63.001 General provisions
63.002 Franchise requirements and characteristics
63.003 Rights-of-way management and facilities requirements
63.004 Miscellaneous
63.005 Transitional provisions
63.006 Franchisees providing communications service to customers
63.007 Private communications facilities
63.008 Liabilities and penalties
63.009 Remedies not exclusive
63.010 Review, termination, and cancellation
63.011 Foreclosure-receivership
63.012 Reports
63.013 Books and records of the franchise
63.014 Time of essence
63.015 Equal employment opportunity
63.016 Violations
(A) Declaration of findings. The city hereby declares as a legislative finding that the rights-of-way controlled by the city:
(1) Are a unique and physically limited resource;
(2) Are critical to the travel and transport of persons and property in the city;
(3) Are intended for public uses and must be managed and controlled consistent with that intent;
(4) Can be partially occupied by the facilities of providers of communications service, to the enhancement of the health, welfare, and general economic well-being of the city and its citizens; and
(5) Should be subject to specific additional regulations imposed in a competitively neutral, non-discriminatory, and non-discretionary manner as established by this chapter to ensure coordination of providers of communications service, maximize available space, and facilitate entry of a maximum number of providers of communications service and other services in the public interest.
(B) Title. This chapter may be referred to and cited as the "Communications Service Franchise Ordinance."
(C) Applicability. The requirements of this chapter shall apply to the full extent of the terms herein and shall be limited in scope or application only to the extent as may be required by applicable federal or state law, including such changes in applicable law as may be hereinafter enacted. No provisions of this chapter shall be disregarded pursuant to this subsection except on express application to and determination by the city to such effect based on the specific factual circumstances demonstrated. The provisions of this chapter shall be deemed incorporated in each franchise granted.
(D) Preservation of authority. Any rights granted pursuant to this chapter and pursuant to any franchise authorized hereunder are subject to the authority of the city to adopt and enforce generally applicable ordinances necessary to the health, safety, and welfare of the public, as may be amended from time to time (to the extent not in conflict with state or federal law, or franchisee's franchise). Nothing in this chapter shall be deemed to waive a right, if any, that any party may have to seek judicial or regulatory review as to the provisions herein or as to actions of the parties under applicable federal, state, or local law currently in effect or as may hereinafter be amended.
(E) Public inspection of records. Certain information required to be filed with the city pursuant to this chapter is subject to inspection and copying by the public pursuant to the provisions of the Kentucky Open Records Act, KRS 61.870 et seq.
(F) Indemnification. As a condition of use of the rights-of-way, each franchisee at its sole cost and expense, shall indemnify, protect, defend and hold harmless the city, its elected officials, officers, employees, and agents, from and against any and all claims, demands, losses, damages, liabilities, fines, charges, penalties, administrative and judicial proceedings and orders, judgments, remedial actions of any kind, and all costs and expenses of any kind, including, without limitation, reasonable attorney's fees and costs of defense arising, directly or indirectly, in whole or in part, out of or in relation to the city's award of the franchise to that franchisee, the rights granted to the franchisee, or the activities performed, or failed to be performed, by such franchisee under the franchise or use of the rights-of-way, except to the extent such acts or use arise from or are caused by the negligence or willful misconduct of the city, its elected officials, officers, or employees. A franchisee's indemnification under this provision does not apply to any franchisee claims, demands, proceedings, or remedial actions against the city. This indemnification shall survive the expiration or termination of any franchise or use of the rights-of-way. The city shall give franchisee written notice of its obligation to indemnify the city within ten (10) days of receipt of a claim or action pursuant to this section. In the event any such claim arises, the city shall tender the defense thereof to the franchisee and the franchisee shall have the right to defend, settle, or compromise any claims arising hereunder and the city shall cooperate fully herein. If the city determines in good faith that its interests cannot be represented by the franchisee, the franchisee shall be excused from any obligation to indemnify the city.
(G) Compliance with laws. In performing activities and exercising rights and obligations under any franchise, each franchisee and other holder of a franchise shall comply with all applicable federal and state laws, and, consistent with § 63.001(D), local laws, ordinances, regulations and policies, including, but not limited to, all laws, ordinances, regulations and policies relating to construction and use of rights-of-way.
(H) Enforcement; attorneys' fees. The city shall be entitled to enforce this chapter and any franchise granted hereunder through all remedies lawfully available and each franchisee shall pay the city its costs of enforcement, including but not limited to reasonable attorneys' fees, in the event that franchisee is determined judicially to have violated the terms of this franchise.
(I) Relationship of the parties. Under no circumstances shall any franchise authorized by this chapter be construed to create any relationship of agency, partnership, joint venture, or employment between the city and the franchisee.
(J) Defined terms. For purposes of this chapter, the following terms, phrases, words, and their derivatives shall have the meanings set forth in this section, unless the context clearly indicates that another meaning is intended. Words used in the present tense include the future tense, words in the singular number include the plural number, and words in the plural number include the singular. The words "shall" and "will" are mandatory, and "may" is permissive. Words not defined shall be given their common and ordinary meaning.
“AFFILIATE.” Means, as to any person, each person, directly or indirectly, controlling, controlled by, or under common control with such person.
“ANTENNA.” Any device that transmits or receives signals. Such signals include but are not limited to radio and infrared waves for voice, data or video communications purposes.
“COMMUNICATIONS.” The transmission via the facilities, in whole or in part, of video, audio, data, writings, signs, signals, pictures, sounds or other forms of information or intelligence through wire, wireless or other electronic means, regardless of the federal or state statutory or regulatory scheme to which such transmissions may be subject.
“COMMUNICATIONS SERVICE.” The transmission of communications via facilities, to a customer, or to any other person, including a private communications system owner's provision of communications via a private communications system, that is within or outside the territorial limits of the city. Communications service includes, but is not limited to, "telecommunications service," "enhanced service," "information service," "internet access service," "broadband service," "cable service," "video programming service," "other programming service," and Internet-based or "over the top" video service offerings, as those terms are now, or may in the future be, defined under federal law. The term also includes the use of all instrumentalities, facilities, conduits, apparatus and services or functionalities (among other things, the receipt, forwarding, storage, generation or delivery of communications), incidental to or designed to directly or indirectly facilitate or accept communications.
“CUSTOMER.” A person located within the territorial limits of the city who ultimately uses or is intended to ultimately use communications service provided by a franchisee and is the ultimate last user of a communications service.
“FACILITIES.” Any portion of a system located in, along, over, upon, under, or through the rights-of-way.
“FCC.” The Federal Communications Commission of the United States of America or any successor thereto.
“FRANCHISE.” A franchise granted under this chapter, or any other franchise granted by the city pursuant to Sections 163 and 164 of the Kentucky Constitution, or by the Kentucky General Assembly prior to the adoption of Sections 163 and 164 of the Kentucky Constitution, which permits a franchisee to install or operate any facilities in the rights-of-way to provide communications service. Use of this definition in this chapter is not intended to include any license or permit for the privilege of transacting and carrying on a business within the city, as may be required by any other ordinance or laws of the city or the state.
“FRANCHISE FEE.” The fee imposed by the city on franchisee for use of the rights-of-way pursuant to a franchise granted under this chapter.
“FRANCHISEE.” The person to whom a franchise is granted, or its successors, assigns, or transferees.
“LESSEE.” A person who provides communications service within the city solely by leasing facilities and who has no control over what, where or how any facilities are erected, installed, maintained, operated, repaired, removed, restored or otherwise used.
“PERSON.” Individual, partnership, association, corporation, joint venture, legal entity or organization of any kind.
“PRIVATE COMMUNICATIONS SYSTEM.” A system used for delivering communications by a person solely in connection with the internal communications needs of such person's business, provided that such person does not use, or permit the use of, such system to provide communications service to a customer or any other person.
“PRIVATE COMMUNICATIONS SYSTEM OWNER.” A person that owns or leases a private communications system.
“RESELLER SERVICE PROVIDER.” A person who provides communications service within the city solely by reselling communications service and who has no control over what, where or how any facilities are erected, installed, maintained, operated, repaired, removed, restored or otherwise used.
“RIGHTS-OF-WAY.” The surface and space on, above, and below every street, alley, road, highway, lane or other property dedicated or commonly used now or hereafter for utility purposes and facilities. Rights-of-way shall not include public property owned or leased by the city and not intended for rights-of-way use, including, but not limited to, parks, public works property, buildings or overhead lighting.
“STATE.” The Commonwealth of Kentucky.
“SYSTEM.” Any and all equipment, structures, materials or tangible components located in the rights-of-way and used to provide communications service, including without limitation all plant (whether inside or outside), cabinets, surface location markers, fiber strands, electronic equipment, amplification equipment, optic equipment, transmission and distribution structures, antennae, lines, pipes, mains, conduit, ducts, regenerators, repeaters, vaults, pedestals, manholes, handholds, pull boxes, splice closures, wires, cables, towers, wave guides, and anything else designed and constructed for the purpose of producing, receiving, amplifying or distributing communications service.
(Ord. No. 04-2021, § 1, 3-2-21)
(A) Unlawful to operate without a franchise. Unless otherwise specifically authorized under applicable federal or state law, it shall be unlawful for any person to own, erect, install, maintain, operate, repair, replace, remove or restore any facilities in the rights-of-way in the city that are used to provide communications services without a valid, unexpired franchise from the city. Unless otherwise provided hereinafter by city ordinance, reseller service providers and lessees shall not be required to obtain a franchise. Private communication systems shall not require a franchise, but shall be licensed pursuant to § 63.007.
(B) Franchises nonexclusive. The authority granted by the city in any franchise shall be for the nonexclusive use of the rights-of-way. The city specifically reserves the right to grant, at any time, such additional franchises or other rights to use the rights-of-way for any purpose to any other person, including itself, as it deems appropriate, subject to all applicable laws.
(C) Nature of rights granted by any franchise. Franchises shall not convey title, equitable or legal, in the rights-of-way, and shall give only the right to occupy rights-of-way, for the purposes and for the period stated in this chapter and as may be further modified by the franchise in a nondiscriminatory and competitively neutral manner. No franchise may excuse franchisee from obtaining appropriate access or attachment agreements before locating its facilities on another person's facilities. All franchises shall be deemed to incorporate and be limited by the provisions of this chapter.
(D) Application and application fee required.
(1) Applications for an original franchise granted hereunder shall be filed with the city pursuant to the advertisement. All applications received by the city from the applicants will become the sole property of the city. Applicants shall submit all requested information as provided by the terms of this chapter. The following information must be complete and verified as true by the applicant:
(a) Application fee. Applications shall be accompanied by a non-refundable application fee of three thousand five hundred dollars ($3,500.00) payable to the city. The application fee shall be established at the rate set forth above, effective upon final passage of this chapter. Thereafter, the application fee shall be increased every two (2) years, in increments of ten ten dollars ($10.00), if required, based on the most recently-published Consumer Price Index (CPI) at the time. The application fee shall defray in whole or part the city's costs to process any application filed under this chapter and negotiate, award and administer any franchise.
(b) Name and address of applicant. The applicant's name, address, e-mail address and telephone and facsimile numbers; date of application and signature of applicant or appropriate corporate officer(s); the name, address and e-mail address, and telephone and facsimile numbers of a local representative who shall be reasonably available at all times; and information regarding how to contact the local representative in an emergency.
(c) Description of proposed system. Applicants for an original franchise to construct a new system shall provide a description of the proposed system. At a minimum, the description shall include:
1. General description of the project by geographical area.
2. Provide a description of the proposed system components to include but not be limited to:
a. Anticipated number and general location of small cell antennae;
b. Location (aerial/underground) of fiber. Where possible, provide estimated percent aerial and percent underground;
c. Anticipated ground level elements (GLE's) and general locations.
3. For underground fiber installation, discuss proposed installation methodologies. The narrative shall address compliance with FCC standards as related to applicable equipment such as small cell antennae and current acceptable RF design standards currently in practice as well as to those standards found in local ordinances and/or regulations.
4. Discuss anticipated project phasing based on geographic and/or right- of-way limitations, limitations imposed by local events and those internal limitations affected by finance and project logistics.
(d) Communications service. The applicant shall provide a statement setting forth a general description of the communications service the applicant plans to provide over the system.
(e) Applicant organization. The applicant shall be a corporation or limited liability company, partnership or other business entity authorized to do business in the state, as certified by the Secretary of State. The applicant must fully disclose the ownership of the proposed facilities and system.
(f) Additional requirements.
1. Supplementary, additional or other information that the applicant deems reasonable for consideration may be submitted at the same time as its application but must be separately bound and submitted with three (3) copies. The city may, at its discretion, consider such additional information as part of the application.
2. Applications may be modified at any time prior to the opening of the applications, provided that any modifications must be duly executed in the manner that the applicant's application must be executed.
3. A copy of the applicant's certificate of authority from the Public Service Commission ("PSC") where the applicant is lawfully required to have such certificate from the PSC.
4. A copy of the applicant's certificate of authority from the FCC where the applicant is lawfully required to have such certificate from the FCC.
5. A copy of all insurance certificates required under this chapter.
6. A statement signed by the applicant that the applicant agrees to be bound by all provisions of the franchise and agrees to obtain all applicable permits and authorizations prior to constructing, installing, or operating a system in the rights-of-way.
7. The information provided by applicant shall be certified as true and correct, and applicant shall be responsible to certify to the city any material changes to the information provided in the completed application during the term of any franchise.
(g) Supplementation to applications. The city reserves the right to require such supplementary, additional or other information that it deems reasonably necessary for its determinations.
(h) The city's rights reserved. The city reserves the right to waive all formalities and/or technicalities where the best interest of the city may be served, provided that it shall exercise this right in a nondiscriminatory and competitively neutral manner.
(E) Standards and procedures for approval or renewal of franchises. Franchises shall be granted in accordance with Kentucky Constitution Sections 163 and 164. The city shall grant franchises or renewals to any eligible franchisee for the right and privilege to construct, own, operate, repair, replace and maintain facilities in, through and along the city's rights-of-way for the purposes of providing communications service on a nonexclusive basis within the city, subject, however, to the standards, terms and conditions herein set forth within this chapter, and any special conditions as may be provided for in the franchise. All franchisees shall be required to obtain and maintain any necessary and lawful permit, license certification, grant, registration or any other authorization required by any appropriate governmental entity, including, but not limited to, the city, the FCC and the PSC. The city may establish standard franchises setting forth the minimum requirements for all franchisees. Renewals of franchises granted to cable operators shall be governed by and comply with the provisions of Section 626 of the federal Cable Act, 47 U.S.C. § 546, or any such successor statute, and applicable law.
(F) Acceptance and effective date of franchise. Any franchise granted hereunder, together with the rights, privileges and authority granted thereby, shall take effect and be in force from and after the effective date of a resolution granting a franchise hereunder, provided that on or before that date franchisee shall:
(1) Enter into and execute such agreements and documents as required by the city that are consistent with the terms and provisions of this chapter and applicable law;
(2) File such bond or bonds as required in this chapter; and
(3) Advise the city in writing of franchisee's address for mail and official notifications from the city.
(G) Use of rights-of-way; police powers; franchisee's use subordinate. A franchisee shall construct and maintain its facilities in accordance with all applicable federal, state and local laws, including all permit requirements and associated fee payments, and all other city codes and ordinances in effect as of the date of the award of its franchise or thereafter adopted or amended, to the extent permitted by state or federal law, subject to § 63.001(D). The grant of a franchise does not in any way affect the continuing authority of the city through the proper exercise of its home rule or statutory powers to adopt and enforce ordinances necessary to provide for the health, safety and welfare of the public. The city makes no express or implied representation or warranty regarding its rights to authorize the installation or construction of facilities on any particular segment of rights-of-way. The burden and responsibility for making all such determinations in advance of construction or installation shall be entirely upon the franchisee. The use of the rights-of-way authorized by any franchise shall in all matters be subordinate to the city's use and rights therein. Without limiting the generality of the foregoing:
(1) All rights and privileges granted herein are subject to the police powers of the city and its rights under applicable laws and regulations to regulate the construction, operation, and maintenance of franchisee's system, subject to § 63.001(D), including, but not limited to, the right to adopt and enforce additional ordinances and regulations as the city shall find necessary in the exercise of its police powers, the right to adopt and enforce applicable zoning, building, permitting and safety ordinances and regulations, the right to adopt and enforce regulations relating to equal employment opportunities, and the right to adopt and enforce ordinances and regulations concerning the rights-of-way and utility standards.
(2) The city reserves the right to exercise its police powers. Any conflict between the provisions of this chapter or a franchise and any other present or future lawful exercise of the city's police powers shall be resolved in favor of the police powers.
(3) Franchisee shall not be excused from complying with any of the requirements of this chapter or any subsequently adopted amendments to this chapter, by any failure of the city on any one or more occasions to seek, or insist upon, compliance with such requirements or provisions.
(H) Emergencies.
(1) Franchisee shall assign a management level individual to coordinate with, and assist the city in the development of emergency plans.
(2) If at any time, in case of fire or disaster or other emergency situation in the city, it shall become necessary in the reasonable judgment of the city to cut, raise, lower, or relocate any facilities, such cutting, raising, lowering, or relocating may be done, and any repairs rendered necessary thereby shall be made by franchisee, at its sole expense.
(I) Term. A franchise shall be for a term not to exceed twenty (20) years.
(J) Franchise fees. During any period of time which the city opts to forego imposing a franchise fee and to instead participate in the multichannel video programming and service tax system set forth under KRS 136.600 et seq., a franchisee shall not be required to pay franchise fees. Before imposing franchise fees, the city will provide at least sixty (60) days' prior written notice to current franchisees before the first payment will be due. If at any time the city elects to exercise its constitutional right to impose and collect franchise fees, franchisee's first franchise fee payment under this chapter shall be paid to the city the later of one hundred twenty (120) days after such election, or thirty (30) days after the last day of the first calendar quarter expiring after franchisee received written notice from the city that the city has opted to exercise its constitutional right to impose and collect franchisee fees.
(K) Timing of payment of franchise fees. Unless otherwise agreed to in writing, all franchise fees shall be due and payable on a quarterly basis and payment shall be made on or before the date which is thirty (30) calendar days after the last day of the calendar quarter for which the payment applies (the "due date"); provided, however, that in the event that a franchisee ceases to provide communications service for any reason (including as a result of a sale or transfer of the franchisee's system), such franchisee shall make a final payment of any amounts owed to the city on or before the date which is thirty (30) calendar days after the date on which its operations in the city cease (which shall be deemed a "due date" for purposes of this chapter).
(L) Interest on late payments and under payments. If any franchise fee, or any portion thereof, is not received by the city on or before the due date, interest thereon shall accrue from the due date until received, at the rate of 1.5% per month, unless such other maximum rate is established by applicable law.
(M) Fee statement. In the event that the city imposes a franchise fee, any franchise fee payment shall be accompanied by a statement (a "fee statement") showing the manner in which the franchise fee was calculated. Within ninety (90) calendar days following the end of any calendar year in which the city imposes a franchise fee, each franchisee shall submit a statement, certified as true, setting forth the amount of linear feet of rights-of-way occupied by it facilities, provided, however, that in the event that a franchisee ceases to provide communications service for any reason (including as a result of a transfer), such franchisee shall provide such a statement within thirty (30) calendar days after the date on which its operations in the city cease. In calculating the amount of linear feet of rights-of-way occupied by its facilities, a franchise shall include all facilities, including antenna and other wireless facilities, and all facilities whether installed underneath the rights-of-way or on poles.
(N) No accord and satisfaction. No acceptance by the city of any franchise fee or any other payment shall be construed as an accord that the amount paid is in fact the correct amount, nor shall acceptance of any franchise fee or any other payment be construed as a release of any claim of the city.
(O) Description of communications service. During the term of the franchise, franchisee shall provide the city with a description of any material changes to the types of communications service offered over its facilities in the rights-of-way within the city during the prior year. Any individual communications service or item for which the franchisee has a separate charge shall be considered a separate communications service.
(P) Franchise fee not a tax; payment of taxes. The franchise fee is compensation for the use of the rights-of-way and shall in no way be deemed a tax of any kind. The franchise fees required herein shall be in addition to, not in lieu of, any and all taxes, charges, assessments, licenses, fees and impositions otherwise applicable to franchisee that are or may be imposed by the city. A franchisee shall be fully responsible for the payment of all applicable taxes.
(Q) Assignment of franchise. A franchisee shall provide the city with written notice of any transfer or assignment of the franchise. A franchisee shall not sell, assign, sublet, dispose of or otherwise transfer a franchise (or any of the rights or privileges granted by such franchise), franchisee's system, or control of franchisee to another entity other than by operation of law or to an entity controlling, controlled by, or under common control with the franchisee, without the prior written consent of the city. No such consent shall be required, however, for a transfer in trust, by mortgage, by other hypothecation, or by assignment of any rights, title, or interest of the franchisee in the franchise or system to secure indebtedness. The city's consent to such a transfer shall not be withheld if the acquiring entity would have qualified for an original franchise had it applied and if the acquiring entity demonstrates it has the same or equivalent insurance coverage and bonds in place as is required of the original franchisee. Nothing in any approval by the city of any transfer pursuant to this section shall be construed to waive, release or delegate any rights or powers of the city to hold the original franchisee liable for any violation of its franchise.
(R) Forfeiture of franchise and privilege. In case of failure on the part of a franchisee, its successors and assigns, to comply with any of the material provisions of this chapter or its franchise, or if the franchisee, its successors and assigns, should do or cause to be done any material act or thing prohibited by or in violation of this chapter or the terms of its franchise, the franchisee, its successors and assigns, shall forfeit all rights and privileges permitted by this chapter and its franchise, and all rights hereunder shall cease, terminate and become null and void, provided that said forfeiture shall not take effect until the city shall carry out the proceedings specified in § 63.010(B).
(S) Security for payment of fees.
(1) In the event that the city imposes a franchise fee, every franchisee shall provide to the city an irrevocable letter of credit in the amount of twenty-five thousand dollars ($25,000.00), or one half of the annual franchise fee owed, whichever is less, to secure the payment of the franchise fee for the first two (2) years in which the franchisee is subject to a franchise fee. If, thereafter, there has been no default in paying the franchise fee nor any late payment of the franchise fee, the letter of credit shall be released.
(2) This division is inoperative during any period of time during which the city elects to participate in the state baseline and local growth funds under KRS 136.600 et seq., and to have franchisees taxed accordingly.
(T) Special rules for governmental entities. Nothing herein requires the city to apply the provisions of this chapter to a governmental entity if the city determines that it is not in the public interest to do so, and nothing in this chapter shall be read to require a governmental entity to comply with this chapter where the city cannot enforce the ordinance against such entity as a matter of law. The city is authorized to enter into agreements with other governmental agencies to facilitate the city's use and management of the rights-of-way, and such agreements shall be enforceable according to their respective terms and notwithstanding any provision of this chapter.
(Ord. No. 04-2021, § 1, 3-2-21)
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