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Ordinance - 1563t ORDINANCE NO. 1563 AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF WEST COVINA, CALIFORNIA AMENDING ARTICLE II OF CHAPTER 11 RELATING TO FRANCHISES FOR COMMUNITY ANTENNA TELEVISION SYSTEMS. The City Council of the City of West Covina, Cali- fornia, does ordain as follows: SECTION 1: Article II of Chapter 11 of the West Covina Municipal Code relating to franchises for Community Antenna Television Systems is hereby amended to read as follows: Article II Community Antenna Television.Systems SECTION 11-16 DEFINITIONS For the purposes of this ordinance, the following terms, phrases, words, abbreviations, and their derivations shall have the meaning given herein. When not inconsistent with the context, words used in the present tense include the future tense, words in the plural number include the singular number, and words in the singular number include the plural number. (A) "CITY" shall mean the City of West Covina, a municipal corporation of the State of California, in its present incorporated form or in any later reorganized, consoli- dated, enlarged or reincorporated form. (B) "COUNCIL" shall mean the present governing body of the City of West Covina or any future board constituting the legislative body of the City. (C) "CITY MANAGER" shall mean the city manager of the City of West Covina or his designee. (D) "FRANCHISE" shall mean and include any authoriza- tion granted hereunder in terms of a franchise, privilege, permit, license or otherwise to construct, operate and maintain a community antenna television system within all or a specified area in the City. Any such authorization, in whatever form granted, shall not mean and include any license or permit required for the privilege of transacting and carrying on a business within the City as required by other ordinances and laws of this City. (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 corpora- tion granted a franchise by the Council under this Ordinance, and the lawful successor, transferee or assignee of said person, firm or corporation. t (G) "STREET" shall mean the surface, the air space above the surface a-Tthe area below the surface of any public street, other public right of way or public place, including public utility easements. (H) "PROPERTY OR GRANTEE" shall mean all property owned, installed, or used wit in t e City by a Grantee in the conduct of a community antenna television system business under the authority of a franchise granted pursuant to this Ordinance. ( I ) --sugs _RTRFR" or "usER" shall mean any person or entity receiving for any purpose any service of the Grantee's . community antenna television system including, but not limited to the conventional community antenna television system service of retransmission of television broadcast, radio signals, Grantee's 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 communi- cation. (J) "CABLE TELEVISION SYSTEM", "CATV", "CTV" and "COMMUNITY ANTENNA" for the purpose of this Ordinance, are terms describing a system employinq antennae, microwave, wires, wave guides, coaxial cables, or other conductors, equipment or facilities, designed, constructed or used for the purpose of: (1) Producing, receiving, amplifying and distributing by coaxial cable, audio and/or visual radio, television, electronic or electrical signals to and from persons, sub- scribers and locations in the franchise area. (2) Transmitting original cablecase programming not received through television broadcast signals; (3) 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; (4) Transmitting or receiving two-way signals or transmissions; n LJ (5) Transmitting and receiving all other signals; digital voice, and audiovisual; provided however, that any of the services, permitted hereunder to be performed, as described above, shall be those performed by the Grantee for subscribers, as herein defined, in the operation of a cable television or CATV system franchised by the City and not otherwise. (K) "GROSS RECEIPTS" as used in the following categories, shall mean any and all compensation, in whatever form, grant, subsidy, exchange, or otherwise, directly or indirectly received by a Grantee not including any taxes or services furnished by the Grantee imposed indirectly on any subscriber or users by a city, county, state or other govern= mental unit, and collected by a•Grantee for such entity. (L) "GROSS ANNUAL BASIC SUBSCRIBER RECEIPTS" shall mean any and all compensation and other consideration received -2- directly or indirectly by the Grantee from subscribers in payment of the regularly furnished service of the cable televi- sion system in the transmission of broadcast television, radio signals, satellite delivered programming and original cablecast programming of the Grantee designated as the "basic service". (M) "GROSS ANNUAL NON -BASIC SERVICE RECEIPTS" shall mean any and all compensation and other consideration received directly or indirectly by the Grantee from subscribers or users in payment for the receipt of signals whether for "pay television", "facsimile" transmission, "security services", "return" or "response" communication, and whether or not • transmitted encoded or processed to permit reception by only selected subscribers, and designed as an optional service, or non -basic service. ' (N) "GROSS ANNUAL ADVERTISING RECEIPTS", shall mean any income, compensation and other consideration received by Grantee from any advertising on the cable television system. (0) "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 and air time, of any channel permitted or designated by the Federal Communi- cations Commission to be so leased or rented. (P) "SPECIAL SERVICE AREA" shall mean any areas of the City designated by the Council, if it so elects, in the franchise agreement,'where the franchisee may charge different rates, or provide different services, than in the remainder of the City. SECTION 11-17. FRANCHISE TO INSTALL AND OPERATE (A) A non-exclusive franchise to install, construct, operate, and maintain a cable television system in, on, above, • or under 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. • No provision of this Ordinance may be deemed or construed as to require the granting of a franchise when in the opinion of the Council it is in the public interest to restrict the number of Grantees to one or more. (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 facili- ties, and Grantee shall be required to comply with all 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 11-18 CABLE TELEVISION SYSTEM STANDARDS The cable television system permitted to be installed and operated hereunder shall be designed and installed to meet -3- all of the standards and offers all of the services as expressly set forth in this Section and, throughout this Chapter. Said services shall be offered to all city subscribers in accordance with the franchise agreement and the grantee shall not reduce nor change the level of services provided without City Council approval. (A) Minimum Service Standards. As a minimum, the system(s) shall be constructed and implemented to provide the following: (1) 52 channels on a subscriber network. • (2) Programming services that include: a. National and international news services b. Financial and stock market information C. Sports channels d. Weather services e. Children's programming f. Movie channels g. Pay cable services h. Cultural programming i. Foreign language programming j. Programming for the handicapped k. Processed FM stereo programming 1. Educational programming from local public schools and higher education facilities. (3) Interactive capabilities which shall be imple- mented as provided in subsection (c) below. (4) A separate institutional network with switching capabilities between the subscriber network. The institutional network shall be implemented as provided in sub -section (d) below. • (5) 7 local channels for educational, governmental, library, religious, public and local origination use, with provisions for future additional channel allocation based upon usage and demand. • (6) A fully -equipped state-of-the-art local tele- vision production studio located within the city limits pursuant to the provisions of Section 11-18(G) herein. (7) A dedicated mobile television production van. (8) Free installation and services for all municipal buildings (as designated by the City), public and private schools, libraries and hospitals. (9) The wiring and installation of dedicated tele- vision origination equipment at City Hall for coverage of City Council and other meetings and/or hearings. (10) Sufficient quantities of TV receivers, portable video cameras, recorders, and such ancillary equipment (i.e. a "pool" of equipments which may be shared by public and institu- tional users and may be "checked out" for use away from the studio.) QC v (11) Sufficient technical personnel to both operate the studio and mobile van, and to provide assistance to community users in the preparation, production, and broadcasting of local Programming. (12) An internship program in video production serving the City's educational and municipal agencies. (13) On -going financial support for the development, operation, and promotion of the public access channels. (14) Emergency override features. • (15) Interconnection of subscriber and institutional networks with those of adjacent communities, pursuant to the provisions of Section 11-18(E) herein. (16) Addressable converters and/or electronic trapping shall be provided to all subscribers. The term "dedicated" as used in this section, shall mean the equipment which is dedicated is to be used solely for the purpose specified and is not shared with any other cable system owned or operated by the grantee(s). (B) Other Services. The cable television system permitted to be installed and operated hereunder may also engage in the business of: (1) 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. (2) Transmitting and receiving all other signals; digital, voice and audiovisual. • (3) Transmit original cablecast programming not received through television broadcast signals, on a pay -per - view basis. (4) Transmit any additional broadcast signals permitted by the Federal Communications Commission. (C) Interactive Capability. The CATV system shall be constructed with full two-way capability (upstream and down- stream transmission and reception) of both audio and video signals. In year 3 of the franchise (Year 1 begins with the acceptance of the franchise), and by not later than the end of year 3, grantee shall submit to the City Manager, for City Council approval, a plan for implementation of the two-way energization of the subscriber network. Such a plan shall include, as a minimum, all subscriber services to be offered, the date of implementation and marketing of those services, and the fees to be charged subscribers for each and every service and/or level of service proposed. Following City Council approval, grantee shall implement those two-way services by no later than the end of year 4 of the franchise. Failure to meet any of the provisions of this section shall subject the grantee to a penalty payment of $1,000 per day for each and every day's delay beyond the deadline(s) set forth herein. • (D) Institutional Network. 'The CATV system shall be designed as a "switchable" network, between the subscriber network, with full, two-way capability (upstream and downstream -5- transmission and reception) of both audio and video signals. In year 3 of the franchise (year 1 begins with the acceptance of the franchise) and by not later than the end of year 3, grantee shall submit to the City Manager, for City Council approval, a plan for the implementation of the Institutional Network. Such a plan shall include as a minimum, all subscriber services to be offered, the date for implementation and market- ing of those services, and the fees to be charged subscribers for each and every service and/or level of service proposed. Following City Council approval, grantee shall implement those services by no later than the end of year 4 of the franchise. . Failure to meet any of the provisions of this section shall subject the grantee to a penalty payment of $1,000 per day for each and every day's delay beyond the deadline(s) set forth herein. (E) Interconnection of Services. The grantee shall make all reasonable efforts to electrically interconnect the West Covina CATV system with CATV systems in adjacent communi- ties for the purposes of sharing locally originated subscriber and institutional services. Such an interconnect shall be effected by coaxial cable, fiber optic cable, microwave or other bi-directional signal transportation means as appropriate to permit services interchange in compliance with the technical provisions of this chapter. Within three (3) years of the acceptance date of the franchise, the grantee shall contact all franchised operators in the communities adjacent to West Covina for the purposes of exploring and securing a mutually acceptable system interconnect agreement and report the results of said activity to the West Covina City Manager. Said report shall state each contacted operator's name, city, and response, list all programming and services activity available to West Covina subsribers via an interconnect agreement as well as list programming and services to similarly be transmitted from West Covina to the adjacent community(ies) and explain the substance of the governing business agreement reached with the other • operators. (1) If an adjacent operator(s) "IS" responsive to the grantee's inquiry for interconnect, the City Council regulating the franchise of the adjacent operator(s), and the City Council of West Covina must first mutually approve all details, plans and other agreements before implementation of the interconnect. Pursuant to the provisions of Section 11-27 herein the Council may adopt such an agreement by resolution. (2) If an adjacent operator(s) "IS NOT" responsive to the Grantee's inquiry, a letter report, stating that reasonable attempts to gain an interconnect agreement were made but unsuccessfully, shall similarly be filed with the City. (3) In the case of adjacent new CATV systems con- structed in communities after the West Covina system, the Grantee shall have six (6) months after the new system becomes operational to make the required inquiries and attempt at an interconnect agreement. (4) In the case of adjacent CATV systems operated by the Grantee, the Grantee shall have three (3) years from acceptance of this franchise in which to provide a plan to interconnect with the West Covina system, the implementation of which shall be mutually accepted and agreed to by the Cities where such franchises operated by the Grantee exist. .Z:i (F) Systems Construction Standards. (1) General Construction Schedule. (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, microwave carrier licenses, and other permits, licenses and authorizations to be granted by duly constituted regulatory agencies having jurisdiction over the operation of cable television systems, associated microwave transmission/reception facilities and/or satellite communications facilities. (b) Within one -hundred twenty (120) days after award of franchise, Grantee shall commence construction and installation of the cable television system. (c) As part of its proposal to the City of West Covina, the franchise applicant shall indicate a proposed construction schedule for the completion of the installation of the cable television system throughout the entire City of West Covina. Service to the areas prescribed in that proposal and approved by the Council, shall be provided within the period stated and failure on the part of the Grantee to complete each of the matters set forth therein, shall be grounds for termina- tion of the franchise. The proposed construction schedule shall not, in any event, exceed two (2) years, except that, by resolution, pursuant to subsection (d) of this Section, the Council, in its direction, may extend the time for the commence- ment and completion of installation and construction for additional periods in the event the Grantee, acting in good faith, experiences delays by reason of circumstances beyond his control. Any limitations on system extension, or exclusions, shall be referenced as part of the Grantee's proposal and approved by Council. • (d) Any requests for extensions of the proposed construction deadlines proposed by Grantee, due to acts of God, acts of the public enemy fires, floods, epidemics, quarantine restrictions strikes, lockouts, freight embargoes, unusually severe weather, or from any other cause beyond the reasonable control of Grantee and/or its employees, agents or contractors, must be requested from the City Manager in writing within fourteen (14) days after the cause for such delay first occurs. Such request must specify the exact reason for the delay and the total number of extension days requested. Whenever or wherever possible, Grantee shall provide written material such as newspaper articles, letters from vendors, sub -contractors or other justifiable material that supports such a request. Within fourteen (14) days of receipt of the Grantee's request for an extension the City Manager will respond to the Grantee with approval of, partial approval of, or denial of the request for extension. • (e) By acceptance of the franchise granted hereunder, Grantee agrees that failure to comply with any time requirements referred to in Sub -sections (a), (b), and (c), of this section, or as may be extended by Council, Grantee agrees that in addition to all other penalty provisions specified in this Article, Grantee will pay to the City the sum of One Thousand Dollars ($1,000) per day for each and every day's delay beyond �C the time prescribed, plus authorized extensions thereof, for completion of any of the acts required to be done by this sub -section. (2) Use of Poles. Notwithstanding the provisions of Section 23-273 of the West Covina Municipal Code, Grantee shall be authorized to utilize existing poles, conduits, and other facilities and shall not construct or install any new, different, or additional poles, whether on public or privately -owned property. (3) Undergrounding of System. 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, or whenever -the City shall undertake a program designed to cause such facilities to be located beneath the surface of the streets in any area or throughout the City, the Grantee shall likewise construct, place or replace, operate and maintain all of its transmission and distribution system under- ground at no cost to the City, with the exception of "active electronic" equipment which may be placed above ground. The Grantee shall have the option of sharing or not sharing utility trenches, however at no time shall Grantee place cable underground without appropriate conduit. (4) Required Approvals. The design of all surface or above ground mounted equipments shall be approved by the = City Engineer and located so as not to endanger the public safety or welfare, nor physically detract from the surroundings. The method of underground construction to be utilized by the Grantee, whether by trenching, boring, cutting or other method and the restoration of streets, parkways, alleys, and other City right-of-ways utilized for the placement of the Grantee's conduits and/or ancillary equipment, must first be submitted to the City Engineer for approval. The construction methods approved will be subject to the required permit fees and City inspection as may be required by 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, under and about streets. (5) Submission of Drawings. Grantee shall furnish the City with as -built drawings of the entire cable television system. Within thirty (30) days of completion of construction of five (5) miles of city streets, and for each five (5) miles thereafter until the system is completed, or annually if less than five (5) miles was constructed during the previous twelve (12) months, Grantee shall file as -built drawings with the City Engineer. In the event Grantee desires to make any changes or modifications to the cable system that would alter the City's as -built plans, Grantee shall first obtain such approval from the City Engineer- and then file revised plans which reflect the changes within thirty (30) days of completion of same. (6) City Use of Facilities. 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 facilities erected, controlled, or maintained exclusively by or for the Grantee, provided such use does not interfere with the use by the Grantee. (7) Identification Required. Grantee agrees to provide a method of employee/sub-contractor identification, • acceptable to the City, for all such individuals who may make personal contact with West Covina residents for the purposes of construction, marketing, or other services of the cable televi- sion system. (8) Maintenance, Removal, Abandonment. The Grantee at its expense shall protect, support, temporarily disconnect, relocate or remove any property of Grantee when, in the opinion of the City Engineer, the same is required by reason of traffic conditions public safety, street vacation, freeway or street construction, change or establishment of street grade, instal- lation of sewers, drains, water pipes, power lines, signal lines, transportation facilities tracks or other types of • structures 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 redevelop- ment. 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 shall be entitled to no surcharge by reason of anything hereunder. (a) 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, the City Manager 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. (b) In the event that: (i) The use of any part of the system of Grantee is discontinued per any reason for a continuous period of thirty (30) days, without prior written notice to and approval by the • City; or (ii) Any part of such system has been installed in any street or other area without complying with the require- ments hereof; or • (iii) 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 streets or other areas from which such property has been removed to such condition as the City Engineer shall approve, and the Council may, upon written application thereof by the 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, acknowledge 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. (G) Technical Performance and Maintenance Standards. The CATV system shall be designed, installed, maintained and tested in accordance with the highest and best CATV industry practice and, as a minimum, shall conform with the technical cm performance standards contained, herein. In addition, should the Federal Communications Commission (FCC), or other State or Federal authority having jurisdiction, impose CATV system technical performance standards either outside the scope of the technical performance standards contained herein, or requiring a higher level of CATV system perform- ance, those standards are hereby incorporated herein by reference. If, for any reason, said FCC or other technical standards shall become reduced in scope or service level, the more stringent standards herein shall remain in effect. • (1) Performance Standards. Performance of the CATV system as measured at the input to any subscriber terminal with matched 75 ohm termination shall be as follows: (a) The frequency boundaries of cable television channels delivered to the input of the subscriber terminals shall conform to those set forth in FCC 73.603(a), or subsequent FCC standard. (b) If no frequency converter is supplied to the subscriber, the visual carrier frequency shall be maintained 1.25 MHz +25 KHz above the lower frequency boundary of the cable television channel. If a frequency converter is supplied to the subscriber by the Grantee the following requirement shall be applied at the interface between the converter and the subscriber's terminal equipment: when the visual carrier at the output of the converter has been tuned to a frequency 1.25 MHz above the lower frequency boundary of a cable television channel with the converter stabilized at an ambient temperature between 200C and 25°C, the frequency of the visual carrier shall not vary more than +2500 KHz for a period of at least three (3) hours, during which period the ambient temperature may vary +5°C about the initial ambient temperature. . (c) The aural center frequency of the aural carrier shall be 4.5MHz +/-1 KHz above the frequency of the visual carrier. (d) The visual signal level across a 75-ohm termi- nating impedance as viewed from subscriber terminals shall not be less than 1500 microvolts (+3.5dBnv) at each subscribers outlet. (e) The visual signal level on each channel shall be maintained within: (i) 3 decibels of the visual signal level of any visual carrier within 6 MHz nominal frequency separation, and, (ii) 12 decibels of the visual signal level on any other channel, and, (iii) a maximum level such that signal level degrada- tion due to overload in the subscriber's receiver does not occur, and, period. • (iv) 12 decibels over any twenty-four (24) hour -10- 0 (f) The rms voltage of the aural signal shall be maintained between 13 and 17 decibels below the associated visual signal level. (g) The peak -to -peak variation in visual signal level caused by undesired low frequency disturbances (hum or, repetitive transients) generated within the system or by inadequate low frequency response, shall not exceed five -percent (5%) of the visual signal level. (h) The amplitude characteristic shall be within a range of +/-2 decibels from 0.75 MHz to 5.0 MHz above the lower boundary frequency of the cable television channel, referenced isto the average of the highest and lowest amplitudes within these frequency boundaries. (i) The ratio of visual signal level to system noise shall be not less than 42 decibels. (j) The ratio of visual signal level to any undesired co -channel television signal operating on proper offset assign- ment shall be not less than 36 decibels. (k) The ratio of visual signal level to the rms amplitude of any coherent disturbances such as intermodulation products or discrete -frequency interfering signals not operating on proper offset assignments shall not be less than 46 decibels. (1) The terminal isolation provided each subscriber shall not be less than 18 decibels, but, in any event, shall be sufficient to prevent reflections caused by open -circuited or short-circuited subscriber terminals from producing visible picture impairments at any other subscriber terminal. (m) As an exception to the general provision requir- ing measurements to be made at subscriber terminals, and without regard to the class of cable television channels involved, radiation from a cable television shall be measured • in accordance with procedures outlined in FCC regulations, and shall be limited as follows: FREQUENCIES RADIATION LIMIT DISTANCE (microvolts/meter) (feet) Up to and including 54 MHz 15 100 Over 54 up to and including 216 MHz 20 10 Over 216 MHz 15 100 (n) The CATV system shall be rated for continouous, twenty-four (24) hour per day operation. (o) The FM signal level across a 75 ohm terminating impedance as viewed from subscriber's terminals shall be not less than 100 microvolts (-20 dBmV) nor greater than the highest permitted Channel 6 aural signal level. (p) The FM signal on each channel shall be maintained within: (i) 3 decibels of the FM signal of any FM signal on an adjacent (200 MHz spacing) channel, and, -11- (ii) 6 decibels of the FM signal level of any other FM signal carried on the system. (q) The CATV system shall, as a minimum, be opera- tional in full compliance with the applicable specifications contained herein, over the radio frequency spectrum from 50 to 400 MHz inclusive. Further, the system shall be designed such that fifty-two (52) channel operation is possible from the outset utilizing the 50 to 400 MHz spectrum. (r) The CATV system shall, as a minimum, be capable of operating in full compliance with the applicable specifica- is tions herein, a return signal capacity in all portions of the system, over the frequency range of 5 to 30 MHz. (s) The Grantee shall, at all times during the franchise, properly install and maintain adequate shielding, filtering and grounding at affected installations within the CATV system to eliminate system interference from local radio/ television broadcast stations, commercial, government and aeronautical radio stations and/or from fundamental frequency overload by radio amateur or citizen's radio service transmis- sions which are in compliance with the Federal Communications Commission regulations. (2) Broadband Requirements. Nonbroadcast signals carried on the CATV system shall meet the following broadband requirements. The RF modulated signals associated with these baseband signals shall meet all requirements of Subsection 1, above. (a) Overall baseband system video frequency response shall be +/-2 decibels over a DC to 4.2 MHz bandwidth. (b) Baseband video tilt shall not exceed two -percent (2%) at the vertical or horizontal rate. . (c) ratio shall be bandwidth. (d) the following equivalent): Overall baseband system video signal-to-noise not less than 42 decibels over a DC to 4.2 MHz Video synchronizing waveform shall comply with applicable standard (latest edition or its (i) 2: 1 Interlace monochrome - EIA RS-330 (ii) full interlace monochrome - EIA RS-170 (iii) color - FCC 73.699 Figure 6 (e) Where applicable, minimum television camera, (live and film) performance shall be: (i) Resolution ( luminance) - 350 line center (vertical); 500 line center, 400 line corners (horizontal) (ii) Scan linearity - two percent (2%) maximum error (horizontal and vertical) (iii) Registration (color only) two tenths percent (0.2%) in centered circle of 0.8 picture • height; four tenths percent (.4%) overall. -12- (iv) Video tilt - two percent (2%) maximum (horizontal rate). (f) Overall audio system frequency response shall be +/-3 decibels over the frequency range 50 to 10,000 Hz. (g) Overall audio system signal-to-noise ratio shall be not less than 50 decibels over the frequency range 50 to 10,000 Hz. (h) Overall audio system harmonic distortion shall not exceed two percent (2%) at any frequency from 50 to 10,000 • Hz. (3) Local Origination Studio. The local origination studio(s) provided by the Grantee shall meet the following minimum requirements: (a) 600 square -foot (net) space minimum (b) 12 foot ceiling height minimum (c) 3200°-Kelvin tungsten halogen professional television production lighting: system with a minimum of 200 foot-candles luminance. (d) Acoustical noise level under normal studio operating conditions not to exceed NC-25. (e) A minimum complement of television production equipment to include the following, or approved equivalent: (i) three (3) 3-tube color television cameras with full remote control and ENG portable capability. • (ii) all necessary studio lighting to meet the specifications noted above and with indivi- dual light dimming capability. • (iii) a video switcher with chroma key, special effects and downstream capability. (iv) a character generator with multiple font sizes, automatic vertical and horizontal scroll. (v) one time base corrector (TBC) for signal processing of videotape recorders during editing. (vi) one time base corrector (TBC) for on -cable playback of videotape players. (vii) a 3/4" videotape editing system with multiple source capability and SMPTE time code features. (viii) two designated 3/4" videotape players. (ix) one 3/4" portable videotape recorder/player with rechargeable batteries. -13- (x) an audio mixing board with a minimum of four -channel input/output capability, two turntables, one two -channel tape recorder, one cassette tape recorder, four lapel microphones, two cardiod studio mics. (xi) a sync generator. (xii) a multiplexer, to include, one 16mm and one 8mm sound projector, and two 35mm slide projector capability. • (xiii) one vectorscope. (xiv) two waveform monitors. (xv) all necessary video and audio monitors. (xvi) all necessary mounting racks and consoles. (xvii) all wiring, amplifier, terminal and processing equipment. (xvii) all necessary test and maintenance equipment. (xix) a supply of spare parts to keep all equip- ment in a continual state of operation. (4) Maintenance of System. The Grantee shall maintain the system so it consistently operates within the substantial compliance of the technical standards herein; substantial compliance being defined as ninety-five percent (95%) of the channels to be received shall meet all applicable technical standards simultaneously at the time of measurement, and one -hundred percent (100%) of the local origination equip- ment shall meet all applicable technical standards specified . herein". (H) New Developments. The Grantee shall continue to upgrade its facilities, equipment and service so that its system is as advanced as the current state of the technology will allow. The Grantee shall install additional channel capacity as required to keep channel capacity in excess of the reasonable demand therof by users. At all times the cable system shall be no less advanced than any other system of comparable size, excepting only systems which are experimental, pilot, or demonstration. Upon determination by the City that additional channel capacity or current technological upgrading is required, the City and Grantee shall meet and jointly establish a schedule and conditions for implementation of the required changes to the CATV system. Failure on the part of the Grantee to comply to either the agreed upon schedule or conditions shall be cause for a penalty of $1,000 per day for each and every day beond the time prescribed for completion and/or implementation. By resolution, and in accord with Section 11-27 of this Ordinance, the Council, in its discretion, may extend the time for the commencement and completion of the terms of this section for additional periods in the event the Grantee, acting in good faith, experiences delays by reason of circum- stances beyond his control. -14- (I) Local Business Office. Grantee agrees to maintain a local business office within the City of West Covina for the purpose of conducting its local activities. Grantee further agrees to maintain a 24-hour toll -free answering service for service related problem calls, as well as separate toll -free telephone numbers for the System Manager, the Sales/ Marketing Department, and Service Department. A minimum of three lines shall be maintained for service and sales, and, in the event the City determines through subscriber complaints that those are insufficient to meet current demands, Grantee agrees to add such additional lines as may be necessary to • provide prompt, efficient response to subscriber inquiries. All such telephone numbers indicated above shall be listed in directories of the telephone company serving the City, and be so operated that complaints and requests for repairs or adjustments may be received at any time, day or night, seven (7) days a week. All complaints shall be acknowl- edged within twenty-four (24) hours of receipt. (J) Complaint Procedure and Remedies for Inadequate Service. (1) Complaint Procedure. Pursuant to FCC Rules, the following procedure shall be adhered to in the event of sub- scriber complaints or complaints by City residents: (a) As part of the franchise proposal grantee shall submit to City written procedures for receiving, acting upon and resolving subscriber complaints to the satisfaction of the City Council. The Grantee shall furnish a notice of such procedure to each subscriber at the time of initial subscription to the system. (b) Maintain a written record, or "log" listing date and time of customer complaints, identifying the sub- scriber and determining the nature of the complaints and when and what action was taken by the'Grantee in response thereto; such record shall be kept at Grantee's local office, reflecting the operations to date for a period of a least three (3) years, and shall be avail- able for inspection during regular business hours without further notice or demand by the City Manager. (c) In the event that a customer complaint is not resolved to the mutual satisfaction of the customer or the Grantee, either customer or the Grantee may request the assistance of the City Manager in resolving the matter. (d) When there have been similar complaints made or where there exists other evidence which, in the judgment of the City Manager, casts doubt on the reliabil- ity or quality of cable service, or the Grantee's ability to meet the technical standards herein adopted, the City Manager shall have the right and authority to compel the Grantee to test, analyze, and report on the performance of that part of the system involved in the problem. Such test or tests shall be made and the reports of such test or tests shall be delivered to the City no later than fourteen (14) days after the City formally notifies the Grantee. Such report shall include the following • information: -15- (i) the nature of the complaint which precipitated the special test. (ii) what system component was tested. (iii) the equipment used and procedures employed in such testing. (iv) the names of the individuals performing and witnessing the testing. (v) the date, time, and location of testing. • (vi) the results of such test. (vii) the method in which such complaints were resolved. Any other information pertinent to the special test shall also be recorded. The resultant report shall be submitted to the City Manager. If, in the judgment of the City Manager and/or City Council, the resultant tests indicate the service problem(s) are preventable and within the Grantee's control, the City Manager shall file such a written notice to the Grantee to remedy the problem within a reasonable period, agreed to by both the City and Grantee. If within this time period Grantee fails to remedy the problem(s), the City may impose a penalty of up to Five Hundred Dollars ($500) for each occurrence or series of related occurrences, for each and every day the problem(s) remains uncorrected. (2) Remedies for Inadequate Service. The following • remedies and penalties for inadequate or untimely service to subscribers or system installation delays are hereby established: • (a) In the event that service to any subscriber is interrupted for twenty-four (24) consecutive hours, except for acts of God, and except in circumstances for which prior approval of the interruption is obtained from the City Council, Grantee shall provide a twenty percent (20%) rebate of the monthly fees during which the interrup- tion occurs, to all affected subscribers. (b) In the event that the system fails to meet any performance standards specified herein for a full three (3) month period, Grantee shall reduce all subscriber's fees by twenty-five percent (25%) until all performance standards are met. The City Manager shall notify the Grantee in writing during the first month of the three (3) month period that the system has failed to meet performance standards. (c) For failure to commence construction pursuant to Section 11-18(F) herein, unless the Council approves the delay because of reasons beyond the control of the Grantee, the franchise term shall be reduced four (4) days for each day of delay. -16- (d) For failure to begin service to subscribers or complete construction and installation of the system pursuant to Section 11-18(F) herein, unless the Council approves the delay because of reasons beyond the control of the Grantee, the franchise term shall be reduced four (4) days for each day of delay. (K) Periodic Testing and Reporting. The CATV system shall be tested, and the results reported to the City, on a scheduled basis as specified below: • (1) Quarterly System Tests. On the last regular working day of each of the first three (3) operating quarters of each year, the Grantee shall submit to the City Manager system performance data taken within the previous seven (7) days. Measurements for said data shall be taken at the same test points selected to satisfy Sub -section (2) below, during the last annual system performance test that the data has been submitted to the City. Quarterly test data shall consist of: (a) Visual signal level for all channels carried. (b) Visual signal-to-noise measurements on one active lowband and one active highband VHF channel. (c) Visual hum modulation on one channel or pilot carrier. A representative of the City shall be permitted to accompany the Grantee during quarterly measurement activities. The Grantee shall not be permitted to make any system adjustments during quarterly measurement activities without noting such adjustments on the test data form. (2) Annual System Tests. During the last month of • the fourth operating quarter of each year, the Grantee shall Perform annual performance tests of the system. 0 (a) Such tests shall be in full compliance with FCC regulations. (b) Such tests shall be independently witnessed and the resultant date analyzed by a representative of the City if directed by the City Manager. (c) All necessary test instrumentation shall be supplied by the Grantee. A current certificate of calibra- tion by an independent calibration laboratory shall be supplied for each test instrument. All costs for instru- mentation and calibration shall be borne by Grantee. (d) Measurement locations for system compliance with Sub -section (1) above, except those requirements regarding twenty-four (24) hour visual signal amplitude and channel amplitude characteristics, shall include: (i) end of each system major trunk, and, (ii) end of each system truck branch four (4) or more truck amplifiers deep. -17- Actual test locations shall be selected to measure performance of the system inthe franchise area and shall be (or as closely as possible to simulate) actual subscriber locations. (e) Measurements regarding twenty-four (24) hour visual signal level and channel amplitude character- istics shall be made as required by the FCC. (f) Measurement for system compliance with Sub -section (1) above, shall be made where practical on all origination equipment employed in the system. • (g) Measurement techniques shall be either (i) those suggested by the FCC, or, (ii) those developed and mutually agreed to in writing by the City and the Grantee prior to system testing. If such agreement is not reached prior to testing, the City shall prescribe acceptable methods of measurements. (h) Concurrent with annual performance tests, the City representative shall inspect all system headend facilities and outside plant for adherence to best industry installation, workmanship and safety practice. (i) If said proof of performance tests, or construction standards show that the cable television system is below the performance standards outlined in this franchise, the City shall give notice thereof to Grantee and Grantee shall have thirty (30) days to correct said deficiency. Grantee will notify the City when such correction has been made and the engineering firm employed in the previous test will retest to ensure compliance. In the event the resultant tests .reveal Grantee has failed to correct said deficiency(s), or if thirty (30) days has elapsed and Grantee has not corrected the deficiency, the City may request mutually agreed upon independent • engineers to demonstrate, at the Grantee's cost, the appropriate correction to the Grantee. Grantee shall then have sixty (60) days or other approved reasonable time required, to correct deficiency. If at the end of the approved time the deficiency still has not been corrected, the City shall have the option of implementing a penalty of Two Thousand Dollars ($2,000) per day for each and every day the deficiency exists. (3) Annual Service Report. The following information shall be reported to the City on an annual basis and the report shall be submitted to the City manager by not later than March 1 of the following year. (a) Existing Service Area. An outline of the existing service area with comments on small areas not actually served, areas where certain services are not yet available, or areas where special conditions exist. All special rate areas or isolated subscribers shall be indicated. (b) work in Progress. An indication on the map of areas where system construction or reconstruction is in progress plus a comment on the present status and anticipated schedule of completion of the work in each area. 0 (c) Proposed Service Area. An indication on the map of those areas where service is planned,and a schedule describing the planned implementation. (d) Special Service Points. Maps or lists indicating where any type of special service is available. (e) Statistics on Subscribers. The following numbers shall be supplied: single-family homes passed, single-family subscribers, multiple -dwelling unit sub- scribers, commercial subscribers, additional television outlets, and saturation (total subscribers divided by total dwelling units passed.) (f) Statisitcs on System Expansion. A listing of any expansion of the cable system including a measure, in miles of cable, of such expansion. Designations shall be included to identify expansions to new developments. (g) Technical Standards. A detailed, informa- tive, and referenced statement describing the actual equipment and operationals standards of the Grantee and the corresponding standards required by this Ordinance. Such statement shall be certified by a third party for accuracy. (h) Subscriber Agreements. Copies of new or revised subscriber agreements, if any. SECTION 11-19 PROPOSAL This Ordinance shall be incorporated by reference in any franchise award(s) and any and every provision of said Ordinance shall be incorporated as though the same were set out in full, and all provisions shall be binding upon Grantee. SECTION 11-20 FRANCHISE FEE • (A) Franchise Fee Amount and Payment. Any Grantee granted a franchise under this Ordinance shall pay to the City, during the life of such franchise, a sum equal to five percent (5%) of the annual total gross receipts and in addition thereto, such other sums as may be provided for elsewhere in this ordinance. If, during any part of the franchise term, a Federal or State limitation is imposed on the amount of the franchise fee percentage, such limitation shall apply only for the time period such limitation is legally operational. Franchise fee payment by the Grantee to the City shall be made semi-annually on June 30th, and December 30th, by delivery of the same to the City Treasurer. Franchise payments required hereunder shall be in lieu of any business licenses, occupation tax or similar levy. The Grantee shall file with the City Finance Director, within ninety (90) days after the expiration of the Grantee's fiscal year or portion thereof during which such franchise is in force, a balance sheet and statement of profit and loss prepared in accordance with generally accepted accounting standards and practices and certified by an independent Certified Public Accountant (CPA), showing in detail the gross receipts, as defined herein, of Grantee during the preceding fiscal year, or portion thereof. It shall be the duty of the Grantee to pay to the City, within fifteen (15) days after the time for filing such statements, the sum hereinabove prescribed -19- or any unpaid balance thereof for the fiscal year or portion thereof covered by such statements. (B) Inspection of Records. The City shall have the right to inspect and audit the Grantee's fiscal records. If any independent audit of the Grantee's records directed by the City show a franchise fee error in excess of two percent (2%) in the City's favor, the Grantee shall assume all reasonable costs for said audit. 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 additional sums payable under this Section or for the performance of any other obliga- tion hereunder. In the event the above payments are not received by the City within the specified time, Grantee shall pay to the City liquidated damages of two -percent (2%) per month on the unpaid balance in addition thereto. SECTION 11-21. APPLICATIONS FOR FRANCHISE (A) Each application for a franchise to construct, operate, or maintain any cable television systems in this City shall be filed with the City Clerk and shall 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 and to whatever extent required by the City. (i) The names and business addresses of all officers and directors of the applicant. If the applicant is a partner- ship or other unincorporated association, the name and address • of each member, whether active or inactive shall be set forth, and if one or more partners are corporations, the names addres- ses and occupations of such corporation's officers, directors and major stockholders shall also be stated. • (ii) The names and business addresses of all officers, persons and entities having, controlling or being entitled to have or control of 5% or more of the ownership of the applicant and the respective ownership share of each such person or entity. (iii) The names and addresses of any parent or subsidiary of the applicant, namely, any other business entity owning or controlling applicant in whole or part or owned or controlled in whole or in part by the applicant, and such a statement describing the nature of any such parent or subsidiary and the areas served thereby. (iv) A detailed description of all previous experience of the applicant in providing cable 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 accpetable evidence in writing =010 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 such lending instuti- tion or fudning 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 contruct and operate the proposed system in this City along with a statement setting forth the minimum amount of cash resources to be committed to the construction and operation of • the proposed system in the City. • (vi) A statement identifying by name, place, address, telephone number any other cable television franchise(s) awarded to the applicant, its parent or subsidiary; the status of said franchise(s) with respect to completion thereof; and the amount of applicants and its parents 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 map indicating all areas proposed to be served, and a proposed time schedule for the installation of all equipment necessary to become operational throughout the entire area to be served. (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 state- ment describing the actual equipment and operational standards proposed by the applicant. In no event shall said operational and performance standards be less than those contained in Title 47, Subpart K (Section 76-601 et seq.); Rules and Regulations, Federal Communications Commission, adopted February 2, 1972, and as amended. (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 or oral, or implied, existing or proposed to exist between the applicant and any person, firm, or corporation which materially relate to, materially pertain to, or materially 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. -21- (5) Any other details, statements, information or 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. (6) A non-refundable application fee which shall be in form of a certified or cashier's check or a money order in the amount of Seven -Thousand Five Hundred ($7,500.00) Dollars. (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 deter- minations and specify any other times, terms, conditions, or limitations respecting the soliciting, calling for, making and receiving of such applications. (C) Upon receipt of any application for franchise, the Council shall refer the same to the City Manager who shall prepare a report and make his recommendations respecting such applications, and cause the same to be completed and filed with the Council and the franchise applicants within ninety (90) days unless otherwise extended for additional period(s) of time by the City Council. (D) Upon receipt of said report and recommendations of the City Manager the Council shall: (1) Decide and specify the terms and conditions of any franchise to be granted hereunder and as herein provided. (2) Adopt a resolution of intention to consider the granting of such a franchise, and schedule a public hearing for such consideration, giving notice of receipt of the applica- tions, and describing the character of the franchise desired, the character of the franchise, the terms and conditions upon which such 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 of 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 in a newspaper of general circulation within the City at least ten (10) days prior to said hearing. • (E) At the time set for the hearing, or at any adjournment thereof, the Council shall proceed to hear all interested persons and any objections or protests to the granting of a franchise. In making any determination hereunder as to any application, the Council may give due consideration to the quality of the service proposed, rates to subscriber, income to the City, experience, character, background, financial responsi- bility of any applicant, and its management and owners, techni- cal and performance quality of equipment, willingness and ability to meet construction and physical requirements, and to abide by policy conditions, franchise limitations and require- ments, and any other considerations deemed pertinent by the Council for safeguarding the interests of the City and public. - 22- The Council, at its discretion, shall determine the award of any franchise on the basis of such considerations and without competitive bidding. (F) After the public hearing the Council shall make one of the following determinations: (1) That one or more of said applications for a franchise be denied which determination shall be final and conclusive; or • (2) That one or more of said applications for a franchise be granted upon the terms and conditions as specified in the resolution of intention to grant the same; or (3) That one or more of said applications for a franchise be granted, but upon the terms and conditions differ- ent from those specified in the resolution of intention to grant the same. (G) If the Council shall determine that an applica- tion or applications for a franchise be denied, such determi- nation shall be expressed by resolution and shall be final and conclusive. If the Council shall determine that an application or applications for a franchise be granted upon the terms and conditions as specified in the resolution of intention to con- sider granting the same, such determination shall be expressed by ordinance granting a franchise to the applicant or applicants. If the Council shall determine upon granting an application or applications for a franchise upon terms and conditions different from those specified in the resolution of intention to consider granting the same, then such determina- tions shall be expressed by resolution adopted prior to granting a franchise by ordinance. • (H) The Council may reject any and all applications and may, if it so desires, request new and/or additional proposals. The Council may at any time demand and applicant(s) shall provide such supplementary, additional or other informa- tion as the Council may deem reasonably necessary to determine whether the requested franchise should be granted. • SECTION 11-22. FRANCHISE TERM: DURATION, TERMINA- TION, PERIODIC REVIEW AND RENEWAL. (A) Duration. The franchise granted under this Ordinance shall be for a term not to exceed fifteen (15) years, from the date of its acceptance by the Grantee, as determined by the City Council. -23- (B) Termination. (1) The City may terminate any franchise granted pursuant to the provisions of this Ordinance in the event of the willful failure, refusal or neglect by Grantee to do or comply with any material requirement or limitation contained in this Ordinance, or any material rule or regulations of the Council or City Manager validly adopted pursuant to this Ordinance. (2) The City Manager may make written demand that the • Grantee do or comply with any such requirement, limitation, term, condition, rule or regulation. If the failure, refusal or neglect of the Grantee continues for a period of thirty (30) days following such written demand, the City Manager may place his request for termination of the franchise upon the next regular Council meeting agenda. The Council shall hold a public hearing to consider the City Manager's request. The City Clerk shall cause to be served upon such Grantee, at least thirty (30) days prior to the date of such Council meeting, a written notice of his intent to request such termination, and the time and place of the meeting. The City Clerk shall also publish a notice of. such a hearing, setting forth a time and place when and where any persons having any interest therein may appear before the Council and be heard, at least ten (10) days prior to the hearing in a newspaper of general circulation within the City. (3) The Council shall consider the request of the City Manager and shall hear any persons interested therein, and shall determine, in its discretion, whether or not any failure, refusal or neglect by the Grantee was with just cause. (4) 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. • (5) 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 by compliance by the Grantee within such period as the Council may fix, or reduce the length of the franchise by a period of time up to the duration of the failure and/or violation. (6) The termination and forfeiture of any franchise shall in no way affect any of the rights of the City under the franchise or any provision of law. (7) In the event of any holding over after expiration or other termination of any franchise granted hereunder, without the prior consent of the City, expressed by resolution, the Grantee shall pay to the City reasonable compensation, damages and penalties of not less than one hundred percent (100%) of all gross receipts during said period, unless an application for franchise renewal is pending before the Council. (C) Periodic Review. Every five (5) years, commencing with the date of franchise adoption, the City may review any existing franchise and adopt, by resolution, any modifications that may be deemed reasonably necessary for the public health, • safety or welfare. Such resolution shall only be adopted after -24- a public hearing. The City Clerk shall publish a notice of any such hearing, setting forth a time and place when and where any person having any interest therein may appear before the Council and be heard, at least ten (10) days prior to the hearing in a newspaper of general circulation within the City. The City Clerk shall also cause a copy of such notice to be mailed to Grantee at least ten (10) days prior to the hearing. No modifications to the existing franchise may be made which will substantially amend the existing contractual rights and obligations of the Grantee without Grantee's consent. (D) Renewal. Any franchise granted under this • Ordinance is renewable at the application of the Grantee, in the same manner and upon terms and conditions mutually accepta- ble to the City Council and Grantee. (1) Within two (2) years of the expiration date of this franchise, Grantee shall file notice of request for renewal of the franchise. Such request shall, at the minimum, specify the following: (i) Justification, based on prior experience, for the extension. (ii) Number of years of the requested franchise extension. (iii) Changes, modifications, improvements, such as an increase in channel capacity, services provided, or other additions/deletions Grantee is proposing to provide during the term of the requested extension. (iv) Proposed rate schedules for all services and level of services proposed. (v) Any and all other information Grantee shall deem relevant to the request. • (2) Within ninety (90) days of receipt of the Grantee's application for franchise renewal, the City shall schedule hearings on the request with Grantee. A final deci- sion and agreement between Grantee and the City shall be resolved at the earliest possible date, but in no event, later than eighteen (18) months prior to the expiration of the existing franchise. In the event agreement is not concluded prior to that time, notice shall be extended to the Grantee of the City's intent to reopen the franchise to interested appli- cants. 0 SECTION 11 -23. BONDS, INDEMNIFICATIONS, INSURANCE (A) Security Fund. (1) Within thirty (30) days after written notificaton of the award of a franchise by the City, the selected applicant shall deposit with the City and maintain on deposit throughout the term of the franchise a security fund in the sum of one hundred fifty thousand dollars ($150,000) in cash as security -25- for the faithful performance by grantee of all provisions of this Chapter and the franchise and compliance with all orders, permits and directions of any agency or department of the City having jurisdiction over grantee's operations. (2) Within fifteen (15) days after written notice to grantee by the City that the City has withdrawn any amount from the security fund, grantee shall deposit or pay to the City a sum of money sufficient to restore such security fund to the original amount of one hundred fifty thousand dollars ($150,000). (3) If grantee fails to pay the City any monies due • within the time fixed in this Chapter or the franchise or fails after ten (10) days' written notice to pay to the City any taxes due and unpaid; or fails to repay to the City within ten (10) days' written notice, any damages, penalties, costs or expenses which the City may be compelled to pay by reason of any act, omission or default of grantee; or fails after ten (10) days' written notice to comply with any provision of this Chapter or the franchise which the City reasonably deter- mines can be remedied or partially cured by an expenditure from the security fund, the City may immediately withdraw the amount thereof, with interest and any penalties, from the security fund. Upon such withdrawal, the City shall in writing notify grantee of the amount and date thereof. In the event the security fund is insufficient to pay the City for any compensa- tion, damages, penalties, costs of expenses owing to the City pursuant to this Chapter or the franchise, the performance bond may be drawn upon by the City for any amount due the City over and above the amount held in the security fund. (4) The security fund, including any interest that may have accrued, shall become the property of the City in the event that a .franchise is terminated by the City by reason of a violation of this Chapter or breach of the franchise pursuant to the provisions of Section 11-22 hereof. (5) Upon application to the City, grantee shall be • entitled to the return of all monies remaining in the security fund, including accrued interest, at the expiration of the franchise or any renewal thereof, provided there is then no outstanding default of monies owing on the part of grantee to the City. • (6) The rights reserved to the City with respect to the security fund are in addition to all other rights of the City, whether reserved by this Chapter or authorized by law, and no action, proceeding or exercise of a right with respect to such security fund shall affect any other right the City may have. (B) Performance Bond to City. Upon being granted a franchise, and upon the filing of the acceptance required under Section 11-24 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 the amount of seven million dollars ($7,000,000). 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, -26- then there shall be recoverably jointly and severally from the principal and surety any damages of 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 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 thereunder shall be construed to excuse faithful perform- ance by the Grantee , or limit the liability of the Grantee under any franchise issued pursuant to this ordinance or for damages either to the full amount of the bond, or otherwise. (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, demands, causes of action, actions, suits, proceedings, damage (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 the owners of authorized distributors or licensees of programs delivered by Grantee's cable television system), costs or liabilities of every kind and nature whatsoever, including but not limited to damages for injury or death or damage to person or property, caused solely by the negligent act or omission of Grantee, its officers, agents, and employees in the exercise of any of its rights or privileges under its franchise hereunder. The term "costs or liabilities" includes but is not limited to, reasonable attorney's fees, reasonable accountant's fees, reasonable expert witness or consultant fees, reasonable per diem expenses and travelling expenses for witnesses, and • court costs of any trial. (D) Defense of Litigation. Grantee shall at the sole risk and expense of Grantee, upon demand of the City, made by and through the City Attorney, appear in and defend any and all suits, actions, or 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, or arising our 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 shall cause to be paid and satisfied any judgement, decree, order, directive, or demand rendered, made or issued against Grantee, the City, its officers, boards, commissions, agents, or employees, in any of these premises; and such indemnity shall exist and continue without reference to or limitation by the amount of any bond, policy of 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 without first obtaining the written consent of the other. -27- (E) Expenses of Litigation. In the event of any legal action between Grantee and the City arising out of any alleged breach by Grantee of any term of condition or provi- sions of this franchise, the successful party shall be entitled to reasonable attorney's fees, and court costs related to the litigation, in addition to any other judgment or order by the court of competent jurisdiction. (F) Insurance Required. Grantee shall, concurrently, with the filing of an acceptance of award of any franchise granted under this Ordinance, furnish to the City and file with the City Clerk, and at all times during the existence of • any franchise granted hereunder, maintain in full force and effect, at its own cost and expense a general comprehensive liability insurance policy, including coverage for, premises - operations, explosion and collapse hazard, underground hazard, contractual insurance, broad form property damage, independent contractors and personal injury and automobile liability comprehensive form, in protection to the City, its officers, boards, commissions, agents and employees, in a company approved by the City Manager and a form satisfactory to the City Attorney, protecting the City and all persons against liability for loss or damage for personal injury, death and liability for loss or damage for personal injury, death and property damage occasioned by the operations of Grantee under such franchise, with minimum liability limits of Two Million Dollars ($2,000,000) for personal injury or death of any one person or Five Million Dollars ($5,000,000) for personal injury or death of two or more persons in any one occurrence, and Two Million Dollars ($2,000,000) for damage to property resulting from any one occurrence. The City shall be named as an additional insured in all of said insurance policies. Where such insurance is provided by a policy which also covers Grantee or any other entity or persons, it shall contain the standard cross -liability endorsement. Such policies shall contain a provision that a • written notice of cancellation or reduction in coverage of said policy shall be delivered to the City Clerk ninety (90) days in advance of the effective date thereof. • Said insurance policy shall contain the following endorsements: 1. The naming of an additional insured as herein provided shall not affect any recovery to which such additional insured would be entitled under this policy if not named as such additional insured, and 2. The additonal insured named herein shall not be held liable for any premium or expense of any nature on this policy or any extension thereof, and 3. The additional insured named herein shall not by reason of being so named be considered a member of any mutual insurance company for any purpose whatsoever, and 4. The provisions of the policy will not be changed, suspended, cancelled or otherwise terminated as to the interest of the additional insured named herein without first giving such additional insured ninety (90) days written notice. Q►4:10 5. Any other insurance held by the additional insured shall not be required to contribute anything toward any loss or expense covered by the insurance which is referred to by this certificate. Grantee shall also, concurrently, with the filing of an acceptance of the award of any franchise granted under this Ordinance, furnish to the City and file with the City Clerk a certificate of Workmen's Compensation Insurance and at all times during the existence of any franchise granted hereunder, maintain in full force and effect, at its own cost and expense • a policy of Worker's Compensation Insurance. • SECTION 11-24. ACCEPTANCE OF THE FRANCHISE (A) No franchise granted under this Ordinance shall become effective for any purpose unless and until written acceptance thereof 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 o'clock p.m. of the twenty-fifth (25th) day following the effective date of the resolution granting such franchise. (C) In default of the filing of such written accept- ance as herein required, the Grantee shall be deemed to have rejected and repudiated the franchise. Thereafter, the accept- ance of the Grantee shall not be received nor filed by the City Clerk. The Grantee shall have no rights, remedies, or redress under that franchise unless and until the Council, by resolu- tion, 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 continu- ously 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 ordinance shall be in lieu of any and all other rights, privi- leges, powers, immunities, and authorities owned, possessed, controlled, or exercisable by the Grantee, of or pertaining to the contruction, operation or maintenance of any cable televi- sion systems in the City. SECTION 11-25. LIMITATIONS OF FRANCHISE (A) Every franchise granted under this chapter shall be non-exclusive. Neither the granting of any franchise hereunder nor any of the provisions contained herein shall be construed to prevent the City from granting any identical or similar franchise to any other person, firm, or corporation, within all or any portion of the City. =29- (B) No privilege or exemption is granted or con= ferred by any franchise granted under this chapter except those specifically described 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 force or involuntary sale, or by voluntary sale, merger, consolidation or otherwise, without prior consent of the Council expressed by resolution, and then only under such conditions, as may therein be pre- scribed. The said consent of the Council may not be reasonably refused; provided however, the proposed assignee shows financial responsibility as determined by the Council and agrees to comply with all provisions of the chapter; and provided further, should the Council so elect, that the original grantee agrees to continue to be bound by the security fund, performance bond, insurance, hold harmless, and indemnification provisions of Section 11-23 hereof. 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 25% of the market value of the property used by the franchise in the conduct of the cable television system, prior consent of the Council shall be required for such a transfer. Any sale, transfer, assignment or other disposition as described above 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 transfer or assignment. In the event the Grantee is a corporation, prior approval of the City Council, expressed by resolution, shall be required where there are actual changes in control or where ownership of more than 5% of the voting stock of Grantee is acquired by a person or group of persons acting in concert, none of whom already own 50% or more of the voting stock, single or collectively. Any such acquisition occurring without prior approval of the City Council shall constitute failure to comply with a material requirement of this Ordinance within the meaning of Section 11-22(B) herein. The entry into a "Close Corporation" management agreement by the corporation and/or its stockholders shall be deemed a sale, transfer, or assignment within the meaning of this section. (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) Any such franchise granted shall not relieve the Grantee of any obligations involved in obtaining pole or -30- conduit space from any department of the City, utility company, or from others who maintain utilities in the streets. (H) 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. (I) The Grantee shall be subject to all requirements of City laws, rules, regulations, and specifications heretofore, or hereafter enacted or established. • (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 of any and all of such rights, privileges, powers, immunities, and authorities within the City, to the effect that, as between Grantee and 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 hereunder or pursuant to any other right, privilege, power, immunity, or authority whatsoever. SECTION 11-26. RIGHTS RESERVED TO THE CITY (A) Nothing in this franchise shall be deemed or construed to impair or affect, in any way, to any extent, the right of the City to acquire any property of the Grantee, either by direct purchase or through the exercise'of the right of eminent domain, at a fair and just value, which shall not include any amount for this franchise itself or for any of • the rights or privileges granted by this franchise, and nothing herein contained shall be construed to contract away or to modify or abridge, either for a term or in perpetuity, the City's right of eminent domain. In the event the City wishes to acquire part or all of the cable system either by purchase or through the exercise of the right of eminent domain, City and Grantee will each appoint one appraiser to establish the value of the equipment to be acquired by City. The two appraisers will select a third appraiser who wlil be chairman of the appraisal board. The board will by majority vote, determine the value of the system to be acquired by City. This value will be final and binding on both City and Grantee and will be used as the purchase price of just compensation in an eminent domain proceeding between City and Grantee. In the event of purchase by the City, or a change of Grantee, the current Grantee shall cooperate with the City, or with a representative appointed by the City, to operate the system for a temporary period in maintaining continuity of service to all subscribers. (B) There is hereby reserved to the City every right and power which is required to be herein reserved or provided by any Ordinance of the City, and the Grantee by its acceptance of this franchise, agrees to be bound thereby and to comply with any action or requirement of the City in its exercise of such • rights or power, heretofore or hereafter enacted or established, provided that such requirements are not inconsistent with the terms of this Ordinance. -31- • (C) Neither the granting of this franchise nor any provision hereof shall constitute a waiver or bar to the exercise of any governmental right or power of the City. (D) The Council may do all things which are necessary and convenient in the exercise of its jurisdiction, and may determine any question of fact which may arise by reason of the existence of this franchise. The City Manager is hereby authorized and empowered to adjust, settle or compromise any controversy, or charge arising from the operations of the Grantee under this franchise, either on behalf of the City, the Grantee, or any subscriber, in the best interest of the public. SECTION 11-27. COUNCIL TO ADOPT RULES AND REGULATIONS The Council may at any time adopt new rules or regulations or standards, or may amend, modify, delete, or otherwise change its respective rules or regulations or stan- dards previously adopted, in the following manner: (A) The Council shall pass its resolutions of intention of 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. (B) 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. (C) 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. (D) Any rule or regulation or standard as adopted, amended, modified, deleted, or otherwise changed by the Council shall become effective upon the tenth (loth) day following the adoption of such resolution, unless a longer period shall be otherwise provided in such resolution. SECTION 11-28. RATES, CHARGES AND RATE INCREASES. The service rates and installation and connection charges for CATV system use, as contained in the Grantee's proposal, and as adopted or amended by Council, may be changed from time to time by resolution of the City Council, pursuant to this Section. All such rates and charges shall remain in effect with no increase for the period of time indicated in Grantee's proposal, or such time as is adopted or amended by City Council. In no event shall that term be less than three (3) years from award of franchise. All rate and charge increase requests submitted or proposed by Grantee after said time period shall be based upon the following criteria which shall be considered and evaluated by the City Council: • -32- (A) The initial rates as hereinabove set may be adjusted after the initial three (3) year period and at such time thereafter as hereunder specified, based upon the Consumer Price Index (CPI), Urban Wage Earners, prepared by the Bureau of Labor Statistics of the United States Department of Labor, relating to all items, Series A for the Los Angeles/Long Beach area (1967=100), or some substantially similar index in the event the Consumer Price Index is discontinued, in accordance with the following formula: (1) The Grantee shall submit to the City by September 1 of each year a report of the most recent CPI information for • the twelve (12) month period preceding the report. (2) The number of points of increase or decrease in the CPI for said twelve (12) month period, divided by the index base of one hundred (100) shall be used as the total annual percentage increase in the CPI. ° (3) The Grantee may request and the City shall thereon grant, a rate increase in the amounts requested by Grantee, provided that: a. the amount of such rate adjustment divided by the current subscriber rates shall not exceed seventy-five percent (75%) of the total annual percentage increase in the CPI as determined under subparagraph (2) above, and b. The Grantee provides the City with written financial statements showing that the rate adjustment is justified by increased expenses incurred by the Grantee in the operation of its CATV system. (4) Any application by the Grantee for a rate increase shall be accomplished and supported by the following information: • a. Copies of financial reports and income statements prepared in accordance with generally accepted accounting standards and practices and certified by an independent certi- fied public accountant (CPA) for at least the preceding three (3) years. If the Grantee is a subsidiary of another firm, similar financial data shall be furnished for the parent corporation. 0 b. An itemization of capital assets, both tangible and intangible, the accounting basis for depreciation and the depreciation schedule. If intangible assets such as goodwill are being amortized, the amortization period shall be stated. C. A detailed breakdown of operating, marketing and general and administrative costs by category for each of the three (3) preceding years. d. The number of subscribers for "basic cable service" and "premium cable service" for each of the three (3) preceding years. -3 3- e. The number of cable plant -miles and dwelling units passed by the cable plant for each of the three (3) preceding years. f. A statement as to any allocation of funds to parent company overhead or operating costs, and the basis for such allocation. (B) Upon receipt of a rate increase request, accom- panied by all of the supporting information of (a) above, it shall be the obligation of the City Council to act upon this request within a period of sixty (60) days from the date upon • which all supporting materials have been submitted in adequate form. Prior to taking action on the request at least one (1) noticed public hearing shall be held upon the rate increase. The Council shall approve, partially approve, or disapprove, any increase of rates or rates for additional services on the basis of the following consideration. (1) Performance of the Grantee in abiding by the terms and conditions of this Ordinance. (2) Whether the Grantee has adquately served or serviced the subscribers in the City and the community in general. (3) Rates for comparable CATV service(s) in surrounding communities. (4) Revenue and profits from services offered. (5) Operating and construction expenses of the system. (6) Completeness of the information submitted by Grantee in support of the request for increases. • (7). Other such evidence or testimony as may arise during the public hearing. • The decision by the City Council approving, partially approving, or disapproving the request for increase shall not be unreason- able withheld and such decision shall be in resolution form, which shall contain finding indicating the basis for the decision and any new rates or charges thereby approved and adopted. Any increase in rates or charges thereby approved shall become effective thirty (30) days after the date of approval of the resolution. (C) In the event a rate increase is granted as requested, the Grantee shall refrain from applying for further increases for a period of fifteen (15) months from the effective date of the prior increase. If the rate request is denied, or a lesser increase than requested is approved, the Grantee shall refrain from applying for further increases for a period of six (6) months from the date of the resolution denying the request or approving the lesser request. In accepting the franchise granted hereby, Grantee shall be deemed to have knowingly, intentionally, and permanently waived and relinquished any and all of its rights to elect to be exempt from the City's regulation and control of its rates charged to subscribers within the City of West Covina, pursuant -34- to the provisions of California Government Code Section 53066.1 (Assembly Bill 699), any successor provision or provisions thereto or any other provision or provisions of law. SECTION 11-29. Right to Privacy of Subscribers As used in this section, "valid authorization" shall mean written approval from the subscriber for a period of time not to exceed one year. (A) Each franchise shall strictly observe and protect the rights of privacy and of property of subscribers • and users at all times. Information on individual sub- scribers, individual subscriber preferences of any kind, viewing habits, political, social or economic philosophies, beliefs, creeds, religions or names, addresses or telephone numbers shall not be revealed to any person, governmental unit, police department, investigating agency, company, other agency or entity, unless upon the authority of a court of law, or, upon prior written permission of the subscriber. The request for permission must be contained in a separate document with a prominent statement that the subscriber is authorizing the permission in full knowledge of its provision. Such authorization shall not in any event be required as a condition of receiving service. (B) A Grantee may release the number of its sub- scribers but only as a total number and as a percentage of the potential subscribers throughout the City. When indicating the number of subscribers viewing a particular channel at a particular time, franchisee shall indicate only the total number of subscribers viewing during the relevant time and the percentage of all subscribers which they represent, but never the identity of a particular subscriber. (C) A Grantee may maintain such information as is necessary to bill subscribers for the purchase of any system • service. (D) Neither a Grantee nor any other person shall initiate in any form, the discovery of any information on or about a subscribers premises without prior valid authorization from the subscriber potentially affected. n U (E) A subscriber may, at any time, revoke any authorization previously made, by delivering to franchisee in writing, by mail or otherwise, his/her decision to so revoke. Any such revocation shall be effective upon receipt by fran- chisee. (F) No monitoring of any subscriber terminal shall take place without specific prior valid authorization by the user of the terminal in question, provided, however, the franchisee may conduct systemwide or individually addressed "sweeps" for the purpose of verifying system integrity, security monitoring, and/or other addressable premium service implementa- tion or verification which the subscriber has contracted for. In no event shall residential aural or visual monitoring of any kind take place without a clear indication to the subscriber that such monitoring is taking place. (G) A Grantee may, without prior subscriber approval, monitor those subscriber terminals which are connected to -35- utility monitoring devices which measure utility usage and which have been first approved by the City Council. (H) Prior to implementation of any interactive subscriber response mechanism, the Grantee must first demon- strate to the City Manager that such a system can operate effectively and provide absolute protection against any invasion of privacy. (I) A Grantee shall not tabulate any test results, nor permit the use of the system for such tabulation, which would reveal the commercial product preferences or opinions • of subscribers, members of, their families or their invitees, licensees or employees, without prior valid authorization of the subcriber. C� J • (J) Each compilation, publication, tabulation or other dissemination of each piece of information made or permitted to be made in violation of this Section shall be considered a separate violation and subject to a fine of Five Thousand Dollars ($5,000). SECTION 11-30. RIGHT OF INTERVENTION The City may intervene in any suit or proceeding in which the Grantee is a party, provided that the City interests are not adequately represented by the existing parties, and provided further, that the disposition of each suit or proceed- ing without the Grantor's participation may, as a practical matter, impair or impede the City's ability to protect those interests. SECTION 11-31. EFFECT OF ANNEXATIONS (A) In the event any new territory shall be annexed to the City which is contiguous to only one franchise area in the City, such new territory shall become, by operation of law, a part of such franchise area immediately upon the effective date of such annexation. (B) In the event any new territory shall become annexed to the City which is contiguous to more than one franchise area in the City or is not contiguous to any fran- chise area, then the Council shall determine at a public hearing, which Grantee or Grantees, if any, shall serve such new territory. . (C) In the event any portion of the unincorporated territory covered by an existing franchise or license granted by the County of Los Angeles is annexed to the City prior to the time that the Grantee of such County franchise or license has commenced installation of a CATV system within said terri- tory, all rights acquired by said Grantee under its County franchise or license shall terminate by operation of law as of the date on which the annexation to the City becomes effective. (D) In the event any portion of unincorporated territory covered by an existing franchise or license granted by the County of Los Angeles is annexed to the City after the Grantee thereof has commenced or completed construction and installation of a CATV system within said territory, the rights reserved under such franchise or license to the County of Los Angeles or to any officer thereof, shall inure to the benefit -36- • of the City and all regulatory provisions of this Ordinance and any other rules and regulations applicable to CATV systems operating within the City, whether then in effect or subse- quently adopted, shall be applicable to and binding upon said Grantee. In addition, the Grantee shall be obligated to pay annually to the City, the percentage of the gross receipts established by the County of Los Angeles in said franchise or license which are derived from its operations within the annexed territory for five years or upon termination of the franchise, whichever is of the shorter time duration, at which time the Council may establish the percentage of gross receipts to be paid to the City. SECTION 11 - 32. SAFETY REQUIREMENTS (A) 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. (B) The Grantee shall install and maintain its wires, cables, fixtures, and other equipment in accordance with the requirements of the National Electrical Code, as it now exists or hereafter may be amended and in such manner that they will not interfere with any installations of the City or of a public utility serving the City. (C) All structures and all lines, equipment, and connections in, over, under, and upon the streets, sidewalks, alleys, and public ways or places of the City, wherever situated or located, shall at all times be kept and maintained in a safe, suitable substantial condition, and in good order and repair. (D) The Grantee shall strictly adhere to all building and zoning codes currently or hereafter in force. The Grantee • shall arrange its lines, cables, and other appurtenances on both public and private property, in such a manner as to cause no unreasonable intereference with the use of said public or private property by any person. • SECTION 11-33. REMOVAL OF FACILITIES UPON REQUEST Upon termination of service to any subscriber, the Grantee shall promptly remove all its facilities and equipment from the premises of such subscriber upon his request. SECTION 11-34. COSTS TO BE BORNE BY GRANTEE. (A) As required by Section 11-22(a)(6) all franchise applicants shall submit a non-refundable application fee of seventy five hundred dollars ($7500). Such fees will serve to recover all expenses incurred by the City in the preparation and granting of the franchise and regulation of the franchise pursuant to this chapter. Said expenses shall include, but not limited to, all publication costs, consultant's expenses, and the reasonable value of serviced performed by the City's employees, agents, or contractors. (B) In the event that expenses exceed the total amount of filing fees collected from the applicants, the Grantee shall pay to the City (pro rata in the event that there -37- is more than one grantee) the excess amount. Upon award of the franchise, the City will present Grantee an itemization of all such expenses and indicate the total application fees received. Upon acceptance of the franchise as specified by Section 11-24, Grantee shall pay to the City by certified or cashier's check, the excess of expenses less fees received. (C) Notwithstanding any other payment required by this chapter, including all fees related to construction (i.e. construction and excavation fees and permits, inspection fees, etc.) when necessary to aid in the analysis of matters relating to the franchise, including, but not limited to, rate investiga- tion and regulation, technical standards, construction supervision or market surveys in the City, the City shall be entitled to employ the services of a consultant. All reasonable fees of hte consultant incurred by the City in this regard shall be shared equally by Grantee and the City, regardless of the nature or outcome of any specific matter under consideration. The terms of this section shall not apply to any research cost incurred by the City in connection with the right of the City to purchase the system. SECTION 11-35. RECEIVERSHIP Upon the foreclosure of other judicial sale of all or a substantial part of the CATV System, or upon the termination of any lease covering all or a substantial part of the CATV system, the Grantee shall notify the City Clerk of such fact, and such notification shall be treated as a notification that a change in control of the Grantee has taken place and the provisions of this ordinance governing the consent of the Council to such change in control of the Grantee shall apply. The City shall have the right to revoke the franchise one hundred and twenty (120) days after the appointment of a receiver, or trustee, to take over and conduct the business of the Grantee, whether in receivership, reorganization , bank - is ruptcy, or other action or proceeding, unless such receivership or trusteeship shall have been vacated prior to the expiration of said one hundred and twenty (120) days, or unless: (A) Within one hundred and twenty (120) days after his election or appointment, such receiver or trustee shall have fully complied with all the provisions of the franchise and remedied all defaults thereunder; and (B) Such receiver or trustee, within said one hundred and twenty (120) days shall have executed an agreement, duly approved by the court having jurisdiction in the premises, whereby such receiver or trustee assumes and agrees to be bound by each and every provision of the franchise. SECTION 11-36. AUTHORITY OF CITY TO TERMINATE IN THE EVENT OF CONDEMNATION In order to preserve the right of the City under the franchise provided for, and its right to acquire the property of the Grantee by purchase or by eminent domain proceedings at its then fair market value, at any time during the existence of the franchise, it is especially provided that if at any time the franchise or the property of the Grantee under the fran- chise shall become the subject of eminent domain proceedings by. the City, the City reserves and shall have the right at the • time such proceedings are commenced, or at any time thereafter, to terminate said franchise by resolution. CKM SECTION 11-37. CONTINUITY OF SERVICE MANDATORY It shall be the right of all subscribers to receive all available services insofar as their financial and other obligations to the Grantee are honored. In the event that the Grantee elects to overbuild, rebuild, modify, or sell the system, or the City revokes or fails to renew the franchise, the Grantee shall do everything in it power to ensure that all subscribers receive continuous, uninterrupted service regard- less of the circumstances during the lifetime of the franchise. In the event of purchase by the City or a change of Grantee, the current Grantee shall cooperate with the City to operate • the system for a temporary period, in maintaining continuity of service to all subscribers. SECTION 11-38. FINANCIAL DISCLOSURE OF INDEPENDENT CONSULTANT Any individual, partnership or corporation employed by the City for the purposes of advising the City, its council, its commissions city manager, or staff, on matters relating to cable television, or reviewing and evaluating, or assisting the City in reivewing and evaluating, proposals for the construc- tion and operation of a cable television system (s), or regu- lating, or assisting the City in regulating, a cable television system, shall, as a term condition of their employment, file with ten (10) days of the date of employment with the City Clerk, a statement containing : (A) A listing and description of any financial and/or ownership held by the consultant in any cable television company, any subsidiary of affiliate of any cable television company, any company which is a supplier or customer of any cable television company, or in other company which owns stock or has any interest in any of those types of companies which are described in this section. If the consultant is a partner- ship, the financial and/or ownership interests in cable tele- vision companies affiliates, subsidiaries, suppliers, and customers of any partner must be disclosed. If the consultant is a corporation, the financial and/or ownership interests in cable television companies, affiliates, subsidiaries, suppliers, and customers of any shareholder, officer or directors must be disclosed. (B) A listing and description of any cable television company, affiliate, subsidiary, supplier or customer which the consultant has represented, on a compensated or non -compensated basis, within the last fifteen (15) years. The statement filed pursuant to this section shall be a public document open to inspection by any person. Failure to file this statement, or the inclusion of a material misrepre- sentation or omission within the statement, shall constitute grounds for the City's termination of the employment contract. This provision shall not apply to individuals who are subject to the reporting requirements of the "Political Reform Act of 1974" (California Government Code Sections 81008 et seq.) under the local Conflict of Interest Code if the disclosures required by the Code are substantially similar to those of this section. SECTION 11-39. MISCELLANEOUS PROVISIONS (A) A franchise granted to provide service within the . City shall authorize and permit the Grantee to solicit, sell, -39- • 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 a 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, distri- bute, 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 service system of Grantee. (C) No franchise granted under this Ordinance shall ever by given any value by any Court or other public authority 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 provision 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, 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 shall also 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 tele- vision sets or radios; (2) Imposing a fee or charge for repair to subscriber - owned receiving devices except for the connection of its service or for the determination by Grantee of the quality of his signal to the recipients thereof; (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; (F) If the Federal Communications Commission or the Public Commission of the Sate 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 jurisdic- tion shall preempt or preclude the exercise of like jurisdic- tion by the City the jurisdiction of the City shall cease and no longer exist. The premption or preclusion of the exercise -40- of the City or any of its police power shall not diminish, impair, alter or affect any contractual benefit to the City or Grantee nor 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 to determine, establish, or fix any of the same, are each and all hereby declared by the City and by a 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 distribution lines are in place, shall be refused service; provided however, that the Grantee shall not be required to provide service to any sub- scriber who does not pay the applicable connection fee or service charge. (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 (name of company) is making use of public rights -of - way within the City of West Covina and that the continued use of such rights -of -way is in no way guaranteed. In the event the continued use of such rights -of -way is denied to (name of company) for any reason, • (name of company) 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 West Covina, its officers, or its employees if the service to be provided hereunder is interrupted or discontinued." • (J) Grantee shall make available to all subscribers, upon demand and at no charge, parental control devices to control the viewing of programming. SECTION 11-40. EQUAL OPPORTUNITY EMPLOYMENT AND AFFIRMATIVE ACTION PLAN 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 employ- ment because of race, creed, color, sex, age, or national origin. 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 action shall include, but not be -41- limited to, the following: employment, upgrading, demotion or termination, rates of pay or other forms of compensation, and selection for training, including apprenticeship. The Grantee shall post in conspicuous places, avail- able to employees and applicants for employment, notices setting forth the provisions of this non-discrimination clause. The Grantee shall, in all solicitations or advertise- ments for employees placed by on or behalf of the Grantee, state that all qualified applicants will receive consideration for employment without regard to race creed, color, sex, age or • national origin. The Grantee shall incorporate the foregoing require- ments in all of its contracts for work relative to construction, maintenance and operation of the cable television system, other than contracts for standard commercial supplies or raw materials, and shall require all of its contractors other than those contractors or subcontractors employing less than five (5) employees for such work to incorporate such requirements in all subcontracts for such work. SECTION 11-41. VIOLATIONS (A) From and after the effective date of this Ordin- ance, 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 the 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; or, unless specifically permitted by the Council as expressed by resolution. (B) It shall be unlawful for any person, firm, or corporation to make or use any unauthorized connection, whether physically, electrically, acoustically, inductively or otherwise within this City for the purpose of enabling himself or others to receive or use any television signals, radio signals, 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 Grantee, to willfully tamper with, remove or injure any cables, wires, or equipment used for distribution of television signals, radio signals, pictures, programs or sound. SECTION 11-42. 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 • -42- `f ,OF of the fact that any one or more sections, subsections, sen- tences, 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 11-43. EFFECTIVE DATE This Ordinance shall go into effect and be in full force and effect from and after thirty days (30) after its final passage and adoption. SECTION 11-44. The City Clerk shall certify to the passage and adoption of this Ordinance; shall enter the same in the book of original ordinances of said City; shall make a minute of the passage and adoption thereof in the records of the proceedings of the City Council, at which the same is passed and adopted; and shall within fifteen (15) days from the passage and adop- tion thereof cause the same to be published once in the West Covina News, a weekly newspaper of general circulation,, published and circulated within said City of West Covina, and which is hereby designated for that purpose. October PASSED _AND APPROVED and ADOPTED this 25th day of 1982. 2�12;f_ r Mayor ATTEST: • x�4tx City Clerk State of California ) County of Los Angeles ) ss City of West Covina ) I► HelpnP M_ Monna _, City Clerk of the City of West Covina do hereby certi y that the foregoing Ordinance No. 1563 was regularly introduced and placed upon its first reading at a regular meeting of the City Council on the •12th day of October, 1982. That, thereafter, said Ordinance was duly adopted and passed at a regular meeting of the City Council on the 25th day of October, 1982, by the following vote to wit: AYES: Councilmen: NOES: Councilmen: ABSENT: Councilmen: 0 APPROVED AS TO FORM: e4. P. City Attorney Bacon, Shearer, Tice None Tennant, Chappell —43— " Cit C e k