HomeMy WebLinkAboutORD FOR ADOPTION 03-19-84 ~ ORDINANCES FOR ADOPTION
Inter-Corn
DATE:
FROM:
SUBJECT:
WILLIAM HUSTON, CITY MANAGER
JAMES G. ROURKE, CITY ATTORNEY
CATV FRANCHISE ORDINANCE
We have now been advised by representatives of communiCom and
united Cable that the ordinance which was given a first reading
at the last Council meeting is satisfactory to ~ommuniCom and
united Cable with one modification in Paragraph 2~ to-wit, as
now revised this paragraph provides that if the CTty elected to
purchase the CATV system because of changes in state or federal
laws relative to CATV which materially and adversely affected the
franchise, the City could buy the system at a price equal to its
then fair market value and would have the right to pay for the
system over a period of years out of revenues, or "such other
method of payment legally permissible and fiscally sound."
I recommend that the ordinance be given its second reading
and adoption. The change in the ordinance from its fir'st reading
at the last City Council meeting is sufficiently insubstantial so
that it may now be legally given its second reading and adoption.
JGR:se:D:3/12/84(17)
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Rourke & Wood uiT
SUtT~' IO20
SANTA ANA~ CALIFORNIA 92701
March 6, 1984
Laurence K. Gould, Jr.
SHEPPARD, MULLIN, RICHTER & HAMPTON
Forty-Eighth Floor
333 South Hope Street
Los Angeles, california 90071
BY MESSENGER
RE: CommuniCom - Tustin
Dear Mr. Gould:
Enclosed is draft of the CATV ordinance revised in
accordance with the conversations of yesterday.
I would remind you and your clients that at least some of
the members of the City Council want guarantees of United Cable.
I have left out the guarantee by united Cable as you had struck
it in the draft that was given to the Council last night. How-
ever, United may need to deal with this issue further, united
might satisfy the Council through a written statement to the
Council describing the financial strength of the limited partner-
ship.
If you have any questions, pleae advise.
JGR:se:D:03/06/84(33)
Enclosure as cited.
cc: W~
Very truly yours,
City of Tustin
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ORDINANCE NO. 905
AN ORDINANCE OF THE CITY OF TUSTIN, CALIFORNIA,
AMENDING THE FRANCHISE FOR A CABLE TELEVISION
SYSTEM GRANTED TO SIX STAR CABLEVISION OF TUSTIN,
INC. AND APPROVING THE TRANSFER OF OWNERSHIP FROM
SIX STAR CABLEVISION OF TUSTIN, INC. TO UNITED
CABLE OF SOUTHERN CALIFORNIA, LTD.
The City Council of the City of Tustin, California, hereby
ordains as follows:
WHEREAS, Ordinance No. 792 adopted by the City Council of
the City of Tustin on February 5, 1979, granted a non-exclusive
cable television franchise ("Franchise") to Six Star Cablevision of
Tustin, Inc., a California corporation; and
WHEREAS, Ordinance No. 813 adopted by the City Council
of the City of Tustin on November 5, 1979, amended said Franchise;
and
WHEREAS, Resolution No. 81-10 adopted by the City
Council of the City of Tustin on February 2, 1981, approved the
transfer of certain interests in Six Star Cablevision of Tustin,
Inc., a corporation; and
WHEREAS, the Six Star Cablevision of Tustin, Inc. has
requested that the City of Tustin approve the changes in ownership
set forth below:
a. The acquisition by communiCom of all the interests
of the limited partners of Six Star Cablevision
Associates, Ltd., a New Jersey limited partnership, in
six Star Nielson Cablevision, a California general
partnership.
b. The dissolution of Six Star Nielson Cablevision, a
California general partnership.
c. The transfer of all of the shares of Six Star
Cablevision of T.ustin, Inc., a corporation, to
CommuniCom, a California corporation.
d. The change of name of Six Star Cablevision of
Tustin, Inc., a California corporation, to "CommuniCom
of Tustin", a California corporation.
e. The net result and effect of the aforesaid changes
to be that the Franchisee would be communiCom of Tus-
tin, a California corporation, all of the shares of
which will be solely owned by CommuniCom, a California
corporation, all of the shares of which will be solely
owned by Nielson Enterprises Inc., a Delaware corpora-
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tion; and
WHEREAS, communiCom, a California corporation, has entered
or will enter into, an Agreement of Purchase and Sale with United
Cable of Southern California, Ltd., a limited partnership formed
under the laws of the State of Colorado, of which UCTC of Southern
California, Inc., a Delaware corporation, is the General partner
and pursuant to such Agreement United Cable of Southern california,
Ltd. will acquire all the stock, properties and assets of Communi-
Com, including the Franchise; and
WHEREAS, CommuniCom has requested approval by the City of
Tustin to the transfer of ownership of the Franchise to United
Cable of Southern California, Ltd.; and
WHEREAS, representatives of the City of Tustin and
communiCom and United Cable of Southern california, Ltd. have
conferred and have concluded that it would be in the mutual best
interests of the City of Tustin and Franchisee to amend the Fran-
chise as hereinafter provided; and
WHEREAS, the City of Tustin is willing to approve the tran-
sfer of ownership of the Franchise to communiCom and if the stock,
properties and assets of CommuniCom are acquired by united Cable of
Southern California, Ltd., the transfer of the Franchise to United
Cable of Southern California, Ltd. in accordance with the terms of
this amended Franchise.
1. Authority for Franchise. This amendment to the non-
exclusive franchise for a cable television system is enacted
pursuant to the authority provided in, and all of the provisions,
terms and conditions, of Article 7, Chapter 4 of the Tustin City
Code, Sections 7410 et seq.
2. Grant of Franchise. Pursuant to the provisions of
Article 7, Chapter 4 of the Tustin City Code the City Council of
the City of Tustin hereby approves the transfer of the non-
exclusive Franchise to construct, operate and maintain a cable
television system within those portions of the incorporated limits
of the City of Tustin in which there is no exclusive Franchise in
effect, to communiCom of Tustin, a California corporation, and upon
United Cable of Southern California Ltd's acquisition of its
stock, properties and assets, and upon compliance with the
provisions of Section 32 of this Ordinance, the transfer to United
Cable of Southern California, Ltd., a Colorado limited partnership,
with all the rights and privileges and subject to all of the terms
and conditions of (a) said Article 7, Chapter 4, and (b) to the
I extent consistent with the terms a.nd conditions of this Ordinance,
25' Franchisee's predecessor's application, dated November 3, 1978, and
i all supplements and amendments thereto accepted and approved by the
261i City of Tustin, and (c) the terms and conditions provided herein.
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Each, every and all of the conditions, requirements,
limitations and obligations upon Franchisee as set forth in the
Tustin City Code are hereby made a part of the Franchise granted
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herein.
3. Term of Franchise. The term of this Franchise shall be
for a period of twelve (12) years, commencing on the effective date
of this ordinance as provided in Section 31 hereof, subject to
termination of the Franchise granted by this ordinance as
hereinafter provided.
4. Assignment or Transfer of Franchise. The Franchise
granted herein shall be a privilege to be held in personal trust by
CommuniCom of Tustin, or subject to Section 32 hereof by United
Cable of Southern California, Ltd., a Colorado limited partnership
of which UCTC of Southern California, Inc. is the General Partner.
It cannot in any event be sold, transferred, leased, assigned or
disposed of in whole or in part, either by forced or involuntary
sale, or by voluntary sale, merger, consolidation or otherwise,
without prior consent of the City Council of the City of Tustin
expressed by resolution, and then only under such conditions as may
therein be prescribed. Any such transfer or assignment shall be
made only by an instrument in writing, such as a bill of sale, or
similar document, 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. Any proposed assignee must show responsi-
bility and capability as determined by the City Council and must
agree to comply with all provisions of the Franchise and Tustin
City Code, and, provided further, that no such consent shall be
required for transfer in trust, mortgage or other.hypothecation, in
whole or in part, to secure an indebtedness. Such consent shall
not be withheld unreasonably.
Further, inasmuch as when the aforedescribed acquisition
occurs the Franchisee is a limited partnership whose general
partner is UCTC of Southern California, Inc., a Delaware
corporation prior approval of the City Council, expressed by reso-
lution, shall be required where there is an actual change in
control or where ownership of more than ten percent (10%) of the
voting stock of the general partner is acquired by a person or
group of persons acting in concert, none of whom already own fifty
percent (50%) or more of the voting stock, singly or collectively.
Any such acquisition occurring without prior approval of the City
Council shall constitute a failure to comply with the provisions of
this Franchise. Nothing herein shall restrict the transferability
of the interests of limited partners in United Cable of Southern
California, Ltd.
5. Rates. Pursuant to Article 7, Chapter 4 the
following schedule of rates and charges is hereby approved:
A. INSTALLATION CHARGES
1. Definition - Standard Installation
A standard installation shall include
installations of aerial drop cable with
fittings up to 150 feet from the cable
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television distribution system directly to
the customer's television set.
2e
A. Overhead
(1) 1 to 150 feet -
(2) Over 150 feet -
$15.00
$15.00 + $1.00
per foot over
150 feet
Be
Underground - A WRITTEN ESTIMATE
FORM MUST BE PROVIDED SUBSCRIBER
(1) All
$15.00 + $2.00
per linear foot
of underground
(2)
If subscriber
provides trench,
repaving, back-
filling and
planting
$15.00 up to
150 feet,
$1.75 per
linear foot
of under-
ground in
excess of 150
feet
3. Additional Outlets and Channel Selectors
A. Additional outlets or channel
selectors - $15.00
B. If separate structures are
involved, 2.A or 2.B applies
4. Installation of House Amplifier
A. If ordered and installed separately
- $15.00
B. If installed at time of first
outlet or any other work is performed on the
premises for which a charge is authorized -
$7.5o
5. Relocation Charge
The charge shall be $15.00 for each
relocated outlet or relocated channel
selector. The charge shall be $7.50 if
relocation is done with other work.
6. Reconnect Charge - $10.00
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Bo
The $10.00 charge shall apply only when
-the Franchisee has previously served the
premises and facilities are in place but
service was disconnected, or in the case of
apartments, condominiums or townhouses when
service is in place and an individual unit is
connected to the system non-concurrently with
the installation of the system in the
building. This charge also applies to hookup
of individual units on bulk rate of
agreement.
7. Apartments, Hotels, Motels,
Condominiums, Townhouses and Non-Residences
A. Actual estimated cost with written
agreement.
e
Schools and City-Owned Facilities
As provided in Chapter 25 of the Tustin City Code.
9. Subscriber Liability for Loss or Damage
to Equipment or Facilities
A. Subscribers will be charged for the
loss or damage of any equipment furnished by
Franchisee.
B. Franchisee may collect and hold
without the payment of interest a $25.00
deposit as security for each channel
selector.
SERVICE CHARGES:
The charges in this subsection are for
service on all carried UHF and VHF channels
including local origination.
1. Monthly Rate - Residence
A. First Outlet $7.50
B. Additional Outlet $1.50 each
C. Channel Selectors $1.50 each
In-house Amplifiers $4.50 each
(five or more outlets)
2. Apartment Units, Hotels, Motels,
Condominiums, Townhouses and Non-Residences
on One Billing for All Units Monthly Rate
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Reduced rates would be negotiated with
individual Owners or Leaseholders in
proportion to the number of units involved.
Fees for additional and/or special services shall be as
approved from time to time by resolution of the City Council.
Franchisee may charge it's subscribers and users less, but not more
than the rates and charges in accordance with the foregoing sched-
ule.
Franchisee may increase such rates and charges as herein-
after provided. Not more often than two times during any calendar
year, Franchisee shall notify the City of Tustin, in writing, of a
proposed increase in such rates and charges. The increase shall be
effective sixty (60) days after the City of Tustin has received
written notice of such increase, unless prior to such date the city
council of the City of Tustin shall by resolution set the matter
for hearing at a meeting of the city council. If a hearing is set,
the City Council shall act to approve, modify or disapprove such
increase within sixty (60) days after the matter is set for hear-
ing. At such hearing, the Franchisee may present evidence with
respect to the proposed increase in rates and charges. If the city
council adopts a resolution setting the proposed increase in rates
and charges for hearing, no rate, charge, service, contract, prac-
tice or rule shall be changed so as to result in an increase in
such rates and charges until said hearing is held and the city
council of the City of Tustin has approved such increase in the
rates and charges.
6. Definition of Gross Revenues. "Gross Revenues" shall
mean all cash, credits, property of any kind or nature or other
consideration derived directly or indirectly by the Franchisee, its
affiliates, subsidiaries, and any other_person or entity in which
Franchisee has a financial interest or which has a financial
interest in the Franchisee, arising from or attributable to
operation of the cable television system in the City of Tustin, as
its corporate city limits now and/or hereafter may be constituted,
including, but not limited to:
a. Revenue from the subscriber network and insti-
tutional network (including Leased Access fees).
b. Advertising revenues.
c. Revenue from the use of studio facilities,
production equipment and personnel.
d. Revenue from installation, connection and
reinstatement and the provision of subscriber and other
services.
e. The sale, exchange or cablecast of any programming
developed for Community Use or institutional users.
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f. Interconnection revenues.
"Gross Revenues" shall include, valued at retail price
levels, the value of any goods, services or other remuneration in
non-monetary form received by the Franchisee or others described
above in consideration for performance by the Franchisee or others
described above of any advertising or other service in connection
with the cable television system.
"Gross Revenues" shall not include:
a. Any taxes on services furnished by the Franchisee
which are imposed directly upon any subscriber or user
by the United States, State of California or local -
agency and collected by the Franchisee on behalf of the
government.
b. Revenue received directly from the Franchisee by an
affiliate, subsidiary or parent of the Franchisee or
any other person or entity in which the Franchisee has
a financial interest or which has a financial interest
in the Franchisee, when the revenue received has
already been included and reported Gross Revenue as
received by the Franchisee.
7. Franchise Fees. For the use of the City streets and
for the purposes of providing revenue with which to defray the cost
of regulation arising out of issuance of the Franchise and promot-
ing, assisting and financing Community Use Programming and other
cable services of a public character, Franchisee shall pay fran-
chise fees in the amounts prescribed below. The parties shall
cooperate with each other in filing with the Federal Communications
Commission and fully supporting an application permitting payment
of the amounts prescribed below. The City shall file such applica-
tion, at the Franchisee's sole cost and expense, with the Federal
Communications Commission as soon as practical after Franchisee
accepts this Franchise. Such application need not be filed or will
be withdrawn if federal legislation is enacted which permits the
City to charge a franchise fee of five percent (5%) of Gross Reve-
nues without oubtaining Federal Communications Commission approval.
The franchise fee shall be paid as hereinafter set forth provided,
however, that until federal legislation is adopted or approval of
the Federal Communications Commission is received permitting pay-
ment of the franchise fees provided for herein the Franchisee shall
pay the City of Tustin an amount equal to three percent (3%) of
Gross Revenues. The parties will seek approval in said application
to pay five percent (5%) of Gross Revenues as of the date of its
acceptance of the Franchise and to pay interest on an amount equal
to two percent (2%) of Gross Revenues from the date of acceptance
to the date of said approval. Interest shall be paid at a rate
equal to the prime rate established by the Bank of America National
Trust and Savings Association.
The streets and other public rights-of-way to be used by
Franchisee in the operation of its system within the boundaries of
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the City of Tustin are valuable public properties acquired and
maintained by the City at great expense to its taxpayers, and the
grant to the Franchisee of consent to use such streets and other
public rights-of-way is a valuable property right without which the
Franchisee would be required to invest substantial additional
capital. Furthermore, the City will incur costs in administering
the Franchise in the public interest. Thus, in consideration of
the granting and exercise of a Franchise to use the streets and
other public rights-of-way as herein defined, for the operation of
a cable television system, and to reimburse City for costs incurred
in administering this Franchise granted pursuant to this ordinance,
the Franchisee shall pay the City the fees provided in this ordi-
nance.
Except as provided otherwise in this Section, during the
term of the Franchise, the Franchisee shall pay to City of Tustin
an amount equal to five percent (5%) per year of the Franchisee's
annual Gross Revenues.
Said fees shall be paid quarterly not later than June 1,
September 1,~ December 1 and March 1 for the preceding three (3)
month period ending, respectively, March 31, June 30, September 30
and December 31. Not later than March 1, the Franchisee shall file
with the City Clerk of the City of Tustin an annual audit report by
a Certified Public Accountant approved by City, of the operations
of Franchisee which identifies in detail the sources and amounts of
all Gross Revenues received by the Franchisee from all sources,
both inside and outside City. On the date of payment other than
March 1, Franchisee shall file an unaudited report which identifies
all Gross Revenues during the period for which payment is made.
It is the intent of the City of Tustin to utilize substan-
tial amounts or all of the franchise fees imposed hereunder to defra
the cost of local administration of the Franchise, to support the
development and maximum utilization of all community service and
government access channels and to generally encourage development
and use of the cable system to full utilization of its potential.
No acceptance of any payment shall be construed as an accord
that the amount paid is, in fact, the correct amount, nor shall
such acceptance of payment be construed as a release of any claim
which the City of Tustin may have for further additional sums
payable under the provisions of the Franchise.
8. Reimbursement of City Expenses. The Franchisee shall
pay to the City of Tustin an amount equal to the legal expenses
incurred by the City in preparing, revising, negotiating and
enacting this ordinance and matters directly related thereto. The
City shall prepare a statement aggregating such cost and send such
statement to the Franchisee. The Franchisee shall pay the amount
of such statement to the City on the earlier of thirty (30) days
after the closing date or July 31, 1984.
The purpose of this Section is to reimburse City for the
expenses incurred by the City of Tustin in .preparing and enacting
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this ordinance.
9. Future Laws. The City of Tustin does not have or
expect in the forseeable future to receive sufficient funds with
which to defray the costs of administering and regulating the cable
television franchise within the City. ~he ability %o finance' such
costs through franchise fees pursuant to the provisions of Section
7 above, constitutes a material inducement to initiate a cable
television program within the City of Tustin because the City of
Tustin would not be willing to reduce or eliminate other public
programs in order to make public funds available with which to
defray the cost of administering and regulating the cable
television program.
Therefore, should any future law or regulation limit or
prevent the City of Tustin from imposing a franchise fee in the
amount provided for herein, the Franchisee shall nevertheless pay
the City of Tustin the same amounts at the same times as are
prescribed by Section 7 above. The Franchisee shall make a good
faith effort to obtain any possible waiver or permission to pay the
full amounts provided for herein, and to the extent such future law
or regulation permits the Franchisee discretion to make the limita-
tion or prohibition applicable or inapplicable, the Franchisee
shall elect to make the limitation or prohibition inapplicable.
The City of Tustin may, in addition to any other remedies available
to it, treat any reduction of payments as a failure of considera-
tion for the Franchise awarded pursuant to this ordinance and may
terminate the Franchise. If, as a result of any acts of the
Federal communications Commission, the United States Congress or
any other entity lawfully asserting jurisdiction for the regulation
of cable communication systems, any provision or provisions of this
Franchise as modified, amended, revoked, redeemed, or changed to
result in what constitutes, in the view of the City of Tustin,
material changes in the provisions and circumstances of the Fran-
chise so granted, the City may elect to (a) amend the Franchise and
all such parts related to such material change, or if said amend-
ment is not acceptable to the Franchisee, (b) treat such material
change as a cause for revocation of the Franchise.
The failure of the City of Tustin to receive the fees
prescribed hereinabove shall be deemed to constitute a substantial
and material failure to comply with the Franchise.
10. Limitation of Uses. The cable television system herein
franchised shall be used exclusively for the purposes expressly
authorized by Article 7, Chapter 4 of the Tustin City Code and no
other purpose whatsoever.
11. Establishment and Extension of Service:
a. Upon the effective date of this ordinance,
Franchisee shall diligently proceed or continue to
proceed to obtain all necessary permits and
authorizations necessary to construct and operate cable
television service and shall forthwith proceed or
Franchisee shall diligently proceed or continue to
1 proceed to obtain all necessary permits and
authorization~ necessary to~ construct and operate cable
2 television service and shall forthwith proceed or
continue to proceed with construction and installation
3 of the cable television system as specified and
described in this ordinance and Article VII, Chapter 4
4 of the Tustin city code and approved by City of Tustin
and shall diligently and without delay carry all con-
5 struction to full completion.
6 b. Service will commence within 60 days of the effec-
tive date of this ordinance.
7 12. Acceptance of Franchise. Within thirty (30) days after
8 the effective date of this ordinance, Franchisee shall file with
the City of Tustin its written, unconditional, non-contingent ac-
9 ceptance of the Franchise granted by this ordinance and its agree-
ment to be bound by and comply with all the requirements he~eof.
10 The Acceptance shall be signed by a person duly authorized to act
on behalf of the Franchisee, shall be notarized and shall have
11 attached thereto a certified copy of an order by the Board of
Directors of communiCom of Tustin, authorizing and directing execu-
12 tion and filing of the Acceptance, provided, however, that such
acceptance is subject to Section 32 hereof. An Acceptance which
13 constitutes a qualified acceptance or places other limits or condi- tions therein shall be deemed to be a nullity, upon the failure of
14 the Franchisee to file its unconditional, non-contingent Acceptance
of the Franchise subject to all its terms and conditions within the
15 time period specified above, the Franchise shall be of no further
force or effect and there will be not issued and outstanding cable
16 television franchise in the City of Tustin to any of the companies
or entities named in this ordinance. Franchisee shall furnish and
17 maintain all bonds and insurance policies required to be furnished
pursuant to Tustin City Code and this Franchise.
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13. Bonds. upon the adoption of this ordinance and the
19 Acceptance of th~ Franchise by Franchisee as hereinabove provided,
and in addition to satisfying all other requirements of the Tustin
20 City Code, Franchisee shall deposit in a bank or savings and loan
association in the City of Tustin the sum of One Hundred Thousand
21 Dollars ($100,000.00) in a joint account in the names of Franchisee
and the City of Tustin, or shall file with the City clerk and
22 maintain in full force and effect a bond, approved by the City
Attorney, in an equivalent amount. The passbook, certificate of
23 deposit or surety bond shall be delivered to and held by the City
of Tustin. The cash deposit sum, or the corporate surety bond
24 shall be maintained during the period of construction of the cable
television system within the City of Tustin as prescribed by this
25 ordinance. Upon full and final completion of the cable television
system as prescribed in this ordinance within the times prescribed
26 in the Franchise, City shall deliver the said passbook, certificate
of deposit or surety bond to Franchisee and execute any appropriate
27 document releasing City's interest and rights therein to
Franchisee. This release shall be contingent upon the full and
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faithful performance of the Franchisee of its obligations under
this ordinance. In the event that Franchisee shall fail to comply
with any one or more of the provisions of the Franchise there shall_
be recoverable from the aforesaid sum or bond any and all damages
or loss suffered by City as a result thereof, including but not
limited to the full amount of any compensation, indemnification,
cost of removal of abandoned property, staff costs in attempting to
secure compliance, plus a reasonable allowance for attorneys' fees
and costs, up to the full amount of the aforesaid deposit. Relin-
quishment of City's interests and rights in the aforesaid deposit
shall also be conditioned upon the deposit with City of a perform-
ance bond as provided in the following paragraph.
Prior to relinquishment by City of any of its interests and
rights in the deposit described in the preceding paragraph,
Franchisee shall file with the City Clerk and shall thereafter,
annually, during the entire term of the Franchise, maintain in full
force and effect a corporate surety bond or other adequate surety
agreement approved by the City Attorney in the amount of Fifty
Thousand Dollars ($50,000.00). The bond or agreement shall be so
conditioned that in the event the Franchisee shall fail to comply
with any one or more of the provisions, of the Tustin City Code or
of the Franchise granted to Franchisee, then there shall be
recoverable jointly and severally from the principal and surety,
any damages or loss, or costs suffered or incurred by the City as a
result thereof, including attorneys' fees and costs of any action
or proceeding, and including the full amount of any compensation,
indemnification, costs of removal or abandonment of any property or
other costs which may be in default, up to the full principal
amount of such bond. Said condition shall be a continuing
obligation during the entire term of the Franchise and thereafter
until Franchisee shall have satisfied in full any and all
obligations to City which shall arise out of or pertain to said
Franchise.
14. Community Use.
A. The Franchisee shall provide Community Use Chan-
nels and Community Use Programming in order to permit the community
to design, produce and present programming of local interest and
promote the educational, recreational and character-building oppor-
tunities of the viewing public, community Use, community Use
Programming and Community Use Channels shall include use, pro-
gramming and channels for purposes of Non-commercial cablecast
presented by or on behalf of the Franchisee, the City of Tustin,
individuals and local community non-profit organizations, which
consist of topics of special interest to the Tustin community or
elements thereof, including matters of a political, governmental,
social, religious, educational, cultural, artistic, health-
oriented, ethnic, economic, recreational, charitable and philan-
thropic nature, significant part of such programming having been
locally produced. "Non-commercial" means:
(1) That the content of such programming shall not be
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(2) That the programming shall not be associated with
or interrupted during presentation by commercial
advertising or announcements presented for the purpose
of selling products or services for private gain.
B. To meet its obligations under this Section 14, the
Franchisee's obligations shall include the following:
Franchisee shall initially provide one channel for
municipal, educational, and public access purposes to
be utilized on a time-shared basis by the City and the
other entities or individuals served by the cable
television system operated by the Franchisee until such
time as such one channel is used full time during
normal morning, afternoon, and evening viewing hours,
at which time the Franchisee shall provide a second
such channel to be utilized on the same basis, and when
that channel is also used full time, the Franchisee
shall provide a third such channel to be utilized on
the same basis, which three channels shall be the total
maximum number of channels which the Franchisee shall
be required to provide for such municipal, educational,
and public access purposes. In order that the City and
others may utilize the educational and municipal chan-
nels, the Franchisee will provide video and such other
equipment and personnel as is necessary to broadcast on
said channels, at Franchisee's cost.
15. Level of Service and Local Origination. It is the
intent of the City that the Franchisee shall provide as soon as it
is financially feasible a cable television system which at all
times during the Franchise period is equal to the then current
state of the art.
Franchisee shall provide local-origination programming as
soon as it is financially feasible to do so as determined by the
City Council in the reasonable exercise of its discretion.
16. Bi-Directional Interconnect Capability. The system to
be installed by Franchisee shall have bi-directional interconnect
capabilities and shall be interconnected when technically and
financially feasible to do so as determined by the City Council in
the reasonable exercise of its discretion.
In all events, at such time as the Franchisee achieves
a penetration rate of forty percent (40%), the Franchisee, at its
24.. expense, shall open a studio in the City for video origination, I~ which may be located in the same location as the Franchisee's
local business office. The Franchisee shall keep open such studio
251~ thereafter for the remaining term of this Franchise. Franchisee
26ii shall furnish the studio, at its expense, with such equipment as ii. the Franchisee determines, but at a minimum one color camera, a
271 video recorder, adequate lighting and playback equipment. The
~ Franchisee shall provide such reasonable staff and technical ser-
28I vices as may be necessary for the studio, which shall be available
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for programming for the public access, educational access, and
government access channel(s).
The Franchisee shall have a business and service
office in the City to serve the Tustin cable television system.
The Franchisee shall also open a billing collection office in the
City which may be at the same location. The Franchisee will
maintain sufficient service personnel and equipment in such
location(s) for the Franchisee to be able to take action upon
customer service calls in the manner specified herein. The local
office, including the service office, shall be open to receive
inquiries or complaints for subscribers during normal business
hours and in no case less than 9:00 a.m. to 5:00 p.m. Monday to
Friday, excluding legal holidays; provided, however, that such
hours may be lessened upon the prior written consent of the City
Manager provided that local, non-toll telephone service is
available during such times.
The Franchisee shall maintain a service repair force
sufficient to respond within a reasonable time to any individual
interruption of service and also a sufficient installation force to
minimize delay for service in. stallation. Any service complaint
from subscribers will be invesstigated and acted upon as soon as
possible.
The Franchisee shall provide a telephone answering
system to receive all construction and service compla%nts. The
telephone number of the local office shall be listed in the
telephone directories serving Tustin. The telephone service shall
be operable to accept complaints twenty-four (24) hours a day,
seven (7) days a week.
The Franchisee shall keep a maintenance service log a
running three year period which will indicate the nature of each
service complaint, its location, the date and time it was received,
the disposition of said complaint and the time and date thereof.
This log shall be made available for periodic inspection by the
City.
17. Number of Channels. The cable television system
installed pursuant to the Franchise granted herein shall consist of
a one (1) cable subscriber network with a capacity of not less
than fifty-two (52) channels. As soon as it is financially
feasible as determined by the City Council in the reasonable exer-
cise of its discretion, the Franchisee shall add an institutional
network.
18. Remedies. At the time of issuance of this Franchise,
it is impractical to reasonably ascertain the total extent of
damages which may be incurred as a result of the breach by
Franchisee of its obligations under the Franchise. The factors
relating to the impracticality of ascertaining damages include, but
are not limited to, the following:
a. The fact that: (i) the primary damage resulting
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from breaches by the Franchisee of the schedules for
construction of extension of the cable television
system and provision for services will be to members of
the public who are denied services or denied quality or
reliable service; (ii) such breaches cause
inconvenience, anxiety, frustration and deprivation of
the benefits of the Franchise to individual members 0f
the general public in subjective ways and in varying
degrees of intensity which are incapable of measurement
in precise monetary terms; (iii) that services might be
available through the cable television system which are
both necessary and available at substantially lower
costs than alternative services, and the monetary loss
resulting from denial of services or denial of quality
or reliable services is impossible to calculate in
precise monetary terms, and (iv) the termination of a
Franchise for such breaches, and other remedies are, at
best, means a future correction and not remedies which
make the public whole for past breaches;
b. The fact that the failure of the Franchisee to make.
timely reports will make it difficult in ways which are
not measurable for the City of Tustin to administer the
construction schedule, delay initiation of enforcement
proceedings and impede compliance with the periods
allowed for construction; and
c. The fact of the failure of the Franchisee to file
timely annual reports will deny information necessary
to enable the City of Tustin to expeditiously,
effectively and efficiently administer the Franchise
and exercise its regulatory powers in relation thereto
for the promotion and protection of the public
convenience, health, safety, and welfare.
Without the provisions of this Section, the actual damages for
which the Franchisee would be liable, could greatly exceed the
specified amount of liquidated damages. Therefore, the provisions
herein for liquidated damages are of benefit to the Franchisee.
19. Liquidated Damages. If the City believes that the
Franchisee is in material default under the terms of the Franchise,
the City shall give written notice of such default to the
Franchisee. The Franchisee shall have fourteen (14) days from
receipt of such notice to cure the default or to agree in writing
with the City upon a method and time that such default shall be
24,, cured. If the default is not cured, the City Council of the City
!~ of Tustin may assess the Franchisee and the Franchisee shall be
25~i liable for liquidated damages in the sum of Five Hundred Dollars
~ ($500.00) for each calendar day on which the Franchisee is in such
26!~ default. Said liquidated damage sum shall be severally applicable
to each calendar day of delay in compliance with the provisions of
271 construction and separately applicable for each calendar day of . delay complying with any other provision of the Franchise.
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20. Completion of Construction. The cable television
system constructed pursuant to this ordinance shall be fully and
completely constructed no later than June 30, 1984 or such later
date as the City Council may by resolution approve.
21. Alternative Remedies. Neither a termination
of the Franchise nor liquidated damages shall be deemed to be the
exclusive remedy for breach of the Franchise. Neither the right to
assess liquidated damages nor the assessment of liquidated damages
nor the right to reduce or reduction of the term of the Franchise
shall be deemed to bar or otherwise limit the right of the City of
Tustin to obtain judicial enforcement of the Franchisee's
obligations by means of specific performance, injunctive relief,
mandate or other remedies at law or in equity, other than monetary
damages.
22. Termination of Franchise. The following material
breaches of the obligations of the Franchisee under the Franchise
shall constitute grounds for termination of the Franchise by the
City Council of the City of Tustin:
a. The willful failure to make any payments required
under the Franchise and/or to provide City with
required information in a timely manner as provided in
the Franchise.
b. Any other act or omission by the Franchisee which
materially violates the terms, conditions or
requirements of the Franchise or any order, directive,
rule or regulation issued thereunder'and which is not
corrected or remedied within thirty (30) calendar days
following mailing to the Franchise written notice of
the violation or within such period beyond the thirty
(30) calendar days as is reasonable.
23. ~ Right to Operate S_~stem. In the event the
Franchisee fails to operate its cable t-~vision system for seven
(7) consecutive days without prior approval by the City Council of
the City of Tustin and for reasons which are not beyond the
Franchisee's control, the Council through its officers, agents,
employees or contractors may, at its option, enter upon the
premises of the Franchisee, occupy such premises and property
constituting the cable television system, and operate the system
until such time as the Franchisee presents proof satisfactory to the
City Council that it is ready, willing and able to renew operation
of the system. In operating the system, the City or its contractor
shall be vested with the powers of a receiver, and shall be
authorized to contract in the name of the Franchisee, incur
expenses in the name of the Franchisee, and take any and all other
actions necessary to enable it to effectuate the purposes of this
Section. The costs incurred by the City in undertaking such
operation shall be a charge against the assets of the Franchisee,
and the City or its contractor shall be authorized to reimburse
itself for the costs incurred from revenues received during the
period of operation.
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24. NO Recourse Against City. Franchisee shall have no
recourse whatsoever against the City of Tustin or its officers,
agents, or employees for any loss, costs, expense or damage arising
out of or resulting from any provision or requirement of the
Franchise or any rule, regulation, requirement or directive
promulgated thereunder, or because of the enforcement of any
provision of the Franchise or any rule, regulation, requirement or
directive promulgated thereunder, or in the event any provision of
the Franchise or any rule, regulation, requirement or directive
promulgated thereunder is determined to be invalid.
25. Non-Enforcement. The Franchisee shall not be relieved
of any obligation to comply with any of the provisions of the
Franchise or any rule, regulation, requirement or directive
promulgated thereunder by reason of any failure of the City of
Tustin or its officers, agents or employees to enforce prompt
compliance.
26. Franchise as Contract. The Franchise shall be deemed
to constitute a contract between the Franchisee and the City of
Tustin. The Franchisee shall be deemed to have contractually
committed itself to comply with the terms, conditions and pro-
visions of the Franchise, and with all rules, orders, regulations
and determinations applicable to the Franchise which are issued,
promulgated or made pursuant to the provisions of this Franchise.
The Franchise shall not be construed to constitute a contra~t of
adhesion.
Ail terms, conditions and provisions of the contract shall
be deemed to be embodied in the Franchise, and conflicts in terms,
conditions or provisions of the Franchise shall be resolved as
follows:
a. The express terms of this Franchise shall prevail
over conflicting or inconsistent provisions in Article
7 Chapter 4 of the Tustin City Code;
b. The express terms of this Franchise shall prevail
over conflicting or inconsistent provisions in either
the application for the Franchise or the certificate of
acceptance of the Franchise.
27. Utility Poles. This Franchise shall not be deemed to
expressly or impliedly authorize the Franchisee to utilize poles
owned by the Southern California Edison Company, Pacific Bell
or any other public or private utility which are located
within the streets, without the express consent of such utility.
28. Changes in Law. Should the State of California or any
agency thereof, the United States or any Federal agency, or any
State or Federal Court require either the City of Tustin or the
Franchisee to act in a manner which is inconsistent with any
provisions of the Franchise, the City Council of the City of Tustin
shall be authorized to determine whether a material provision of
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the Franchise is affected in relation to the rights and benefits
conferred by the Franchise upon the City Council of the City of
Tustin or the public. Upon such determination, the Franchise shall
be subject to reasonable modification or amendment to such extent
as may be necessary to carry out the full intent and purposes
thereof in relation to the rights and benefits of the City Council,
the City of Tustin or the public. The City Council of the City of
Tustin may terminate the Franchise issued pursuant to the
provisions of this Franchise if it determines that substantial and
material compliance with the Franchise in relation to the rights or
benefits of the City Council, the City or the public has been
frustrated by such a State, Federal or judicial requirement and
cannot be corrected by modification or amendment. In the event of
termination of the Franchise pursuant to this section, the City of
Tustin will purchase the cable television system from Franchisee at
fair market value The purchase price will be paid to Franchisee pursu
to an agreement between the City an~ ~he Franchisee which provides fo
the purchase price to be paid from/~enues of the cable television
system over a period of years provided for in said agreement or such
other method of payment legally permissible and fiscally sound.
29. Indemnification; Liability Insurance. Franchisee
agrees to and shall hold City and its officers, employees, agents
and representatives free, harmless and shall indemnify and defend
them against and from any and all claims, demands, costs, liability
to other kind or nature whatsoever arising out of or from the
Franchise, any extension of any time limits contained in the
Franchise, the failure to extend any time limit in the Franchise,
out of the construction, operating, maintenance, program content,
royalties or removal or abandoned of the CATV System by Franchisee.
Franchisee shall procure and thereafter during the life of
the Franchise shall maintain in full force and effect at
Franchisee's sole cost and expense, general comprehensive liability
insurance in an amount not less than One Million Dollars
($1,000,000.00) for injuries, including accidental death, to two
(2) or more persons and in an amount not less than Five Hundred
Thousand Dollars ($500,000.00) for injuries, including accidental
death to any person, and property damage liability insurance in an
amount not less than Five Hundred Thousand Dollars ($500,000.00)
resulting from any one occurrence, and City shall be named as an
additional named insured in said insurance policy, with coverages
to be included in the public liability and property damage policies
of broad form contractual and broad form property damage with the
further provision that said policies shall contain a provision that
written notice of cancellation or material alteration of said
policies shall be delivered to City sixty (60) days in advance of
the effective date of any such cancellation or material alteration.
During the period of construction, and at all times
thereafter, Franchisee shall keep all improvements installed by it
insured against loss or damage by fire, with extended coverage
endorsement or its equivalent in amounts not less than ninety
percent (90%) of the insurable value of the buildings, equipment
and other improvements insured, with loss payable to Franchisee,
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in~u~e~ against? loss 'or damage by fire, with extended coverage
en~o~ement or its equivalent in amounts not less than ninety
p~ent (90%) of the insurable value of the buildings, equipment
~n~ ?thor improvements insured, with loss payable to Franchisee,
~ny lenders of Franchisee which may have a security interest in the
property comprised of the cable television system and City, in
accordance with their respective interests therein.
30. Severabilit~. The provisions of Section 1115 of the
Tustin City Code shall not be applicable to the provisions of the
Franchise.
31. Effective Date of Ordinance. This ordinance shall be-
come effective thirty-~)-~ays after its passage.
32. Permitted Assignment. Subsequent to the effective date
of this ordinance the stock, properties and assets of CommuniCom
may be acquired by United Cable of Southern California, Ltd. The
City of Tustin hereby consents to transfer of the franchise to
United Cable of Southern California, Ltd. provided that the follow-
ing conditions are satisfied. Those conditions are that (i) on or
before June 30, 1984, or such later date as the City Council by
resolution may permit, United Cable of Southern California, Ltd.
notify the City of Tustin, in writing, that United has acquired the
stock, properties and assets of CommuniCom, and (ii) that within
thirty (30) days after the written notification in (i) above that
United, file with the City of Tustin, its written acceptance of the
Franchise in accordance with Section 12. and only upon the
occurrence of those conditions is CommuniCom of Tustin released
from liability under the terms of the Franchise.
PASSED AND ADOPTED at a regular meeting of the City Council
of the City of Tustin, California, held on the day of
, 1984.
ATTEST:
MAYO R
CITY CLERK
JGR:se:R:03/06/84(12b.cj)
JGR:se:R:03/13/84
JGR:se:R:03/14/84
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