27.370 Effect of Termination – Continuity of Service.

(1) When Terminated. A franchisee’s franchise terminates as provided in this chapter or the franchise agreement.

(2) Removal of System upon Termination. Within 12 months of the termination of a franchise, the franchisee shall remove its cable system from all streets and property occupied pursuant to its franchise, unless the City notifies the franchisee that it intends to exercise its purchase option under subsection (6) of this section. At the option of the City, any portions of the cable system that are not removed within that 12-month period shall become the property of the City. Franchisee shall not abandon its cable system or any portion thereof at any time without the City’s prior written consent.

(3) Continuity of Service. It is the right of all subscribers in a franchisee’s franchise area to receive all available services from the franchisee as long as their financial and other obligations to the franchisee are satisfied.

(4) Duty to Assure Continuity of Service. A franchisee shall ensure that all subscribers receive continuous, uninterrupted service in accordance with this section. At the City’s request, a franchisee shall operate its system for a temporary period (the “transition period”) following the termination, sale or transfer of its franchise as necessary to maintain service to subscribers; and shall cooperate with the City to assure an orderly transition from it to another franchisee or cable operator. The transition period shall be no longer than the reasonable period required to select under another franchisee or operator and build a replacement system, if necessary, and shall not be longer than six months, unless extended by the City for good cause. During the transition period, the franchisee will continue to be obligated to comply with the terms and conditions of this agreement and applicable laws and regulations.

(5) Failure to Operate.

(a) Effect of Failure. If a franchisee abandons its system during its franchise term, or fails to operate its system in accordance with this section during any transition period, the City, at its option, may operate the cable system or designate another entity to operate the cable system temporarily until the franchisee restores service under conditions acceptable to the City or until the franchise is revoked and a new franchisee or operator selected by the City is providing service; or obtain an injunction requiring the franchisee to continue operations. If the City is required to operate or designate another entity to operate the cable system, the franchisee shall reimburse the City or its designee for all reasonable costs and damages incurred that are in excess of the revenues from the cable system.

(b) Injunctive Relief Shall Be Granted. The parties agree that the City is entitled to injunctive relief under this section if:

1. A franchisee fails to provide cable service in accordance with its franchise over a substantial portion of the franchise area for 96 consecutive hours, unless the City authorizes a longer interruption of service; or

2. A franchisee, for any period, willfully and without cause refuses to provide cable service in accordance with its franchise over a substantial portion of the franchise area.

(6) Option to Purchase.

(a) When Exercisable. In the event a franchise is canceled, revoked or not renewed, the City shall have the option to purchase the cable system.

(b) How Exercisable. If the City intends to exercise the purchase option, it must so notify the franchisee in writing no later than 60 days after the cancellation, revocation or nonrenewal of the franchise. If the City notifies the franchisee it intends to exercise this option, the parties shall promptly enter into negotiations to establish terms and conditions of the sale consistent with general industry practices, except that the price for the cable system shall be determined in accordance with subsections (6)(c) and (d) of this section.

(c) Purchase Price upon Expiration. In the event of purchase by the City at the end of a franchise term provided for in a franchise agreement, the purchase price shall be the fair market value, determined on the basis of the cable system valued as a going concern, but with no value allocated to the franchise itself.

(d) Purchase Price on Termination for Cause. In the event of purchase by the City upon revocation for cause, cancellation of the franchise or if the franchise is voided, the purchase price shall be an “equitable price” as that term is used in Section 627(b) of the Cable Act, 47 USC 547(b).

[Prior code § 27.37]