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ORD 02-17CITY OF OTSEGO, MINNESOTA ORDINANCE NO. 2002-17 SECTION 1. INTENT Section 1.1 Findings. The City finds that multiple providers may be interested in providing Cable Service in the City. The City is authorized to grant one or more nonexclusive Franchises to provide Cable Service in the City. Section 1.2 Intent. The City's intent in adopting this Cable Ordinance is to further the public interest in the delivery of Cable Service and ensure that all providers of Cable Service are subject to comparable burdens consistent with applicable law. This Cable Ordinance may encourage further development of, and competitive choices for, Cable Service and related communications services in the City. Such a development could contribute significantly to the communication needs and desires of residents of the City, benefit local economic development, and improve public and municipal services. SECTION 2. SHORT TITLE This Ordinance will be known and cited as the "Cable Ordinance." SECTION 3. DEFINITIONS For the purposes of this Cable Ordinance, the following terms, phrases, words, and their derivations must have the meaning given herein. Terms, phrases and words contained in this Cable Ordinance that are not defined herein or in a Franchise will have their normal and customary meaning. When not inconsistent with the context, words in the singular number include the plural number. The words "must" and "will" are always mandatory and not merely directory. The word "may" is directory and discretionary and not mandatory. a "Basic Cable Service" means any service tier which includes the lawful retransmission of local television broadcast signals and any public, educational, and governmental access programming required by a Franchise. b "Cable System" means a facility, consisting of a set of closed transmission paths and associated signal generation, reception, and control equipment that is designed to provide Cable Service which includes video programming and which is provided to multiple Subscribers within a community, but such term does not include (1) a facility that serves only to retransmit the television signals of 1 or more television broadcast stations; (2) a facility that serves Subscribers without using any Right -of -Way; (3) a facility of a common carrier which is subject, in whole or in part, to the provisions of subchapter II of 47 U.S.C. § 521, except that such facility shall be considered a Cable System to the extent such facility is used in the transmission of video programming directly to Subscribers, unless the extent of such use is solely to provide interactive on - demand services; (4) an Open Video System that complies with 47 U.S.C. § 573; or (5) any facilities of any electric utility used solely for operating its electric utility systema d "Cable Service" means (1) the one-way transmission to Subscribers of (i) video programming, or (ii) other programming service; and (2) Subscriber interaction, if any, which is required for the selection or use of such video programming or other programming service. e h e " means a portion of the electromagnetic frequency spectrum which is used in a System and which is capable of delivering a television channel (as television channel is defined by the FCC by regulation). f "CW" means the City of Otsego, Minnesota, a municipal corporation, in the State of Minnesota. g "Competition" means the offering of Cable Service to substantially the same potential customers in the City by two (2) or more providers pursuant to Franchises. h "DLA" means the cable that connects the ground block on the Subscriber's Terminal Device to the nearest feeder cable of the System. i "=' means the Federal Communications Commission, or its lawful successor. j "Franchise", "Cable Franchise" or "Franchise Ag er .ement' means an agreement between the City and any provider of Cable Service pursuant to this Cable Ordinance granting an initial authorization, or renewal thereof, to provide Cable Service or operate a System in the City. k "Ecg" means a franchise fee, a fee on Gross Revenues in -lieu of a franchise fee or an assessment imposed by the City on a Grantee solely because of its status as a recipient of a Franchise. The term "Franchise Fee" does not include: (i) any tax, fee or assessment of general applicability; (ii) capital costs which are required by the Franchise related to the provision of public, educational, or governmental access facilities; (iii) requirements or charges incidental to awarding or enforcing the Franchise, including payments for bonds, security funds or letters of credit, insurance, indemnification, penalties or liquidated damages; (iv) any fee imposed under Title 17 of the United States Code. 1 "Grantee' is any recipient of a Franchise, and its agents and employees, lawful successors, transferees or assignees. m "Gross Revenues" means all revenues received by a Grantee or its affiliates from the sale or provision of Cable Service in the City. By way of example and not limitation, Gross Revenues shall include all carriage revenues received by a Grantee or its affiliates from unaffiliated video programming providers, and any advertising revenues received by a Grantee or its affiliates in connection with the provision of Cable Service. Gross Revenues shall not include bad debt, any taxes or fees on services furnished by Grantee imposed by any municipality, state, or other governmental unit and collected by Grantee for such governmental unit, revenues received by the Grantee or its affiliates from the provision of Telecommunications Services in the City, Fees collected by a Grantee or its affiliates from Subscribers, and any other fees collected by a Grantee or its affiliates from Subscribers to support PEG Access Facilities. n "Installation" means the connection of the System with the Subscriber Terminal Device. o "Lockout Device" means an optional mechanical or electrical accessory to a Terminal Device which inhibits the viewing of a certain program, certain Channel or Channels provided over a System. p "Normal Business Hours" means those hours during which most businesses in the City are open to serve customers. Normal Business Hours generally means between 8:00 a.m. and 5:00 p.m. but must include some evening hours at least one night per week and/or some weekend hours. q "Normal Qperating Conditions" means those service conditions which are within the control of a Grantee. Those conditions which are not within the control of a Grantee include, but are not limited to, natural disasters, civil disturbances, power outages, telephone network outages, and severe or unusual weather conditions. Those conditions which are ordinarily within the control of a Grantee include, but are not limited to, special promotions, pay-per-view events, rate increases, regular peak or seasonal demand periods, and maintenance or upgrade/construction of a Grantee's facilities. r "Oven Video System' means a facility consisting of a set of transmission paths and associated signal generation, reception, and control equipment that is designed to provide Cable Service which includes video programming and which is provided to multiple subscribers within a community, provided that the FCC has certified such Open Video System complies with 47 C.F.R. Subpart S. s "Pay Television' means the delivery of pay -per -channel or pay -per -program audio-visual signals to Subscribers for a fee or charge, in addition to the charge for Cable Service. t "PEG Access Facilities" means public, educational, and governmental programming channels, or any equipment or facilities for use of such Channels. u "Person" means any natural person, firm, partnership, association, corporation, company, or other legal entity. v " Ri t -of -WW' or "Ri is -of -Way" means the area on, below, or above a public roadway, highway, street, cartway, bicycle lane, and public sidewalk in which the local government unit has an interest, including other dedicated rights-of-way for travel purposes and utility easements of local government units. Right -of -Way does not include the airwaves above a Right -of -Way with regard to wireless or other nonwire telecommunications or broadcast service. w "Right -of -Way Ordinance" means an ordinance adopted by the City creating requirements regarding regulation, management and use of Rights -of -Way, including registration and permitting requirements. x "Standard Installation' means any residential installation that can be completed using a Drop of 150 feet or less. y "Subscriber' means any Person who lawfully receives Cable Service via a System. z "System" means a Cable System, an Open Video System or any other network of antennas, cables, wires, lines, towers, waveguides, or other conductors, terminal devices, equipment, or facilities located in whole, or in part, in the City and designed and constructed for the purpose of producing, receiving, transmitting, amplifying, or distributing Cable Service in the City. as "Telecommunications Services" shall have the meaning ascribed in 47 U.S.C. § 153(46), as may be explained or interpreted by final action of the FCC. ab "Terminal Device" means an electronic device that converts signals to a form accessible by the Subscriber. SECTION 4. FRANCHISES Section 4.1 Generally a No Person may provide Cable Service in the City, nor operate a System in the City, unless and until such Person is granted a Franchise. All Franchises must be granted pursuant to the provisions of this Cable Ordinance. b Any Franchise granted hereunder will authorize the Grantee to deliver Cable Service and construct, operate and maintain a System in the Rights -of -Way in the City. c All Franchises shall be nonexclusive, and City may grant additional Franchises at any time. To the extent consistent with applicable law, the City will not grant a Franchise for an area included in an existing Franchise on terms and conditions more favorable or less burdensome than those in the existing Franchise pertaining to: (1) the area served; (2) public, educational, or governmental access requirements; or (3) franchise fees, unless the area in which the additional Franchise is being sought is not actually being served by any existing Grantee. The City may impose additional terms and conditions on any additional Franchises. d This Cable Ordinance and Franchises granted pursuant hereto are intended to comply with Minnesota Statutes Chapter 238 and applicable law. Any applicable requirement established by Minn. Stat. § 238.084 not expressly incorporated in this Cable Ordinance or a Franchise shall be deemed incorporated by reference in the Franchise as though fully set forth therein. e The performance of any Grantee is subject to periodic evaluation by the City upon reasonable notice to the Grantee. Section 4.2 Use of Rights -of -Way a Use of the Rights -of -Way to provide Cable Service and operate a System must not be inconsistent with the terms and conditions by which such Rights -of -Way were created or dedicated and is subject to all legal requirements related to the use of such Rights -of -Way. b The City may adopt and enforce a Right -of -Way Ordinance and all Grantees shall be subject to such Right -of -Way Ordinance. To the extent that rights, duties and obligations regarding the use of Rights -of -Way are specifically addressed in a Franchise, such Franchise terms shall prevail over any conflicting provisions of a Right - of -Way Ordinance. The terms of the Cable Ordinance shall be subordinate to any conflicting provisions of a Right -of -Way Ordinance. A Grantee shall not, through adoption or amendment of a Right -of -Way Ordinance be subject to additional burdens or obligations with respect to usage of the Right -of -Way which exceed the burdens on other users of the Right -of -Way under a Right -of -Way Ordinance. c The City may construct, maintain, repair or relocate sewers; grade, pave, maintain, repair, relocate and/or alter any Right -of -Way; construct, repair, maintain or relocate water mains; or construct, maintain, relocate, or repair any sidewalk or other public work. d All System facilities, lines and equipment in the City must be located so as not to obstruct or interfere with the proper use of Rights -of -Way, alleys and other public ways and places, and cause minimum interference with the rights of property owners who abut any of the said Rights -of -Way, alleys and other public ways and places, and not interfere with existing public utility installations. e A Grantee must file with the City maps, plats, or other record of the location and character of all facilities constructed in the City, including underground facilities. A Grantee must update such maps, plats and permanent records annually if changes have been made in the System. Consistent with applicable state law, Grantee may identify such maps, plats or other records as "confidential trade secret," and City shall comply with all state laws regarding the protection and dissemination of such materials. f If the City alters, or changes the grade or location of any Right -of -Way, alley or other public way, a Grantee shall, at its own expense, upon reasonable notice by City, remove and relocate poles, wires, cables, conduits, manholes and other System fixtures, and in each instance comply with the standards and specifications of City. If City reimburses other occupants of the Right -of -Way, the affected Grantee will be likewise reimbursed. g A Grantee shall not place poles, conduits, or other System fixtures where the same will interfere with any gas, electric, telephone, water or other utility fixtures and all such poles, conduits, or other fixtures placed in any Right -of -Way shall be so placed as to comply with all lawful requirements of City. h A Grantee will, on request of any Person holding a moving permit issued by the City, temporarily raise or lower its wires or fixtures to permit the moving of buildings with the expense of such temporary removal to be paid by the Person requesting the same, and the Grantee will be given no less than ten (10) business days advance notice to arrange for such temporary changes. A Grantee may require payment in advance. i A Grantee will be liable for the failure to exercise reasonable care during construction, operation or maintenance of a System. Section 4.3 Tree Trimming A Grantee is authorized to trim trees in or overhanging Rights -of -Way to the extent reasonably necessary to prevent the branches of such trees from coming in contact with wires and cables of a System, or as is otherwise necessary to protect a System. The City may condition the authority to trim trees as it deems appropriate and may supervise tree trimming activities. Section 4.4 Franchise Term. Franchises will be granted for a term established in the Franchise Agreement. No Franchise may be granted for a period exceeding fifteen (15) years from the date of acceptance by Grantee. Section 4.5 Regulation of Cable Service. a The requirements of this Cable Ordinance define the City's regulatory authority over Systems and Cable Services subject to applicable laws. All Grantees are subject to all lawful exercise of the City's police power, ordinance -making authority, and power of eminent domain. b The terms of a Franchise Agreement define the contractual rights and obligations of the City and the Grantee thereunder. Section 4.6 Initial Franchise Applications. a Upon request or its own initiative, the City may initiate a cable franchise application process consistent with Minnesota Statutes Section 238.081 and other applicable laws. Any Person desiring an initial Franchise must file an application with the City. b The City will establish an application fee in an amount to offset the costs of processing applications and awarding a Franchise. Such application fees will not constitute a Franchise Fee. c Upon receipt of an application for a Franchise, City staff will prepare a report and recommendations to the City Council regarding the application(s). d A public hearing concerning applications will be held prior to rejection or acceptance of applications, and award of any Franchises. Section 4.7 Franchise Renewal. Franchise renewals will be conducted in accordance with applicable laws. To the extent consistent with applicable laws, the City will require reimbursement of the City's expenses incurred in processing the renewal. SECTION 5. CONSTRUCTION STANDARDS Section 5.1 Registration, Permits and Construction Codes. a Within ninety (90) days of acceptance of a Franchise, the Grantee must apply for the necessary governmental permits, licenses, certificates, and authorizations to construct, repair, replace, relocate, operate, maintain or reconstruct a System. Grantees must strictly adhere to all state and local laws and building and zoning codes currently or hereafter applicable to location, construction, installation, operation or maintenance of the facilities used to provide Cable Service in the City. b The City may inspect any construction or installation work performed pursuant to the provisions of a Franchise. The City may make such tests as it must find reasonably necessary to ensure compliance with the terms of this Cable Ordinance, the Franchise, and applicable provisions of local, state and federal law. Section 5.2 Repair of Rights -of -Way and Property. a Any Rights -of -Way or other property disturbed or damaged during the construction, repair, replacement, relocation, operation, maintenance or reconstruction of a System shall be fully and promptly restored, subject to weather conditions (i.e., winter conditions/frozen ground), by the Grantee performing such work, at its expense, to a condition as good as that prevailing prior to such work. b If a Grantee fails to promptly perform the restoration required herein, the City shall have the right, following ten (10) business days written notice to Grantee, to restore Rights -of -Way and other public property to a condition as good as that prevailing prior to the Grantee's work. The City shall be fully reimbursed by the Grantee for its actual costs relating to such restoration. Section 5.3 Undergrounding of Facilities. a In all areas of the City where utility facilities are required to be placed underground, or where all other utility lines are underground, all Grantees must construct and install System facilities underground. b Amplifier boxes and pedestal mounted terminal boxes may be placed above ground, but such facilities shall be of such size, design, and location as not to be unsightly or unsafe, as reasonably approved by the City. c A Grantee must bury new Drops within a reasonable time period, which must not exceed fifteen (15) business days, subject to weather conditions. In the event the ground is frozen, a Grantee will be permitted to delay burial until the ground is suitable for burial which in no event must be later than June 30th. Section 5A Erection, Removal and Joint Use of Poles. a In any area of the City where facilities may be located above ground, a Grantee must make use of existing poles and other facilities to the extent technically and economically feasible. b No poles, above -ground conduits, amplifier boxes; similar structures, or other wire -holding structures may be erected or installed by the Grantee on public property without prior approval of the City with regard to location, height, type and other pertinent aspects. c All facilities are subject to applicable zoning and other land use regulations. Section 5.5 Safety Requirements. a A Grantee must at all times employ ordinary and reasonable care in the construction, installation and maintenance of System facilities and must use commonly accepted methods and devices for preventing failures and accidents which are likely to cause damage, injuries, or nuisances to the public. All System facilities must at all times be kept and maintained in good condition, order, and repair so that the same must not menace or endanger the life or property of the City or any Person. b A Grantee must install and maintain equipment and facilities in accordance with all applicable federal, state and local laws and regulations, and the requirements of the National Electric Safety Code and in such manner that they will not interfere with private radio, police and fire communications or any installations of City or of any public utility serving City. SECTION 6. SYSTEM DESIGN AND EXTENSION PROVISIONS Section 6.1 System Capacity and Channels. At a minimum, any Franchise granted hereunder shall describe the Grantee's network in terms of the total System capacity such as the total number of analog and digital video channels which can be provided, and the minimum number of video channels which will be offered. Section 6.2 Cable Service Availability. a Any Franchise granted hereunder may authorize Cable Service throughout the City, or a portion thereof. b Each Franchise will identify a required service area. A Grantee will be required to offer Cable Service to all dwellings, homes and businesses within its required service area. Franchises may authorize and require Cable Service throughout the corporate boundaries of the City, as it exists from time to time, or such smaller area as the City reasonably and lawfully deems appropriate and is agreeable to the Grantee. c Any Franchise granted hereunder may establish requirements for the extension of the System and provision of Cable Service beyond the initially required service area. d Cable Service shall not be denied to any group of potential residential cable Subscribers because of the income of the residents of the area in which such group resides. Section 6.3 Non -Standard Installations. Grantees must provide Cable Service to any Person requesting other than a Standard Installation provided the Cable Service can meet FCC technical specifications and all payment obligations are met, except that a Grantee may charge for the incremental increase in material and labor costs incurred above the cost of making a Standard Installation. Section 6.4 Technical Standards. Any System offering Cable Service in the City must comply, at minimum, with the technical standards promulgated by the FCC relating to Cable Systems pursuant to Title 47, Section 76.601 to 76.617, as may be amended or modified from time to time. Section 6.5 System Testing. a In the event City finds that there are signal or System performance difficulties which may constitute violations of applicable FCC technical standards, the Grantee will be notified and afforded fifteen (15) business days to investigate and, if necessary, correct problems or complaints. If the performance difficulty is not resolved within fifteen (15) days the City may require the Grantee to demonstrate compliance via testing or other means selected by the Grantee. b If a performance difficulty continues after the provision of Section 6.5(a), the City may test any System or facilities used to provide Cable Service in the City. The City will seek to arrange its testing so as to minimize hardship or inconvenience to Grantee and Subscribers. In the event that testing reveals that the source of the technical difficulty is within the Grantee's reasonable control, the cost of the testing must be borne by the Grantee. If the testing reveals the difficulties to be caused by factors that are beyond Grantee's reasonable control, the cost of the testing must be borne by the City. Section 6.6 FCC Reports. Grantees must, upon written request from City, file all required FCC technical reports with the City. Section 6.7 Nonvoice Return Capability. Grantees are required to provide a System with capacity and technical capability to provide nonvoice return communications. Section 6.8 Lockout Device. Grantees shall provide by sale or lease a Lockout Device to any requesting Subscriber. Section 6.9 Emergency Alert System. All Grantees must provide an emergency alert system (EAS) that complies with FCC requirements. Grantees must further ensure that City can insert, or direct the insertion of, brief audio and video emergency messages simultaneously on all channels. The City shall indemnify Grantee for City's use of a System for emergency messages unless such use is consistent with the FCC's EAS requirements. SECTION 7. CONSUMER PROTECTION AND CUSTOMER SERVICE STANDARDS Section 7.1 Enforcement of Customer Service Standards. This Section 7 shall be fully applicable except during periods when Competition exists in the City. The City will stay and not enforce this Section 7 in areas where Competition exists in the City, except that the City may initiate enforcement of this Section while Competition exists in the event the City receives, in any thirty (30) day period, at least five (5) written complaints with respect to each competitor concerning similar customer service issues. In such case, the City Council may initiate enforcement of this Section by adopting a Resolution indicating the basis for initiating enforcement. Section 7.2 Regulation of Cable Service Rates. a The City may regulate rates for the provision of Cable Service to the extent allowed under federal or state law(s). b Grantees must file a list of current Subscriber rates and charges with the City, which lists will be maintained on file with City and will be available for public inspection. Grantees must give the City and Subscribers written notice of any change in a Cable Service rate or charge no less than thirty (30) days prior to the effective date of the change. Section 7.3 Sales Procedures. A Grantee may not exercise deceptive sales procedures when marketing any of its Cable Services within City. Grantees may conduct marketing consistent with local ordinances and other applicable laws and regulations. Section 7.4 Telephone Inquiries and Complaints. a A Grantee must maintain local, toll-free or collect call telephone access lines which will be available to its Subscribers 24 hours a day, seven days a week. b During Normal Business Hours, trained representatives of Grantee must be available to respond to Subscriber inquiries. Grantees must ensure that: (1) an adequate number of trained company representatives will be available to respond to customer telephone inquiries during Normal Business Hours, and; (2) after Normal Business Hours, the access line will be answered by a trained company representative or a service or an automated response system such as an answering machine. c Inquiries received after Normal Business Hours must be responded to by a trained company representative on the next business day. Section 7.5 Telephone Answer Time and Busy Signals. a Under Normal Operating Conditions, telephone answer time by a customer representative, including wait time, must not exceed thirty (30) seconds when the connection is made. If the call needs to be transferred, transfer time must not exceed thirty (30) seconds. b These standards must be met no less than ninety (90) percent of the time under Normal Operating Conditions, measured on a quarterly basis. Under Normal Operating Conditions, the customer must receive a busy signal less than three (3) percent of the time. Section 7.6 Installation, Outage and Service Calls. Under Normal Operating Conditions each of the following standards will be met no less than ninety five (95) percent of the time measured on a quarterly basis: a Excluding conditions beyond the reasonable control of a Grantee which prevent performance, Grantees will begin working on service interruptions promptly, and in no event later than twenty-four (24) hours after the interruption becomes known, and Grantees must begin actions to correct other service problems the next business day after notification of the service problem and resolve such problems as soon as is reasonably possible; b The "appointment window" alternatives for Installations, service calls, and other Installation activities will be either a specific time or, at maximum, a four-hour time block during Normal Business Hours. Grantees may schedule service calls and other installation activities outside of Normal Business Hours for the convenience of the customer; c A Grantee may not cancel an appointment with a customer after the close of business on the business day prior to the scheduled appointment; d If a representative of a Grantee is running late for an appointment with a customer and will not be able to keep the appointment as scheduled, the customer will be contacted. The appointment will be rescheduled, as necessary, at a time during Normal Business Hours which is convenient for the customer. Section 7.7 Complaint and Other Service Records. a Upon written request by the City, and subject to a Grantee's obligation to maintain the privacy of certain information, Grantees must prepare and maintain written records of all complaints received and the resolution of such complaints, including the date of such resolution. b Written complaint records must be on file at the office of a Grantee. Upon written request by the City, Grantees must provide the City with a written summary of such complaints and their resolution on a quarterly basis and in a form mutually agreeable to the City and Grantee. c Upon written request by the City, Grantees must provide detailed compliance reports on a quarterly basis with respect to the objectively measurable service standards required in this Section. A Grantee will not be required to acquire equipment or perform surveys to measure compliance with the telephone answering standards contained in this Section unless a historical record of complaints indicates a failure to comply. Section 7.8 Subscriber Contracts. Grantees must provide to the City upon request any standard form Subscriber contract utilized. If no such written contract exists, Grantee must provide a document completely and concisely stating the length and terms of the Subscriber contract offered to customers. Section 7.9 Video Programming. All Franchises will identify the initial video channels to be provided by a Grantee. To the extent required by 47 U.S.C. § 544(b), prior City approval is required for any change in the broad categories of video programming provided. Individual programming decisions may be made in the discretion of a Grantee. Section 7.10 Billing and Subscriber Communications. a A Grantee must give the City and Subscribers thirty (30) days advance written notice of any changes in rates, programming services, or channel alignments. b Bills must be clear, concise, and understandable. Bills must clearly delineate all activity during the billing period, including optional charges, rebates, and credits. In case of a billing dispute, the Grantee must respond to a written complaint from a Subscriber within 30 days. Section 7.11 Refunds and Credits. a If a Grantee's Cable Service is interrupted or discontinued for 24 or more consecutive hours, its Subscribers must be credited pro rata for such interruption. Credits must be issued no later than the Subscriber's next billing cycle following the determination that a credit is warranted. b In the event a Subscriber establishes or terminates Cable Service and receives less than a full month's Cable Service, the Grantee must prorate the monthly rate on the basis of the number of days in the period for which Cable Service was rendered to the number of days in the billing. Refund checks will be issued promptly, but no later than the return of the equipment supplied by the Grantee if Cable Service is terminated. Section 7.12 Local Office/Drop Box. Grantees must maintain a local office or a local drop box for receiving Subscriber payments. Section 7.13 Additional Customer Service Requirements. The City may adopt additional or modified customer service requirements to address subscriber concerns or complaints. Such requirements must be consistent with applicable laws. SECTION 8. COMMUNITY SERVICES Section 8.1 PEG Access Facilities. Franchises will establish obligations to provide PEG Access Facilities to meet the community's needs and interests. Section 8.2 Service to Public or Educational Institutions. Franchises will establish obligations for the provision of free or reduced cost services to identified public or educational institutions. SECTION 9. ADMINISTRATION PROVISIONS Section 9.1 Administration of Franchise. a The City Administrator will have continuing regulatory supervision over Systems, Cable Services, and Franchise compliance; provided, however, the City Council shall have the sole authority to hold hearings and take final enforcement action as provided in Section 14.1c -d or revoke a Franchise as provided in Section 14.2. b The City Administrator may delegate this regulatory supervision by giving written notice of such delegation to affected Grantees. Grantees must cooperate with any such delegatee of the City Administrator. Section 9.2 Fee. a A Grantee must pay to the City a Fee in the amount established in the Franchise Agreement. b Fee payments are payable quarterly. Fee payments must be made within sixty (60) days of the end of each calendar quarter. c Each Fee payment must be accompanied by a report certified by an officer of the Grantee, in form reasonably acceptable to City, detailing the computation of the payment. All amounts paid must be subject to audit and recomputation by the City and acceptance of any payment must not be construed as an accord that the amount paid is in fact the correct amount. d A Grantee may designate that portion of a Subscriber's bill attributable to the Fee as a separate line item on the -bill. Section 9.3 Access to Records. a The City may, upon reasonable notice and during Normal Business Hours, and subject to the privacy provisions of 47 U.S.C. § 521 et seq., inspect any records maintained by a Grantee which relate to its Franchise or System operations, including specifically Grantee's records relating to Gross Revenues. Grantees must make copies of documents upon City's reasonable request but may identify and label any such documents as "confidential trade secret" in accordance with Section 4.2 above. b Grantees must prepare and furnish to the City such reports with respect to the operations, affairs, transactions or property, as they relate to this Franchise or Cable Services as City may reasonably request. SECTION 10.INDEMNIFICATION AND INSURANCE Section 10.1 Indemnification of the City. a A Grantee must indemnify, defend and hold harmless the City, its officers, boards, committees, commissions, elected officials, employees and agents (an "Indemnified Party") from and against any loss or damage to any real or personal property of any Person, or for any injury to or death of any Person, arising out of or in connection with the construction, operation, maintenance, repair or removal of, or other action or event with respect to a System or other facilities used by a Grantee to deliver Cable Service. b A Grantee must indemnify, defend, and hold harmless an Indemnified Party from and against all lawsuits, claims, actions, liability, damages, costs, expenses or penalties incurred as a result of the award or enforcement of a Franchise. c A Grantee shall not be required to provide indemnification or defense for any intentional misconduct, willful neglect or negligence by -an Indemnified Party, for any enforcement action taken by an Indemnified Party against a Grantee, or for any claim based solely on the City's operation of PEG Access Facilities, delivery of PEG Access programming, or EAS messages originated by the City. d With respect to each claim for indemnification: 1 the Indemnified Party must promptly notify the Grantee in writing of any suit, claim or proceeding which gives rise to such right; 2 the Grantee must afford the Indemnified Party an opportunity to participate in any compromise, settlement or other resolution or disposition of any suit, claim or proceeding; and 3 the Indemnified Party must cooperate with reasonable requests of the Grantee, at Grantee's expense, in its participation in a suit, claim or proceeding. e Subject to the limitations in Minnesota Statutes Chapter 466, the City shall indemnify, defend and hold a Grantee harmless for any damage resulting from any intentional misconduct, willful neglect or negligence by an Indemnified Party in utilizing any PEG Access Facilities or PEG Channels, or in connection with work performed on or adjacent to the System. Section 10.2 Insurance. a A Grantee must obtain and maintain in full force and effect, at its sole expense, a comprehensive general liability insurance policy, in protection of the Grantee, and the City, its officers, elected officials, boards, commissions, agents and employees for damages which may arise as a result of operation of the System or delivery of Cable Service. b The policies of insurance must be in the sum of not less than One Million Dollars ($1,000,000.00) for personal injury or death of any one Person, and Two Million Dollars ($2,000,000.00) for personal injury or death of two or more Persons in any one occurrence, Five Hundred Thousand Dollars ($500,000.00) for property damage to any one person and Two Million Dollars ($2,000,000.00) for property damage resulting from any one act or occurrence. c The insurance policy must be maintained by Grantee in full force and effect during the entire term of the Franchise. Each certificate of insurance must contain a statement on its face that the insurer will not cancel the policy or fail to renew the policy, whether for nonpayment of premium, or otherwise, and whether at the request of Grantee or for other reasons, except after thirty (30) days advance written notice have been provided to the City. SECTION 11.FRANCHISE TRANSFER OR ABANDONMENT. Section 11.1 Abandonment of Service. A Grantee may not discontinue the provision of Cable Service without having first given three (3) months written notice to the City. Section 11.2 System Removal After Abandonment, Termination or Forfeiture. a In the event of termination or forfeiture of the Franchise or abandonment of the System, the City may require the Grantee to remove all or any portion of its System from all Rights -of -Way and public property within the City; provided, however, that the Grantee will not be required to remove its System to the extent it is authorized to provide Telecommunications Services or non -Cable Services over the System. b If the Grantee has failed to commence removal of its System, or such part thereof as was designated by the City, within one hundred twenty (120) days after written demand for removal is given, or if the Grantee has failed to complete such removal within twelve (12) months after written demand for removal is given, the City may apply funds secured by the Franchise toward removal and/or declare all right, title, and interest in the System to be in the City with all rights of ownership including, but not limited to, the right to operate the System or transfer the System to another for operation by it pursuant to the provisions of 47 U.S.C. § 547. Section 11.3 Sale or Transfer of Franchise. a No sale or transfer of ownership of a Grantee or "fundamental corporate change" in a Grantee as defined in Minn. Stat. 238.083, nor sale of transfer of a Franchise, is permitted without City approval. Any sale or transfer of stock in a Grantee creating a new controlling interest constitutes a sale or transfer of ownership. A "controlling interest" includes majority stock ownership or a lesser amount sufficient to confer actual working control in whatever manner exercised. City approval is not be required where a Grantee grants a security interest in its Franchise or System to secure an indebtedness. b A Grantee must file a written request with the City prior to any transaction described above. The City will approve or deny a transfer request within one hundred and twenty (120) days of receipt of a written request. The City will not unreasonably withhold, delay or condition its approval. c In no event will a transaction be approved under Section 11.3(a) unless the transferee becomes a signatory to, and assumes all rights and obligations under, the Franchise. d In the event of any proposed transaction described above, the City will have the right to purchase the System. In the event a Grantee has received a bona fide offer for purchase of its System, the City shall have the right to purchase for the price which the proposed assignee or transferee agreed to pay. The City will be deemed to have waived its right to purchase the System in the following circumstances: 1 The City does not notify the Grantee in writing, within 90 days of notice, that it accepts all material terms and conditions of the purchase of the System; or 2 The City approves the transaction. SECTION 12.PROTECTION OF INDIVIDUAL RIGHTS Section 12.1 Discriminatory Practices Prohibited. No Grantee may deny Cable Service or otherwise discriminate against citizens or businesses on the basis of race, color, religion, national origin, sex, age, status as to public assistance, affectional preference, or disability. Section 12.2 Subscriber Privacy. a Grantees must comply with the subscriber privacy -related requirements of 47 U.S.C. § 551. b No signals of a Class IV Channel may be transmitted from a Subscriber terminal for purposes of monitoring individual viewing patterns or practices without the express written authorization of the Subscriber. c No lists of the names and addresses of Subscribers or any lists that identify the viewing habits of Subscribers may be sold or otherwise made available to any party other than to Grantee and its employees for internal business use, and also to the Subscriber subject of that information, without the express written authorization of the Subscriber. d Written Subscriber authorization is limited to a period not to exceed one (1) year. Subscriber authorization may be renewed at the option of the Subscriber. No penalty may be invoked for a Subscriber's failure to provide or renew such authorization. The authorization must be revocable at any time by the Subscriber without penalty of any kind whatsoever. e Written authorization from a Subscriber is not be required for conducting System -wide or individually addressed electronic sweeps to verify System integrity or monitor for billing purposes. This information must be kept confidential subject to the provision set forth in Subparagraph (b) of this Section. SECTION 13.UNAUTHORIZED CONNECTIONS AND MODIFICATIONS Section 13.1 Unauthorized Connections or Modifications Prohibited. a It is unlawful for any Person, without the express consent of the Grantee, to make or possess, or assist anybody in making or possessing, any connection, extension, or division, whether physically, acoustically, inductively, electronically or otherwise, with or to any segment of a Grantee's System or receive Cable Service from a Grantee's System without a Grantee's authorization. b It is unlawful for any Person to willfully interfere, tamper, remove, obstruct, or damage, or assist thereof, any part or segment of a System for any purpose whatsoever. c Any Person found guilty of violating this section may be fined not less than One Hundred Dollars ($100.00) and the costs of the action nor more than Five Hundred Dollars ($500.00) and the costs of the action for each and every subsequent offense. SECTION 14.ENFORCEMENT OF THE CABLE ORDINANCE OR FRANCHISE Section 14.1 Violations or Other Occurrences Giving Rise to Enforcement Action. a In order to take enforcement action pursuant to this Cable Ordinance or a Franchise, the City must provide the Grantee with written notice of the violation or other occurrence giving rise to the City's action. b The Grantee shall have thirty (30) days subsequent to receipt of the notice to cure the violation or occurrence giving rise to the City's action. Alternatively, the Grantee may, within fourteen (14) days of receipt of notice from the City, notify City in writing that there is a dispute as to whether a violation or failure has in fact occurred. Such written notice by the Grantee to the City shall specify with particularity the matters disputed by Grantee. c In the event a Grantee does not timely cure to the City's reasonable satisfaction the violation or other occurrence giving rise to the City's action, or timely disputes whether a violation has occurred, the City will schedule a public hearing affording Grantee due process. The City will endeavor to schedule the hearing for a date within ninety (90) days of the initial violation notice. Notice of the hearing must be provided to the Grantee. d At the completion of the hearing, the City will issue written findings of fact and its final determination. A Grantee may not initiate legal proceedings until the City's final determination is issued. e In the event City determines that no violation has taken place, the City will rescind the notice of violation in writing. Section 14.2 Franchise Revocation. a In addition to all other rights and remedies that the City possesses pursuant to applicable law, equity and the terms of the Franchise Agreement, the City may revoke or terminate the Franchise, and all rights and privileges pertaining thereto, in accordance with the procedures set forth in Section 14. 1, if the City determines that: I The Grantee has violated any material requirement or provision of the Cable Ordinance or a Franchise and has failed to timely cure; or 2 The Grantee has attempted to evade any of the material provisions of the Cable Ordinance or a Franchise; or 3 The Grantee has practiced fraud or deceit upon the City; or 4 The Grantee has filed for bankruptcy. a During any revocation proceeding, including any appeal period, the Franchise will remain in full force and effect unless the term thereof sooner expires. Section 14.3 Compliance with Federal, State and Local Laws. The City and Grantee will conform to state laws and rules regarding Cable Service or the System not later than one year after they become effective, unless otherwise stated, and conform to federal laws and regulations regarding Cable Service or the System as they become effective. PASSED by the Otsego City Council this 14th Day of October 2002. Y OF OTSEGO ry urnier, Mayor 31