2008-13 Cable Franchise & Video Service & Continuing Franchise Fees ORDINANCE NO.2008-13
URGENCY ORDINANCE OF THE CITY COUNCIL OF THE CITY OF MENIFEE
ADOPTING MENIFEE MUNICIPAL CODE SECTION REGARDING CABLE FRANCHISE AND
VIDEO SERVICE AND CONTINUING FRANCHISE FEES
THE CITY COUNCIL OF THE CITY COUNCIL OF MENIFEE DOES ORDAIN AS
FOLLOWS:
SECTION 1. CHAPTER 5.06: CABLE SYSTEM FRANCHISE is added to the City of
Menifee Municipal Code to read as follows:
CHAPTER 5.06
Video Franchise Fees, Customer Service and
Other Video-Related Matters
Sections
5.06.010 Regulation of Video Franchises and Definitions
5.06.020 State Video Franchise Fees
5.06.030 Audit Authority
5.06.040 Customer Service and Protection Standards
5.06.050 Material Breach of Customer Standards
5.06.060 Response to Notice of Breach
5.06.070 Request for Exemption from Breach
5.06.080 Penalties for Customer Service and Protection
Standards Violations
5.06.090 Appeal of Penalties for Customer Service and
Protection Standards Violations
5.06.100 City Response to State Video Franchise
Applications
5.06.010. Regulation of Video Franchises and Definitions.
(a) Under Division 2.5 of the California Public Utilities Code ("CPUC'), the Digital
Infrastructure and Video Competition Act of 2006, commencing at Section 5800, et seq.
("DIVCA"), the California Public Utilities Commission (PUC) has the exclusive authority to grant
and administer state video franchises. The definitions contained in DIVCA apply to this Chapter.
(b) Notwithstanding, DIVCA confers certain rights and responsibilities on the City
with respect to state video franchise holders ("SVFH") operating within the City under DIVCA,
including but not limited to, receipt of fees for rent of right of ways in the form of a franchise fee
and additional fees for support of public, educational, and governmental ("PEG') access
channels. Both fees are based on a percentage of the gross revenues of state franchise
holders. The City also hereby establishes and enforces penalties for violations of customer
service rules. The City retains authority, without change, over all City video franchisees until
such time as they no longer hold a City franchise, or are no longer operating under a current
City franchise. The City may modify, renew, extend or terminate existing City video franchises.
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(c) The City Council intends this Ordinance to supplement, not to duplicate or
contradict, applicable state and federal law and this Ordinance shall be construed in light of that
intent. -
5.06.020. State Video Franchise Fees.
(a) Each SVFH, shall pay a fee to the City equal to five percent (5%) of that SVFH's
gross revenue, as defined in CPUC section 5860, pursuant to CPUC section 5840(q)(1).
Failure to pay the fee in a timely manner will incur fines to the City as set out in that section.
(b) Such fees shall be payable as of October 1, 2008, the date of City's
incorporation.
5.06.030. Audit Authority.
Not more than once annually, the City Manager or his/her designee may examine and
perform an audit of an SVFH's records kept in the ordinary course of business, such as those
commonly used and relied upon for accounting purposes or in preparation of financial
statements or pro formas, to ensure compliance with this section. In the event that the audit
discloses an underpayment of five percent (5%) or more, the SVFH shall pay for the audit. If
the audit discloses that all fees have been paid, the City shall pay for the audit; otherwise, the
cost shall be divided evenly between the parties.
5.06.040. Customer Service and Protection Standards.
(a) An SVFH shall comply with all applicable state and federal customer service and
protection standards pertaining to the provision of video service. In addition, the SVFH shall
prepare, adopt and annually review its own consumer standards regarding installation and
service; telephone and office hours; billing procedures; termination of service; change in
service; and complaint procedures. Each SVFH annually must distribute such standards to the
City and to each customer.
(b) The City shall give the SVFH written notice of its failure to distribute such notice.
If distribution does not occur within 60 days after receipt of the notice, the City may impose and
collect a penalty of$500 for each year in which the notice is not distributed after such notice.
5.06.050. Material Breach of Customer Standards.
Where the City Manager determines that an SVFH has materially breached any
provision of its own consumer standards or of state or federal law, including but not limited to
nonpayment of franchise fees, the City may provide written notice of the breach ("Notice of
Breach") to the SVFH.
(a) A "Material Breach" is defined as an SVFH's substantial and repeated failure to
comply with service quality and other standards of federal or state law or of its own consumer
standards.
(b) Receipt of a Notice of Breach shall be deemed to have occurred either:
(1) Five (5) calendar days after the date on which the Notice of Breach was
deposited to be mailed with the United States Postal Service or equivalent;
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(2) Two (2) calendar days after the date the Notice of Breach was sent via
facsimile or-e-mail; or
(3) On the date an SVFH's designated representative was personally served
the Notice of Breach.
5.06.060. Response to Notice of Breach.
An SVFH which has been issued a Notice of Breach shall either remedy the conduct
described in the Notice of Breach ("Notice of Breach Conduct") to the satisfaction, and in the
sole discretion of, the City Manager no later than thirty (30) calendar days from the date of
receipt of the notice; or assert that the SVFH should be exempted from violation because the
violation is out of its control.
(c) If the SVFH asserts that the Notice of Breach Conduct is out of its reasonable
control, then the SVFH shall submit a Request for Exemption From Breach. A Request for
Exemption From Breach shall contain all of the following points in order to be considered by the
City Manager: It shall be in writing; it shall describe in detail why the conduct was out of its
reasonable control; it shall describe in detail the Notice of Breach Conduct, the reasons for its
occurrence, all factors and/or influences asserted to be outside the SVFH's control thereby
creating the conduct, and all facts precluding the SVFH's ability to remedy; and it shall include
as attachments any and all supporting documentation which the SVFH wishes the City Manager
to review. Only information so submitted shall be considered by the City Manager.
5.06.070. Request for Exemption from Breach. Where the City Manager receives a Request
for Exemption From Breach, City Manager shall review the Request for Exemption From Breach
promptly; and shall render a final determination on the Request for Exemption From Breach.
This final determination shall be in writing and shall include one of the following conclusions: (i)
The Notice of Breach Conduct is outside the SVFH's control and is therefore Exempt or (ii) The
Notice of Breach Conduct is within the SVFH's control and is therefore subject to the provisions
of this Chapter.
(d) The City Manager's decision is final.
5.06.080. Penalties for Customer Service and Protection Standards Violations.
(a) Each SVFH that fails to remedy the Notice of Breach Conduct in violation of this
Section ("Un-remedied Breach,") and/or that fails to obtain an exemption determination shall pay
a penalty to the City as set out here.
(b) Penalties for an SVFH's failure to remedy the Notice of Breach Conduct shall
accrue daily as follows:
(1) Commencing on the first calendar day following expiration of the time to
cure in through the date of remedy of the breach under Section; or
(2) Commencing on the first calendar day following receipt of denial of a
Request for Exemption From Breach through the date of remedy of the breach.
4846-8028-4163.1 3
(c) An SVFH shall pay a penalty for the un-remedied first Notice of Breach not to
exceed a fine of$500 for each calendar day, not to exceed $1,500 for each occurrence of an
Un-remedied Breach.
(d) For a second Material Breach of a similar nature as the Notice of Breach for
which a penalty was assessed, occurring within twelve (12) months from the date of the first
Notice of Breach, whether remedied or not, an SVFH shall pay a penalty accruing not to exceed
$1,000 per calendar day, not to exceed $3,000, for each occurrence of an Un-remedied Breach.
(d) For a third or further Material Breach, of a similar nature as the Notice of Breach
for which a penalty was assessed, occurring within the same twelve (12) months of the date of
the Notice of Breach, whether or not remedied an SVFH shall pay a penalty not to exceed
$2,500 per calendar day, not to exceed $7,500 for each occurrence of an Unremedied Breach.
5.06.090. Appeal of Penalties for Customer Service and Protection Standards Violations.
(a) An SVFH assessed a penalty under Section 5.06.080 may appeal the assessed
penalty only by satisfying all of the following: Submit to the City Manager a written appeal
describing in detail the basis for the appeal; and file the appeal no later than sixty (60) calendar
days from receipt of the notice of penalties; and
(b) Where the City Manager receives an appeal under this Section, the City Manager
shall review the appeal promptly, render a final determination on the appeal, and provide a final
written determination; and
(c) The City Manager's determination on the appeal shall be final. The penalty owing
shall be a debt to the City that may be collected in any legally available manner.
5.06.100. City Response to State Video Franchise Applications.
(a) Applicants for state video franchises within the boundaries of the City of Menifee
shall concurrently provide complete copies to the City of any application or amendments to
applications filed with the PUC. The applicant shall provide one complete copy to the City Clerk,
and another complete copy to the City Manager.
(b) In its discretion, the City may provide any comments to the PUC on the
application or amendments to the application.
SECTION 2. EFFECTIVE DATE. The City of Menifee incorporated October 1, 2008.
This ordinance needs to take effective immediately in order to assure the continued receipt of
franchise fees and related fees pursuant to state franchises.
SECTION 3. POSTING/PUBLICATION, The City Clerk shall certify the passage of this
ordinance and have it published or posted in accordance with Council Policy and state law,
either in a daily newspaper of general circulation in the City of Menifee or by posting for ten (10)
days in three public places designated by the City Council.
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PASSED, APPROVED AND ADOPTED, this /L day of December, 2008 by the
following vote:
NOES:
ABSENT::'_/��11 UY`—,��L
ABSTAI N:
Wallace W. Edgerton, Mayor
ATTEST:
Kathy Bennett, Deputy City Clerk
Approved as to Form:
Eliza eth Martyn, City Attorney
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