotiation of the terms of the franchise and shall observe the same procedures herein provided. (ii) The Council shall approve or disapprove any increase or decrease of the basic service rates or establish additional basic service areas on the basis of what is fair to the subscriber and to the Grantee and may include the following considerations (this section does not apply to promotional sales campaigns which offer reduced rates): -21- 472 (a) Value of the service or services; (b) Rates for comparable service or services in surrounding communities; (c) Faithfulness of Grantee in abiding by the terms of the Ordinance and franchise; (d) Quality of service; (e) Efficiency of Grantee's management; (f) Depreciated original cost of the cable plant and associated equipment. All intangible assets for which costs have not actually been expended, such as the value of the franchise, goodwill, and the value of the going concern shall not be amortized as an expense, and a return shall not be paid on any of these values. Actual costs, such as the purchase of a system above net book value, may be amortized over a period of not less than 12 years, but the amortized portion shall not be included in any rate base or rate of return calculations; and (g) A fair rate of return on Grantee's investment compared to investments having corresponding risk. (5) Conduct of Proceedings on Rate Changes. In connection with any proposed change of any rates or charges of Grantee to subscribers, or the approval of rates for additional services, at any time after the granting of a franchise, the Council may direct the Cable TV Board of the City to conduct a preliminary hearing into the matter. If so directed by the Council, the board shall issue a written notice fixing and setting forth the day, hour and place certain when and where any persons having any interest therein may appear and be heard. The City Clerk shall cause such notice to be published in the TV section of a newspaper of general circulation within the City and shall cause such notice to be posted at the designated official posting places within the City. The City Clerk also shall cause a copy of such notice to be mailed to any Grantee at least ten (10) days prior to the date specified for the hearing, as well as to civic and community organizations. At the time set for such hearing, or at any adjournment thereof, the Cable TV Board shall proceed to hear the matter. Following the close of such hearing, the Board shall prepare and file with the Council a report of the hearing, the Board findings, and an opinion containing Board recommendations and the reasons therefor. After the expiration of ten (10) days following receipt of the report and opinion, and if no objection has been filed _22_ 4'73 thereto, the Council shall determine whether to adopt the opinion or to hold a further hearing, and shall pass its resolution of intention to do so, describing and stating any rates or charges to be changed, the reasons of the Council therefor, fixing and setting forth a day, hour and place certain when and where any persons having any interest therein may appear before the Council and be heard. Such resolution shall direct the City Clerk to publish the same resolution at least once within ten (10) days of the passage thereof in the TV section of a newspaper of general circulation within the City and to post said resolution at the designated official posting places within the City. The City Clerk may also be directed by Council to arrange for airing of the resolution on one local community TV channel between the hours of 7 PM and 9 PM for five (5) consecutive days prior to the hearing. In addition, the City Clerk also shall cause a copy of such resolution to be mailed to the Grantee and to community and civic organizations in the City at least ten (10) days prior to the date specified for hearing thereon. At the time set for any further hearing, or at any adjournment thereon, the Council shall proceed to hear the matter. If upon receipt of report and opinion, and the expiration of said ten (10) days without objection, or following the holding of a further hearing, if the Council determines to do so, the Council shall find that the changing of any rates or charges of Grantee to subscribers will be fair to the system operator and not detrimental or injurious to the best interests and welfare of the subcribers and users, and of the City, then the Council, by resolution, shall authorize the change of rates or charges of Grantee to subscribers and users as determined. Such resolution shall thereupon become and shall be a part of any franchise granted hereunder and affected thereby. (6) Obligations of the Council. Notwithstanding this or any other ordinance to the contrary, the Grantee shall be entitled to file a request for rate change, accompanied by financial information, in the form specified in the franchise and current within the last operating quarter which said request shall be finally acted upon within a period of 180 days. If no final decision has been made by the Council within said period, the request shall be deemed granted. Any action taken by the Council shall include detailed and specific findings. In the event a rate increase is granted as requested, the Grantee shall refrain from applying for further increases for a period of twenty-four (24) months from the date of the granted increase. If the rate application is not granted as requested, the grantee may file succeeding requests at any time. -23- 474 SECTION 17. Permits and Construction (A) Within thirty (30) days after acceptance of any franchise, the Grantee shall proceed with due diligence to obtain all necessary permits and authorizations which are required in the conduct of its business, including, but not limited to, any utility joint use attachment agreements, micro -wave carrier licenses, and any other permits, licenses and authorizations to be granted by duly constituted regulatory agencies having jurisdiction over the operation of cable television systems, or associated micro -wave transmission facilities. In connection therewith, copies of all petitions, applications, and communications submitted by the Grantee to the Federal Communications Commission, Securites and Exchange Commission, or any other federal or state regulatory commission or agency having jurisdiction in respect to any matters affecting Grantee's cable television operations, shall also be submitted simultaneously to the Chief Administrative Officer. (B) Within ninety (90) days after obtaining all necessary permits, licenses and authorizations, including right - o£ -access to poles and conduits, Grantee shall commence construction and installation of the cable television system. (C) Within one hundred eighty (180) days after the commencement of construction and installation of the system, Grantee shall proceed to render service to subscribers, and the completion of the installation and construction shall be pursued with reasonable diligence thereafter, so that service to all of the areas designated and scheduled on the map and plan of con- struction made part of the franchise shall be provided as set forth therein. (D) Failure on the part of the Grantee to commence and diligently pursue each of the foregoing requirements and to complete each of the matters set forth herein shall be grounds for termination of such franchise. By resolution, the Council, in its discretion, may extend the time for the commencement and completion of installation and construction for additional periods in the event the Grantee, acting in good faith, experiences delays by reason of the circumstances beyond his control. By acceptance of the franchise granted hereunder, Grantee agrees that failure to comply with any time requirements referred to in subsections (A), (B), and (C) of this section will result in damage to the City, and that it is and will be impracticable to determine the actual amount of such damage in the event of delay; and Grantee therefore agrees that, in addition to any other damage suffered by the City, he will pay the City an amount to be specified in the franchise for each and every day's delay beyond the time prescribed, plus authorized extensions thereof, for completion of any of the acts required to be done by this section. (E) Grantee shall utilize existing conduits and other facilities whenever possible, and shall not construct or install any new, different, or additional conduits or other facilities whether on public property or on privately -owned property unless and until first securing the written approval of the Chief Administrative Officer. (F) The City shall have the right, free of charge, to make additional use, for any public or municipal purpose, whether governmental or proprietary, of any conduits or other similar facilities erected, controlled, or maintained exclusively by or for Grantee in any street, provided such use by City does not interfere with the use by Grantee. -24- 475 (G) In those areas of the City where the transmission or distribution facilities of the respective public utilities providing telephone, communication and electric services are underground, or hereafter are placed underground, the Grantee likewise shall construct, operate and maintain all of his transmission and distribution facilities underground. The term "underground" shall include a partial underground system; provided that upon obtaining the written approval of the Chief Administrative Officer, amplifiers in the Grantee's transmission and distribution lines may be placed in appropriate housings upon the surface of the ground. (H) The Grantee at his expense shall protect, support, temporarily disconnect, relocate, or remove any property of Grantee when, in the opinion of the Chief Administrative Officer the same is required by reason of traffic conditions, public safety, street vacation, freeway or street construction, change or establishment of street grade, installation of sewers, drains, waterpipes, power line, signal line, transportation facilities, tracks, or any other types of structure or improvements by governmental agencies whether acting in a governmental or a proprietary capacity; or any other structure or public improvement, including but not limited to movement of buildings, urban renewal and redevelopment, and any general program under which the City shall undertake to cause all such properties to be located beneath the surface of the ground. The Grantee shall in all cases have the privilege subject to the corresponding obligations, to abandon any property of Grantee in place, as herein provided. Nothing hereunder shall be deemed a taking of the property of Grantee, and Grantee shall be entitled to no surcharge by reason of anything hereunder. (I) Upon the failure, refusal, or neglect of Grantee to cause any work or other act required by law or hereunder to be properly completed in, on, over, or under any street within any time prescribed therefor, or upon notice given, where no time is prescribed, the Chief Administrative Officer may cause such work or other act to be completed in whole or in part, and upon so doing shall submit to Grantee an itemized statement of the costs thereof. The Grantee shall, within thirty (30) days after receipt of such statement, pay to the City the entire amount thereof. (J) In the event that, (1) the use of any part of the system of Grantee is discontinued for any reason for a continuous period of thirty (30) days, without prior written notice to and approved by the City; or (2) Any part of such system has been installed in any street or other area without complying with the requirements hereof; or (3) Any franchise shall be terminated, cancelled, or shall expire, then the Grantee shall, at the option of the City, and at the expense of the Grantee and at no expense to the City, and upon demand of the City, promptly remove from any street 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 such condition as the Chief Administrative Officer shall approve. -25- 476 The Council may, upon written application therefor by Grantee, approve the abandonment of any of such property in place by Grantee and under such terms and conditions as the Council may prescribe. Upon abandonment of any such property in place, Grantee shall cause to be executed, acknowledged, and delivered to the City such instruments as the City Attorney shall prescribe and approve, transferring and conveying the ownership of such property to the City. SECTION 18. Miscellaneous Provisions (A) A franchise granted to provide service within the City shall authorize and permit the Grantee to solicit, sell, distribute, and make a charge to subscribers within the City for connection to the cable television system of Grantee, and shall also authorize and permit the Grantee to traverse any portion of the City in order to provide service outside the City. (B) A franchise, easement, license or other permit granted to anyone other than the Grantee to traverse any portion of the City in order to provide service outside the City shall not authorize nor permit said person to solicit, sell, distribute, or make any charge to subscribers within the City, nor to render any service or connect any subscriber within the City to the cable television system of Grantee. (C) No franchise granted under this ordinance shall ever be given any value by any court or other authority, public or private, in any proceeding of any nature or character, wherein or whereby the City shall be a party or affected therein or thereby. (D) Grantee shall be subject to all provisions of the other ordinances, rules, regulations, and specifications of the City heretofore or hereafter adopted, including but not limited to those pertaining to works and activities in, on, over, and under and about streets. Any privilege claimed under any franchise granted pursuant to this Ordinance in any street or other public property shall be subordinate to any prior lawful occupancy of the streets or other public property. Grantee also shall be subject to the provisions of general laws of the State of California, or as hereafter amended, when applicable to the exercise of any privilege contained in any franchise granted under this Ordinance, including but not limited to those pertaining to works and activities in and about state highways. (E) Grantee shall be prohibited from directly or indirectly doing any of the following: (1) engaging in the business of selling at retail, leasing, renting, repairing, or servicing of television sets or radios; (2) imposing a fee or charge for any service or repair to subscriber -owned receiving devices except for the connection of its service; neither should any fee or charge be imposed by Grantee for determination of the quality of its signal to the receipients thereof; -26- (3) soliciting, referring, or causing or permitting the solicitation or referral of any subscriber to persons engaged in any business herein prohibited to be engaged in by Grantee; (4) providing information concerning the viewing patterns of identifiable individual subscribers to any person, group, or organization for any purpose. When two-way cable services are offered, activation of the return service must always be at the subscriber's option. The subscriber shall not be required to provide automatic readout information as a condition of receiving basic services. (F) If the Federal Communications Commission or the Public Utilities Commission of the State of California or any other federal or state body or agency shall now or hereafter exercise any paramount jurisdiction over the subject matter of any franchise granted under this Ordinance, then to the extent such jurisdiction shall preempt or preclude the exercise of like jurisdiction by the City, the jurisdiction of the City shall cease and no longer exist. The preemption or preclusion of the exercise by the City of any of its police power shall not diminish, impair, alter, or affect any contractual benefit to the City or Grantee or any contractual obligation of the Grantee under any franchise issued hereunder. Any and all minimum standards governing the operation of Grantee and any and all maximum rates, ratios, and charges specified herein or in any franchise issued hereunder, existing now and at any time in the future, including such time as any paramount jurisdiction shall preempt or preclude that of the City, and any and all rights, powers, privileges, and authorities of the City determine, establish, or fix any of the same, are each and all hereby declared by the City and by any Grantee accepting any franchise hereunder to be contractual in nature and to be for the benefit of the City. (G) When not otherwise prescribed herein, all matters herein required to be filed with the City shall be filed with the City Clerk. (H) No person, firm or corporation within the service area of the Grantee, and where trunk lines are in place, shall be refused service; provided, however, that the Grantee shall not be required to provide service to any subscriber who does not pay the applicable connection fee or service charge; nor could they be refused service where trunk lines are not in place and provided the applicant for service consents to defray excessive costs of such extension, as in exceptionally difficult terrain or remote areas, as defined in the franchise. (I) Before providing cable television service to any subscriber, the Grantee shall provide a written notice to the subscriber substantially as follows; "Subscriber is hereby notified that in providing cable television service the Grantee is making use of public rights-of-way within the City of San Juan Capistrano and that the continued use of such rights-of-way is in no way guaranteed." -27- M 4 "In the event the continued use of such rights-of-way is denied to Grantee for any reason, Grantee will make every reasonable effort to provide service over alternate routes. By accepting cable television service, subscriber agrees he will make no claim nor undertake any action against the City of San Juan Capistrano, its officers, or its employees if the service to be provided hereunder is interrupted or discontinued." SECTION 19. Removal and Abandonment of Property of Grantee (A) In the event that the use of any part of the CATV system is discontinued for any reason for a continuous period of twelve months, or in the event such system or property has been installed in any street or public place without complying with the requirements of this franchise or Ordinance or this franchise has been terminated, cancelled or has expired, the Grantee shall promptly, upon being given fifteen days notice, remove from the streets or public places all such property and poles of such system other than any which the Director of Public Works may permit or require to be abandoned in place to the City. In the event of such removal, the Grantee shall promptly restore the street or other area from which such property has been removed to a condition satisfactory to the Director of Public Works. (B) Any property of the Grantee remaining in place thirty days after the termination or expiration of this franchise shall be considered permanently abandoned to the City. The City Manager may extend such time not to exceed an additional thirty days. (C) Any property of the Grantee to be abandoned in place shall be abandoned to the City in such a manner as the Director of Public Works shall prescribe. Upon permanent abandonment of the property of the Grantee in place, the property shall become that of the City, and the Grantee shall submit to the Director of Public Works an instrument in writing, to be approved by the City Attorney, transferring to the City the ownership of such property. SECTION 20. Effect of Annexations (A) In the event any new territory shall become annexed to the City then the Council shall determine at a public hearing, which Grantee or Grantees, if any, shall serve such new territory. (B) Whenever any territory shall become a part of a franchise area by reason of annexation as provided in this section, Council shall hold a public hearing to determine a time schedule for the installation of all equipment necessary for cable television to become operational throughout that territory. The time schedule shall provide for construction of cable television facilities in said territory on a reasonable and equitable basis as determined by the Council. (C) The Chief Administrative Officer shall send notice of any public hearing provided for in this section to any Grantee whose rights or franchise area may be affected thereby, by mail, postage prepaid, not less than seven (7) days prior to such hearing. -28- 479 (D) Whenever any territory which is covered by an existing franchise granted by the County of Orange is annexed to the City after the effective date of this Ordinance, the rights reserved under said franchise to the County of Orange or to any officer thereof shall inure to the benefit of the City of San Juan Capistrano. SECTION 21. Equal Opportunity Employment and Affirmative Action Plan (A) In the carrying out of the construction, maintenance and operation of the cable television system, the Grantee shall not discriminate against any employee or applicant for employment because of race, creed, color, sex, or national origin. (B) The Grantee shall take affirmative action to ensure that applicants are employed, and that employees are treated during employment, without regard to their race, creed, color, sex, or national origin. Such affirmative action shall include, but not be limited to, the following: employment, upgrading, demotion or transfer, recruitment or recruitment advertising, layoff or termination, rates of pay or other forms of compensation, and selection for training, including apprenticeship. (C) The Grantee shall post in conspicuous places, available to employees and applicants for employment, notice setting forth the provisions of this non-discrimination clause. (D) The Grantee shall, in all solicitations or advertisements for employees placed by or on behalf of the Grantee, state that all qualified applicants will receive consideration for employment without regard to race, creed, color, sex or national origin. SECTION 22. Violtations (A) From and after the effective date of this Ordinance, it shall be unlawful for any person to construct, install or maintain within any public street in the City, or within any other public property of City, or within any privately -owned area within the City which has not yet become a public street but is designated or delineated as a proposed public street on any tentative subdivision map approved by the City, any equipment or facilities for distributing any television signals or radio signals through a cable television system, unless a franchise authorizing such use of such street or property or area has first been obtained pursuant to the provisions of this Ordinance, and unless such franchise is in full force and effect. (B) It shall be unlawful for any person, firm or corporation to make or use any unauthorized connection, whether physically, electrically, accoustically, inductively, or otherwise, with any part of a frachised cable television system within this City for the purpose of enabling himself or others to receive or use any television signal, radio signal, picture, program or sound, without payment to the owner of said system. (C) It shall be unlawful for any person, without the consent of the owner, to willfully tamper with, remove or injure any cables, wires or equipment used for distribution of television signals, radio signals, pictures, programs or sound. -29- I�� SECTION 23. Severability If any section, subsection, sentence, clause or phrase of this Ordinance is for any reason held illegal, invalid, or unconstitutional by the decision of any court of competent jurisdiction, such decision shall not affect the validity of the remaining portions hereof. The Council hereby declares that it would have passed this Ordinance, and each section, subsection, sentence, clause, and phrase hereof, irrespective of the fact that any one or more sections, subsections, sentences, clauses or phrases be declared illegal, invalid, or unconstitutional. The invalidity of any portion of this Ordinance shall not abate, reduce or otherwise affect any consideration or other obligation required of the Grantee of any franchise granted hereunder. SECTION 24. Effective Date This Ordinance shall take effect and be in force 30 days after its passage. SECTION 25. Clerk's Certification The City Clerk shall certify to the adoption of this Ordinance and shall cause the same to be posted in the duly designated posting places within the City of San Juan Capistrano within 15 days after its passage. PASSED, APPROVED AND ADOPTED, this 3rd day of August , 1977, by the following vote, to wit: AYES: Councilmen Sweeney, McDowell, Friess, Nash, and Mayor Heckscher NOES: None ABSENT: None L � V N O. HECKSCHER, MAYOR ATTEST: CITY CLE7.1 ' _ STATE OF CALIFORNIA ) COUNTY OF ORANGE ) ss. CITY OF SAN JUAN CAPISTRANO ) I, MARY ANN HANOVER, 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. 327 , which was introduced at a meeting of the City Council of the City of San Juan Capistrano, California, held on July 20 , 1977 , and adopted at a meeting held on August 3 . 1977 - (SEAL) ,/� //�j,ip2 `L'� MARY ANN NOVER, CITY CLERK -30-