(a) Franchise Purposes. A franchise granted by the city under the provisions of this article may authorize the grantee to do the following:
(1) To engage in the business of providing cable service and such other telecommunications services as may be authorized by law and which grantee elects to provide to its subscribers within the designated franchise service area;
(2) To erect, install, construct, repair, rebuild, reconstruct, replace, maintain, and retain, cable lines, related electronic equipment, supporting structures, appurtenances, and other property in connection with the operation of the cable system in, on, over, under, upon, along and across streets or other public places within the designated franchise service area;
(3) To maintain and operate the franchise properties for the origination, reception, transmission, amplification and distribution of television and radio signals, and for the delivery of cable services and such other services as may be authorized by law.
(b) Franchise Required. It is unlawful for any person to construct, install or operate a cable television system within any street or public way in the city without first obtaining a franchise under the provisions of this article.
(c) Term of the Franchise.
(1) A franchise granted under this article will be for the term specified in the franchise agreement, commencing upon the effective date of the ordinance or resolution adopted by the city council that authorizes the franchise.
(2) A franchise granted under this article may be renewed upon application by the grantee in accordance with the then-applicable provisions of state and federal law and of this article.
(d) Franchise Territory. A franchise is effective within the territorial limits of the city, and within any area added to the city during the term of the franchise, unless otherwise specified in the ordinance or resolution granting the franchise or in the franchise agreement.
(e) Federal or State Jurisdiction. This article will be construed in a manner consistent with all applicable federal and state laws, and it applies to all franchises granted or renewed after the effective date of this article, to the extent authorized by applicable law.
(f) Franchise Nontransferable.
(1) Grantee may not sell, transfer, lease, assign, sublet, or dispose of, in whole or in part, either by forced or involuntary sale, or by ordinary sale, contract, consolidation, or otherwise, the franchise or any of the rights or privileges therein granted, without the prior consent of the city council and then only upon such terms and conditions as may be prescribed by the city council, which consent may not be unreasonably denied or delayed. Any attempt to sell, transfer, lease, assign, or otherwise dispose of the franchise without the consent of the city council is null and void. The granting of a security interest in any assets of the grantee, or any mortgage or other hypothecation, will not be deemed a transfer for the purposes of this subsection.
(2) The requirements of subsection (f)(1) of this section apply to any change in control of grantee. The word “control” as used herein is not limited to the ownership of major stockholder or partnership interests, but includes actual working control in whatever manner exercised. If grantee is a corporation, prior authorization of the city council is required where ownership or control of more than ten percent of the voting stock of grantee is acquired by a person or a group of persons acting in concert, none of whom, singularly or collectively, owns or controls the voting stock of the grantee as of the effective date of the franchise.
(3) Grantee must notify the city in writing of any foreclosure or judicial sale of all or a substantial part of the grantee’s franchise property, or upon the termination of any lease or other interest covering all or a substantial part of that franchise property. That notification will be considered by the city as notice that a change in control of ownership of the franchise has taken place, and the provisions of this paragraph that require the prior consent of the city council to that change in control of ownership will apply.
(4) For the purpose of determining whether it will consent to an acquisition, transfer, or change in control, the city may inquire as to the qualifications of the prospective transferee or controlling party, and grantee must assist the city in that inquiry. In seeking the city’s consent to any change of ownership or control, grantee or the proposed transferee, or both, must complete Federal Communications Commission Form 394 or its equivalent. This application must be submitted to the city not less than one hundred twenty days prior to the proposed date of transfer. The transferee must establish that it possesses the legal, financial and technical capability to operate and maintain the cable system and to comply with all franchise requirements during the remaining term of the franchise. If the legal, financial and technical qualifications of the applicant are satisfactory, the city will consent to the transfer of the franchise. The consent of the city to that transfer will not be unreasonably denied and delayed.
(5) Any financial institution holding a pledge of the grantee’s assets to secure the advance of money for the construction or operation of the franchise property has the right to notify the city that it, or a designee satisfactory to the city, will take control of and operate the cable television system upon grantee’s default in its financial obligations. Further, that financial institution must also submit a plan for such operation within ninety days after assuming control. The plan must insure continued service and compliance with all franchise requirements during the period that the financial institution will exercise control over the system. The financial institution may not exercise control over the system for a period exceeding one year unless authorized by the city, in its sole discretion, and during that period of time it will have the right to petition the city to transfer the franchise to another grantee.
(6) Grantee must reimburse the city for the city’s reasonable review and processing expenses incurred in connection with any transfer or change in control of the franchise. These expenses include, without limitation, costs of administrative review, financial, legal and technical evaluation of the proposed transferee, consultants (including technical and legal experts and all costs incurred by these experts), notice and publication costs, and document preparation expenses. No reimbursement may be offset against any franchise fee payable to the city during the term of the franchise.
(g) Geographical Coverage.
(1) Grantee must design, construct and maintain the cable television system so as to have the capability to pass every dwelling unit in the city, subject to any service-area line extension requirements of the franchise agreement.
(2) After service has been established by activating trunk or distribution cables for any service area, grantee must provide service to any requesting subscriber in that service area within thirty days from the date of request, provided that the grantee is able to secure on reasonable terms and conditions all rights-of-way necessary to extend service to that subscriber within that thirty-day period.
(h) Nonexclusive Franchise. Each franchise granted in nonexclusive. The city specifically reserves the right to grant, at any time, such additional franchises for a cable television system, or any component thereof, as it deems appropriate, subject to applicable state and federal law. If an additional franchise is proposed to be granted to a subsequent grantee, a notice public hearing must first be held in accordance with the provisions of Government Code Section 53066.3.
(i) Multiple Franchises.
(1) The city may grant any number of franchises, subject to applicable state and federal law. The city may limit the number of franchises granted, based upon, but not necessarily limited to, the requirements of applicable law and specific local considerations, such as:
(A) The capacity of the public rights-of-way to accommodate multiple cables in addition to the cables, conduits and pipes of the existing utility systems, such as electrical power, telephone, gas and sewerage;
(B) The benefits that may accrue to subscribers as a result of cable system competition, such as lower rates and improved service;
(C) The disadvantages that may result from cable system competition, such as the requirement for multiple pedestals on residents’ property, and the disruption arising from numerous excavations within the public rights-of-way;
(2) The city may require that any new grantee be responsible for its own underground trenching and the associated costs if, in the city’s opinion, the rights-of-way in any particular area cannot reasonably accommodate additional cables.
(Ord. 760 § 2 (part), 1998)