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Supporting Documentation
REQUEST FOR COUNCIL ACTION PREPARED By Richard E. Lay _ DATE 1OZ2 5 78 PHONE 834 -4900 SUBJECT Ordinance Revision of CATV Regulations MS -N-L 1 APPR DEPIiTY CITY MAN A77RR R. 2 Y DATE OF COUNCI L ACTION C. Iy %JP It -21TY MANAGER CLERK 6F THE C NCIL RECOM W ND`rD AC[10N Place on first reading and authorize publication of title. BACKGROUND CATV ( "Community Antenna Television "), also known as "Cable Television ", is a system by which television signals are transmitted to subscribers throughout a service area by cables running from a central receiver, as an alternative to individual antenna reception. CATV should be distinguished from the term "pay television" which refers to a special charge for particular program or channel reception. Both CATV and regular airwave television can provide "pay television" programming, along with ordinary commercial channels. State law authorizes cities to grant franchises for CATV systems, and cities also have the inherant right to regulate the use of their streets through franchises. Santa Ana adopted an ordinance regulating CATV franchises in 1968 (Chapter 15, Article 2). No such franchise has been granted, however, presumably because, until now, no CATV operator considered it feasible to operate in an area which receives quite adequate airwave reception. Six Star Cablevision, Inc., however, represents that, due to advances in CATV technology,CATV can be commercially successful even in major broadcast areas such as the greater Los Angeles region. It hopes to obtain franchises from many cities in the region, including Santa Ana. The present City ordinance regulating CATV franchise is recommended for revision for the following reasons: 1. It prohibits "pay television" programming. This prohibition reflects the "Free Television" initiative of 1964, which was subsequently held unconstitutional on First Amendment grounds. Pay television is now available by airwave transmission through the "scrambler" technique. It also appears to be the major commercial incentive for CATV in this area. 2. It requires the Council to fix subscriber rates through periodic public hearings. Such rate control is normal in areas where CATV is in a monopoly position due to lack of airwave reception. In this area, however, there is a multiplicity of airwave channels, VHF and UHF, including specialty channels and "pay television." It appears more than likely that competitive pressures from airwave television will require a CATV operator to offer reasonable service at reasonable prices, without the need for municipal regulation. Furthermore, the City needs flexibility in drafting franchise grants for CATV in the future, both because the technology of CATV is rapidly developing, and because federal regulation of CATV is in a state of great uncertainty and change. �:UT!ON J� Z . r City Manager October 25, 1978 Page 2 The proposed ordinance would therefore limit the Municipal Code regulations of CATV to (a) establishing the requirement for a franchise to operate a CATV system in the City, and (b) establishing the procedure for receiving and deciding CATV franchise applications. The details of any particular CATV franchise would thereafter be set by a second ordinance granting the specific franchise for a specified term of years, once the nature of the applicant's proposal is known. (We have prepared a draft franchise ordinance for Six Star Cablevision. No action is requested on this second ordinance at the present time, but it is available for Council review.) FINANCIAL IMPACT There is no financial impact from the proposed ordinance revising the Municipal Code CATV franchise regulations. If in the future a franchise is granted, it will be a source of City revenue, since the City will be entitled to a license fee (2% of gross income is proposed in the draft franchise ordinance for Six Star). On the other hand, if the City should undertake to regulate a CATV operator's rates, services, and business practices (which is not proposed), the City would have to meet the cost of administering such regulations out of the franchise fee revenues. RICHARD E. LAY Deputy City Attorney REL:ms 2 RE ' 10 /78 t t " � • 1 � �- �sti.aS7�— ORDINANCE NO. NS -1461 AN ORDINANCE OF THE CITY OF SANTA ANA AMENDING ARTICLE II OF CHAPTER 15 OF THE SANTA ANA MUNICIPAL CODE TO REVISE THE REGULATIONS PERTAINING TO FRANCHIS FOR COMMUNITY ANTENNA TELEVISION SYSTE THE CITY COUNCIL OF THE CITY OF SANTA ANA DOES ORDAIN AS FOLLOWS: SECTION 1: That Section 15 -250 of the Santa Ana Municipal Code, is hereby amended to read as follows: Sec. 15 -250 Definitions For purposes of this article, the following words, terms, phrases, abbreviations, and the derivatives of any thereof, shall have the meanings set forth herein: (a) "CATV" stands for Community Antenna Television System and shall mean a nonbroadcast facility consisting of a set of transmission paths and associated signal generation, reception, and control equipment, under common ownership and control, that distributes or is designed to distribute to subscribers the signals of one or more television broadcast signals, but such term shall not include (1) any such facility that serves fewer than 50 subscribers, or (2) any such facility that serves or will serve only subscribers in one or more multiple dwellings units under common ownership, control, or management. (b) "Grantee" shall mean the person or organization to whom or which a franchise is granted by the City Council pursuant to this Article, and the lawful successor or assignee thereof. (c) "Service area" shall mean the area in which the grantee is permitted to provide subscribers with CATV service pursuant to a franchise granted under the provisions of this article. (d) "Street" shall mean the surface of, and the space above and below, a public street, road, highway, lane, alley, court, sidewalk, easement, parkway or drive now or hereafter existing as such within the City. (e) "Subscriber" shall mean any person receiving for any purpose any CATV service provided by a grantee. SECTION 2: That Section 15 -251 of the Santa Ana Municipal Code, is hereby amended to read as follows: Sec. 15 -251 Purpose of Article It is hereby declared and determined that the business of establishing and /or operating a CATV system for the purpose of supplying any person in the City of Santa Ana with televisions signals or radio signals by means of such CATV system or inhabitants of the said City, is in the nature of a public utility and, as such, should be regulated by the City. Also, the use of any public street or public property, or of any area proposed to be a public street for any of the above purposes is of great concern to the City and should be regulated by the City. It is the purpose of this Article to provide such'regulation. 2f� ORDINANCE NO. NS -14 PAGE TWO SECTION 3: That Section 15 -252 of the Santa Ana Municipal Code, is hereby amended to read as follows: Sec. 15 -252. Activities which are Unlawful Unless Authorized by City Franchise. It shall be unlawful for any person to establish or operate any community antenna television system in the City unless a francise therefor has first been obtained pursuant to the provisions of this Chapter, and unless such franchise is in full force and effect. It shall also be unlawful for any person to construct, install or maintain within any public street in the City, or within any other public property of the City, or within any privately owned area within the City which has not yet become a public street but is designated or delineated as a proposed public street on any tentative subdivision map approved by the City, any equipment or facilities for distributing television signals or radio signals through a community antenna television system, unless a franchise authorizing such use of such street, property or area has first been obtained pursuant to the provisions of this Article, and unless such franchise is in full force and effect. SECTION 4: That Section 15 -253 of the Santa Ana Municipal Code, is hereby amended to read as follows: Sec. 15 -253. Authority of Council to Grant Franchises. Whenever it deems such to be for the public good, the Council, subject to the provisions of Article XIII of the Charter of the City, may and is hereby empowered to grant, by ordinance, to any person, whether operating under an existing franchise or not, a non - exclusive franchise to operate or carry on the business of distributing to people in the City, or to people in a certain area or areas in the City, television signals or radio signals by means of a community antenna television system, and /or to construct, install or maintain within specified public streets in the City, or within other specified public property of the City, or, subject to approval of the owner of such private area, within any privately owned area in the City which has not yet become a public street but which is designated or delineated as a proposed public street on any tentative subdivision map which has been approved by the City any equipment or facilities for distributing television signals or radio signals by means of a community antenna television system. SECTION 5: That Section 15 -254 of the Santa Ana Municipal Code, is hereby amended to read as follows: Sec. 15 -254. Terms and Conditions. All franchises issued hereunder shall be non- exclusive. No provision of this Article shall be deemed to require restricting the number of franchises to one or any particular number and no provision of this Article shall be deemed to prohibit or prevent the Council from refusing to grant any franchise or franchises if and whenever it finds or believes that the grant of any such franchise or franchises is not for the public good. All franchises shall be subject to terms and conditions specified in the Charter of the City of Santa Ana and to terms and conditions specified in this Article. Also, in granting any franchise, the Council may prescribe such other and additional terms and conditions, not in conflict with said Charter or this Article, whether governmental or contractural in character,'as in the judgment of the Council are in the public interest. -2- 26 ORDINANCE NO. 1462 PAGE THREE 0 SECTION 6: That Section 15 -255 of the Santa Ana Municipal Code, is hereby amended to read as follows: Sec. 15 -255. Applications for Franchises. All applications for franchises under the provisions of this Article shall be in writing, and shall be filed in the office of the City Clerk. Each application for a franchise shall contain the following information: (a) The name and address of the applicant. If the applicant is a partnership, the name and address of each partner shall also be set forth. If the applicant is a corporation, the application shall also state the names and addresses of its directors, main offices, major stockholders and associates, and the names and addresses of parent and subsidiary companies. (b) A statement of the type of franchise applied for, and a general description of what the applicant proposes to do pursuant to the requested franchise. (c) A statement and description of the CATV system proposed to be constructed, installed, maintained or operated by the applicant; the proposed location of such system and its various components; the manner in which applicant proposes to construct, install, maintain and operate the same; and, particularly, the extent and manner in which existing or future poles or other facilities of other public utilities will be used for the system. (d) A financial statement prepared by a certified public accountant, or otherwise satisfactory to the Council, showing applicant's financial status and his financial ability to complete the construction and installation of his proposed CATV system. (e) A statement setting forth all agreements and understandings, whether written, oral or implied, existing between the applicant and any person, firm or corporation with respect to the proposed franchise or the proposed CATV operation. If a franchise is granted to a person, firm, group or corporation posing as a front or as the representative of another person, firm, group or corporation, and such information is not disclosed in the original application, such franchise shall be deemed void and of no force and effect whatsoever. The Council may at any time demand, and the applicant shall provide, such supplementary, additional or other information as the Council may deem reasonably necessary to determine whether the requested franchise should be granted. SECTION 7: That Section 15 -256 of the Santa Ana Municipal Code, is hereby amended to read as follows: Sec. 15 -256. Resolution Giving Notice of Application And Of Time and Place of Hearing Thereon. Upon receiving an application for a franchise under the provisions of this Article, the City Clerk shall present the same to the Council at the next regular meeting. The Council shall thereupon, or within a reasonable time thereafter, set the application for hearing in accordance with Section 1303 of the City Charter. -3- AFON ORDINANCE NO. NS-.' 1 _ PAGE FOUR SECTION 8: That Section 15 -257 of the Santa Ana Municipal Code, is hereby amended to read as follows: Sec. 15 -257. Hearing of Application. At the hearing on an application for a franchise, the Council shall give all persons desiring to be heard a reasonable opportunity to present evidence or to be otherwise heard in favor of or in opposition to the granting of a franchise to the applicant. At such hearing, the Council may demand such additional information as it may deem relevant and necessary. The hearing may be continued or adjourned, from time to time, to a stated time and place without the giving of further notice. SECTION 9: That Section 15 -258 of the Santa Ana Municipal, is hereby amended to read as follows: Sec. 15 -258. Council's Decision on Application. Upon conclusion of the hearing on the application for a franchise, or within a reasonable time thereafter, the Council shall render its decision thereon. If it deems such action to be for the public good, it may refuse to grant the requested franchise, or it may, by ordinance, grant the same, or it may, by ordinance, grant such other CATV franchise as it may deem to be for the public good, subject to such terms, conditions, rules, regulations, restrictions and limitations, governmental or contractural in nature, as it may deem advisable to protect individual subscribers to the services of the CATV system, to preserve the rights, interests and liability of the City in its streets and public places, and to otherwise protect the interests of the City and its people. In making its decision, the Council shall consider the applicants legal, character, financial, technical, and other qualifications, and the adequacy and feasibility of its construction arrangements; and any other consideration that will safeguard the City's public interest. The CATV franchise granted by the Council to the applicant need not be identical to or the same as that requested by applicant, but may vary or be different therefrom. For example, the rights or privileges granted thereby may be less or more limited than those requested by applicant. No franchise shall be granted except by ordinance. No franchise shall become effective unless and until accepted by the grantee. SECTION 10: That Section 15 -259 of the Santa Ana Municipal Code is hereby amended to read as follows: Sec. 15 -259. Acceptance of Franchise. Within twenty -five (25) days after the effective date of the ordinance awarding a franchise, or within such extended period of time as the Council in its discretion may authorize, the successful applicant or grantee shall file with the City Clerk his written acceptance, in form satisfactory to the City Attorney, of the franchise, stating his agreement to be bound by and to comply with and to do all things required of him by applicable provisions of the City's Charter, provisions of this Chapter and provisions of the franchise. Such acceptance and agreement shall be acknowledged by the successful applicant before a notary public, and shall in form and content be satisfactory to and approved by the City Attorney. -4- ORDINANCE NO. N #61 PAGE FIVE is SECTION 11: That section 15 -260 of the Santa Ana Municipal Code is hereby amended to read as follows: Sec. 15 -260. Misdemeanors (a) It shall be unlawful for any person, firm or coporation to make any'unauthorized connection in physical contact with any part of a franchise CATV system within this City for the purpose of taking or receiving television signals, radio signals, pictures, programs, or sound. (b) It shall be unlawful for any person, firm or corporation to make any unauthorized connection in physical contact with any part of a franchised CATV system within this City for the purpose of enabling himself or others to receive any television signal, radio signal, picture, program or sound, without payment to the owner of said system. (c) It shall be unlawful for any person, without the consent of the owner, to willfully tamper with, remove or injure any cables, wires or equipment used for distribution of television signals, radio signals, pictures, programs or sound. SECTION 12: Sections 15 -261, 15 -262, 15 -263, 15 -264, 15 -265, 15 -266, 15 -267, 15 -268, 15 -269, 15 -270, and 15 -271 of the Santa Ana Municipal Code are hereby repealed. SECTION 13: If any section, subsection, sentence, clause, phrase or portion of this ordinance is for any reason held to be invalid or unconstitutional by the decision of any court of competent jurisdiction, such decision shall not affect the validity of the remaining portions of this ordinance. The City Council of the City of Santa Ana hereby declares that it would have adopted this ordinance and each section, subsection, sentence, clause, phrase or portion thereof irrespective of the fact that any one or more sections, subsections, sentences, clauses, phrases, or portions be declared invalid or unconstitutional. ADOPTED this „day of tLbU$lri6GCL4 1978, by the following vote: AYES: COUNCILMEN: LLjpfRD I "I C} wM@ ra Rgh.1�i �V ptCl� NOES: COUNCILMEN: r%:rpNE' ABSENT: COUNCILMEN: ATTEST: CLERK OF THE COUNCIL APPROVED AS TO FORM: KEITH L. GOW, City Attorney 13 ttt cJVatU � C.Pr CLT-44 E ( C.IRr % Z -5- MAYOR nme REQUEST FOR COUNCIL ACTION O� SA)V n Y PREPAREDRY Richard E. Lay, Dep. City Atty. DATE 9/7/79 PHONE 834 -4900 SUBJECT AMENDMENT OF CABLE TV FRANCHISE PROCEDURES. APPHOV� DEPA RiMEN HEAD DEPl1TY CITY MANAGER RECOMMENDED ACTION : Adoption DATE OF COl)NCII_ ACTION 71 !!1 A ASSISTANT CITY MANAGER RK GF THE C UNCI L BACKGROUND: At its August 20 meeting, the City Council directed the City Attorney to prepare an amendment to the Cable TV franchise application procedures in the Municipal Code, to establish a competitive Request for Proposals format with consultant costs to be covered by application fees. This ordinance is submitted in response to that direction. ANALYSIS: The amendment limits the filing franchise applications to a period set by the Council for responses to a Request for Proposals. It authorizes the Council to set the fee at the time the Request for Proposals is issued. The City Charter requires a franchise grant of this type to be in the form of an ordinance, and requires a public hearing on any proposed franchise grant to a specific grantee. The procedures established by this amendment, therefore, are designed to select a "proposed grantee" from among the various cable TV companies who submit proposals. The Charter - mandated ordinance and hearing will then be directed to the "proposed grantee." Of course, the Council will be free to hold public hearings during the process of selecting a "proposed grantee" if it wishes to do so. SELECTION OF A CONSULTANT: Following adoption of this amendment, staff will proceed to make inquiries of professional consultants for the purpose of drafting Requests for Proposals and evaluating applicants. Two California - based firms, Alta California Services, Inc. and Telecommunications Management Corp., have served as consultants to the cities of Anaheim and Orange respectively and both are highly recommended by staff members in those cities. Other firms may also be considered, but staff feels we should restrict selection of a consultant to California -based firms in order to promote accessibility. Unless the Council prefers otherwise, staff will proceed ahead to prepare a draft consultant agreement with the firm it feels can best serve the City's needs. The Council may wish to designate one or more of its members to participate in the review of consultants. \_UTIpN 6 2 /�Z 26 v M b �d REL - CA 30 - y� ORDINANCE NO. NS- 1504 AN ORDINANCE OF THE CITY OF SANTA ANA AMENDING SECTIONS 15 -255 AND 15 -256 OF THE SANTA ANA MUNICIPAL CODE TO ESTABLISH A COMPETITIVE PROPOSALS PROCEDURE FOR THE REVIEW OF CABLE TELEVISION FRANCHISE APPLICATIONS THE CITY COUNCIL OF THE CITY OF SANTA ANA DOES ORDAIN AS FOLLOWS: SECTION 1: That section 15 -255 of the Santa Ana Municipal Code is hereby amended to read as follows: Sec. 15 -255. Applications for franchises. No applications for a franchise under the provisions of this Article shall be filed except during such time as the council directs the solicitation of competitive proposals from prospective applicants in accordance with a written Request for Proposals approved by the council. The council may set a fee to be charged to each applicant as a condition to the filing of an application. In addition, it may require that a grantee of a franchise reimburse the City for costs incurred in the administration of the application process to the extent they may exceed application fee revenues. Each application shall be filed at the place and in the manner specified in the Request for Proposals, shall contain all information and documentation and the proposal description required by the Request for Proposals, and shall be accompanied by the required application fee. The council, or such officer as it may designate, may at any time demand from any applicant such additional information as is reasonably necessary to determine whether the franchise should be granted to such applicant. SECTION 2: That section 15 -256 of the Santa Ana Municipal Code is hereby amended to read as follows: Sec. 15 -256. Selection of proposed grantee. After the close of the period for filing of appli- cations, the council shall proceed to select one applicant as the proposed grantee and shall cause to be prepared a proposed ordinance granting the franchise to such applicant and setting forth the terms, conditions, and covenants pertaining thereto. Such selection may be made on the basis of quality of service to the public, experience, reputation, and financial reponsibility of the applicant, adequacy and feasibility of construction arrangements, income to the City, and any other consideration which will safeguard the public interest. Thereafter, the council shall set the proposed ordinance for hearing in accordance with section 1303 of the charter. The resolution required by that section shall contain a brief summary of the terms and conditions of the proposed franchise grant and shall state that the complete text of the proposed ordinance is available for public inspection in the office of the Clerk of the Council. ■ ORDINANCE NO. NS 4 PAGE TWO w If the final decision of the council is to reject the grant of a franchise to the proposed grantee, the council may proceed to select a new proposed grantee pursuant to this section from the other applicants, or may solicit new proposals, as the council deems appropriate. At any stage of the application process, the council may determine not to grant any franchise and discontinue further proceedings. ADOPTED this lst day of October 1979, by the following vote: AYES: COUNCILMEN: Bricken, Griset, Luxembourger, Markel, Serrato, Ward, Yamamoto NOES: COUNCILMEN: None ABSENT: COUNCILMEN: None ATTEST: ` MAYOR LERK OF THE COUNCIL APPROVED AS TO FORM: KEITH L. GOW, City Attorney REGMEST FOR COUNCIL ACTION tiA.N y. q r. F U Kam\ P PREPARED BY Richard E. Lay, Dep. City Atty. DATE May 221 1979PHONE SUBJECT 714/834 -4900 CABLE TELEVISION FRANCHISE APPLICATION OF SIX -STAR CABLEVISION, INC. DATE OF COUNCI f_ ACTION C E - IKof,HECO;NCIL RECUMMENDEO AC:rION : That, at the conclusion of the public hearing, the Council take t e following actions: 1. Deny Six -Star Cablevision's current application, with an invitation to Six -Star Cablevision to renew its application at such time as the Council may request proposals in a competitive format from all interested cable television operators. 2. Instruct the City Attorney to prepare an amendment to the Municipal Code to limit cable television franchise applications to a competitive "request for proposals" format under the following conditions: (a) No applications to be received until such time as the council directs that proposals be requested. (b) An application fee to be required in an amount sufficient to cover the costs to the City of retaining a professional consultant for the evaluation of applicants and other expenses incidental to the processing of applications. BACKGROUND: CATV ( "Community Antenna Television "), also known as "Cable Television ", is a system by which television signals are transmitted to subscribers throughout a service area by cables running from a central receiver, as an alternative to individual antenna reception. CATV should be distinguished from the term "pay television" which refers to a special charge for particular program or channel reception. Both CATV and regular airwave television can provide "pay television" programming, along with ordinary commercial channels. Six -Star Cablevision filed an application for a CATV franchise last year. The application was set for hearing by the Council as an accomodation to Six -Star, which needed such an expression of interest by the City in 1978 for its own financial reasons. The hearing has been continued from time to time to allow for consideration of the question of the extent to which undergrounding of cables should be required. Six -Star has filed a draft report which states that it is financially infeasible for it to underground its cables except in areas and developments where other utility lines are required to be undergrounded. (All cable television companies string their overhead cables by leasing space from telephone and electric power utilities, thus using the preexisting utility poles to the extent possible) In the past month or so, numerous other cable television companies have expressed a similar interest in obtaining a franchise. One of these, American Television & Communications Corp. (ATC), has expressed the intent to file an application in the near future. In view of the previous, long- standing lack of interest in Santa Ana as a possible cable television market, this sudden rush of potential applicants was not anticipated by staff. � _urraH m b mil' Mast `2 1979 T M t��9e Two ANALYSIS: The City of Santa Ana, unlike other cities and areas where cable television now exists, has quite adequate antenna reception in all parts of the City, including several specialty UHF stations and two "pay television" channels using the scrambler technique. While television itself might be considered a necessity in the American life - style, cable television services can still be viewed as a luxury item in an area of such wide -scale airwave channel reception as Santa Ana. Santa Ana can therefore afford to take its time in deciding whether to grant a franchise and, if so, in obtaining the best possible franchisee. Six -Star and the other potential franchise applicants believe that industrial advances (primarily satellite transmission) now enable cable companies to offer such a wide diversity of channels and premium pay television programming as to make cable television competitively successful even in areas of adequate and diverse antenna reception. Applicants are willing to take the risk of incurring substantial initial cabling expen- ditures in the expectation of long -term financial success. Cable television can also offer supplemental services such as local access cablecasting and alarm systems. It should also be noted that the annual franchise fee could be a moderate source of revenue for the City if the business is in fact successful. Six -Star and the other interested companies desire a City -wide franchise, and, indeed, there seems to be no reason to grant more than one franchise or to parcel the City up into regional franchises. Staff therefore recommends that the cable television franchise question be addressed through a competitive "request for proposals" format, and that a professional telecommunications consultant be retained, to be paid for solely out of application fees. This is the approach now being taken by the City of Orange. This approach will require some modification of current code provisions. It also calls for the denial at the present time of Six - Star's application. Six -Star may, of course, renew its application at such time as the Council calls for proposals. POLICY QUESTION: The Director of Public Works is disinclined to recommend allowing additional overhead wiring in the City. He thus recommends against any franchise grant, except under requirements for undergrounding which Six -Star says are financially infeasible. It is probably safe to say that no cable televisions operation can be obtained in Santa Ana unless the franchisee is allowed to use existing utility poles for overhead wiring and is required to go underground only in districts or developments where the other utility lines are undergrounded. The weighing and balancing of the aesthetic effect of additional overhead wiring and the benefits of cable television are value judgments which the City Council must ultimately make. While no decision is necessary at this point, expressions of preliminary opinions by individual councilmen would be helpful to staff. There is not much point in requesting proposals if a majority of the Council is opposed to the cabling of the City. Alter- natively, council members may wish to proceed full speed ahead, or to wait a few years to see how cable television progresses in neighboring cities. (In any event, staff would still recommend amendment of the municipal code now to establish the competitive format.) ALTERNATIVE ACTION: If the Council is disposed to proceed with a franchise grant to Six -Star without requesting proposals from other cable television companies, staff should be instructed to proceed with the preparation of a franchise grant ordinance. A draft ordinance has been prepared by this office but needs some refinement. No further public hearings are required, but they can of course be held if the Council so desires. i 22, 1979 Fa q Three r M DOCUMENTATION: The following materials have been placed in the Clerk's Office for review by those Councilmembers who may wish to study the cable television proposal more intensively at this time: 1. "Cable Television Proposal for City of Santa Ana" by Six - Star Cablevision, Inc. 2. "Draft Report, Undergrounding a Cable Television System within the City of Santa Ana, Six -Star Cablevision, Inc." Rutan & Tucker, William M. Marticorena. 3. "Proposed Franchise Grant to Six -Star Cablevision, Inc." (a tentative draft prepared by this office) 4. "City of Orange, Evaluation of Cable Television Franchise Applications, April 1979" by Telecommunications Management Corp. REL:ms [3J ORDINANCE NS -934 ADDING CHAPTER 4 TO ARTICLE VI OF THE SANTA ANA MUNICIPAL CODE TO PROVIDE FOR THE GRANTING OF FRANCHISES FOR COMMUNITY ANTENNA TELEVISION SYSTEMS AND FOR THE TERMS, CONDITIONS, AND LIMITATIONS UNDER WHICH ANY SUCH SYSTEM SHALL OPERATE WITHIN THE CITY OF SANTA ANA, CALIFORNIA THE CITY COUNCIL OF THE CITY OF SANTA ANA DOES ORDAIN AS FOLLOWS: SECTION 1: That in order to provide for the granting of franchises for Community Antenna Television Systems and for the terms, conditions, and limitations under which such systems shall operate within the City of Santa Ana, the Santa Ana Municipal Code is hereby amended by adding Chapter 4 to Article VI thereof to read in words and figures as follows: CHAPTER 4 -- FRANCHISES Part 1 -- Community Antenna Television Systems Section 6410. Definitions. For the purpose of this Part, the following words, terms, phrases, abbreviations, and the derivatives of any thereof shall have the meanings set forth herein. When not inconsistent with the context, words used in any particular tense, number, or gender include any other tense, number, and gender. The word "may" is permissive and not mandatory; the word "shall" is mandatory and not permissive: (a) "CATV" shall mean community antenna television system and shall include any and all systems, methods, facilities, and means wherein or whereby coaxial cables, wave guides, or other devices, equipment, or techniques are utilized, in whole or in part, for relaying or distributing television signals as a service or commodity as herein contemplated. "CATV" shall not include what is commonly referred to as "pay TV." (b) "CITY" shall mean the City of Santa Ana as now or at any time delineated. (c) "CITY MANAGER" shall mean the City Manager of the City of Santa Ana, California. (d) "CITY COUNCIL" shall mean the City Council of the City of Santa Ana, California. (e) "FRANCHISE AREA" shall mean the territory in which Grantee shall be authorized to construct, maintain, and operate its system. (f) "GRANTEE" shall mean any person, firm, or corporation receiving the grant of any franchise hereunder and shall include any lawful successor to the interest of such person, firm, or corporation. (g) "STREET" shall mean the surface of and the space above and below any public water, thoroughfare, street, highway, way, hereditament, or other such interest or place in which there is public control or direction as to the use or occupancy thereof, which now or hereafter shall exist within the City. (h) "SUBSCRIBER" shall mean any person or other entity within the City receiving for any purpose any CATV service of any grantee. -1- Section 6411. Authority Granted by Franchise. (a) Any franchise granted pursuant to the provisions of this Part shall authorize and permit the Grantee to do the following: (1) Erect, install, construct, repair, replace, reconstruct, maintain, and retain in, on, over, under, across, and along any public street such poles, wire, cable, conductors, ducts, conduit, vaults, manholes, ampli- fiers, appliances, attachments, and other property as may be necessary and appurtenant to the CATV system; and so to use, operate, and provide similar facilities or properties rented or leased from other persons, firms, or corporations, including, but not limited to, any public utility or other grantee of any franchise of this City; (2) Maintain and operate facilities and properties for the collection, transmission, conduction, amplification, conversion, and distribution of programs by use of electricity, micro -wave, or other energy source. (b) A franchise granted to provide service within the City shall authorize and permit the Grantee to solicit, sell, distribute, and make a charge to subscribers within the City for connection to the CATV system of Grantee, and shall authorize and permit the Grantee to pass over, across, or through any portion of the City in order to provide service outside the City. Section 6412. Franchise Requirements. In addition to any other franchise requirements hereunder, or made or adopted as herein provided, the following requirements shall apply to any franchise granted or renewed by the City Council under this Part. Section 6412.1. Franchise Payments; Operations Within City. The Grantee of any franchise to provide service within the City shall pay to the City, upon acceptance of such franchise, a fee certain in such amount as shall be approved by the City Council. In addition, for each period approved by the City Council, and at such times and in such manner as the City Council shall agree upon, the Grantee shall pay to the City, during the entire term of such franchise, one of the following sums as submitted in the Offer and Application for CATV Franchise and as ratified in the ordinance granting CATV franchise and franchise certificate, whichever is the greatest: (1) A fixed sum certain; or (2) A fixed percentage of the gross receipts of Grantee from subscribers within the City; or (3) A combination of (1) and (2) above. Any grantee traversing any portion of the City in order to provide service outside the City shall pay to the City such additional sums therefor at such times and in such manner as the City Council shall determine. Section 6412.2. Franchise Payments Not in Lieu of Taxes. Payments to the City by Grantee shall not be in lieu of any occupation, income, license, or property tax or similar levy, assessment, fee, or charge which would otherwise apply to and be payable by Grantee to the City, unless otherwise provided by ordinance. -2- Section 6412.3. Corporate Surety Bond Re City. Upon acceptance of such franchise, Grantee shall file with the Clerk of the Council, and shall thereafter during the entire term of such franchise maintain in full force and effect, a corporate surety bond or other adequate surety agreement in the principal amount and upon the conditions described in the specifications, for the benefit of the City. Section 6412.4. Corporate Surety Bond Re Subscribers. Upon acceptance of such franchise, Grantee shall file with the Clerk of the Council, and shall thereafter during the entire term of such franchise maintain in full force and effect, a corporate surety bond or other adequate surety agreement in the amount and upon the conditions described in the specifications, for the benefit of Subscribers. Section 6412.5. Comprehensive Liability Insurance. Upon acceptance of such franchise, Grantee shall file with the Clerk of the Council, and shall thereafter during the entire term of such franchise maintain in full force and effect, a general comprehensive liability policy of insurance providing coverage as described in the specifications. Section 6412.6. Construction, Installation, and Service Standards. (a) The City Council may from time to time establish and notify Grantee of reasonable standards governing the engineering, construction, installation, service, and maintenance of all CATV systems in the City, including bonding, grounding, clearances, cable and equipment attachments and installation, subscriber service drops, taps, connections, fuses, breakers, lightning arrestors, and other protective devices and facilities therefor. Grantee shall comply forthwith with such standards, upon notification. (b) The City shall have the right to make additional use, for any public or municipal purpose, whether governmental or proprietary, of any poles, conduits, or other facilities erected, controlled, or maintained exclusively by or for Grantee in any street, provided such use by City does not substantially interfere with the use by Grantee. (c) In the event the use of any part of the system of Grantee (1) is discontinued for any reason for a continuous period of one hundred and eighty (180) days without prior written notice to and approval by the City Manager, or (2) has been installed in any street or other area without complying with the requirements here- of, or (3) any franchise is terminated, cancelled, or shall expire, Grantee, at the option of the City and at the expense of Grantee and at no expense to the City, upon demand of the City Manager, shall promptly remove from any street or other area all property of Grantee, and Grantee shall promptly restore the street and other area from which such property has been removed to such condition as the Director of Public Works shall approve; provided, the City Manager may, upon written application therefor by Grantee, approve the abandonment of any of such property in place by Grantee and under such terms and conditions as the City Manager may prescribe; and upon abandonment of any such property in place, Grantee shall caused to be executed, acknowledged, and delivered to the City such instruments as the City Attorney shall prescribe and approve, transferring and conveying the ownership of such property to the City. -3- (d) Upon the failure, refusal, or neglect of Grantee to cause any work or other act required by law or hereunder to be completed properly in, over, on, or under any street within any time prescribed therefor, or upon notice given where no time is prescribed, the Director of Public Works may cause such work or other act to be completed in whole or in part, and, upon so doing, shall submit to Grantee an itemized statement of the costs thereof, and Grantee shall, within thirty (30) days after receipt of such statement, pay to the City the entire amount thereof. (e) Grantee shall be required to provide service to any person desiring to subscribe to such service in the City; provided, however, that the obligation of Grantee to provide service to isolated subscribers shall be subject to such terms and conditions as the City Council shall approve in the franchise of Grantee. (f) Unless otherwise provided in any given instance, where any time is prescribed herein for the doing or causing to be done of any act, the City Manager, for good cause, in writing, may extend any time so prescribed for two (2) additional periods of not to exceed ninety (90) days each. Section 6413. Franchise Limitations. In addition to any other franchise limitations hereunder or as herein provided, the following limitations shall apply to any franchise granted or renewed by the City Council under this Part. Section 6413.1. Nature of Franchise. Neither the granting of said franchise nor any of the provisions contained herein or in such franchise shall limit, abridge, diminish, alter, or affect the right, privilege, power, or authority of the City Council; and the City Council hereby reserves and preserves the right after the first two (2) full years to grant any identical or similar or different franchise to any person, firm, or corporation other than Grantee, either within or without the franchise area of any Grantee; provided . that the City Council shall not grant any franchise hereunder containing any terms or conditions which shall be less favorable to the City, or more favorable to any Grantee, than the terms or conditions of any other franchise hereunder. Section 6413.2. Transfer of Franchise. No franchise granted hereunder shall be sold, transferred, leased, assigned, or otherwise disposed of, in whole or in part, voluntarily or involuntarily, without the prior consent of the City Council, and then only upon such terms and conditions as the City Council may prescribe. No purchaser, lessee, assignee, or recipient of any such sale, transfer, lease, or assignment, without such prior written consent of the City Council, will acquire any of the rights of the franchise holder. am Section 6413.3. Term of Franchise. No franchise granted or renewed by the City Council under this Part shall be for a term shorter than five (5) years, unless terminated prior to its expiration as herein provided; nor shall any such franchise granted or renewed be for an aggregate term in excess of twenty -five (25) years. Section 6413.4. No Recourse Against City. Grantee shall have no recourse or remedy whatsoever against the City for any loss, cost, expense, or damage arising out of or with respect to any franchise hereunder, this Part, or the enforcement thereof. Section 6413.5. City Rules and Regulations. Grantee shall be subject to all ordinances, rules, regula- tions, and specifications of the City heretofore or hereafter established, including but not limited to those pertaining to works and activities in, on, over, under, and about streets. Section 6413.6. Prohibited Activities of Grantee. Grantee may not broadcast to subscribers any program or event for which broadcast a separate charge is made, whether by Grantee or any other person, firm, or corporation. The purpose of this provision is to preclude Grantee from engaging in that business commonly referred to as "Pay TV ". Section 6414. Adoption of Rules and Regulations. At all times during the term of any franchise granted hereunder,the +City Council shall have the power to, and shall adopt and enforce, and Grantee shall conform to, rules and regulations governing and establishing reasonable standards of performance pertaining to the system of Grantee. Section 6414.1. Rates and Charges. At the time of the granting of any franchise hereunder, the City Council shall approve and fix all rates and charges allowable to Grantee, including, but not limited to, all such rates and charges for installation of equipment; service charges for all classifications of service, including additional connections at one location; and any other rates or charges of Grantee to subscribers. No such rates or charges shall be changed at any time after the granting of a franchise, except by authority of the City Council, upon written request of the Grantee. Section 6414.2. Change of Rates or Charges: Hearing. Prior to authorizing the change of any rates or charges of Grantee to subscribers at any time after the grantingof any franchise, the City Council shall first pass a resolution of intention to do so, describing and stating any rates or charges sought to be changed and the reasons of the City Council therefor, fixing a day, hour, and place certain when and where any persons having any interest therein may appear before the City Council and -5- be heard, and directing the Clerk of the Council to cause said Resolution to be published at least once in a newspaper of general circulation within the City within fifteen (15) days of the passage thereof, and a copy thereof shall be mailed to any Grantee hereunder at least ten (10) days prior to the date specified for hearing thereon. At the time set for such hearing, or at any adjournment thereof, the City Council shall proceed to hear and pass on all presentations made before it, and the decision of the City Council thereon shall be final and conclusive. If the City Council shall find that the changing of any rates or charges of Grantee to subscribers will not be detrimental or injurious to the best interests and welfare of the subscribers and of the City, the City Council may, by resolution, authorize the change of any rates or charges of Grantee to subscribers as shall be deemed reasonable by the City Council; and such resolution shall thereupon become a part of any franchise granted hereunder and affectedthereby. Section 6414.3. Federal or State Jurisdiction. In the event the Federal Communications Commission, the Public Utilities Commission of the State of California, or any other Federal or State body or agency shall now or hereafter exercise any paramount jurisdiction over the subject matter of any franchise hereunder, then, to the extent such jurisdiction shall preempt or preclude the exercise of like jurisdiction by the City, the jurisdiction of the City shall cease and no longer exist; provided, however, that the preemption or preclusion of the exercise by the City of any of its police power shall not diminish, impair, alter, or affect any contractual benefit to the City nor any contractual oblication of the Grantee under any franchise issued hereunder. In this respect, any and all minimum standards governing the operation of Grantee, and any and all maximum rates, ratios, and charges specified herein or in any franchise issued hereunder, existing now and at any time in the future, including such time as any _paramount jurisdiction shall preempt or preclude that of the City, and any and all rights, powers, privileges, and authorities of the City to determine, establish, or fix any of the same, are each and all hereby declared by the City and by any Grantee accepting any franchise hereunder to be contractual in nature and to be for the benefit of the City and all subscribers situated therein, and the agree- ment of Grantee to accept and conform to such standards, rates, ratios, and charges is hereby declared by the City and by any Grantee accepting any franchise hereunder to be of the most material and essential consideration for the granting of such franchise, in the absence of which, in whole or in part, the City would not grant such franchise. Section 6415. Offers and Applications for Franchise. All offers to construct, operate, or maintain any CATV system in this City and all applications for any franchise hereunder shall be filed with the Purchasing and Property Control Officer of the City of Santa Ana on a form approved by the City Manager. Each such offer and application shall set forth, contain, or be accompanied by, but not limited to, information required by the Instructions to Offeror- Applicant, other franchise documents, or by the City Manager. The City Manager, to make his recommenda- tions respecting such offers and applications, shall require the following: (a) Identity of Offeror - Applicant. (b) Organizational structure of Offeror- Applicant. (c) Operational plans of Offeror - Applicant. (d) Any other details, statements, information or references pertinent to the subject matter of such offer and application which shall be required or requested by the City Council or the City Manager or by any provisions of the Charter of the City of Santa Ana or the Santa Ana Municipal Code. (e) An application fee in the sum of One Thousand Dollars ($1,000.), which shall be in the form of cash, certified or cashier's check, or money order, which shall apply toward the costs of studying, investigating, and otherwise processing such offer and application and which shall be in consideration thereof and not returnable or refundable in whole or in part; provided that any Offeror- Applicant who shall deliver to the Purchasing and Property Control Officer a written withdrawal of any offer and a cancella- tion of any application hereunder not later than the seventh (7th) day next following the day such offer and application is received by the Purchasing and Property Control Officer shall be entitled to have returned and refunded the sum of Seven Hundred and Fifty Dollars ($750.00), less any actual costs or expense incurred by the City by reason of such offer and application which shall exceed Two Hundred and Fifty Dollars ($250.00), the said Two Hundred and Fifty Dollars ($250.00) representing administrative expense in processing the application . 6 Section 6418. CATV Franchise Procedure. (a) The City Council may, by advertisement or any other means, solicit and call for offers and applications for CATV franchises; may determine and fix any date upon or after which the same shall be received by the City, or the date before which the same must be received; or the date after which the same shall not be received; and may extend such date or dates and make any other determinations and specify any other times, terms, conditions, or limitations respecting the soliciting, calling for, making, and receiving of such offers and applications; provided, that the City Council shall not be required to solicit or call for such offers or applications and may receive or refuse to receive any of the same, solicited, called for, or otherwise, as the City Council may elect. (b) Offers and applications for franchise shall be prepared and submitted in the manner, time, and form as herein or otherwise provided within the franchise documents. SECTION 2: That this Ordinance shall take effect thirty (30) days from and after the date of its adoption. PASSED AND ADOPTED by the City Council of the City of Santa Ana at its regular meeting held on the 3rd day of September , j 1968. ATTEST: MAYOR CLERK OF THE COUNCIL -7- STATE OF CALIFORNIA) COUNTY OF ORANGE ) SS CITY OF SANTA ANA ) I, DORIS M. BROWN, do hereby certify that I am the Clerk of the Council of the City of Santa Ana, California; that the foregoing Ordinance was introduced to said Council held on the 19th day of -Awust , 1968, and was again considered by said Council at its regular meeting held on the 3rd day of September , 1968, and was at said meeting passed and adopted by the following vote, to wit: AYES, COUNCILMEN: Herrin, Brooks, Carlson, Griset, Thurman, McMichael NOES, COUNCILMEN: None ABSENT, COUNCILMEN: Markel CLERK OF THE COUNCIL PROOF OF PUBLICATION ( 2015.5 C.C.P. ) STATE OF CALIFORNIA, ss. County of Orange, Rose Stanfield I am a citizen of the United States and a resident of the County aforesaid; I am over the age of eighteen years, and not a party to or interested in the above entitled matter. I am the principal clerk of the printer of The Register, a newspaper of general cir- culation, published in the City of Santa Ana, County of Orange, and which newspaper has been adjudged a newspaper of general circulation by the Superior Court of the County of Orange, State of California, under the date of November 29, 1905, Case Num- ber A21046; that the notice of which the annexed is a printed copy, has been published in each reg- ular and entire issue of said newspaper and not in any supplement thereof on the following dates, to- wit: Septerber 14, 1068 I certify (or declare) under penalty of perjury that the foregoing is true and correct. Executed at Santa Ana, California. Date _- _SepteTlber 11�,------ - - - -__ 68 -- 19 -- - - - - -- Sigh9ture ?lose Stanf ie) d 2 - Legals DSP 165 PROOF OF 01 1 i r� This space ,:or the County Clerk's Filing Stamp I~ I L E D '' jj 1 8 1968 CLERK Or 1 ,st= �JUNCIL CITY OF SANTA ANA Proof of Publication of Notice of Ordinance No. NS -934 I a service or commodity a In contemplated. "CATV not include what is co! fbj " er . shall mean the Banta Ana as now or time d♦+lineated I (o) the, Cty XaNnager of th* Santa Ana California. 1(4) "CITY CO'tTRCIL" shat the City Council of the Santa Ana, California. (eD FUN ITIterritory �MA" Grantee shall be author construct, maintain, an< �,te its. system. (f) GRANTED" shall met Person, firm, or co 0 cetvinR the gr�lnt of L ,his. 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Plss Io o RIA uolesl3Q Ad-1 •ox 1.181 a setlgo I'saeua$ IOU ao aaglagA>s do 1s t PI'ss Io 8a8I0A eq1 04 8u111itugns Io i 811aB8as�Q TWOS W44 I0 'oralA solssIXIi ty 7itr ultmAS 8961 aaquialdes ;o .cap g1Lt ac14 teaeq Imq 110110e1e Islaeds s 1ag1 t1NAi't3 NO' 1113-1-3 atp 3t9t w140N I136411 LTION a resident of ge of eighteen d in the above I clerk of the of general cir- Ana, County been adjudged y the Superior of California, 15, Case Num- h the annexed d in each reg- per and not in ,ving dates, to- of perjury that This tegdl "emm S (2) A fixed percentage of the subscribers twith na the eCity; Cc or ra (3) A combination of (1) and (2) or above. Any grantee traversing any por- ini tion of the City, in order to provide ch service outside the City shall pay se to the City such additional sums ne therefor at such tlmes and in such of Imanner as the City Council shall su determine ge Section 6412.2. Franchise Payments of Not in Lieu of Taxes. ex ! Payments to the City by Grantee Cc shall not be in lieu of any occupa- th tion, income, license, or property SE tax or similar levy, assessment, fee, -or charge which would otherwise ,apply to and be payable by Grantee of i to the City, unless otherwise pro- tc Ivided by ordinance. tl Section 6412.3. Corporate Surety C j Bond Re City, In Upon acceptance of such fran- s( ehise, Grantee shall file with the cl Clerk of the Council, and shall tl thereafter during the entire term tl of such franchise maintain in full nl force and effect, a corporate surety p bond or other adequate surety it 'agreement in the principal amount C and upon the conditions described tl in the specifications, for the bene- st fit of the City. le Section 6412.4. Corporate Surety e space iOr }h@ ' Bond Re Subscribers, w Upon acceptance of such Fran- s, chise, Grantee shall file with the s Clerk of the Council, and shall h thereafter during the entire term n :)f such franchise maintain in full it force and effect, a corporate surety s ;bond or other adequate surety n I agreement in the amount and upon s the conditions described in the spa- a cifications, for the benefit of Sub- a scribers. t Section x 412.5. Comprehensive Lia- a billty Insurance. Upon acceptance of such fran- t t� �3 1 Q 1'�hise , Grantee shall file with the g 1 v ' Clerk of the Council, and shall i thereafter during the entire term t of such franchise maintain in full It CLERK OF 1 I"Iforce and effect, a general compre- t I hensive liability policy of insurance t CITY OF SAN; providing coverage as described in i ' the specifications, e !Section 6412.6. Construction, Instal. I lation, and Service Standards. I (a) The City Council may from I time to time establish and notify l Proof of Publication 0 G Grantee of reasonable standards 1 governing t the engineering'. con- maintenance of all CATV systems in t the City, including bonding, t equipment a attachments and instal - Notice of O OrC�IITdon, s subscriber service drops, lightning a arrestors, and other pro- tective devices and facilities there- for. Grantee shall comply forthwith with such standards, upon notifi- cation, (b) The City shall have the right to make additional use, for any public o PasteI any poles, conduits, or other facili- ties eed, controlled. or min- tained r exclsively byor for Gran- tee in any street, provided such SIuse by City does not substantially interfere with the use by Grantee. In ' (c) In the event the use of any part of the system of Grantee (1) is discontinued for any reason for a continuous period of one hundred g� VI and eighty (lku) days without prior the City Manager, or (2) has been p R R installed in any street or other m without complying with the i m L o or shall expire, Grantee, at the pepse of Grantee and at no expense {o the City, upon demand of the ity Manager, shall promptly re- f i ill p A. t property o it4 t Street a such condition as the Director of :' a a .Public Works. , shall approve; pro - s N -tot neglect of Grantee to cause a'work or other act required by la, - or hereunder to be completed prof er e in, over. on. or Wader any strei Lee i' he �wit7lth any time prescribed there Word ' 1fFiy of for, or upon notice given where n tltlutd�torq ;' t - is time is prescribed, the Director i Public Works may cause such wor „d - I- or other act to be completed i m whole or in part, and, upon i d all doing, shall submit to Grantee a an S, itemized statement of the cos y thereof. and Grantee shall, with or thirty (30) days after receipt or such statement. pay to the City tl F h�yple entire amount thereof. dis- (e) Grantee shall be required bri as provide service to any person desi a, e. ng to subscribe to such service or in dorrteliFplat "CX all the City; provided, however, th riot inClU a what !q ly the obligation of Grantee to provi ( service to isolated subscribers shi Of be subject to such terms and cone any tions as the City Council shall a prove in the franchise of Grant( an (f) Unless otherwise provided i0) 09 of any given instance, where any tit is prescribed herein for the dot ILA) y can or causing to be done of any a 00A ty of the City Manager, for good ca.u, in writing, may extend any tit 1aN so prescribed for two (2) additiot lei m tch'1 periods of not to exceed ninety 0 (4lt6tl � to [[ days each. coAltfllot, itFid.° er- Section 6413. Franchise Limitatio ie its ��� In addition to any other franch in #As I.151`iillil'1P. any limitations hereunder or as her, "irwL re- provided, the following limitati( it, n- shall apply to any franchise Bran yz„ in- or rene.�.wed by the City Cour Hegel "CAM Lt the time of the granting of y franchise hereunder, the City until shall approvee and fix all .es and charges allowable to Emtee, including, but not limited all such rares and charges for tallation of equipment; service Lrges for all classifications of •vice, including additional con - 2tions at one location: and any ter rates or charges of Grantee to bscribers. No such rates or char- s shall 'ire changed at any time er the granting of a franchise, cept by authority of the City until, upon written request of e Grantee ction 6414.2. Change of Rates or Charges: Hearing. Prior to authorizing the change any rates or charges of Grantee subscribers at any time after e granting of any franchise, the tv Council shall first pass a reso- tion of intention to do so, de- ribing and stating any rates or .arges sought to be changed a!nt e reasons of the Cite Council erefo *, fixing a day, hour, and ace certain when and where any arsons having any interest there - may appear before the City )uneil and be heard, and directing .e Clerk of the Council to cause .id Resolution to be published at ast once in a newspaper of gen- -al circulation within the City ithin fifteen (15) days of the pas - tge thereof. and a copy thereof tall be mailed to any Grantee >reunder at least, ten Wl i dais •ior to the date specified for hear - ,g thereon. At the time set for tell hearing. or at any adjourn - !ent thereof, the City Council tall proceed to hear and pass on presentations made before it, ad the decision of the City Council iereon shall be final and conclu- .ve. If the City Council shall find that 1e changing of any rates or char - es of Grantee to subscribers will of be detrimental or injurious to 1e best interests and welfare of 1e subscribers and of the City, he City Council may, by resolti- ion, authorize the change of any ates or charges of Grantee to ubscribers as shall be deemed easonable by the City Council; nd such resolution shall thereupon ecome a art of ranted hereunder and franchise affected hereby. iection 6414.3. Federal or State Jurisdiction, In the event the Federal Comnm- dcations Commission, the Publio Jtilities Commission of the State of California, or any other Federal it State body or agency shall now ,r hereafter exercise any para- nount jurisdiction over the subject natter of any franchise hereunder. :hen, to the extent such iarisdic- :ion shall preempt or preclude the axercise of like jurisdiction by the it,, the jurisdiction of the City shall cease and no longer exist; provided, however,. that the pre - amption or prechision of the exer- oise by the City of any of its police power shall not diminish, impair* alter, or affect any contractual ben- efit to the City nor any contractual obligation of the Grantee under any franchise issued hereunder. In this respect, any and all miinimurn ofaGrantee, andnany and all maxi- count rates, ratios, and charges specified herein or in any franchise issued hereunder, existing now and at any time in the future, includin; such time as any paramount juris- diction shall preempt or preclude that of the City, and any and all rights powers, privileges, and au- thorities of the City to determine. establish, or fix any of the sarnies are each and all hereby declare by the City and by any Grantee accepting any franchise hereunder to be contractual in nature and t6 be, for the benefit of the City and all subscribers situated there and the agreement of Grantee accept and conform to such Stan ards, rates, ratios, and charges is here byy declared by the City and by any tGrantee accepting any fran- chise hereunder to be of the most fortthe !granting oft such franchise. In the absence of which, in whole or in part, the City would not grant such franchise. Section 6415. offers and Applica• tions for Franchise. All offers to construct. operate, or maintain any CATV system is this City and all applications for any franchise hereunder shall be filed with the Purchasing and Prop- erty Control Officer of the City of , r Santa Ana on a form approved by a the City Manager, Each such offer and application shall set forth contain, of be accompanied by, bud t not limited to, information requir64 by the Instructions to offeror-AP.- plicant, other franchise documet} S, or by the City Manager. The City f Manager, to make his recommends - n tions respecting such offers fttid o applications, shall require the fol- n lowing: s (a) Identitv of Offeror- Applicsnt. n (b) offeror-Applicant. Organizational structure of if (c) operational plans of offeror. .e Applicant. o (d) Any other details, statement!. information or references per - n tinent to the subject matter Lt of such offer and application le which shall be required or it requested by the City Counan or the City Manager or by i" any provisions of the Charter e. of the City of Santa Ann or e' the Santa Ana Munieipsl In Code. le g (e) An application fee in the )ISM i of One Thousand D09% t' (81,000.), which shall be in e, the form of cash, certified ne or cashier's check, or motley al order, which shall applV to- o) ward the costs of studying. is investigating, and otherwise se processing such offer and ap se placation and which shall D! ns in consideration thereof, 8441 ed not returnable or refundsbIs cal in whole or in part; pro that any Offeror - APPIb lit _.o_ :I, a -7 ;.mr to th. r. Hegel "CAM Lt the time of the granting of y franchise hereunder, the City until shall approvee and fix all .es and charges allowable to Emtee, including, but not limited all such rares and charges for tallation of equipment; service Lrges for all classifications of •vice, including additional con - 2tions at one location: and any ter rates or charges of Grantee to bscribers. No such rates or char- s shall 'ire changed at any time er the granting of a franchise, cept by authority of the City until, upon written request of e Grantee ction 6414.2. Change of Rates or Charges: Hearing. Prior to authorizing the change any rates or charges of Grantee subscribers at any time after e granting of any franchise, the tv Council shall first pass a reso- tion of intention to do so, de- ribing and stating any rates or .arges sought to be changed a!nt e reasons of the Cite Council erefo *, fixing a day, hour, and ace certain when and where any arsons having any interest there - may appear before the City )uneil and be heard, and directing .e Clerk of the Council to cause .id Resolution to be published at ast once in a newspaper of gen- -al circulation within the City ithin fifteen (15) days of the pas - tge thereof. and a copy thereof tall be mailed to any Grantee >reunder at least, ten Wl i dais •ior to the date specified for hear - ,g thereon. At the time set for tell hearing. or at any adjourn - !ent thereof, the City Council tall proceed to hear and pass on presentations made before it, ad the decision of the City Council iereon shall be final and conclu- .ve. If the City Council shall find that 1e changing of any rates or char - es of Grantee to subscribers will of be detrimental or injurious to 1e best interests and welfare of 1e subscribers and of the City, he City Council may, by resolti- ion, authorize the change of any ates or charges of Grantee to ubscribers as shall be deemed easonable by the City Council; nd such resolution shall thereupon ecome a art of ranted hereunder and franchise affected hereby. iection 6414.3. Federal or State Jurisdiction, In the event the Federal Comnm- dcations Commission, the Publio Jtilities Commission of the State of California, or any other Federal it State body or agency shall now ,r hereafter exercise any para- nount jurisdiction over the subject natter of any franchise hereunder. :hen, to the extent such iarisdic- :ion shall preempt or preclude the axercise of like jurisdiction by the it,, the jurisdiction of the City shall cease and no longer exist; provided, however,. that the pre - amption or prechision of the exer- oise by the City of any of its police power shall not diminish, impair* alter, or affect any contractual ben- efit to the City nor any contractual obligation of the Grantee under any franchise issued hereunder. In this respect, any and all miinimurn ofaGrantee, andnany and all maxi- count rates, ratios, and charges specified herein or in any franchise issued hereunder, existing now and at any time in the future, includin; such time as any paramount juris- diction shall preempt or preclude that of the City, and any and all rights powers, privileges, and au- thorities of the City to determine. establish, or fix any of the sarnies are each and all hereby declare by the City and by any Grantee accepting any franchise hereunder to be contractual in nature and t6 be, for the benefit of the City and all subscribers situated there and the agreement of Grantee accept and conform to such Stan ards, rates, ratios, and charges is here byy declared by the City and by any tGrantee accepting any fran- chise hereunder to be of the most fortthe !granting oft such franchise. In the absence of which, in whole or in part, the City would not grant such franchise. Section 6415. offers and Applica• tions for Franchise. All offers to construct. operate, or maintain any CATV system is this City and all applications for any franchise hereunder shall be filed with the Purchasing and Prop- erty Control Officer of the City of , r Santa Ana on a form approved by a the City Manager, Each such offer and application shall set forth contain, of be accompanied by, bud t not limited to, information requir64 by the Instructions to offeror-AP.- plicant, other franchise documet} S, or by the City Manager. The City f Manager, to make his recommends - n tions respecting such offers fttid o applications, shall require the fol- n lowing: s (a) Identitv of Offeror- Applicsnt. n (b) offeror-Applicant. Organizational structure of if (c) operational plans of offeror. .e Applicant. o (d) Any other details, statement!. information or references per - n tinent to the subject matter Lt of such offer and application le which shall be required or it requested by the City Counan or the City Manager or by i" any provisions of the Charter e. of the City of Santa Ann or e' the Santa Ana Munieipsl In Code. le g (e) An application fee in the )ISM i of One Thousand D09% t' (81,000.), which shall be in e, the form of cash, certified ne or cashier's check, or motley al order, which shall applV to- o) ward the costs of studying. is investigating, and otherwise se processing such offer and ap se placation and which shall D! ns in consideration thereof, 8441 ed not returnable or refundsbIs cal in whole or in part; pro that any Offeror - APPIb lit _.o_ :I, a -7 ;.mr to th. r. genera' cir- nfa Ana, Count S been adjudge( by the Superior fe of California, 05, Case Num- ch the annexed d in each reg- per and not in dates, fo- perjury fhaf • i F OF A34 �DD�v c�.ntinnons p�r'nd t' ,,,.,� ;, r an ee a,nd .; v n.rd a.l max: - rt A� °T" 7 a TO 4,RTI ' = r and eighty I1hU �� id''ec atria rates, ratoe• and charges O4- THE. S - `�( ) day's without prior specified herein or in buy franchise F SANTA ANA ML(dI('I.:.u'ritten notice to and a Y Pr'�L CODE TO PROVIDE. rqR the City Manager, or �Ppr °vii b- issued hereunder existing now and THE GRANTING OF FfIgN. installed in any streets oasother such time as as stirs future, including TENNA E8 FOR TELEVISION SYSTEMS area without corn d m Y Paramount juris- I y g with. the 'diction shall preempt or' AND FOR THE TERMS, CONDi requirements hereof, or (3) any that of the City, and any franchise is terminated cancelled, ri rtes Y and all TIONS, AND LIMITATIONS or shall expire, Grantee, at: the thoritiesofethe Cut UNDER WHICH ANY SUCH y Privileges, and au- option of the City at the ex- establish, or fix any of determine. ramie. SYSTEM SHALL O P E R A T I- pease of Grantee and at no expense are each and all hereby declared WITHIN THE CITY OF SANTA, to the City, upon demand of the by the City and b hereby ANA, CALIFORNIA City Manager, shall promptly re- accepting an y y Grantee THE CITP COUNCIL OF Hl move from any street or other area to b cntractualainhna,turer and dto CITY OF SANTA ANA DOE','(-)R-'l all property of Grantee, and Gran- be, for the benefit of the City DA1N AS FOLLO'i -S; t.ee shall promptly restore the all subscribers situated thre d SECTION 1: That in order tt, street and other area from which and the a reentent of Grantee to Provide for the granting of fra.r- such property^ has been removed to accept andgconform to such stand - Telees for Community Antenna `ueh condition as the Director of Ards, rates, ratios, and charges is rlpts�sicondi ns andit limittation� Public Works Manager m., pro - hereby declared by the City and by tided, the rk approve- G 3 under which such s�Stents shall written application g theref ruPby chi e hereunder 6P it ofany most operate within the City' of Santa Grantee, approve the abandonment in and essential consideration Ana, the Santa Ana Municipal Code of any of such property in place by for the granting 1s hereby amended by adding Chap- Grantee and under such terms and in the absence f which, franchise. ter 4 d Article VI thereof to read ; Conditions a the City lganager may or in part, the City would not grant In words and figures as follows: Prescribe; and upon abandonment such franchise. CHAPTER 4 — FRANCHIS "ES I of any such property in place, Section 6415. Offers and Applica• Part 7 — Community Antenna Grantee shall cause to be executed, lions for Franchise. Television Systems a,'kno,Iedged, and delivered to the All offers to construct, operate, ,a Section 6410. Definitions, City such instruments as the City or maintain any For the purpose of this Part, the Attorney shall prescribe and ap- this City and a1lCapplicatinmfor following words, terms, P•ove. transferring and conveying ariv franchise hereunder shall be abbreviatious, derivatives Phrases• "the ownershi of such and the e ea - P property to filed with the Purchasing and Prop - of any thereof shall have the mean- l' the City. ings set forth herein. When not d erty Control Officer of the Ch,, of inconsistent with the context, words g) Upon the failure, refusal, or Santa Ana ml a form approved ne neglect of Grantee to cause an the City such o e abed in any prticala,r terse, hum Wo1'k or other act required by lacy and application shall set hforthr ber, or gender Include d ender. oThc Prl�tilleoverrpn or a completed tree not limited o, accompanied orni required y I)i tense, number, and word "may" is permissive and not ' fo i inn any tune prescribed there by the Instructions to ion Mandatory- the word "shall" is�1tiineoisupon n °lice given where no piicant, other franchise documents, mandatory and not permissive: Prescribed, the Director of or by the City Manager. The City (a) CATV shall mean communi- Public Works may cause such work Manager, to make his recommends- an antenna television system whole or stet to be completed in, and shall include any and all doing, shall submit to tions respecting such offers and systems, part, and, upon so applications, shall require the fol- methods, facilities, itemized statement Of the an lowing: and means wherein or whereby thereof, and Grantee shall, within (b) Organizational structure of coaxial cables, ways the costs (a) Identity of Offeror - Applicant. other devices, equipment., orp such statement. s y techniques are utilized, in whole t entire amount the eof.r receipt of Offeror - Applicant. or in Pay to the city the (e) Operational plans of Offeror. tributi�g Part. for ,signals g o dis- (e) Grantee shall be re Applicant. a service or commodity here� I provide service to any person d sir (d) Information or rlefeentees pie in contemplated. "CATV^ s Ing to subscribe to such service in tinent to the subject matter not rpd t Include what is commnay� i the bligation of Grantee to provide which shall be re provided, however, that of such offer and application referred to as "pay TV.^ (b) CITY" shall mean the City of be subject to such terms and condi- or the Cit service to isolated subscribers shall requested by the City Council Santa Ana to as now or at any tions as the City required or time delineated, y Council shall a an y Manager or by I (c) CITY MANAGER" shall mean 'i pt oce in the franchise of Grantee y pr° - isiona of the Charter the City Manager of the Cit of.an(f) Unless otherwise of the City of Santa Ana or Santa Ana, California. y 3 given instance, where any the Santa Ana Municipal is prescribed herein for the doing (e) Andaoplication fee in the sum (d) "CITE COUNCIL" shall mean ( or causin to be, done of an the City Council of the City of the City Manager, for Santa Ana, California, Y act, of One Thousand Dollars (e) •FRANCHISE, 11e writing, may good cause, (81,000.), which shall be in mean the territorRyl in whial sO prescribed for two nd any time the form of cash, certified Periods of not to exceed d)nanetttional Or cashier's or money Grantee shall be authorized today, each. y (90) the construct, maintain, and oper- Section 6413. Franchise Limitations. studying Y tTvard die its systeut' investigatingstandf other (f) GRANTEE." shall mean any; limritatdionsohereundertorrasaIt se pltcation and which shall be person, firm, or corporation re- I g such offer and an- Person, the grant of any fra -n- shalliapp�lytto aatoll °wing ihnitations in consideration thereof and, chise hereunder and Shall in- or renewed bYytfranchise granted in whole or in olude any lawful successor to 1. under this Part. not returnable or refundable the interest of such y Council part; provided firm, or corporation, person, e Section 6413.1. Nature of Franchise, that any Offeror - Applicant Neither the granting of said fran- who Shall IPror to e Pur- (t) face of a d theaspaceaabove and conta }n d herein ny of tin such fran- Office'- offer and a caneella- below any public water, rho- ;� chise shall limit, abridge, provisions Officer a written withdrawal roughfare, s t r e e t, highway, alter, or affect the ri ht, of an WILY, hereditament, or h diminish, tion of any application here - auch,interest. or place in other Power, and the City Council here- under not later than the sen- or authority of the City the (7th) day next following there is public control or direc- by reserves and the day such offer and appli- t e as to the use or occupancy after the first two oZ es the right thereof, which now or hereafter to cation is received by the Pur- grant any () full years Officer and property Control shall exist within the City.•! or different francdhiste to env per sronr Officer shall be entitled to (h) SUBSCRIBER" shall are a ri firm, have returned and refunded ILIFy person or other entity Witt_ Grantee either within or er than and e 811111 Fiftyo Seven Hundred In the City receiving for any without purpose busy CATV Service of the franchise area of an less F ($750.00), any grants, provided that the City Grantee; y actual costs or ex- S•etibti 6411. Autharlt Grant�a shall not Council pease incurred by the City by lrra hiss. y 13 uder contai ingiA113, termssor con - Plicationf whi Itoshallaexceed (a? Y franchise granted purstt` ditions which shall be less favor - ahle to Tao Hundred and Fifty Dol- "the provisions of this Bart; :to .any Grantee, or more favorable lars ($250,00), the said Two tee to do the following: the condttmn Wa the terms or Hundred and Fifty Dollars (1) Erect, install, consttuct, hereunder, any 0 ber franchise 060.00) representing admin- Dair, replace, reconstr chise 6413.2, is rative expense in process - 0- intain Transfer of Fra in th and retain in •d Pro franchise Dyer, under, across, andpaltl�g shall be old granted hereun street suc I c wire' cable, conductors d et as aned, or oth ©nviserdisposeds conduit, vaults, not o4n whole or in part, voluntarily amplifiers, applianees,athol!fs� .invohmtarily, without the ments, and other aC3i� °consent of the property a,slthen only City Council, Pa tenantetoethe CATV and conditions 11PO11 such terms a and so to use, operate, as the City Council m Prescribe No purchaser, less 'properties similar facilities sale, transfer, lease, or assignme Provide .- recipient of any su D opertte rented or leased without such prior written e { from other persons• firms, or seat 1 corporations, including, but of the City Council, will a not Nmited to, an quire any of the rights of t utility- or other grantee o uanv R sectiolts64holder, erm franchise of this City; of Franchis (2) Maintain and operate facili- No franchise granted or renews ties and properties for the cha,lhehe t {or t1Oil under this Pat ducts tin, transmission, con_ five (5) years, miler shorter tha dgot�On, amplifications, con - I prior to its e. terminate atere.on, and distribution of i provided; nor s1 aillaann as here! programs by use of eleotri chise Y such fran city, micro -wave, or other i a grant ad or renewed be for a energy source. :Sgregate term in excess (b) A franchise granted to I tP-fiv e (26) years. of twen vide service within the City Pro Section 6413.4. No Recourse authorize and hermit the Gra tee City. Against to solicit, sell, distribute, and make ` remrer {l�tea shall have no recourse or ,a charge to subscribers within the City for anv lose City for connection to the C. whatsoPCer against the ATV damayP arising out for expense, �re� !system of Grantee, and shall auth- jorize and permit the Grantee to sper_t to any franchise hereunder, pass over, across, or through an this !'art, or the enforcement !portion of the City in order y thereof. bide Service, outside the City. pro- Section 6413.5, City AJOCtlOn 6412• Franchise Re airs• Regulations, y Rules and meats. q Grantee shall be sub ,iect to a}} In addition to any other franchise ordinances, rules, regulations, and reguirements hereunder, or made or `Pecifications of the City hereto - �doptgd' 48 herein prov•d fore or hereaft n• a application, Section 6415. CATV Franchlse Pre. der cedure, ed (a) The Citv Council rnSLY by-, °f' solicit tiand call for offers and a p O7 cations for CATV for determine and fix fang dials u)>nn nd ay recet�ed which the same shall be ay v the City, or the date ch before received; which datenaftmust r which eh the same shall not be received; nt, and May Y extend such date !n dates c_ and make busy other determinations It and Specify anv other times, terms, conditions, or limitations respecting e the soliciting, calling for, niaking, d and receiving oP such offers and. .t Council sh ;provided, that the City It Council shall nit be required to d solicit or call for such offers or n applications and may receive or refuse to receive any of the same, n solicited, called for or other e, _ as the City Council , mav .-ect. (n) Offers and applications for submitted franchise shall be prepare„ and submitted In the manner, time, and farm as herein or otherwise pro- vided within the franchise docu- ments. SECTION 2: That this Ordinance shall take effect thirty (30) da,•s from and -after the date of its adoption. PASSED AND ADOPTED 1), the Ana toitsyreg larhmeettin h Santa the 3rd day of September, 1968. ATTEST: 10110 red, the cludng but not rlintitaghshed. in- /s/ TOM bICMICHAEI, to an g requirements shall apply Ma Y franchise granted or re- pertaining to works and to /s/ DORIS M. BROWN newel by the City Council under gin. on' over, under, Clerk of the Council rte Part. streets. and about STATE OF Ion 8412.1. Franchise Payments; Section 6413.6. Prohibited Activities CALIFORNIA ) Ono Grans Within City, of Grantee, COUNTY OF ORANGE ) as T e Grantee of anv franchise to Subscribe G�t relay not broadcast to CITY OF SANTA ANA ) Provide Certify thatlIBam` the Clerkebf p Service within the City for which broadcaram or event shall pay to' the City, upon stye the Council of the Oily of Santa VC. 9e Of S11Ch franchise, a fee cer- a separate P charge is made. whether by Grantee Ana, California; that the foregoing tan in such amount as shall be or any other person, firm, or tor- Ordinance was ntroduced to said 1addiowed by the City Council. In pea {ation. tohe, Purpose of this pt•o_ by the for each Council held on the 19th day of by the City CoUuOil sod approved engaging rn thatlbasinessncommop sidered by saidaCouncil atglta regu- il, and at --'tell ly referred to as 'pap TV". trt16S and in sur•h manner as the lar meeting held on the 3rd day of C11Y Council shall agree upon, the Section . Ad, ption of Rules and l-(iltitritee shall September. 1968, a -nd was at said pay to the C }t�. Regulations. meeting passed and adopted by the duruPg the entire term of At all times during the term of following vote, to wit. franchise, one of the term such any franchise AYES, COUNCILMEN: Herrin, submitted in the g sums the C}tc. Councgil granted hereunder ;Ap lication for Offer and power to, and shall adopt and ene Brooks. Carlson, Griset, Thur- pp CATV Franchise force, and Grantee shall conform man. A1cMlchael. arFd ILe ratifi�id in the ordinance to, rules and regulations NOES. COUNCILMEN: granting CATV franchise and fran- ABSENT, COUNCILMEN one cruise certificate, whichever is and establishing reasonable kel. Mar - 'rg�test: the beds of performance pertaining to /S/ DORIS M, BROWN (�7 A fix4ld Sum certain; •r the system of Grantee. Clerk of the Sect}otn 6414.1. Rates and Charges. Pub: The )3e ister — Council g Sept. 14, 196x, 1 CALIF RNIA September 14, 1967 Please address replies to: MEMO TO: City Council FROM: City Manager - ,- SUBJECT: COMMUNITY ANTENNA TELEVI ION _ CLERK nr TK r "000_ At your last meeting I furnished a copy of a report prepared inMmy ~�_..__r office concerning some facts about the advantages and disadvantages of a Community Antenna Television system. As you know, we have already received contacts from two parties interested in obtaining a franchise to operate in this City. If the Council wishes to proceed with this matter, it is our recommendation to you that you authorize us to do the following: 1. The preparation of bidding specifications and franchise documents to include notice inviting offers and applications, instructions to applicants, form of offer, form of corporate surety bond to the City, form of corporate surety bond to subscribers, and form of acceptance of CATV franchise. It is our intention to award a franchise contract to the successful bidder based on the following factors: the amount of franchise fee offered to the City, installation rates, rental rates, quality of service, financial responsibility of applicant, and experience of applicant. 2. The City Attorney should be directed to draft a specific ordinance to enable the City to grant and control a franchise for the con- struction of CATV facilities. 3. It will require approximately two months to complete the bidding documents and the notice of advertising should also include a notice sent to the California Community Television Association to increase the possibility of obtaining a maximum number of applications for this franchise. 4. It is our intention that the franchise should be made exclusive for the first three years of operation to protect the large capital investment required, and that the franchise then would be non - exclusive for an additional period of seventeen years. Since this type of facility probably will make use of existing lines used by the phone company and electric utilities, it is our intention to consult with these private utilities for their advise and guidance in the prepa- ration of our bidding specifications. Carl Thornton City Manager C September 12, 1967 Mr. John B. Pirie Data Video Systems P.O. Box 2347 San Francisco 26, California Dear Mr. Pirie: Please address replies to: i 217 No. Main Street Santa Ana, Calif. 92701 On September 5th the City Council received my report in regard to Community Antenna Television and deferred discussion until their next meeting which is 2 P.M., September 18, 1967. You, or a member of your office, are welcome to attend this meeting which will be held in the Council Chamber, third floor of City Hall. It. is my opinion that the City Council will direct the staff to pursue the feasibility of Community Antenna Television within the City of Santa Ana. If this is the Council's determination, then it will be necessary to prepare an ordinance of the City of Santa Ana, Calif- ornia, which regulates Community Antenna Television systems and other numerous franchise documents. It should take approximately two months to develop specifications and to prepare the franchise ordinances. Sincerely, G. David Tayco, Assistant to the City Manager 0 t Pleasa address rarlies to: l 217 No. Main Street Santa Ana, Calif. 92701 September 12, 1967 Mr. Philip C. Davis Senior Vice - President Davis Broadcasting Company KWIZ Radio 3101 West Fifth Street Santa Ana, California 92703 Dear Mr. Davis: On September 5th the City Council received my report in regard to Community Antenna Television and deferred discussion until their next meeting which is 2 P.M., September 18, 1967. You, or a member of your office, are welcome to attend this itieeting which will be held in the Council Chamber, third floor of City Hall. It is my opinion that the City Council will direct the staff to pursue the feasibility of Community Antenna Television within the City of Santa Ana. If this is the Council's determination, then it will be necessary to prepare an ordinance of the City of Santa Ana, Calif- ornia, which regulates Community Antenna Television systems and other numerous franchise documents. It should take approximately two months to develop specifications and to prepare the franchise ordinances. Sincerely, 'R ko_�* rl&ky� G. David Tayco, Assistant to the City Manager TE CITY OF SUH M CALIFORNIA August 23, 1967 MEI 0 TO: Assistant City Manager FROM: Assistant to the City bSanager SUBJECT: Community Antenna Television Please addrass replies to: A CATV is a master antenna service that is designed to provide better tele- vision reception than the citizens of a community would otherwise receive with a multitude of individual antennas or other reception devices placed on top of their homes. It is also a way of providing a :rider variety of TV channels than typically is received by the local viewing public. Three years ago the State of California had eighty- eight communities with CATV with an installation fee ranging from 0 to $150; also, the monthly service charge was from a minimum of $2.50 to a maximum of $7.50. It has been -,,.7011 over a decade since community television antennas have been in operation. CATV vas developed to overcome topographical, technical and geographic conditions which limited television reception. In addition, CATV provided a %,,i.der variety of programs than was ever_ before available. Nature o_f_CATV. A CATV system is dependent on a set of antennas built on top of a tall tower. Residents can have their home television receivers connected by cable to the tower's antennas. This brings to the public the increased quality and broader range of television signals etisting on top of the to%�.er. If the desired television stations are located malty miles a�7ay, the television signals can be received and brought back to the CATV system master antenna to %.,er through the facilities of micro-y,ave. At the master antenna to-�,.er, these television signals are then converted to the desired TV channels to be used on the cable within the commu?-lits7. At the base of the master antenna tower, a technical facility is constructed to serve as a control center. Here, electronic eauipment is housed that accepts the re- ceived signals, amplifies them, converts them to desired charnels, and places them on the cable connected :viith the subscribers TV sets. Pa - ;r vs. Free 'I'V. Some governmental jurisdictions feel that CATV may be the sage thing as Pay TV. Ho%.,ever, a CTa.TV s_Vster. is nothing more than a master antenna service. While a nominal fee is paid for this service, the sub- scriber is not paying for specific programs as he would under a Pay TV basis. In fact, the former Chairman of the Federal Conu.i!unications Commission, Frederick 4.7. Ford, stated: "I think there is a distinction betwecn the ACTION OF COUNCIL 2, � L E4 , 1 i t ��f L CLERK OF THE160UkU,L J CATV Page 2 community antenna operations and paid television, using the tv o words in their classic sense. Pay television has generally been described as a system whereby the signal is transmitted in a scrambled form and through some device at the receiver is unscrambled to make the signal clear, whereas CATV does not use the broadcast spectrum primarily, but used cable for the purpose of distributing the signal to the receivers. Pay TV has separate programs for which they charge. CATV picks up free programs and redistributes those." Arguments Against CATV. Those who argue against CATV systems summarize their objections as follows: 1. A CATV system is the first step to-vard full- fledged Pay TV. 2. Outside TV stations are able to compete with stations in the community. 3. The master antenna system acts in competition with local radio and TV dealers who sell and service individual antenna. 4. CATV cable networks add to the unsightly and anti- aesthetic aspect of utility poles. 5. CATV con)panies do not help the local employment situation since they bring construction people in from the outside and use equip-ment and materials manufactured elsewhere. The major sources of opposition are from three sources. First, the Tele- vision Acce_sory Manufacturers Institute which is responsible for the pro- duction of individual antenna units. The next source is the television broadcasters and local television stations which allege that CE.TV syste.ns bring outside channels and networks into the local area and thus compete with their operations. And finally, the local radio and television dealers themselves base their opposition on the fear that such a system would hinder their operations. Arguments for CATV. 1. It should be clarified that CATV equipment does not have the present capacity to meter out TV reception as a true Pay TV system must do. Pay TV does not depend on a CATV system for transmission of television signals to the viewing public. Almost all telephone company pole contracts, which are essential to CA�i -V, exclude the use of poles for Pay TV purposes. CATV Page 3 2. A CATV syster,i relies heavily on the local advertising media; a large amount of newspapers, print and radio advertising is placed on CAT"J. It must be pointed out that there have been no known TV stations that have ever gone out of business as a result of a CATV operation coIing into the comi-ilunity. Many have even profited because of it. 3. CATV systems do not sell, service or repair any television or radio sets. In fact CATV seeks the help of the servicemen and dealers in a cooperative program of adding subscribers to the cable. As a result, dealers sell more TV sets, especially more color sets. Local dealers and servicemen usually find that their business increases significantly once a CATV system is in operation. 4. The unsightly array of individual antennas lining the tops of most private residences can be eliminated. More and more conu;ranities are turning to underground wiring as utility poles are eliminated and telephone and electrical ,tiring is placed underground. 5. A larger CATV corporation normally needs experienced treks to install a CATV syste-m and must call upon outside experts trained in engineer- ing and other fields to get the operation started. However, local people are almost always hired and trained to fill the technician posts necessary for the construction, operation and maintenance of the syste_-n. A local employment situati.on is thus enhanced. Besides these arguments, the follo`,:ing additions are offered in support of CATV systems: 1. Individual television sets do not need a UHF converter. 2. Through a special attachment, FM radio stations can be piped on vacant TV channels or to Fm tuners over the cable. 3. Many CATV companies provide 24-hour weather channels, cabling curres,t weather forecasts over the system. 4. The primary objective of providing better local TV programming for the local public is achieved by bringing distant television stations to the com�iiunity by CATV. This often stimulates the economic growth of a community. Federal Regulations. In no state has CATV been considered a public utility— By and large, the Public Utility Coitimissions do not have jurisdiction CATV Page 4 because CATV systems provide a form of entertainment, and entertainment i not regarded in lav, as a public necessity. Only to the extent a CATs7 operation uses micro-v:ave, does the Federal Cor,-miunications Connnission have some control over the system. Only in a minority of cases, does a CATV system need to relay television signals over such a distance that it needs to supplement its cable operation with a micro-,cave relay. Furthermore, the F.C.C. has reported that it does not consider CATV systems as "common carriers" under the provisions of the Communications Act. In essence, the Commission desires authority to: 1. Require that a CATV system carry the signals of a local station if the latter desires thus. 2. Require that if a local signal is carried, it is carried on the cable syste ci without any degradation of quality. 3. Be able to afford some protection of local stations against duplication of other channels on the cable syste_a of programs being carried sinLul- taneously by the local stations. Therefore, the F.C.C. is largely concerned with the economic impact on local stations by CATV systems. Municipal Regulation. A large majority of cities pass an ordinance establisl- ing an exclusive or non- exclusive franchise to be in effect for a fixed peric>c of time. 141ost CATV companies apparently prefer a franchise. This provides both the municipality and CATV company a wide area of control over the operation, while at the same time creating a stable system which each can feel confident of operating for a fixed period of time. The validity of these, franchise ordinances are usually not open to question. A CATV franchise co:�?r'Lonly provides for regulation of the installations, rates, and services of the grantee; prescribes the duties which the grantee and the municipality ov.e to each other; and requires as a condition to its effectiveness written acceptance by the grantee of all its terms. ?Matters which are often or usually provided for in such franchises are the following: Duration of franchise; whether franchise is exclusive; whether franchise is transferable; obligation of the grantee to save the municipality harmless in the event it incurs liability or loss as a result of company operations, and types and amounts of bonds or liability insurance required for this purpose; amount of franchise fee; installation fee and monthly rates; specifications as to quality of signals to be maintained; provisions relating to carriage and duplication of local stations (this is not regulated by the F.C.C.); require- ments for extension of service; required channel capacity; and provisions concerning Pay TV or program origination. CATV Page 5 A municipalities poker to rewire franchises of CATV companies should not be affected by the fact that such companies may be engaged in interstate commerce, especially in view of statements of the Federal Coi:L1uni.cations Commission that it intends no Federal pre - emption in the CATV field apart from the areas in which it has specifically indicated concern or proposed regulatory measures. The fee charged by the municipality, usually called a license tax, whether measured by gross receipts or b_y each telephone pole or foot of wire, must be "reasonable" in the sense that it is levied only to compensate the city, for the use of its streets, or for the cost of supervision. Charges for a special use of a municipality's streets are in the nature of rent and have been routinely upheld by the courts. There appear to be no decisions on the liability of a municipality for the copyright infringement of its franchise holder, but the differences between such a situation and the facts are at once apparent: The CATV operator does not stand in the relationship of agent, employee, or contractor of the municipality; issuance of a franchise is a legisla-ive and governmental act; and there is no certainty that the CATV system's business is or will. be illegal. California State Regulations. Government Code Section 53066 entitled community antenna television system states that: "tiny city or county or city and county in the State of California may, pursuant to such pro- visions as may be prescribed by its governing body, authorize by franchise or license the construction of a community antenna television system. In connection therewith, the governing body may prescribe such rules and regulations as it deems advisable to protect the individual subscribers to the services of such community antenna television system. The award of the franchise or license may be made on the basis of quality of service, rates to the subscriber, income to the city, county or city and county, experience and financial responsibility of the applicant plus any other consideration that will safeguard the local public interest, rather than a cash auction bid. Any cable television franchise or license awarded by a city or county or city and county pursuant to this section may authorize the grantee thereof to place wires, conduits and appurtenances for the community antenna television system along or across such public streets high-ways, alleys, public properties, or public easements of said city or county or city and county. Public easements, as used in this section,shall include but shall not be limited to any 0 0 CA TV Page 6 easement created by dedication to the city or county or city and county for public utility purposes or any other purpose whatsoever." (Added by Stats 1963 ch 2087 paragraph 1.) There are no other California state statutes which regulate coaununity antenna television. City of Santa Ana Regulations. The Charter of the City of Santa Ana Article XIIi, Sections 1300. through and including Section 1307. describes the terms and conditions of any franchise issued by the City Council. ARTICLE XIII FRANCHISES Section 1300. Franchises: In General. "The ter-,-,,, "the streets of the City" as used in this Article shall include streets, ways, alleys, avenues, highways, boulevards, con- courses, driveways, bridges, parks, parkways, and public grounds or waters within or belonging to the City. Subject to the provisions of this Charter, the City Council shall have the power in behalf of the City to grant franchises or rights or make contracts providing for the furnishing of the City and its inhab_... itants with transportation, cammuni.cati on, terminal facilities, water, light, heat, power., refrigeration and storage, or any other public utility or service, or using the streets of the City for the operation of plants, works, or equipment for the furnishing thereof, or travers- ing any portion of the streets of the City for the transmit-k-ing or conveying of any such service elsewhere. The City Council may grant a franchise to any person, fi.rr, or corporation, whether operating under an existing franchise or not, and may prescribe the terms and conditions of any such grant. The City Council may also provide, by procedural ordinance, the method of procedure and additional terms and conditions for making such grants, subject to the provisions of this Charter. No grant of any franchise may be transferred or assigned by the grantee except by consent in writing of the City Council and unless the transferee or assignee thereof shall covenant and agree to perform and be bound by each and all of the terms and conditions imposed in the grant or by procedural ordinance and by this Charter. I CATV Page 7 The City may issue permits for the construction of spur or side tracks in and over'the- streets of the City and the running of cars thereon for the purpose of connectinc warehouses, factories, or other business industries and enterprises with any line of railroad within the City, upon such ter,--is and subject to such regulations and con- ditions as shall be prescribed frar, t.ir-�.e to time by ordinance. Such tracks shall be used for the transportation of freight only and shall not be used as a main line or part thereof. Such tracks must be laid and operated in such manner and under such restrictions as not to interfere with the use of the streets of the City by the public. All such pen-?its shall be revocable at the pleasure of the City Council_. Section 1301. Franchises: Terms of Franchises. Every franchise shall state the ter:? for which it is granted, which, unless it be indeterminate as provided for herein, shall not exceed twenty -five years. A franchise grant may be indete.nhi_r_ate, that is to say, it may provide that it shall endure in full force and effect until the same, with the consent of the Public Utilities Co,rlission or its succes- sors of th.e State of California, or the Inter -State Canmerce Com- mission as the case may be, shall be voluntarily surrendered or abandoned by its possessors, or until the State of California, or some municipal or public corporation, thereunto duly authorised by law, shall purchase by voluntary agreement or shall Condemn and take, under the power of eminent domain, all property actually used and useful in the exercise of such franchise and situate within the territorial limits of the State, municipal, or public corporation pur- chasing or condemning such property, or until the franchise s?-hall. be forfeited for noncompliance with its terms by the possessor thereof. Section 13002. Franchises: Grants to be in Lieu of all Other. Franchises. Any franchise granted by the City with respect to any given utility service shall be in lieu of all other franchises, rights, or privileges o-;rned by the grantee, or by any successor of the grantee to any right under such franchise, for the rendering of such utility service within the limits of the City as they may now or hereafter exist, except any franchises derived under Section 19 of Article XI of the Constitution of the State of California as said section existed prior to amendment thereof adopted October 10, 1911. The acceptance of any franchise hereunder, shall operate as an abandon-lent- of all such franchise, rights, and privileges within the limits of the City as such limits shall at any time exist, in lieu of which such franchise shall be granted. CAM7 Page S Any franchise granted hereunder shall not become effective until written acceptance thereof shall have been filed by the grantee thereof with the Clerk of the Council.. Such acceptance shall be filed within thirty days after the adoption of the ordinance granting the franchise, or any extension thereof granted by the City Council, and when so filed, such acceptance shall constitute a continuing agreement of such grantee that if and when the City shall thereafter annex, or consolidate with, additional territory, any and all franchises, rights, and privileges owned by the grantee therein, except a franchise derived under said constitutional provision, shall likewise be deemed to be abandoned within the limits of such territory. Section 1303. Franchises: Resolution of Intention, Notice,and Public Hearing. Before granting any franchise, the City Council shall pass a resolution declaring its intention to grant the same, stating the name of the proposed grantee, the character of the franchise, and the terms and conditions upon which it is proposed to be granted. Such resolution shall fix and set forth the day, hour, and place when and where any persons having any interest therein, or any objection to the granting thereof, may appear before the City Council and be heard thereon. The City Council shall direct the Clerk of the Council to publish said resolution at least once within fifteen days of the passage thereof, in the official newspaper. The time fixed for such hearing shall not be less than twenty nor more than sixty days after the passage of said resolution. At the time set for the hearing, the City Council shall proceed to hear and pass upon all protests and its decision thereon shall be final and conclusive. Thereafter, it may grant, or deny, the franchise, subject to the right of referendum of the people. Section 1304. Franchises: Duties of Grantees. By its acceptance of any franchise hereunder, the grantee shall covenant and agree to perform and be bound by each and all of the terms and conditions imposed in the grant, or by procedural ordin- ance, and shall further agree to: (a) Comply with all lawful ordinances, rules, and regulations theretofore or thereafter adopted by the City Council in the exercise of its police power governing the construction, maintenance, and operation of the grantee's plants, works, or equipment; CA TV Page 9 (b) Pay to the City on demand the cost of all repairs to the public property made necessary by any of the operations of the grantee under such franchise; (c) Indemnify and hold harmless the City and its officers from any and all liability for damages proximately resulting from any operations under such franchise; (d) Rei:,ove and relocate v.ithout expense to the City any facil- ities installed, used, and maintained under the franchise if and when made necessary by any lawful change of grade, aligr_ment, or width of any public street, %,,ay, alley, or place that is not a free�,ray to which all rights of access have been acquired by the State of Calif- ornia, including the construction of anv sub�,a_y or viaduct, or if the public health, comfort, welfare, convenience, or safety so demands; (e) Pay to the City during the life of the franchise a percentage, to be specified in the grant, of the gross annual receipts of the grantee �,ithin the limits of the City, or such other compensation as the City Council may prescribe in the grant. Section 1305. Exercise of Privilege j-ithout Franchise. The exercise by any person, fire, or corporation of any privilege for which a franchise is required, without possessing a valid and existing franchise therefor, shall be a misdeleanor and shall. be punishable in the same manner as violations of this Charter are punishable and each day that such condition continues to exist shall constitute a separate violation. Section 1306. Eminent Domain. No franchise grant shall in any way, or to any extent, impair or affect the right of the City to acquire the property of the grantee thereof either by purchase or through the exercise of the right of eminent domain and nothing herein contained shall be construed to contract away or to modify or to abridge, either for a term or in perpetuity, the City's right or eminent domain with respect to any public utility. Section 1307. City- O:�ned Utilities. In the event that any public utility shall be taken over by the City, by purchase or through the exercise of the right of eminent domain, the franchise shall have no value. 0 CATV Page 10 • No public utility o, -,ned by the City shall be sold, leased, or otherwise transferred unless authorized by the affirmative votes of Ewo- thirds of the electors voting on such proposition at a general or special election at which such proposition is submitted." CATV Survey. The ordinances of seventeen California cities have been obtained and summarized as shown on the attachment. The majority of the franchises required that the grantee carry liability insurance to protect itself or the city or both from death, personal injury, and property damage claims growing out of the installation, maintenance, or operation of the CATV system. No coverage to $1,000,000 coverage was required for injury to one person, with $300,000 being the more common figure. No coverage to $1,000,000 coverage was required for injury to more than one person or more than one accident, with $500,000 being the more common figure. No coverage to $100,000 coverage was required for property damage, with $50,000 being the more common figure. All of the cities required faithful performance bonds running to the City. The amount ranged from a low of $1,000 to a high of $500,000 with $50,000 being the more common figure. The franchise fee ranged from a low of 1/ total gross receipts to a high of 5.5 The City of Delano, California has issued a franchise based by scale of payments %•;hick escalates on added increments of gross annual revenue in excess of $75,000 per year. The scale is as follows: Gross Annual Receipts Percentage Payment to City $75,000 5/ Next $25,000 10/ Next $25,000 15/ Next $25 000 20/ Over $150,000 25% Palm Springs is the only city in the survey which issued an exclusive franchise. 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