HomeMy Public PortalAbout2004_05_25_O004 Franchise Agreement with Lamont Digital d.b.a. GatehouseThe Town of
Leesburg,
Virginia
ORDINANCE NO.
2004-0-04
PRESENTED
ADOPTED
May 25, 2004
Max/25, 2004
AN ORDINANCE: GRANTING A CABLE TELEVISION FRANCHISE TO LAMONT DIGITAL
SYSTEMS, INC. d/b/a GATEHOUSE NETWORKS, SUBJECT TO CERTAIN
CONDITIONS
WHEREAS, on November 14, 2003, Lamont Digital Systems, Inc. d/b/a Gatehouse Networks
("Gatehouse"), filed an application with the Town of Leesburg, Virginia, seeking a limited area franchise
to build and operate a cable television system and to provide cable service in the development in the town
known as Edwards Landing; and
WHEREAS, on January 20, February 17, 2004, and March 16, 2004 the Leesburg Cable
Television Advisory Commission ("Commission") held public meetings on Gatehouse's franchise
application, and received additional input on the matter from electronic mail and other written documents,
and received written materials from the town's incumbent cable television franchisee, Adelphia
Communications Corporation ("Adelphia") setting forth its views on Gatehouse's application; and
WHEREAS, on March 16, 2004, the Commission adopted a resolution recommending approval
of Gatehouse's franchise application subject to conditions; and
WHEREAS, Council has considered the input it has received from the public, Gatehouse, and
Adelphia, and the input it has received from town staff, the town Attorney, the town' s outside counsel,
and the Commission; and
WHEREAS, on May 11, 2004 the Council conducted a public hearing on Gatehouse's application
after proper public notice; and
WHEREAS, Council has considered each of the factors that Sections 5.1-11 and 5.1-12 of the
Town Code and Virginia Code Section 5.2-2108 provide should be considered in evaluating Gatehouse's
franchise application; and
-2-
AN ORDINANCE: GRANTING A CABLE TELEVISION FRANCHISE TO GATEHOUSE
WHEREAS, based on that input and those factors Council has determined that Gatehouse's
application should be approved, and that Gatehouse should be granted a cable television franchise, subject
to certain terms and conditions that the Council believes are appropriate and necessary to attach to any
such franchise granted to Gatehouse to ensure that the rights and interests of the town and its residents
will be protected.
THEREFORE, ORDAINED by the Council of the Town of Leesburg in Virginia as follows:
SECTION I. That Council hereby approves the Gatehouse application for a cable television
franchise, and the Mayor is authorized to execute a franchise agreement, but only on terms substantially
similar to those set forth in the draft franchise agreement between Gatehouse and the town attached hereto
as Exhibit A.
SECTION II. That, as a further condition of such approval, Gatehouse shall be required to
reimburse the town for all costs incurred by the town in the application process in excess of the amount of
the filing fee paid by Gatehouse, as required by Section 5.1-9(c) of the Town Code.
SECTION III. That, in the event Gatehouse is unwilling to accept franchise terms and conditions
substantially similar to those set forth in Exhibit A, Gatehouse' s franchise application shall be deemed to
be denied.
SECTION IV. This ordinance shall be in effect upon passage.
PASSED this 25~h day of May 2004
?~k of Council
004: Gatehouse
Kris~'ei~rC. U~stattd, 1V/ay~r': --'
Town of Leesburg
FRANCHISE AGREEMENT
BETWEEN
THE TOWN OF LEESBURG,
VIRGINIA
AND
LAMONT DIGITAL SYSTEMS, INC.
d/b/a GATEHOUSE NETWORKS
TABLE OF CONTENTS
VI.
VII.
VIII.
IX.
X.
XI.
XII.
XIII.
XIV.
XV.
XVI.
XVII.
XVIII.
XIX.
GRANTED TO LAMONT DIGITAL SYSTEMS, INC. d/b/a GATEHOUSE
NETWORKS .............................................................................................. 1
RIGHT OF TOWN TO ISSUE FRANCHISE ............................................... 2
TERM ......................................................................................................... 2
FRANCHISE NONEXCLUSIVE .................................................................. 2
INCORPORATION OF THE CABLE ORDINANCE BY REFERENCE AND
RESOLUTION OF CONFLICTS ................................................................. 3
INCORPORATION OF APPLICATION BY REFERENCE .......................... 3
DEFINITIONS ............................................................................................. 3
SERVICE AREA ......................................................................................... 4
SYSTEM AND CAPACITY ......................................................................... 4
CONSTRUCTION ...................................................................................... 7
SYSTEM SERVICES ................................................................................. 8
ACCESS CHANNELS, EQUIPMENT, FACILITIES, AND SERVICES ..... 10
INSTITUTIONAL NETWORK ................................................................... 13
INTERCONNECTION .............................................................................. 13
NON-DISCRIMINATION ........................................................................... 14
RATES ..................................................................................................... 14
FRANCHISE RENEWAL .......................................................................... 15
POLICE POWERS ................................................................................... 15
FRANCHISE FEE AND PERFORMANCE BOND .................................... 15
XX.
XXI.
XXII.
XXIII.
XXIV.
XXV.
XXVI.
XXVlI.
XXVIII.
XXIX.
XXX.
REGULATION .......................................................................................... 16
REMEDIES ............................................................................................... 16
COOPERATION ....................................................................................... 17
WAIVER ................................................................................................... 18
CUMULATIVE PROVISION ..................................................................... 18
NO LIABILITY ........................................................................................... 18
NOTICES ................................................................................................. 18
CAPTIONS ............................................................................................... 19
NO dOINT VENTURE .............................................................................. 19
ENTIRE AGREEMENT ............................................................................ 19
SEVERABILITY ........................................................................................ 19
CABLE TELEVISION
FRANCHISE AGREEMENT
THIS AGREEMENT is made and entered into as of this day of ,2004, by
and between the Town of Leesburg, Virginia, hereinafter referred to as "Town," and
Lamont Digital Systems, Inc. d/b/a Gatehouse Networks, a Connecticut Corporation, with
its principal place of business in Connecticut, at 35 Mason Street, Greenwich, CT 06830,
hereinafter referred to as "Franchisee," also known as "Gatehouse."
WHEREAS, the Town is authorized to grant one or more nonexclusive, revocable,
franchises to construct, operate, and maintain a cable television system within the Town;
WHEREAS, Franchisee will construct a cable television system as set forth herein;
WHEREAS, the Town, after due evaluation, has determined that it is in the best
interest of the Town and its residents to grant a Franchise to Franchisee
NOW, THEREFORE, IN CONSIDERATION of the mutual promises and covenants
contained herein, the parties do mutually agree as follows:
GRANTED TO LAMONT DIGITAL SYSTEMS, INC. d/b/a/GATEHOUSE
NETWORKS
A. Purpose. The purpose of this section is to award a Franchise for a cable
television system to Franchisee.
B. Enactment. Franchisee is hereby granted a nonexclusive Franchise to
operate a cable television system solely to provide cable services, including, but not limited
to, Internet service, within that portion of the Town known as Edward's Landing, as more
particularly described in Appendix A hereto ("Limited Service Area"), and in accordance
with the Cable Television Ordinance, Chapter 5.1 of the Town Code (the "Ordinance"),
which establishes standards, regulations and procedures for the granting of a cable
television Franchise, this Franchise Agreement, and the rules and regulations adopted by
the Town Council, all ordinances of the Town and all applicable rules and regulations of the
Federal Communications Commission and the Town.
C. Effective Date. This Franchise Agreement shall become effective upon
passage by the Town Council and prior acceptance by Franchisee.
D. Use of Public Ways. For the purpose of operating and maintaining a cable
television system in the Limited Service Area, Franchisee may erect, in, over, under, or
upon, across, and along the public streets, alleys, and ways within the Limited Service Area
such wires, cables, fiber optics, conductors, ducts, conduits, vaults, manholes, amplifiers,
appliances, pedestals, attachments, and other equipment as are necessary and
appurtenant to the operation of the cable television system in the Limited Service Area and
in accordance with this Franchise Agreement and the Ordinance.
E. Settlement and Release of Prior Claims. In settlement and release of all
claims by the Town that Grantee has violated certain provisions of the Ordinance prior to
the effective date hereof, Grantee shall (1) on or before the effective date, pay to the Town
the sum of $20,000, provided that Grantee (Lamont Digital Systems, Inc.) does not admit
nor shall the making of that payment constitute an admission of any liability, violation or
wrongdoing, whatsoever; and (2) in addition to its obligations under Section 5.1-44 of the
Ordinance, indemnify and hold harmless the Town, its officers, departments, boards,
commissions, employees, and agents from any and all claims, damages and penalties,
including attorneys fees, arising out of or related to the Town's granting of this Franchise to
Franchisee.
II. RIGHT OF TOWN TO ISSUE FRANCHISE.
Franchisee acknowledges and accepts the legal right of the Town to issue this
Franchise Agreement.
III. TERM.
The term of this Franchise Agreement shall be for a period not to exceed Adelphia's
current franchise agreement, as hereinafter defined, which terminates on October 31,
2010, unless sooner terminated as provided in the Ordinance, at which time it shall expire
and be of no further force and effect.
IV.
FRANCHISE NONEXCLUSIVE.
This Franchise Agreement shall not be construed as any limitation upon the right of
the Town to grant to other persons rights, privileges, or authorities similar to the rights,
privileges, and authorities herein set forth, in the same or other streets, alleys, or other
public ways or public places. The Town specifically reserves the right to grant at any time
during the term of this Franchise Agreement or renewal thereof, if any, such additional
Franchises for a cable television system as it deems appropriate.
2
INCORPORATION OF THE CABLE ORDINANCE BY REFERENCE AND
RESOLUTION OF CONFLICTS.
The Cable Ordinance is incorporated into and made part of this Franchise
Agreement. The Franchisee agrees to comply with all conditions, requirements and
obligations of the Ordinance as it exists on the date of execution of this Franchise
Agreement. The Franchisee further agrees to comply with all amendments to the
Ordinance enacted after the execution of this Franchise Agreement. In the case of conflict
between the Ordinance and this Franchise Agreement, the provision that the Town in its
sole discretion provides the greatest benefit to the Town or imposes the greatest
obligations on the Franchisee shall apply.
VI. INCORPORATION OF APPLICATION BY REFERENCE.
Franchisee's franchise application submitted to the Town on November 14, 2003, is
hereby incorporated by reference. The express terms of this Franchise Agreement shall
prevail over conflicting or inconsistent provisions of the Franchisee's franchise application.
VII. DEFINITIONS.
All definitions set forth in the Ordinance pertain to this Franchise Agreement and
shall be relevant to the purposes and meaning of this Franchise Agreement.
In addition, the following additional definitions shall apply:
A. "Adelphia" means Adelphia Communications Corporation or any lawful or
permitted successor or assign of Adelphia Communications Corporation that becomes,
during the term of this Agreement, the franchisee of the Adelphia Franchise.
B. "Adelphia Franchise" means the Franchise Agreement between the Town of
Leesburg, Virginia, and Adelphia Communications Corporation, dated October 31,2000.
C. "Other Franchisee" means any person other than Franchisee or Adelphia with
whom, after the effective date hereof, the Town enters into a cable franchise agreement
pursuant to the Ordinance.
VIII.
SERVICE AREA.
3
A. Limited Service Area. The service area of Franchisee shall be limited to the
boundaries of the development known as Edward's Landing as more specifically described
in Appendix A to this Franchise Agreement.
B. Cable Service. Franchisee shall provide cable service to all occupied
dwelling units in the Limited Service Area. Franchisee shall provide subscribers with a
standard drop of one hundred and fifty feet (150'). Service in excess of 150 feet shall be
charged to the customer as such cost exceeds the normal cost of a standard drop. New
residents shall be offered service within seven (7) days after occupancy. Franchisee shall
use its best efforts to construct at the same time as the utilities operating in the Limited
Service Area.
C. Commercial Service. Franchisee shall, upon request, make service available
to all commercial/industrial, hotels, apartment complexes and other commercial
establishments, if any, within the Limited Service Area at Franchisee's standard installation
rate expense. For commercial/industrial establishments served underground or for aerial
extensions beyond 150 feet, Franchisee shall, upon request, make service available on the
basis of a capital contribution in aid of construction, including cost of material, labor, and
easements.
D. House Moving. Franchisee shall, upon the request of the Town, move and
replace its facilities to accommodate house moves conducted on behalf of the Town, free
of charge to the Town. Upon request of a homeowner, Franchisee shall move and replace
its facilities to accommodate house moves conducted by the homeowner at a reasonable
cost. Wherever feasible, the Town shall use its best efforts to ensure that house moves
follow the same or similar path.
IX.
SYSTEM AND CAPACITY.
A. System. The parties understand and agree that Franchisee shall install its
cable system to deliver cable television signals processed at 860 MHZ utilizing a fiber to
the node design or better. The system shall be designed to support eighty-four (84) analog
channels plus have additional capacity available for digital transmission. The system will
use all new fiber optics, and electronic and passive devices. New coaxial cable shall be
utilized. The system will be designed so that there are no more than five (5) amplifiers in
cascade. Fiber optic receiver nodes located throughout the plant will divide the distribution
of cable signals from 200 homes per fiber node or less. At the completion of construction,
the Franchisee's cable system shall only be placed in public rights-of-way or on private
property where a duly authorized easement has been obtained prior to construction on the
property. The system shall be operated in accordance with Federal Communications
Commission technical regulations or guidelines.
4
B. Construction Timetable. System construction within the Limited Service Area
shall be completed prior to the occupancy of the final dwelling that is constructed in any
part of the Limited Service Area, which Franchisee currently estimates to be on or before
March 31, 2005. Franchisee shall provide a neighborhood construction schedule, which
details the time frame for construction in each area of the Limited Service Area.
C. Construction Oversight. Franchisee will use professional project
management techniques to overseen all construction projects, including the assignment of
a designated Project Manager/Coordinator, adequate qualification of all subcontractors,
and full compliance with local codes and accepted industry standards for construction.
Signal purity and strength will be measured at all nodes and at a sufficient sampling of taps
to insure quality of construction practice. The Franchisee shall designate an employee to
act as a company representative by responding to public service complaints on a daily
basis and provide the Town with the person's name and telephone number. Franchisee
shall use its best efforts to minimize traffic disruption during construction and coordinate
construction scheduling with the Town.
D. Compliance with Applicable Law. In constructing, operating and maintaining
the system, Franchisee shall at all times comply with the Ordinance and all applicable laws
and regulations.
E. Drop Audit. While Franchisee does not perform routine drop audits, all
appropriate signal ratios are checked on each installation and service call, new installation,
or major plant modification. Upon completion of system construction, a minimum of 5% of
the taps will have been tested for signal ratios and quality. Drops not meeting the
standards of the National Electric Code shall be replaced when found to be substandard.
Any drops using RG 59 cable shall be replaced. Franchisee shall use reasonable efforts to
gain entry into subscriber homes to check drops.
F. Equipment Quality. Equipment used for the distribution system, headend and
reception facilities shall be of good and durable quality and be serviced and repaired on a
regular basis, and shall at all times be of equal or better quality than the equipment
originally installed for the initial construction of the plant to 860 MHZ.
G. Emergency Alert. Franchisee shall comply with the requirements of the
Federal emergency alert system as specified by the FCC (47 CFR Part 11.1, et seq.).
Franchisee shall provide the Town with a Local Alert System ("LAS") which shall allow the
Town to initiate audio emergency messages to cable subscribers from any touch-tone
phone with an access code. At such time as a video crawl on all channels for emergency
messages is available on the system, it shall be made available to the Town for emergency
messages which can be inserted by the Town from the Town Government Center.
Persons to be provided with access codes shall be selected by the Town. The Town
5
requires that its government channel serve as the emergency video feed. Town shall
consult with the Franchisee when developing policies to govern the activation of the LAS.
H. Ongoing Preventive Maintenance. Franchisee will comply will all relevant
FCC guidelines for system maintenance and will provide quarterly reports, when requested,
to the Town of service outages, persistent maintenance problems, and customer complaint
resolution.
I. Standby power. Franchisee shall provide a minimum of fifteen minutes of
standby power generating capacity at the headend, Franchisee shall maintain standby
power system supplies, rated at least fifteen minutes duration, at all optical node locations
in the distribution network
J. Parental Control Devices. Franchisee shall provide to subscribers, upon
request, parental control devices that allow any channel or channels to be locked out.
Such devices shall block both the video and the audio portion of such channels to the
extent that both are unintelligible. The cost to subscribers for parental control devices is
subject to FCC regulation. If primarily adult-only programming is offered on the system,
Franchisee shall block the video and audio portions of all primarily adult programming
services to non-subscribers of such service.
K. Performance Testing. Franchisee shall perform all system tests and
maintenance procedures as required by and in accordance with: the FCC; this Franchise
Agreement; the Ordinance; and Franchisee's standards of good operating practice.
L. Technical Standards. The cable television system permitted to be operated
hereunder shall be installed and operated in conformance with the Ordinance, this
Franchise Agreement, and FCC rules and regulations. Any FCC technical standards or
guidelines related to the cable television system and facilities shall be deemed to be
regulations under this Franchise Agreement. At such time as the FCC does not regulate
technical standards, the latest FCC standards shall be utilized.
M. Employee Identification. Franchisee shall provide a standard identification
document to all employees, including employees of subcontractors, who will be in contact
with the public. Such documents shall include a telephone number that can be used to
verify identification. In addition, Franchisee shall use its best efforts to clearly identify all
field personnel, vehicles, and other major equipment that are operating under the authority
of Franchisee.
N. Stereo. The system will have the capability and shall pass Broadcast
Television Systems Committee (BTSC) stereo signals or other stereo signals for those
broadcast, satellite, and locally originated services which transmit them.
6
CONSTRUCTION.
A. System Design Review. The Town shall have the authority to review the
technical design plans of the system to ensure that the system design meets the
requirements of this Franchise Agreement and the Ordinance. To the extent exempt from
the Virginia Freedom of Information Act under Section 22.1-342.01(62) of the Code of
Virginia, Franchisee shall provide the Town with the following design information:
engineering design maps; key map for design maps; system level design information (e.g.
block diagram of headend, satellite or off-air studies, power supply map); test plan for the
coaxial cable to be used in the system; and contact engineer who will be available to
discuss project details. Franchisee shall provide the Town with reasonable access to any
such information, which is not exempt.
B. Construction Methods. Franchisee shall construct the system in accordance
with Franchisee's construction manual, a copy of which will be kept in the Town Clerk's
office, and incorporated by reference, and shall be provided to the Town within one
hundred eighty (180) days of the effective date of this Agreement. The Franchisee shall
follow the permitting process as specified by the Town. Internal wiring shall comply with
the County of Loudoun's electrical code.
C. Underground Construction. Franchisee shall participate in and use the local
utility identification service. Franchisee shall ensure that cable is buried at a depth of three
feet (3') within public road right-of-way as required by the Town's Design and Construction
Standards Manual. Temporary drops shall be buried within sixty (60) days or in the case of
a problem obtaining an easement, within ninety (90) days of installation, weather
permitting.
D. Consumer Compatibility. Franchisee shall comply with FCC consumer
compatibility rules and guidelines and will use its best efforts to provide subscriber- friendly
technology. As required by FCC rules, the basic service shall be offered in a format
compatible with cable-ready television sets.
E. Quality of Construction. Construction, installation, operation and
maintenance of the cable television system shall be performed in an orderly and
workmanlike manner, in accordance with then-current technological standards. All cables
and wires shall be installed, where reasonably possible, parallel with electric and telephone
lines. Multiple cable configurations shall be arranged in parallel and bundled with due
respect for aesthetic, safety and engineering considerations and construction shall be in
compliance with all applicable Federal, State, County, and local codes and regulations.
F. Right of Inspection of Construction. The Town shall have the right to inspect
all construction or installation work performed subject to the provisions of this Franchise
7
Agreement and the Ordinance and to make such tests as it shall find necessary to ensure
compliance with the terms of this Franchise Agreement and the Ordinance and other
pertinent provisions of law.
G. Inspection Costs. If required by the Town, Franchisee agrees to pay the
reasonable costs of nonrecurring requirements for inspection of subscriber house drops
and/or other portions of the cable system distribution network, during the system's
construction period.
XI.
SYSTEM SERVICES.
A. Initial Residential Subscriber Services. Upon activation of the system and
thereafter, Franchisee shall provide, at a minimum, one hundred (100) activated channels.
Throughout the term of this Franchise, Franchisee shall provide at least the same mix,
level, and quality of programming as provided to subscribers on the date of initial activation
of the system. Franchisee will examine any practical ways of optimizing programming
packaging for the best customer satisfaction and economic results.
B. Discounts. Franchisee shall maintain a special discount for senior citizen
customers of ten percent (10%) for senior citizens, which qualify for property tax
reductions. Franchisee shall maintain a special discount for hearing impaired subscribers
of ten percent (10%) of the basic tier rate.
C. Leased Access Channels. Franchisee shall offer leased access channels at
such terms and conditions and rates as may be negotiated with each lessee subject to the
requirements of Section 612 of the Cable Act.
D. Cable Drops and Monthly Service. Franchisee shall provide free cable
drop(s) and the same number of free, basic and tier services, excluding premium services
and pay-per-view, to all public schools, libraries, institutions of higher education, police
station, fire and rescue stations in the Limited Service Area, and to all public buildings
owned or occupied by the Town which are within the Limited Service Area. All non-
premium programming and closed-circuit training programming shall be transmitted to all of
these locations on the cable system, free of charge. Franchisee shall also provide, at no
cost, any converters or other equipment necessary to view such services.
E. Institutional Channels. The government and educational access channels
shall be provided with the capability to transmit scrambled, closed-circuit institutional
programming. The Franchisee shall provide an appropriate device for the reception of
institutional programming offered over the subscriber network on the scrambled
government and educational access channels to all local government and educational
locations in the Limited Service Area receiving free drops and service. The necessary
8
headend equipment for modulation, scrambling, and cablecasting of the closed-circuit
signals shall be provided by the Franchisee. Franchisee shall provide channel scrambling
and technical assistance to allow pre-assigned time for scrambling the channels as
requested by the Town and educational institutions on the scrambled government and
educational access channel.
F. Closed-Captioning. Franchisee shall pass through all closed-circuit signals
received by the system for the hearing impaired.
G. State-of-the-Art. The Franchisee shall maintain its system facilities and
equipment in a manner which shall continue to enable it to add any new services and
associated equipment and facilities as they are developed, available, and proved
marketable to subscribers. The new services, associated equipment, and facilities shall be
added to the system within one (1) year of when they are provided in any other similar-
sized market owned by the Franchisee or subsidiary companies in the State of Virginia,
excluding experimental and pilot projects.
H. Internal wiring. Franchisee shall connect its service to subscribers who have
installed internal wiring not owned or installed by the Franchisee, providing wiring meets
FCC leakage and transmission standards. Franchisee shall be granted premises access to
conduct tests and measurements to insure signal quality as a part of the installation
process. Denial of access by the premises owner shall be deemed sufficient for
Franchisee to refuse installation of service. Franchisee shall make technical specifications
for such installation available upon the request of subscribers.
I. Office. Franchisee shall maintain a local office in the Town where subscriber
terminal equipment can be exchanged during normal business hours, and where
subscribers may call or visit when a Franchisee representative is present. In addition,
Franchisee shall maintain a remote customer service center, which shall be available to
customers in the Limited Service Area via toll free telephone number so that complaints
and requests for repairs may be acted upon on a twenty-four (24) hour basis. Franchisee
shall communicate the toll free number to the Town and to each home that receives cable
service in the Limited Franchise Area.
Xll.
ACCESS CHANNELS, EQUIPMENT, FACILITIES, AND SERVICES.
In order to develop and promote public, educational, and government ("PEG")
access programming for the system's access channels, Franchisee hereby agrees to
provide the following:
A. Access Channels. Franchisee shall, upon the request of the Town and
subject to Section XIV(A) hereof, provide access channels for the following:
9
(1)
No less than one (1) downstream channel for educational access to be
shared by educational institutions in the County.
(2)
No less than one (1) dedicated downstream channel solely for Town of
Leesburg government access.
(3)
No less than one (1) channel shall be provided for government access which
can be shared with the County.
(4)
One (1) access channel which will be designated for public access and local
origination use by the Franchisee.
(5)
No less than one (1) downstream channel reserved for future access use
exclusively by the Town of Leesburg. Such additional access channel will be
made available to the Town when 70% of prime-time occupancy with original
(non-repeat) programming is demonstrated for six (6) weeks.
All PEG access channels shall be placed on the basic tier of service. The
Franchisee shall use its best efforts to maintain the cable channel positions of the access
channels throughout the term of this Franchise Agreement.
B. Access Equipment and Support.
(1)
In lieu of the staff support for coverage of Town meetings set forth in Section
XII(B) of the Adelphia Franchise, Franchisee agrees to reimburse Adelphia
for Franchisee's pro-rata share of the reasonable and customary direct costs
Adelphia incurs in providing such coverage ("Town Meeting Coverage
Costs"), with Franchisee's share being equal to the Town Meeting Coverage
Costs multiplied by a fraction, the numerator of which shall be the number of
Franchisee's actual subscribers, and the denominator of which shall be the
sum of the number of Adelphia's actual subscribers in the Town, the number
of Franchisee's actual subscribers in the Town, and the number of actual
subscribers in the Town of all Other Franchisees.
(2)
In lieu of the $285,000 payment that Adelphia has made under Section XII(B)
of the Adelphia Franchise, Franchisee shall, within sixty (60) days of the
effective date of this Agreement, make a payment to the Town of $13,704
("PEG Support Payment"). (The PEG Support Payment is derived by
multiplying $285,000 by a fraction, the numerator of which is 394 (total
number of eventual homes in Edwards Landing), and the denominator of
which is 8,194 (394 eventual Edwards Landing homes plus approximately
7800 Adelphia subscribers as of October 31, 2003).) The PEG Support
10
Payment shall be used exclusively for facilities, equipment and support for
PEG access channel operations in the Town.
(3)
The parties agree that the funds for access equipment, facilities, services
and support will not be deducted from the franchise fee or passed through to
subscribers.
C. Character Generator. Franchisee will provide and maintain character
generation equipment in the Town Government Center for the Town's use.
D. Community Access and Local Origination.
(1)
In lieu of the studio access provision of Section XII(D) of the Adelphia
Franchise, Franchisee agrees to reimburse Adelphia for Franchisee's pro
rata share of the portion of the reasonable and customary direct costs
Adelphia incurs in maintaining and operating the community access and local
origination studio in Sterling that is directly attributable to providing public
access (but not local origination) ("Community Access Costs"). Franchisee's
share of the Community Access Costs shall be equal to the Community
Access Costs multiplied by a fraction, the numerator of which shall be the
number of Franchisee's subscribers in the Town, and the denominator of
which shall be the sum of the number of Adelphia's subscribers in the
County, the number of Franchisee's subscribers in the Town, and the
number of subscribers in the Town of all Other Franchisees.
(2)
Both parties agree that said amount shall not be deducted from the franchise
fee or itemized on subscriber bills, and said amount is a part of the rate
base.
E. Studio in Leesburg. If and when Adelphia places a studio in the Town
pursuant to Section XII(E) of the Adelphia Franchise, Franchisee shall reimburse Adelphia
for Franchisee's pro rata share of the Community Access Costs attributable to such studio
pursuant to the formula set forth in Section XII(B)(1) hereof.
F. Publicity. Franchisee agrees to provide the following publicity services at its
own expense:
(1)
If the Franchisee offers a guide to subscribers, and is capable of providing
local program listings, and listings of local access and training channel
programs are provided by the Town in a timely manner, the Franchisee shall
ensure that the Town-provided program listings are carried free of charge, on
a daily basis, on the Franchisee's channel dedicated to providing program
guide information.
11
(2)
To the extent the Town provides the information, Franchisee will include
written information about educational and government access programming
and activities in its customer information materials given to new subscribers.
(3)
At the request of the Town, Franchisee will promote specific programs
through messages on customer bills once each quarter taking into account
that FCC or Franchise required regulatory notices shall be given precedence.
Town may annually print and supply bill stuffers to the Franchisee and the
Franchisee shall include such stuffers when space is available, but at least
once a year. The Town will coordinate with the cable system manager on
distribution.
(4)
On request of the Town, Franchisee agrees to pay Adelphia its pro rata
share (based upon the formula in Section XII (B)(1)) of Adelphia's cost to
produce a minimum of one (1) PSA per year and provide available cross
channel promotional time.
G. Origination Sites. In lieu of the origination sites requirement of Section XII(G)
of the Adelphia Franchise, Franchisee shall reimburse Adelphia in the amount of
Franchisee's pro rata share of the reasonable and customary direct costs incurred by
Adelphia in constructing the fiber optic lines providing the equipment required by Section
XII(G) of the Adelphia Franchise. Franchisee's pro rata share of such costs shall be
determined in accordance with the formula set forth in Section XII (B)(1) hereof.
H. Signal Quality. Franchisee shall use its best efforts to respond to any signal
quality problems on the access channels.
Xlll.
INSTITUTIONAL NETWORK.
A. Payment in Lieu of Institutional Network. In lieu of the institutional network
provisions of Section XIII of Adelphia Franchise, Franchisee shall, within 120 days of the
effective date hereof, pay the Town an amount as calculated in this subsection ("l-Net
Substitute Payment"). The I-Net Substitute Payment shall be calculated by (1) deriving a
fair estimate of the reasonable and incremental costs incurred by Adelphia in constructing
and installing the institutional network required by Section XIII of the Adelphia Franchise,
and (2) multiplying that amount by fraction, the numerator of which shall be 394, and the
denominator of which shall be the sum of 394 plus the number of Adelphia subscribers at
year-end 2003. The I-Net Substitute Payment shall be used exclusively for (1) facilities,
equipment and support for PEG access operations in the Town; and/or (2) defraying costs
incurred by the Town in expanding or operating the institutional network provided by
Adelphia pursuant to Section XIII of the Adelphia Franchise.
12
B. Franchisee agrees that it shall not deduct the I-Net Substitute Payment from
the franchise fee.
XIV.
INTERCONNECTION.
A. PEG Interconnect and Carriage. Within 90 days of the effective date hereof,
Franchisee shall carry the same PEG access channels on its system as Adelphia carries
on its cable system in the Town. Franchisee may accomplish such carriage in the manner
that, in its reasonable judgment, is most economically feasible, provided that all PEG
channels are carried and that the signal quality of such channels on Franchisee's system is
satisfactory and not inferior to that of other non-PEG channels carried on its system. If
Franchisee's PEG channel carriage is to be accomplished through interconnection with
Adelphia's system, the Town shall, to the extent that it can, consistent with Section 5.1-25
of the Ordinance and other applicable law, require Adelphia to accommodate any
reasonable request by Franchisee to interconnect to Adelphia's system for the purpose of
carrying the PEG channels, provided that Franchisee shall be responsible for extending its
system, at its cost, to the nearest feasible point of interconnection with Adelphia's system
("Demarcation Point"), and shall be responsible for paying Adelphia the reasonable and
customary direct costs that Adelphia incurs to interconnect Franchisee to Adelphia's
system at that Demarcation Point. Franchisee shall not be obligated to pay Adelphia any
programming, transport or carriage fees for any of the PEG channels that it receives from
Adelphia's system.
B. Interconnection with Other Systems. Franchisee agrees to allow the
originating institutions on the cable system to interconnect the PEG access channels on
Franchisee's Town system with other cable systems in Loudoun County.
XV.
NON-DISCRIMINATION.
Franchisee agrees that it shall not discriminate in providing service to the public nor
against any employee or applicant for employment because of race, color, creed, religion,
sex, disability, national origin, age, or marital status. In the employment of persons,
Franchisee shall fully comply with applicable local, State and Federal law.
XVI. RATES.
A. Rate Regulation. The Town shall have the ability to regulate rates in
accordance with Federal law.
13
B. Rate Schedule. Franchisee shall maintain a copy of its current rate schedule
on file with the Town, and shall notify the Town Manager, the Cable Commission and cable
subscribers at least thirty (30) days in advance of the effective date of any changes in the
rate schedule.
XVlI.
FRANCHISE RENEWAL.
Subject to Section 626 of the Cable Television Consumer Protection and
Competition Act of 1992, as amended, this Franchise Agreement and the Ordinance may
be renewed.
XVIII.
POLICE POWERS.
In accepting this Franchise Agreement, Franchisee acknowledges that its rights
hereunder are subject to the police powers of the Town to adopt and enforce general
Ordinances necessary to the safety and welfare of the public, and it agrees to comply with
all applicable general laws and Ordinances enacted by the Town pursuant to such power.
XlX.
FRANCHISE FEE AND PERFORMANCE BOND.
A. Franchise Payments. Franchisee shall pay to the Town a franchise fee of
five percent (5%) of gross annual revenues or the maximum amount permitted by law,
whichever is higher, during the period of its operation under the Franchise, pursuant to the
provisions of the Ordinance. Franchisee's gross revenues subject to the fee shall include
any and all sums collected directly or indirectly by Franchisee pursuant to any bulk services
arrangements with any homeowners associations in its Limited Service Area, but only to
the extent of revenues attributable to the provision of cable services. Any increase in the
franchise fee shall be implemented as soon as practicable, but no longer than forty-five
(45) days. Franchise fee payments shall be made not later than thirty (30) days following
the end of each calendar quarter.
B. Security Fund and Bond. Franchisee shall furnish the Town with a cash
security fund in the amount of $15,000 pursuant to Section 5.1-45 of the Ordinance.
Franchisee shall also furnish a combined construction and performance bond to the Town
as specified in the Ordinance in the amount of $5,000. The bond shall be replenished
within ten (10) days of use by the Town as specified in the Ordinance. Franchisee shall
provide such bond to the Town within thirty (30) days of the effective date of this Franchise
Agreement. The bond shall be maintained during the life of the Franchise, to guarantee
the faithful performance of all of Franchisee's obligations under this Franchise Agreement
and the Ordinance.
14
XX. REGULATION.
A. Regulatory Authority. The Town shall exercise appropriate regulatory
authority under the provisions of the Ordinance and this Franchise Agreement. Regulation
may be exercised through the Town Manager or his designee.
B. Acceptance. Franchisee, by accepting the rights hereby granted, agrees that
it will perform and keep all acts and obligations imposed, represented or promised by the
provisions of this Franchise Agreement and the Ordinance.
C. Cable TV Advisory Commission Meetings. Upon request, Franchisee shall
attend all meetings of the Leesburg Cable TV Advisory Commission. Whether it attends
such meetings or not, Franchisee shall provide monthly operations reports on: Subscriber
Activity Report; New Cable Plant Report; Service Call Report; Outage Report; Daily
Telephone Statistics; and CyberCable Statistics.
D. FCC Cablecasting Regulations. That Franchisee agrees to abide by the
Federal Communications Commission regulations regarding political candidates, the
fairness doctrine, and political editorials.
E. Open Access. The Franchisee agrees to comply with all lawful Federal, State
and local requirements with respect to open access to the Franchisee's cable modem
platform for providers of Internet service, and if Franchisee provides open access in any
other market owned by the Franchisee or subsidiary company, Franchisee will provide
open access on Leesburg when economic and technical issue make it practical and
profitable to do so.
XXl. REMEDIES.
A. Schedule of Liquidated Damages. Because Franchisee's failure to comply
with provisions of this Agreement and the Ordinance will result in injury to the Town or to
subscribers, and because it will be difficult to estimate the extent of such injury, the Town
and Franchisee hereby agree that the liquidated damages and penalties stated in the
Ordinance represent both parties' best estimate of the damages resulting from the
specified injury.
B. Violations. For the violation of any of the following, the Town shall notify
Franchisee in writing of the violation. The Town shall provide Franchisee with a detailed
written notice of any Franchise violation upon which it proposes to take action, and there
shall be a thirty (30) day period within which Franchisee may demonstrate that a violation
15
does not exist or cure an alleged violation or, if the violation cannot be corrected in thirty
(30) days, submit a plan satisfactory to the Town to correct the violation. If an alleged
violation is proven to exist and no cure or action on a plan acceptable to the Town has
been received by the Town within thirty (30) days, such liquidated damages shall be
chargeable to the performance bond as set forth in the Ordinance, if not tendered by
Franchisee within thirty (30) days. Franchisee may petition the Town Council or make any
other appeal available.
(1)
For failure to complete construction or extend service in accordance with
Franchise: $300/day for each day the violation continues;
(2)
For failure to comply with requirements for public, educational and
government access: $150/day for each day the violation continues;
(3)
For failure to submit reports, maintain records, provide documents or
information: $75/day for each day the violation continues;
(4)
For violation of customer service standards required by this Franchise
Agreement, the Ordinance, or by FCC regulation: $75/day per standard
violated;
For violation of the books and financial records provisions of this Franchise
Agreement and the Ordinance: up to $150/day for each day the violation
continues; and
(6)
For violation of other provisions of this Franchise Agreement or the
Ordinance: up to $200/day for each day the violation continues.
XXll.
COOPERATION.
The parties recognize that it is within their mutual best interests for the cable
television system to be operated as efficiently as possible in accordance with the
requirements set forth in this Agreement. To achieve this, parties agree to cooperate with
each other in accordance with the terms and provisions of this Franchise Agreement.
Should either party believe that the other is not acting timely or reasonably within the
confines of applicable regulations and procedures in responding to a request for action,
that party shall notify the person or agents specified herein. The person or agent thus
notified will use its best effort to facilitate the particular action requested.
XXlII. WAIVER.
16
The failure of either party at any time to require performance by the other party of
any provision hereof shall in no way affect the right of either party hereafter to enforce the
same. Nor shall the waiver by either party of any breach of any provision hereof be taken
to be a waiver of any succeeding breach of such provision, or as a waiver of the provision
itself.
XXIV.
CUMULATIVE PROVISION.
The rights and remedies reserved to either party by this Franchise Agreement are
cumulative and shall be in addition to and not in derogation of any other rights or remedies
which that party may have with respect to the subject matter of this Franchise Agreement,
and a waiver thereof at any time shall have no effect on the enforcement of such rights or
remedies at a future time.
XXV. NO LIABILITY.
Except as otherwise provided in this Franchise Agreement, including without limitation
the indemnification provisions of Section I(E) hereof --
nothing in this Franchise Agreement shall be deemed to create civil liability by one
party for the action, omissions or negligence of the other party, or of a party's agents,
employees, officers or assigns, and each party shall be solely liable for claims against it by
third parties, whether arising under the Cable Television Consumer Protection and
Competition Act of 1992 or under any other provision of law.
XXVI. NOTICES.
All notices from Franchisee to the Town pursuant to this Agreement shall be sent to
the following address for the conduct of matters related to the Franchise. All notices to the
Town should be sent to: Town Manager, Town of Leesburg, P.O. Box 88, Leesburg, VA
20178. All notices to Franchisee shall be sent to Lamont Digital Systems, Inc., at 35
Mason Street, Greenwich, CT 06830.
XXVlI. CAPTIONS,
Captions to sections throughout this Franchise Agreement are solely to facilitate the
reading and reference to the sections and provisions of the Agreement. Such captions
shall not affect the meaning or interpretation of the Agreement.
17
XXVIII.
NO JOINT VENTURE.
Nothing herein shall be deemed to create a joint venture or principal-agent
relationship between the parties, and neither party is authorized to, nor shall either party
act toward third persons or the public, in any manner, which would indicate any such
relationship with the other.
XXlX.
ENTIRE AGREEMENT.
This Agreement and all attachments hereto, and the Ordinance and all attachments
thereto, as incorporated herein, represent the entire understanding and agreement
between the parties hereto with respect to the subject matter hereof, supersede all prior
oral negotiations between the parties, and can be amended, supplemented, modified, or
changed only as provided in said Ordinance or in writing and signed by both parties.
XXX.
SEVERABILITY.
If any section, subsection, sentence, clause, phrase, or portion of this Agreement is,
for any reason, held invalid or unconstitutional by any court of competent jurisdiction, such
portion shall be deemed a separate, distinct, and independent provision and such holding
shall not affect the validity of the remaining portions of this Agreement, except as provided
for in the Ordinance.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
as of the day and year first above written.
ATTEST:
TOWN OF LEESBURG, VIRGINIA
Witness Mayor
Date
LAMONT DIGITAL SYSTEMS, INC.
18
Witness
[Title]
Date
Seal
Approved as to form and correctness.
Town Attorney
19
APPENDIX A
[Description and map of Edwards Landing Service Area.]
WALIB:94147.2\122773-00001
DRAFF 03/04/04 11:40 AM