(A) Term of subscriber contracts. Residential subscriber contracts shall not exceed 12 months in duration, unless after 12 months, the contract may be terminated by the subscriber at any time at his option with no penalty to the subscriber.
(B) Subscriber rates.
(1) No rates shall be increased for a minimum of 30 months from the effective date of this franchise.
(2) (a) Should grantee desire an increase in its rates, grantee shall file an application with the City Manager of the City of Columbia Heights which application shall be supported by proof that the existing rate schedule is inadequate and unreasonable and that the proposed increase is required to enable grantee to fulfill its obligation under the franchise and to enable grantee to derive a reasonable profit therefrom.
(b) Such proof shall include, but not be limited to, the following financial reports, which shall reflect the operations of the system only:
1. Balance sheet;
2. Income statement;
3. Cash flow statement;
4. Statement of sources and applications of funds;
5. Detailed supporting schedules of expenses, income assets, and other items as may be required;
6. Statement of current and projected subscribers and penetration;
7. Such other data as the city may require.
(c) The grantee's accounting records applicable to the system shall be available for inspection by the city and its representatives 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 system operation. The documents listed above shall include sufficient detail and/or footnotes 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 the grantee.
(3) Within 60 days following the filing by grantee of an application for a rate increase with the City Manager of Columbia Heights, the city shall conduct a public hearing to consider the proposed rate increase. The city will publish one notice of said hearing at least ten days prior to the hearing date in the official newspaper of the city. Grantee shall notify the public through providing notice for one week, each day between 7:00 p.m. and 9:00 p.m. on two channels of the purpose, of the date, place and time of the hearing. Any interested person may file written comments on the proposed rate increase with the City Council of Columbia Heights.
(4) After the conclusion of the public hearing, the city will have 90 days within which to make its determination with respect to the proposed rate increase. The city in it's discretion may do one of the following:
(a) Approve the proposed rate increase;
(b) Approve a rate increase but at levels different than proposed in grantee's application;
(c) Determine that no rate change shall be allowed;
(d) Determine that the rate schedule of grantee shall be decreased.
(5) In reviewing a proposed rate change the city may consider at least the following factors:
(a) The ability of the grantee to render system services and to derive a reasonable profit therefrom under the existing rate schedule and under the proposed rate schedule;
(b) The revenues and profits derived from system services;
(c) The efficiency of the grantee;
(d) The quality of service offered by the grantee;
(e) The original cost of the system less depreciation under a reasonable and acceptable depreciation policy;
(f) A fair rate of return with respect to the cost of borrowing and the rates of return on investments having similar risks to that of providing cable communication services;
(g) The cumulative average rate of return forecasted by the grantee when seeking the franchise. This cumulative average rate of return may be adjusted by actual economic conditions such as the percentage variance of the experienced prime rate with the level of the prime rate assumed by the grantee when seeking the franchise;
(h) The extent to which the grantee has adhered to the terms of the ordinance;
(i) Rates currently fixed in cable television franchises for comparable service areas;
(j) Capital expenditures by grantee in providing updated technology and service to subscribers.
(6) The City Council shall not consider any valuation based upon this franchise or the grantee's good will and these items of value shall neither be amortized nor shall a return be paid on them. All costs for the review of an application for a rate change shall be paid for by grantee upon demand of the city.
(C) Prohibition of discriminatory or preferential practices. Grantee shall make the services or facilities available to all persons within the city on an equal basis.
(D) Non-regulated rates. Prior to implementing any rate increase for any service not subject to local rate regulation, other than pay-per-channel or pay-per-view channels, grantee shall give the following notice:
(1) At least 45 days' advance written notice to city together with such supporting documentation as grantee in its sole discretion determines appropriate;
(2) At least 30 days' advance written notice to subscribers of that service; and
(3) Carriage of an announcement of the rate increase on one channel 24 hours a day for seven consecutive days. This announcement may be in the form of a crawl across a portion of the television picture.
('77 Code, § 11.109) (Am. Ord. 982, passed 11-9-81; Am. Ord. 1125, passed 5-27-86; Am. Ord. 1202, passed 6-25-90)