Chapter 4.16
COMPENSATION

Sections:

4.16.010    Franchise Fee Payments to City.

4.16.020    Initial Construction Charges.

4.16.030    Incorrect Payments.

4.16.040    Proration of Payments.

4.16.050    Additional Charge for Late Payment.

4.16.060    Recordkeeping Requirements—Examination Authorized When.

4.16.010 Franchise Fee Payments to City.

A.    As consideration for the franchise granted, franchisee shall pay to the Revenue Collector in lawful money of the United States, during the life of the franchise, for each and every year, including the year of granting the franchise, according to the “franchise payment period”, five percent of its gross revenues derived from the authorized franchise service area(s).

B.    Said franchise fee shall be computed as follows:

1.    Franchisee shall pay a minimum monthly fee as provided in the ordinance granting the franchise;

2.    Annually the franchisee shall pay the percentage fee of five percent of its gross revenues less the total minimum monthly fee(s) paid during the franchise payment period.

C.    Franchisee shall make the monthly fee required herein payable on the first day of each month during the life of the franchise. Franchisee shall make the annual percentage payment concurrently with the filing of the reports required by Section 4.12.180.

D.    Commencing January 1st after the first full calendar year of operational service to subscribers, the amount of the minimum monthly fee shall be subject to an annual readjustment on each January 1st for the remainder of the term of the franchise. Franchisee shall recalculate the monthly fee amount to provide that said monthly fee amount shall be in an amount no less than 90 percent of the total franchise fee payment due to the City for the preceding calendar year, said 90 percent amount to be prorated by 12 to determine the monthly fee amount to be paid during the current year.

E.    Any overpayment of franchise fees paid during the previous annual payment period shall be credited to future franchise fees in succeeding franchise fee payment years, and shall be deducted from the monthly fee amounts or annual percentage amounts as required by the ordinance granting the franchise. At such time as overpayment has been made, franchisee shall notify the City of franchisee’s intention to deduct any said overpayment(s) from the current monthly fee amount(s) due and indicate the scheduling of any such deduction(s).

F.    In addition to the foregoing, the City reserves the right to change its fees if after a public hearing it determines good cause is found and such action is not in conflict with federal laws, FCC rules and regulations or the laws of the State of California. (Ord. 89-28, 1/23/90)

4.16.020 Initial Construction Charges.

In addition to the foregoing franchise fee payments, the franchisee shall pay the Revenue Collector, within 60 days after the end of each calendar year, during the life of the franchise, an initial construction charge for all new construction during said calendar year, calculated at a rate of $100.00 per mile or fraction thereof for all lines and cables laid during the preceding franchise payment period within the authorized franchise service area. (Ord. 89-28, 1/23/90)

4.16.030 Incorrect Payments.

In the event any amount paid is incorrect in the judgment of the Revenue Collector, it may order the payment of such additional sum or sums as it may deem necessary. (Ord. 89-28, 1/23/90)

4.16.040 Proration of Payments.

In the event of abandonment of facilities with the approval of the City or in the event of removal of such facilities by the franchisee, the payments otherwise due the City for occupancy of the roads or highways by such facilities shall be prorated for the calendar year in which such removal or abandonment occurs as of the end of the calendar month in which removed or abandoned. (Ord. 89-28, 1/23/90)

4.16.050 Additional Charge for Late Payment.

In the event franchisee fails to make any payments for the franchise on or before the dates due as herein above provided, franchisee shall pay as additional consideration the following amount: a sum of money equal to 10 percent of the amount due. For each period of late payment of any fee extending beyond 30 days of the due date, in addition to the 10 percent late payment charge, an assessment of interest shall accrue at ten (10) percent per month. The added charge(s) for late payment shall be added to, and be due and payable with, the next succeeding payment. The City shall not be obligated to notify the franchisee of the accumulation of late payment charges. (Ord. 89-28, 1/23/90)

4.16.060 Recordkeeping Requirements—Examination Authorized When.

A.    Franchisee shall keep and preserve, for a period of five years after the date of each franchise payment period, all records necessary to determine the amount of such franchise fees or other payments due under Sections 4.16.010 and 4.16.020. Franchisee, upon demand by City, shall make such records available for inspection and audit by City or its authorized representative, within the City.

B.    At all reasonable times, the franchisee shall permit City, or its duly authorized representative, to examine all property of the franchisee erected, constructed, laid, operated or maintained pursuant to the franchise, together with any appurtenant property of the franchisee, and to examine, audit, and transcribe any and all books, accounts, papers, maps and other records kept or maintained by the franchisee or under its control which relate to the operations, affairs, transactions, property or financial condition of the franchisee with respect to the franchise. (Ord. 89-28, 1/23/90)