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for that calendar year. Each payment shall be accompanied by a detailed summary explaining the basis for the calculation of the state franchise fee and PEG support fee. Payments shall be sent to the Santa Ana Parks, Recreation and Community Services Agency. d. Gross revenue, for the purposes of (a) and (b) above, shall have the definition set forth in California Public Utilities Code §5860. e. Not more than once annually, the City Manager or his designee may examine and pertorm an audit of the business records of a State franchisee(s) to the extent reasonably necessary to ensure compliance with the Act and this Ordinance. Section 15.272 "Customer Service Penalties Under State Video Franchises" a. The holder of a state video franchise shall comply with all applicable state and federal customer service and protection standards pertaining to the provision of video services. b. The city manager, or the city manager's designee, shall monitor the compliance of State Franchisee's with respect to state and federal customer service and protection standards. The city manager will provide the State Franchisee written notice of any material breaches of applicable customer service standards, and will allow the State Franchisee 30 days from the receipt of the notice to remedy the specified material breach. Material breaches not remedied within the 30-day time period will be subject to the following penalties to be imposed by the City: (1) For the first occurrence of a material breach, a fine of $500.00 shall be imposed for each day the material breach remains in effect, not to exceed $1,500.00 for each material breach. (2) For a second material breach of the same nature within 12 months, a fine of $1,000.00 shall be imposed for each day the violation remains in effect, not to exceed $3,000.00 for each material breach. (3) For a third or further violation of the same nature within 12 months, a fine of $2,500.00 shall be imposed for each day the material breach remains in effect, not to exceed $7,500.00 for each occurrence of the material breach. c. Decisions by the city manager to assess monetary penalties against a State franchisee are final. The State franchisee or any person aggrieved by a decision of the city manager may appeal that decision in writing to the city council in accordance with the procedures specified in chapter 3 of this Code. The appeal letter must be accompanied by the fee established by the city council for processing the appeal. d. Any fine imposed on a State franchisee shall be paid to the City. As provided for in the California Public Utilities Code §5900(g), the City shall submit one half of all fines received from a state video franchise holder to the Digital Divide Account established by California Public Utilities Code §280.5. Ordinance No. NS-2774 Page 7 of 9