HomeMy Public PortalAbout1992_01_28_O003 Additional Cable FranchisesThe Town of
Leesburg,
Virginia
ORDINANCE NO.
AN ORDINANCE:
92-0-3
PRESENTED January 28~ 1992
ADOPTED January 28, 1992
AMENDING CHAPTER 5.1 OF THE TOWN CODE TO ESTABLISH
REGULATIONS AND PROCEDURES FOR THE GRANT OF ADDITIONAL
CABLE TELEVISION FRANCHISES
WHEREAS, in October of 1980 the Town Council of Leesburg, Virginia (the "Town Council")
awarded a non-exclusive 15-year cable television franchise to serve the Town of Leesburg (the "Town")
after full public proceedings affording due process, having approved the legal, character, financial,
technical and other qualifications of the proposed Franchisee and the adequacy and feasibility of the
Franchisee's construction arrangements, consistent with Chapter 5.1 of the Town Code, and after having
determined that the public interest of the Town and its residents would be served by the award of the
Franchise; and
WHEREAS, pursuant to Section 15.1-23.1 of the Code of Virginia, the Town is empowered to
award additional licenses, franchises or certificates of public convenience authorizing the operation of
additional cable televisiou systems upon satisfaction of the standards set forth therein; and
WHEREAS, the Town Council understands that other applicants may come forward with
proposals to provide cable television facilities which duplicate all or a portion of the facilities provided
by the existing Franchisee; and
WHEREAS, it is necessary for the Town Council to adopt standards and procedures to evaluate
any such applications and to assess the effect of additional cable television systems upon the overall
level of cable service in the Town and upon the welfare of the citizens of the Town; and
WHEREAS, it is necessary for the Town Council to further the substantial public purposes of
controlling the use of public rights-of-way, avoiding, whenever possible, the unwarranted disruption
and burdening of public and private property; ensuring maximum availability of cable services;
guaranteeing the availability of channel capacity for use by unaffiliated third parties for both commercial
and noncommercial purposes in a manner consistent with the right of cable operators to exercise their
traditional editorial functions; controlling the economic scarcity of cable services so as to ensure the
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AN ORDINANCE: AMENDING CHAPTER 5.1 OF THE TOWN CODE TO ESTABLISH
REGULATIONS AND PROCEDURES FOR THE GRANT OF ADDITIONAL
CABLE TELEVISION FRANCHISES
continued availability of cable services to the greatest number of residents of the Town at the lowest
prices economically practical; and ensuring the highest quality and best services to the subscribing
public; and
WHEREAS, the adoption by ordinance of the following rules and regulations is necessary in the
general interest of the public and shall promote the public convenience of the citizens of the Town; and
WHEREAS, the Cable Television Advisory Commission on November 18, 1991, unanimously
recommended approval of the ordinance amendment; and
WHEREAS, the Town Council held a public hearing on December 10, 1991.
THEREFORE, ORDAINED by the Council of the Town of Leesburg in Virginia as follows:
SECTION I. Chapter 5.1 of the Town Code is hereby amended to read as follows:
ARTICLE I. IN GENERAL
See. 5.1-1. Short title.
This chapter shall be known and may be cited as the "Cable Television Regulations" of the town.
Sec. 5.1-2. Purpose.
The purpose of this chapter is to provide for regulation and control of any cable television
system operating in the town.
Sec. 5.1-3. Definitions.
Where used within this chapter, unless the context clearly indicates otherwise, the following
words and terms shall have the meaning indicated below:
Applicant means any applicant for a Franchise pursuant to this Chapter.
Cable television system or systems shall mean "_ny
....... ;~1 ~+.~.1;...~.+. l~..+~a ^. +. ..... ; .... · .... u a .... m.g~. any 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, except that such definition shall not include (i) a system that serves
fewer than twenty (20) subscribers, (ii) a facili .ty that serves only to retransmit the television signals
of one or more television broadcast stations, (iii) a facility that serves only subscribers in one or more
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AN ORDINANCE:
AME~ING CHAPTER 5.1 OF THE TOWN CODE TO ESTABLISH
REGULATIONS AND PROCEDURES FOR THE GRANT OF ADDITIONAL
CABLE TELEVISION FRANCHISES
multiple unit dwellings under common ownership, control, or management, unless such facility or
facilities use any public right-of-way. (iv) a facility of a common carrier which is subject" in whole or
in part, to the provisions of Title II of the Communications Act of 1934, 47 U.S.C. { 201 et seq., 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, or (v) any facilities of any electric utility used
solely for operating its electric systems.
Cablecasting shall mean originating programming over a cable television system.
Converter shall mean an electronic device, which converts signals to a frequency not susceptible
to interference within the television receiver of a subscriber and, by an appropriate channel selector,
also permits a subscriber to view all signals delivered at designated dial locations.
Earth station shall mean the electronic equipment and hardware necessary to receive signals
from satellites.
FCC shall mean the Federal Communications Commission or its successor.
Franchise shall mean an authorization granted pursuant to this chapter and applicable state
law in terms of a privilege, permit and license to construct, operate and maintain a cable television
system within the town. Any such authorization, in whatever form granted, shall not include any license
or permit required for the privilege of transacting and carrying on a business within the town as
required by other ordinances and laws of the town.
Franchise territory shall mean all the area within the corporate limits of the town and any
future extension thereof by annexation.
Franchisee shall mean the person, firm or corporation granted a franchise by the town under
the provisions of this chapter and the lawful successor, transferee or assignee of said person, firm or
corporation.
Local origination channel shall mean a channel which is programmed by the cable system and
subject to its exclusive control.
Monitoring shall mean observing a one-way communications signal, or the absence of a signal,
whether the signal is observed by visual or electronic means for any purpose whatsoever.
Pay television shall mean the delivery over the cable television system of video signals to
subscribers for a fee or charge, over and above the charge for basic service, on a per program, per
channel or other subscription basis.
Property of franchisee shall mean all property owned, installed or used within the town by a
franchisee in the conduct of a cable television system business under the authority of a franchise
granted pursuant to this chapter.
Signals, whether distant, local radio, television or kinds of channels such as class I, II, III and
IV, shall be given the meanings found in applicable FCC rules and regulations.
Subscriber shall mean any person or entity receiving for any purpose any service of the cable
television system including, but not limited to, the conventional cable television system service or
retransmission of television broadcast, radio signals, the franchisee's original cablecasting and the local
government, education and public access channels and other services including, but not limited to,
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AN ORDINANCE: AMENDING CHAPTER 5.1 OF THE TOWN CODE TO ESTABLISH
REGULATIONS AND PROCEDURES FOR THE GRANT OF ADDITIONAL
CABLE TELEVISION FRANCHISES
leasing of channels, data and facsimile transmission, pay television and police, fire and similar public
service communication.
Town -mn~rer shall mean the manager of the town or an official authorized by him to
administer the terms, provisions and regulations of this chapter.
ARTICLE II. GRANT; TERM; NONEXCLUSIVITY OF FRANCHISE
Sec. 5.1-4. Franchise necessary to operate.
It shall be unlawful to commence or engage in the construction, operation or maintenance of
a cable television system without a Franchise issued by the Town. Any person violating this Section
shall be punished by a fine of not more than five hundred dollars ($500.00) per day or by imprisonment
for not more than twelve (12) months, or both. This section shall not be deemed to require the grant
of a Franchise to any particular person or entity or to prohibit the Town from restricting the number
of Franchisees should it determine such a restriction would be in the public interest.
Sec. 5.1-5. Length of franchise.
The initial term of any franchise granted under this chapter shall be for a period of no longer
than 15 years. An extension of the initial franchise term may be granted in accordance with Section
5.1-1~ 36 of this chapter.
Sec. 5.1-6. Franchise not exclusive.
The right to use and occupy town streets for a cable television system shall not be exclusive
and the town reserves the right to grant a similar use of said streets to any person, company,
corporation or other entity at any time during the initial or subsequent period of any cable franchise.
Sec. 5.1-7. Terms of additional franchise.
Any additional Franchise granted under this Chapter shall not authorize an additional
Franchisee to operate on terms or conditions more favorable or less burdensome to such new Franchisee
than those applied to any existing Franchisee in its Franchise Agreement.
AN ORDINANCE:
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AMENDING CHAPTER 5.1 OF THE TOWN CODE TO ESTABLISH
REGULATIONS AND PROCEDURES FOR THE GRANT OF ADDITIONAL
CABLE TELEVISION FRANCHISES
ARTICLE III. APPLICATION PROCEDURES AND CONTENTS
Sec. 5.1-8. Notification of Existing Franchisee.
In the event an application is filed proposing cable television service to areas already served
in whole or in part by an existing Franchisee, a copy of such application shall be served by the
Applicant, by registered or certified mail, upon that Franchisee. Proof that a copy of the application has
been served upon any current Franchisee shall be provided to the Town. No application for an
overlaooin~ Franchise shall be processed until such proof of service has been furnished to the Town.
Sec. 5.1-0. Application Fee.
(a) Each application for a Franchise under this Chapter shall be accompanied by a filing fee in
the amount of $5,000.00 which shall be payable to the Town of Leesburg, Virginia. All such fees shall
be credited against the general fund of the Town to ensure the Town is reimbursed for all costs
incurred in the application process. Once the Town has been fully reimbursed for all such costs, any
unused application fees shall be refunded to the Ai~plicant(s).
(b) In addition to the fee set forth in paragraph (a) above, each Applicant shall be jointly and
severally obligated to reimburse the Town for its full cost incurred in the application process. Such
costs shall include, without limitation, internal staff and employee time and expenses, and the fees and
expenses of any consultants, experts, accountants, attorneys or other person(s) utilized by the Town to
assist it in its evaluation of the applications or in connection with the application process. Said costs
shall be paid by each Applicant as they are incurred by the Town. An Applicant's failure to make such
reimbursement upon demand of the Town shall be grounds for dismissal of its application.
Sec. 5.1-10. Scope and Contents.
All applications shall be filed in conformance with and subject to the provisions of this Chapter.
This Chapter shall not be construed to prescribe the detail in which the Applicant shall make its
presentation nor in any way to restrict the scope of its presentation. Applicants have a wide latitude
to formulate their proposals in an innovative fashion. Applicants are encouraged to propose a modern,
efficient, cost-effective system which will facilitate quality maintenance practices, deliver a variety of
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AN ORDINANCE: AMENDING CHAPTER 5.1 OF THE TOWN CODE TO ESTABLISH
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CABLE TELEVISION FRANCHISES
marketable services, and provide the flexibility needed to a4iust the chan~ing technoloKy and new
developments in the industry. However, at a minimum, the following matters must be carefully covered
and in such detail that the Town Council can make fully informed judgments concerning the adequacy
of the proposal and the Applicant's legal, character, financial, technical and other qualifications to
construct and operate a cable television system in the Town.
Sec. 5.1-11. Franchise Area.
The Applicant shall submit sufficiently detailed information to allow the Town to determine
whether the size of the requested Franchise is in the public interest~ considering the size of the area
requested relative to the technical, fiscal and legal qualifications of the Applicant; the potential for
development in the near future for the area requested; and other considerations.
Sec. 5.1-12. Legal Qualifications.
(a) Identification of Applicant. All applications shall contain the name, address and
telephone number of the Applicant and of the principal or the representative to whom inquiries should
be made.
(b) Ownership Information.
(1) The application shall identify its officers and directors and all persons or other
entities having any ownership interest whatsoever in the Applicant~ voting or non-voting (e.g.,
general and limited partners, voting and non-voting shareholders), legal, benefieiAl~ or equitable,
direct or indirect. For each such person or entit~ identified, the application shall provide
complete information as to their names~ addresses, and amount and .type of interest~ and if An
entity, the same ownership information required of the ApplicAnt.
(2) For each person and entity listed in paragraph (1) above~ the applic~__tion shall
provide the following information:
(A) Whether their ownership or holding was acquired at the same per-share-
cost as other owners, and whether services or other in-kind contributions were included
as a basis for acquiring their ownership.
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R~GULATIONS AND PROCEDURES FOR THE GPU~qT OF ADDITIONAL
CABLE TELEVISION F19~dqCHISES
CB) All of their ownership interests in other communications media, including
cable television operators, whether franchised or unfranchised Ce.g, SMATV), television
stations, radio stations, newspapers, and telephone services, and whether such media
serve or have significant circulation in the Town.
CC} Vffhether they are local investors Cinvestors whose permanent residence is
in or around the Town), and if so what role they will have in the decisionCs) of
Applicant relative to operational and programming policies and procedures.
CD) Vghether any buy-out agreement exists, whether written or verbal, giving
other stockholders, persons or entities the right to acquire the interest of local or other
equity holders in the future. If so, the Applicant shall submit copies of all such
agreements.
CE) The Applicant shall also submit copies of all partnership, management and
joint venture agreements which involve the participation of local ownership, as herein
defined.
(3) The application shall disclose in detail the extent to which any town employee or town
official would have a "personal interest~ in the applicant, the franchise, or the award of the franchise
to the applicant. For purposes of this section, the term personal interest shall have the ~rne meaning
as set forth in Sec. 2.1-639.2 of the Virginia Code.
C4) The application shall also identi .fy the form under which the Applicant does business and
proof that the Applicant has registered to conduct business in the State of Vir~ni~ and any other
political subdivision where business is or will be conducted.
Cc) Affiliates, Subscribers and Parent Companies.
The application shall provide full identification and ownership details, as in paragraph (b)Cl) above, for
all affiliates, partners, subsidiaries and parent entities of Applicant.
Cd) Management Information. The application shall provide information concerning the
management structure of the Applicant, including all levels of management of multiple system operators
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and the relationship of the proposed cable operator to its affiliates.
Sec. 5.1-13. Character Qualifications.
(a) Litigation and Proceedings. Applicant shall identify fully and supply records applicable
to any involvement of the Applicant, any of its managers, or any person or entity identified pursx~o_nt
to Sec. 5.1-12(b) or (c) of this Chapter~ as a par~y in any past or pending criminsl proceedinE~ or any
past or pending civil proceeding involving any of the following, litigation involving cable television
operations (franchised or unfranchised e.g., SMATV), unfair or anticompetitive business practices,
antitrust violations (state or federal) including instances in which consent decrees were entered~
violations of securities laws (state or federai), false/misleading advertisin.~ violations of FCC regulations,
racketeer influenced and corrupt organizations~ or contraband forfeitures. The application sh~ll also
supply detailed information concerning whether the Applicant or any such person, entity or rn~_no_~er
has ever been subject to a penai .ty, civil or criminal, for failure to comply with any cable television
franchise~ has ever been involved in any legal action involving any frane, hi.~ing authority, or h_s.~ ever
had any business license of any type (defined to include FCC licenses, alcoholic beverage and restaurant
licenses, etc.) revoked or suspended~ or had renewal denied.
(b) Other Cable System Operations. The application shall provide the following information
as to other cable systems or multichannel video delivery .systems (including SMATV) presently or
formerly owned by or affiliated with the Applicant, any of its managers, or any person or enti .ty
identified pursuant to Sec. 5.1-12(!)) or (c) of this Chapter. With respect to all cable .systems presently
owned and those cable systems disposed of within the preceding five years, the applJe~qnt shg]! provide
information as to the location of the system, miles of plant, percent completed, densi .ty of area serverl~
number of homes passed, number of subscribers, channel capacity, services offered~ rates charged,
market penetration, date franchise awarded, date acquired and date disposed of, and public officials or
employees who may be contacted for information regarding each such system. With respect to formerly
owned cable .systems disposed of earlier than the preceding five years and for all multich~nnel video
delive .ry .systems (including SMATV), the application shall provide information as to the locat/on of the
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AN ORDINANCE: ANfENDING CHAPTER 5.1 OF THE TOWN CODE TO ESTABLISH
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CABLE TELEVISION FRANCHISES
system, number of homes passed, number of subscribers, channel capacity, date constructed or acquired
and date disposed of.
Sec. 5.1-14. Financial Qualifications and Pm) Form~- Financial Statements.
(a) Financial Plan. Each application shall describe in detail the financing plan for the
construction and initial operation of the proposed cable system and provide proof of financial capability.
Each application shall include documentation that demonstrates and assures the Applicant's financi,]
viability, such as letters of commitment from financial institutions which demonstrate the availability
of sufficient funds to complete construction of the proposed system. Proof of financial capability shall
include:
(1) A showing of the sources, method (e.g., cash, cash plus credit~ services, etc.) and
amount of equity capital. If the equity contribution is borrowed, a description of the collateral
and terms of the loan. All equity commitments must be evidenced by appropriate
documentation.
(2) A showing of the sources, amount and terms of debt capital, both prima .ry and
seconda .~, accompanied by appropriate documentation. If funding is to be provided by any
parent or affiliated entity, its source of funding must also be documented.
(3) If Applicant is a multiple system operator, it shall give evidence of the portion of the
company's sources of financing which is uncommitted and will be applied to the proposed
construction.
(b) Pro Forma Financial Statements. Pro forma financial statements shall be required for
a minimum of ten (10) years beginning with the date the franchise is accepted. Such pro formas shall
include income statements, sources and uses of funds, loan amortization information, anticipated capita!
expenditures, construction costs, depreciation schedules, and operating expenses, along with detailed
assumptions on which the projections are based. The information and assumptions shall include
financial aspects of miles of plant to be built and .type of installation (aerial/underground), building
schedule, headends, other capital investments and planned coverage, debt/equity ratio, debt service
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CABLE TELEVISION FRANCHISES
costs, depreciation, operating costs in detail, assumed market penetration rate, expected internal rate
of return, discussion of fixed and variable costs, and such other relevant information as the Town or
its officers, employees, agents or consultants deem appropriate.
(c) If the applicant is an existing entity, it shall submit audited financial statements for the last,
two (2) years or, ff existing for less than two (2) years, for such period of existence. If capital is to be
raised or supplied by a parent company, Applicant shall provide an audited financial statement for the
parent company. Financial statements prepared by a certified public accountant according to generally
accepted accounting standards and in conformity with generally accepted accounting principles (GAAP)
may be submitted in lieu of audited financial statements if the applicant certifies that it h,.~ not
undertaken an audit of its financial statements and operations during the last two years.
Sec. 5.1-15. Technical Qualifications.
The application shall describe any qualifications and cable system experience of Applicant,
including, but not limited to, the ownership, construction, management, and operation of other came
communications systems specifying the manner in which Applicant participated; av_s_i]_s_ble personnel with
technical qualifications and experience committed to the proposed system design, construction and
operation; construction contractors to be used, if any; and technical consultants, if any. The application
shall indicate the .type of participation and the qualifications of persons, consultants, contractors, etc,
whose services will be utilized.
Sec. 5.1-16. System Construction Plan.
The Applicant shall submit to the office of the Town Manager a detailed construction plan,
supported by detailed maps indicating areas of construction and prqiected timeframes in six (6) month
increments. The construction plan shall comply with all requirements set out in Chapter 5.1 and sh~]]
reasonably delineate the portions of the system that will be using aerial cable, the portions of the
system that will be utilizing underground cable and the portions of the system~ if any, that will be using
wireless technology. The Applicant shall demonstrate that sufficient pole and conduit space ~.×i.~ts for
the placement of its facilities and shall provide a copy of any agreement between the Applicant and the
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AN ORDINANCE: AMENDING CHAPTER 5.1 OF THE TOWN CODE TO ESTABLISH
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utility providing for the use of any utility facilities.
Sec. 5.1-17. System Design-Layout and Equipment.
The Applicant shall provide a comprehensive, but concise, description of the proposed system
design. Such description shall include the system configuration, the manufacturer and model of each
.type of equipment used, a spectrum utilization chart, and a complete list of all services, video or
otherwise, which will be offered. The proposed system design shall comply with all requirements set
out in Chapter 5.1.
Sec. 5.1-18. Customer Services.
The Applicant shall set forth detailed plans for system maintenance, customer complaints, billin~
procedures and inquiries, record keeping, subscriber privacy, policies related to outages, and personnel.
Sec. 5.1-19. Impact of an Additional Grantee.
To assist the Town in making its evaluation of the impact of additional Franchisees, the
Applicant shall provide detailed information relating to:
(a) the economic .iustification, if any, for issuing a Franchise to a subsequent Applicant;
Co) the impact of the proposed Franchise on private property rights;
(c) the impact of the proposed Franchise on public convenience;
(d) the public need for such Franchise;
(e) the potential benefit of such Franchise;
(f) the per-strand-mile densities of the areas the Applicant proposes to serve and extent to
which the Applicant intends to utilize bulk contracts~ and
(~) a demonstration that there is sufficient usable space available on each pole to be u~ili~.ed by
Applicant. or in any trenches or conduits where underground facilities are proposed. Costs for
rearrangement of facilities or replacement of poles shall be reasonably detailed.
ARTICLE IV. REVIEW OF APPLICATION
Sec. 5.1-20. Initial Review and Request for AdditionAl Applications.
Upon the submission of an application for a franchise, the Town M~,n_,_.~er ~hA]! review the
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AN ORDINANCE: AMENDING CHAPTER 5.1 OF THE TOWN CODE TO ESTABLISH
REGULATIONS AND PROCEDURES FOR THE GRANT OF ADDITIONAL
CABLE TELEVISION FRANCHISES
application to ensure that all information provided is correct and whether the Applicant has the
financial, technical and managerial background and resources to provide the proposed services. If
necessary, the Town Manager may request an Applicant to provide additional information. If the
application requests a franchise term greater than five years, the Town Manager shall also promptly
notify the Town Clerk to advertise receipt of the application and the advertisement sh,l! also invite the
submission of additional applicants for a Franchise within a period of thirty (30) days. Should additional
application(s) be submitted, they shall be subject to all of the requirements of Chapter 5.1, as Amended,
including the opportunity for public comment provided by Sec. 5.1-22(a). However, no additional
requests for applications shall be required. If additional application(s) are submitted within the
prescribed time period, all of the applications shall be considered together at the public hearing required
by Sec. 5.1-22(a).
Sec. 5.1-21. Completeness of Application.
The Town Manager shall accept, reject as incomplete or deficient, or accept with conditions,
applications. Within sixty. (60) days of receipt of any application, the Town Manager shall noti.fy
Applicant as to any facial deficiencies.
Sec. 5.1-22. Public Hearing.
(a) Upon acceptance of any application or, if accepted with conditions, upon the conditions being
met, the Town Manager shall notify the Town Clerk to advert/se the public hearing at which the Town
Council will consider the application(s). Existing Franchisees and members of the public will be given
an opportuni .ty to submit relevant comments and the advertisement sh~l! provide for at ]~-s~ a thirty
(30) day period for the submission of such material. The public hearing .qh~l! commence after acceptance
of the application by the Town ManageL or if accepted with conditions, after all conditions are met, but
in no event sooner than thirty. (30) days following the date on which written comments are due.
Sec. 5.1-23. Summary Report.
The Town Manager, in consultation with the Cable Television Advisory Commission, shall issue,
or cause to be issued, a report summarizing each application which .~hAl] contain a recommendation
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AN ORDINANCE: AMENDING CHAPTER 5.1 OF THE TOWN CODE TO ESTABLISH
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CABLE TELEVISION FRANCHISES
to the Town Council as to approval, denial, or approval with conditions. The Town Council may obtain
a consultant to perform studies and reviews to assist the Town Manager. In the event an application
is filed proposing a cable service area which overlaps, in whole or in part, an ~.x~.~ng Franchisee's
service area, an independent consultant's report may be obtained to address the factors set forth in
Article V of this Chapter, as amended. The Applicant(s) shall be responsible for any cost thereof as set
forth in Section 5.1-9 herein.
ARTICLE V. CONSIDERATION BY TOWN COUNCIL
Sec. 5.1-24. General Evaluation Criteria.
Evaluation of any franchise proposals will primarily include~ but will not be limited to~ the
following.
(a) Leaml capacity and character.
(1) Whether the Applicant is not precluded from cable system ownership by any FCC
rule or federal or state law.
(2) Whether the Applicant has not been convicted of any felonies or serio~].~
misdemeanors or found liable in certain civil actions as specified in Sec. 5.1-13(a) hereof.
(3) Whether the Applicant has made full disclosure of any campaign contributions which
it has made to any Town official involved in the franchise procedure and of any interest in the
Applicant which may be owned or controlled by such an OffiCiAl
(4) Identification of the persons who will be owning and/or contro]lin~ the proposed
Franchise.
(b) Financial capability.
(1) Whether there is sufficient capital to develop the cable .system.
(2) The reasonableness of the Applicant's financial plan.
(c) Construction design and timing.
(1) The general quality and sophistication of the cable facilities plan
(2) Aoolicant's construction schedule.
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(3) Applicant's description of the service area and whether it plans to provide cable
service to all housing units in the franchise territo .ry.
(d) Scope and quality of cable television service.
(1) Provisions for pay television and satellite delivered programming.
(2) Plans for realistic but community-responsive local origination programming.
(3) Reasonableness of proposed rates and company policies for implementing future rate
increases.
(4) Alternative cable service levels and the time frame for their delivery.
(5) Innovations to enhance high penetration rates.
(6) Innovative application of educational access programming.
(7) Procedures for handling subscriber complaints.
(8) Measures to ensure protection of subscriber privacy.
(e) Pro]ected management and staffing caoacit.v.
(f) Previous cable system operations experience.
(1) Evaluation of cable operations in other comm~mities.
(2) Ability to meet deadlines and provide services on schedule in other comm~mities
Sec. 5.1-25. Evaluation Criteria-Desirability of an Additional Grantee.
In the event an application is filed proposing a Franchise area which overlaps, in whole or in
part, an existing Franchisee's service area, the Town Council, in considering such application, sh~_ll~ in
addition to the factors set forth in Sec. 5.1-17 of this Chapter, take into account'
(a) whether the public welfare will be enhanced by the grant of an additional Franchise;
(b) economic considerations, including the long term viability of multiple Franchisees to ensure
the availability of high-quality cable service and other public benefits to the greatest number of Town
residents at the lowest economically feasible pricel
(c) the impact upon and possible disruption of public and private property, rights by multiple
Franchisees;
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AMENDING CHAPTER 5.1 OF THE TOWN CODE TO ESTABLISH
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(d) the impact on the public convenience, including the ability of the Town Council to regulate
multiple Franchisees;
(e) the public need and potential benefit;
(f) the apolicant's plan for constructing its aerial and underground facilities;
(g) the impact on the financial and operating capability of existing Franchisees;
(h) the loss of uniformity of service as may be provided by a single Franchisee; and
(i) whether access to cable service might be denied to certain potential subscribers based on the
income of residents of a particular area.
Sec. 5.1-26. Additional Information.
The Town may continue or postpone the public hearing as it deems appropriate. It may request
additional information of the Applicant, existing Franchisees or officers and employees of the Town. The
Applicant or existing Franchisees may submit studies, reports or opinions addressing the need for an
additional Franchisee, the economic effect of an additional Franchisee, or other appropriate matters.
Sec. 5.1-27. Action by Town Council.
Upon consideration of all relevant information and completion of the public hearing process, the
Town Council may re. iect the application, or award a Franchise with or without conditions. Any such
award of a Franchise shall require the affirmative vote of a mgiority of all members elected to the Town
Council.
ARTICLE III VI. TRANSFER OR ASSIGNMENT
Sec. 5.1-7 2--8. Certain transfers or assignments prohibited.
No transfer or assignment of a franchise shall be approved or considered by the town council
within two years of the effective date of the initial term of a franchise.
Sec. 5.14 2__~9. Transfer or assignments.
(a) Except as otherwise provided, no franchise granted pursuant to this chapter shall be assigned
or transferred, either in whole or in part, or leased, sublet or mortgaged in any manner, nor shall title
thereto, either legal or equitable, or any right, interest or property therein, pass to or vest in any
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REGULATIONS AND PROCEDURES FOR THE GRANT OF ADDITIONAL
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person, either by the act of the company or by operation of law without the consent of the 'town council,
which consent shall not unreasonably be withheld. The granting, giving or waiving of any one or more
of such consents shall not render unnecessary any subsequent consent or consents.
(b) The town specifically reserves the right, in determining whether or not to authorize a
transfer under this section, to consider the entire price and/or consideration to be paid by any proposed
transferee, including the allocation of value of the franchise as it actually or potentially affects the rates
to subscribers at that time or in the future. The town may also take into account the extent to which
a proposed transfer may potentially cause, require or justify, in whole or in part, a rate increase or
request for rate increase. The town is specifically authorized to deny, restrict or condition its
authorization of any transfer on the grounds mentioned hereinahove or on any related ~'ounds under
which the town may at its sole option determine.
(c) The franchisee may pledge, mortgage, hypothecate or otherwise transfer, as may be required,
an interest in the cable television system to any lender in order to obtain financing for the cable
television system. Such transfer, pledge, mortgage or hypothecation may, if required by the lender,
include the authority to sell the cable television system, subject to consent of the town council, upon
mortgage default by the franchisee. Such approval shall not be unreasonably withheld. In this event,
any such sale approved will require the new owner to comply with all terms and conditions of this
chapter as well as the original franchise agreement and franchise ordinance.
Sec. 5.1-9 30. Sale or transfer of stock or other ownership.
One or more sales or transfers of stock or other ownership, by operation of law or otherwise,
or creation of new stock, by which an aggregate of more than ten percent of franchise stock or other
form of interest shall be vested in a party or parties who are nonstockholders or nonowners as of the
effective date of the franchise, shall be an assignment within the meaning of this article. For the
purpose of this section, stock ownership shall be determined in accordance with the principles set forth
in Section 5.4-4 of the Internal Revenue Code of 1954 as the same existed on August 16, 1954.
AN ORDINANCE:
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AMENDING CHAPTER 5.1 OF THE TOWN CODE TO ESTABLISH
REGULATIONS AND PROCEDURES FOR THE GRANT OF ADDITIONAL
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Sec. 5.1-!9 3_.~1. Notice of transfer or assignment.
A franchisee shall promptly notify the town manager of any proposed change in, or transfer of,
or acquisition by any other party of control of the franchise. For the purpose of determining whether
it shall consent to such change, transfer or acquisition of control, the town may inquire into the
qualifications of the prospective controlling party, and the franchisee shall assist the town in any such
inquiry. A transfer fee in the amount of $500.00 shall be paid to the town by the prospective assignee
or purchaser at the time of application. In the event that the town council adopts a resolution denying
its consent and such change, transfer or acquisition of control has been effected, the town council may
cancel the franchise unless control of the franchise is restored within 30 days to its status prior to the
change or to a status acceptable to the town council. Any mortgage, pledge or lease shall be subject
and subordinate to the rights of the town under this chapter or other applicable law.
ARTICLE 1~ VII. TERMINATION AND RENEWAL
Sec. 5.1-14 3._~2. Revocation.
The town council reserves the right to revoke the franchise, and all rights and privileges
pertaining thereto, in the event the franchisee violates any of the material provisions of this chapter
or is found to have practiced any fraud or deceit upon the town or the public; provided, however, that
complaints by the public shall be considered pursuant to the provisions of section 5.1-44 64 of this
chapter. Prior to any revocation proceedings under this section, the franchisee shall be given 60 days'
notice in writing by certified mail, which notice shall state in detail the grounds upon which the town
seeks revocation. If the material violation has not been remedied to the satisfaction of the town, the
town council shall have the right to revoke said franchise, and all rights, privileges and license derived
therefrom, forthwith by resolution. At the time any franchise has been so revoked, the town council
may require the former franchisee to remove all wires, cables and all other equipment associated with
the cable television franchise at its expense.
Sec. 5.14~ 3--3. Foreclosure.
Upon notice of the prospective foreclosure or other judicial sale of all or a substantial part of
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AN ORDINANCE: AMENDING CHAPTER 5.1 OF THE TOWN CODE TO ESTABLISH
REGULATIONS AND PROCEDURES FOR THE GRANT OF ADDITIONAL
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the system or upon the termination of any lease covering all or a substantial part of the system, the
franchisee shall nolify the town manager of such fact~ and such notification shall be treated as a
notification that a change in control of the franchisee has taken place, and the provisions of Article II
of this chapter shall apply.
Sec. 5.1-44~ 34. Reserved.
Sec. 5.1-14 3_~5. Expiration.
Twelve months preceding the expiration of the initial term of a franchise granted pursuant to
this chapter, the town shall have the right, at its election, to:
(a) Renew or extend the franchise as provided in section 5.1-~ 36;
(b) Invite new applicants for the franchise; or
(c) Purchase the system.
Sec. 5.1-1~ 3__~6. Renewal or extension.
A franchise may be renewed or extended at the sole option of the town for a period of five
years. Renewal consideration shall include but not be limited to the reports prepared throughout the
life of the franchise reviewing the system's technical performance, the development of cable services,
the cost of said services and a comparison of similar cable systems in other communities. The town
retains the right to modify the terms of a franchise within the then applicable provisions of state law
as a condition of any such renewal or extension.
Sec. 5.1~6 3_~7. Town purchase of system upon revocation or expiration.
In the event that the town revokes a franchise pursuant to appropriate provisions of this
chapter, or upon the expiration of a franchise, the town shall have the right to purchase the cable
system at a price not to exceed its then fair market value. The fair market value shall be determined
by a independent accounting firm, selected by the franchisee and the town, in accordance ~dth generally
accepted appraisal and accounting principles, except that any value attributable to the actual franchise
right itseff or to good will of the cable system shall be specifically excluded. The cost of such appraisal
shall be shared equally by the franchisee and the town.
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AN ORDINANCE: AMENDING CHAPTER 5.1 OF THE TOWN CODE TO ESTABLISH
REGULATIONS AND PROCEDURES FOR THE GRANT OF ADDITIONAL
CABLE TELEVISION FRANCHISES
Sec. 5.1--1-7 3__~8. Continuity of service mandatory.
A franchisee shall be required to provide continuous service to all subscribers in return for
payment of the established fee. If a franchisee overbuilds, rebuilds, modifies, sells the system or the
town revokes, fails to renew a franchise or the franchise becomes void, a franchisee is required as part
of its franchise to continue to operate the system until an orderly and lawful change of operation is
effectuated. Under no circumstances shall this period of operation exceed six months from the date of
occurrence of any of the above events. In the event a franchisee falls to operate the system for five
consecutive days without prior approval of the town manager or the franchisee falls to continue
operation on the occurrence of any of the events given in this section, the town or its agent shall have
the right to operate the system until such time that a new operator is selected. If the town is required
to fulfill this obligation for the franchisee, the franchisee shall reimburse the town for any costs or
damages that result from the franchisee's failure to operate the system as required.
Sec. 5.1~1~ 3_~9. Eminent domain.
Nothing herein shall be deemed or construed to impair or affect~ in any way or to any extent~
the right of the town to acquire the property of the franchisee through the exercise of the right of
eminent domain and nothing herein contained shall be construed to contract away or to modify or
abridge, either for a term or in perpetuity, the town's right of eminent domain with respect to any
public utility or franchise.
ARTICLE ~ VIII. FRANCHISE TERRITORY; CONSTRUCTION
TIMETABLE; EXTENSION OF SERVICE
Sec. 5.1~19 4(I. Franchise territory.
(a) The franchisee shall construct and operate at a minimum the initial cable television system
so as to provide service through all parts of the franchise territory having a density of at least 60
residential dwelling units per mile of plant or at the density submitted in the franchisee's cable
television application, whichever is lower. The initial cable television system will be considered as all
of the system included on the map submitted with the franchisee's application.
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AN ORDINANCE: AMENDING CHAPTER 5.1 OF THE TOWN CODE TO ESTABLISH
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(b) Extensions to the initial system and any extensions in any annexed areas shall be subject
to the same density standards. At a minimum, the franchisee shall construct one mile of cable plant
per year upon receipt of a notice to proceed from the manager. Notwithstanding the above, the
franchisee shall not be required to commence construction in these areas until the initial cable television
system is constructed.
Sec. 5.1~9~ 41. Construction timetable.
(a) The franchisee shall construct the necessary facilities to permit basic service reception
capability, including construction of 20 percent of the cable distribution plant, within 18 months of the
date of the franchise agreement. Within 90 days of the date of the franchise agreement, the franchisee
shall submit a construction timetable detailing the location and geographic sequence of the construction
of the head-end and distribution plant leading to basic service and special service capability for every
dwelling unit within the town, subject to aforementioned density standards.
(b) V~ithin four years of the date of the franchise agreement, the franchisee shall have
completely installed and have under operation a cable television system providing basic service and
special service capability to all dwelling units within the franchise territory, subject to density limitations
provided herein. Capability shall be defined as the providing of basic services or special services to
subscribers within 60 days of an application for either or both services, including satellite distributed
programs.
(c) Failure on the part of a franchisee to meet any of the requirements of this section shall be
deemed a material violation of this chapter and subject franchisee to revocation procedures established
in section 5.1-16 37 herein, unless said time is extended by the town council. Such extensions may or
may not relieve the franchisee of the payment of penalties set out in section 5.1-49 68 at the sole option
of the town council.
(d) A franchisee shall register with the FCC and comply with all other filing requirements of
federal and sate law within 60 days of its acceptance of the franchise.
AN ORDINANCE:
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AlVIENDING CHAPTER 5.1 OF THE TOWN CODE TO ESTABLISH
REGULATIONS AND PROCEDURES FOR THE GRANT OF ADDITIONAL
CABLE TELEVISION FRANCHISES
Sec. $.1-~ 4J. lnterconnection.
A franchisee may interconnect the system with any or all other cable television systems in the
area if otherwise lawful and provided such other system agrees to the interconnection. Interconnection
of systems may be done by direct cable connection, microwave linl~ satellite or other appropriate
method.
(a) Upon receiving the directive of the town to interconnect, the franchisee shall immediately
initiate negotiations with the other affected cable television system or systems in order that costs may
be shared equally for both construction and operation of the interconnection link.
(b) The town council may grant reasonable extensions of time to interconnect or rescind its
request to interconnect upon petitions by the franchisee to the town council. The town council shall
grant the request if it finds that the franchisee has negotiated in good faith and the cost of
interconnection would cause an unreasonable increase in subscriber rates.
(c) No interconnection shall take place without prior approval of the town manager. A
franchisee, in seeking approval for interconnection, shall demonstrate that all signals to be
interconnected will comply with FCC technical standards for all classes of signals and will result in a
low level of distortion.
(d) The franchisee shall cooperate with any interconnection corporation, regional interconnection
authority, state or federal regulatory agency which may be hereafter established for the purpose of
regulating, facilitation, financing or otherwise providing for the interconnection of cable television
systems beyond the boundaries of the town.
ARTICLE ~I ~DL SERVICES
Sec. 5.1-~ 43. Basic subscriber service.
(a) At the time housedrop connections are available, the franchisee shall provide all subscribers
who request basic service with the minimum television signals established in section 5.1-2~ 49 of this
chapter and one local origination channel designated for public access on a first come, nondiscriminatory
basis. The public access channel will be available to public, educational, governmental and any other
AN ORDINANCE:
users.
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AMENDING CHAPTER 5.1 OF THE TOWN CODE TO ESTABLISH
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(b) The franchisee at its expanse shall furnish upon request one connection for each public
school, county and municipal (town) office which is within the franchise territory and not more than
250 feet from the franchisee's existing service facilities.
Sec. 5.1-~q 44. Special services.
At such time as subscriber service is first available, the franchisee, in addition to basic service,
shall offer special services available at higher rates, which shall include one or more channels offering
pay TV and additional commercial satellite delivered channels.
Sec. 5.1-V,4 45. Virginia Public Telecommunications Council.
A franchisee shall also comply with all current and future requirements of the Virginia Public
Telecommunications Council.
Sec. 5.1-~ 4_fi6. Reserved.
Sec. 5.1-26 4_~7. Local origination programming.
Within 24 months from the date of a franchise agreement, a franchisee shall provide at its
expense facilities and equipment necessary to originate local programming, providing one local
origination channel for that purpose, m~.. ~...~; .... · ~ ..1~1~ /-^l~,,;~nt, ~,~.~.. ¥,,4.'th n ...in;. ....... Of
council. Upon obtaining a minimum of ],000 subscribers, a Franchisee shah cablecast a minimum of
t~o hours of non-automated, locally produced proRT~mmin~ within each 24-hour period. Upon obtaininF.
a minimum of 1,500 subscribers, a Franchisee shah cablecast a minimum of three hours of non-
automated, locally produced proRTamming within each 24-hour period. Upon obt~inln~ a minim,m of
3,000 subscribers, a Franchisee shall cablecast a minim,,m of four hours of non-automated, locally
produced programming during each 24-hour period_
Sec. 5.1-~7 4_~8. Studio facilities.
A franchisee shall provide a full color studio located within a five-mile radius of the town. The
AN ORDINANCE:
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AMENDING CHAPTER 5.1 OF THE TOWN CODE TO ESTABLISH
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studio win be available to access cablecasters along with the services of technical and production staff
to be provided by the franchisee. A franchisee shall also provide mobile color equipment for its own use
and that of local access users. The franchisee may lease a studio and facilities from others to comply
with this section. Franchise applicants will be evaluated on the basis of plans and rate schedules for
production facilities which are most in the public interest. Rate schedules may include different rates
for various classes of users.
ARTICLE ,.,.! _X. DESIGN AND CONSTRUCTION
STANDARDS
Sec. 5.1-2S 4__~9. Channel capacity.
A franchisee shall construct a cable television system that shall have not less than 24 video
channels or an equivalent amount of band width capacity, including any local origination franchise-
operated station which may also serve as the public access channel required by section 5.1-Z2 43 of this
chapter.
Sec. 5.1-~9 5_Q0. Overhead and underground construction.
Construction of trunk, feeder and drop cable may be constructed overhead where utility poles
now exist and electric or telephone lines or both are now overhead but, where no overhead poles exist,
all trunk, feeder and drop cable shall be constructed underground. Any installation above ground shall
be considered as a special exception to section 13-39 of the town cede. Where present overhead utility
poles, electric lines and telephone lines are moved from overhead to underground placement, all cable
television distribution system cables located above ground within the affected area shall be similarly
moved and located underground at the same time and the cost of the movement of the cable shall be
solely the obligation of the franchisee.
Sec. 5.1-30 5_~1. Two-way capacity.
The franchisee shall install a cable television system with a technical capacity for nonvoice
return communications. The franchisee's development of class IV uses shall coincide with the schedule
submitted in the franchise application.
AN ORDINANCE:
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AMENDING CHAPTER 5.1 OF THE TOWN CODE TO ESTABLISH
REGULATIONS AND PROCEDURES FOR THE GRANT OF ADDITIONAL
CABLE TELEVISION FRANCHISES
Sec. 5.1-_~1 5_~2. Emergency requirements.
The franchisee shall design and construct the cable television system to provide for an audio
override of all channels simultaneously, except those involved in retransmission of television broadcast
programming, in case of public emergencies.
Sec. 5.1~ 5_~3. Construction requirements and safety standards.
(a) Methods of construction, installation and maintenance of the town's cable television system
shall comply with the National Electric Code 1975 (ANSI CI-1975) to the extent that such code is
consistent with local law affecting the construction, installation and maintenance of electr/c supply and
communications lines.
(b) Any tower constructed for use in the cable television system shall comply with the standards
contained in Structural Standards for Steel Antenna Towers and Antenna Supporting Structures, EIA
Standards P~-222-A, as published by the Engineering Department of the Electronic Industries
Association, 2001 Eye Street, N.W., Washington, D.C. 20006.
(c) Installation and physical dimensions of any tower construction for use in any cable television
system shall comply with all appropriate Federal Aviation Agency regulations.
Sec. 5.1-34 54. Construction, supervision and alteration after construction.
(a) A franchisee shall construct, operate and maintain the cable television system subject to the
supervision of the town and in strict compliance with all laws, ordinances, rules and regulations
affecting the system.
(b) The cable television system, and all parts thereof, shall be subject to periodic inspection by
the town.
(c) No construction, reconstruction or relocation of the cable television system, or any parts
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AN ORDINANCE: AMENDING CHAPTER 5.1 OF THE TOWN CODE TO ESTABLISH
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CABLE TELEVISION FRANCHISES
thereof, within the streets shall commence until written permits have been obtained from the town. In
any permit so issued, the town director of engineering or other officials authorized by the town manager
may impose such conditions and regulations as a condition of the granting of the same as are necessary
for the purpose of protecting any structures in the streets and for the proper restoration of such streets
and structures and for the protection of the public and continuity of pedestrian and vehicular traffic.
(d) The town council may, from time to time, issue such reasonable rules and regulations
concerning the construction, operation and maintenance of the cable television system as are consistent
with the provisions of this chapter and the franchise issued pursuant to this chapter.
(e) The town council may require that any part or an of the cable television system should be
improved or upgraded by the franchisee within a reasonable time thereafter, including, without
limitation, the increasing of channel capacity, the furnishing of improved equipment and the institution
of two-way transmission; provided such improvement or upgrading of the system is found to be
economically feasible. For the purpose of this subsection, a "finding of economic feasibility" shall mean
a finding that the capital costs to the franchisee of such improvement or upgrading can reasonably be
amortized over the then remaining life of the franchise without substantially affecting the franchisee's
rate of return or other measure of profitability agreed to by franchisee and the town.
Sec. 5.1-3~ 5_~5. Use of public property.
(a) Should the grades or lines of the streets which the franchisee is hereby authorized to use
and occupy be changed at any time during the term of the franchise, the franchisee shall, if necessary,
at its own cost and expense, relocate or change its system so as to conform with such new grades or
lines.
(b) Any alteration to the water mains, sanitary sewerage or storm drainage system or to any
town, state or other public facilities in the streets required on account of the presence of the cable
television system in the streets shall be made at the sole expense of the franchisee. During any work
on constructing, operating or maintaining of the system, the franchisee shall also, at its own expense,
protect any and all existing structures belonging to the town or any other person. All work performed
AN ORDINANCE: AMENDING CHAPTER 5.1 OF THE TOWN CODE TO ESTABLISH
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CABLE TELEVISION FRANCHISES
by the franchisee pursuant to this section shall be done in the manner prescribed by the town.
Sec. 5.1-~36 5__~6. Interference with public projects.
Nothing in this chapter shall be in the preference or hindrance to the right of the town to
perform any public works or public improvements of any description, and should the system in any
way interfere with the construction, maintenance or repair of such public works or public
improvements, a franchisee shall, at its own cost and expense, protect or relocate its system, or part
thereof, as reasonably directed by the town.
Sec. 5.1~7 5__~7. Technical standards.
The franchisee shall comply with all existing and future requirements of the FCC or its
successor's governing technical standards. The town reserves the right to adopt its own technical
standards when permitted to do so.
ARTICLE ¥!!! XI. MAINTENANCE, OPERATIONS
AND ACCOUNTING RECORDS
Sec. 5.1~8 5_~8. Books and records.
(a) The franchisee shall maintain separate accounting records, in accordance with generally
accepted accounting practices, of all its operations and transactions within the town. The town shall
have the right to inspect during normal business hours, all books, records, maps, plans, financial
statements and other like materials of the franchise which relate to its operation within the town,
including expenses attributed to the franchisee by any parent corporation. All such information received
by the town shall remain confidential insofar as permitted by the Virginia Freedom of Information Act,
as now or hereinafter amended. The requirements of this section shall be considered a material
provision of this chapter.
(b) The franchisee shall maintain a file of records open to public inspection in accordance with
applicable FCC rules and regulations or, if none exist, in accordance with rules and regulations adopted
by the town council.
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AN ORDINANCE: AMENDING CHAPTER 5.1 OF THE TOWN CODE TO ESTABLISH
REGULATIONS AND PROCEDURES FOR THE GRANT OF ADDITIONAL
CABLE TELEVISION FRANCHISES
Sec. 5.1-39 5J. Reports.
(a) Annua/report. Within 90 days of the close of its fiscal year, the franchisee shall submit a
written report to the town council, which shall include:
(1) A summary of the previous year's activities and development of the cable television system,
including but not limited to services begun or dropped and subscribers gained or lost;
(2) A summary of complaints, identifying both number and nature of the complaints received
and an explanation of the disposition;
(3) A financial statement including balance sheet, statement of income and expenditures, and
statement of changes in financial position, which the town manager may require to be an audited
statement by giving notice to the franchisee 60 days prior to the deadline for submittal of the written
report;
(4) A projected financial statement including all of the above information, along with a capital
program and projected new services for the next two years;
(5) A reconciliation between previously projected estimates and actual audited figures;
(6) A list of all stockholders with a three percent or more interest in the franchise or, if
applicable, its parent corporation, during the fiscal year and a list of all officers and members of the
board of directors of the franchisee and, if applicable, a list of all officers of the parent corporation of
the franchisee; and
(7) Such other information as the town manager or the town council may reasonably direct.
(b) Annual plant survey report. A franchisee shall prepare and submit, by August 31st of each
year, a complete survey of its plant and a full report thereon to the town council. The purpose of the
report shall be to assure the town that the technical standards of the FCC and other applicable
standards established herein are being maintained. The plant survey shall include appropriate electronic
measurements and shall be conducted in conformance with such requirements, including supervision,
as the town manager may require.
(c) Income tax reports. In addition, a franchisee shall furnish to the town manager, within ten
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AN ORDINANCE: AM]~NDING CHAPTER 5.1 OF THE TOWN CODE TO ESTABLISH
REGULATIONS AND PROCEDURES FOR THE GRANT OF ADDITIONAL
CABLE TELEVISION F1L~CHISES
days after filing, a true copy of its federal income tax return.
Sec. 5.1-4~ 6_~0. Service requirements.
(a) A franchisee shall comply with all technical standards and specifications established by the
FCC throughout the entire period of its franchise.
(b) A franchisee shall render efficient service, make repairs promptly and interrupt the service
only for good cause and for the shortest time possible. Such interruptions, insofar as possible, will be
preceded by notice and shall occur during periods of minimum use of the system.
(c) A franchisee shall maintain its principal office in the town, which shall be open during all
usual business hours, have a publicly listed telephone and be so operated that complaints and requests
for repairs or adjustments may be received and acted upon on a 24-hour basis.
ARTICLE 1~ XII. RATES; COMPLAINTS, PROCEEDINGS
Sec. 5.1-44 6..~1. Filing and publication of rates, rules and regulations.
A franchisee shall publish and file with the town manager schedules of all rates and charges
for all services offered to the subscribing public. Such schedules shall plainly state the cost of each
particular service or combination of services, together with all rules, regulations and requirements
affecting the installation, maintenance and provision of service or which otherwise affect the quality
or cost of such service to the subscriber. The manner and form by which such schedules are published
shall be reviewed and approved by the town manager. Copies of all such schedules shall be available
to the public upon payment of a reasonable fee equal to the cost of reproduction.
Sec. 5.1~1~ 6_~2. Discriminatory or preferential practices prohibited.
The franchisee shall not~ in its rates or charges, or in making available the services of facilities
of its system, or in its rules or regulations, or in any other respect, make or grant a preference or
advantage to any subscriber or potential user of the cable television system or to any user or potentiai
user of the cable television system; and shall not subject any such person to any prejudice or
disadvantage.
This provision shall not be deemed to prohibit promotional campaigns to stimulate subscriptions
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AN ORDINANCE: AMENDING CHAPTER 5.1 OF THE TOWN CODE TO ESTABLISH
REGUI~TIONS AND PROCEDURF~ FOR THE GRANT OF ADDITIONAL
CABLE TELEVISION FRANCHISES
to the cable television system or other legitimate uses thereof. Notwithstanding the aforementioned, this
provision shall not prohibit the frauchisee's establishment of special rates or charges for subscribers
eligible and participating in the town's real estate tax relief for the elderly program or handicapped
persons, as defined in Section 46.1-104.1 (al) of the Code of Virginia.
Sec. 5.1-4~ 6_~3. Rates.
(a) A frauchisee's initial rates for both basic subscriber service and special services shall not
exceed the rates submitted in the franchisee's application as a part of its proposal for a cable television
system franchise for a minimum period of one year. Thereafter, future rate increases throughout the
term of the franchise shah be governed by the procedures set out in the franchise agreement between
the town and franchise. Calculation of the time period that initial rates are valid will begin following
the first subscriber connection.
(b) Notwithstanding the above, the town reserves the right to regulate cable installation and
service fees for all cable services upon the finding that monthly service charges for one or more services
or one or more installation charges exceeds by ten percent the average charges in use by cable firms
in other jurisdictions within a 50-mile radius of the town. Upon notice of this finding to the franchisee,
the franchisee shall reduce the offending charges to within the ten percent limit prescribed within 30
days from said notice or the town shall implement permanent rate regulation procedures for the life
of the franchise. The town shall have the sole authority to develop procedures and methodology for rate
regulation to insure reasonable rate regulation and a fair return on investment by the franchisee in the
cable system. In determining a franchisee's rate base for reviewing proposed rate increases, the town
shall not in any event take into account any value beyond the net book value of a cable plant then in
existence and devoted to cable television service. The regulation procedure at a minimum shall include
hearings and 60 days' notice from the effective date of any rate increase requested.
Sec. 5.1-~.~. 64. Complaints.
(a) Complaints by any subscriber may be filed with the franchisee in writing or delivered to the
franchisee orally in person or by telephone.
AN ORDINANCE:
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AMENDING CHAPTER 5.1 OF THE TOWN CODE TO ESTABLISH
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(b) Any complaints received from subscribers shall be investigated by the franchisee and acted
upon as soon as possible, w/thin one business day of the receipt
(c) The franchisee shall keep a maintenance service log that will indicate the nature of each
complaint, the name of the employee of the franchisee receiving the complaint, the date and time it
was received, the disposition of the complaint and time and date thereof. The log shall also indicate
specific steps taken by the franchisee to remedy the complaint. This log shall be made available for
inspection upon request by the town manager.
(d) Notwithstanding the above, the franchisee shall advise the town manager in writing on a
quarterly basis of ail unresolved complaints. The nature and number of unresolved complaints shall be
considered by the town council during any subsequent renegotiations for extension of any cable
television system franchise.
ARTICLE ~ XIII. FINANCIAL AND INSURANCE
PROVISIONS
Sec. 5.1-44 65. Franchise fee.
(a) As compensation for any franchise granted pursuant to this chapter in consideration of
permission to use the streets and public ways of the town for the construction, operation, maintenance
and reconstruction of the cable television system, the franchisee shall pay to the town an amount
equal to thrcc five percent of the franchisee's gross annual receipts from all sources attributai to the
operations of the franchise within the town, including but not limited to pay cable, advertising, leased
access and any lump sum connection fees.
! in an}' y~r in v;hich thc ~n~_b!c +~!c-~zion ~'~m h~ ~,OO9 z'abz~bcr ~onnc~on~. Reserved.
(c) Payments to the town under this provision shall be computed quarterly, for the preceding
quarter as of March 31, June 30, September 30 and December 31. Each quarterly payment shall be
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due and payable no later than 30 days after the applicable computation date. Each payment shall be
accompanied by a report showing the basis for the computation and such other relevant material as
required by the Town Manager.
(d) Acceptance of any payment by the town should not be construed as agreement that the
amount paid is in fact the correct amount, nor shall such acceptance of payment be construed as release
of any claim for additional amounts payable to the town. Ail amounts paid shall be subject to audit and
recomputation by the town. In the event any such audit or recomputation results in additional revenue
payable to the town, such amounts will be subject to a ten percent simple interest charge.
(e) Nothing in this section shall be interpreted as relieving a franchisee of local taxes.
fmnck~:c fcc :h~'--! bc
Sec. 5.1~7 6_~6. Liability, indemnification anti bonding.
(a) Upon acceptance of any franchise under this chapter, the franchisee shall pay all damages
and penalties which the town may legally be required to pay as a result of granting the franchise. These
damages or penalties shall include, but shall not be limited to, damages arising out of the installation,
operation or maintenance of the cable television system, whether or not any act or omission complained
of is authorized, allowed or prohibited by this chapter.
(b) The franchisee shall provide and pay for any legal defense of the town with regard to all
actions mentioned above.
(c) The franchisee shall maintain, throughout the term of its franchise, liability insurance in
companies acceptable to the town sufficient to cover such indemnification and naming as insured the
town and the franchisee with minimum limits of $500,000.00 on account of bodily injuries to or death
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of one person, $1,000,000.00 on account of bodily injuries to or death of more than one person as a
result of any one accident or disaster and $500,000.00 on account of damage to property and it will
further deposit the policy or policies of such insurance along with certificates therefor with the town
within 30 days of execution of any franchise agreement.
(d) Within 30 days of execution of a franchise agreement, a franchisee shall provide and
maintain, as herein provided, a faithful performance corporate surety bond or other performance
guarantee in a form approved by the town attorney, running to the town, in the penal sum of
$100,000.00, payable to the town. The bond shall be released by the town in full upon the franchisee
meeting the requirements of subsection 5.1-~ 41(b) herein.
(e) The bonds, performance guarantees and insurance policies called for herein shall also
indemnify the Town and other interested parties against anv destruction or d,mage to private property.,
utility lines, or the facilities of any existing Franchisee, interruption to the service of anv e×isting
Franchisee, and any judgments or costs resulting from any litigation ar~.~ing out of the award of a
Franchise to the Applicant or its activities pursuant thereto.
Sec. 5.1-4~ 6__~7. Security Fund.
Prior to the execution of a franchise agreement, a franchisee shall deposit $5,000.00 in an
escrow account with the town director of finance to be held by the town and invested in accordance
to subsection 2-84 (b) of the Town Code, throughout the initial and any subsequent term of a franchise.
This fund will provide cash as security for the faithful performance by the franchisee of the provisions
of this chapter and of its franchise relating to construction and compliance with all order, permits and
directions of any department of the town having jurisdiction over its acts or default. Within 30 days
after notice to it that any amount has been withdrawn from the security fund deposit as provided
herein, the franchisee shall deposit in such account a sum of money equal to the amount withdrawn.
Sec. 5.1-49 6_~8. Penalties.
For violation of the provisions of this chapter, penalties shall be chargeable by the manager to
the security fund unless corrected within ten days of written notice thereof by certified, mail to the
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franchisee as follows:
(a) For failure to submit plans indicating expected dates of installation of various parts of the
system, per day .................................................................. $25.00
Co) For failure to commence operations in accordance with requirements herein, per
day ........................................ $50.00
(c) For failure to complete construction and installation of system as required, per
day ........................................ $50.00
(d) For failure to supply data requested by town in connection with installation, construction,
customers or financial reports, per day ................... $25.00
(e) For failure to restore the security fund as required within the specified 30 days, the entire
cash deposit remaining, if any, and the full amount of the performance bond shall be forfeited.
The franchisee may request the manager exclude from the ten-day correction period delays equal to
the time lost for acts of God, labor disputes, abnormal weather conditions, fires or other causes outside
its control.
ARTICLE 3~I XIV. ADMINISTRATION
Sec. 5.1~d} 6J. Town manager--Generally.
The day regulation, enforcement and administration of any franchise granted under this chapter
shall be the responsibility of the town manager.
Sec. 5.1-~ 70. Same--Functions.
The town manager's authority and responsibilities with respect to a franchise granted pursuant
to this chapter shall include the followinE.
(a) To assist in the preparation of the invitation to bid for cable television system franchises,
establish criteria for review and ranking of franchise application, review and screen applications
for franchises and make selection recommendations to the council.
(b) To monitor and enforce all aspects of the franchisee's performance in meeting all terms,
provisions, requirements and construction schedules established in this chapter.
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(c) To advise and make recommendations to the council on matters which may constitute
grounds for revocation of a franchise in accordance with this chapter.
(d) To monitor and investigate where appropriate complaints against the franchisee by any
person.
ARTICLE .x2_! XV. RIGHTS OF INDIVIDUALS
Sec. 5.1-~ 7_~1. Discriminatory employment practices prohibited.
The franchisees shall not deny service, access or otherwise discriminate against subscribers,
channel users or general citizens on the basis of race, color:, religion, national origin or sex. The
franchisees shall strictly adhere to any equal employment opportunity requirements of the FCC. THe
franchisees shall comply with all other applicable federal, state and town laws, and all executive and
administrative orders relating to nondiscrimination.
Sec. 5.1-~1 7__~2. Restrictions on cable monitoring.
Except as otherwise provided by this section, the franchisee shall not monitor or arrange for
the monitoring or permit any person, either expressed or implied through their knowledge, to monitor
any subscriber outlet or receiver for any purpose whatsoever, without the specific written authorization
of the subscriber being monitored and other than to the extent so authorized by such subscriber. Any
information gathered by such monitoring shall not be sold, given or otherwise transferred to any person
not in the employ of the franchisee or the person supplying the service involved, provided that the
franchisee may conduct such monitoring as may be reasonably necessary for: (1) the maintenance and
operation of the cable television system; and (2) the collection of data for the purpose of ascertaining
viewer response to programming. Any data collected for the purpose of ascertaining viewer response to
programming may be disseminated on a aggregate basis only and may not in any way reveal or indicate
any information on individual subscribers.
Sec. 5.1~4 73__. Privacy and other human rights.
The franchisee and the town shall maintain constant vigilance with regard to possible abuses
of the right and privacy or other human rights of any subscriber, programmer or general citizen
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resulting from any device or signal associated with the system.
Sec. 5.1-~ 74. Permission of property owner required.
No cable line, wire, amplifier, converter or other piece of equipment owned by a franchisee shall
be installed by a franchisee without first securing the permission of the owner of any property or
easement involved. If such permission is later revoked, whether by the original or a subsequent owner,
the franchisee shall remove forthwith any of its equipment which is both visible and movable and
promptly restore the property to its original condition.
Sec. 5.1-$6 7_~5. Sale of subscriber lists prohibited.
A franchisee shall not sell, or otherwise make available, lists of the names and addresses of its
subscribers, without permission of the subscribers, to anyone other than authorized town officials for
purposes of enforcing franchise provisions.
ARTICLE ?~_!! XVI. MISCELLANEOUS PROVISIONS
Sec. 5.1-~ 76. Fraud.
It shall be unlawful for any person to defraud or attempt to defraud any cable television system
franchisee by attempting to obtain any service therefrom without payment as described in Section 18.2-
187.1 of the Code of Virginia. Any person who violates this provision, if the value of service, credit or
benefit procured is $100.00 or more, shall be guilty of a class 6 felony; or if the value be less than
$100.00 shall be guilty of a class 1 misdemeanor, as penalties for such are set out in the Code of
Virginia.
Sec. 5.1-~ 77. No recourse against the town.
The franchisee shall have no recourse whatsoever against the town or its officials, boards,
commissions, agents or employees for any loss, cost, expense or damage arising out of any provision or
requirement of this chapter or because of the enforcement of this chapter, unless the same shall be
caused by criminal acts or by willful or gross negligence.
Sec. $.1-~ 78. Official name of franchise.
Any franchisee licensed to operate a cable television system within the town shall include the
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word "Leesburg" in the official name of the said firm or corporation so authorized, upon the request
of the town.
Sec. 5.1~ 7._~9. Extensions outside corporate limits.
(a) The franchisee shall not extend cable television service to residents outside the franchise
territory until it has met the requirements of subsection 5.1-24} 41(b) of this chapter. Where extensions
of the cable television system are made outside the corporate limits of the town and connect to the
cable television system's iheadend, the monthly rate for basic service and special service to customers
outside of town shall contain a $1.00 surcharge which the franchisee shall pass directly through to the
town on a quarterly basis. This fee reimburses the town for costs of administration and regulation of
the cable television system. The franchisee's receipts from cable services outside the corporate limits
of the town shall be excluded from the gross annual receipts used to calculate the franchise fee.
(b) For the purpose of determining the number of subscribers with respect to section 5.1-26 47
of this chapter, subscribers residing outside the town shall be included.
ARTICLE ._vArY XVII. CABLE TELEVISION
ADVISORY COMMISSION
Sec. 5.1~;]~ 80. Commission established generally.
(a) The Leesburg Cable Television Advisory Commission is hereby established. The commission
shall consist of six members who shall be residents of the town. The office of any member shall be
vacated if he or she becomes a nonresident of the town. Any vacancy shall be filled for the unexpired
term in the same manner as provided herein for original and subsequent appointments. Members shall
serve for terms of four years except for councilmanic members. The first five members' terms shall end
on June 30, 1983, with ensuing terms ending every four years thereafter. The mayor shall appoint three
members by and with the consent of the town council and two members shall be appointed by the
franchisee by and with the consent of the town council. The council shall appoint one member from
the council to serve on the commission whose term of office shall correspond to his official tenure of
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office as a councilmember. No member of the commission shall have any interest in franchisee or its
contractors; or be an employee of the town. Members of the commission shall be subscribers of the
cable television system during their terms when service is available to their residences.
CO) Members shall be paid $600.00 each per year by the town, payable in equal monthly
installments. Members shall be reimbursed for actual expenses incurred in the exercise of their
functions subject to the availability of fund appropriated for the purpose and as approved in advance
by the town manager.
(c) The commission shall elect its chairman annually and the town manager, or his designate,
shall serve as secretary. The commission shall meet monthly or more often as determined by the
commission.
Sec. 5.1-6~ 81. Powers and duties.
The commission shall have the following powers and duties:
(a) To adopt rules governing conduct of its business and meetings.
Co) To maintain a continuous oversight and review of cable system operations and advise
the town on franchisee's compliance with the terms of this contract.
(c) To encourage the use of access channels among the widest range of institutions, groups
and individuals and to monitor franchisee's access policies and practices, including
charges for these services, to insure compliance with Section 5.1-42 62 of the town code.
(d) To make recommendations of general policy to the franchisee relating to the service
provided subscribers in the operation and use of access channels with a view of
maximizing the diversity of programs and services to subscribers.
(e) To review franchisee's proposals for rate revisions and make timely findings of fact and
recommendations regarding rates to the town.
(f) To make suggestions to the franchisee for appropriate local origination and public access
programming, and to resolve disputes regarding noncommercial use of time on access
channels.
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(g) To assist public access and other channel users with grants and other resources made
available to the commission.
(h) To identify and pursue sources of funds for local programming.
(i) To review and make recommendations to the town on proposed annual budgets for town
expenditures related to cable television.
(j) To review, investigate and make findings of fact relating to compliance and disputes
arising from subscribers and other users of the system.
(k) To require that franchisee prepare and make available to the public its current policies
and charges for commercial and noncommercial use of studio and mobile television
production facilities and access to channel time on the cable television system.
SECTION II. This Ordinance shall be in full force and effect upon its passage.
PASSED this 28,-h day of
ATTEST:
Clerk of Council
January , 1991.
Town of Leesburg
o:cable