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ORDINANCE 1165ORDINANCE NO. 1165 AN ORDINANCE TO PROVIDE FOR THE ESTABLISHMENT AND GRANTING OF FRANCHISES OR PRIVILEGES FOR THE CONSTRUCTION, MAINTENANCE AND OPERATION OF CABLE COMMUNICATIONS OR CABLE TELEVISION SYSTEMS AND FURTHER PROVIDING FOR THE CON- TINUING REGULATION AND ADMINISTRATION OF THESE FRANCHISES AND THE ACTIVITIES RELATIVE TO THEM. THE CITY COUNCIL OF THE CITY OF EL SEGUNDO, CALIFORNIA, DOES ORDAIN AS FOLLOWS: SECTION 1. CHAPTER 14.60 of the "E1 Segundo Municipal Code" is repealed. SECTION 2. CHAPTER 14.60 is added to the "El Segundo Municipal Code" to read as follows: *%r SECTION 14.60 L179 CABLE TELEVISION SYSTEMS a• SECTION 14.60.001. TABLE OF CONTENTS. Page SECTION 14.60.010 INTENT . . . . . . . . . . . . . . . . . 3 SECTION 14.60.020 SHORT TITLE . . . . . . . . . . . . . . 4 SECTION 14.60.030 DEFINITIONS . . . . . . . . . . . . . . 5 THROUGH SECTION 14.60.060 SECTION 14.60.070 GRANT OF FRANCHISE . . . . . . . . . . . 10 THROUGH SECTION 14.60.080 SECTION 14.60.090 REGULATION OF FRANCHISE . . . . . . . . 22 SECTION 14.60.100 GENERAL FINANCIAL AND INSURANCE . . . . 29 PROVISIONS SECTION 14.60.110 DESIGN AND CONSTRUCTION PROVISIONS . . . 34 THROUGH SECTION 14.60.020 SECTION 14.60.130 SERVICE PROVISIONS . . . . . . . . . . . 42 SECTION 14.60.140 OPERATION AND MAINTENANCE . . . . . . . 43 SECTION 14.60.150 RIGHTS RESERVED TO THE GRANTOR . . . . . 44 SECTION 14.60.160 RIGHTS RESERVED TO THE GRANTEE . . . . . 45 SECTION 14.60.170 FRANCHISE VIOLATIONS . . . . . . . . . . 46 SECTION 14.60.180 REPORTS . . . . . . . . . . . . . . . . 49 THROUGH SECTION 14.60.190 SECTION 14.60.200 MISCELLANEOUS PROVISIONS . . . . . . . . 53 Owl 2 SECTION 14.60.010. INTENT The City of E1 Segundo finds that the development of cable IIPftr television and communications systems has the potential of having great benefit and impact upon the residents of E1 Segundo. Because of the complex and rapidly changing technology associated with cable television, the City further finds that the public convenience, safety and general welfare can best be served by establishing regulatory powers which should be vested in the City or such persons as the City shall designate. Consistent with Federal and State law, it is the intent of this ordinance and subsequent amendments to provide for and specify the means to attain the best possible public interest and public purpose in these matters and any franchise issued pursuant to this ordinance `'' shall be deemed to include this finding as an integral part thereof. Shw 3 SECTION 14.60.020. SHORT TITLE This ordinance shall be known and may be cited as the "City 164W of E1 Segundo Cable Communications Franchise Ordinance ". sw 4 SECTION 14.60.030. DEFINITIONS For the purpose of this ordinance the following terms, phrases, words and their derivations shall have the meaning given herein. Words used in the present tense include the future, words in the plural number include the singular number, and words in the singular number include the plural number. Words not defined shall be given their common and ordinary meaning. 14.60.031 "Basic Cable Service" means any service tier which includes the retransmission of local television broadcast signals. 14.60.032 "Cable Communications System" or "System ", also referred to as "Cable Television System ", "Cable System ", "CATV System ", or "Community Antenna TV System ", means a facility, �4w consisting of a set of closed signal generation, reception, designed to provide cable ser ming and which is provided to community, but such term does transmission paths and associated and control equipment, that is vice which includes video program - multiple subscribers within a not include: (a) A facility that serves only to retransmit the television signals of one or more television broadcast stations; (b) A facility that serves only subscribers in one or more multiple unit dwellings under common ownership, control, or management, unless such facility uses any public right -of -way; (c) A facility of a common carrier, except that such facility shall be considered a cable system 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 system. 14.60.033 "Cable Service" means the total of the following: (a) The one -way transmission to subscribers of video programming or other programming service; and 5 (b) Subscriber interaction, if any, which is required for the selection of such video programming or other programming service. 14.60.034 "Channel" or "Cable Channel" means a portion of the electromagnetic frequency spectrum which is used in a cable system and which is capable of delivering a television channel as defined by the Federal Communications Commission. 14.60.035 "Commence Construction" means that time and date when construction of the Cable Communications System is con- sidered to have commenced, which shall be when the first connec- tion is physically made to a utility pole, or undergrounding of cables is initiated. 14.60.036 "Commence Operation" means that time and date when operation of the Cable Communications System is considered to have commenced which shall be when sufficient distribution facilities have been installed so as to permit the offering of full services to a dwelling unit located within the franchise area and such services are actually offered to a resident of the franchise area. 14.60.037 "Commercial Use Channel(s)" means the channel capacity designated for commercial use as defined and required by federal law. 14.60.038 "Completion of Construction" means that point in ItW time when all distribution facilities specified in the Franchise ILM Agreement have been installed by the Grantee so as to permit the offering of cable service to all of the potential subscribers in the franchise area, as well as the provision, in an operational state, of any facilities required by the franchise Agreement. 14.60.039 "Converter" means an electronic device which converts signal carriers from one form to another. 14.60.040 "Council" means the governing body of the City of El Segundo. 14.60.041 "FCC" means the Federal Communications Commission and any legally appointed or elected successor. R 14.60.042 "Franchise" means an initial authorization, or renewal thereof issued by a franchising authority, whether such `r► authorization is designated as a franchise, permit, license, resolution, contract, certificate, agreement, or otherwise, which authorizes the construction or operation of a cable system. 14.60.043 "Franchise Agreement" means a franchise award ordinance, or a contractual agreement, containing the specific provisions of the franchise granted, including referenced speci- fications, franchise applications, franchise requirements ordi- nances and other related materials. 14.60.044 "Franchise Fees" means any tax, fee or assessment of any kind imposed by a franchising authority or other govern- mental entity on a Grantee or cable subscriber, or both, solely %Aw because of their status as such. The term "franchise fee" does not include: (a) Any tax, fee or assessment of general appli- cability (including any such tax, fee, or assessment imposed on both utilities and cable operators or their services but not including a tax, fee, or assessment which is unduly discrimi- natory against Grantee or cable subscribers); (b) Capital costs which are required by the franchise to be incurred by Grantee for public, educational, or governmental access facilities; ItW (c) Requirements or charges incidental to the awarding or enforcing of the franchise, including payments for bonds, security funds, letters of credit, insurance, indemnifi- cation, penalties, or liquidated damages; or (d) Any fee imposed under Title 17, United States Code. 14.60.045 "Grantee" means any "person" receiving a fran- chise pursuant to this ordinance and under the granting franchise ordinance or agreement, and its lawful successor, transferee or assignee. `W 7 14.60.046 "Grantor" or "City" means the City of E1 Segundo as represented by the City Council or any delegate acting within the scope of its jurisdiction. 14.60.047 "Gross Annual Receipts" means the annual gross revenues received by the Grantee from all sources of operations of the Cable Communications System, excluding refundable depo- sits, except that any sales, excise or other taxes collected for direct pass- through to local, State or Federal government shall not be included. 14.60.048 "Initial Service Area" means the area of the City which will receive service initially, as set forth in the Fran- chise Agreement. 14.60.049 "Installation" means the connection of the system I�k"' from feeder cable to subscribers' terminals, and the provision of service. 14.60.050 "Local Origination Channel" means any channel where the Grantee or its designated agent is the primary program- mer, and provides video programs to subscribers. 14.60.051 "Pay - Cable ", "Pay- Television" or "Pay -per- View" means the delivery to subscribers, over the Cable Communications System, of television signals fo a fee or charge to subscribers over and above the charge for Basic Cable Service, on a per program, per channel, or other subscription basis. 14.60.052 "Person" means an individual, partnership, asso- ciation, joint stock company, trust, corporation, or organiza- tional entity. 14.60.053 "Programmer" means a person or entity who or which produces or otherwise provides program material or informa- tion for transmission by video, audio, digital, or other signals, either live or from recorded tapes or other storage media, to subscribers, by means o£,the Cable Communications System. 14.60.054 "Public. Educational or Government Access Facili- ties" or "PEG Access Facilities" means the total of the follow- ing: 8 (a) Channel capacity designated for public, educational, or governmental use; and �ftr (b) Facilities and equipment for the use of such channel capacity. I%W 14.60.055 "Resident" means any person residing in the City as otherwise defined by applicable law. 14.60.056 "School" means any accredited nonprofit educa- tional institution including primary and secondary schools, Colleges and universities, both public and private. 14.60.057 "Section" means any section, subsection, or provision of this franchise ordinance. 14.60.058 "Service Area" or "Franchise Area" means the entire geographic area within the City designated in a Franchise Agreement to receive cable service. 14.60.059 "Service Tier" means a category of cable service or other services provided by a Grantee and for which a separate rate is charged by the Grantee. 14.60.060 "State" means the State of California. 14.60.061 "Street" means each of the following which have been dedicated to the public or hereafter dedicated to the public and maintained under public authority or by others and located within the City limits: streets, roadways, highways, avenues, lanes, alleys, sidewalks, easements, rights -of -way and similar public property and areas that the Grantor shall permit to be included within the definition of street from time to time. 14.60.062 "Subscriber" means any person, firm, corporation, or other entity who or which elects to subscribe to, for any purpose, a service provided by the Grantee by means of or in connection with the Cable Communications System. E SECTION 14.60.070. GRANT OF FRANCHISE 14.60.071 Grant. In the event that Grantor shall grant to a Grantee a nonexclusive, revocable franchise to construct, ope- rate, maintain, and reconstruct, a Cable Communications System within the franchise area, or a renewal of an existing franchise, said franchise shall constitute both a right and an obligation to provide the services of a Cable Communications System as required by the provisions of this ordinance and the Franchise Agreement. The Franchise Agreement shall include those provisions of the Grantee's "Application for Franchise" that are finally negotiated and accepted by the Grantor and Grantee. Any franchise granted under the terms and conditions con- tained herein shall be consistent with Federal laws and regula- `"' tions and State general laws and regulations. In the event of conflict between the terms and conditions of the franchise and the terms and conditions on which the Grantor can grant a fran- chise, the general law and /or statutory requirements shall, without exception, control. Any franchise granted is hereby made subject to the general ordinance provisions now in effect or hereafter made effective. Nothing in the franchise shall be deemed to waive the require- ments of the other codes and ordinances of the Grantor regarding permits, fees to be paid or manner of construction. 1%W 14.60.072 Franchise Required. No Cable Communications System shall be allowed to occupy or use the streets in the franchise area or be allowed to operate without a franchise in accordance with the provisions of this ordinance. 14.60.073 Establishment of Franchise Requirements. The Grantor may establish appropriate requirements for new franchises or franchise renewals, and may modify these requirements from time to time to reflect changing conditions and state of art in the cable industry. Such requirements shall not be retroactive to franchises then in effect, except as set forth in Section 14.60.082, but shall become applicable when the franchise is renewed. 10 `W �Ar 14.60.074 Authority to Grant Franchise. The Grantor may grant a franchise for all or any defined portion of the City. The service area shall be the entire area defined in the Fran- chise Agreement. The initial service area shall be that portion of the franchise area scheduled to receive initial service, as stated in the Franchise Agreement. 14.60.075 Use of Public Streets and Ways. For the purpose of operating and maintaining a Cable Communications System in the franchise area, and subject to the provisions of Section 14.60.120 herein, the Grantee may erect, install, construct, repair, replace, reconstruct, and retain in, on, over, under, upon, across, and along the public streets and ways within the franchise area such wires, cables, conductors, ducts, conduits, vaults, manholes, amplifiers, appliances, pedestals, attachments, and other property and equipment as are necessary and appurtenant to the operation of the Cable Communications System. Prior to construction or alteration, however, the Grantee shall in each case file plans with the appropriate Grantor agencies and local utility companies, and receive written approval before proceed- ing. Grantee shall in any event comply with all applicable Grantor construction codes and procedures. 14.60.076 Duration. The term of any new franchise and all rights, privileges, obligations and restrictions pertaining thereto shall be as established in the Franchise Agreement, unless terminated sooner as hereinafter provided. 14.60.077 Franchise Nonexclusive. Any franchise granted shall be nonexclusive. The Grantor specifically reserves the right to grant, at any time, such additional franchises for a Cable Communications System as it deems appropriate, provided however, that such additional grants shall not operate to mate- rially modify, revoke or terminate any rights previously granted to any Grantee. 14.60.078 New Franchise Applications. Applicants for a new franchise shall submit to the Grantor written applications uti- lizing the standardized format provided by the Grantor, at the 11 time and place designated by the Grantor for accepting applica- tions, and including the application fees designated by Grantor. fib. 4.9 Grant Procedure. All new franchise applications when filed shall be available for public inspection at places desig- nated by the Grantor. No later than ninety (90) days after the final date for filing applications, one or more public hearings shall be held on the applications. A decision shall be made by the Grantor not later than ninety (90) days after the conclusion of all such public hearings based upon an evaluation of the application(s), the hearings, and other information that the Grantor may deem relevant. Grantor may grant one or more fran- chises, or may decline to grant any franchise. 14.60.080 Transfer of Ownership or Control. (a) Transfer of Franchise. Any franchise granted hereunder shall be a privilege to be held for the benefit of the public. Said franchise cannot in any event be sold, transferred, leased, assigned or disposed of, including but not limited to, by forced or voluntary sale, merger, consolidation, receivership, or other means without the prior written consent of the Grantor, and then only under such reasonable conditions as the Grantor may establish. Such consent as required by the Grantor shall be given or denied no later than ninety (90) days following any request, and shall not be unreasonably withheld. %r (b) Ownership or Control. The Grantee shall promptly notify in writing the Grantor of any proposed change in, or transfer of, or acquisition by any other party of, control of the Grantee. The word "control" as used herein is not limited to major stockholders but includes actual working control in what- ever manner exercised. A rebuttable presumption that a transfer of control has occurred shall arise upon the acquisition or transfer by any person or group of persons of ten percent (10 %) or more of the beneficial ownership interest of the Grantee. Every change, transfer, or acquisition of control of the Grantee shall make the franchise subject to cancellation unless and until `'' the Grantor shall have consented in writing thereto, which con- 12 sent shall be given or denied no later than ninety (90) days following any request, and shall not be unreasonably withheld. For the purpose of determining whether it shall consent to such change, transfer or acquisition of control, the Grantor may inquire into the qualifications of the prospective controlling party, and the Grantee shall assist the Grantor in any such inquiry. In seeking the Grantor's consent to any change in ownership or control, the Grantee shall have the responsibility: (1) To show to the satisfaction of the Grantor whether the proposed purchaser, transferee, or assignee (the "proposed transferee "), which in the case of a corporation, shall include all directors and all persons having a legal or `V equitable interest in five percent (5 %) or more of its voting stock: a. Has ever been convicted of any felonious acts including, but not limited to any violation of Federal, State or local law or regulations, or is presently under an indictment, investigation or complaint charging such acts; b. Has ever had a judgment in an action for fraud, deceit or misrepresentation entered against it, her, him, or them by any court of competent jurisdiction; or C. Has pending any legal claim, �4r lawsuit or administrative proceeding arising out of or involving a cable system. (2) To establish, to the satisfaction of the Grantor, the financial solvency of the proposed transferee by submitting all current financial data for the proposed transferee which the Grantee was required to submit in its franchise appli- cation and such other data as the Grantor may request. Financial statements shall be audited, certified and qualified by a Certi- fied Public Accountant or a financial officer of the proposed transferee. (3) To establish to the satisfaction of the %4' Grantor that the financial and technical capability of the pro- 13 posed transferee is such as shall enable it to maintain and operate the cable system for the remaining term of the franchise under the existing franchise terms. (c) The Grantor agrees that any financial insti- tution having a pledge of the franchise or its assets for the advancement of money for the construction and /or operation of the franchise shall have the right to notify the Grantor that it or its designee satisfactory to the Grantor shall take control and operate the Cable Communications System, in the event of a Grantee default in its financial obligations. Further, said financial institution shall also submit a plan for such operation that will insure continued service and compliance with all fran- chise requirements during the term the financial institution fir► exercises control over the system. The financial institution shall not exercise control over the system for a period exceeding one (1) year unless extended by the Grantor in its discretion and during said period of time it shall he the right to petition the Grantor to transfer the franchise to another Grantee. If the Grantor finds that such transfer after considering the legal, financial, character, technical and other public interest qual- ities of the applicant are satisfactory, the Grantor shall trans- fer and assign the rights and obligations of such franchise as in the public interest. The consent of the Grantor to such transfer shall be given or denied no less than ninety (90) days after any request, and shall not be unreasonably withheld. �W (d) The consent or approval of the Grantor to any transfer by the Grantee shall not constitute a waiver or release of the rights of the Grantor in and to the streets, and any transfer shall by its terms, be expressly subject to the terms and conditions of any franchise. (e) In the absence of extraordinary circum- stances, the Grantor shall not approve any transfer or assignment of the franchise prior to completion of initial construction of the cable system. 14 (f) In no event shall a transfer of ownership or control be approved without the successor in interest becoming a 14W signatory to the Franchise Agreement. 14.60.081 Franchise Renewal. Franchise renewal shall be as prescribed by applicable law. 14.60.082 Police Powers. In accepting a franchise, the Grantee acknowledges that its rights hereunder are subject to the police powers of the Grantor to adopt and enforce general ordi- nances necessary to the safety and welfare of the public; and it agrees to comply with all applicable general laws and ordinances enacted by the Grantor pursuant to such power. Any conflict between the provisions of this ordinance and any other present or future lawful exercise of the Grantor's 1%W police powers shall be resolved in favor of the latter, except that any such exercise that is not of general application in the jurisdiction or applies exclusively to any Cable Communications System franchise which contains provisions inconsistent with this ordinance shall prevail only if upon such exercise the Grantor finds an emergency exists constituting a danger to health, safety, property or general welfare or such exercise is mandated by law. 14.60.083 Franchise Fee. (a) Annual Franchise Payment. A Grantee of a franchise hereunder shall pay to the Grantor an annual fee in an amount as designated in the Franchise Agreement. Such payment shall commence as of the effective date of the franchise or any renewal date. The Grantor, on an annual basis, shall be fur- nished a statement within sixty (60) days of the close of the calendar year, either audited and certified by an independent Certified Public Accountant or certified by a financial officer of the Grantee, reflecting the total amounts of gross receipts and all payments, deductions and computations for the period covered by the payment. Upon ten (10) days prior written notice, Grantor shall have the right to conduct an independent audit of `` Grantee's records, in accordance with Generally Accepted Account- 15 ing Procedures, and if such audit indicates a franchise fee underpayment of two percent (2%) or more, the Grantee shall assume all reasonable costs of such an audit. (b) Acceptance by Grantor. No acceptance of any payment by the Grantor shall be construed as a release or as an accord and satisfaction of any claim the Grantor may have for further or additional sums payable as a franchise fee under this ordinance or for the performance of any other obligation of the Grantee. (c) Failure to Make Required Payment. In the event that any franchise payment or recomputed amount is not made on or before the dates specified herein, Grantee shall pay as additional compensation: `" (1) An interest charge, computed from such due date, at an annual rate equal to the average rate of return on invested funds of the City during the period for which payment was due. (2) If the payment is late by forty -five (45) days or more, a sum of money equal to five percent (5%) of the amount due in order to defray those additional expenses and costs incurred by the Grantor by reason of delinquent payment. (d) Franchise fee payments shall be made in accordance with the schedule indicated in the Franchise Agree- ment. (e) Any Grantee itemization of franchise fee costs on subscribes' bills shall be in accordance with Federal law. If Grantee elects to indicate the franchise fee as a sep- arate item, it shall also itemize, as a minimum, the five cost items representing the largest recurring operational costs to Grantee. 14.60.084 Forfeiture or Revocation. (a) Grounds for Revocation. If the Grantee has been given due notice and a reasonable opportunity to cure, the Grantor reserves the right to revoke any franchise granted here- under and rescind all rights and privileges associated with the 16 franchise in the following circumstances, each of which shall represent a default under this ordinance and a material breach of 1Ar the franchise: (1) If the Grantee shall default in the performance of any of its material obligations under this ordi- nance or under such documents, agreements and other terms and provisions entered into by and between the Grantor and the Grantee, subject to the provisions of Section 14.60.173. (2) If the Grantee should fail to provide or maintain in full force and effect, the liability and indemni- fication coverages or the security fund or bonds as required herein. (3) If any court of competent jurisdiction, 14' or any Federal or State regulatory body by rules, decisions or other action determines that any material provision of the fran- chise documents, including this ordinance, the Franchise Agree- ment and Grantee's proposal is invalid or unenforceable prior to the commencement of initial system construction. (4) If the Grantee ceases to provide all services for any reason within the control of the Grantee over the Cable Communications System. (5) If the Grantee willfully violates any of the material provisions of this ordinance or the Franchise %W Agreement or attempts to practice any fraud or deceit upon the Grantor. (6) If the Grantee becomes insolvent, or upon listing of an order for relief in favor of Grantee in a bankruptcy proceeding. (b) Procedure Prior to Revocation. (1) The Grantor may make written demand that the Grantee comply with any such requirement, limitation, term, condition, rule or regulation or correct any action deemed cause for revocation. In the event the stated violation is not reasonably curable within ninety (90) days, the franchise shall not be terminated or revoked, or damages assessed, if the Grantee 17 provides within the said ninety (90) days a plan, satisfactory to the Grantor, to remedy the violation. If the failure, refusal or �tr neglect of the Grantee continues for a period exceeding ninety (90) days following receipt of such written demand by the Grantor, the Grantor may place its request for termination of the franchise upon a regular Council meeting agenda. The Grantor shall cause notice to be served upon such Grantee, at least twenty (20) days prior to the date of such meeting, a written notice of this intent to request such termination, and the time and place of the meeting, notice of which shall be published at least once, ten (10) days before such meeting in a newspaper of general circulation within the franchise area. (2) The Grantor shall hear any persons �N' interested therein, and shall determine, within ninety (90) days, based upon the preponderance of the evidence, whether the Grantee has committed a material breach of this ordinance or the Fran- chise Agreement, and, if so, whether such breach was willful. (3) If the Grantor determines that the Grantee has willfully committed a material breach, then the Grantor may, by resolution, declare that the franchise of such Grantee shall be terminated and security fund and bonds for- feited, or the Grantor may, at its option and if the material breach is capable of being cured by the Grantee, direct the �kw Grantee to take appropriate remedial action within such time and manner and upon such terms and conditions as the Grantor shall determine are reasonable under the circumstances. tion. 14.60.085 Procedures in the Event of Termination or Expira- (a) Disposition of Facilities. In the event a franchise expires, is revoked, or otherwise terminated, the Grantor may order the removal of the above - ground system facili- ties from the franchise area within a reasonable period of time as determined by the Grantor or require the original Grantee to maintain and operate its cable system for a period not to exceed %%' twenty -four (24) months as indicated in (d) below. 18 (b) Restoration of Property. In removing its plant, structures, and equipment, the Grantee shall refill, at *r► its own expense, any excavation that shall be made by it and shall leave all public ways and places in as good condition as that prevailing prior to the Grantee's removal of its equipment without affecting the electrical or telephone cable wires, or attachments. The liability, indemnity and insurance, and the security fund and bonds provided shall continue in full force and effect during the period of removal and until full compliance by the Grantee with the terms and conditions of this Section. (c) Restoration Grantor, Reimbursement of Costs. In the event of a failure by the Grantee to complete any work required by Subsection (a) above and /or Subsection (b) above, or �k' any other work required by Grantor by law or ordinance, within ninety (90) days after receipt of written notice, and to the satisfaction of the Grantor, the Grantor may cause such work to be done and the Grantee shall reimburse the Grantor the cost thereof within thirty (30) days after receipt of an itemized list of such costs or the Grantor may recover such costs through the security fund or bonds provided by Grantee. The Grantor shall be permitted to seek legal and equitable relief to enforce the provisions of this Section. (d) Extended Operation. Upon either the expira- %W tion or revocation of a franchise, the Grantor may require the Grantee to continue to operate the Cable Communications System for a defined period of time not to exceed twenty -four (24) months from the date of such expiration or revocation. The Grantee shall, as trustee for its successor in interest, continue to operate the Cable Communications System under the terms and conditions of this ordinance and the Franchise Agreement and to provide the regular cable service and any of the other services that may be provided at that time. The Grantor shall be per- mitted to seek legal and equitable relief to enforce the provi- sions of this Section. 19 (e) Grantor's Right Not Affected. The termina- tion and forfeiture of any franchise shall in no way affect any *%W of the rights of the Grantor under any provision of law. 14.60.086 Receivership and Foreclosure. (a) Any franchise granted shall, at the option of the Grantor, cease and terminate one hundred twenty (120) days after the appointment of a receiver or receivers or trustee or trustees to take over and conduct the business of the Grantee whether in a receivership, reorganization, bankruptcy or other action or proceeding unless such receivership or trusteeship shall have been vacated prior to the expiration of said one hundred twenty (120) days, or unless: (1) Such receivers or trustees shall have, �W within one hundred twenty (120) days after their election or appointment, fully complied with all the terms and provisions of this ordinance and the franchise granted pursuant hereto, and the receivers or trustees within said one hundred twenty (120) days shall have remedied all defaults under the franchise; and, (2) Such receivers or trustees shall, within said one hundred twenty (120) days, execute an agreement duly approve by the court having jurisdiction on the premises, whereby such receivers or trustees assume and agree to be bound by each and every term, provision and limitation of the Franchise �M► Agreement. �r (b) In the case of a foreclosure or other invol- untary sale of the plant, property and equipment of the Grantee, or any part thereof, the Grantor may serve notice of termination upon the Grantee and to the purchaser at such sale, in which event the franchise and rights and privileges of the Grantee hereunder shall cease and terminate thirty (30) days after ser- vice of such notice, unless: (1) The Grantor shall have approved the transfer of the franchise, as and in the manner in this ordinance provided; and, 20 (2) Such successful purchaser shall have covenanted and agreed with the Grantor to assume and be bound by all the terms and conditions of the Franchise Agreement. 14.60.087 Franchise Processing Costs. For either a new franchise award, franchise renewal or transfer, costs to be borne by the Grantee which receives the new franchise award, renewal or transfer, shall include, but shall not be limited to, all costs of publications of notices prior to any public meeting provided for pursuant to a franchise, development and publication of relevant ordinances and Franchise Agreement, fees, and any cost not covered by the application fees, incurred by the Grantor in its study, preparation of proposal solicitation documents, eval- uation of all applications, including, but not limited to consul - �W tant and attorney fees. fir. These franchise processing costs are over and above the construction inspection and permit fees specified in Section 14.60.121(a)(1) and the franchise fee specified in Section 14.60.083 herein. 21 SECTION 14.60.090. REGULATION OF FRANCHISE 14.60.091 Regulatory Authority. The Grantor shall exercise `r regulatory authority under the provisions of this ordinance and applicable law. If the franchise area served by the Cable Com- munications System also serves other contiguous or neighboring communities, Grantor may, at its sole option, participate in a joint regulatory agency, with delegated responsibility in the area of cable and related communications. 14.60.092 Preemption of Regulatory Authority. If any areas of local regulatory authority are preempted by state, federal or judicial action, and such preemption is later lifted and no longer in effect, the Grantor shall have the authority to reas- sert regulation at any time thereafter, so long as such regula- `'` tion is not in conflict with the provisions of any existing Franchise Agreement. `. 14.60.093 Regulatory Responsibility. The Grantor, acting alone or acting jointly with other Grantors, may exercise or delegate the following regulatory responsibility: (a) Administering and enforcing the provisions of the Cable Communications System franchise(s). (b) Coordination of the operation of Public, Educational and Government (PEG) Access channel and facilities. (c) Providing technical, programming and opera- tional support to public agency users, such as government depart- ments, schools and health care institutions. (d) Establishing jointly with the Grantee, or as otherwise specified in the Franchise Agreement, procedures and standards for use of channels dedicated to public use and sharing of public facilities, if provided for in any Franchise Agreement. (e) Planning expansion and growth of public benefit cable services. (f) Analyzing the possibility of integrating cable communications with other local, State or national telecom- munications networks. 22 1%W L (g) Formulating and recommending long -range telecommunications policy. 14.60.094 Public Usage of the System. If so specified in the Franchise Agreement, the Grantor may utilize a portion of the Cable Communications System capacity, and associated facilities and resources, to develop and provide non - commercial cable ser- vices that will be in the public interest. In furtherance of this purpose, the Grantor may establish a commission, public corporation, or other entity to receive and allocate facilities, support funds and other considerations provided by the Grantor, the Grantee, and /or others. Such an entity, if established, may be delegated the following responsibilities: (a) Receive and utilize or reallocate for utili- zation, channel capacity, facilities, funding and other support provided specifically for public usage of the Cable Communica- tions System. (b) Review the status and progress of each service developed for public benefit. (c) Reallocate resources jointly with the Grantee on a periodic basis to conform with changing priorities and public needs. (d) Report to the Grantor and the Grantee annually on the utilization of resources, the new public services developed and the benefits achieved for the Grantor and its residents. 14.60.095 PEG Access Facility Management. (a) Intent. It is the intent of the Grantor to insure that PEG Access Facilities provided for in any Franchise Agreement shall be managed in the best public interest so that programming using such facilities will be open to all residents, and available for all forms of public expression, community information and debate of public issues. Pursuant to these objectives, the Grantor may delegate the responsibility for PEG 23 Access Facility management to a nonprofit entity which may include, but not be limited to, any of the following: �Nr (1) A nonprofit public corporation. (2) A PEG Access Facility management com- mission or committee, appointed by Grantor, and representing a broad spectrum of the community. (3) An established nonprofit entity with special cablecasting capability, such as a local or regional community college. (b) Functions. The entity designated to manage the PEG Access Facilities shall have the following functions: (1) Responsibility for program production for and management of the Public Access Facilities as may in the fir Franchise Agreement be designated for community -based program- ming. community channels may include Public, Educational and Government Access channels, as designated in the Franchise Agree- ment. (2) To assure that the PEG Access Facili- ties are made to all residents of the franchise area on a non- discriminatory, first -come, first - served basis. (3) To assure that no censorship or control over program content of the PEG Access Facilities exists except as necessary to comply with federal prohibition of material that is illegal. (4) To devise, establish, and administer all rules, regulations, and procedures pertaining to the use and scheduling of the PEG Access Facilities. (5) To prepare, in conjunction with the Grantee, such regular or special reports as may be required or desirable. (6) To hire and supervise staff. (7) To make all purchases of materials and equipment that may be required. %W 24 (8) To develop sources of funding, such as foundation or Federal or State grants, to further community programming. (9) To perform such other functions rele- vant to the PEG Access Facilities as may be appropriate. (10) Establishment of budgets on an annual basis, and utilization of funds and resources received from the Grantor or the public usage entity designated in Section 14.60.094, for the purpose of PEG Access programming. (c) Access Rules. The PEG Access Facility man- agement entity shall complete a set of rules for the use of the PEG Access facilities which shall be promptly forwarded to the Grantor. The rules shall be prepared in cooperation with the �Mw Grantee, and confirmed by agreement between the PEG Access Facil- ity management entity and the Grantee. The rules shall, at a minimum, provide for: (1) Access on a first -come, first - served, nondiscriminatory basis for all residents of the franchise area. (2) Prohibition of commercial use by public access programming producers. obscene material. (3) Prohibition of any presentation of (4) Public inspection of the log of pro- �kw ducers, which shall be retained by the PEG Access Facility man- agement entity for a period of four (4) years. (5) Procedures by which individuals or groups who violate any rule may be prevented from further access to the facilities. (6) Free use of such reasonable amounts of channel time, cablecasting facilities, and technical support as are provided for in the agreement between the PEG Access Facility management entity and the Grantee. (d) PEG Access Facility Management Entity Reports to Grantor. The PEG Access Facility management entity shall provide a report to the Grantor and the Grantee, at least 25 annually, indicating achievements in community -based programming and services. 14.60.096 Reservation by Grantor. The Grantor reserves the right, at its discretion, from time to time, to determine if the entities described in Sections 14.60.094 and 14.60.095 above are performing their purposes in a manner satisfactory to the Grantor, and if they are not, the Grantor may receive and reallo- cate all or a portion of the channel capacity, operations appro- priation, and capital appropriation, including any facilities and equipment purchased previously with such appropriation, to another entity. A new entity shall be required to comply in all respects with the legal responsibilities described in Sections 14.60.094 and 14.60.095. %W 14.60.097 Rates. The Grantee shall establish rates for its services that must be applied fairly and uniformly to all sub- scribers in the franchise area. The Grantor retains the right to institute rate regulation to the extent permitted by applicable law. 14.60.098 Annual Review of Performance and Quality of Service. At Grantor's sole option, within ninety (90) days of the first anniversary of the effective date of each franchise, and each year thereafter throughout the term of the franchise, the Grantor may hold a public hearing at which the Grantee shall `W be present and shall participate, to review the performance and quality of service of the Cable Communications System. The reports required in Sections 14.60.180 - 14.60.191 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 comments or complaints during the review meetings, either orally or in writing, and these shall be considered. (a) Within thirty (30) days after the conclusion of the public hearing, Grantor shall issue a report with respect to system performance and quality of service. If areas of fran- MM chise noncompliance are found, Grantor may direct Grantee to correct the noncompliance within a reasonable period of time. �W (b) Failure of Grantee, after due notice, to correct the noncompliance shall be considered a breach of the franchise, and Grantor may, at its sole discretion, exercise any remedy within the scope of this ordinance considered appropriate. 14.60.099 System and Services Review. To provide for tech- nological, economic, and regulatory changes in the state of the art of cable communications, to facilitate renewal procedures, to promote the maximum degree of flexibility in the cable system, and to achieve a continuing, advanced modern system, the follow- ing system and services review procedures are hereby established: (a) At Grantor's sole option, the Grantor may �kw hold a public hearing on or about the fifth (5th) anniversary date of the Franchise Agreement at which the Grantee shall be present and shall participate, to review the cable communications system and services. Subsequent system and services review hearings may be scheduled by the Grantor each five (5) years thereafter. (b) Sixty (60) days prior to the scheduled system and services review hearing, Grantee shall submit a report to Grantor indicating the following: (1) All cable system services reported in �kr cable industry trade journals that are being commonly provided on an operational basis, excluding tests and demonstrations, to com- munities in the United States with comparable populations, that are not provided to the Grantor. (2) Any specific plans for provision of such new services by the Grantee, or a justification indicating why Grantee believes that such services are not feasible for the franchise area. (c) Topics for discussion and review at the system and services review hearing shall include but shall not be limited to, services provided, feasibility of providing new ~ services, application of new technologies, system performance, 27 programming, subscriber complaints, user complaints, rights or privacy, amendments to the franchise, undergrounding processes, fir► developments in the law, and regulatory constraints. (d) Either the Grantor or the Grantee may select additional topics for discussion at any review hearing. (e) Not later than sixty (60) days after the conclusion of each system and service review hearing, Grantor shall issue a report, including specifically a listing of any cable services not then being provided to the Grantor that are �kl• r`v considered technically and economically feasible. Grantor may request Grantee to provide such services within a reasonable time, under reasonable rates and conditions. 28 SECTION 14.60.100. GENERAL FINANCIAL AND INSURANCE PROVISIONS 14.60.101 Construction Bond. 141r► (a) Within thirty (30) days after the granting of a new franchise, or a renewal which requires significant system construction, and prior to the commencement of any con- struction work by the Grantee, the Grantee shall file with the Grantor a construction bond in the amount specified in the Fran- chise Agreement in favor of the Grantor and any other person who may claim damages as a result of the breach of any duty by the Grantee assured by such bond. (b) Such bond as contemplated herein shall be in the form approved by the Grantor and shall, among other matters, cover the cost of removal of any properties installed by the VN" Grantee in the event said Grantee shall default in the perform- ance of its franchise obligation. (c) In no event shall the amount of said bond be construed to limit the liability of the Grantee for damages. (d) Grantor, at its sole option, may waive this requirement, or permit consolidation of the construction bond with the performance bond and security fund specified, respec- tively in Sections 14.60.102 and 14.60.103. (e) Upon completion of construction, any con- struction bonds then in force shall be released. Iftw 14.60.102 Performance Bond. (a) In addition to the construction bond set forth above, the Grantee may be required, at least thirty (30) days prior to the commencement of operation, to file with the Grantor a performance bond in the amount specified in the Fran- chise Agreement in favor of the Grantor and an other person who may be entitled to damages as a result of any occurrence in the operation or termination of the Cable Communications System operated under the Franchise Agreement and including the payments required to be made to the Grantor hereunder. (b) Such bond as contemplated herein shall be in �Mr the form approved by the Grantor and shall among other matters 29 cover the cost of removal of any properties installed by the Grantee in the event said Grantee shall default in the perform- %W ance of its franchise obligation. (c) In no event shall the amount of said bond be construed to limit the liability of the Grantee for damages. (d) Grantor, at its sole option, may waive this requirement, or permit consolidation of the performance bond with the construction bond and security fund specified, respectively in Sections 14.60.101 and 14.60.103. 14.60.103 Security Fund. (a) Within thirty (30) days after the effective date of the franchise, the Grantee shall deposit into a bank account, established by the Grantor and maintain on deposit 164 through the term of this franchise, the sum specified in the Franchise Agreement, as security for the faithful performance by it of all the provisions of the franchise, and compliance with all orders, permits and directions of any agency of the Grantor having jurisdiction over its acts or defaults under this ordi- nance, and the payment by the Grantee of any claims, liens and taxes due the Grantor which arise by reason of the construction, operation or maintenance of the system. Subject to the provisions of (d) below, the security fund may be assessed by the Grantor for purposes includ- ing, but not limited to, the following: (1) Failure of Grantee to pay Grantor sums due under the terms of the franchise. (2) Reimbursement of costs borne by the Grantor to correct franchise violations not corrected by Grantee, after due notice. (3) Monetary remedies or damages assessed against Grantee due to default or violation of franchise require- ments. (b) At Grantor's sole option, some portion of the security fund may be provided in the acceptable form of an irrevocable letter of credit, in lieu of a cash deposit. BE (c) Within thirty (30) days after notice to it that any amount has been withdrawn by the Grantor from the secur- `4W ity fund pursuant to Subsection (a) of this Section, the Grantee shall deposit a sum of money sufficient to restore such security fund to the amount required by the Franchise Agreement. (d) If the Grantee fails, after thirty (30) days written notice to pay to the Grantor any franchise fee or taxes due and unpaid; or, fails to pay to the Grantor within such thirty (30) days, any damages, costs or expenses which the Grantor shall be compelled to pay by reason of any act or default of the Grantee in connection with the franchise; or fails, after thirty (30) days notice of such failure by the Grantor to comply with any material provision of the franchise which the Grantor �kw reasonably determines can be remedied by an expenditure of the security fund, the Grantor may thereafter withdraw the amount thereof, with interest and any penalties, from the security fund. Upon such withdrawal, the Grantor shall notify the Grantee of the amount and date thereof. (e) The security fund deposited pursuant to this Section shall become the property of the Grantor in the event that the franchise is revoked for cause by reason of the default of the Grantee in accordance with the procedures of Section 14.60.084 above. The Grantee, however, shall be entitled to the �kw return of such security fund, or portion thereof, as remains on deposit no later than ninety (90) days after the expiration of the term of the franchise, provided that there is then no out- standing default on the part of the Grantee. The Grantee shall be entitled to any interest accrued on the cash portion of the security fund. (f) The rights reserved to the Grantor with respect to the security fund are in addition to all other rights of the Grantor whether reserved by this ordinance or authorized by law, and no action, proceeding or exercise of a right with respect to such security fund shall constitute an election of ,%. remedies or a waiver of any other right the Grantor may have. 31 14.60.104 Indemnification. (a) The Grantee shall by acceptance of any franchise granted indemnify, defend and hold harmless the Grantor, its officers, boards, commissions, agents, and employees from any and all claims, suits, judgments for damages or other relief, costs and attorneys' fees in any way arising out of or through or alleged to arise out of or through: franchise; and (1) The act of the Grantor in granting the (2) The acts or omissions of Grantee, its servants, employees, or agents including, but not limited to, any failure or refusal by Grantee, its servants, employees or agents to comply with any obligation or duty imposed on Grantee by this 1#4' ordinance or the Franchise Agreement. (3) The exercise of any right or privilege granted or permitted by this ordinance or the Franchise Agree- ment. Such indemnification shall include, but not be limited to, all claims arising in tort, contracts, infringements of copy- right, violations of statutes, ordinances or regulations or otherwise. (b) In the event any such claims shall arise, the Grantor or any other indemnified party shall tender the defense thereof to the Grantee. Provided, however, that the %r Grantor in its sole discretion may participate in the defense of such claims at its expense, and in such event, Grantee shall not agree to any settlement of claims without Grantor approval. `w (c) The Grantee shall not be required to indem- nify the Grantor for negligence or willful misconduct on the part of Grantor's officials, boards, commissions, agents or employees. 14.60.105 Insurance. (a) The Grantee shall maintain throughout the term of the franchise insurance in amounts at least as follows: (1) Worker's Compensation Insurance. In such coverage as may be required by the worker's compensation 32 insurance and safety laws of the State of California and amend- ments thereto. (2) Comprehensive General Liability. Comprehensive general liability insurance, including, but not limited to, coverage for bodily injury and property damage shall be maintained at the sum(s) specified in the Franchise Agreement. (3) Comprehensive Automobile Liability. Comprehensive automobile liability including, but not limited to, nonownership and hired car coverage as well as owned vehicles with coverage for bodily injury and property damage shall be maintained at the sum(s) specified in the Franchise Agreement. (b) The Grantee shall furnish the Grantor with copies of such insurance policies or certificates of insurance. �kw (c) Such insurance policies provided for herein shall name the Grantor, its officers, boards, commissions, agents, and employees as additional insured, and shall be primary to any insurance carried by Grantor, and shall contain the fol- lowing endorsement; or one substantially similar: "It is hereby understood and agreed that this insurance policy may not be cancelled by the surety or the inten- tion not to renew be stated by the surety until thirty (30) days after receipt by the City by registered mail or written notice of such intention to cancel or not renew." `r (d) The minimum amounts set forth in the Fran- chise Agreement for such insurance shall not be construed to limit the liability of the Grantee to the Grantor under the franchise issued hereunder to the amounts of such insurance. (e) All insurance carriers providing coverage under (a) above shall be duly licensed to operate in the State of California. 1r► 33 SECTION 14.60.110. DESIGN AND CONSTRUCTION PROVISIONS 14.60.111 System Design. The Cable Communications System shall be constructed in accordance with the design requirements contained in the Franchise Agreement. 14.60.112 Geographical Coverage. The Grantee shall design and construct the cable system in such a manner as to have the capability to pass by every single - family dwelling unit, mul- tiple- family dwelling unit, school and public agency within the franchise area. Service shall be provided to subscribers in accordance with the schedules and line extension policies speci- fied in the Franchise Agreement. Cable system construction and provision of service shall be non - discriminatory, and Grantee shall not delay or defer service to any section of the franchise 1Ar area on the grounds of economic preference. 14.60.113 Cablecasting Facilities. The Grantee shall provide cablecasting facilities in accordance with the require- ments of the Franchise Agreement. 14.60.114 System Construction Schedule. (a) The Grantee shall comply with the require- ments of the system construction schedule contained in the Fran- chise Agreement. (b) As required by the Franchise Agreement, the Grantee shall provide a detailed construction plan indicating k%► progress schedule, area construction maps, test plan, and pro- jected dates for offering service. In addition, the Grantee shall update this information on a monthly basis, by submitting a copy of its normal internal progress reports, showing specifi- cally whether schedules are being met and the reasons for any delay. 14.60.115 Remedies for Delay in Construction. The Grantor may at its sole option, apply any or all of the remedies in connection with delays in system construction as specified in Section 14.60.170 herein. 14.60.116 Provision of Service. After service has been �t" established by activating trunk and distribution cables for any 34 area, the Grantee shall provide service to any requesting sub- scriber within that area within thirty (30) days from the date of request. 14.60.117 Undergrounding of Cable. The undergrounding of cable is encouraged. In any event, cables shall be installed underground at Grantee's cost where utilities are already under- ground, or where required by law. Previously installed aerial cable shall be undergrounded and relocated in concern with other utilities, when such other utilities convert from aerial to underground construction. 14.60.118 New Development Undergrounding. In cases of new construction or property development where utilities are to be placed underground, upon request by the Grantee, the developer or property owner shall give Grantee at least seventy -two (72) hours notice of the particular date on which open trenching will be available for Grantee's installation of conduit, pedestals and /or vaults to be provided at Grantee's expense. Grantee shall also provide specifications as needed for trenching. Costs of trenching and easements required to bring service to the development shall be borne by the developer or property owner; except that if Grantee fails to install its conduit, pedestals and /or vaults within five (5) working days of the date of the trenches are available, as designated in the notice given 1%. by the developer or property owner, then should the trenches be closed after the five (5) day period, the cost of new trenching is to be borne by Grantee. 14.60.119 Underground at Multiple - Dwelling Units. In cases of multiple dwelling units serviced by aerial utilities, Grantee shall make every effort to minimize the number of individual aerial drop cables giving preference to undergrounding of mul- tiple drop cables between the pole and the dwelling unit. 14.60.120 Street Occupancy. (a) Grantee shall utilize existing poles, con- duits and other facilities whenever possible and economically �Nl• feasible, and shall not construct or install any new, different, 35 or additional poles, conduits, or other facilities whether on public property or on privately -owned property until the written approval of the Grantor is obtained. (b) Grantee shall notify the Grantor at least ten (10) days prior to the intention of the Grantee to commence any construction in any streets. The Grantor shall cooperate with the Grantee in granting any permits required, providing such grant and subsequent construction by the Grantee shall not unduly interfere with the use of such streets and that proposed con- struction shall be done in accordance with the pertinent pro- visions of the ordinances of the Grantor. (c) All transmission lines, equipment and struc- ture shall be so installed and located as to cause minimum inter- �k" ference with the rights and reasonable convenience of property owners and at all times, shall be kept and maintained in a safe, adequate and substantial condition, and in good order and repair. The Grantee shall, at all times, employ ordinary care and shall install and maintain in use commonly accepted methods and devices for preventing failures and accidents which are likely to cause damage, injuries, or nuisances to the public. Suitable barri- cades, flags, lights, flares or other devices shall be used at such times and places as are reasonably required for the safety of all members of the public. Any poles or other fixtures placed err► in any public way by the Grantee shall be placed in such a manner as not to interfere with the usual travel on such public way. (d) Grantee shall, at its own expense, and in a manner approved by the Grantor, restore to Grantor standards and specifications any damage or disturbance caused to the public way as a result of its operations or construction on its behalf. (e) Whenever, in case of fire or other disaster, it becomes necessary in the judgment of the Grantor to remove any of the Grantee's facilities, no charge shall be made by the Grantee against the Grantor for restoration and repair. (f) Grantee shall have the authority to trim trees on public property at its own expense as may be necessary 36 to protect its wires and facilities, subject to the supervision and direction of the Grantor. `, (g) Upon receipt of thirty (30) days written notice, the Grantee at its expense shall protect, support, tem- porarily disconnect, relocate, or remove any property of Grantee when, in the opinion of the Grantor the same is required by reason of traffic conditions, public safety, street vacation, freeway or street grade, separation or realignment, installation of sewers, drains, waterpipes, power line, signal line, transpor- tation facilities, tracks, or any other types of structure or improvements by governmental agencies whether acting in a govern- mental or a proprietary capacity, or any other structure or public improvement, including but not limited to movement of �4r buildings, redevelopment, or any general program under which the Grantor shall undertake to cause any such properties to be located beneath the surface of the ground. Nothing hereunder shall be deemed a taking of the property of Grantee and Grantee shall be entitle to no surcharge by reason of anything hereunder. (h) After receipt of thirty (30) days written notice, upon failure of Grantee to commence, pursue or complete any work required by law or by the provisions of this ordinance to be done in any street, within the time prescribed and to the satisfaction of the Grantor, the Grantor may, at its option, cause such work to be done and the Grantee shall pay to the Grantor the cost thereof in the itemized amounts reported by the Grantor to Grantee within thirty (30) days after receipt of such itemized report. (i) The Grantee shall make no paving cuts or curb cuts unless absolutely necessary, and only after written permission has been given by the Grantor. (j) Grantor reserves the right to require con- duit for underground cabling in special areas. 37 14.60.121 Construction and Technical Standards. (a) Construction Standards. (1) Grantor Codes and Permits. Grantee shall comply with all applicable Grantor construction codes and permits procedures. Grantor shall be entitled to charge reason- able permit and inspection fees to recover the special nonrecur- ring inspection costs imposed by the construction of the cable system. (2) Compliance with Safety Codes. All con- struction practices shall be in accordance with all applicable sections of Federal and State Occupational Safety and Health Acts and any amendments thereto as well as all State and local codes where applicable. %%W (3) Compliance with Electrical Codes. All installation of electronic equipment shall be of a permanent nature, durable and installed in accordance with the provisions of the National Electrical Code as amended, and all applicable State and local codes. (4) Antennas and Towers. Antenna support- ing structures (towers) shall be designed for the proper loading as specified in Electronics Industry Association's R.S.222 -A spe- cifications, and provisions of the Uniform Building Code, as modified. (5) Compliance with Aviation Requirements. Antenna supporting structures (towers) shall be painted, lighted, erected and maintained in accordance with all applicable rules and regulations of the Federal Aviation Administration and all other applicable State or local codes and regulations. (6) Construction Standards and Require- ments. All of the Grantee's plant and equipment, including but not limited to, the antenna site, headend and distribution system towers, house connections, structures, poles, wire, cable, coaxial cable, fixtures and appurtenances shall be installed, located, erected, constructed, reconstructed, replaced, removed, repaired, maintained and operated in accordance with good engi- 38 neering practices, performed by experienced maintenance and construction personnel so as not to endanger or interfere in any `kw manner with the rights of any property owner, or to hinder or obstruct pedestrian or vehicular traffic. (7) Safety, Nuisance, Requirements. The Grantee shall at all times employ professional care and shall install and maintain in use commonly accepted methods and devices preventing failures and accidents which are likely to cause damage, injury or nuisance to the public. (b) Technical Standards. The Cable Communica- tions System shall meet all technical and performance standards contained in the Franchise Agreement. (c) Test and Compliance Procedure. The Grantee shall submit, within sixty (60) days after the effective date of the Franchise Agreement, a detailed test plan describing the methods and schedules for testing the Cable Communications System on an ongoing basis to determine compliance with the provisions of the Franchise Agreement. The tests for Basic Cable Services shall be performed at intervals no greater than twelve (12) months. The tests may be witnessed by representatives of the Grantor, and written test reports shall be submitted to the Grantor. If more than ten percent (10 %) of the locations tested fail to meet the performance standards, the Grantee shall be required to indicate what corrective measures have been taken, and the entire test shall be repeated. A second failure of more than ten percent (10 %) may result, at the Grantor's option, in appropriate remedies. (d) Special Tests. At any time after commence- ment of service to subscribers the Grantor may require additional tests, full or partial repeat tests, different test procedures, or tests involving a specific subscriber's terminal. Requests for such additional tests will be made on the basis of complaints received or other evidence indicating an unresolved controversy or significant noncompliance, and such tests shall be limited to ISWI the particular matter in controversy. The Grantor shall endeavor 39 to so arrange its requests for such special tests so as to mini- mize hardship or inconvenience to Grantee or to the subscriber. (e) Cost of Tests. The cost of all tests required by (c) and (d) above, and retesting as necessary, shall be borne by the Grantee. 14.60.122 Areawide Interconnection. (a) Interconnection. The Grantor may request Grantee to interconnect public usage channels of the Cable Com- munications System with any or all other cable systems in adjacent areas. Interconnection of systems shall permit inter- active transmission and reception of program material, and may be done by direct cable connection, microwave link, satellite, or other appropriate method. rhw (b) Interconnection Procedure. Upon receiving the request of the Grantor to interconnect, the Grantee shall immediately initiate negotiations with the other affected system or systems, and shall report to the Grantor the results of such negotiation no later than sixty (60) days after initiation. (c) Relief. The Grantee may be granted reason- able extensions of time to interconnect or the Grantor may rescind its request to interconnect upon petition by the Grantee to the Grantor, if the Grantor finds that the Grantee has nego- tiated in good faith and has failed to obtain an approval from `. the system or systems of the proposed interconnection, or that the cost of the interconnection would cause an unreasonable or unacceptable increase in subscriber rates. (d) Cooperation Required. The Grantee shall cooperate with any interconnection corporation, regional inter- connection authority or City, County, State or Federal regulatory agency which may be hereafter established for the purpose of regulating, financing, or otherwise providing for the intercon- nection of cable systems beyond the boundaries of the franchise area. M 40 `r• 64r �4r (e) Initial Technical Requirements to Assure Future Interconnection Capability. (1) Every Grantee receiving a franchise to operate a Cable Communications System within the franchise area shall use the same frequency allocations for commonly provided television signals so far as is technically and economically feasible. (2) Grantee shall make a reasonable effort to provide local origination and access equipment that is com- patible throughout the area served by the cable system. 41 SECTION 14.60.130 SERVICE PROVISIONS 14.60.131 Services to be Provided. The Grantee shall k4w initially provide, as a minimum, ny services listed in the Fran- chise Agreement. Services shall not be reduced without at least thirty (30) days prior notification to Grantor and subscribers. 14.60.132 Basic Cable Service. The "Basic Cable Service" shall include any service tier which includes the retransmission of local television signals. This service shall be provided to all subscribers at the established monthly subscription rates. 14.60.133 Local Origination Channel(s). If local origina- tion programming is provided, the Grantee shall operate any cablecasting studios on a high - quality, professional basis for the purpose of providing cablecast programming responsive to `' local needs and interests. 14.60.134 Public, Educational and Government(PEG) Access Facilities. The Grantee shall provide the PEG Access Facilities including channel capacity, necessary interface equipment and cabling to permit operation as specified in the Franchise Agree- ment. 14.60.135 Cable Channels for Commercial Use. The Grantee shall designate channel capacity for commercial use as required by applicable law. 164r M 42 SECTION 14.60.140 OPERATION AND MAINTENANCE 14.60.141 Open Books and Records. The Grantor, upon rea- 1164W sonable notice, shall have the right to inspect at any time during normal business hours, all books, records, maps, plans, service complaint logs, performance test results and other like materials of the Grantee which relate to the operation of the franchise and are maintained at the local office required by Ordinance No. 1159, provided that the Grantor shall maintain the confidentiality of any trade secrets or other proprietary infor- mation in the possession of the Grantee and provided further, that records shall be exempt from inspection pursuant to this section to the extent required by applicable law regarding sub- scriber privacy and to the extent such records are protected by `"W law regarding subscriber privacy and to the extent such records Cn Owl are protected by law against discovery in civil litigation. If any of such books or records are not kept in the local office, or upon reasonable request made available to the Grantor, and if the Grantor shall determine that an examination of such records is necessary or appropriate to the performance of any of Grantor's duties, then all travel and maintenance expense neces- sarily incurred in making such examination shall be paid by Grantee. 14.60.142 Records Required. maintain: nance 1159. (a) In any event the Grantee shall at all times (1) The complaint file required by Ordi- (2) A full and complete set of plans, records and "as- built" maps showing the exact location of all Cable Communications System equipment installed or in use in the franchise area, exclusive of subscriber service drops. 43 SECTION 14.60.150 RIGHTS RESERVED TO THE GRANTOR 14.60.151 Right of Inspection of Construction. The Grantor �r shall have the right to inspect all construction or installation work performed subject to the provisions of the franchise and to `r �1 W make such tests as it shall find necessary to ensure compliance with the terms of this franchise and other pertinent provisions of law. 14.60.152 Right of Intervention. The Grantor shall have the right of intervention in any suit or proceeding involving the cable system franchise to which the Grantee is party, and the Grantee shall not oppose such intervention by the Grantor. 44 SECTION 14.60.160 RIGHTS RESERVED TO THE GRANTEE 14.60.161 Right of Grantee. In the event of any dispute %Nr between Grantee and Grantor over this ordinance or the Franchise �kw Agreement, or with respect to any rights or obligations arising therefrom, Grantee shall first pursue and exhaust any available administrative remedies. Thereafter Grantee may pursue any appropriate legal action. 45 SECTION 14.60.170 FRANCHISE VIOLATIONS 14.60.171 Remedies for Franchise Violations. If the �h► Grantee fails to perform any material obligation under the fran- chise, or fails to do so in a timely manner, the Grantor may at its option, and in its sole discretion; (a) Assess against the Grantee monetary damages up to the limits established in the Franchise Agreement for material franchise violations, said assessment to be levied against the security fund, hereinabove provided, and collected by Grantor after completion of the procedures specified in Section 14.60.172. The amount of such assessment shall be deemed to represent liquidation of damages actually sustained by Grantor by reason of Grantee's failure to perform. Such assessment shall not constitute a waiver by the Grantor of any other right or remedy it may have under the franchise or under applicable law, including without limitation, its right to recover from Grantee such additional damages, losses, costs and expenses, including actual attorney fees, as may have been suffered or incurred by Grantor by reason of or arising out of such breach of the fran- chise. This provision for assessment of damages is intended by the parties to be separate and apart from Grantor's right to enforce the provisions of the construction and performance bonds provided for in Section 14.60.100, and is intended to provide �kw compensation to Grantor for actual damages. (b) Terminate the franchise, for any of the causes stated in Sections 14.60.070 through 14.60.087 above. (c) No remedy shall be imposed by Grantor against Grantee for any violation of the franchise without Grantee being afforded due process of law, as provided for in Section 14.60.172 below. Grantor may impose any or all of the above enumerated measures against Grantee, which shall be in addition to any and all other legal or equitable remedies it has under the franchise or under any applicable law. 14.60.172 Procedure for Remedying Franchise Violations. In 1%W the event that the Grantor determines that the Grantee has vio- 46 lated any material provision of the franchise, the Grantor may make a written demand on the Grantee that it remedy such viola- 14%W tion. If the violation is not remedied, or in the process of being remedied, to the satisfaction of the Grantor within thirty (30) days following such demand, the Grantor shall determine whether or not such violation by the Grantee was excusable or inexcusable, in accordance with the following procedure: (a) An administrative hearing shall be held to review the alleged violation. If this hearing does not,result in a satisfactory resolution, and /or the Grantee requests a public hearing, then a public hearing shall be held, and the Grantee shall be provided with an opportunity to be heard upon thirty (30) days written notice to the Grantee of the time and the place of the hearing provided and the allegations of franchise viola- tions. (b) If, after notice is given and, at the Grantee's option, a full public proceeding is held, the Grantor determines that such violation by the Grantee was excusable as provided in Section 14.60.173 below, the Grantor shall direct the Grantee to correct or remedy the same within such additional time, in such manner and upon such terms and conditions as the Grantor may reasonably direct. (c) If, after notice is given and, at the 1%r Grantee's option, a full public proceeding is held, the Grantor determines that such violation was inexcusable, then the Grantor may impose a remedy in accordance with Section 14.60.171 above. 14.60.173 Force Majeure; Grantee's Inability to Perform. In the event Grantee's performance of any of the terms, condi- tions, obligations, or requirements of the franchise is prevented or impaired due to any cause beyond its reasonable control or 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, provided Grantee has notified Grantor in writing within thirty (30) days of its discovery of the occurrence of `r such an event. Such causes beyond Grantee's reasonable control 47 or not reasonably foreseeable shall include, but shall not be limited to, Acts of God and civil emergencies. �r Grantor and Grantee, in the Franchise Agreement, may mutually define those conditions deemed subject to force majeure application. �kr 48 SECTION 14.60.180 REPORTS 14.60.181 Annual Reports. Within one hundred twenty (120) Iftw days after the close of Grantee's fiscal year, the Grantee may be required to submit a written annual report, in a form requested by the Grantor, including, but not limited to, the following information: (a) A summary of the previous year's (or, in the case of the initial report year, the initial year's) activities in development of the cable system, including, but not limited to, services begun or discontinued during the reporting year, and the number of subscribers for each class of service. (b) A revenue statement, audited by an indepen- dent Certified Public Accountant, or certified by an officer of I%W the Grantee. (c) A statement of projected construction, if any, for the next two (2) years; (d) A list of Grantee's officers, members of its boards of directors, and other principals of Grantee; (e) A list of stockholders or other equity investors holding five percent (5%) or more of the voting interest in the Grantee and its parent, subsidiary and affiliated corporations and other entities, if any, unless the parent is a public corporation whose annual reports are publicly available. %W (f) To the extent that money, other than pro- fits, is paid to a parent, subsidiary, or other person affiliated with the Grantee, the amounts of such payments and the basis for computation of such amounts (e.g., the basis for computing any management fees or share of "home office" overhead). 14.60.182 Plant Survey Report. At the Grantor's request, Grantee shall submit to the Grantor an annual plant survey report which shall be a complete survey of the Grantee's plans and a full report thereon. Said report shall include, but not be limited to, a description and "as- built" maps of the portions of the franchise area that have been cabled and have all services " available, an appropriate engineering evaluation including suit- 49 able electronic measurements conducted in conformity with such requirements, including supervision, as the Grantor may pres- cribe. Said report shall be in sufficient detail to enable the Grantor to ascertain that the service requirements and technical standards of the franchise are achieved and maintained. If Grantor has reason to believe that portions or all of the system do not meet the technical standards incorporated into the Fran- chise Agreement, at Grantor's request, but no more often than once per three (3) years, the Grantee and the Grantor shall agree upon the appointment of a qualified independent engineer to evaluate and verify the technical performance of the cable system. The cost of such evaluation shall be borne equally by the Grantee and the Grantor. `rr 14.60.183 Copies of Federal and State Reports. The Grantee, upon request, may be required to submit to the Grantor copies of all pleadings, applications, notifications, communica- tions and documents of any kind, submitted by the Grantee to, as well as copies of all decisions, correspondence and actions by, any Federal, State and local courts, regulatory agencies and other government bodies relating to its cable television opera- tions within the franchise area. Grantee shall submit such documents to the Grantor no later than thirty (30) days after receipt of a Grantor request. The Grantee hereby waives any right to claim confidential, privileged or proprietary rights to `r► such documents unless such confidential rights are determined to be confidential by law or by the practices of Federal or State agencies. Such confidential data exempt from public disclosure shall be retained in confidence by the Grantor and its authorized agents and shall not be made available for public inspection. 14.60.184 Public Reports. A copy of each of Grantee's annual and other periodic public financial reports and those of its parent, subsidiary and affiliated corporation and other entities, as the Grantor requests, shall be submitted to the Grantor within thirty (30) days after receipt of a request. 50 14.60.185 Complaint File and Reports. An accurate and com- prehensive file shall be kept by the Grantee of any and all �W complaints regarding the cable system. A procedure shall be established by the Grantee by the time of installation of the cable system to remedy complaints quickly and reasonably to the satisfaction of the Grantor. Complete records of Grantee's actions in response to all complaints shall be kept. These files and records shall remain open to the public during normal busi- ness hours, so that individuals are able to inspect their own files. (a) A summary of service requests, identifying the number and nature of the requests and their disposition, upon Grantor request, shall be completed for each month and submitted �Nr to the Grantor by the tenth day of the succeeding month. tions. (b) A log and summary of all service interrup- (c) If requested by the Grantor, the results of an annual opinion survey report which identifies satisfaction or dissatisfaction among subscribers with cable communications services offered by the Grantee shall be submitted to the Grantor no later than two (2) months after the end of Grantee's fiscal year. The surveys required to make said report shall be in a form that can be transmitted to subscribers with one (1) or more %r bills for service, such as postage -paid self- addressed post cards. At the Grantor's option, the Grantor may prepare the survey form and request its inclusion with a monthly bill to subscribers. 14.60.186 Miscellaneous Reports. Grantee shall submit to the Grantor such other information or reports in such forms and at such times as the Grantor may reasonably request or require. 14.60.187 Inspection of Facilities. The Grantee shall allow the Grantor to make inspections of any of the Grantee's facilities and equipment at any time upon at least ten (10) days notice, or, in case of emergency, upon demand without prior 51 notice, to allow Grantor to verify the accuracy of any submitted report. 14.60.188 Public Inspection. All reports subject to public disclosure, shall be available for public inspection at a desig- nated Grantor office during normal business hours. 14.60.189 Failure to Report. The willful refusal, failure, or neglect of the Grantee to file any of the reports reasonably required, or such other reports as the Grantor reasonably may request, may be deemed a material breach of the franchise, and may subject the Grantee to all remedies, legal or equitable, which are available to the Grantor under the franchise or other- wise. 14.60.190 False Statements. Any materially false or mis- leading statement or representation made knowingly and willfully by the Grantee in any report required under the franchise may be deemed a material breach of the franchise and may subject the Grantee to all remedies, legal or equitable, which are available to the Grantor under the franchise or otherwise. 14.60.191 Cost of Reports. One (1) copy of all reports and records required under this or any other Section shall be fur- nished at the sole expense of the Grantee. 52 SECTION 14.60.200 MISCELLANEOUS PROVISIONS 14.60.201 Compliance with State and Federal Laws. Notwith- standing any other provisions of the franchise to the contrary, the Grantee shall at all times comply with all laws and regula- tions of the State and Federal government or any administrative agencies thereof. Provided, however, if any such State or Federal law or regulation shall require the Grantee to perform any service, or shall permit the Grantee to perform any service, or shall prohibit the Grantee from performing any service, in conflict with the terms of the franchise or any law or regulation of the Grantor, then as soon as possible following knowledge thereof, the Grantee shall notify the Grantor of the point of conflict believed to exist between such regulation or law and the %r laws or regulations of the Grantor or the franchise. 14.60.202 Separability Non - Material Provisions. If any provision of this ordinance or any related agreements is held by any court or by any Federal, State, or local agency of competent jurisdiction to be invalid as conflicting with any Federal, State or local law, rule or regulation now or hereafter in effect, or is held by such court or agency to be modified in any way in order to conform to the requirements of any such law, rule or regulation, and if said provision is considered non - material by the Grantor, said provision shall be considered a separate, `r, distinct and independent part of this ordinance, and such holding LM shall not affect the validity and enforceability of all other provisions hereof. In the event that such law, rule or regula- tion is subsequently repealed, rescinded, amended or otherwise changed, so that the provision hereof or thereof which has been held invalid or modified is no longer in conflict with the law, rules and regulations then in effect, said provision shall there- upon return to full force and effect, and shall thereafter be binding on the parties hereto, provided that the Grantor shall give the Grantee thirty (30) days written notice of such change before requiring compliance with said provision. 53 14.60.203 Separability - Material Provisions. If any material section of this ordinance, as determined by the Grantor �kr and the Grantee, is held to be invalid or preempted by Federal, State or County regulations or laws, resulting in a material adverse consequence to either party, the Grantor and Grantee shall attempt to negotiate appropriate modifications to the franchise to provide reasonable relief to the Grantor or Grantee from such invalidity or preemption, including the payment of damages. If the parties are unable to reach agreement on such modifications, then the dispute shall be submitted to a mutually agreeable arbitrator, in accordance with State law, who shall determine what modifications and /or liquidated damages are appro- priate. The arbitrator's decision shall be binding on the parties, provided, that no decision of the arbitrator shall require the Grantor or Grantee to be in violation of any Federal or State law or regulation. 14.60.204 Notices. Grantee shall maintain throughout the term of the franchise, a local address for service of notices by mail. 14.60.205 Captions. The captions to sections throughout this ordinance are intended solely to facilitate reading and reference. Such captions shall not affect the meaning or inter- pretation of this ordinance. 14.60.206 No Recourse Against the Grantor. The Grantee shall have no recourse whatsoever against the Grantor or its officials, boards, commissions, agents, or employees for any loss, costs, expenses, or damage arising out of any provision or requirement of the franchise or because of the enforcement of the franchise. 14.60.207 Nonenforcement by the Grantor. The Grantee shall not be relieved of its obligation to comply with any of the provisions of this ordinance by reason of any failure of the Grantor to enforce prompt compliance. 54 SECTION 3. This ordinance shall become effective at mid- night on the thirtieth day from and after the date of the final passage and adoption thereof. SECTION 4. The City Clerk shall certify to the adoption of this ordinance; shall cause the same to be entered in the book of original ordinances of said city; shall make a minute of the adoption thereof in the records of the meeting at which the same is passed and adopted; and shall cause it to be published in the manner prescribed by law. PASSED AND ADOPTED this 4th day of JUNE 1991. AYES: Mayor Jacobson, Mayor ProTem Dannen, Councilmen Wise and West. NOES: None ABSENT: None Mayor of the City,-of E1 Segundo (SEAL) 55 STATE OF CALIFORNIA ) COUNTY OF LOS ANGELES ) SS CI'T'Y OF EL SEGUNDO ) I, Ronald L. Hart, City Clerk of the City of El Segundo, California, DO IIERI:BY CER'T'IFY that the whole number of members of the City Council of the said City is five; that the foregoing ordinance, being Ordinance No. 1165 is a full, true correct original of Ordinance No. 1165 of the said City of El Segundo, California, entitled: AN ORDINANCE TO PROVIDE. I OR'I'IIE ESTABLISHMENT AND GRANTING OF FRANCHISES OR PRMLEGES FOR THE CONS'1'RUC'1'ION, MAINTENANCE AND OPERA'T'ION OF CABLE COMMUNICATIONS OR CABLE TELEVISION SYS'T'EMS AND FUR'T'HER PROVIDING FOR 'I'llE CON'T'INUING REGULATION AND ADMINISTRATION OF THESE FRANCHISES AND THE ACTIVITIES RELATIVE 'I'O THEM. which was duly passed and adopted by the said City Council, approved and signed by the Mayor or said City, and attested by the City Clerk of said City, all at a regular meeting of the said Council held on the 4th day of June, 1.991, and the same was so passed and adopted by the following vote: AYES: Councilmembers Dannen, Clutter, West, Wise and Mayor Jacobsen NOES: None ABSTEN'I'IONS: None I do hereby further certify that pursuant to the provisions of Section 36933 of the Government Code of the State of California, that the foregoing Ordinance No. 11.65 was duly and regularly published according to law and the order of the City Council of said City of El Segundo Herald, a weekly newspaper of general circulation, printed, published and circulated within said City and that the same was so published therein on the following day, to wit: Ronald L. Hart City Clerk of the City of El Segundo, California Sbw (SEA1.)