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ORDINANCE NO. MC-667
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ORDINANCE AMENDING MUNICIPAL CODE SECTION 14.08.110 TO
INCREASE FRANCHISE FEE TO FIVE PERCENT AND TO PROVIDE FOR THE
VERIFICATION OF FRANCHISE FEES BY THE GRANTOR, THE CITY'S
AUTHORITY TO AUDIT, INTEREST ON DELINQUENT PAYMENTS, PASS THROUGH
OF FRANCHISE FEES TO SUBSCRIBERS, AND MEANS TO CHANGE FRANCHISE
FEES.
THE MAYOR AND THE COMMON COUNCIL OF THE CITY OF SAN
BERNARDINO DO ORDAIN AS FOLLOWS:
SECTION 1. Municipal Code Section 14.08.110, is hereby
amended to read as follows:
"14.08.110 Franchise Payments
A.
In consideration of the granting and exercise of a
franchise to use the streets, as defined in subsection I of
Section 14.08.010, for the construction and operation of a cable
television system, any grantee shall pay to the City during the
life of the franchise, an annual franchise fee equivalent to
five percent (5%) of the grantee's gross revenues from
operations wi thin the City for the period, inc].uding, but not
limited to, basic service revenues, non-basic service revenues,
advertising revenues, telemarketing revenues, lease revenues, and
all other one-way and interactive service revenues generated in
any manner by the grantee.
B. The percentage payments shall be made in the manner,
and
at times directed in the franchise or by resolution of the
Council.
C.
Not less than annually, the grantee shall provide the
City with an unqualified certification of an independent
certified public accountant certifying the accuracy of the
franchise fee paid within the preceding twelve (12) months.
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June 28, 1989
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2 Said certification shall be prepared in accordance with
3 generally accepted accounting standards.
4 D. Not more than once each year during the term of the
5 franchise, the City or its representative shall have the
6 right to conduct an independent audit of grantee's records to
7 determine if proper payments have been made to the City, and if
8 such audit indicates a franchise fee underpayment of two percent
(2%) or more, the grantee shall bear all reasonable costs of such
audit.
Each grantee shall make available for inspection by
authorized representative of the City, its books, accounts, and
all other financial records at reasonable times and upon
reasonable advance notice for the purpose of permitting exercise
of the authorities conferred by this Section.
E. No acceptance of any payment shall be construed as a
release or as an accord and satisfaction of any claim the City
17 may have for further or additional sums payable under this
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chapter or for the performance of any other obligation under
this Chapter.
F. In the event that any franchise payment or recomputed
amount is not made on or before the dates specified in the
franchise agreements,
grantee shall pay as additional
compensation an interest charge, computed from such due date, at
the annual rate equal to the commercial prime interest rate in
effect upon the due date.
G.
Any grantee "pass through" or itemization of franchise
fee costs on subscribers' bills shall be in accordance with
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June 28, 1989
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federal law.
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Any grantee shall pass through to subscribers the
amount of any decrease in a franchise fee.
H. The City reserves the right to change its fees if after
a public hearing it determines good cause exists and such action
does not conflict with federal laws, FCC rules and regulations or
the laws of the state of California."
I HEREBY CERTIFY that the foregoing ordinance was duly
adopted by the Mayor and Common Council of the City of San
Bernardino at a __I~g~~~~_____ meeting thereof, held on the
17th day of
July
Council Members Estrada, Reilly, Flores, Maudsley,
AYES:
, 1989, by the following vote, to wit:
Minor, Pope-Ludlam, Miller
NAYS: None
ABSENT: None
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of II/I
, 1989.
Approved as form
and legal content:
JAMES F. PENMAN
City Attorney
By: ~~~~
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DCR:mg
June 28, 1989
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