(A) Initial rates for basic subscriber service and/or other freely offered services. The grantee’s initial rates for basic subscriber service and/or other freely offered services shall conform to the format outlined in Attachment B and will be those as proposed in the official proposal and accepted by the city. Such rates shall remain in force for two years from the date that the grantee activates the system within the city. Such activation shall mean substantial completion of such installation, with service available to at least 90% of the houses to which access is provided to the grantee within the city.
(B) Changes in rates for basic subscriber service and/or other freely offered services. Such rates shall be subject to modification only by the Council and only in accordance with the following procedures:
(1) The grantee may petition the Council for a change in rates by filing a revised rate schedule in the form of Attachment B, including its justification(s) for such proposed new schedule.
(2) Within ten days of notification by the Council of the place and time established for a hearing on such petition, the grantee shall notify its subscribers of the same by announcement on at least two channels of its system, between the hours of 7:00 a.m. and 9:00 p.m., for five consecutive days. Following all proper notice, but in no event later than 90 days from the date of such petition, the Council shall hold an appropriate public hearing to consider the proposed new rates, at which hearing all parties desiring to be heard, including the grantee shall be heard on any matters relating to the performance of this chapter, the grantee’s services, and the proposed new rates.
(3) Within 90 days after such hearing, the Council shall render a written decision on the grantee’s petition either accepting, rejecting, or modifying the same and reciting the basis of its decision.
(4) If the Council fails to act within six months of the date of the grantee’s petition pursuant to § 725.09(B)(1) above, the grantee shall thereafter be entitled to put its proposed new rates into effect on a provisional basis, provided that it shall keep a full and accurate accounting of all income resulting from such provisional rates and shall be obliged for a period of up to six months thereafter to refund the amount by which such provisional rates exceed the rates ultimately established by the Council. Upon request by the Council, the grantee shall provide a bond or other reasonable surety in an amount not to exceed the previously existing rates to ensure that possible refunds due under this subsection shall be promptly made.
(5) The criteria for the Council’s decision in such matters shall be the establishment of rates which are “fair and reasonable” to both the grantee and its subscribers and shall be generally defined as the minimum rates necessary to meet all applicable costs of service, including a fair return on all invested capital, all assuming efficient and economical management. The Council and the grantee both recognize that appropriate models and methods for rate regulation of cable are in an evolutionary period and intend that the Council should be guided by the body of law and precedents which will be developing over time. Until more precise standards are thereby developed and absent special showings to the contrary, the Council and the grantee agree that rate changes not exceeding changes from the date hereof in any, some, or all of the indicators appearing below, shall be considered “fair and reasonable” provided that the grantee shall have made a reasonably adequate showing of the applicability of such indicator(s) to the rate issue at hand:
(a) The Handy-Whitman Cost Index of “Total Distribution Plant” (now listed on Line No. 38) for the North Central Region which includes Ohio;
(b) The arithmetic average of monthly, single-family subscriber rates for the Ohio Cable Television Systems; or
(c) Any other reputable index or indicator generally recognized as being apposite to cable television rates.
(C) All rates to be nondiscriminatory. The grantee shall administer any and all rates and charges so as not to give preference to or discriminate among subscribers of like category or class. Nothing in the foregoing shall be deemed to prevent the grantee from establishing:
(1) Special temporary reduced rates for periodic promotional offers to attract new subscribers, or for subscribers who pay promptly;
(2) Reasonable policies for deposits, penalties, or denial of service where a particular subscriber has proven a bona fide credit problem;
(3) Special schedules of rates and charges for service to premises in annexed areas not meeting the density standards established in § 725.06, provided that the same are not inconsistent with applicable FCC Rules and Regulations; or
(4) Separate rates for commercial and noncommercial users of access channels.
(D) Free connection. The grantee shall furnish, without charge, one connection for each existing public building, as listed on Attachment A; provided that such public buildings are located within areas served by the system and shall furnish, without charge, regular service for such connections so long as such system remains in operation in the area. This provision also applies to any future public building constructed or purchased in the franchise area. Any school, so listed, or added, may install at its expense, but not to exceed the grantee’s actual cost for such installation, such additional connections for classroom purposes as it desires, provided that such connections shall not interfere with the operation of the system, and such additional connections also shall be without charge for regular service.
(E) Disconnection and removal of facilities upon request. Except as otherwise provided by the Council, there shall be no charge for the 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 subscriber’s service outlet, provided, however, that such disconnection shall not be effected until 45 days after the due date of such delinquent fee or charge and shall include five days’ written notice of the intent to disconnect properly mailed to the subscriber in question. After disconnection, upon payment in full of the delinquent fee or charge, any reasonable collection expense or penalty, and the payment of a reconnection charge, the grantee shall promptly reinstate the subscriber’s cable service. Upon termination of service to any subscriber, the grantee shall promptly remove all of its facilities and equipment from the premises of such subscriber upon his or her written request.
(F) Franchise fee.
(1) The grantee herein shall pay to the city for the use of the public ways and other facilities of the city in the operation of the system and for the municipal supervision thereof during the life of the franchise, a sum equal to 3% of the gross annual receipts of the grantee. An additional 2% of the gross annual receipts will be paid by the grantee for the funding of local access programming at such time as the city prepares and the Federal Communications Commission approves, a plan for the conduct, administration and funding of public access programming in the community.
(2) In the event that the law, in the future, permits some larger basis for computing this fee, this Council shall, at its election, be entitled to collect such additional monies up to a maximum of 8% of the gross annual receipts of the grantee. The grantee shall be provided with written notice of Council’s intent 60 days in advance of any such change and the grantee shall be permitted to simultaneously increase its rate by the same percent divided by two to all subscribers. The grantee shall be permitted to petition Council for a rate increase based on the remaining 50% of the increased franchise fee as outlined in § 725.09(B).
(3) The Council shall utilize franchise fees as necessary, to defray the costs of local regulation of the grantee, to support the development of the access channels, and to generally encourage development of the system.
(4) Payments due under this provision shall be payable twice each calendar year on a schedule as agreed on by the grantee and the City Manager. Each such payment shall be accompanied by a report, certified by an officer of the grantee, showing the basis for the computation thereof.
(5) In the event this franchise should be terminated or forfeited prior to the end of the basic 15-year term, the grantee shall immediately submit to the city a financial statement prepared as before required, showing the gross receipts of the grantee for the time elapsed since the last period for which the grantee has paid to the city the required percentage of gross annual receipts, and the grantee shall pay to the city not later than 30 days following the termination of the franchise, a like percentage of such gross receipts.
(6) In the event that any payment is not made on or before the applicable date fixed in § 725.09(F)(4) hereof, interest on such payments shall apply from such date at the yearly rate of 10%.
(7) The city shall have the right to inspect the grantee’s records showing the gross receipts from which its franchise payments are computed and the right of audit and recomputation of any and all amounts paid under this franchise shall be always accorded to the city. No acceptance of any payment by the city shall be construed as a release of or an accord or satisfaction of any claim the city might have for further or additional sum payable under the terms of this chapter or for any other performance or obligation of grantee hereunder.
(8) Payments of compensation made by the grantee to the city pursuant to the provisions of this chapter shall not be considered in the nature of a tax but shall be in addition to any and all taxes which are now or hereafter required to be paid by any law of the United States, the State of Ohio, or the city.
(Ord. 5258, passed 10-28-80) Penalty, see § 725.99