(A) Unlawful to operate without a franchise. It shall be unlawful for any person to erect, install, maintain, operate, repair, replace, remove or restore communications facilities or to provide communications services by use of facilities in the rights-of-way in the city without a valid, unexpired franchise from the city, unless otherwise specifically authorized under applicable federal or state law, or otherwise provided by city ordinance. Unless otherwise provided hereinafter by city ordinance, reseller service providers and lessees shall not be required to obtain a franchise.
(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 limited by the franchise. 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 and shall create rights inuring solely to the benefit of the franchisee.
(D) Application and application fee required.
(1) Applications for an original communications franchise granted hereunder shall be filed with the City Clerk with ten additional copies. 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) Filing fee. Applications shall be accompanied by a non-refundable application fee of $2,500 payable to the city. Said application fee shall compensate the city and defray in whole or part the city's costs to process any application filed under this chapter and negotiate, award and administer any franchise. Said application fee shall not be considered communications franchise fee payments.
(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 available at all times; and information regarding how to contact the local representative in an emergency.
(c) Description of proposed system. A description of the applicant's proposed system design.
(d) Services. A statement setting forth a description of all the types of services proposed.
(e) Applicant organization.
1. If the applicant is an individual, partnership, or unincorporated association, it shall state the names and addresses of all persons (including corporations) having a proprietary or equitable interest in and to the applicant's business operation, and in and to the prospective communications franchise if granted. The term equitable interest shall include all assignments of value, as well as all contingent assignments of any right or privilege under the prospective communications franchise, and shall also include any benefit, payment, or emolument whatsoever resulting from the grant of a communications franchise under this chapter.
2. If the applicant is a non-public corporation, the application shall state, additionally, the names and addresses of the officers, directors, and shareholders of the corporation, together with the number of shares held by each shareholder.
3. If the applicant is a publicly held corporation, as defined by the rules and regulations of the Securities and Exchange Commission, the application shall contain the states in which the applicant is incorporated and/or qualified to do business, the names and addresses of the officers, directors, and shareholders owning 20% or more of applicant's outstanding stock, together with the number of shares held by each shareholder.
4. If the applicant is a corporation, the application shall provide written evidence that it is authorized to do business in the state, as certified by the Secretary of State.
5. Applicant must fully disclose the ownership of the facilities to be used in rendering the service.
(f) Intra-company relationships. An organizational chart depicting the applicant's intra-company relationships, including parent, subsidiary or affiliate companies.
(g) Technical description. A technical description of the type of system proposed by the applicant and applicant's five year plan for the installation of the system. The following information shall be included in the application:
1. If the applicant is proposing an underground installation in existing ducts or conduits within the rights-of-way, information in sufficient detail to identify:
a. The excess capacity currently available in such ducts or conduits before installation of applicant's system; and
b. The excess capacity, if any that will exist in such ducts or conduits after installation of applicant's system.
2. If franchisee is proposing an underground installation within new ducts or conduits to be constructed within the rights-of-way:
a. The location, depth, size and quantity of proposed new ducts or conduits;
b. The excess capacity that will exist in such ducts or conduits after installation of applicant's system.
3. A preliminary installation schedule and completion date.
(h) Existing franchises. Applicants, including all shareholders and parties with any interest in the applicant, shall disclose the locations of all other franchises and the dates of award for each location.
(i) Engineering statement. A statement from the applicant's senior technical staff member, or consultant, advising that the applicant's planned system and operations thereof would meet all the requirements set forth herein.
(j) Litigation and violations.
1. A statement as to whether the applicant or any of its officers or directors or holders of 20% or more of its voting stock has in the last ten years been involved in litigation which in any way is related to the operation and performance of a communications system or in any way relates to the applicant's ability to perform its obligations under this chapter.
2. A statement as to whether the applicant or any of its officers or directors or holders of 20% or more of its voting stock has in the last ten years been served with notice of a franchise violation by a municipality.
(k) 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 the above number of 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. Conditional applications will not be accepted.
4. 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.
5. 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.
6. A copy of all insurance policies and certificates required under this chapter.
7. A statement signed by the applicant that the applicant agrees to be bound by all provisions of this chapter and agrees to obtain all applicable permits and authorizations prior to constructing, installing, or operating a system in the rights-of-way.
8. The applicant shall keep all of the information required in this section current at all times by providing to the city information of changes within 60 days following the date on which the applicant has knowledge of any change.
9. 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.
(l) Supplementation to applications. The City Commission reserves the right to require such supplementary, additional or other information that it deems reasonably necessary for its determinations.
(m) 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.
(n) Reasonable costs. Franchisee shall be responsible for payment of any reasonable costs incurred by the city in processing these applications and in negotiating, awarding and administering the franchise to the extent such costs exceed the application fees paid including, without limitation, reasonable attorneys' and other consultants' fees.
(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 authorize 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 Services on a nonexclusive basis within the city, subject, however, to the standards, terms and conditions herein set forth within this chapter, which shall be deemed incorporated therein, 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 Kentucky Public Service Commission. The city may establish standard franchises setting forth the minimum requirements for all franchisees.
(F) Acceptance and effective date of franchise.
(1) 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 said date franchisee shall:
(a) File with the city an unconditional acceptance' of the franchise grant and enter into and execute such contracts and documents as required by the city that are consistent with the terms and provisions of this chapter;
(b) File certificates of insurance as set forth in this chapter;
(c) File such bond or bonds as required in this chapter; and
(d) Advise the City Clerk in writing of franchisee's address for mail and official notifications from the city.
(2) Franchisee, by acceptance of any franchise granted hereunder, acknowledges that it has relied upon its own investigation and understanding of the power and authority of the city to grant such a franchise.
(3) Franchisee, by acceptance of any franchise granted hereunder, acknowledges that it has thoroughly examined and is familiar with the terms and conditions of this chapter, the resolution granting the franchise and such other contracts and documents entered into by franchisee relative to the franchise.
(4) Franchisee, by acceptance of any franchise granted hereunder, acknowledges and agrees that the matters contained in franchisee's application for the franchise or supplements thereto, shall be incorporated into the resolution granting the franchise as though set out verbatim and shall thereafter be considered an integral part of such ordinance in all communications, correspondence, filings, or applications with all appropriate regulatory agencies, including but not limited to the FCC or the Public Service Commission.
(G) Cable service and open video systems (OVS); separate franchise required. A communications franchise shall not permit a franchisee to provide cable services as a cable operator (as defined by 47 U.S.C. § 522(5)) within the city. Upon a franchisee's request for a franchise to provide cable services as a cable operator (as defined by 47 U.S.C. § 522(5)) within the city, the city shall timely negotiate such cable franchise in good faith with the franchisee. A communications franchise shall also not permit a franchisee to operate an open video system. A person may operate an open video system only if that Person obtains a separate franchise permitting same, and such person remits the maximum fees permitted by 47 U.S.C. § 573(c)(2)(B) and where such person otherwise complies with FCC regulations promulgated pursuant to 47 U.S.C. § 573. Absent such applicable separate franchise from the city, a franchisee shall be prohibited from offering OVS service and any such service shall be considered a breach of its franchise.
(H) 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 fee payments, and all other city codes and ordinances in effect as of the date of the award of its franchise or thereafter adopted to the extent not in contravention of state or federal law. 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 the 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, 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 containing rights-of-way, communications, and utility standards.
(2) The city reserves the right to exercise its police powers, notwithstanding anything in this chapter and in any franchise to the contrary. 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 latter.
(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.
(4) If federal or state law alter the required services, fees, costs, conditions or standards upon which the communications system is to operate, the city shall have the right to amend this chapter to make it consistent with the modified federal or state laws.
(5) Any franchise granted pursuant to this chapter shall be subject to any present and future legislation or resolution, which may be enacted by the city.
(I) Emergencies.
(1) Franchisee shall assign a management level person to coordinate with, and assist the city's Emergency Management Agency, in the development of emergency plans.
(2) If at any time, in case of fire or disaster in the city, it shall become necessary in the reasonable judgment of the city, to cut or move any facilities, such cutting or moving may be done and any repairs rendered necessary thereby shall be made by franchisee, at its sole expense.
(J) Term. A franchise shall be effective for a term of ten years from its effective date.
(K) Communications franchise fees. Franchisee shall pay to the city a franchise fee in the amount of $10,000. Said fee shall be submitted with grantee's application. In the event the application in denied, the franchise fee shall be returned within ten business days.
(L) Holders of multiple franchises. Persons holding a communications franchise and also a cable franchise shall fairly and accurately apportion and attribute revenues received to the various services offered.
(M) Maintain records. A franchisee shall at all times maintain complete and accurate books of account and records of the business, ownership, and operations of the franchisee with respect to the system in a manner that allows the city to determine whether the franchisee has properly calculated its communications franchise fee in compliance with this chapter. Should the city reasonably determine that the records are not being maintained in such manner, the franchisee shall correct the manner in which the books and/or records are maintained so that the franchisee comes into compliance with this section. All financial books and records which are maintained in accordance with FCC regulations, the regulations of the Kentucky Public Service Commission and any other governmental entity that regulates utilities in the state, and generally accepted accounting principles shall be deemed to be acceptable underthis section. Such books and records shall be maintained for a period of at least three years. The failure to provide information or maintain records as required herein shall be grounds for forfeiture or revocation of a franchise.
(N) Right of inspection and audit. The city or its designated representatives shall have the right to inspect, examine or audit, during normal business hours and upon reasonable notice, all documents, records or other information that pertain to the system and/or a franchisee's communications franchise fee obligations under its franchise. In addition to access to the records of the franchisee for audits, upon request, a franchisee shall provide reasonable access to records necessary to verify compliance with the terms of the franchise. A franchisee shall pay all reasonable audit costs incurred by the city to a maximum of one audit per year.
(O) Description of service. A franchisee shall on an annual basis provide the city with a description of the communications services offered within the city during the prior year. Any individual service or item for which the franchisee has a separate charge shall be considered a separate service.
(P) Communications franchise fee not a tax; payment of taxes. The communications franchise fee is compensation for use of the rights-of-way and shall in no way be deemed a tax of any kind. The communications franchise fees required herein shall be in addition to, not in lieu of, all taxes, charges, assessments, licenses, fees and impositions otherwise applicable that are or may be imposed by the city. A franchisee shall be fully responsible for the payment of all applicable taxes.
(Q) Duty to notify city of reseller service providers and lessees. Each franchisee shall notify the city of the name and address of each reseller service provider and lessee with which it enters into an agreement related to the resale of franchisee's communications services and/or the lease of facilities, provide to the city a copy of all such agreements between franchisee and such reseller service providers and/or lessees, and describe the compensation to be provided to franchisee relating to such reseller service providers and/or lessees.
(R) Sale or lease of facilities. Except as otherwise may be provided by law or franchise, a franchisee shall not sell, or otherwise transfer possession or control of any facilities, or any portion thereof, for any purpose to any person that has not obtained a duly issued franchise which includes the authority to erect, install, maintain, operate, repair, replace, remove or restore such facilities. Franchisee shall provide the city at least 30 days prior notice of any intended sale, lease or transfer of possession or control.
(S) Assignment of franchise.
(1) A franchise does not run with the land. 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) to another person, including, without limitation, by operation of law, without the prior written consent of the city; provided that such transfer may occur without the consent of the city to an affiliate upon 30 days prior notice to the city; and provided, further, that entry into an agreement with a reseller service provider related to the resale of the franchisee's communications services or entry into an agreement with a lessee related to the lease of the facilities shall not, by itself, be deemed such a transfer. The city's consent to such a transfer shall not be unreasonably withheld.
(2) In seeking the city's consent to a transfer, the franchisee and its proposed transferee shall provide to the city in writing:
(a) Such information with respect to the proposed transferee as is currently required of applicants for a renewal of a franchise; and
(b) An agreement, in form and substance acceptable to the city, that the transferee will assume and be bound by all of the provisions, terms, and conditions of this chapter and the franchise and shall be primarily liable and obligated under such documents without, however, relieving the transferring franchisee from its obligations to the city under such documents, including without limitation its obligations under division (V) of this section.
(3) Franchisee shall be liable to the city for any and all costs incurred by the city, including, without limitation, reasonable attorneys' and other consultants' fees, resulting from any such attempt to transfer the franchise.
(4) 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.
(T) 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 provisions of this chapter or its franchise, or if the franchisee, its successors and assigns, should do or cause to be done any 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 following proceedings: Before the city declares the forfeiture or revocation of a franchise, it shall first serve a written notice upon the franchisee, setting forth in detail the neglect or failure complained of, and the company shall have 30 days thereafter, or such other reasonable period established by the City Commission, in which to cure the default by complying with the conditions of its franchise and fully remedying any default or violation. If at the end of such 30 day or other reasonable period, the city determines that the conditions have not been complied with, the city shall take action by an affirmative vote of a majority of the City Commission present at the meeting and voting, to terminate the franchise, setting out the grounds upon which the franchise is to be forfeited or revoked. Nothing herein shall prevent the city from invoking any other remedy available at law or in equity.
(U) 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.
(V) Public benefit services. During the entire ten year term of this franchise, the grantee shall provide the city with DS 3 capibility (at 45 megs per second) over its entire system located within Madison County, Kentucky. The grantee shall cooperate with the city in accessing and connecting with said fiber.
(W) Local On-Net. Grantee shall make available to grantor, for grantor's own internal use, one Local On-Net DS3. A Local On-Net DS3 refers to a DS3:
(1) That is transported wholly over existing fiber owned by grantee; and
(2) That both originates and terminates within the city limits. The two specific endpoints between which the DS3 is to span will be as mutually agreed to between grantor and grantee. If no endpoints are set forth in the franchise agreement, then grantor shall be deemed to have waived its rights under this section, as it relates to that grantee.
(3) Other terms applicable to the Local On-Net DS3 are as follows:
(a) Grantee shall not, under any circumstance, be required to construct new network to support the Local On-Net DS3 to be provided grantor under this section; however
(b) It is contemplated that grantee might undertake some activities to interconnect its network with the mutually agreed to endpoints. In that instance:
1. Grantor hereby grants to grantee, a license to interconnect to, and collocate equipment in, each of the mutually agreed to endpoints (the "license"). The license includes all necessary power, rights of way and building entrance rights. No fees or charges shall be imposed on grantee in connection with, or related to, the license; and
2. Grantor shall pay grantee within 30 days of receipt of grantee's invoice therefore, all costs incurred by grantee for or related to those activities. At grantee's discretion, it may, prior to performing such activities, require a deposit in an amount equal to grantee's reasonable estimate of the costs it will incur for or related to those activities.
(Ord. 05-13, passed 4-26-05)