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1988-1822463L NOTE Amended by Ordinance No 99-095 ORDINANCE NO V_ff - AN ORDINANCE OF THE CITY COUNCIL AMENDING CHAPTER 5 1/2 (CABLE TELEVISION) THE OF OF THE C, A ORDINANCES PROVIDINGDF FOR THE REPEAL OFT ALLPROVIDING SEVERABILITY OFCLAUSE,CODE IN CONFLICT HEREWITH, PROVIDING FOR A PENALTY NOT TO EXCEED $200 00 DOLLARS, AND DECLARING AN EFFECTIVE DATE THE COUNCIL OF THE CITY OF DENTON HEREBY ORDAINS SECTION I That the Code of Ordinances of the City of Denton s ereby amended b7 the amendment of Chapter 5 1/2, entitled "Cable Television', which shall hereafter read as follows ARTICLE I IN GENERAL Sec 5 1/2-1 Franchise granted and limitations A franchise to be granted by the City of Denton pursuant to this chapter shall grant to the Grantee, the right, privilege and franchise to erect, construct, operate and maintain in, upon, along, across, above, over and under the streets, alleys, public ways and public places now laid out or dedicated and all such extensions thereto and additions thereto in the City, and poles, wires, cables underground, conduits, manholes, and other tele- vision conductors and fixtures necessary for the maintenance and operation of a Cable System for the interception, sale, trans- mission and distribution of television programs and other audio- visual electrical signals and the right to transmit the same to the inhabitants of the City on the terms and conditions herein- after set forth The City of Denton expressly reserves the right to grant a similar use of said streets, alleys, public ways and places to any person at any time during the period of this franchise It is further the intention of this chapter to limit the activity of a Grantee hereunder solely to the operation of cable television systems within the City of Denton Sec 5 1/2-2 Duration of franchise grant The term of any franchise granted by the City of Denton pursuant to this chapter shall be for a period of fifteen (15) years from and after the grant and acceptance date of the franchise to be awarded, subject to the conditions and restrictions as here- inafter provided, and further provided that the mayor and City Council shall have the right to review such franchise periodically at such times as the mayor and City Council may from time to time elect to do so and as hereinafter provided Sec 5 1/2-3 Franchise rights subject to police powers In accepting a franchise, the Grantee acknowledges that its rights thereunder are subject to the police power of the City to adopt and enforce general ordinances necessary to the safety and welfare of the public, and it agrees to comply with all applicable general laws and ordinances enacted by the City pursuant to such power, provided that such additional ordinances shall not substantially or materially conflict with or alter in any manner the rights granted in a franchise and shall not conflict with the laws of the State of Texas, the United States of America or the rules of the Federal Communications Commission Secs 5 1/2-4 5 1/2-9 Reserved ARTICLE II SHORT TITLE AND DEFINITIONS Sec 5 1/2-10 Short Title, Definitions_ This chapter shall be known and may be cited as the "Denton Cable Television Ordinance" of the Code of Ordinances of the City of Denton, Texas, with the following definitions applicable thereto (a) Access channel means a channel dedicated in whole or in part for oca programming which is not originated by a Grantee (b) Cable services means the one-way transmission to sub- scribers o video programming and other programming services together with subscriber interaction, if any, which is required for the selection of such programming and programming services that the cable operator makes available to all subscribers generally Examples of cable services include video programming, pay-per-view, voter preference polls in the context of a video program, teletexts, one-way transmission of any computer software, and one-way videotex services such as news services, stock market information, etc Non-Cable services include shop-at-home, bank-at-home services, electronic mail, one-way and two-way transmission of non-video data and information not offered to all subscribers, data processing, video conferencing and voice communication (c) Cablecastin on ination and access means programming exclusive o roa cast signals Carr a on a cable television system PAGE 2 (1) origination cabllec~ast~in~ Programming (exclusive of broadcast signals carrHeon a cable television system over one or more channels, and subject to the exclusive control of the cable operator (2) Access cablecasting television sys em on iLs public, leased channels Services provided by a cable education, local government, or (a) Public access channel A specially designated non-commercial public access c anne available on a first-come nondiscriminatory basis for which the system shall maintain and have available for public use at least the minimal equipment and facilities necessary for the production of programming for such a channel, (b) Education access channel A specially designated channel for use by oca educational authorities, (c) Local overnment access channel A specially designated channe or oca government uses, (d) Leased access channel Portions of the system's nonbroadcast bandwidth, nc u ng unused portions of the specially designated channels for leased access services (d) Cable S stem shall mean a facility, consisting of a set of close transm ssion paths and associated signal generation, reception, and control equipment that is designed to provide cable service which includes video programming and which is provided to multiple subscribers within a community Such term does not include (1) a facility that serves only to retransmit the television signals of one or more television broadcast stations, (2) a facility that serves only subscribers in one or more multiple unit dwellings under common ownership, control, or management, unless such facility or facilities uses any public right-of-way, (3) a facility of a common carrier which is subject, in whole or in part, to the provisions of Title II of the Communications Act of 1934, except that such facility shall be considered a cable system to the extent such facility is used in the transmission of video programming directly to subscribers, or (4) any facilities of any electric utility used solely for operating its electric utility systems (e) City means the City of Denton, Texas, including the person, department, or agency designated by the City Council to act in matters related to cable systems PAGE 3 (f) Converter means an electronic device, which converts signals to ~uency not susceptible to interference within the television receiver of a subscriber, and by an appropriate channel selector also permits a subscriber to view all signals delivered at designated dial locations (g) District means the area within which the cable operator will provide service (h) Federal Cable Communications Policy Act of 1984 shall refer to 47 U S C 52. et se , as the same may be amended from time to time and may hereafter be called the Cable Act (i) Franchise means the right granted through a contractual agreement etween the City and called a person, partnership or corporation by which the City authorizes such person to erect, construct, reconstruct, operate, dismantle, test, use and maintain a cable system in the City M Grantee means a party, its lawful successors and assigns, to which- a franchise under the authority of this Chapter is granted by the Council (k) Gross Revenues means all cash, credits, property of any kind or nature or other consideration derived directly or indirectly by the Grantee, its affiliates, subsidiaries, parents, and any other person or entity in which the Grantee has a financial interest or which has a financial interest in the Grantee arising from or attributable to operation of the Cable System, including but not limited to (1) revenue from all charges for services provided to subscribers of entertainment and non-entertainment services (including leased access fees), (2) revenue from all charges for the insertion of com- mercial advertisements upon the Cable System, (3) revenue from all charges for the leased use of studios, (4) revenue from all charges for the installation, connection and reinstatement of equipment necessary for the utilization of the Cable System and the provision of subscriber and other services, and (5) the sale of cablecast of any programming developed for community use or institutional users PAGE 4 "Gross Revenues" shall include value at retail price levels, or others remuneration the value of non--monetary form, received by the~Grantee other above in consideration for performance by the Grantee or others described above of any advertising or other service in connection with the Cable System "Gross Revenues" shall not include con- verter deposits, refunds to subscribers by the Grantee, subscriber accounts which are in arrears and are deemed uncollectible by generally accepted accounting practices, or items excluded by the Federal Cable Communications Policy Act of 1984 (1) Programmer means any person, firm, corporation, or entity who or w c produces or otherwise provides program material for transmission by video, audio, digital, or other signals, either live or from recorded tapes, to subscribers, by means of the cable communications system (m) School means any institution of the Denton Independent School str ct, any nonprofit day care center, and any other nonprofit educational institution (n) Service basic and additional (1) Basic Service shall mean any service for which includes the transm ss on of local television broadcast signals, and public, educational, and governmental access channels (2) Additional services means any of the following Such video services as the transm ssion of all leased access channel signals not included in basic subscriber service, as well as the transmission of cablecast video advertising messages and pay television signals (o) Street means the surface any, public street, avenue, driveway, bridge, tunnel, park, other public right-of-ways, and existing within the City of and the space above and below highway, boulevard, concourse, alley, sidewalk, easement, all public grounds, now or hereafter (p) Subscriber means any person, firm, corporation, or other entity who legally receives one or more of the services of a Grantee herein (q) Two-wa communications means the transmission of tele- communicat ons s gna s rom subscriber locations or other points throughout the system back to the system's control center as well as transmission of signals from the control center to subscriber locations PAGE 5 (r) User denotes a person or organization utilizing a system channel - or purposes of production and/or transmission of material, as contrasted with receipt thereof, in a subscriber capacity ARTICLE III PROVISIONS GOVERNING THE LENGTH, RENEWAL AND TRANSFER OF A FRANCHISE Sec. 5 1/2-20 _ Franchise Required, Duration, Exclusivit (a) The City may grant a franchise for the use of the streets within the City for the construction, operation, and maintenance of a cable system No system shall be allowed to occupy or use the streets of the city or be allowed to operate without a franchise Any franchise awarded by an agreement in accordance herewith shall be a nonexclusive franchise (b) The franchise may be granted for a term not to exceed fifteen (15) years, thereafter, after full public hearings, and according to the franchise renewal procedure that follows, the franchise may be renewed for periods of reasonable duration, not to exceed fifteen (15) years, as in the opinion of the city council will serve the public interest Sec 5 1/2-21 Procedure to Consider Franchise Renewal (a) A franchise may be renewed by the City upon application of the Grantee pursuant to the procedure established in this section and in accordance with the then applicable law During the six month period which begins with the 36th month before the expiration of the franchise agreement, the City may on its own initiative, and shall, at the request of the Grantee, commence proceedings which afford the public appropriate notice and participation for the purpose of (1) identifying the future cable-related community needs and interests, and (2) reviewing the performance of the Grantee under the franchise during the then current franchise term (b) Upon completion of a proceeding under Sec 5 1/2-21(a), the Grantee seeking renewal of a franchise may, on its own initiative or at the request of the City, submit a proposal for renewal Any such proposal shall contain such material as the City may require, including proposals for an upgrade of the cable system The City may establish a date by which such proposal shall be submitted PAGE 6 (c) (1) Upon submittal by the Grantee of a proposal to the City for the renewal of the franchise, the City shall provide public notice of such proposal and, during the four month perigqd which begins on the completion of any proceedings under Sec 5 1/2 -21(a), renew the franchise or, issue a preliminary assessment that the franchise should not be renewed and, at the request of the Grantee or on its own initiative, the city manager shall select a hearing officer who shall commence an administrative proceeding, after providing prompt public notice of such ider ceeding, in accordance with Sec 5 1/2-21(c)(2) to consider whether (i) the Grantee has substantially complied with the material terms of the existing franchise and with applicable law, (ii) the quality of the Grantee's service, including signal quality, response to consumer complaints, and billing practices, but without regard to the mix, quality, or level of cable services or other services provided over the system, has been reasonable in light of community needs, (iii) the Grantee has the financial, legal, and technical ability to provide the services, facilities, and equipment as set forth in the Grantee's proposal, and (iv) the Grantee's proposal is reasonable to meet the future cable-related community needs and interests, taking into account the cost of meeting such needs and interests (2) In any such proceeding, the Grantee shall be afforded notice and the Grantee and the City, or its designee, shall be afforded fair opportunity for full participation, including the right to introduce evidence, including evidence related to issues raised in the proceeding under Sec 5 1/2-21(c)(1) to require the production of evidence, and to question witnesses A transcript shall be made of any such proceeding (3) The Administrative Hearing Officer will make the findings of fact required by Sec 5 1/2-21(c)(1) within sixty (60) days of said proceeding and promptly submit these findings to the City Clerk (4) Upon receipt of the findings of fact, the City Council shall issue a written decision granting or denying the PAGE 7 proposal for renewal based upon said findings of fact, and transmit a copy of such decision to the Grantee such decision shall state the reasons thereof (d) Any denial of a proposal for renewal shall be based on one or more adverse findings made with request to the factors described in subparagraphs (i) through (iv) of Sec 5 1/2-21 (c)(1), pursuant to the record of the proceeding The grounds of denial shall not constitute a violation of the provisions of 47 U S C 546, as the same may be amended from time to time (e) If the Grantee's proposal for renewal has been denied by a final decision of the city made pursuant to this section, or has been adversely affected by a failure of the City to act in accordance with the procedural requirements of this section, the Grantee may appeal such final decision or failure pursuant to the provisions of 47 U S C 546(e) and 47 U S C 555 (f) Notwithstanding the provisions of subsections (a) through (e) of this section, the Grantee may submit a proposal for the renewal of the franchise pursuant to this subsection at any time, and the City may, after affording the public adequate notice and opportunity for comment, grant or deny such proposal at any time (including after proceedings pursuant to this section have commenced The provisions of subsections (a) through (e) hereof shall not apply to a decision to grant or deny a proposal under this subsection The denial of a renewal pursuant to this subsection shall not affect action on a renewal proposal that is submitted in accordance with subsections (a) through (e) (g) The Grantee shall pay all costs incurred by the City considering and processing a proposal for renewal as described in subsections (a), (c)(1), (c)(3), and (f) of this section Sec 5 1/2-22 Reevaluation The City and the Grantee may hold scheduled reevaluation sessions commencing in the seventh (7) year subsequent to the Grantee's acceptance of a franchise agreement in accordance with the terms of any franchise agreement Sec 5 1/2-23 Forfeiture and termination (a) The City reserves the right to forfeit and terminate a franchise and all rights and privileges of the Grantee in the event of a material breach of its terms and conditions In interpreting this Chapter, material provisions shall include all labeled as such and all others, which, under all the facts and circumstances indicated, are a significant provision of the PAGE 8 franchise agreement A material breach by Grantee shall include, but shall not be limited to the following (1) Violation of any material provision of the franchise or any material rule, order, regulation or determination of the city made pursuant to the franchise, (2) Attempt to evade any material provision of the franchise or practices any fraud or deceit upon the City or its subscribers or customers, (3) Failure to begin or complete system construction, reconstruction or system extension as provided by the franchise, (4) Failure to provide the types of services promised subject to the recourse that is available under 47 U S C 545, (5) Failure to restore service after ninety-six (96) consecutive hours of interrupted service, except when approval of such interruption is obtained from the City, or (6) Material misrepresentation of fact in the application for or negotiation of the franchise (b) The foregoing shall not constitute a material breach if the violation occurs but is without fault of the Grantee or occurs as a result of circumstances beyond its reasonable control Grantee shall not be excused by mere economic hardship nor by misfeasance, malfeasance or nonfeasance of its shareholders, directors, officers, or employees (c) In the event that the City determines that the Grantee has violated any provisions of the franchise, the city manager may make a written demand that the Grantee comply with any such provision and remedy such violation or violations if the violation by the Grantee continues for a period of thirty (30) days following such written demand, without written proof that the corrective action has been taken or is being actively and expeditiously pursued to the satisfaction of the City, the city manager may place the issue of termination of a franchise before the City Council in a hearing The city manager shall cause to be served upon Grantee, at least twenty (20) days prior to the date of such hearing, a written notice of intent to request such termination and the time and place of the hearing (d) At such hearing, the City Council shall hear and consider the issue and shall hear any person interested therein, and shall determine in its discretion whether or not any violation by the Grantee has occurred PAGE 9 (e) If the City Council shall Grantee was the fault of Grantee trol, the Council may, by resolut of the Grantee shall be forfeited compliance within such reasonable establish determine the violation by the and within its reasonable con- ion, declare that the franchise and terminated unless there is period as the City Council may (f) The issue of forfeiture and termination shall auto- matically be placed upon the agenda for the next regular Council meeting at the expiration of the time set by the Council for compliance The City Council then may terminate a franchise forthwith upon finding that Grantee has failed to achieve compliance or, in its discretion, may further extend the period allowed to achieve compliance (g) Upon conclusion of the hearing, the City Council shall adopt a decision which includes findings of fact and conclusions (h) Nothing herein shall be construed as a waiver of or limitation on any right of the Grantee to seek relief in federal or state court In the event of any determination by the City to revoke or terminate a franchise, to impose a forfeiture of a bond, letter of credit or other security fund or to impose a substantial financial penalty which would have a material adverse effect upon the Grantee, such a determination shall be stayed during the pendency of any judicial review thereof Sec 5 1/2-24 Continuity of Service (a) It shall be the right of all subscribers to continue receiving service 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 gives notice of intent to terminate or fails to renew a franchise, the Grantee shall act so as to ensure that all subscribers receive continuous, uninterrupted service regardless of the circumstances In the event of a change of Grantee, or in the event a new operator acquires the system, the Grantee shall cooperate with the City, new Grantee or operator in maintaining continuity of service to all subscribers During such period, Grantee shall be entitled to the revenues for any period during which it operates the system and shall be entitled to reasonable costs for its services when it no longer operates the system (b) In the event the Grantee fails to operate the system for ninety-six (96) consecutive hours without prior approval of the PAGE 10 City or without just cause, the City may, at its option, operate the system or designate an operator until such time as Grantee restores service under conditions acceptable to the City or a permanent operator is selected If the City is required to fulfill this obligation for the Grantee, the Grantee shall reimburse the city for all reasonable costs or damages in excess of revenues from the system received by the City that are the result of the Grantee's failure to perform Sec 5 1/2-25 Acquisition by City (a) If a renewal of a franchise held by the Grantee is denied and the City acquires ownership of the Cable System or effects a transfer of ownership of System to another person, any such acquisition or transfer shall be at fair market value, determined on the basis of the Cable System valued as a going concern but with no value allocated to the franchise itself If a franchise held by the Grantee is revoked for cause and the City acquires ownership of the Cable System or effects a transfer of ownership of the system to another person, any such acquisition or transfer shall be at an equitable price In the determination of an "equitable price," such matters as the harm to the community resulting from the Grantee's breach of the franchise may be considered The value of a Cable System (fair market value or equitable price) shall be determined by an appraisal committee consisting of three persons to be appointed by a judge of a court of record of the City The Grantee, or its successors or assigns, and the City shall each recommend one appointee to the court, however, the court shall not be bound by such recommendations No payment shall be made by the City to the Grantee by reason of the value of the franchise itself (b) It shall be understood that a condition of each contract entered into by the Grantee with reference to operations under a franchise shall be that each contract shall be subject to the exercise of this authority by the City and that the City may be substituted for the Grantee as a party to any such contract and may succeed, at its direction, to all the privileges and the obligations thereof at its option Upon the termination of a franchise and the rights granted thereunder, whether by expiration or forfeiture, the City Council may direct and require the Grantee as provided in Sec 5 1/2-77 to remove its wires, cables, fixtures and accessories and appurtenances from the streets PAGE 11 Sec 5 1/2-26 Transfers and Assignments (a) A franchise shall not be sold, assigned or transferred, either in whole or in part, or leased, sublet, or mortgaged in any manner, nor shall title thereto, either legal or equitable or any right, interest or property therein, pass to or vest in any person without the prior written consent of the City Such consent shall not be withheld unreasonably No such consent shall be required for a transfer of fran- chise or the system in trust, mortgage, or other hypothecation as a whole or in part to secure an indebtedness The proposed assignee must show technical ability, financial capability, legal qualifications and general character qualifications as determined by the City and must agree to comply with all provisions of the franchise and such conditions as may be prescribed by the City Council and expressed by resolution City shall be deemed to have consented to a proposed transfer or assignment in the event its refusal to consent is not communi- cated in writing to Grantee within one hundred twenty (120) days following receipt of written notice of the proposed transfer or assignment (b) The Grantee shall promptly notify the City of any actual or proposed change in, or transfer of, or acquisition by any other party of, control of the Grantee The word "control" as used herein is not limited to mayor stockholders but includes actual working control in whatever manner exercised Every change, transfer, or acquisition of control of the Grantee shall make the franchise subject to cancellation unless and until the city shall have consented thereto, which consent will not be unreasonably withheld For the purpose of determining whether it shall consent to such change, transfer or acquisition of control, the City may inquire into the qualifications of the prospective controlling party and the Grantee shall assist the City in any such inquiry (c) A rebuttable presumption that a transfer of control has occurred shall arise upon the acquisition or accumulation by any person or group of persons of 10 percent of the voting interest of the Grantee (d) The consent or approval of the City Council to any trans- fer of the franchise shall not constitute a waiver or release of the rights of the City in and to the streets, and any transfer shall by its terms, be expressly subordinate to the terms and conditions of any applicable franchise PAGE 12 (e) In the absence of extraordinary circumstances, the City shall not approve any transfer or assignment of a franchise prior to substantial completion of construction of proposed system or completion of a commitment to reconstruct, rebuild or upgrade an existing system (f) The City Council reserves the right of "first refusal" to purchase a cable system at or above a bona fide offering price being made by a third party when the system is placed on the market for sale The City shall exercise such right within ninety (90) days of notification by Grantee of pending sale, or such right shall be forfeited (g) In no event shall a transfer of ownership or control be approved without any successor in interest accepting in writing the terms and conditions of the franchise agreement as amended (h) The Council reserves the right to review the purchase price of any transfer or assignment of the system and any potential assignee to this franchise expressly agrees and under- stands that any negotiated sale value which Council determines will cause a significant effect on subscriber rates in order to finance the purchase may result in a denial of transfer ARTICLE IV FRANCHISE TERRITORY - EXTENSION OF SERVICE Sec 5 1/2-30 Construction and/or Reconstruction span c e u e (a) Grantee shall submit a construction plan or reconstruction plan which shall be incorporated by reference and made a part of the franchise agreement The plan shall include system design details, equipment, specifications and design performance criteria The plan shall also include a map of the entire fran- chise area and shall clearly delineate the following (1) The areas within the franchise area where the cable system will be initially available to subscribers including a schedule of construction for each year that construction or reconstruction is proposed (2) Areas within the franchise area where the cable system cannot reasonably be extended due to lack of present or planned development or other similar reasons, with the areas and the reasons for not serving them clearly identified on the map PAGE 13 (b) Nothing in this section shall prevent the Grantee from constructing or reconstructing the system earlier than planned However, any delay in the system construction beyond the times specified in the plan report timetable must be submitted to and approved by the City Council (c) Any delay beyond the terms of construction or recon- struction timetable, unless approved by the City Council, will be considered a violation of this Chapter for which the provisions of either Sections 5 1/2-62 or 5 1/2-23 shall apply, as deter- mined by the City Council Sec. 5 1/2-31 Construction or Reconstruction, Extensions (a) Construction or reconstruction in accordance with the plan submitted by a Grantee shall commence as soon after the grant and acceptance of a franchise as is reasonably possible Failure to proceed expeditiously shall be grounds for revocation of a franchise Failure to proceed expeditiously shall be presumed in the event construction or reconstruction is not commenced within eighteen (18) months of the grant and acceptance of a franchise (b) Extension of the Cable System into any areas not specifi- cally addressed in the plan shall nonetheless be required if the terms of any of the following conditions are met (1) Upon request of potential subscribers, a Grantee shall extend the system to any contiguous area not designated for initial service in the plan when there exists a density of 35 homes per street mile for aerial cable or 50 homes per street mile for underground cable Extension shall be at Grantee's cost If underground installation is required by regulation, Grantee must make installation at Grantee's expense Where aerial extension is allowed by regulation but underground installation is requested by benefited subscribers, the cost of undergrounding that exceeds estimated aerial extension cost may be charged to such benefited subscribers (2) In areas not meeting the requirements for mandatory extension of service, a Grantee shall provide, upon the request of five (5) or more potential subscribers desiring service, an estimate of the costs required to extend service to said sub- scribers Grantee shall then extend service upon request of said potential subscribers according to the rate schedule Grantee may require advance payment or assurance of payment satisfactory to Grantee The amount paid by subscribers for early extension shall be nonrefundable, and in the event the area subsequently PAGE 14 reaches the density required for mandatory extension, such payments shall be treated as consideration for early extension (c) Nothing herein shall be construed to prevent a Grantee from serving areas not covered under this section upon agreement with property owners Sec 5 1/2-32 New Development Undergrounding (a) In cases of new construction or property development where utilities are to be placed underground, the property owner shall give Grantee reasonable notice of such construction or development, and of the particular date on which open trenching will be available for Grantee's installation of conduit and/or cable Grantee shall also provide specifications as needed for trenching (b) Costs of trenching and easements required to bring service to the development shall be borne by the property owner, provided that if Grantee fails to install its conduit and/or cable within five (5) working days of the date the trenches are available, as designated in the notice given by the developer or, then should the trenches be closed after the five (5) day period, the cost of new trenching shall be borne by Grantee Except for the notice of the particular date on which trenching will be available to Grantee, any notice provided to Grantee by City of a preliminary plat request shall satisfy the requirement of reasonable notice The preliminary plat shall be made available to the Grantee through the Development Review Committee process Sec 5 1/2-33 Aerial and Underground Drops (a) When requests for connection requiring an aerial drop line in excess of one hundred and fifty (150) feet are made, the Grantee must extend and make available cable television service to such residents at a connection fee not to exceed the actual installation costs incurred by the Grantee for the distance exceeding one hundred and fifty (150) feet (b) All areas required to be underground construction shall require all underground drop installations of not more than 150 feet at the cost of the Grantee Connections in excess of 150 feet shall be at the expense of a subscriber, such expense to equal Grantee's actual cost Sec 5 1/2-34 Annexation Upon the annexation of any new territory by the City of PAGE 15 Denton, the portion of the cable system that may be located or operated within such territory, and the streets, alleys, or public grounds thereof, shall thereafter be subject to all the terms of any franchise as though it were an extension made thereunder ARTICLE V OPERATIONS Sec 5 1/2-40 Access programming facilities The Grantee must provide reasonable equipment to be used by access cablecasters with the aid of a technical and production staff to be provided by the operator Equipment that can store programs for later showing shall be provided In addition, Grantee shall make available a centrally located studio to all access users on a first-come, first-serve basis Any applicant to operate the system will be expected to demonstrate in its application how it plans to make available the equipment, the studio, and production and technical staff Applicants will be given preference in the selection process for plans that will most adequately meet these requirements A full schedule of rates for use of equipment, studio, and technical and production staff must be submitted to and agreed to by City If separate rates are planned for mobile facilities, these must be also included Rate preference may be given to noncommercial users Sec 5 1/2-41 Hub system The cable system design shall incorporate the use of a Hub system with sufficient hubs to insure the quality of reception required by the Federal Communications Commission The Grantee shall be required to maintain the capability for nonvoice return communications Sec 5 1/2-42 Emergency override The Cable System shall include an "emergency alert" capability which will permit the mayor, or the mayor's designated representa- tive, to override, by remote control, the audio and/or video of all channels involved in retransmission of television broadcast programming The cable operator shall designate a channel which will be used for emergency broadcasts Sec 5 1/2-43 Standby power The Cable System operator shall maintain equipment capable of PAGE 16 providing standby powering for headend transportation and trunk amplifiers for a minimum of two (2) hours The equipment shall be constructed so as to automatically notify the cable office when it is in operation and to automatically revert to the standby mode when the AC power returns All utility safety regu- lations must be followed to prevent injury to linemen resulting from a standby generator powering the "dead' utility line Sec 5 1/2-44 Privacy Use of data obtained from subscribers shall be authorized only in accordance with the provisions of 47 U S C 551, as amended Sec. 5 1/2-45 :ch for alt -native use of off-air Grantee shall install an RF switch upon request subscriber ARTICLE VI STANDARDS AND SPECIFICATIONS Sec 5 1/2-50 by a mallation and maintenance of Methods of construction, installation, and maintenance of the Cable System shall comply with the most recent edition of the National Electrical Safety Code, National Electrical Code of 1985, as the same may be amended from time to time, and all applicable laws and regulations to the extent that such codes are consistent with local law affecting the construction, installation, and maintenance of electric supply and communications lines To the extent that such code is inconsistent with other provisions of this franchise or with local law, the latter shall govern Sec 5 1/2-51 System tower - Standards (a) Any tower constructed for use in the Cable System shall comply with the standards contained in Structural Standards for Steel Antenna Towers and Antenna Supporting Structures, EIA Standards RS-222-A as published by the Engineerin Department of the Electronic Industries Association, 2001 EYE (II Street, N W Washington, D C 20006 (b) Installation and physical dimensions of any such tower shall comply with any appropriate Federal Aviation Agency regulations PAGE 17 (c) Any antenna structure used in the Cable System shall comply with Construction Marking, and Lighting of Antenna Structure, 47 C F R 17 1 et sue, and all applicable laws and regulations Sec. 5 1/2-52 Premises, safety All working facilities and conditions used during construc- tion, installation, and maintenance of the City's cable television system shall comply with the standards of the occupational Safety and Health Administration Sec 5 1/2-53 Service Standards (a) A Grantee shall put, keep, and maintain all parts of the system in good condition throughout the entire franchise period (b) Upon termination of service to any subscriber, a Grantee shall promptly remove all its facilities and equipment from the premises of such subscriber upon subscriber's request (c) Grantee shall render efficient service, make repairs promptly, and interrupt service only for good cause and for the shortest time possible Such interruptions, insofar as possible, shall be preceded by notice and shall occur during periods of minimum system use (d) Grantee shall not allow its cable or other operations to interfere with television reception of persons not served by Grantee, nor shall the system interfere with, obstruct or hinder in any manner, the operation of the various utilities serving the residents of the City (e) A Grantee shall continue, through the term of the fran- chise, to maintain the technical, operational, and maintenance standards and quality of service set forth in this Chapter and franchise agreement Should the City find, by resolution, that a Grantee has failed to maintain these standards and quality of service, and should City, by resolution specifically enumerate corrections to be made to come into compliance, a Grantee shall make such corrections Failure to make such corrections within three (3) months of such resolution will constitute a breach of condition for which the remedy set forth in Section 5 1/2-62 is applicable Sec 5 1/2-54 Technical Standards Grantee shall construct, install, operate and maintain its PAGE 18 system in a manner consistent with all laws, ordinances, and construction standards of the City of Denton, the Federal Communications Commission, the NCTA Recommended Practices for Measurements on Cable Television Systems, published by the National Cable Television Association, and detailed standards submitted by Grantee as part of its application, which standards are to be incorporated by reference in the franchise agreement In addition, each Grantee shall provide the City with a written report of the results of the Grantee's annual proof of perfor- mance tests conducted pursuant to FCC standards and requirements Grantee shall pay the costs incurred by the City for any technical assistance deemed necessary by the City for obtaining independent verification of technical compliance with all standards ARTICLE VII LOCAL REGULATORY FRAMEWORK AND REGULATIONS Sec. 5 1/2-60 Remedies to Subscribers (a) In the event that its service to any subscriber is interrupted for twenty-four (24) consecutive hours, except for acts of God, and except in circumstances for which the prior approval of the interruption is obtained from the city council, Grantee shall provide a ten (10) per cent rebate of the monthly fees to affected subscriber (b) In the event that its service to any subscriber is interrupted for forty-eight (48) consecutive hours, except for acts of God, and except in circumstances for which the prior approval of the interruption is obtained from the rebay council, the Grantee shall provide a twenty (20) per cent monthly fees to affected subscribers (c) In the event that its service to any subscriber is inter- rupted for seventy-two (72) or more consecutive hours, except for acts of God, and except in circumstances for which the prior approval of the interruption is obtained from the city council, Grantee shall provide a hundred (100) per cent rebate of the monthly fees to the affected subscribers (d) The time limits prescribed in subsections (1), (2) and (3) shall be measured from the time that the subscriber notifies the Grantee Sec 5 1/2-61 Security Fund (a) Within twenty (20) days after the effective date of a franchise agreement, the Grantee shall deposit with the City's PAGE 19 Executive Director of Finance, and maintain on deposit through the term of any franchise, the sum of Sixty-Five Thousand ($65,000) Dollars in monies, as security for the faithful performance by it of all the provisions of this franchise agreement, and compliance with all orders, permits and directions of any agency of the City having jurisdiction over its acts or defaults under this contract, and the payment by the Grantee of any claims, liens and taxes due the City which arise by reason of the system construction, and the payment reconstruction, by the operation of any maintenance pe penalties for liquidated damages due the City pursuant to this ordinance or a franchise agreement (b) The City Manager may draw upon the security fund in the event of any of the occurrences set forth in this Section and in Section 5 1/2-62 Within ten (10) days after notice to it that any amount has been withdrawn from the security fund deposited pursuant to subdivision (a) of this section in accordance with Section 5 1/2-62 (Liquidated Damages), the Grantee shall pay to or deposit with the Executive Director of Finance a sum of money sufficient to restore such security fund to the original amount of $65,000 Dollars Failure to restore said security fund to the original amount shall constitute a material breach (c) Examples of a basis for drawing upon the security fund include, but are not limited to the following failure of the Grantee to pay to the City any taxes after ten (10) days written notice of delinquency, 2 failure of the Grantee to pay to the City after ten (10) days written notice, any amounts due and owing the City by reason of the indemnity provision of Section 5 1/2-78 of this Chapter, (3) failure by the Grantee to pay to the City, any liquidated damages due and owing to the City pursuant to Section 5 1/2-62 of this Chapter, (4) failure by the Grantee to pay to the City any amounts due pursuant to Section 5 1/2-21(g) of this Chapter, (5) failure by the Grantee to pay, upon ten (10) days written notice, any amounts owing as franchise fees pursuant to Section 5 1/2-69 of this Chapter (d) The security fund deposited pursuant to this Section PAGE 20 shall become the property of the City in the event that this contract is cancelled by reason of the default of the Grantee The Grantee, however, shall be entitled to the return of such security fund, or portion thereof, as remains on deposit with the Executive Director of Finance at the expiration of the term of the franchise agreement, provided that there is then no outstanding default on the part of the Grantee (e) 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 contract 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 Sec 5 1/2-62 Liquidated Damages By acceptance of the franchise granted by the City, the Grantee understands and shall agree that failure to comply with any time and performance requirements as stipulated in this Chapter and the franchise agreement will result in damage to the City, and that it is and will be impracticable to determine the actual amount of such damage in the event of delay or nonperfor- mance therefore the franchise agreement shall include provisions for liquidated damages to be paid by the Grantee, in amounts set forth in the franchise agreement and chargeable to the security fund for the following concerns (a) Failure to complete system construction or reconstruction in accordance with use of streets, erection of poles, undergrounding relocation, Sections 5 1/2-30 and 5 1/2-77 of this Code, unless the City Council specifically approves the delay, by motion or resolution, due to the occurrence of conditions beyond Grantee's control, the Grantee shall pay Five Hundred Dollars ($500 00) per day for each day, or part thereof, the deficiency continues (b) Failure to provide upon written request by the City, data, documents, reports, or other information, the Grantee shall pay Fifty Dollars ($50 00) per day, or part thereof that each violation occurs or continues (c) Failure to test, analyze and report on the performance of the system following a written request by the City pursuant to part City tOne erofar that Dollars this ordinance, e for Grantee each shall day,~a or to ($100 00) per day such noncompliance continues (d) Failure to provide in a continuing manner the types of services proposed in the accepted application, unless the Council specifically approves Grantee a delay or change, or the Grantee PAGE 21 has obtained modification of its obligation under Section 625 of the Cable Act, Grantee shall pay to the City Five Hundred Dollars ($500 00) per day for each day, or part thereof, that each noncompliance continues (e) Upon determining that there has been a failure to make improvements in accordance with Section 5 1/2-53, Grantee shall pay to the City Two Hundred Fifty Dollars ($250 00) for each day, or part thereof, that such noncompliance continues (f) Any other action or non-action by the Grantee, as agreed upon between the City and Grantee, and set forth in the franchise agreement Nothing in this section shall preclude further liquidated damages as agreed upon by the parties in the franchise agreement (g) If the City Manager concludes that the Grantee is liable for liquidated damages pursuant to this Section, he shall issue to Grantee by certified mail a notice of intention to assess liquidated damages The notice shall set forth the basis for the assessment, and shall inform the Grantee that liquidated damages will be assessed from the date of the notice unless the assess- ment notice is appealed for hearing before the City Council and the City Council rules (1) that the violation has been corrected, or (2) that an extension of time or other relief should be granted The Grantee desiring a hearing before the City Council shall send a written notice of appeal by certified mail to the City Manager within 10 days of the date on which the City sent the notice of intention to assess liquidated damages The hearing on the Grantee's appeal shall be within 30 days of the date on which the City sent the notice of intention to assess liquidated damages After the hearing, if the City Council sustains in whole or in part the City Manager's assessment of liquidated damages, the City Manager may at any time thereafter draw upon the Letter of Credit required by Section 5 1/2-61 Unless the City Council indicates to the contrary, said liquidated damages shall be assessed beginning with the date on which the City sent the notice of the intention to assess liquidated damages and continuing thereafter until such time as the violation ceases, as determined by the City Manager (h) Nothing herein shall be construed as a waiver of or limitation on any right of the Grantee to seek relief in federal or state court In the event of any determination by the City to revoke or terminate a franchise, to impose a forfeiture of a bond, letter of credit or other security fund or to impose a substantial financial penalty which would have a material adverse effect upon the Grantee, such a determination shall be stayed during the PAGE 22 pendency of any judicial review thereof Sec 5 1/2-63 Construction Bond (a) Not less than thirty (30) days before the construction start date set forth in any franchise agreement, the Grantee shall obtain and maintain at its cost and expense, and file with the City Secretary, a corporate surety bond in a company authorized to do business in the State of Texas and found acceptable by the City's Risk Manager, in an amount established in the franchise agreement to guarantee the timely construction and/or reconstruction and full activation of the Cable System and the safeguarding of damage to private property and restoration of damages incurred with utilities The bond shall provide, but not be limited to, the following condition There shall be recoverable by the City, jointly and severally from the principal and surety, any and all damages, loss or costs suffered by the City resulting from the failure of the Grantee to satisfactorily complete and fully activate the Cable System throughout the franchise area pursuant to the terms and conditions of this Chapter and the Franchise Agreement (b) Any extension to the prescribed construction or recon- struction time limit must be authorized by the city Council Such extension shall be authorized only when the City Council finds that such extension is necessary and appropriate due to causes beyond the control of the Grantee (c) The construction bond shall be terminated only after the Council finds that the Grantee has satisfactorily completed initial construction and activation or reconstruction of the Cable System pursuant to the terms and conditions of this Chapter and the Franchise Agreement (d) The rights reserved to the City with respect to the construction bond 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 construction bond shall affect any other rights the City may have (e) The construction bond shall contain the following endorse- ment It is hereby understood and agreed that this bond may not be cancelled by the surety nor the intention not to renew be stated by the surety until sixty (60) days after receipt by the City, by registered mail, or written notice of such intent to cancel or not to renew PAGE 23 Sec 5 1/2-64 Authority, Cable TV Advisory Board (a) The City shall exercise continuing regulatory authority under the provisions of this ordinance and applicable law This authority shall be vested in the City Council and administered through the City Manager or his designee This authority includes the adoption of reasonable rules and regulations necessary to enable the City to perform administration and enforcement activities (b) A Cable TV Advisory Board consisting of five (5) members who shall serve for three (3) year terms with such terms to be staggered is hereby established Each board member shall be appointed and shall serve at the pleasure of the council The Board shall advise the City Council on its regulatory jurisdiction and shall have the following responsibilities and duties at the direction of the City Council (1) Resolving disputes or disagreements between sub- scribers and the Grantee after an investigation should the subscriber and the Grantee not first be able to resolve their view or disagreement Said decision or findings may be appealed to the City Council, (2) Reviewing and auditing all reports and filings submitted to the City as required hereunder and such other correspondence as may be submitted to the City concerning the operation of the cable television network, and reviewing the rules and regulations set by the Grantee, and (3) Assuring that all tariffs, rates, and rules pertinent to the operation of the Cable System in the City of Denton are made available for inspection by the public at reasonable hours and upon reasonable requests Sec 5 1/2-65 Procedure for Formal Action (a) Any formal inquiry, proceeding, investigation, or other formal action to be taken or proposed to be taken by the City Council in regard to the operation of a Grantee's cable tele- vision system, including action, if permitted by Federal and State law, in regard to an increase in subscription rates, shall be taken only after thirty (30) days public notice of such action or proposed actions is published in a local daily or weekly news- paper having general circulation in the City of Denton, a copy of such action or proposed action is served directly on the Grantee, and the Grantee has been given an opportunity to respond in PAGE 24 writing and/or a hearing as may be specified by the City Council, and general members of the public have been given an opportunity to respond or comment in writing on the action or proposed action (b) The public notice required by this action shall state clearly the action or proposed action to be taken, the time pro- vided for response and the person or persons and authority to whom such responses should be addressed, and such other proce- dures as may be specified by the Cable TV Advisory Board If a hearing is to be held, public participation will be allowed The Grantee is a necessary party to any hearing conducted in regard to this operation Sec. 5 1/2-66 Functions to be Regulated (a) Each Grantee shall maintain an office in the City, which shall be open during all usual business hours, have a publicly listed telephone, and be so operated that complaints and requests for repairs or adjustments may be received on a twenty-four (24) hour basis (b) Each Grantee shall maintain a repair and troubleshooting force capable of responding to subscriber complaints or request for service within twenty-four (24) hours after receipt of the complaint or request No direct charge shall be made to the subscriber for this service Sec. 5 1/2-67 Subscriber Complaint Procedure (a) Subscriber notice of complaint procedures Each Grantee shall establish procedures for receiving, acting upon and resolving subscriber complaints to the satisfaction of the City Manager The Grantee shall furnish a notice of such procedures to each subscriber at the time of initial subscription to the system and at least once a year thereafter (b) Complaint records The Grantee shall maintain a written record or "log," listing date and time of customer complaints, identifying the subscriber and describing the nature of the com- plaints 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 at least three (3) years, and shall be available for inspection during regular business hours without further notice or demand by the City Manager (c) Repetition of similar complaints When there have been similar complaints made or where there exists other evidence, which, in the judgment of the Council casts doubt on the PAGE 25 reliability or quality of cable service, the Council shall have the right and authority to compel the Grantee to test, analyze and report on the performance of the system 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 (1) The nature of the complaint which precipitated the special tests, (2) What system component was tested, (3) The equipment used and procedures employed in said testing, and (4) The method in which such complaints were recorded Any other information pertinent to the special test shall be recorded Said tests and analyses shall be supervised by a professional engineer, not on the permanent staff of the Grantee The afore- said engineer should sign all records of special tests and forward to the City such records with a report interpreting the results of the tests and recommending actions to be taken by the City The City's right under this provision shall be limited to requiring tests, analyses and reports covering specific subjects and characteristics based on said complaints or other evidence when and under such circumstances as the City has reasonable grounds to believe that the complaints or other evidence require that tests be performed to protect the public against substandard cable service Sec 5 1/2-68 Equal Opportunity Policy (a) A Grantee shall not deny service, deny access, or other- wise discriminate against subscribers, channel users, or general citizens on the basis of race, color, religion, national origin, or sex (b) A Grantee shall strictly adhere to the equal employment opportunity requirements of the FCC, as expressed in Sections 76 13 (h) and 76 311 of Chapter 1 of Title 47 of the Code of Federal Regulations and Section 634 of the Cable Act The Grantee shall comply at all times with all other applic- able federal, state, city, and county laws, and all executive and PAGE 26 administrative orders relating to nondiscrimination The Grantee shall make a positive effort to hire racial minorities, women and other protected groups as subcontractor if available and qualified Sec. 5 1/2-69 Payment of Franchise Fee (a) For the reason that the streets to be used by the Grantee in the operation of its system within the boundaries of the City are valuable public properties acquired and maintained by the City at great expense to its taxpayers, and that the grant to the Grantee to the use of said streets is a valuable property right without which a Grantee would be required to invest substantial capital in right-of-way costs and acquisitions, and because the City will incur costs in regulating and administering the franchise, the Grantee shall pay to the City, for the first ten years from the date of acceptance from a franchise, an amount equal to five percent (5%) of Grantee's gross annual revenue from all sources attributable to the operations of the Grantee within the confines of the City Should a franchise agreement exceed ten years in length, the Grantee shall pay a franchise fee equal in amount to the maximum permitted by law, provided that such amount shall not exceed seven percent (7%) (b) The franchise fee shall be payable quarterly to the city The Grantee shall file a complete and accurate verified statement of all collected gross revenue including itemization for each type of revenue received within the City during the period for which said quarterly payment is made, and said payment shall be made to the City not later than forty-five (45) days after the expiration of the date for which payment is due (c) The Executive Director of Finance of the City may, from time to time during the term of a franchise, prescribe standards governing the nature, extent and type of accounting system and accounting procedures utilized by the Grantee and require changes in accounting standards or procedures utilized by the Grantee, for the purpose of promoting the efficient administration of the franchise fee requirements of this ordinance Any such standards shall be in writing, shall be filed with the City Secretary, and shall be mailed to the Grantee to whom directed The Grantee shall promptly comply with all such standards During the term of each franchise, the City may, not more frequently than once a year, conduct an audit of the books, records and accounts of the Grantee for the purpose of determining whether the Grantee has paid franchise fees in the amounts pre- scribed by Section 5 1/2-69(a) The audit may be conducted by PAGE 27 the city staff or by an independent certified accounting firm retained by the City, and shall be conducted at the sole expense of the City The party conducting the audit shall prepare a written report containing its findings, and the report shall be filed with the City, and mailed to the City and Grantee Any additional amount due the City as a result of the audit shall be paid within 30 days following written notice to the Grantee from the City (d) In the event that any franchise payment or recomputed amount, cost or penalty, is not made on or before the applicable dates heretofore specified, interest shall be charged from such date, compounded daily, at the annual rate equivalent to the then existing prime rate, as established by NCNB Texas National Bank, Dallas, plus two (2%) percent Sec 5 1/2-70 Rates To the extent permitted by federal and state law, the City may regulate the following rates, fees and charges (a) Rates for the provision of basic cable service to subscribers whether residential or commercial, including multiple tiers of basic cable service (b) Rates for the initial installation or the rental of one set of the minimum equipment which is necessary for the subscribers' receipt of basic cable service (c) Any other rates for any type of services delivered by the Grantee that may become subject to local regulation The Grantee may petition the Council for a change in rates subject to regulation by filing a proposed rate schedule with the City Clerk The following procedure shall be followed (1) The Grantee may petition the council for a change in rates by filing a revised rate schedule including the justification(s) for said proposed new schedule, (2) Within ten (10) days of notification by the Council of the place and time established for a hearing on said petition, the company shall notify its subscribers of the same day by announcement on at least two (2) channels of its system, between the hours of 7 00 and 9 00 p m , for five (5) consecutive days Following all proper notice, but in no event later than ninety (90) days from the date of said petition, the council shall hold an appropriate public hearing to consider the proposed PAGE 28 new rates, at which hearing all parties desiring to be heard, including the company, shall be heard on any matters relating to the performance of this franchise, the company's services, and the proposed new rates, (3) Within ninety (90) days after said hearing, the Council shall render a written decision on the company's petition, either accepting, rejecting, or modifying the same and reciting the basis of its decision, (4) The criteria for the Council's decision in such matters shall be the establishment of rates which are fair and reasonable to both the company and its subscribers and shall be generally defined as the minimum rates necessary to meet all applicable cost of service, including fair return on all invested capital, all assuming efficient and economical management (5) In order for the Council to determine whether proposed rate changes comport with the criteria established in subsection (4) above, the company's petition for a rate increase shall include the following financial reports, which shall reflect the operations of the Denton system only (i) Balance sheet, (ii) Income statement, (iii) Cash flow statement, (iv) Statement of sources and applications of funds, (v) Detailed supporting schedules of expenses, income, assets and other items as may be required, (vi) Statement of current and projected sub- scribers and penetration The Grantee's accounting records applicable to system shall be available for inspection by the City at all reasonable times The City shall have access to records of financial transactions for the purpose of verifying burden rates or other indirect costs prorated to the Denton operation The documents listed above shall include sufficient detail and/or iootnotes as may be necessary to provide the City with the information needed to make accurate determinations as to the financial condition of the system All financial statements shall be certified as accurate by an officer of Grantee PAGE 29 Sec 5 1/2-71 User classes and divisions Subscribers may be divided into commercial and residential classes. Nothing in this provision shall prohibit the reduction or waiving of charges in conjunction with promotional campaigns for the purpose of attracting subscribers Rates for commercial and noncommercial users of access channels may be established separately Nothing herein shall prohibit preferential rates for noncommercial users if approved by the City Sec 5 1/2-72_ Advance charges and deposits A franchise may require subscribers to pay for each month of basic service in advance at the beginning of each month No other advance payment or deposit of any kind shall be required by a Grantee for basic subscriber service No deposit or advance payment of any kind shall be charged for the provision of any converter without prior approval of the City Nothing in this provision shall be construed to prohibit charges or waiver of charges for initial installation or reconnection Sec. 5 1/2-73 Installation and reconnection Except as otherwise provided elsewhere in this chapter, a Grantee may make a charge to subscribers for the installation of service outlets and for the reconnection of service outlets The rates for such connection or reconnection shall be authorized by the City as provided in this article Sec 5 1/2-74 Disconnection There shall be no charge for disconnection of any installation or outlet if any subscriber fails to pay a properly due monthly subscriber fee, or any other properly due fee or charge, the Grantee may disconnect the subscribers service outlet, provided, however, that such disconnection shall not be effected until thirty (30) days after the due date of said delinquent fee or charge and shall include ten (10) days written notice of the intent to disconnect delivered to the subscriber in question if a subscriber pays thirty (30) days after payment is due and after notice of disconnection has been given, a Grantee shall not disconnect After disconnection, upon payment in full of the delinquent fee or charge, the payment of reconnection charge, a Grantee shall promptly reinstate a subscriber's cable service Sec 5 1/2-75 Records and Reports (a) Annual reports No later than March 31st of each year, PAGE 30 each Grantee shall submit a written report to the City, in a form directed by the City Council, which shall include (1) A summary of the previous year activities and development of this system, including, but not limited to, services begun or dropped, subscriber gain or loss, (2) Copies of the financial statements audited by a the City, certified i cluding public the accounting fs acceptable and incomeovstat ment, and working papers relating to subscriber accounts, (3) A current statement of costs of construction by component categories, (4) A summary of complaints, identifying the number and nature of complaints and their disposition, (5) A list of officers and members of the board of the franchisee and the parent corporation, if any, (6) A list of all stockholders holding three (3) per cent or more of the voting stock of a Grantee and the parent corporation, if any (b) Filings with federal communication Copies of all petitions, filings, reports, and correspondence filed with the Federal Communication Commission will be filed concurrently with the City (c) Monthly reports required (1) During construction, upgrading, or rebuilding of system, a monthly progress report shall be filed by the Grantee with the City describing projected construction activity for the project, work accomplished for the particular month and for the total project to date (2) Summary of telephone call activity as to total calls received, answered, abandoned or delayed with the average delay quantified (3) Summary of service calls showing number resolved within 24 hours and number of calls unresolved within 24 hour period This summary shall be in a format that can describe the general nature of calls received as to the type of service, problem, or grievance PAGE 31 (4) Summary of system outages for the month (includes all outages affecting two or more subscribers ) This report shall show the number of outages, number of subscribers affected, the number of hours in which the system was down, and the cause for the outages, i e power failure, storm, system malfunction, etc (5) Summary of subscriber statistics for the month, show- ing by category of service provided (i a basic service, each pay TV option, etc the number of subscribers at beginning of month, plus connects, less disconnects, equaling the ending number of subscribers for the month Changes in the number of homes passed by the Cable System shall be shown in a similar manner (d) Other records The City may impose reasonable requests for additional information, records and documents Sec 5 1/2-76 Insurance Requirements (a) A Grantee seeking to operate under the authority of this chapter shall, prior to the granting of a franchise for cable television operation by the City of Denton, submit to approval by the City's Risk Manager satisfactory evidence in the form of certificates of insurance or their equivalent including but not limited to the following coverage and risk areas (1) worker's compensation and employee's liability cover- age on all employees of the franchise as required by statute, (2) Comprehensive general liability coverage including a blanket contractual liability provision and a broad form damage endorsement covering but not limited to explosion, collapse or other underground activity, (3) Comprehensive automobile liability coverage (b) The minimum limits of coverage on each of the above described coverages excepting (1) (a) above shall in no event be less than one million dollars ($1,000,000 00) (c) All insurance policies required by this section shall be so endorsed as to make the City of Denton a named insured under such policy Further, each policy shall be so endorsed as to require the carrier or carriers to give not less than sixty (60) days notice of cancellation or nonrenewal to the City of Denton Such policies shall further carry an endorsement providing a waiver of any rights of subrogation in the favor of and to the City of Denton PAGE 32 Sec 5 1/2-77 Use of Public Property and Conditions for Use (a) A Grantee shall not open or disturb the surface of any street, sidewalk, driveway, or public place for any purpose without first having obtained a permit to do so in accordance with applicable City ordinances, including but not limited to Chapter 21 of the Code of Ordinances, provided that a Grantee shall not be required to post a bond prior to commencing such disturbance of such public place (b) A Grantee shall, at its expense, protect, support, temporarily disconnect, relocate in the same street or other public place, or remove from the street or other public place, any property of the Grantee when required by the City of Denton by reason of traffic conditions, public safety, street vacation, street construction, change of establishment of street grade, installation of sewer, drains, water pipes, city owned power or signal lights, and tracks or any other type of structure or improvement by a public agency (c) The Grantee's use of existing poles or conduits belong- ing to the City of Denton, or the erection or construction of new poles or conduits shall be governed by a separate pole use agreement (d) All wires, conduits, cables and other property and facilities of the Grantee shall be so located, constructed, installed and maintained as not to endanger or unnecessarily interfere with the usual and customary trade, traffic and travel upon the streets of public places of the city The Grantee shall keep accurate maps and records as requested by the city A Grantee shall not place poles or other equipment where they will interfere with the rights or reasonable convenience of adjoining property owners, or with any gas, electric, or telephone fixtures placed in a street shall be placed in the right-of-way between the roadway and the property, as specified by the city (e) All wires, cables, amplifiers, and other property shall be constructed and installed in an orderly and workmanlike manner All cables and wires shall be installed parallel with existing telephone and electric wires whenever possible Multiple cable configurations shall be arranged in parallel and bundled, with due respect for engineering and safety consideration All installations shall be underground in those areas of the city where public utilities providing either telephone or electric service are underground In areas where both telephone and electric utility facilities are above ground at the time of PAGE 33 installation, the Grantee may install its service above ground with the understanding that at such time as those facilities are required to be placed underground by the city, the Grantee shall likewise place its service underground without additional cost to the residents of the city other than as may be granted under the provisions of this chapter (f) The city shall give the Grantee reasonable notice of plans for street improvement where paving or resurfacing of a permanent nature is involved The notice shall give the Grantee sufficient time to make any additions, alterations, or repairs to its facilities as it deems necessary in advance of the actual commencement of the work, so as to permit the Grantee to maintain continuity of service (g) The Grantee shall, on the request of any person holding a building moving permit, temporarily raise or lower its wires to permit the moving of said building The expense of such temporary removal, raising or lowering of the wires shall be paid by the person requesting the same, and the Grantee shall have the auth- ority to require such payment in advance (h) The Grantee shall have the authority to trim trees overhanging upon streets, alleys, sidewalks, and other public places of the city so as to prevent the branches of such trees from coming in contact with the wires and cables of the company All trimming is to be done under the supervision and direction of the city and at the expense of the Grantee The Grantee shall make every effort to preserve the aesthetic beauty and viability of any trees trimmed The Grantee may contract for such services, however, any firm or individual so retained shall receive city approval prior to commencing such activity (i) Public buildings shall be connected to the cable system at no charge Such requests for service may be initiated by authorized local government officials For planning purposes, one service drop per facility should be anticipated at the civic center, municipal building, service center, the county courthouse, police and fire facilities, public library, all public and parochial schools If more than one drop is required (per facility), the charge should be based on Grantee's costs of time and materials No monthly charges should be made for providing basic subscriber services at these public buildings Failure of Grantee to complete connection of basic service drop within 120 days of receipt of written request shall constitute a material breach (j) Upon the request of an authorized university official, PAGE 34 academic buildings and residence halls at the University of North Texas and Texas Woman's University should be connected to the cable system at no charge if more than one service drop is required (per building), the charge should be based on the company's cost of time and materials No monthly charges should be made for providing basic cable subscriber services at the academic buildings (k) The Grantee may be required to interconnect its system with all other broadband communications facilities Such inter- connection shall be made within the time limit established by the city The interconnection shall, at the city's discretion, be accomplished according to the method and technical standards determined by the city, in a manner consistent with applicable FCC standards (1) At the expiration of the franchise term, or upon its termination as provided for herein, the city shall have the right to require the Grantee to remove at its own expense all portions of the Cable System from all streets within the city Sec. 5 1/2-78 Indemnification (a) Each Grantee shall, at its sole expense, fully indemnify, defend and hold harmless the City, and in their capacity as such, the officers, agents and employees thereof, from and against any and all claims, suits, actions, liability and judgments for damages or otherwise (1) For actual or alleged injury to persons or property, including loss of use of property due to an occurrence, whether or not such property is physically damaged or destroyed, in any way arising out of or through or alleged to arise out of or through the acts or omissions of the Grantee or its officers, agents, employees, or contractors or to which the Grantee's or its officers, agents, employees or contractors acts or omissions in any way contribute, (2) Arising out of or alleged to arise out of any claim for damages for invasion of the right of privacy, defamation of any person, firm or corporation, or the violation or infringement of any copyright, trademark, trade name, service mark or patent, or of any other right of any person, firm or corporation, and (3) Arising out of or alleged to arise out of Grantee's failure to comply with the provisions of any statute, regulation or ordinance of the United States, State of Texas or any local agency applicable to the Grantee in its business PAGE 35 Nothing herein shall be deemed to prevent the parties indemnified and held harmless herein from participating in the defense of any litigation by their own counsel at the Grantee's sole expense Such participation shall not under any circum- stances relieve the Grantee from its duty of defense against liability or of paying any judgment entered against such party ARTICLE VIII APPLICANT SELECTION PROCESS Sec. 5 1/2-80 Written application required No license, franchise, or renewal thereof shall be issued except upon written application to the city council on an appli- cation form prescribed by the city council Such form shall contain such information as the city council may prescribe as to the citizenship and character of the applicant, and the financial, technical and other qualifications of the applicant to operate the system, complete information as to its principals and ultimate beneficial owners, including, in the case of corporations, all stockholders, both nominal and beneficial, owning one percent or more of the issued and outstanding stock, and, in the case of incorporated associations, all members and ultimate beneficial owners, however designated, complete information on the extent and the quality of the service, number of channels, hours of operation, variety of programs, local coverage, safety measures, installation and subscription fees, and such other information as the city council may deem appropriate or necessary Such application shall be signed by the applicant or by a duly authorized representative, evidence of whose authority shall be submitted with the application Each applicant shall make full disclosure of the true owner of the applicant and of the equipment to be employed and rendering service and of the source of funds for the purchase, lease, rental and installation of such equipment Each applicant shall set forth as completely as possible the equipment to be employed, the routes of the wires and cables, the area or areas to be served, the approximate starting and completion dates of construction of the system and the dates service will actually be available to the areas named Each applicant shall submit a nonrefundable application fee as may be established by the City Council, to cover the costs of review, issuance and enforcement of franchises issued pursuant to this ordinance Sec. 5 1/2-81. Award Procedure Not later than ninety days after the final date for filing PAGE 36 applications, one or more public hearings shall be held on the applications At the time set for the hearing, or at any adjournment thereof, the City Council shall proceed to hear all comments Not later than ninety days after such public hearing, the City Council shall make a determination based upon an evaluation of the applications, the hearings, and other information that the Grantor may deem relevant No provision of this Chapter shall be deemed or construed so as to require the granting of a franchise when, in the opinion of the City Council, it is in the public interest to restrict the number of grantees to one or more Sec. 5 1/2-82 Additional Information The City Council may at any time demand and applicants shall provide such supplementary, additional or other information as the City Council may deem reasonably necessary to determine whether the requested franchise should be granted ARTICLE IX SERVICE FACILITIES Sec. 5 1/2-90 Required Services and Facilities (a) A franchise application or proposal for renewal shall include a description of the Grantees system design and a description of programming and services being offered, including optional premium services, a description of facilities being proposed for local origination programming, and facilities being offered to various community institutions The offer of programming and services contained within a Grantee's application shall be deemed a binding offer of such Grantee for and to the benefit of the City and the subscribers of Grantee In the event a program originator ceases to provide a service, or in the event the Grantee determines that other programming or cable services may be of greater benefit to subscribers, the Grantee may, subject to subsections (b) and (c), substitute services (b) The system, after the incorporation of such substitute services, shall satisfy the warranty made by Grantee to sub- scribers and potential subscribers in its application for a franchise The City Council, on behalf of system subscribers, shall have the right to review any substitution of service that the Grantee has made and may order a change therein if it determines, after due hearing on notice, that the warranty has been violated, and that certain broad categories of video or other information programs that were committed by Grantee in its PAGE 37 Proposal are not being delivered Any such order shall be issued only after a public hearing has been scheduled and held, and written notice of such hearing shall have been provided to the Grantee and to the public at least 14 days prior to such hearing Any such order may be enforced by a court of competent jurisdiction A Grantee shall not, in relation to this section, be deemed to have waived any right accorded to a franchised cable television operator arising under the First Amendment to the Constitution of the United States (c) Notwithstanding subsections (a) and (b), a Grantee may, in accordance with the Cable Act of 1984, upon 30 days' advance notice to the City, rearrange, replace, or remove a particular cable service required by the franchise if (1) such service is no longer available to the Grantee, or (2) such service is available to the Grantee onl upon the payment of a royalty required under section 801(b)~2) of title 17, United States Code, which the Grantee can document (a) is substantially payment required on the date of such service, and in excess of the amount of such the Grantee's offer to provide (b) has not been specifically compensated for through a rate increase or other adjustment Notwithstanding subsections (a) and (b), a Grantee may take such actions to rearrange a particular service from one service tier to another, or otherwise offer the service, if the rates for all of the service tiers involved in such actions are not subject to regulation Sec 5 1/2-91 Access Channels (a) Each cable system franchised by the City shall provide the number of access channels agreed to in the franchise agreement (b) If any governmental or educational access channel is being utilized more than ten hours per day, five days a week between the hours of 6 00 a m and 11 00 p m for twelve (12) consecutive weeks, or if any public access channel is being used eighty (80) percent of the time between 4 00 p m and 11 00 p m for twelve (12) consecutive weeks, Grantee shall, upon receipt of written notice from City, make new channel(s) available for the same purpose(s), provided, however, that nothing in this paragraph shall require Grantee to construct additional channel capacity to PAGE 38 the cable system for the sole purpose of providing additional access channel capacity Such requirement may be met by making available, on a part-time basis, one or more other underutilized channels, or on a full or part-time basis one or more other unused access channels until such time as such underutilized or unused channels are needed for the uses to which they have been dedicated (c) Whenever any access channel, other than the basic access channels, required in a franchise agreement for governmental, educational and public access, is utilized less than four (4) hours per day for five days per week for a continuous period of not less than twelve (12) consecutive weeks, the City may permit different or additional "interim" uses for said channel The Grantee may be permitted to utilize unused access channel capacity under rules and procedures established by the City, however, no access capacity shall be utilized by the Grantee until all other channel capacity on the cable system has been programmed (d) Access channels permitted by the City for "interim" use by a cable operator are to be restored to governmental, educational or public access use whenever the criteria in subsection (b) are exceeded for any one of the existing access channel uses or whenever the demand for use as demonstrated by records of each access channel indicate that an excessive number of people or programs are being turned away by lack of channel capacity available Sec 5 1/2-93 New Developments (a) Subsequent to each Reevaluation Session, as set forth in Sec 5 1/2-22 and in any franchise agreement, the City Council shall have the authority to order a public hearing on the provision of additional channel capacity by Grantee or on the inclusion in the Grantee's Cable System of "state-of-the-art" technology, or upgraded facilities Notice of such hearing shall be provided to Grantee and the public not later than fourteen (14) days prior to such hearing (b) If after such hearing, the City Council determines that (1) there exists a reasonable need and demand for additional channel capacity and/or state-of-the-art technology or upgraded facilities, and (2) provision has been made or can be made for reasonable rates which will allow Grantee a fair rate of return on its investment (including the investment required to provide the additional channels and/or the state-of-the-art technology, or upgraded facilities), and (3) will not result in economic waste for the Grantee, the City Council may order Grantee to pro- PAGE 39 vide a specified number of additional channels and/or specified state-of-the-art technology or upgraded facilities In consider- ing the economic feasibility of required system improvements the City Council may consider the extension of the term of the fran- chise to permit the recovery of the cost of said improvements Any proposed extension of a franchise shall be treated procedurally in accordance with the procedure for franchise renewal. Without implying any limitations as to other provisions of this Chapter, this Section is deemed a material provision within the meaning of Section 5 1/2-23 of this Chapter Sec. 5 1/2-96 5 1/2-99 Reserved ARTICLE X MISCELLANEOUS Sec. 5 1/2-100 Severability If any section, sentence, clause or phrase of this chapter is held unconstitutional or void, such unconstitutionality or void- ness shall not affect the validity of the remainder of the chapter, Provided, however, that in the event that any section hereof is held invalid, that such section or sections will be renegotiated by the City Council and the Grantee Sec. 5 1/2-101. Rights Reserved to City (a) Nothing contained in this Chapter shall be deemed or construed to impair or affect, in any way, to any extent, the right of the City to acquire the property of a Grantee, either by purchase or through the exercise of the right of eminent domain, at a fair and just value, which shall not include any amount for the franchise itself, or for any of the rights or privileges granted, and nothing contained in this Chapter 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 (b) There is hereby reserved to the City every right and power which is required to be reserved by the provisions of this Chapter or by Local, State or Federal law, and a Grantee, by its acceptance of any franchise, agrees to be bound thereby and to comply with any action or requirements of the City in its exercise of such rights or power heretofore or hereafter enacted or established (c) Neither the granting of any franchise under the provisions PAGE 40 of this Chapter nor any provision of this Chapter shall constitute a waiver or bar to the exercise of any governmental right or power of the City (d) The City Council may do all things which are necessary and convenient in the exercise of its jurisdiction under the pro- visions of this Chapter and may determine any question of fact which may arise during the existence of any franchise granted under the provisions of this Cha ter The City Manager is hereby authorized and empowered to adsust, settle, or compromise any controversy or charge arising from the operations of any Grantee under the provisions of this Chapter, either on behalf of the City, the Grantee, or any subscriber, in the best interests of the public (e) Insofar as it is not inconsistent with or otherwise pre- empted by Federal or State regulations, the City Council retains all authority to regulate non-cable communications to the extent necessary to assure the delivery of proposed non-cable services, if any, and that they are in compliance with all regulatory provisions of this Chapter SECTION II That all ordinances or parts of ordinances in conf ct w t the provisions of this ordinance are hereby repealed SECTION III Any person who shall violate a provision of this or nance, or fails to comply therewith or with any of the requirements thereof, or of a permit or certificate issued there- under, shall be guilty of a misdemeanor punishable by a fine not exceeding Two Hundred Dollars ($200 00) Each such person shall be deemed guilty of a separate offense for each and every day or portion thereof during which any violation of this ordinance is committed, or continued, and upon conviction of any such viola- tions such person shall be punished within the limits above SECTION IV That the City Secretary is hereby directed to cause t e caption of this ordinance to be published twice in the Denton Record-Chronicle, the official newspaper of the City of Denton, Texas, within ten (10) days of the date of its passage this ordinance and -shall become effective the day of _Y)~ 19W ; PASSED AND APPROVED this the J-=- day of 1983 RAY f P S, Y1AYUK PAGE 41 ATTEST (-t)a *h771 JE I PER L S, CITY SECRETARY APPROVED AS TO LEGAL FORM DEBRA ADAMI DRAYOVITCH, CITY ATTORNEY BY PAGE 42 ORDINANCE NO q9- o 9-c-- AN ORDINANCE OF THE CITY OF DENTON, TEXAS DISSOLVING THE CABLE TELEVISION ADVISORY BOARD AND REPEALING SECTION 8-130(b) OF THE CODE OF ORDINANCES AND REPEALING ORDINANCE NO 96-168 AND PORTIONS OF ORDINANCE NO 88-182 RELATING TO THE CABLE TELEVISION ADVISORY BOARD AND ANY OTHER ORDINANCE IN CONFLICT WITH THIS ORDINANCE CONVEYING THE APPRECIATION OF THE COUNCIL TO ALL CURRENT AND FORMER MEMBERS OF THE CABLE TELEVISION ADVISORY BOARD, PROVIDING A SAVINGS CLAUSE, AND PRESCRIBING AN IMMEDIATE EFFECTIVE DATE WHEREAS, by Ordinance No 88-182 and Section 8-130(b) of the Code of Ordinances of the City of Denton, the Council of the City of Denton, Texas established a Cable Television Advisory Board to provide leadership, guidance, and needed assistance to the City Council in decisions involving the disputes between subscribers and the cable television franchise holder, to review filings, reports, rates, tariffs, and rules of the franchuse holder, and to advise the City Council on its regulatory jurisdiction, and WHEREAS, through its service to the Council and the citizens of Denton, the Cable Television Advisory Board proved its worthiness for over a decade, and WHEREAS, as a result of the need to combine and eliminate those boards and commissions that have fulfilled their functions and are no longer needed due to City staff being able to advise the Council on all aspects of their duty and functions, the City Council deems it necessary to dissolve the Cable Television Advisory Board, NOW, THEREFORE, THE COUNCIL OF THE CITY OF DENTON HEREBY ORDAINS SECTION I That Section 8-130(b) of the Code of Ordinances of the City of Denton, which created the Cable Television Advisory Board of the City of Denton, is hereby repealed, along with Ordinance No 96-168 and those portions of Ordinance No 88-182 which create and define the powers and functions of the Cable Television Advisory Board Any other ordinances in conflict with this ordinance are also repealed to the extent of any such conflict only SECTION II That the Council of the City of Denton, Texas hereby conveys its deepest appreciation to all current and former members of the Cable Television Advisory Board for their loyal and dedicated service to the City Council and the citizens of Denton SECTION III That save and except as repealed hereby, all of the sections, clauses, sentences, and phrases of Chapter 8 of the Code of Ordinances of the City of Denton and Ordinance No 88-182 shall remain in full force and effect SECTION IV That this ordmance shall become effective immediately upon its passage and approval Page 1 of 2 PASSED AND APPROVED this th day of AAe-' 11999 JACK R, MAYOR ATTEST JENNIFER WALTERS, CITY SECRETARY BY APPROVED AS TO LEGAL FORM HERBERT L PROUTY, CITY ATTORNEY, BY P NMMdepNLGLW Oo=wWYDrdNmWWdedw mWe n mh6M bowddoe Page 2 of 2