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HomeMy WebLinkAbout1989-04-18 Support Documentation Town Council Work SessionCc VAIL TOWN COUNCIL WORK SESSION TUESDAY, APRIL 18, 1989 2:00 p.m. AGENDA 1. Presentation of Landscape Improvement Plan - Final Draft 2. Discussion of Heritage Cablevision Proposed Franchise Agreement and Proposed Ordinance 3. Information Update 4. Other VAIL TOWN COUNCIL WORK SESSION TUESDAY, APRIL 18, 1989 2:00 p.m. EXPANDED AGENDA 2:00 1. Presentation of Landscape Improvement Plan - Final Draft Rick Pylman Action Requested of Council: Review and comment on final draft of the plan. Background Rationale: The Town staff and EDAW, Inc. have been preparing a plan that will serve as a guide and framework for future Town of Vail landscape improvements. This plan will allow us to make annual capital improvement budgeting decisions while implementing desired improvements. 2:20 2. Discussion of Heritage Cablevision Proposed Franchise Larry Eskwith Agreement and Proposed Ordinance Background Rationale: John McCabe, a cable franchise specialist with the law firm of Davis, Graham, & Stubbs, will be here to discuss the cable franchise ordinance and agreement with the Town Council and answer any questions you might have. 4:00 3. Information Update Ron Phillips 4:10 4. Other HERITAGE CABLEVISION and TOWN OF VAIL FRANCHISE AGREEMENT This agreement is made and entered into on 1989 by and between the TOWN. OF VAIL, Colorado, a Colorado municipal corporation ("the Town") and CABLEVISION VI, INC. D/B/A HERITAGE CABLEVISION ("Heritage"). WHEREAS, the Town is authorized to grant one or more non-exclusive, revocable franchises to construct, reconstruct, operate and maintain a cable television system within the Town; and WHEREAS, the Town has received a request for renewal of the existing franchise from Heritage; end WHEREAS, the Town, after public hearings and due evaluation, has determined that it is in the best interest of the Town and its residents to renew the franchise of Heritage for a fifteen (15) year term. NOW, THEREFORE, in consideration of the mutual promises and covenants contained herein the parties do mutually agree as follows: 1. GRANT OF FRANCHISE A. Heritage is hereby granted for itself and its successors and assigns, subject to the terms and conditions of this franchise agreement, and the franchise ordinance, the right, privilege and authority to construct, operate, maintain and reconstruct a cable television system within the streets, alleys, easements or such easements are broad enough to allow the installation of cable television facilities, and public ways of the Town. Heritage shall provide a modern and uniform Town-wide cable communications system to the residents and institutions of the Town in accordance with this franchise agreement. B. This franchise is subject to Chapter of the Town of Vail Municipal Code and other ordinance provisions now in effect or hereinafter made effective. Nothing in this agreement shall be deemed to waive the requirements of the various codes and ordinances of the Town regarding permits, fees to be paid, or manner of construction. C. For the purpose of operating and maintaining a cable television system in the Town, Heritage may erect, install, construct, repair, replace, reconstruct, and retain in, on, over, under, or upon, across and along the public streets, available easements, alleys and ways within the Town, such wires, cables, conductors, ducts, conduits, vaults, manholes, amplifiers, appliances, pedestals, attachments, and other property and equipment as are necessary and appurtenant to the operation of the cable television system in conformance with the Town's s- specifications. Prior to any construction or alteration, however, Heritage shall file plans with the appropriate Town agencies and utility companies and receive written approval before proceeding. 2. REPRESENTATIONS AND WARRANTIES OF HERITAGE A. Heritage represents and warrants that it will comply with all provisions of the franchise; B. Heritage represents and warrants that neither it nor its representatives or agents have committed any illegal acts or engaged in any wrongful conduct contrary to, or in violation of any federal, state or local law or regulation in connection with the obtaining of this franchise; C. Heritage represents and warrants that it is a corporation licensed to do business in Colorado and has full right and authority to enter into and fully perform the franchise; D. Heritage represents and warrants that all corporate action required to authorize the acceptance of the franchise and execution and delivery of this agreement and all other documents to be executed and/or delivered by Heritage pursuant to the franchise and to authorize the performance by Heritage of all of its obligations under the franchise, and all such other documents to be executed and/or delivered by Heritage have been validly and duly acted on and are in force and effect; E. Heritage represents and warrants that the franchise and all other documents executed and/or delivered by Heritage have been duly accepted and executed; F. Heritage represents and warrants that it has carefully read the terms and conditions of the franchise and accepts the obligations imposed by the terms and conditions of the franchise. 3. EFFECTIVE DATE OF FRANCHISE; EFFECT UPON EXISTING FRANCHISE A. Heritage shall have thirty (30) days from the date of adoption of this ordinance to accept the grant of a franchise by executing the franchise agreement. Such acceptance by Heritage shall be deemed the grant of this franchise for all purposes and immediately upon the taking affect of this franchise agreement, the prior franchise granted to Heritage or their predecessor in interest on , 19 by the passage of Ordinance No. shall be superseded and have no further force and effect; provided however, vested rights relating to billings and the Town's rights to accrue franchise fees shall not be affected thereby; and provided, further, that any criminal proceedings commenced under or pursuant to said -2- _- franchise shall in no manner be affected. In the event acceptance does not take place within thirty (30) days or such other time as the Town might allow, this franchise shall be null and void. B. Upon acceptance of this franchise, Heritage shall be bound by all the terms and conditions contained herein. Heritage shall provide all services and offerings specifically set forth herein to provide cable television services within the Town. C. With its acceptance, Heritage also shall deliver to the Town a certified resolution of Heritage evidencing its power and authority to accept the franchise. Such document shall also describe officers authorized to accept on behalf of Heritage. D. With its acceptance, Heritage shall also pay all costs and expenses incurred by the Town in connection with the renewal process. an itemized statement to Heritage. Costs or expenses of the that time shall be paid promptly by Heritage upon receipt of from the Town. It is the intent of the Town and Heritage th, reimbursed for all costs and expenses in connection with the franchise including any subsequent expenses due to delays or to the grant of the franchise. The Town shall provide Town not identified at an itemized statement ~t the Town be granting of the litigation pertaining E. With its acceptance, Heritage shall also deliver any security deposit, insurance certificates, performance bonds, and equipment grant required herein. 4. TERM The term of the franchise shall be for a period of fifteen (15) years from the effective date, unless sooner terminated as hereinafter provided, at which time it shall expire and be of no further force and effect. 5. FRANCHISE NON-EXCLUSIVE This franchise shall not be construed as any limitations upon the right of the Town to grant to other persons, rights, privileges, or authorities similar to the rights, privileges and authorities herein set forth, in the same or~other streets, alleys, or public ways or public places. The Town specifically reserves the right to grant at any time during the term of this agreement or renewal thereof, if any, such additional franchises on the same or similar terms, for any cable television system as it deems appropriate. 6. CABLE TELEVISION ORDINANCE INCORPORATED All terms, conditions, and provisions of the Town of Vail cable television ordinance shall be deemed to be embodied in this franchise agreement, and the -3- ~- express terms of the ordinance sha~il prevail over conflicting or inconsistent provisions of this franchise agreement. 7. DEFINITIONS The following words and phrases, when used in this agreement, shall, for the purpose hereof have the meanings ascribed to them in this Section. A. "Cable communications system" or system shall mean a non-broadcast facility consisting of a set of transmission paths and associated signal generation, and reception and control equipment, under common ownership and control, that distributes or is designed to distribute to public subscribers cable television services, institutional services, or other communications services, but such terms shall not include: 1) A facility or combination of facilities that serves only to retransmit the television signals of one or more television broadcast signals; 2) A facility or combination of facilities that serves only subscribers in one or more multiple unit dwellings under common ownership, control, or management, unless such facility or facilities use any public right-of-way; 3) A facility of a common carrier which is subject, in whole or in part to the provisions of Title II of the Communications Act of 1934, as amended; except that such facility shall be considered a cable system [other than for the purposes of 47 U.S.C. 541(c)] to tFie extent such facility is used and the transmission of video programming directly to subscribers; or 4) Any facilities of an electric utility used solely for operating its electric utility system. B. "Channel" shall mean a six (6) megahertz (MHz) frequency band which is capable of carrying either one (1) standard video signal, a number of audio, digital or other non-video signals, or some combination of such signals. C. "Downstream" shall mean signals originating at the head end or hub and transmitted to subscribers. D. "Earth station" shall mean equipment used to receive signals from or transmit signals to a communications satellite. E. "Force Majeure" shall mean any delays caused by reason of (1) civil commotion; (2) riots; and (3) acts of God, such as floods, earthquakes and hurricanes. F. "Franchise grant ordinance" shall mean the ordinance granting a franchise to a Grantee. -4- a- G. "Head end" shall mean the facility, including antennas and associated electronics which receives, controls, and switches the electronic information transmitted over the cable communications system. H. "Residential service" shall mean any service delivered by the cable communications system principally to subscribers in their dwelling units. I. "School" shall mean any duly accredited non-profit educational institution, including primary and secondary schools, colleges and universities, both public and private. J. "State-of-the-art" shall mean any cable communications system, components, or•equipment accepted and used in the cable communications industry which is the most modern and advanced equipment generally accepted and used in the cable communications industry. K. "Wire tapping" shall mean the unauthorized reception of a communications signal. L. "Two-way" shall mean the simultaneous transmission of upstream and downstream signals through a cable communications system. 8. SERVICE AREA A. Line Extension Heritage shall offer cable television service to all areas of the Town in accordance with the following line extension policy. In the city limits of the Town as they stand on 1989, Heritage shall, provide service to any dwelling unit or commercial subscriber that is served by the existing system and in other areas where there are at least thirty (30) residential dwelling units or commercial units per mile of cable plant. In other areas annexed to the Town or developed after 1989, Heritage shall provide service to any new dwelling unit or commercial subscriber where there are at least twenty (20) dwelling units or commercial units per proposed additional cable plant mile. Further, in other areas with less than thirty (30) dwelling units or commercial units per proposed cable plant mile, Heritage shall offer a cost-sharing arrangement with residents. Heritage's share (set herein as per subscriber) shall be recalculated annually and based upon then-current costs for labor and materials. Residents desiring cable television services shall contribute the remaining costs for line extensions to provide services to their dwelling units. The Town and Heritage shall derive future contribution amounts based on average -5- a- annual costs for thirty (30) homes per mile, it being understood that the costs for underground not be the same. B. Heritage shall provide service to all annexed areas of the Town within nine (9) months of obtaining easements and appropriate permits. Heritage shall make every reasonable effort to obtain easements within three (3) months after the effective date of such annexation. If easements are unavailable due to circumstances beyond the control of Heritage, Heritage shall make every reasonable effort to find an alternative route to provide cable television service. Heritage shall report periodically to the Town on its progress in providing service to annexed areas of the Town. 9. SYSTEM DESIGN AND CAPACITY A. Present System Overview Heritage will maintain the existing cable communication system as a state-of-the-art system. Parties understand and agree that at the time of this franchise that system consists of a residential network with a capacity of three- hundred (300) MHz. The present system is currently capable of carrying thirty-six (36) channels and there are currently thirty-one (31) activated channels. The broad categories are video and other services as set forth in Attachment A. The current system transmits all basic channels unscrambled so that they are available to cable-ready TV sets and video cassette recorders without the need for a converter. BTSC standard stereo shall be broadcast on all those channels as indicated in Exhibit attached hereto and made a party hereof. Most current equipment in the system and all of the systems new build and rebuild shall be designed for four-hundred-fifty (450) MHz with a capacity of sixty-nine (69) channels. Whether or not the system's design remains "state-of-the-art" shall be determined jointly by the Town and Heritage at the periodic reevaulation sessions set forth in paragraph 44 of the Franchise Ordinance. B. Community Information Service Heritage shall provide a community information service channel which shall be shared with a weather data service. Heritage shall provide to the Town, free of charge, one (1) character generator with two (2) remote keyboards with a minimum of fifty-eight (58) page memory and color graphics. Said equipment shall be located in such public buildings as may be designated by the Town with ability to transmit signals to the head end. The equipment will be installed by Heritage and remain the property of Heritage, and all maintenance, except that required because -6- °- of gross neglect or intentional injury by the Town shall be responsibility of Heritage, provided that the equipment is delivered and picked up at Heritage's repair facility. The community information channel and the equipment referred to above shall be provided within six (6) months from the receipt of a request therefore from the Town. C. Public Educational and Governmental Access In addition to the community service channel, Heritage shall provide, at no cost to the users, at least one (1) specially designated channel available for governmental, educational and public access. In the event that said specially designated access channel is in use by the general public, local educational authorities and local governmental units during seventy-five (75) percent of the weekdays (Monday through Friday) for seventy-five (75) percent of the time for six (6) consecutive weeks for non-character generated programming using film, video or live telecasting, and the Town makes a demand for use of an additional channel for access, Heritage shall have six (6) months in which to make available a new specially designated access channel. D. Technical Standards The minimum technical standards shall be the minimum standards set forth by the Federal Communications Commission in their rules or any rules that supercede such rules. Regardless of the technical standards that may be applicable the system shall be capable of providing to subscribers video and aural signals of consistently good quality. E. Satellite Earth Station The system configuration shall include satellite earth station capability to receive signals simultaneously from all operational U.S. domestic satellites carrying at least four (4) non-duplicated non-premium cable entertainment services. Heritage shall provide a sufficient number of earth stations to receive signals from all operational U.S. communications satellites that generally carry programs available to cable systems throughout the life of the franchise. F. Capacity for Interactive Residential Services The cable communications system shall have the capacity for interactive residential services including, but not limited to, security alarm monitoring, home shopping, energy management, video techs, subscriber pulling, video games, meter reading, and one way or interactive education. The cable system shall also have the capability for providing shop at home and electronic banking services. All customer equipment necessary for such services such as addressable -7- n_ interactive converters, home terminals and home detectors shall be provided to subscribers by Heritage in accordance with established and uniform rate schedules. G. Standby Power Heritage shall provide standby power generating capacity at the cable communications system control center and at major trunk line locations. Heritage shall maintain standby power systems supplies, rated for at least four (4) hours dtaration, throughout the distribution networks. H. Frequency Availability Heritage shall use its best efforts to assure the availability of appropriate frequencies to be used on the cable communications system. Heritage shall at all times during the term of the franchise comply with all rules and regulations promulgated by the FCC regarding frequency usage and cable television system requirements. I. Addressable Capability The cable communications system shall be addressable with capability for users to acquire signal security for selected channels and subchannels through techniques such as signal scrambling or encoding. The addressable features shall be activated at such time as services are provided. 10. RIGHT OF INSPECTION The Town shall, at its own expense, have the right to inspect all construction and installation work performed subject to the provisions of this franchise and shall make such tests as it shall find necessary to insure compliance with the terms of this agreement and other pertinent provisions of the law; provided, however, that the Town shall be permitted to charge Heritage its usual and customary fees for the inspection of construction in public rights-of-way; and provided, further, that such inspection and tests shall not interfere with the provision of subscriber services. Any delays in construction due to the inspection shall not be reason for default. The Town may also have the right to have all construction and installation work performed subject to the provisions of this franchise reviewed by an independent engineer: to determine whether all construction or improvements are in compliance with the franchise; all technical standards are being met; and there is compliance with all applicable Town codes and standards. If such testing establishes that the system does not meet all required technical standards, Heritage shall bear the expense for such testing. -8- a- 11. SYSTEM SERVICES A. Initial Residential Subscribers Services and Programming Attachment A which is incorporated herein by reference describes the composition of the basic service tier and other services which Heritage shall initially provide. In accordance with the Cable Act, Heritage shall, for the term of the franchise, maintain the mix, quality and level of programming set forth in Attachment A. B. Leased Access Channels Heritage shall offer leased access channel capacity at such terms and conditions and .rates as may be negotiated with each lessee subject to the requirements of Section 612 of the Cable Act of 1984 (47 U.S.C., Section 612) as amended. 12. ACCESS AND INSTITUTIONAL SERVICES In order to develop local programming, Heritage hereby agrees to provide the following: A. Local Programming Production Equipment as set forth in Attachment B hereof or Comparable Equipment All equipment so provided shall be new and of the type and brand specified or its equal. All local programming equipment shall remain the property of Heritage but shall be made available for the use of the public, governmental and educational entities pursuant to such rules and regulations as may be promulgated in accordance with paragraph B hereof. All such public access production equipment shall be maintained by Heritage and shall be fully replaced with comparable state-of- the-art equipment as necessary or upon reasonable request of the Town based on obsolescence or usability. B. Production Studio Heritage shall maintain the existing public access production studio (or one similar) containing the equipment specified in Attachment B hereof. Heritage shall adopt business hours which shall provide for use of the studio during weekdays, weekends and evening hours up to a total of forty (40) hours per week. Heritage shall establish rules, if necessary and with the approval of the Town, to ensure that the studio is available equitably to Heritage and governmental, educational and public sectors. Heritage may contract with Vail Community Cable TU Corp. or any successor thereof to manage studio. The public access channels shall be available on a first come, first served basis at no charge to any individual, association, or organization desiring -9- r s- to utilize them; provided, however, that Heritage may deny the right to use such facilities for commercial purposes. C. Staffing and Training Heritage shall provide adequate staffing for the access studio and for training of the public in the use of production equipment. Heritage shall from time to time conduct workshops to train community and access users in television production techniques and equipment. D. Access Financing Access financing shall be set forth in a separate agreement between the Town, Heritage and the Vail Community Television Corporation. E. Access Rules All rules and regulations as may be necessary or desirable relating to the availability of production equipment for use by the public and governmental and educational entities, studio availability and hours of studio availability and channel availability and programming time shall be promulgated by the Town Manager in cooperation with Heritage. 13. GENERAL PROVISIONS The following provisions shall be applicable to the existing cable communications system and to any rebuilt system as contemplated herein upon the effective date of this franchise agreement and shall be applicable throughout the life of the franchise. A. Parental Control Devices Heritage shall provide subscribers upon request the ability to lock out such channels as they may desire. B. Underground Cable Cable shall be installed underground at Heritage's cost where all existing utilities are already underground. Previously installed aerial cable shall be placed underground in concert, and on a cost sharing basis, with affected utilities, when such utilities are converted from aerial to underground construction; provided, however, that Heritage is given reasonable prior notice of such underground placement. C. Minimum Interference All transmission lines, equipment and structures shall be installed and located so as to cause minimum interference with all rights and reasonable convenience of property owners and at all times kept and maintained in a safe and adequate condition, and in good order and repair, Heritage shall, at all times, -10- a- employ necessary and reasonable care and shall install and maintain and use commonly accepted methods and devices for preventing failures and accidents which are likely to cause damage, injury, or nuisances to the public. Suitable barricades, flags, lights, flares, or other devices shall be used at such times and places as are reasonably required for the safety of all members of the public and as detailed in the manual on uniform traffic control devices. D. Notice of Shutdown At least twelve (12) hours before any planned shutdown Heritage shall give notice on all channels when possible of maintenance or major equipment changeouts which require loss of service to five (5) or more customers. E. Free Service Calls Heritage shall not charge for any service call whether the call is system related; provided, however, a charge may be made if the service call is the result of repeated abuse of the equipment or cable by the subscriber. F. Employee Identification Heritage shall provide a standard identification document to all employees including employees of subcontractors who will be in contact with the public. Such documents shall include a telephone number which can be used to verify identification. In addition, Heritage shall use its best efforts to clearly identify all personnel, vehicles and other major equipment that are operating under the authority of Heritage. G. Converters With the existing cable communications system and upon any rebuild thereof, Heritage shall utilize state-of-the-art signal security. Furthermore, Heritage shall, to the extent feasible, construct the system and install equipment which permits the full utilization of cable ready television receivers by subscribers to avoid converter usage, where possible. H. Local Origination Heritage is encouraged to provide local origination programming of a cultural, recreational, athletic, or civic nature. I. Service to Government Heritage shall provide upon request a reasonable number of free drops not to exceed four (4) per building to all government buildings and schools which are passed by the cable plant. -11- ~- 14. SUBSCRIBER RIGHTS AND COMPLAINTS A. At the time an installation or service agreement is to be signed, Heritage shall furnish to each subscriber a written statement that clearly sets forth the following: 1. A complete schedule of rates, fees, charges, and the terms and conditions of service currently applicable to the type of installation and service offered. 2. A complete statement of the subscriber's right to privacy in conformance with Federal or State law. 3. Information concerning the procedures for making inquiries or complaints. 4. The address and telephone number of the Heritage office responsible for handling complaints. B. The business office of Heritage shall have a locally listed telephone number, and at a minimum, be open for business eight (B) hours a day on weekdays and have a sufficient number of lines so that the office is reasonably accessible by telephone and telephone lines are not continuously busy. Heritage business offices shall be located within the Town of Vail boundaries or within a distance of ten (10) miles from the Town of Vail boundaries. C. All complaints shall be handled in accordance with the procedures set forth in the Town of Vail cable ordinance. 15. PRIVACY POLICIES Heritage shall endeavor to operate its business in such a way as to give effect to the privacy rights of each subscriber and user in accordance with the Vail cable television ordinance, the requirements set forth herein and other applicable federal, state and local laws and regulations. 16. FRANCHISE RENEWAL This franchise may be renewed by the Town in accordance with the provisions of the Town of Vail franchise ordinance and applicable federal law. 17. POLICE POWERS In accepting this franchise, Heritage acknowledges that its rights hereunder are subject to the police powers of the Town to adopt and enforce general ordinances necessary to the safety and welfare of the public and it agrees to comply with all applicable general laws and ordinances enacted by the Town pursuant to such power. Any conflict between the provisions of this franchise agreement and any other present or future lawful exercise of the Town's police power shall be resolved -12- a- in favor of the latter, except that any such exercise that is not a general application of the jurisdiction or applies exclusively to Heritage or cable communications system which contains provisions inconsistent with this agreement shall prevail only if, upon such exercise, the Town finds that an emergency exists constituting a danger to health, safety, property, or general welfare or such exercise is mandated by law. 18. FRANCHISE FEE A. Annual Franchise Payment Heritage shall pay to the Town five (5) percent of its annual gross revenues during the period of its operation under the franchise, pursuant to the provisions of the Town of Vail cable television ordinance. If during the term of this agreement, any court, agency or other authority of competent jurisdiction takes any action or makes any direct declaration that adversely affects the amount of the franchise fee as set forth in this Section, the Town and Heritage shall enter into negotiations to amend this franchise agreement to make the Town whole in a manner consistent with said action or declaration by restoring the Town to a position equivalent to that which had held prior to said action or declaration to the extent allowed by law. B. Payments due the Town under this provision shall be computed at the end of each quarter year for that quarter year. Payments shall be due and payable for each quarter or a portion of a quarter year to the Town sixty (60) days after the close of that quarter or a portion of a quarter year. Each payment shall be accompanied by a brief report showing the basis for the computation and such other relevant facts as may be required by the Town. C. No acceptance of any payment by the Town shall be construed as a release or as an accord and satisfaction of any claim the Town may have for further or additional sums payable as a franchise fee or for the performance of any other obligation of Heritage. D. In accordance with the cable television ordinance of the Town of Vail, Heritage shall pay as a grant fee to the together with the application filing fee Town. Heritage shall exercise no rights payment is made. It is understood and a~ the franchise fee and any other payments Town ( ), which reflects the refranchising costs to the under this franchise agreement until such Treed that this payment is in addition to required hereunder. -13- ~- 19. RATES AND CHARGES A. Initial Rates Heritage initial rates and charges, contained in Attachment hereto shall be applied fairly and uniformly to all subscribers in the Town. B. Rate Regulation Rate regulation may apply to the extent that Heritage is not exempt from local rate regulation by preemption of state or federal law. To the extent that state or federal law or regulation may now, or as the same may hereafter be amended, authorize the Town to regulate the rate for any particular service tiers, service packages, equipment or any other services provided by Heritage, the procedures for processing rate increases as set forth in the Town of Vail cable television ordinance shall apply. Heritage shall comply with all notice requirements set forth in the Town of Vail cable television ordinance relating to rate increases and decreases. 20. INSURANCE Certificates or policies evidencing insurance in the amounts required by the Vail cable television ordinance shall be provided by Heritage and shall be filed in the Office of the Town Clerk. Insurance shall cover acts by Heritage, its employees, agents, subcontractors or any other person acting on behalf of Heritage. 21. FORFEITURE OR REVOCATION A. In addition to all of the rights and powers retained by the Town under this franchise agreement, the Town reserves the right to forfeit and terminate the franchise and all rights and privileges of Heritage in the event a substantial breach of its terms and conditions occurs pursuant to Section 20 the Cable Ordinance. B. Disposition of Faci lities In the event this franchise agreement expires, is revoked or otherwise terminated, Heritage shall remove at its own expense all designated portions of the cable communications system from all streets and public ways within the Town. In removing its plant, structures and equipment, Heritage shall refill, at its own expense, any excavation that shall be made by it and shall leave all public ways in as good a condition as that prevailing prior to Heritage's removal of its equipment and appliances without affecting tf~e electrical or telephone or other utility lines, wires, pipes or attachments. The Town shall inspect and approve the condition of the public ways, cables, wires, attachments and poles after removal. The liability, indemnity and insurance as provided herein and in the Vail cable television -14- °- ordinance shall continue in full force and effect during the period of removal and until full compliance by Heritage with the terms and conditions of this paragraph and this ordinance. In the event of a failure by Heritage to complete any work required by this franchise agreement or the Vail cable television ordinance, or any other work required by Town law or ordinance within the time as may be established and to the satisfaction of the Town, the To!an may cause such work to be done. Heritage shali reimburse the Town the costs thereof within thirty (30) days after receipt of an itemized list of such costs. C. Foreclosure Upon the foreclosure or other judicial sale of all or of substantial part of the cable communications system facilities, or upon the termination of any lease covering all or a substantial part of the cable communications system, or upon the occasion of additional events which effectively cause termination of the system's operation, Heritage shall notify the Town of such fact and such notification or the occurrence of such terminating events shall be treated as a notification that a change in control of Heritage is taking place and the appropriate provisions of the Vail cable television ordinance shall apply. D. Receivership The Town shall have the right to cancel this franchise one hundred twenty (120) days after the appointment of a receiver, or trustee, to take over and conduct the business of Heritage, whether in receivership, reorganization, bankruptcy or other action or proceeding, unless such receivership or trusteeship shall have been vacated prior to the expiration of said one hundred twenty (120) days, or unless: 1. Within one hundred twenty (120) days after the election or appointment such receiver or trustee shall have fully complied with all the provisions of the franchise and remedied any defaults thereunder; and 2. Within one hundred twenty (120) days such receiver or trustee shall have executed an agreement duly approved by the court having jurisdiction whereby such receiver or trustee assumes and agrees to be bound by each and every provision of this franchise agreement. 22. COOPERATION The parties recognize that it is in their best interest for the cable communications system to be operated as efficiently as possible and for any required rebuilding of the system to occur in accordance with the requirements and schedule -15- ~- as set forth in this agreement. To achieve this, the parties agree to cooperate with each other in accordance with the terms and provisions of this franchise agreement. Should either party believe that the other is not acting kindly or reasonably in accordance with the applicable regulations and procedures in responding to a request for action, that party shall notify the agents designated for that purpose by the other. The agent will use its best effort to facilitate the particular action requested. 23. WAIVER The failure of the Town at any time to require performance by Heritage of any provision hereof shall in no way affect the right of the Town hereafter to enforce the same. Under no circumstances shall the waiver of the Town of any breach or any provision hereof be taken or held to be a waiver of any succeeding breach of such provision or as a waiver of the provision itself. 24. CUMULATION OF REMEDIES The rights and remedies reserved to the Town by this franchise agreement are cumulative and shall be in addition to and not in derogation of any other rights or remedies which the Town may have with respect to the subject matter of this franchise agreement, and a waiver thereof at any time shall have no effect on the enforcement of such rights or remedies at a future time. 25. COMPLIANCE WITH FEDERAL, STATE, AND LOCAL LAWS Heritage, its employees, and agents shall be familiar with all federal, state, local and municipal laws, ordinances, rules and regulations which in any manner affect those engaged or employed in the work, or the materials or equipment used in or upon the work or in any way affect the work and no plea of misunderstanding will be considered upon account of the ignorance thereof. Heritage's contractors, employees and agents shall comply with all applicable federal, state and local laws, rules and regulations issued thereto and Heritage shall indemnify the Town against arty loss, liability, or damage occasioned by reason of its violation of this Section. 26. NOTICES All notices from Heritage to the Town pursuant to this agreement shall be sent to 75 South Frontage Road, Vail, Colorado 81657. Heritage shall maintain a local office and telephone number for the conduct of matters related to the franchise. All notices to Heritage shall be sent to Heritage Cablevision, 2195 Ingersoll Ave., Des Moines, Iowa 50312, Attn: Legal Department. -16- a- 27. CAPTIONS Captions to Sections throughout this agreement are solely to facilitate the reading and reference to Sections and provisions of the agreement. Such captions shall not affect the meaning or interpretation of the agreement. 28. COMPANY SHALL HOLD TOWN HARMLESS Heritage shall save and keep the Town and its officials, boards, commissions, agents and employees free and harmless from any loss, expense or damage to person or property arising out of or resulting from any provision or requirement of the franchise or exercising its rights or performing its duties under this franchise. . 29. FORCE MAJEURE Both parties' obligation is to perform any services or complete any installation by any specific date shall with respect to each such obligation, be deferred by the amount of time that the other party deems reasonable under the circumstances for the performance of such service or completion of such installation when delayed by "Force Majeure". In each such instance, it shall be the burden of the party seeking a delay of its obligations to perform to prove to the reasonable satisfaction of the other party the reasonableness of the delay. 30. TIME IS OF THE ESSENCE Whenever this franchise agreement sets forth any time for any act to be performed by either of the parties, such time shall. be deemed to be of the essence of this agreement. 31. CONSTRUCTION OF AGREEMENT This agreement shall be governed, construed and enforced in accordance with the laws of the State of Colorado, except that the parties' respective rights and obligations hereunder shall be subject to any applicable provisions of the Cable Communications Policy Act of 1984, as now existing or as the same may be from time to time hereinafter amended, and the applicable provisions of the Communications Act of 1934 as hereinafter amended, any applicable rules, regulations and orders of the Federal Communications Commission and any applicable rules, regulations, legislation or orders of any other public body having jurisdiction over the subject matter hereof. 32. NO JOINT VENTURE Nothing herein shall be deemed to create a joint venture or principle agent relationship between the parties and neither party is authorized to, nor shall -17- •- either party act toward third persons or the public in any manner which would indicate any such relationship with the other. 33. ENTIRE AGREEMENT This agreement and all attachments hereto and the Vail cable television ordinance as incorporated herein, represent the entire understanding and agreement between the parties with respect to the subject matter hereof, supersede all prior oral negotiations between the parties and can be amended, supplemented, modified or changed only by an agreement in writing which makes special reference to this agreement or to the appropriate ai;ta'chment or document which is signed on behalf of both parties. 34. SEVERABILITY If any section, subsection, sentence, clause, or phrase or portion of this agreement is, for any reason held invalid or unconstitutional by any court of competent jurisdiction, such portion shall be deemed a separate, distinct and independent provision and such holding shall not affect the validity of the remaining portions of this agreemE~nt. IN WITNESS WHEREOF, the parties have caused this agreement to be signed on the day and year first written above. TOWN OF VAIL, a Colorado municipal corporation By: Rondall V. Phillips, Town Manager CABLEVISION VI, INC. d/b/a HERITAGE CABLEVISION By: Kevin L. Rice, Vice President/Operations -18- TOWN OF VAIL CABLE COMMUNICATIONS ORDINANCE DRAFT 2/13/89 1. This chapter shall be known as the Cable Communications Ordinance. 2. PURPOSE The purposes of this ordinance are: a. Provide for the franchising and regulation of cable television within the Town of Vail. b. Provide fora cable communications system that will meet the current needs of the Town and that can be improved and upgraded to meet future needs. c. Provide for the payment of fees and other valuable consideration to the Town for the use of the public ways and for the privilege to construct and operate cable communications systems. d. Provide for the regulation by the Town of certain rates to be charged to subscribers for certain cable communications services, as permitted by law. e. Provide for the development of cable communications as a means to improve communication between and among the members of the public and public institutions of the Town. f. Provide remedies and prescribe by penalties for violation of this ordinance and any franchise granted hereunder. 3. APPLICABILITY This ordinance is applicable to any application for a cable franchise filed on or after the effective date of this ordinance and to any such franchise granted thereafter. 4. DEFINITIONS For the purpose of this ordinance the following terms, phrases, words and the derivations shall have the meanings given herein. When not inconsistent with the context, words used from the present tense include the future, words in the plural number include the singular and words in the singular number include the plural number. The word shall is mandatory and the word may is permissive. Words not defined shall be given their common and ordinary meanings. a. "Access channel" shall mean any channel set aside for public use, educational use, or governmental use without a channel use charge. b. "Access user" shall mean any person or entity entitled to make use of an access channel consistent with the intended purpose of the channel. c. "Application" shall mean a proposal seeking authority to construct and operate a cable communications system within the Town pursuant to this ordinance. ._ It shall include the initial proposal plus all related subsequent amendments and correspondence with the Town. d. "Basic service" shall mean subscriber cable television services which includes the delivery of local television broadcast signals as required by the FCC, access channels, lease channels and local origination channels as covered by the regular monthly charge paid by all subscribers to any service tier excluding premium services, two way services, and FM radio services. e. "Cable television services" shall mean the one way transmission of video programming and associated non-video signals to subscribers together with subscriber interaction, if any, which is provided in connection with the video programming. f. "Cable communications system" or system shall mean a non-broadcast facility consisting of a set of transmission paths and associated signal generation, and reception and control equipment, under common ownership and control, that distributes or is designed to distribute to public subscribers cable television services, institutional services, or other communications services, but such terms shall not include: 1) A facility or combination of facilities that serves only to retransmit the television signals of one or more television broadcast signals; 2) A facility or combination of facilities that serves only subscribers in one or more multiple unit dwellings under common ownership, control, or management, unless such facil ity or facilities use any public right-of-way; 3) A facility of a common carrier which is subject, in whole or in part to the provisions of Title II of the Communications Act of 1934, as amended; except that such facility shall be considered a cable system [other than for the purposes of 47 U.S.C. 541(c)] to the extent such facility is used and the transmission of video programming directly to subscribers; or 4) Any facilities of an electric utility used solely for operating its electric utility system. g. "Town" is the Town of Vail, Colorado. h. "Channel" shall mean six (6) Megahertz (Mhz) frequency band which is capable of carrying either one standard video signal, a number of audio, digital or other non-video signals or some combination of such signals and which is at least six (6) Mhz wide. i. "Connection" shall mean the attachment of the drop to the radio or television set or other communication device of the subscriber. -2- ~- j. "Converter" shall mean an electronic tuning device which converts transmitted signals to a frequency which permits the reception on an ordinary television receiver. k. "Council" or "Town Council" shall mean the governing body of the Town of Vail. 1. "Drop" shall mean the cable that connects a subscriber's terminal to the nearest feeder line of the cable communications system. m. "Easement" shall mean a right to use all public rights-of-way including public utility easements n. ','Feeder line" shall mean the coaxial or fiber optic cable running from the trunk line to line extenders and taps for the purpose of interconnection to individual subscribers. o. "FCC" shall mean the Federal Communications Commission. p. "Gross revenue" shall mean all operating revenue from the cable communications system derived directly or indirectly by a Franchisee, its affiliates, subsidiaries, parent, and any person in which the Franchisee has a financial interest in association with the provision of cable communications services with the Town, including but not limited to, service tier monthly fees, pay service fees in excess of programming vendor fees, institutional service fees, installation and reconnection fees, leased channel fees, converter rentals, studio rental, production equipment and personnel fees, advertising revenues, copyright fees; provided, however, that this shall not include any taxes on services furnished by the Franchisee payable to the State of Colorado or any other governmental unit and collected by the Franchisee on behalf of said governmental unit, or any revenues from the provision of cable communications services outside the Town, or any revenues from sale of capital assets or lease of property for purposes unrelated to cable communications system. q. "Installation" means the act of connecting the system from the feeder cable to the subscriber's receiver so that the installation is to the subscriber's terminal or receiver. r. "Institutional services" shall mean one and two way non-entertainment transmission services for businesses, public agencies and community institutions. Such services include, but are not limited to, video transmission and voice and data communications. -3- ~_ s. "Leased channel" or "leased access channel" shall mean any channel or part of a channel, available for commercial use on a fee basis by persons or entities other than a Franchisee. t. "Franchise" shall mean the non-exclusive right and authority to construct, maintain, and operate a cable communications system through use of the public streets, dedications, public utility easements, or other public right-of-way or public places in the Town pursuant to a contractual agreement executed by the Town and a Franchisee. u. "Franchisee" or "Grantee".refers to an entity authorized to construct, or operate, or, both, a cable communications system within the Town pursuant to this chapter including any lawful successor, transferee, or assignee of the original Grantee. v. "Monitoring" shall mean observing a communications signal carried on a cable communications system, or the absence of such a signal, by any person without regard to whether such observation is by visual or electronic means. Monitoring shall not include system-wide sweeps of the cable communications system for purposes of verifying the integrity of the system and controlling return path of the transmissions. w. "Pay Television" shall mean the delivery over the system of per channel audio-video signals to subscribers for a fee or charge in addition to the charge for basic service. x. "Person" shall mean any person, firm, partnership, association, corporation, company, or organization of any kind. y. "Service tier" shall mean a specific set of cable subscriber services which are made available as, and only as, a group for purchase by subscribers at a specific rate for the group. z. "Street" or "public way" shall mean the surface and the space below and above any public street, road, highway, path, sidewalk, alley, court, or easement now or hereafter held by the Town for the purpose of public travel or public utilities and shall include public easements or rights-of-way. aa. "Subscriber" shall mean a recipient of cable television service or other services provided over a cable communications system. bb. "User" shall mean a party utilizing a cable communications systems facility for the purpose of production or transmission of material or information to subscribers. -4- a_ 5. REQUIREMENT OF A FRANCHISE It shall be unlawful to construct, install, maintain, or operate a cable communications system or part of a cable communications system within the Town without a valid franchise obtained in accordance with the provisions of this chapter. 6. GENERAL FRANCHISE CHARACTERISTICS Any franchise issued in accordance with the provisions of this chapter shall be deemed to: a: Authorize use of the public ways for installing cables, wires, lines and other facilities in order to operate a cable communications system, but shall neither expressly nor implied be deemed to authorize the Grantee to provide service to, or install cable, wires, lines, or any other equipment or facilities upon private property without owner consent, or to utilize publicly or privately owned utility poles or conduits without a separate agreement with the owners therefore; b. Be non-exclusive, and shall neither expressly nor implied be deemed to preclude the issuance of subsequent franchises to operate one or more cable communications systems within the Town; and c. Convey no property right to the Franchisee or right to renewal except as required by Federal and State law. 7. FRANCHISE AS A CONTRACT A franchise issued pursuant to the provisions of this chapter shall be deemed to constitute a contract between the Franchisee and the Town. The Franchisee shall be deemed to have contractually committed itself to comply Frith the terms, conditions, and provisions of the franchise documents, and with all rules, orders, regulations, and determinations applicable to the franchise which are issued, promulgated, or made pursuant to the provisions of this chapter. 8. CONFLICTS a. All terms, conditions and provisions of this chapter and the application for a franchise shall be deemed to be embodied in a franchise, and conflicts in terms, conditions or provisions between these documents shall be resolved as follows: 1) The express terms of this chapter shall prevail over conflicting or inconsistent provisions of the franchise; 2) The express terms of the franchise shall prevail over conflicting or inconsistent provisions in the application and any request for proposals; and -5- ._ 3) ~ The express tef•ms of any request for proposals shall prevail over conflicting or inconsistent provisions in the application for the franchise. b. The provisions of the franchise shall be liberally construed in order to effectuate its purposes and objectives consistent with this chapter and the public interest. In the event one or more provisions of the franchise or this chapter or subsequently found to be unlawful, null and void or unenforceable, the Town shall, at its sole option, have the right to consider said provisions severed from the franchise so as to continue the franchise's effectiveness, in accordance with the terms of this chapter. Any franchise agreement will be construed under the laws of the State of Colorado. 9. FRANCHISEE SUBJECT TO POLICE POWER A Franchisee shall, at all times during the life of a franchise, be subject to all lawful exercise of the police power by the Town and through such lawful regulations as the Town shall hereafter enact. The construction, operation, and maintenance of the system shall also be in full compliance with all other applicable rules and regulations now in effect or hereafter adopted by the United States, the State of Colorado, or any agency of said governments. 10. FRANCHISE VALIDITY A Grantee shall agree, b,y the acceptance of a franchise, to accept the validity of the terms and the conditions of this ordinance and the franchise in their entirety and that the Grantee will not, at any time in any claim or proceeding, challenge any term or provision of this ordinance or the franchise as unreasonable or arbitrary or argue that the Town did not have the authority to impose such term or condition. 11. FILING OF APPLICATIONS Applications for a cable communications franchise will be considered pursuant to the following procedures: a. An application may be filed at any time or pursuant to a request for proposals issued by the Town. b. Upon the filing of an application, the Town shall publish notice of the filing in a newspaper of general circulation in the Town. Any person wishing to submit any comment on the applicai;ion shall, within fifteen (15) days of the date of notice of the first application, file such comment with the Town Manager. c. All applications to be acceptable for filing must be accompanied by a filing fee of ten thousand sixty dollars ($10,060). The Town shall apply all filing fees received against all costs associated with its evaluation of any pending -6- a_ applications pursuant to this chapter. In the event that total costs are less than the total filing fees, the Town shall refund a portion of the filing fee on a prorated basis for each Applicant within forty-five (45) days after franchise grant. The Town shall furnish applicant with documentation of all costs incurred at that time. 12. CONTENT OF APPLICATIONS To be acceptable for filing, an application must conform to any applicable request for proposals and all the information specified therein. Where an application is not filed pursuant to a request for proposals shall contain at minimum, the following information: a. Identification of the ownership of the Applicant, if not a natural person, including the names and addresses of all persons with one (1) percent or more ownership interest and the ultimate controlling natural persons and identification of all officers and directors and any other primary business affiliation of each. b. An indication whether or not the Applicant, or any entity controlling the Applicant, including any officer of a corporation or a major stockholder thereof, has been adjudged bankrupt, has had a cable franchise revoked, or been found guilty by any court or administrative agency in the United States of: 1) A violation of a security or antitrust law; or 2) A felony or any other crime involving moral turpitude. Identify any such person or entity and fully explain the circumstances. c. A demonstration of the Applicant's technical and financial ability to construct and operate the proposed cable facility. d. A description of the physical facility proposed, including channel capacity including one way and two way, if any, the area to be served, a summary of technical characteristics, and head end and access facilities. e. A description relating how any construction will be implemented, identification of areas having above ground or below ground cable facilities, the proposed construction schedule, and a description where appropriate, indicating how service will be converted from any existing facility to a new facility. f. A description of the services to be provided over the system, including identification of television signals, both broadcast and non-broadcast, to be carried and all non-television services to be provided initially. Where service will be offered by tiers, identify the signals or services, or both, to be included on each tier. -7- a_ g. The-proposed rates to be charged, including rates for each service tier, as appropriate, and charges for installation, converters and other services. h. Information as necessary to demonstrate compliance with all relevant requirements contained in this chapter. i. A demonstration stating how the proposal is reasonable to meet the future cable related community needs and interests. In particular, the application should describe how the proposal will satisfy the needs as analyzed in any recent community needs assessment commissioned by the Town. j: A demonstration how the proposal was designed to be consistent with all federal and state requirements. k. Pro forma financial projections for each year of the franchise term. The projections shall include a statement of income, balance sheet, statement of sources and use of funds, and schedule of capital additions. All significant assumptions shall be explained in notes or supporting schedules set accompanying the projections. 1. A complete list of all cable communications systems in which the Applicant or a principle thereof holds an equity interest. m. An affidavit of the Applicant or duly authorized officer thereof certifying, in a form acceptable to the Town, the truth and accuracy of the information contained in the application. n. In the case of an application by an existing Franchisee for renewed franchise, a demonstration that said Franchisee has substantially complied with the material terms of the existing franchise and with applicable law. o. Any person who files an application with the Town for a cable communications franchise shall forewith, at all times, disclose to the Town, in writing, the names, addresses, and occupations of all persons who are authorized to represent or act on behalf of the Applicant in those matters pertaining to the application. The requirement to make such disclosure shall continue until the Town shall have rejected an Applicant's application or until an Applicant withdraws its application. 13. CONSIDERATION OF APPLICATIONS a. The Town shall consider each application for a franchise with the applications found to be acceptable for filing and in substantial compliance with the requirements of this chapter and any applicable request for proposals. In evaluating an application, the Town will consider, among other things, the Applicant's past service record in other communities, the nature of the proposed -8- a_ facilities and services, including rates to be charged therefor, and whether the proposal is adequate to meet the future cable related community needs and interests of the citizens of the Town. Where the application is for a renewed franchise, the Town shall consider whether: 1) The cable operator has substantially complied with the material terms of the existing franchise and with applicable law; 2) The quality of the operator's service, including signal quality, response to consumer complaints, and billing practices, but arithout regard to the mix, quality, or level of cable services or other services provided over the system, has been reasonable in light of community needs; 3) The operator has the financial, legal and technical ability to provide the services, facilities and equipment as set forth in the operator's proposal; and 4) The open°ator's proposal is reasonable to meet the future cable related community needs and interests, taking into account the cost of meeting such needs and interests. b. Where the Town determines that an Applicant's proposal, including the proposed service area, would serve the public interest, and may grant a franchise to the Applicant. The franchise agreement will constitute a contract, freely entered into, between the Town and the Grantee. Said franchise agreement shall incorporate by reference the relevant provisions of this chapter. Any such franchise must be approved by ordinance of the Town Council pursuant to the ordinances of the Town and the Charter of the Town. c. In the course of considering an application for renewed franchise, the Council shall hold a public hearing, consistent with the provisions of 47 U.S.C., Section 626 as existing or as may from time to time be amended. d. A franchise granted pursuant to this chapter shall not take effect until the Applicant pays a grant fee to the Town. The grant fee shall be equal to the Town's reasonable direct costs in the franchising process, less the application filing fee received. The Town shall provide to the Grantee a statement summarizing such costs prior to the execution of the franchise. 14. ACCEPTANCE A franchise and its terms and conditions shall be accepted by a Grantee by written instrument, in a form acceptable to the Town Attorney, and filed with the Town Clerk within thirty (30) days after the granting of the franchise by the Town. In its acceptance, the Grantee shall declare that it has carefully read the terms -9- a_ and conditions of-this ordinance and the franchise and accepts all of the terms and conditions of this ordinance and the franchise and agrees to abide by same. In accepting a franchise, a Grantee shall indicate that it has relied upon its own investigation of all relevant facts, that it was not induced to accept the fr°anchise and that it accepts all reasonable risks relating to the interpretation to the franchise. 15. FRANCHISE TERM The term of a franchise shall be as specified in the franchise agreement, but it shall not exceed (._) years. If a Franchisee seeks authority to operate a cable system in the Town beyond the term of its franchise, it shall file an application for a renewed franchise not later than thirty (30) months prior to the expiration of its franchise. 16. FRANCHISE FEE a. The franchise fee in consideration of the privilege granted under a franchise for the use of the public ways and the privilege to construct and operate a cable communications system, shall pay to the Town five (5) percent of its annual gross revenues during the period of its operation under the franchise. b. A Franchisee shall file with the Town, thirty (30) days after the last day of each quarter, a financial statement showing the gross revenues received by the Franchisee during the preceding quarter. A Franchisee shall pay the quarterly portion of the franchise fee to the Town on or before the time such financial statement is due to be filed. A Franchisee shall also file, no later than ninety (90) days after the end of each of the Franchisee's fiscal years, the Franchisee's financial statements for the preceding year, certified by an officer of the Franchisee. Any franchise fee payment in adjustment for any shortfall of the total quarterly payments for the year shall be made at that time. Adjustments for any overpayment shall be by credit to subsequent quarterly payments. c. The Town shall have the right consistent with the provisions of this chapter to inspect a Franchisee's income records, to audit any and all relevant records, and to recompute any as determined to be payable under the franchise and this ordinance. d. In the event that any franchise payment is not received by the Town on or before the applicable date, interest shall be charged from such due date at an annual interest rate then chargeable for unpaid federal income taxes (26 U.S.C., Section 6621). In addition to the foregoing, the Franchisee shall pay a late charge of five (5) percent of the amount of such payment. Interest and late charges will -10- -- not be chargeable to the Franchisee for additional payment required under the yearly adjustment, provided that such payment does not exceed ten (10) percent of the total monthly payments made during the year. In the event such payment exceeds ten (10) percent, the Franchisee shall be liable for interest and late charges for the entire amount. e. In the event a franchise is revoked or otherwise terminated prior to its expiration date, the Franchisee shall file with the Town, within ninety (90) days of the date of revocation or termination, an audited financial statement showing the gross revenues received by the Franchisee since the end of the previous year and shall. make adjustments at that time for the franchise fees due up to the date of revocation or termination. 17. INSURANCE, BONDS, INDEMNITY a. Upon the granting of a franchise and following simultaneously the filing of the acceptance of the franchise and at all times during the term of the franchise including the time for removal of facilities or management as a trustee as provided for herein, the Franchisee shall obtain, pay all premiums for, and deliver to the Town written evidence of payment of premiums for and the originals of the following: 1) A general comprehensive public liability policy or policies indemnifying, defending, and saving harmless the Town, its officers, boards, commissions, agents, or employees from any and all claims by any person whatsoever, including the costs, defenses, attorneys fees, and interest arising therefrom on account of injury to or death of a person or persons occasioned by the operations of the Franchisee under the franchise herein granted, or alleged to have been so caused or occurred, with a minimum liability of one million dollars ($1,000,000) per personal injury or death of any one (1) person and three million dollars ($3,000,000) for personal injury ar death of any two (2) or more persons in any one (1) occurrence. The policy shall be endorsed adding coverage against all claims for personal injury liability offenses. 2) A property damage insurance policy or policies indemnifying, defending, and saving harmless the Town, its officers, boards, commissions, agents, and employees from and against any and all claims by any person whatsoever, including the costs, defenses, attorneys fees, and interest arising therefrom, for property damage occasioned by the operation of the Franchisee under the franchise herein granted, or alleged to have been so caused or occurred, with a minimum liability of five hundred thousand dollars ($500,000) for property damage to the -11- a_ property of any one (1) person and one million dollars ($1,000,000) for property damage to the property of two (2) or more persons in any one (1) occurrence. 3) A performance bond or bonds in favor of the Town with good and sufficient surety approved by the Town in the sum set forth in the franchise agreement conditioned upon the faithful performance and discharge of the obligations imposed by this ordinance and the franchise awarded hereunder from the date hereof. The amount of the bond may be reduced as any construction that is required is completed, consistent with the franchise agreement. b: The bond requirements set .forth above shall no longer apply upon completion of construction and inspection by the Town as follows: (1) Franchisee shall give notice to the Town at such time as Franchisee has completed the construction. (2) Upon receipt of notice, the Town shall have sixty (60) days to receive a written report from an independent engineer; provided, however, if the Town fails to receive such a written report within the sixty (60) days the completion of construction shall be deemed to have taken place, unless the failure to receive such a report is due to unforeseen events, acts of God, or events beyond the reasonable control of the Town. (3) Notwithstanding anything to the contrary, the Town may condition completion of the construction upon receipt of a written report from an independent engineer. The completion of the system upgrade or system rebuild shall not be deemed to have taken place until the independent engineer reports the following: (a) All construction or improvements contemplated by the Franchisee have been completed or otherwise satisfactorily resolved; (b) Satisfactory test results using the technical standards set forth in this franchise agreement at up to ten (10) widely separated subscriber drops selected by the independent engineer and using the following tests: 1) Signal level 2) Hum 3) Bypass responsive system 4) Carrier to noise of system 5) TASO picture quality (2 or better) (c) Compliance with all applicable codes and standards. (d) Carriage of the basic service as available, as set forth in this franchise ordinance. -12- ._ c. All bonds and insurance policies called for herein shall be in a form satisfactory to the Town Attorney. The Town may at any time, if it deems itself insecure, require a Franchisee to provide additional sureties to any and all bonds or to replace existing bonds with new bonds for good and sufficient surety approved by the Town. d. A Franchisee shall, at its sole cost and expense, indemnify and hold harmless the Town, its officials, boards, commissions, agents and employees against any and all claims, suits, causes of action, proceedings, and judgments for damage arising out of the operation of the cable communications system by Franchisee under the franchise., These damages shall include, but not be limited to, penalties arising out of copyright infringements and damages arising out of any failure by Franchisee to secure consent from the owners, authorized distributors or licensees or programs to be delivered by the Franchisee's communications system whether or not any act or omission complained of is authorized, allowed, or prohibited by the franchise. Indemnified expenses shall include, but not be limited to, all out-of-pocket expenses, such as costs and attorneys fees, and shall also include the reasonable value of any services rendered by the Town Attorney or his or her assistants or any employees of the Town. e. No Franchisee shall permit any policy or bond to expire and the Franchisee, not less than thirty (30) days prior to its expiration shall deliver to the Town a substitute renewal or replacement bond or bonds in conformance with the provisions of this ordinance. 18. LETTER OF CREDIT a. The Town may at its discretion require that a Franchisee obtain a letter of credit. When and if the Town should so require, the Franchisee shall deposit with the Town a letter of credit from a financial institution approved by the Town in the amount of fifty thousand dollars ($50,000). The letter of credit may not be revoked or terminated during the term of the franchise except with the written approval of the Town. The form and the content of such letter of credit shall be approved by the Town Attorney. The letter of credit shall be used to insure the faithful performance by the Franchisee of all provisions of the franchise and of this ordinance; compliance with all orders, permits, and directions of any agency, commission, board, department, division, or office of the Town having jurisdiction over its acts or defaults under this license; and the payment by the Franchisee of any claims, liens, and taxes due the Town or other municipalities which arise by reason of the construction, operation or maintenance of the system. -13- a_ b. The letter of credit shall be maintained by the Franchisee at twenty five thousand dollars ($25,000) during the entire term of the franchise as the Town may require, even if funds are drawn against it pursuant to this ordinance. c. The letter of credit shall contain the following endorsement: "It is hereby understood and agreed that this letter of credit may not be cancelled by the surety nor the intention not to renew be stated by the surety until thirty (30) days after the receipt by the Town Attorney, by certified mail, of a written notice of such intention to cancel or not to renew. d: At the Town's option it may draw against the letter of credit for any unpaid liquidated damages, franchise fees, or other amounts owing to it under the franchise which are thirty (30) days or more past due. The Town shall notify the Franchisee in writing at least ten (10) days in advance of drawing upon the letter of credit. 19. LIQUIDATED DAMAGES In the event that the Town finds the Franchisee is in violation of any material obligation under this ordinance or the franchise, the Town shall notify the Franchisee in writing of such apparent violation and require the Franchisee to cure the default within a reasonable time. The Franchisee shall respond in writing to the notice of violation within ten (10) working days from receipt of such notice setting forth the steps taken to correct or propose to correct the violation. The Town may extend the time for such response upon a showing of just cause by the Franchisee. Franchisee may, within three (3) days of receipt of such notice, notify the Town that there is a dispute as to whether a violation or failure has in fact occurred. Such notice by the Franchisee to the Town shall specify with particularity the matters disputed by the Franchisee and shall stay the running of the above described time. The Town shall hear the Franchisee's dispute at a regularly scheduled meeting within a reasonable period of time. If after hearing the dispute, the claim is upheld by the Town, Franchisee shall have five (5) days from such a determination to remedy the violation or failure. The Town may assess penalties as follows: a. Up to one hundred dollars ($100) per day for construction related violations. b. Up to fifty dollars ($50) per day for recurring violations. c. Up to five hundred dollars ($500) for other violations. The penalties set forth herein are in addition to all other rights of the Town whether reserved by this franchise ordinance or authorized by law and no -14- ._ action, proceeding or exercise oi` a right with respect to such penalty shall affect any other right the Town may have. It shall not be considered a violation should the failure to comply with any obligation of this ordinance or the franchise agreement occur without fault of the Franchisee or occurs as a result of circumstances beyond the Franchisee's control. 20. FORFEITURE AND TERMINATION a. In addition to all other rights and powers retained by the Town under this ordinance and any franchise issued .pursuant thereto, the Town reserves the right to forfejt and terminate the franchise and all rights and privileges of the Franchisee in the event of substantial breach of its terms and conditions. A substantial breach by the Franchisee shall include, but shall not be limited to, the following: 1) An uncured violation of any material provision of this ordinance or franchise issued thereunder, or any material rule, order, regulation, or determination of the Town made pursuant thereto; 2) An attempt to evade any material provision of the franchise or practice of any fraud or deceit upon the cable communications system customers and subscribers or upon the. Town; 3) Failure to begin or substantially complete any system construction or system extension as set forth in the franchise; 4) Failure to provide the mix, quality, and level of services promised in the application or specified in the franchise or a reasonable substitute therefor; 5) Failure to restore service after ten (10) consecutive days of interrupted service except when approval of such interruption is obtained from the Town; 6) Material misrepresentation of fact in the application for, or during negotiation relating to, the franchise; 7) Failure to provide surety and indemnity as required by the franchise or this chapter. 8) If Heritage becomes insolvent, unable or unwilling to pay its debts or is adjudged to be bankrupt. b. None of the foregoing shall constitute a major breach if a violation occurs which is without fault of the Franchisee or occurs as a result of circumstances beyond the Franchisee's control. The Franchisee shall not be excused -15- a- by mere economic hardship nor by the nonfeasance or malfeasance of its directors, officers, agents, or employees; provided, however, that damage to equipment causing service interruption shall be deemed to be the result of circumstances beyond the Franchisee's control if it is caused by any negligent act or unintended omission of its employees, assuming proper training or agents, assuming reasonable due diligence in their selection, or sabotage or vandalism or malicious mischief by its employees or agents. The Franchisee shall bear the burden of proof in establishing the existence of such conditions. c. The Town shall make a written demand by certified mail that the Franchisee comply with any such provision, rule, order or determination under or pursuant to the franchise. If a violation of the franchise continues for a period of thirty (30) days following such written demand without written proof that the corrective action has not been taken or is being actively and expeditiously pursued, the Town may consider terminating the franchise; provided, however, a written notice thereof shall be given to the Franchisee at least fifteen (15) days in advance and the Franchisee must be given an opportunity to appear before the Council to present its ar°guments. Should the Town determine, following the public hearing, that the violation by the Franchisee was the fault of the Franchisee and within the Franchisee's control, the Town may, by resolution, declare that the franchise be forfeited and terminated; provided, however, the Town may in its discretion, provide an opportunity for the Franchisee to remedy the violation and come into compliance with the franchise and this ordinance so as to avoid the termination. 21. FORECLOSURE Upon the foreclosure or other judicial sale of all or a susbstantial part of the cable communications system facilities, or upon the termination of any lease covering all or a substantial part of the cable communications system, or upon the occasion of additional events which effectively cause termination of the system's operation, the Franchisee shall notify the Town of such fact, and such notification or the occurrence of such terminating events shall be treated as a notification that a change in control of the franchise has taken place and the provisions of this ordinance governing the consent of the Town to such change and control other franchise shall apply. 22. RECEIVERSHIP The Town shall have the right to cancel their franchise issued one hundred twenty (120) days after the appointment of a receiver, or trustee, to take over and conduct the business of the Franchisee, whether in receivership, reorganization, -16- ._ bankruptcy, or other action or proceeding unless such receivership or trusteeship shall have been vacated prior to the expiration of said one hundred twenty (120) days, or unless: a. bJithin one hundred twenty (120} days after the election or appointment, such receiver or trustee shall have fully complied with all of the provisions of this ordinance and remedied any defaults thereunder; and b. bJithin said one hundred twenty (120) days, such receiver or trustee shall have executed an agreement duly approved by the court having jurisdiction whereby such receiver or trustee assumes and agrees to be bound by each and every provision of this ordinance and the franchise granted to the Franchisee. 23. REMOVAL OF CABLE COhif~UNICATIONS SYSTEM At the expiration of the term for which a franchise is issued hereunder is granted or upon its termination as provided herein, the Franchisee shall forewith, upon notice by the Town, remove at its own expense all designated portions of the cable communications system from all streets and public ways within the Town, and shall restore said streets and public ways to their former condition; provided, however, the Franchisee shall have the right to sell its physical plant to a subsequent Franchisee, subject to Town approval, in which case said plant need not be removed. If the Franchisee fails to remove its facilities upon request, the Town may perform the work at the Franchisee's expense. 24. TRANSFER OF OWNERSHIP OR CONTROL a. A franchise issued pursuant to this Chapter shall not be sold, assigned, transferred, leased, or disposed of, either in whole or in part, either by involuntary sale or by voluntary sale, merger, consolidation, or hypothecated in any manner, nor shall title thereto, either legal or equitable, or any right, interest or property therein pass to or vest in any person or entity, or the controlling interest in any corporation holding a franchise hereunder be changed without the prior consent of the Town, and then only under such conditions as may be required by the Town. The Franchisee shall notify promptly the Town of any proposed change in, or transfer of, or acquisition by any other party of control of the Franchisee. The word "control" as used herein is not limited to major stockholders, but includes actual working control in whatever manner exercised. A rebuttable presumption that a transfer of control has occurred shall arise upon the acquisition or accumulation by any person or group or persons of ten (10) percent of the voting shares of the Franchisee. Every change, transfer, or acquisition of control of the Franchisee shall make the franchise subject to cancellation unless and until the Town shall -17- have consented thereto. For the purpose of determining whether it shall consent to such change, transfer, or acquisition of control, the Town may inquire into the qualifications of the prospective controlling party, and the Grantee shall assist the Town in any such inquiry. The consent of the To~~~n shall not be unreasonably -~iithheld. b. The consent of approval of the Town Council to any transfer of the grant shall not constitute waiver or release of the rights of the Town in and to the public ways, and any tr^ansfe-^ shall, by its terms, be expressly subordinate to the terms and conditions of the ordinance and franchise agreement. 25. SUBSCRIBER FEES AND RATES a. The initial fees to be charged to subscribers for^ all services including installation fee and other one time charges shall be specified in any franchise agreement issued pur^suant hereto. b. Those fees and charges which are subject to regulation by the Town in accordance with Federal law shall not be increased without prior approval of the Town. c. In order to obtain Town approval for rate increases, the Franchisee shall file a revised schedule of rates with the Town at least ninety (90) days in advance of a proposed rate increase. Subscribers shall be notified of the proposed increases within ten (10) days of notice to the Town. This filing shall specify the rates or fees to be increased and associated regulations which may affect charges to the subscribers and the justifications for said increases and charges. The Franchisee shall promptly submit any additional supporting infor^mation requested by the Town. d. ulithin thirty (30) days of the rate increase filing, the Town shall schedule a public meeting before the Council to hear subscriber^ and Franchisee comment on the proposed increase. Following the public meeting, the Council shall determine whether or not to grant the proposed increase or a portion thereof prior to the expiration of said ninety (90) day period. e. Rates shall be just and reasonable, considering the Franchisee's costs, including a reasonble rate on investment over the remaining term of the franchise, and shall not give any undue or unreasonable preference or advantage to any subscriber or class of subscribers. f. Rates and charges may be reduced at any time without prior Town approval, provided that the reductions do not result in rates which are unreasonably discriminatory to any subscriber or class of subscribers. Where temporary -18- ._ reductions are put into effect for promotional purposes for a specified time period, a return to the permanent rate shall not be considered a rate increase for the purpose of this Chapter. The Town shall be notified of all reductions in rates whether permanent or temporary. g. Rates and charges not subject to regulation by the Town under Federal law or regulation may be changed by the Franchisee following a minimum of thirty (30) days prior notice to the Town and a minimum of thirty (30) days prior notice to all subscribers of basic service. 26. REPORTS a. Annual Report No later than one hundred twenty (120) days after the end of the each Franchisee's fiscal years, the Franchisee shall file a written report with the Town which shall include: 1) A summary of the previous calendar year's activities and development of the system, including but not limited to, services begun or dropped, number of subscribers, including gains and losses, homes past, and miles of cable distribution plants and service. 2) A financial statement certified by an officer of Heritage including a statement of income, a balance sheet, a-~d a statement of sources and applications of funds. The staterent shall include notes that specify all significant accounting policies and practices upon which it is based, including, but not limited to, depreciation rates and methodology, overhead and interest system cost allocation methods, and basis for interest expense. A summary shall be provided comparing the current year with the three previous years. The statement shall contain a summary of the payments. 3) An annual summary of complaints received. 4) An annual projection of plans for the future. 5) An annual report of the company. 6) A current annual statement of cost of construction by component category. 7) An ownership report, indicating all persons, who at any time during the preceding year directly controlled or benefited from an interest in the franchise of five (5) percent or more of the Grantee. 8) A copy of all the Franchisee's rules and regulations applicable to subscribers and users of the cable communications system. -19- a_ b. Additional Reports The Franchisee shall prepare and furnish to the Town at the times and in the form prescribed, such additional reports with respect to its operation, as may be reasonably necessary and appropriate to the performance of any of the rights, functions or duties of the Town in connection with this ordinance or° the franchise agreement. 27. RECORDS REQUIRED a. f~laridatory Records The Franchisee shall at all times maintain: 1) A record of all complaints received during the term of the franchise. 2) A full and complete set of plans, records and "as built" maps showing the exact location of all cable television system equipment installed or in use in the Town, exclusive of subscriber service drops. b. Inspection by Town Upon reasonable notice to the Franchisee, the Town shall Piave the right to inspect all records relating to the cable operations at any time during normal business hours. All records required by the Town for such inspection shall be made available within the Town of Vail, Colorado, within a reasonable time after the request. 28. FILINGS The Franchisee shall mail or deliver a copy of all filings it makes with State and Federal agencies to the Town Clerk. Said copy shall be mailed or delivered on the filing date. 29. SERVICE CALLS AND COf~1PLAINT PROCEDURES a. During the term of the cable franchise, the Franchisee shall maintain an office in the Town or in the vicinity thereof which subscribers ~~aithin the franchise area may telephone without incurring toll charges. Except in the event of catastrophic failure, no subscriber's complaint shall remain without investigation by the Franchisee for more than a twenty-four (24) hour period. The Franchisee will provide the Town with a name, address and telephone number of the person who will act as the Franchisee's agent to receive complaints regarding quality of service, equipment malfunctions and similar matters. The local office shall be open to receive inquiries or complaints from subscribers during normal business hours, and in no event less than 9:00 a.m. to 5:00 p.m. Monday through Friday excluding legal holidays. The Franchisee shall provide the means to accept complaint calls twenty -20- ._ four (24) hours a day, seven (7) days a week. Accurate records shall he kept by the Franchisee summarizing the nature, extent, time and date by which the complaint was resolved or sought to be resolved. The Franchisee shall promptly furnish each present or future subscriber with a letter of instruction explaining the importance and the manner of reporting complaints and rules and regulations governing the obligations of the Franchisee to respond to subscriber complaints. Calls or letters involving complaints about billing and programming will be handled immediately whenever possible. H written complaint will be retained for t~~~o (2) years, including a summary reply. The complaint filed shall be available for periodic inspection by the Town. b. Should a subscriber have an unresolved complaint regarding the quality of the cable television service, equipment malfunctions, or other pertinent matters, the subscriber shall be entitled to meet jointly with the Town Manager or his authorized representative and the Franchisee System f~lanager to fully discuss in an attempt to resolve such matters, provided, that prior to such meeting, the subscriber shall clearly state in writing the specific nature, frequency and extent of the alleged problem and the dates on which the problem has occurred. This written complaint shall be filed with the Town Manager, who shall forward a copy of such complaint to the Franchisee System Manager. Franchisee shall then have five (5) days after receiving the complaint within which to assess the problem anal file a written response with the Town Manager stating specifically what has been done to correct the problem. If the subscriber remains unsatisfied after following this procedure he may then request that such a meeting with the Town Manager or his authorized representative and Franchisee System Manager be held. When there have been similar complaints made or whiere there exists other evidence which in the judgment of the Town cast doubt on the reliability or quality of cable service, the Town shall have the right and authority to require the Franchisee to test, analyze and report on the performance of the system. The Franchisee shall fully cooperate with the Town in performing such testing and shall prepare results in a report, if requested, 4vithin thirty (30) days after notice. Such report shall include the following information: 1) The nature of the complaint or problem which precipitated the tests. 2} !~1hat system component a~as tested. 3) The equipment used and procedures employed in testing. -21- a_ 4) ~ The method, if any, in which the complaint or problem was resolved. 5) Any other information pertinent to said tests and analysis which may be required. rr!here there are recurring service problems, the Town may require that tests be supervised by a qualified independent professional engineer not on the permanent staff of the Franchisee. The engineer shall sign all records of special tests and forward to the Town such records avith a report interpreting the results of the tests and recommending actions to be taken. The costs of said engineer's services shall be the sole obligation of the Franchisee. 30. SERVICE TO SUBSCRIBERS A Franchisee shall provide all the following services to subscribers: a. A basic subscriber television service tier ~vhich consists, at minimum, of any legally required must carry signals an information and weather channel and at least one (1) public educational and governmental access channel. b. The Franchisee shall provide leased access channels to the extent required by Federal law. c. A Franchisee shall provide equipment directly or thror.rgh grants for local program production by all cable users for live and video tape presentation over the cable television system. The Franchisee shall have no control over the content of access programs. Any public access channel shall be made available to any member of the public on a first come, first served, nondiscriminatory basis. 31. LEASED ACCESS The Franchisee shall make channels available for leased or commercial use as specified in the franchise agreement consistent with Federal law. 32. PUBLIC DROPS The Franchisee shall provide without charge within the franchise area one drop activated for basic subscriber cable television service to each fire station, public school, police station, public library, municipal building and other such buildings used for public purposes. 33. LOCK OUT DEVICE The Franchisee shall provide, for sale or lease, upon request, a lockout device for use by a subscriber. Such device shall be capable of restricting the reception of any channel. The lockout device should be made available to all subscribers requesting it and the charge and availability of this device shall be made a part of the rate schedule. -22- ._ 34. PROTECTION OF SUBSCRIBER PRIVACY Franchisee shall protect the Town's privacy consistent with the provision of 47 U.S.C. 631, as amended. 35. CONSTRUCTION AfJD INSTALLATIOPJ t,IORK a. The Tor~rn shall have the right to inspect all construction and installation work performed by the Franchisee subject to this Chapter as it shall find necessary to ins~.rre compliance with the governing ordinances and the franchise. b. All construction, installation; and maintenance must comply with all Town ordinances including all uniform codes adopted by the Town and all state and local regulations and good and accepted industry practices. 36. LOCATION OF STRUCTURES, LINES AND EQUIPh1ENT a. The Franchisee shall utilize existing poles, conduits and other facilities whenever possible, and shall not construct or install any new, different or additional poles, conduits or other facilities whether on public property or on privately owned property until approval of the property owner or appropriate governmental authority is obtained. However, the location and installation of any pole, conduit, or other facility by a Franchisee shall not create a vested interest, and such poles, structures, or facilities shall be removed, replaced, or modified by a Franchisee at its ot,~m expense ~rrhenever the Council or other governmental authority determines that the public interest so necessitates. b. All transmission and distribution structures, lines and equipment installed by the Franchisee within the Town shall be located so as to cause minimum interference with the proper use of streets, alleys and other public 4vays and places and to cause minimum interference trrith the rights or reasonable convenience of property owners who adjoin any of the streets, alleys or other public ways or places and where they will not interfere with any gas, electric, telephone, a~rater or other preexisting utility facility. c. All such poles and other fixtures in any street or public tvay shall be placed in full accordance with the standards set forth in the Municipal Code of the Town of Vail. d. Cable shall be installed underground at Franchisee's expense where both the existing telephone and electrical utilities are already underground. Previously installed aerial cable shall be placed underground in concert with other utilities when both the telephone and electrical utilities convert from aerial to underground construction. Franchisee shall place cable underground in newly platted areas in concert with both the telephone and electric utilities unless this -23- a_ requirement is wai-ved by the Town. Equipment shall not be stored on Town right-of- way. 37. REPLACEh1EPJT OF PAVING The Franchisee at its own cost and expense and in a manner approved by the Town shall replace and restore all paving, side~valks, driveways or surface of any street or alley or public way disturbed, in as good a condition as before the work was commenced and shall maintain the restoration in an improved condition for a period of one (1) year. Failure of the Franchisee to replace or restore such paving, sidewalk, driveway, or street surface within forty eight (48) hours after completion of work shall authorize the Town to cause the proper restoration to be made at the Franchisee's expense. 38. ALTERATION OF STREETS BY TOl4N If the Town shall lawfully decide to alter or change the grade of any street, alley, or other public way, the Franchisee, upon reasonable notice by the Town, shall, in a timely manner as requested by the Town, remove and relocate its poles, wires, cables, underground conduits, and other facilities at its oti~~n expense. If other utilities are compensated, Franchisee shall be entitled to the same compensation. 39. TRIMMING TREES A Franchisee shall have the authority to trim trees upon a~i overhanging of streets, alleys, sidewalks, and public places of the Town so as to prevent the branches of such trees from coming into contact with wires and cables and other television conductors and fixtures of the Franchisee. The Town may require all trimming to be done under its supervision and direction and at the expense of the Franchisee. 40. TEMPORARY f~10VE OF CABLES A Franchisee shall on the request of any person holding a valid house moving permit, temporarily raise or lower its wires or cables to permit the moving of buildings or other large projects. The expense of such temporary raising or lowering of wires shall be paid by the person making the request, and the Franchisee shall have the authority to require such payment in advance. The Franchisee shall be given not less than forty eight (48) hours advance notice to arrange for such temporary wire changes. 41. REFUNDS AND SERVICE TERMINATIONS a. A Franchisee shall establish and conform to the following policy regarding refunds to subscribers and users: -24- .- "If the Franchisee collects a deposit or advance charge on any service or equipment requested by a subscriber or user, the Franchisee shall provide such service or equipment within thirty (30) days of the collection of the deposit or charge or the Franchisee shall refund such deposit or charge within five {5) business days thereafter. Nothing in this Section shall be construed: 1) To relieve a Franchisee of any responsibility it may have under separately executed contracts or agreements with its subscribers or users; 2) As limiting a 1=ranchisee's liability for damages, if any, which may be imposed under the franchise for the violation or breach of any provisions thereof; or 3) To limit the Franchisee's liability for damages, if any, because of its failure to provide the service for which deposit or charge was made. b. The following requirements shall apply to subscriber disconnection: 1) There shall be no charge for disconnection of any installation, service or outlet. All cable communications equipment shall be removed within a reasonable time from a subscriber's property upon the subscriber's request, such time not to exceed thirty (30) days from the date of request. Franchisee may charge for adding or deleting channels at the subscriber's request. 2) If any subscriber fails to pay a properly due monthly subscriber's fee, or any other properly due fee or• charge, the Franchisee may disconnect the subscriber's service; provided, however, that such disconnection shall not be effected until thirty (30) days after the due date of the monthly subscriber fee or charges and shall include a minimum five (5) days written notice to the subscriber of the intent to disconnect. After disconnection, upon payment in full of all proper fees or charges, including the payment of any reconnection charge, the Franchisee shall promptly reinstate the service. 42. SERVICE AREA The Franchisee shall offer full cable television service to all areas of the Town unless specifically authorized to ser°ve a lesser area. A franchise issued in accordance ~r~ith this Ordinance shall require that all dwelling units within the franchise territory be offered service on the same terms and conditions; provided, however, multiple family dwelling complexes, apartments, or condominiums may be served on a master-bill basis; and further, service to motels, hotels, hospitals, and similar businesses or institutions may be offered on terms and conditions different from single residence subscribers. In the event that subsequent to the issuance of a franchise the Town annexes additional territory, a Franchisee shall -25- a_ extend its cable television services into the annexed area within a reasonable tune of a request by the Town to do so. Such reasonable time shall not be less than nine (9) months. 43. COPJTIiVUITY OF SERVICE a. bJhere a Franchisee rebuilds, modifies, or sells its system, it shall ensure that all subscribers receive continuous, uninterrupted service regardless of the circumstances. b. As long as it is entitled to revenues from the operation of the cable system, a Franchisee shall maintain continuity of service during any temporary transition in irhe franchise, including but not limited to, the following circumstances: 1) Revocation of the franchise. 2) Nonrenewal of the franchise. 3) Transfer of the cable system to the Town or another entity. 44. TRANSITIONAL OPERATION In the event a Franchisee continues to operate the system in a transitional period, with Town acquiescence, following the expansion, revocation, or other termination of the franchise, it shall be bound by all the terms, conditions, and obligations of the franchise as if it were in full force and effect. The terminating Franchisee shall cooperate with the Town and any subsequent Franchisee in maintaining and transferring service responsibility. 45. PERIODIC REEVALUATION AND RENEGOTIATIONS a. Since the field of cable communications is rapidly evolving and many technological, regulatory, financial, marketing, legal, competitive, and other changes are likely to occur during a franchise term, a degree of flexibility is needed in order to achieve and maintain a modern and efficient cable communications system that adequately serves the public. To this end, the Town with cooperative assistance from a Franchisee, shall periodically reevaluate the system operation and negotiate appropriate franchise changes. b. The Town shall reevaluate the Franchisee's cable operations and service three (3) years following the award date of the franchise and every three (3) years thereafter for the life of the franchise. The Franchisee shall cooperate with the Town in such evaluation and provide information as may be necessary for the evaluation. c. Following the public release of a reevaluation report, the Town and the Franchisee shall meet to discuss the reevaluation and possible means of -26- ._ improving service_to the public. At that time, the parties shall negotiate any changes in the franchise that may be necessary or° desirable. Upon r°equest of the Town, Franchisee shall, no earlier than ninety (90) days and no later than thirty (30) days prior to a review and evaluation session, conduct a written survey of subscribers. Each questionnaire shall be prepared and constructed in good faith so as to provide measurements of subscribers preferences and satisfaction for: (1) Programming offered by Franchisee at the time the survey is conducted. (2) Programming generally available to cable subscribers nationally but not offered by Franchisee at the time the service is conducted. (3) Maintenance and subscriber complaint practices. As a. part of the revie~~~ and evaluation session, Franchisee shall report in writing what steps it may be taking to implement the findings of the survey. d. The Town and the Franchisee may meet at other times to discuss and negotiate possible changes to the franchise pursuant to an agenda agreed to in advance by both parties. Such special sessions are intended to provide a mechanism for effecting franchise changes necessitated by major events affecting cable communications, such as state or federal legislation, new or revised state or federal regulations, or an extraor°dinary change in circumstances. 46. THEFT OF SERVICES AND TAMPERING a. No person, whether or not a subscriber of the cable television system may intentionally or knowingly damage or cause to be damaged any wire, cable, conduit, equipment or apparatus of the Franchisee or commit any act within intent to cause such damage, or to tap, remove, or tamper ~~~ith or otherwise connect or maintain any wire or device to a wire, cable, conduit, equipment and apparatus or appurtenances of the Franchisee with the intent to obtain and maintain a signal or impulse from the cable system without authorization from or compensation to the Franchisee, or to obtain and maintain cable television or other communications service with the intent to cheat or• defraud Franchisee of~any lawful charge to which it is entitled. b. Any person convicted of violating any provision of this Section is subject to a fine of not more thar~ five hundred dollars (500) for each offense. 47. RENEGOTIATION If any court of competent jurisdiction, the FCC or any state regulatory body rules, decisions or other action determines prior to the commencement of system construction, that any material provision of this Ordinance or• any franchise granted -27- pursuant thereto, is invalid or unenforceable, then in such event, the Town shall retain the right to renegotiate any franchise entered into prior to any such rule, decision or other action. For the purpose of this section, "Commencement of System Construction" shall mean the first day that physical construction, including but not limited to, the placing of cable on poles or underground, actually begins. 48. SEVERABILITY If any provision, section, subsection, sentence, clause or phrase of this Ordinance is for a~iy reason held to be unconstitutional, void or invalid or for any reason unenforceable, the validity of the remaining portions of this Ordinance shall not be affected thereby, it being the intent of the Town Council in adopting and approving this Ordinance then no portion hereof or provision or regulation contained herein shall become inoperative or fail by reason of any unconstitutionality or invalidity of any other portion, provision or regulation and all provisions of this Ordinance are declared to be severable. INTRODUCED, READ AND APPROVED ON FIRST READING THIS day of the day of 1989 at 7:30 p.m. in the Council Chambers of the Vail Municipal Building, Vail, Colorado. Ordered published in full this day of . 1989. Kent R. Rose, Mayor ATTEST: Pamela A. Brandmeyer, Town Clerk INTRODUCED, READ AND APPROVED ON SECOND READING AND ORDERED PUBLISHED this day of 1989. Kent R. Rose, Mayor ATTEST: Pamela A. Brandmeyer, Town Clerk 1989, and a public hearing shall be held on this Ordinance on -28-